AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 6, 2002



                                                      REGISTRATION NO. 333-87300

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

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                             ---------------------

                                AMENDMENT NO. 1


                                       TO


                                    FORM S-3
                             REGISTRATION STATEMENT
                                     UNDER
                           THE SECURITIES ACT OF 1933
                             ---------------------

                               CONMED CORPORATION
             (Exact name of registrant as specified in its charter)



                        NEW YORK                                                 16-0977505
                                                       
             (State or other jurisdiction of                                  (I.R.S. employer
             incorporation or organization)                                identification number)


                                525 FRENCH ROAD
                           UTICA, NEW YORK 13502-5994
                                 (315) 797-8375
              (Address, including zip code, and telephone number,
       including area code, of registrant's principal executive offices)

                                DANIEL S. JONAS
                        VICE PRESIDENT -- LEGAL AFFAIRS
                              AND GENERAL COUNSEL
                                525 FRENCH ROAD
                           UTICA, NEW YORK 13502-5994
                                 (315) 797-8375
               (Name, address, including zip code, and telephone
               number, including area code, of agent for service)
                             ---------------------
                                   COPIES TO:


                                                
               ROBERT W. DOWNES                                   ALLAN G. SPERLING
              SULLIVAN & CROMWELL                        CLEARY, GOTTLIEB, STEEN & HAMILTON
               125 BROAD STREET                                   ONE LIBERTY PLAZA
              NEW YORK, NY 10004                                 NEW YORK, NY 10006
                (212) 558-4000                                     (212) 225-2000


    APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:  As soon as
practicable after the effective date of this Registration Statement.

    If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]

    If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [ ]

    If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]

    If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]

    If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
                             ---------------------


    THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SAID SECTION 8(a), MAY DETERMINE.

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


THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.


                    SUBJECT TO COMPLETION, DATED MAY 6, 2002


PROSPECTUS


                                3,000,000 SHARES


                           [CONMED CORPORATION LOGO]

                               CONMED CORPORATION

                                  COMMON STOCK
                              $         PER SHARE
                               ------------------
     We are selling 3,000,000 shares of our common stock in this offering. We
have granted the underwriters an option to purchase up to 450,000 additional
shares of our common stock to cover any over-allotments.


     Our common stock is quoted on the Nasdaq National Market under the symbol
"CNMD." The last reported sale price of our common stock on the Nasdaq National
Market on May 2, 2002, was $25.60 per share.

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

     INVESTING IN OUR COMMON STOCK INVOLVES RISKS. SEE "RISK FACTORS" BEGINNING
ON PAGE 7.


     Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
                               ------------------




                                                               PER SHARE        TOTAL
                                                              ------------   ------------
                                                                       
Public Offering Price                                         $              $
Underwriting Discount                                         $              $
Proceeds to CONMED (before expenses)                          $              $




     The underwriters expect to deliver the shares to purchasers on or about May
  , 2002.


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

SALOMON SMITH BARNEY
                UBS WARBURG
                                 NEEDHAM & COMPANY, INC.
                                              FIRST ALBANY CORPORATION
            , 2002



                        [PICTURES OF CERTAIN PRODUCTS OF


               CONMED CORPORATION'S ARTHROSCOPY, POWERED SURGICAL


                     INSTRUMENTS AND ELECTROSURGERY UNITS]




     YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN OR INCORPORATED BY
REFERENCE IN THIS PROSPECTUS. WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH
DIFFERENT INFORMATION. WE ARE NOT MAKING AN OFFER OF THESE SECURITIES IN ANY
STATE OR OTHER JURISDICTION WHERE THE OFFER IS NOT PERMITTED. YOU SHOULD NOT
ASSUME THAT THE INFORMATION CONTAINED IN THIS PROSPECTUS IS ACCURATE AS OF ANY
DATE OTHER THAN THE DATE ON THE FRONT OF THIS PROSPECTUS.

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

                               TABLE OF CONTENTS




                                                              PAGE
                                                              ----
                                                           
Summary.....................................................    1
Risk Factors................................................    7
Cautionary Statement Concerning Forward-Looking
  Statements................................................   13
Price Range of Our Common Stock.............................   14
Dividend Policy.............................................   14
Use of Proceeds.............................................   14
Capitalization..............................................   15
Selected Financial Data.....................................   16
Management's Discussion and Analysis of Financial Condition
  and Results of Operations.................................   18
Business....................................................   28
Management..................................................   40
Description of Capital Stock................................   43
Shares Eligible for Future Sale.............................   44
Underwriting................................................   45
Validity of Common Stock....................................   47
Experts.....................................................   47
Where You Can Find More Information.........................   47
Index to Financial Statements...............................  F-1




                                    SUMMARY


     The following summary is qualified in its entirety by the more detailed
information and financial statements appearing elsewhere in this prospectus or
incorporated by reference herein. An investment in the common stock involves
significant risks. See "Risk Factors."


                               CONMED CORPORATION


     CONMED Corporation is a medical technology company specializing in
instruments, implants and video equipment for arthroscopic sports medicine, and
powered surgical instruments, such as drills and saws, for orthopedic, ENT,
neuro-surgery and other surgical specialties. We are also a leading developer,
manufacturer and supplier of advanced surgical devices, including radio
frequency, or RF, electrosurgery systems used routinely to cut and cauterize
tissue in nearly all types of surgical procedures worldwide, and endoscopy
products, such as trocars, clip appliers, scissors and surgical staplers. We
also manufacture and sell a full line of ECG electrodes for heart monitoring and
other patient care products.


     The following table sets forth the percentage of net sales for each
category of our products for 1999, 2000 and 2001:



                                                         YEAR ENDED DECEMBER 31,
                                                     --------------------------------
                                                       1999        2000        2001
                                                     --------    --------    --------
                                                                    
Arthroscopy........................................        38%         36%         36%
Powered surgical instruments.......................        23          29          27
Electrosurgery.....................................        17          16          16
Patient Care.......................................        21          17          16
Endoscopy..........................................         1           2           5
                                                     --------    --------    --------
  Total............................................       100%        100%        100%
                                                     ========    ========    ========
Net sales (in thousands)...........................  $376,226    $395,873    $428,722
                                                     ========    ========    ========


     Our products are used in a variety of clinical settings such as operating
rooms, surgery centers, physicians' offices and critical care areas of
hospitals. We employ a razor/razor blade business model whereby we sell capital
equipment and the associated single-use disposable products. During 2001, we
derived approximately 75% of our revenues from single-use disposable products
and the remainder from capital equipment. We believe the sale of disposable
products provides a recurring revenue stream that helps insulate us from
temporary market downturns.

     We have used strategic business acquisitions to broaden our product
offerings, to increase our market share in certain product lines and to realize
economies of scale. Since 1997, we have completed six significant business
acquisitions. The completed acquisitions, together with internal growth, have
resulted in a compound annual growth rate in net sales of 32% between 1997 and
2001.

                                        1


INDUSTRY

     The growth in the markets for our products is primarily driven by:


     - Favorable Demographics.  The number of surgical procedures performed is
       increasing. This growth in surgical procedures reflects demographic
       trends, such as the aging of the population, and technological
       advancements, such as safer and less invasive surgical procedures. Sales
       of our surgical products represented over 85% of our total 2001 sales.



     - Continued Pressure to Reduce Health Care Costs.  In response to rising
       health care costs, managed care companies and other third-party payers
       have placed pressure on health care providers to reduce costs. In turn,
       health care providers are increasingly purchasing single-use disposable
       products, which reduce the costs associated with sterilizing surgical
       instruments and products following surgery.



     - Increased Global Medical Spending.  We believe that foreign markets offer
       growth opportunities for our products. We currently distribute our
       products through our own sales subsidiaries or through local dealers in
       over 100 foreign countries. International sales represented approximately
       29% of total sales in 2001.


COMPETITIVE STRENGTHS

     We believe that we have a top two or three market share position in each of
our five key product areas and have established our position as a market leader
by capitalizing on the following competitive strengths:


     - Strong Brand Recognition.  Our products are sold under leading brand
       names, including CONMED(R), Linvatec(R) and Hall Surgical(R). These brand
       names are well recognized by physicians for quality and service, and we
       believe that brand recognition helps drive demand for our products.


     - Breadth of Product Offering.  The breadth of our product lines in our key
       product areas enables us to meet a wide range of customer requirements
       and preferences. In three of our five key product areas, we are only one
       of two providers that offers a full line of products.


     - Successful Integration of Acquisitions.  Since 1997, we have completed
       six acquisitions, including the 1997 acquisition of Linvatec Corporation,
       which more than doubled our size. Our management team, which averages
       more than 15 years of experience in the health care industry, has
       demonstrated the ability to identify complementary acquisitions and to
       integrate acquired companies into our operations.


     - Extensive Marketing and Distribution Infrastructure.  We market our
       products domestically through our sales force consisting of approximately
       210 employee sales representatives and an additional 90 sales
       professionals employed by eight non-stocking sales agent groups, seven of
       which are exclusive. Additionally, we have an international presence
       through sales subsidiaries and branches located in key international
       markets. The size and coverage of our distribution infrastructure assists
       in driving our sales.

     - Vertically Integrated Manufacturing.  We manufacture most of our products
       and components. Our vertically integrated manufacturing process has
       allowed us to provide quality products, to react quickly to changes in
       demand and to generate manufacturing efficiencies.

     - Research and Development Expertise.  Our research and development effort
       is focused on introducing new products, enhancing existing products and
       developing new technologies. During the last two years, we have
       introduced more than 24 products and product enhancements, many of which
       were "first-to-market" products.

                                        2


BUSINESS STRATEGY

     Our business strategy is to continue to strengthen our position as a market
leader in our key product areas. The elements of our strategy include:

     - Introduce New Products and Product Enhancements.  We will continue to
       pursue organic growth by developing new products and enhancing existing
       products to respond to customer needs and preferences.

     - Pursue Strategic Acquisitions.  We believe that strategic acquisitions
       represent a cost-effective means of broadening our product line. We have
       historically targeted companies with proven technologies and established
       brand names that provide potential sales, marketing and manufacturing
       synergies.

     - Realize Manufacturing and Operating Efficiencies.  We will continue to
       review opportunities for consolidating product lines and streamlining
       production. We believe our vertically integrated manufacturing processes
       can produce further opportunities to reduce overhead and to increase
       operating efficiencies and capacity utilization.

     - Maintain Strong International Sales Growth.  We intend to maintain our
       international sales growth and increase our penetration into
       international markets by utilizing our relationships with foreign
       surgeons, hospitals and third-party payers, as well as foreign
       distributors.

                               RECENT DEVELOPMENT


PURCHASE AND CANCELLATION OF WARRANT ISSUED TO BRISTOL-MYERS SQUIBB



     In 1997, in connection with the acquisition of Linvatec, we issued to
Bristol-Myers Squibb Company a warrant that is exercisable in whole or in part
for up to 1,500,000 shares of our common stock at a price of $22.82 per share.
On April 30, 2002, we agreed to purchase the warrant for $2 million in cash and
upon its purchase, we intend to cancel it.


                                        3


                                  THE OFFERING

Common stock offered by us....   3,000,000 shares

Common stock outstanding after
this offering.................   28,549,358 shares


Use of proceeds...............   We will use the estimated net proceeds of
                                 approximately $72.2 million that we will
                                 receive from this offering to repay outstanding
                                 debt under our credit agreement. See "Use of
                                 Proceeds."


Nasdaq National Market
symbol........................   CNMD

     The number of shares of common stock to be outstanding after this offering
is based upon 25,549,358 shares of common stock that were outstanding on March
29, 2002 and does not include the following:

     - 3,440,829 shares of common stock issuable based upon the exercise of
       outstanding stock options as of March 29, 2002 under our stock option
       plans, of which 1,719,932 shares were exercisable.

     - 450,000 shares of common stock issuable in this offering to the
       underwriters pursuant to an over-allotment option.

     Our executive offices are located at 525 French Road, Utica, New York
13502-5994. Our telephone number is (315) 797-8375 and our internet address is
www.conmed.com. The information contained on our website is not part of this
prospectus.

                                        4


                             SUMMARY FINANCIAL DATA


     The information below sets forth summary financial data as of and for each
of the three years in the period ended December 31, 2001 and the three months
ended March 31, 2001 and 2002. The data for the three years in the period ended
December 31, 2001 and as of December 31, 2000 and 2001 has been derived from and
should be read in conjunction with our consolidated financial statements,
including the notes thereto, included in this prospectus beginning on page F-1,
and "Management's Discussion and Analysis of Financial Condition and Results of
Operations" beginning on page 18. The information as of December 31, 1999 has
been derived from our audited financial statements not incorporated by reference
or included herein. The summary financial data for the three months ended March
31, 2001 and 2002 are unaudited but, in the opinion of management, reflect all
adjustments (comprising only normal recurring accruals) necessary for a fair
presentation of our consolidated operating results and financial position for
such interim periods. Results for interim periods are not necessarily indicative
of results for the full year or for any other period. We have never paid any
cash dividends.





                                                                               THREE MONTHS
                                            YEAR ENDED DECEMBER 31,          ENDED MARCH 31,
                                         ------------------------------   ----------------------
                                           1999       2000       2001       2001        2002
                                         --------   --------   --------   --------   -----------
                                             (IN THOUSANDS, EXCEPT PER SHARE AND SHARE DATA)
                                                                               (UNAUDITED)
                                                                      
STATEMENT OF INCOME DATA(1):
Net sales..............................  $376,226   $395,873   $428,722   $105,909    $113,205
Cost of sales(2).......................   178,480    188,223    204,374     49,674      54,104
Selling and administrative
  expense(3)(4)........................   110,842    128,316    140,560     34,829      34,468
Research and development expense.......    12,108     14,870     14,830      3,696       3,824
                                         --------   --------   --------   --------    --------
  Income from operations...............    74,796     64,464     68,958     17,710      20,809
Interest expense, net..................    32,360     34,286     30,824      8,331       6,628
                                         --------   --------   --------   --------    --------
  Income before income taxes and
     extraordinary item................    42,436     30,178     38,134      9,379      14,181
Provision for income taxes.............    15,277     10,864     13,728      3,376       5,105
                                         --------   --------   --------   --------    --------
  Net income...........................  $ 27,159   $ 19,314   $ 24,406   $  6,003    $  9,076
                                         ========   ========   ========   ========    ========
EARNINGS PER SHARE:
Basic..................................  $   1.19   $   0.84   $   1.02   $   0.26    $   0.36
Diluted................................  $   1.17   $   0.83   $   1.00   $   0.26    $   0.35

WEIGHTED AVERAGE NUMBER
  OF COMMON SHARES
  USED IN CALCULATING:
Basic earnings per share...............    22,862     22,967     24,045     23,057      25,397
Diluted earnings per share.............    23,145     23,271     24,401     23,307      25,969

OTHER FINANCIAL DATA:
Depreciation and amortization..........  $ 26,291   $ 29,487   $ 30,148   $  7,566    $  5,403
Capital expenditures...................     9,352     14,050     14,443      3,867       3,208






                                                                                         AS OF
                                                           AS OF DECEMBER 31,          MARCH 31,
                                                     ------------------------------   -----------
                                                       1999       2000       2001        2002
                                                     --------   --------   --------   -----------
                                                                    (IN THOUSANDS)
                                                                                      (UNAUDITED)
                                                                          
BALANCE SHEET DATA:
Cash and cash equivalents..........................  $  3,747   $  3,470   $  1,402     $  2,634
Working capital....................................   109,526    113,755     44,712       47,434
Total assets.......................................   662,161    679,571    701,608      706,950
Long-term debt (including current portion).........   394,669    378,748    335,929      325,991
Total shareholders' equity.........................   211,261    230,603    283,634      295,211



                                                                      (footnotes
on following page)
                                        5


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

(1) Includes, based on the purchase method of accounting, the results of (i) the
    powered instrument product line acquired from 3M Company, from August 1999;
    and (ii) the minimally invasive surgical product lines acquired from Imagyn
    Medical Technologies, Inc. in November 2000 and July 2001, in each such case
    from the date of acquisition.


(2) Includes for 1999, $1,600,000 of incremental expense related to the excess
    of the fair value at the acquisition date over the cost to produce inventory
    related to the powered instrument product line acquired from 3M; and
    includes for 2001, $1,567,000 of transition expenses related to the July
    2001 acquisition from Imagyn.

(3) Included in selling and administrative expense for 1999 is a $1,256,000
    benefit related to a previously recorded litigation accrual which was
    settled on favorable terms. Included in selling and administrative expense
    for 2000 is a severance charge of $1,509,000 related to the restructuring of
    our arthroscopy sales force.


(4) Effective January 1, 2002, the provisions of SFAS 142 were adopted relative
    to the cessation of amortization for goodwill and certain intangibles. Had
    we accounted for goodwill and certain intangibles in accordance with SFAS
    142 for all periods presented, net income would have been $32,227,000 in
    1999, $24,969,000 in 2000, $30,061,000 in 2001 and $7,416,000 in the three
    months ended March 31, 2001.


                                        6


                                  RISK FACTORS

     An investment in our common stock involves a high degree of risk. You
should carefully consider the following factors, in addition to the other
information contained in this prospectus, in deciding whether to invest in our
common stock. This prospectus and documents incorporated by reference herein
contain forward-looking statements that involve risks and uncertainties. Our
actual results may differ significantly from the results discussed in the
forward-looking statements. See "Cautionary Statement Concerning Forward-Looking
Statements" below. Factors that might cause such differences include those
discussed below.


OUR FINANCIAL PERFORMANCE IS SUBJECT TO THE RISK OF BUSINESS ACQUISITIONS,
INCLUDING THE EFFECTS OF INCREASED BORROWING AND THE INTEGRATION OF BUSINESSES


     A key element of our business strategy has been to expand through
acquisitions and we may seek to pursue additional acquisitions in the future.
Our success is dependent in part upon our ability to integrate acquired
companies or product lines into our existing operations. We may not have
sufficient management and other resources to accomplish the integration of our
past and future acquisitions, and implementing our acquisition strategy may
strain our relationship with customers, suppliers, distributors, manufacturing
personnel or others. There can be no assurance that we will be able to identify
and make acquisitions on acceptable terms or that we will be able to obtain
financing for such acquisitions on acceptable terms. In addition, while we are
generally entitled to customary indemnification from sellers of businesses for
any difficulties that may have arisen prior to our acquisition of each business,
acquisitions may involve exposure to unknown liabilities and the amount and time
for claiming under these indemnification provisions is often limited. As a
result, our financial performance is now and will continue to be subject to
various risks associated with the acquisition of businesses, including the
financial effects associated with any increased borrowing required to fund such
acquisitions or with the integration of such businesses.


FAILURE TO COMPLY WITH REGULATORY REQUIREMENTS COULD RESULT IN RECALLS, FINES OR
MATERIALLY ADVERSE IMPLICATIONS FOR OUR BUSINESS


     All of our products are classified as medical devices subject to regulation
by the Food and Drug Administration. As a manufacturer of medical devices, our
manufacturing processes and facilities are subject to on-site inspection and
continuing review by the FDA for compliance with the Quality System Regulations.
Manufacturing and sales of our products outside the United States are also
subject to foreign regulatory requirements that vary from country to country.
The time required to obtain approvals from foreign countries may be longer or
shorter than that required for FDA approval, and requirements for foreign
approvals may differ from FDA requirements. Failure to comply with applicable
domestic and/or foreign requirements can result in:

     - fines or other enforcement actions;

     - recall or seizure of products;

     - total or partial suspension of production;

     - withdrawal of existing product approvals or clearances;

     - refusal to approve or clear new applications or notices;

     - increased quality control costs; or

     - criminal prosecution.

     The failure to comply with Quality System Regulations and applicable
foreign regulations could have a material adverse effect on our business,
financial condition or results of operations.

                                        7



IF WE ARE NOT ABLE TO MANUFACTURE PRODUCTS IN COMPLIANCE WITH REGULATORY
STANDARDS, WE MAY DECIDE TO CEASE MANUFACTURE OF THOSE PRODUCTS AND MAY BE
SUBJECT TO PRODUCT RECALL


     In addition to the Quality System Regulations, many of our products are
also subject to industry-set standards. We may not be able to comply with these
regulations and standards due to deficiencies in component parts or our
manufacturing processes. If we are not able to comply with the Quality System
Regulations or industry-set standards, we may not be able to fill customer
orders and we may decide to cease production of non-compliant products. Failure
to produce products could affect our profit margins and could lead to loss of
customers.

     Our products are subject to product recall and product recalls have been
made in the past. Although no recall has had a material adverse effect on our
business, financial condition or results of operations, we cannot assure you
that regulatory issues will not have a material adverse effect in the future or
that product recall will not harm our reputation and our relationships with our
customers.


THE HIGHLY COMPETITIVE MARKET FOR OUR PRODUCTS MAY CREATE ADVERSE PRICING
PRESSURES



     The market for our products is highly competitive and our customers have
numerous alternatives of supply. Many of our competitors offer a range of
products in areas other than those in which we compete, which may make such
competitors more attractive to surgeons, hospitals, group purchasing
organizations, or GPOs, and others. In addition, many of our competitors are
larger and have greater financial resources than we do and offer a range of
products broader than our products. Competitive pricing pressures or the
introduction of new products by our competitors could have an adverse effect on
our revenues. Because our customers are not bound by long-term supply
arrangements with us, we may not be able to shift our production to other
products following a loss of customers to our competitors, leading to an
accompanying adverse effect on our profitability. See "Business--Competition"
for a further discussion of these competitive forces.


     Factors that could lead our customers to choose products offered by our
competitors include:

     - changes in surgeon preferences;

     - increases or decreases in health care spending related to medical
       devices;

     - our inability to furnish products to them, such as a result of product
       recall or back-order;

     - the introduction by competitors of new products or new features to
       existing products;

     - the introduction by competitors of alternative surgical technology; and

     - advances in surgical procedures and discoveries or developments in the
       health care industry.


COST REDUCTION EFFORTS IN THE HEALTH CARE INDUSTRY COULD PUT PRESSURE ON OUR
PRICES AND MARGINS



     In recent years, the health care industry has undergone significant change
driven by various efforts to reduce costs, including efforts at national health
care reform, trends toward managed care, cuts in Medicare, consolidation of
health care distribution companies, and collective purchasing arrangements by
GPOs and integrated health networks, or IHNs. Demand and prices for our products
may be adversely affected by these trends.



WE MAY NOT BE ABLE TO KEEP PACE WITH TECHNOLOGICAL CHANGE OR TO SUCCESSFULLY
DEVELOP NEW PRODUCTS WHICH COULD CAUSE US TO LOSE BUSINESS TO COMPETITORS



     The market for our products is characterized by rapidly changing
technology. Our future financial performance will in part be dependent on our
ability to develop and manufacture new products on a cost-effective basis, to
introduce them to the market on a timely basis and to have them accepted by
surgeons.


                                        8



     We may not be able to keep pace with technological change or to develop
viable new products. Factors which could cause delay in releasing new products
or even cancellation of our plans to produce and market these new products
include:


     - research and development delays;

     - delays in securing regulatory approvals; or

     - changes in the competitive landscape, including the emergence of
       alternative products or solutions which reduce or eliminate the markets
       for pending products.


OUR NEW PRODUCTS MAY FAIL TO ACHIEVE EXPECTED LEVELS OF MARKET ACCEPTANCE


     Any new products we launch may fail to achieve market acceptance. The
degree of market acceptance of any of our products will depend on a number of
factors, including:

     - our ability to develop and introduce new products and product
       enhancements in the time frames we currently estimate;

     - our ability to successfully implement new technologies;

     - the market's readiness to accept new products, such as our PowerPro(R)
       Battery System;

     - having adequate financial and technological resources for future product
       development and promotion;

     - the efficacy of our products; and

     - the prices of our products compared to the prices of our competitors'
       products.

     If our new products do not achieve market acceptance, we may be unable to
recoup our investments and may lose business to competitors.


     In addition, some of the companies with which we now compete or may compete
in the future have or may have more extensive research, marketing and
manufacturing capabilities and significantly greater technical and personnel
resources than we do, and may be better positioned to continue to improve their
technology in order to compete in an evolving industry. See
"Business--Competition" for a further discussion of these competitive forces.



OUR CREDIT AGREEMENT CONTAINS COVENANTS THAT MAY LIMIT OUR FLEXIBILITY OR
PREVENT US FROM TAKING ACTIONS TO RESPOND TO CHANGES IN OUR BUSINESS OR THE
COMPETITIVE ENVIRONMENT


     Our credit agreement contains, and future credit facilities are expected to
contain, certain restrictive covenants which will affect, and in many respects
significantly limit or prohibit, among other things, our ability to:

     - incur indebtedness;

     - make prepayments of certain indebtedness;

     - make investments;

     - engage in transactions with affiliates;

     - pay dividends;

     - sell assets; and

     - pursue acquisitions.


     These covenants may prevent us from pursuing acquisitions, significantly
limit our operating and financial flexibility, and limit our ability to respond
to changes in our business or competitive activities. Our ability to comply with
such provisions may be affected by events beyond our control. In the event of


                                        9



any default under our credit agreement, the credit agreement lenders could elect
to declare all amounts borrowed under our credit agreement, together with
accrued interest, to be due and payable. If we were unable to repay such
borrowings, the credit agreement lenders could proceed against the collateral
securing the credit agreement, which consists of substantially all of our
property and assets, except for our accounts receivable and related rights which
are sold in connection with the accounts receivable sales agreement. See
"Management's Discussion and Analysis of Financial Condition and Results of
Operations--Liquidity and Capital Resources" for a discussion of the accounts
receivable sales agreement.



OUR SUBSTANTIAL LEVERAGE AND DEBT SERVICE REQUIREMENTS MAY FORCE US TO ADOPT
ALTERNATIVE BUSINESS STRATEGIES



     We have indebtedness that is substantial in relation to our shareholders'
equity, as well as interest and debt service requirements that are significant
compared to our cash flow from operations. On a pro forma basis, after giving
effect to the application of the net proceeds of this offering and assuming net
proceeds from this offering of $72.2 million, as of March 31, 2002, we would
have had $253.8 million of debt outstanding, representing 41% of total
capitalization. This amount includes the current portion of our long-term debt,
but does not include the $40 million of receivables sold to a conduit purchaser
under the accounts receivable sales agreement described below under
"Management's Discussion and Analysis of Financial Condition and Results of
Operations--Liquidity and Capital Resources," the proceeds of which were used to
repay indebtedness.


     The degree to which we are leveraged could have important consequences to
investors, including but not limited to the following:

     - a substantial portion of our cash flow from operations must be dedicated
       to debt service and will not be available for operations, capital
       expenditures, acquisitions, dividends and other purposes;

     - our ability to renegotiate our revolving credit facility and obtain
       additional financing in the future for working capital, capital
       expenditures, acquisitions or general corporate purposes may be limited
       or impaired, or may be at higher interest rates;

     - we may be at a competitive disadvantage when compared to competitors that
       are less leveraged;

     - we may be hindered in our ability to adjust rapidly to market conditions;

     - our degree of leverage could make us more vulnerable in the event of a
       downturn in general economic conditions or other adverse circumstances
       applicable to us; and

     - our interest expense could increase if interest rates in general increase
       because some of our borrowings, including our borrowings under our credit
       agreement, are and will continue to be at variable rates of interest.


WE MAY NOT BE ABLE TO GENERATE SUFFICIENT CASH TO SERVICE OUR INDEBTEDNESS,
WHICH COULD REQUIRE US TO REDUCE OUR EXPENDITURES, SELL ASSETS, RESTRUCTURE OUR
INDEBTEDNESS OR SEEK ADDITIONAL EQUITY CAPITAL



     Our ability to satisfy our obligations will depend upon our future
operating performance, which will be affected by prevailing economic conditions
and financial, business and other factors, many of which are beyond our control.
We may not have sufficient cash flow available to enable us to meet our
obligations. If we are unable to service our indebtedness, we will be forced to
adopt an alternative strategy that may include actions such as foregoing
acquisitions, reducing or delaying capital expenditures, selling assets,
restructuring or refinancing our indebtedness or seeking additional equity
capital. We can not assure you that any of these strategies could be implemented
on terms acceptable to us, if at all. See "Management's Discussion and Analysis
of Financial Condition and Results of Operations--Liquidity and Capital
Resources" for a discussion of our indebtedness and its implications.


                                        10



WE MAY BE UNABLE TO CONTINUE TO SELL OUR ACCOUNTS RECEIVABLE, WHICH COULD
REQUIRE US TO SEEK ALTERNATIVE SOURCES OF FINANCING



     Under our receivables agreement, there are certain statistical ratios which
must be maintained relating to the pool of receivables in order for us to
continue selling to the conduit purchaser and the conduit purchaser can cease
its purchase of our receivables. These ratios relate to sales dilution and
losses on accounts receivable. If new accounts receivable arising in the normal
course of business do not qualify for sale or the conduit purchaser otherwise
ceases its purchase of our receivables, we would need to access alternative
sources of working capital, which could be more expensive or difficult to
obtain.



WE MAY BE UNABLE TO SUCCESSFULLY RENEGOTIATE OUR CREDIT FACILITY ON TERMS WE
DEEM ACCEPTABLE



     Our $100 million revolving credit facility terminates on December 31, 2002.
We are currently negotiating with our bank group to extend the revolving credit
facility, or in the alternative, to renegotiate our entire senior credit
facility. We may be unable to obtain credit arrangements on terms we deem
acceptable. If we are unable to successfully negotiate a new senior credit
arrangement that provides sufficient capital for our business, we could be
forced to sell assets, alter our business strategy or obtain alternative sources
of financing.



THE LOSS OR INVALIDITY OF OUR PATENTS MAY REDUCE OUR COMPETITIVE ADVANTAGE


     Much of the technology used in the markets in which we compete is covered
by patents. We have numerous U.S. patents and corresponding foreign patents on
products expiring at various dates from 2002 through 2019 and have additional
patent applications pending. See "Business--Research and Development Activities"
for a further description of our patents. The loss of our patents could reduce
the value of the related products and any related competitive advantage.
Competitors may also be able to design around our patents and to compete
effectively with our products. Also, our competitors may allege that our
products infringe their patents, leading to voluntary or involuntary loss of
sales from those products. In addition, the cost to prosecute infringements of
our patents or the cost to defend our products against patent infringement
actions by others could be substantial. We cannot assure you that:


     - pending patent applications will result in issued patents;



     - patents issued to or licensed by us will not be challenged by
       competitors;



     - our patents will be found to be valid or sufficiently broad to protect
       our technology or provide us with a competitive advantage; and


     - we will be successful in defending against pending or future patent
       infringement claims asserted against our products.


ORDERING PATTERNS OF OUR CUSTOMERS MAY CHANGE RESULTING IN REDUCTIONS IN SALES


     Our hospital and surgery center customers purchase our products in
quantities sufficient to meet their anticipated demand. Likewise, our health
care distributor customers purchase our products for ultimate resale to health
care providers in quantities sufficient to meet the anticipated requirements of
the distributors' customers. Should inventories of our products owned by our
hospital, surgery center and distributor customers grow to levels higher than
their requirements, our customers may reduce the ordering of products from us.
This could cause a reduction in our sales in a financial accounting period.

                                        11



OUR SIGNIFICANT INTERNATIONAL OPERATIONS SUBJECT US TO RISKS ASSOCIATED WITH
OPERATING IN FOREIGN COUNTRIES


     A portion of our operations are conducted outside the United States. About
29% of our 2001 net sales constituted foreign sales. As a result of our
international operations, we are subject to risks associated with operating in
foreign countries, including:

     - devaluations and fluctuations in currency exchange rates;

     - imposition of limitations on conversions of foreign currencies into
       dollars or remittance of dividends and other payments by foreign
       subsidiaries;

     - imposition or increase of withholding and other taxes on remittances and
       other payments by foreign subsidiaries;

     - trade barriers;

     - political risks, including political instability;

     - reliance on third parties to distribute our products;

     - hyperinflation in certain foreign countries; and

     - imposition or increase of investment and other restrictions by foreign
       governments.

     We cannot assure you that such risks will not have a material adverse
effect on our business and results of operations.


WE CAN BE SUED FOR PRODUCING DEFECTIVE PRODUCTS AND OUR INSURANCE COVERAGE MAY
BE INSUFFICIENT TO COVER THE NATURE AND AMOUNT OF ANY PRODUCT LIABILITY CLAIMS



     The nature of our products as medical devices and today's litigious
environment should be regarded as potential risks that could significantly and
adversely affect our financial condition and results of operations. The
insurance we maintain to protect against claims associated with the use of our
products may not adequately cover the amount or nature of any claim asserted
against us, and we are exposed to the risk that our claims may be excluded and
that our insurers may become insolvent. See "Item 3: Legal Proceedings" in our
Form 10-K for a further discussion of the risk of product liability actions and
our insurance coverage.


                                        12


                        CAUTIONARY STATEMENT CONCERNING
                           FORWARD-LOOKING STATEMENTS

FORWARD-LOOKING STATEMENTS MADE IN THIS PROSPECTUS

     In this prospectus, we make forward-looking statements about our financial
condition, results of operations and business. Forward-looking statements are
statements made by us concerning events that may or may not occur in the future.
These statements may be made directly in this document or may be "incorporated
by reference" from other documents. You can find many of these statements by
looking for words like "believes," "expects," "anticipates," "estimates" or
similar expressions.

FORWARD-LOOKING STATEMENTS ARE NOT GUARANTEES OF FUTURE PERFORMANCE

     Forward-looking statements involve known and unknown risks, uncertainties
and other factors, including those that may cause our actual results,
performance or achievements, or industry results, to be materially different
from any future results, performance or achievements expressed or implied by
such forward-looking statements. Such factors include those identified under
"Risk Factors" above and those set forth elsewhere and incorporated by reference
in this prospectus, among others, including the following:

     - general economic and business conditions;

     - changes in customer preferences;

     - changes in technology;

     - the introduction of new products;

     - changes in business strategy;

     - the possibility that United States or foreign regulatory and/or
       administrative agencies might initiate enforcement actions against us or
       our distributors;

     - quality of our management and business abilities and the judgment of our
       personnel; and

     - the availability, terms and deployment of capital.

     See "Management's Discussion and Analysis of Financial Condition and
Results of Operations" and "Business" below for a further discussion of these
factors. You are cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date hereof. We do not undertake any
obligation to publicly release any revisions to these forward-looking statements
to reflect events or circumstances after the date of this prospectus or to
reflect the occurrence of unanticipated events.

                                        13


                        PRICE RANGE OF OUR COMMON STOCK


     Our common stock, par value $.01 per share, is traded on the Nasdaq
National Market under the symbol "CNMD." At March 29, 2002, there were 1,213
registered holders of our common stock and approximately 6,100 accounts held in
"street name."


     The following table shows certain high-low last sales prices for our common
stock, as reported by the Nasdaq National Market. These sales prices have been
adjusted for a three-for-two split of our common stock effected in the form of a
common stock dividend and paid on September 7, 2001 to shareholders of record on
August 21, 2001.



                                                              COMMON STOCK PRICE
                                                              ------------------
YEAR ENDED DECEMBER 31, 2000:                                  HIGH        LOW
-----------------------------                                 -------    -------
                                                                   
First Quarter...............................................  $20.50     $15.04
Second Quarter..............................................   18.37      15.75
Third Quarter...............................................   17.41       8.08
Fourth Quarter..............................................   12.04       8.62




YEAR ENDED DECEMBER 31, 2001:                                  HIGH      LOW
-----------------------------                                 ------    ------
                                                                  
First Quarter...............................................  $15.92    $10.83
Second Quarter..............................................   18.00     13.08
Third Quarter...............................................   21.21     15.73
Fourth Quarter..............................................   21.01     16.53





YEAR ENDED DECEMBER 31, 2002:                                  HIGH      LOW
-----------------------------                                 ------    ------
                                                                  
First Quarter...............................................  $25.00    $19.29
Second Quarter (through May 2, 2002)........................  $27.00    $24.11




     On May 2, 2002, the last sale price for the common stock on the Nasdaq
National Market was $25.60.


                                DIVIDEND POLICY

     We have never paid cash dividends on our common stock. Our board of
directors presently intends to retain future earnings to finance the development
of our business and does not intend to declare cash dividends. Should this
policy change, the declaration of dividends will be determined by our board in
light of conditions then existing, including our financial requirements and
condition and the limitation on the declaration and payment of cash dividends
contained in debt agreements.

                                USE OF PROCEEDS


     The net proceeds from this offering, after payment of our fees and expenses
incurred in connection with this offering, are estimated to be approximately
$72.2 million (assuming an offering price of $25.60 per share and assuming the
underwriters' over-allotment option is not exercised). We will use the net
proceeds from this offering to repay outstanding debt under our credit
agreement.


     The borrowings under our credit agreement, of which $172.8 million was
outstanding as of March 31, 2002, include a term portion that bears interest at
a weighted average of LIBOR plus 2.13% (4.20% at March 31, 2002) and a revolving
portion that bears interest at LIBOR plus 1.50% (3.70% at March 31, 2002).

                                        14


                                 CAPITALIZATION


     The following table sets forth our consolidated capitalization, which
includes the current portion of our long-term debt, as of March 31, 2002, and as
adjusted to give pro forma effect to our sale of 3,000,000 shares of our common
stock offered hereby at an assumed offering price of $25.60 per share and the
application of the net proceeds therefrom as described under "Use of Proceeds":





                                                                  MARCH 31, 2002
                                                              -----------------------
                                                               ACTUAL     AS ADJUSTED
                                                              --------    -----------
                                                                  (IN THOUSANDS)
                                                                    
DEBT:
  Current portion of long-term debt(1)......................  $ 73,914     $ 73,914
  Long-term debt (less current portion)(1)..................   252,077      179,901
SHAREHOLDERS' EQUITY:
  Preferred stock, par value $.01 per share; authorized
     500,000 shares; none outstanding.......................        --           --
  Common stock, par value $.01 per share; authorized
     100,000,000 shares; outstanding 25,549,358 shares
     actual and 28,549,358 shares as adjusted...............       255          285
  Paid-in capital...........................................   162,740      234,886
  Retained earnings.........................................   137,316      137,316
  Accumulated and other comprehensive loss..................    (4,681)      (4,681)
  Less 37,500 shares of common stock in treasury, at cost...      (419)        (419)
                                                              --------     --------
     Total shareholders' equity.............................   295,211      367,387
                                                              --------     --------
          Total capitalization..............................  $621,202     $621,202
                                                              ========     ========



---------------
(1) Because the revolving commitment under our credit agreement terminates on
    December 31, 2002, the entire amount borrowed under our revolver is
    classified as short term.

                                        15


                            SELECTED FINANCIAL DATA


     The information below sets forth selected financial data as of and for each
of the five years in the period ended December 31, 2001 and the three months
ended March 31, 2001 and 2002. The data for the three years in the period ended
December 31, 2001 and as of December 31, 2000 and 2001 has been derived from and
should be read in conjunction with our consolidated financial statements,
including the notes thereto, included in this prospectus beginning on page F-1,
and "Management's Discussion and Analysis of Financial Condition and Results of
Operations" beginning on page 18. The information for the years ended December
31, 1997 and 1998 and as of December 31, 1997, 1998 and 1999 has been derived
from our audited financial statements not incorporated by reference or included
herein. The selected financial data for the three months ended March 31, 2001
and 2002 are unaudited but, in the opinion of management, reflect all
adjustments (comprising only normal recurring accruals) necessary for a fair
presentation of our consolidated operating results and financial position for
such interim periods. Results for interim periods are not necessarily indicative
of results for the full year or for any other period. We have never paid any
cash dividends.





                                                                                            THREE MONTHS ENDED
                                                   YEAR ENDED DECEMBER 31,                       MARCH 31,
                                     ----------------------------------------------------   -------------------
                                       1997       1998       1999       2000       2001       2001       2002
                                     --------   --------   --------   --------   --------   --------   --------
                                                  (IN THOUSANDS, EXCEPT PER SHARE AND SHARE DATA)
                                                                                                (UNAUDITED)
                                                                                  
STATEMENTS OF INCOME (LOSS)
  DATA(1):
Net sales..........................  $139,632   $339,270   $376,226   $395,873   $428,722   $105,909   $113,205
Cost of sales(2)...................    74,220    169,599    178,480    188,223    204,374     49,674     54,104
Selling and administrative
  expense(3)(4)....................    36,661     96,475    110,842    128,316    140,560     34,829     34,468
Research and development expense...     3,037     12,029     12,108     14,870     14,830      3,696      3,824
Unusual items(3)...................    37,242         --         --         --         --         --         --
                                     --------   --------   --------   --------   --------   --------   --------
  Income (loss) from operations....   (11,528)    61,167     74,796     64,464     68,958     17,710     20,809
Interest income (expense), net.....       823    (30,891)   (32,360)   (34,286)   (30,824)    (8,331)    (6,628)
                                     --------   --------   --------   --------   --------   --------   --------
  Income (loss) before income taxes
    and extraordinary item.........   (10,705)    30,276     42,436     30,178     38,134      9,379     14,181
Provision (benefit) for income
  taxes............................    (3,640)    10,899     15,277     10,864     13,728      3,376      5,105
                                     --------   --------   --------   --------   --------   --------   --------
  Income (loss) before
    extraordinary item.............    (7,065)    19,377     27,159     19,314     24,406      6,003      9,076
Extraordinary item, net of income
  taxes(5).........................        --     (1,569)        --         --         --         --         --
                                     --------   --------   --------   --------   --------   --------   --------
  Net income (loss)................  $ (7,065)  $ 17,808   $ 27,159   $ 19,314   $ 24,406   $  6,003   $  9,076
                                     ========   ========   ========   ========   ========   ========   ========
EARNINGS (LOSS) PER SHARE BEFORE
  EXTRAORDINARY ITEM:
  Basic............................  $  (0.31)  $   0.86   $   1.19   $   0.84   $   1.02   $   0.26   $   0.36
  Diluted..........................  $  (0.31)  $   0.84   $   1.17   $   0.83   $   1.00   $   0.26   $   0.35

EARNINGS (LOSS) PER SHARE:
  Basic............................  $  (0.31)  $   0.79   $   1.19   $   0.84   $   1.02   $   0.26   $   0.36
  Diluted..........................  $  (0.31)  $   0.77   $   1.17   $   0.83   $   1.00   $   0.26   $   0.35

WEIGHTED AVERAGE NUMBER OF COMMON
  SHARES IN CALCULATING:
Basic earnings (loss) per share....    22,496     22,628     22,862     22,967     24,045     23,057     25,397
Diluted earnings (loss) per
  share............................    22,496     22,982     23,145     23,271     24,401     23,307     25,969

OTHER FINANCIAL DATA:
Depreciation and amortization......  $  6,954   $ 23,601   $ 26,291   $ 29,487   $ 30,148   $  7,566   $  5,403
Capital expenditures...............     8,178     12,924      9,352     14,050     14,443      3,867      3,208



                                                   (footnotes on following page)
                                        16





                                                            AT DECEMBER 31,                   AT MARCH 31,
                                                ----------------------------------------   -------------------
                                                 1997       1998       1999       2000       2001       2002
                                                -------   --------   --------   --------   --------   --------
                                                                        (IN THOUSANDS)
                                                                                               (UNAUDITED)
                                                                                    
BALANCE SHEET DATA(6):
Cash and cash equivalents.....................  $13,452   $  5,906   $  3,747   $  3,470   $  1,402   $  2,634
Working capital...............................   95,333     93,424    109,526    113,755     44,712     47,434
Total assets..................................  561,637    628,784    662,161    679,571    701,608    706,950
Long-term debt (including current portion)....  365,000    384,872    394,669    378,748    335,929    325,991
Total shareholders' equity....................  162,736    182,168    211,261    230,603    283,634    295,211



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

(1) Includes, based on the purchase method of accounting, the results of (i) the
    surgical suction product line acquired from the Davol subsidiary of C.R.
    Bard, Inc., from July 1997; (ii) Linvatec Corporation acquired from
    Bristol-Myers Squibb Company, from December 1997; (iii) the arthroscopy
    product line acquired from 3M, from November 1998; (iv) the powered
    instrument product line acquired from 3M Company, from August 1999; and (v)
    the minimally invasive surgical product lines acquired from Imagyn Medical
    Technologies, Inc. in November 2000 and July 2001, in each such case from
    the date of acquisition.


(2) Includes for 1998, $3,000,000 of incremental expense related to the excess
    of the fair value at the acquisition date of Linvatec inventory over the
    cost to produce; includes for 1999, $1,600,000 of incremental expense
    related to the excess of the fair value at the acquisition date over the
    cost to produce inventory related to the powered instrument product line
    acquired from 3M; and includes for 2001, $1,567,000 of transition expenses
    related to the July 2001 acquisition from Imagyn.

(3) Included in unusual items for 1997 are a $34,000,000 non-cash acquisition
    charge for the write-off of all of the in-process research and development
    products (comprised of products in the development stage) acquired in the
    Linvatec acquisition, a $914,000 write-off of deferred financing fees
    resulting from refinancing our loan agreements in connection with the
    Linvatec acquisition, and a $2,328,000 charge for the closing of our Dayton,
    Ohio manufacturing facility. Included in selling and administrative expense
    for 1999 is a $1,256,000 benefit related to a previously recorded litigation
    accrual which was settled on favorable terms. Included in selling and
    administrative expense for 2000 is a severance charge of $1,509,000 related
    to the restructuring of the Company's arthroscopy sales force.


(4) Effective January 1, 2002, the provisions of SFAS 142 were adopted relative
    to the cessation of amortization for goodwill and certain intangibles. Had
    we accounted for goodwill and certain intangibles in accordance with SFAS
    142 for all periods presented, income (loss) before extraordinary item would
    have been $(5,502,000) in 1997, $24,011,000 in 1998, $32,227,000 in 1999,
    $24,969,000 in 2000, $30,061,000 in 2001 and $7,416,000 in the three months
    ended March 31,2001. Had we accounted for goodwill and certain intangibles
    in accordance with SFAS 142 for all periods presented, net income (loss)
    would have been $(5,502,000) in 1997, $24,011,000 in 1998, $32,227,000 in
    1999, $24,969,000 in 2000, $30,061,000 in 2001 and $7,416,000 in the three
    months ended March 31, 2001.


(5) In March 1998, we recorded an extraordinary item of $1,569,000 net of income
    taxes related to the write-off of deferred financing fees.

(6) Linvatec is included in the Balance Sheet Data as of December 31, 1997, its
    date of acquisition, after a one-time non-cash acquisition charge of
    $34,000,000.

                                        17


                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                 FINANCIAL CONDITION AND RESULTS OF OPERATIONS

     The following discussion should be read in conjunction with our "Selected
Financial Data" and our consolidated financial statements.

CRITICAL ACCOUNTING POLICIES

     The accounting policies discussed below are considered by management to be
critical to understanding our financial condition and results of operations.

  ACCOUNTS RECEIVABLE SALE

     On November 1, 2001, we entered into a five-year accounts receivable sales
agreement pursuant to which we and certain of our subsidiaries sell on an
ongoing basis certain accounts receivable to CONMED Receivables Corporation, or
CRC, our wholly-owned special-purpose subsidiary. CRC may in turn sell up to an
aggregate $50.0 million undivided percentage ownership interest in such
receivables to a commercial paper conduit (the "conduit purchaser"). For
receivables that have been sold, we retain collection and administrative
responsibilities as agent for the conduit purchaser. As of March 31, 2002, the
undivided percentage ownership interest in receivables sold by CRC to the
conduit purchaser aggregated $40.0 million, which has been accounted for as a
sale and reflected in the balance sheet as a reduction in accounts receivable.
We used the initial $40.0 million in proceeds from the sale of accounts
receivable in November 2001 to repay a portion of our term loans under our
credit agreement described in Note 5 to our consolidated financial statements.
Expenses associated with the sale of accounts receivable, including the conduit
purchaser's financing cost of issuing commercial paper, were $0.3 million in the
quarter ended March 31, 2002.


     There are certain statistical ratios, primarily related to sales dilution
and losses on accounts receivable, which must be calculated and maintained on
the pool of receivables in order to continue selling to the conduit purchaser.
We believe that additional accounts receivable arising in the normal course of
business will be of sufficient quality and quantity to qualify for sale under
the accounts receivable sales agreement. In the event that new accounts
receivable arising in the normal course of business do not qualify for sale,
then collections on sold receivables will flow to the conduit purchaser rather
than being used to fund new receivable purchases. If this were to occur, we
would need to access an alternate source of working capital.


  GOODWILL AND OTHER INTANGIBLE ASSETS

     Goodwill represents the excess of purchase price over fair value of
identifiable net assets of acquired businesses. Other intangible assets
primarily represent allocations of purchase price to identifiable intangible
assets of acquired businesses. Goodwill and other intangible assets have been
amortized over periods ranging from 5 to 40 years. Because of our history of
growth through acquisitions, goodwill and other intangible assets comprise a
substantial portion (62.4% at March 31, 2002) of our total assets.


     In June 2001, the Financial Accounting Standards Board approved Statement
of Financial Accounting Standards No. 142 "Goodwill and Other Intangible
Assets," or SFAS 142. We adopted SFAS 142 effective January 1, 2002. Under this
standard, amortization of goodwill and certain intangible assets, including
certain intangibles recorded as a result of past business combinations, is to be
discontinued upon adoption of SFAS 142. In addition, in accordance with the
transition provisions of SFAS 142, goodwill recorded as a result of our
acquisition of certain product lines from Imagyn Medical Technologies, Inc. in
July 2001 (the "second Imagyn acquisition") has not been amortized.


     During the quarter ended March 31, 2002, we performed tests of goodwill and
indefinite-lived intangible assets as of January 1, 2002. We tested for
impairment using the two-step process prescribed in SFAS 142. The first step is
a screen for potential impairment. The second step, which has been determined
not to be necessary, measures the amount of any impairment. No impairment losses
have been

                                        18


recognized as a result of these tests. During the quarter ended March 31, 2002,
net income increased by approximately $1.4 million or $.05 per share as a result
of the adoption of SFAS 142.

  DERIVATIVE FINANCIAL INSTRUMENTS


     Effective January 1, 2001, we adopted Statement of Financial Accounting
Standards No. 133, "Accounting for Derivative Instruments and Hedging
Activities," or SFAS 133. SFAS 133 requires that derivatives be recorded on the
balance sheet as assets or liabilities, measured at fair value. Gains or losses
resulting from the changes in the values of the derivatives are accounted for
depending on whether the derivative qualifies for hedge accounting. Upon
adoption of SFAS 133, we recorded a net-of-tax cumulative-effect-type loss
adjustment of $1.0 million in accumulated other comprehensive income to
recognize at fair value an interest rate swap which we have designated as a
cash-flow hedge and which effectively converts $50.0 million of LIBOR-based
floating rate debt under our credit agreement into fixed rate debt with a base
interest rate of 7.01%. During the quarter ended March 31, 2002, gross holding
gains were $0.1 million, before income taxes, while holding losses of $0.6
million, before income taxes, were reclassified and included in net income.
Including the cumulative effect loss adjustment related to the adoption of SFAS
133, total gross holding losses during 2001 related to the interest rate swap
aggregated $4.4 million before income taxes, of which $1.3 million, before
income taxes, has been reclassified and included in net income.


  REVENUE RECOGNITION

     Revenue is recognized when title to the goods and risk of loss pass to our
customers. Amounts billed to customers related to shipping and handling costs
are included in net sales. We assess the risk of loss on accounts receivable and
adjust the allowance for doubtful accounts based on this risk assessment.
Historically, losses on accounts receivable have not been material. Management
believes the allowance for doubtful accounts of $1.5 million at March 31, 2002
is adequate to provide for any potential losses from accounts receivable.

RESULTS OF OPERATIONS

  THREE MONTHS ENDED MARCH 31, 2002 COMPARED TO THREE MONTHS ENDED MARCH 31,
2001

     The following table presents, as a percentage of net sales, certain
categories included in our unaudited consolidated statements of income for the
periods indicated:



                                                                THREE MONTHS
                                                              ENDED MARCH 31,
                                                              ----------------
                                                               2001      2002
                                                              ------    ------
                                                                (UNAUDITED)
                                                                  
Net sales...................................................  100.0%    100.0%
Cost of sales...............................................   46.9      47.8
                                                              -----     -----
  Gross margin..............................................   53.1      52.2
Selling and administrative expense..........................   32.9      30.4
Research and development expense............................    3.5       3.4
                                                              -----     -----
  Income from operations....................................   16.7      18.4
Interest expense, net.......................................    7.8       5.9
                                                              -----     -----
  Income before income taxes................................    8.9      12.5
Provision for income taxes..................................    3.2       4.5
                                                              -----     -----
  Net income................................................    5.7%      8.0%
                                                              =====     =====


     Sales for the quarter ended March 31, 2002 were $113.2 million, an increase
of 6.9% compared to sales of $105.9 million in the same quarter a year ago.
Excluding the effects of the second Imagyn acquisition, sales would have grown
by approximately 1.0%. Fluctuations in foreign currency exchange

                                        19


rates in the first quarter of 2002 as compared to the same period a year ago did
not have a significant effect on sales.

     - Sales in our orthopedic businesses decreased 1.6% to $69.7 million from
       $70.8 million in the comparable quarter last year.

      - Arthroscopy sales, which represented approximately 59.3% of total first
        quarter of 2002 orthopedic revenues, grew 2.7% to $41.3 million from
        $40.2 million in the same period a year ago on strength in sales of
        disposable products and video equipment.

      - Powered surgical instrument sales, which represented approximately 40.7%
        of orthopedic revenues, decreased 7.2% to $28.4 million in the first
        quarter of 2002 from $30.6 million in the same quarter last year, which
        was a record quarter for powered surgical instrument sales. In the last
        three quarters of 2001, powered surgical instrument sales averaged $27.9
        million per quarter. We introduced our PowerPro(R) battery powered
        instrument product line in February 2002, replacing older versions of
        battery powered instruments. First shipments of this new product line
        occurred in March 2002.

     - Patient care sales for the three months ended March 31, 2002 were $17.3
       million, a 1.7% decline from $17.6 million in the same period a year ago,
       driven primarily by declines in sales of our surgical suction product
       lines as a result of significant competition and pricing pressures. Sales
       of ECG and other patient care products were largely stable in the first
       quarter of 2002 as compared with the same period a year ago.

     - Electrosurgery sales for the three months ended March 31, 2002 were $16.8
       million, an increase of 12.0% from $15.0 million in the first quarter of
       last year, driven by strong increases in disposable electrosurgical
       pencil and ground pad sales.

     - Sales of endoscopy products increased to $9.4 million in the three months
       ended March 31, 2002 from $2.5 million in the same period a year ago,
       primarily as a result of the second Imagyn acquisition. Sales of the
       Imagyn product lines contributed approximately $6.5 million in sales in
       the quarter ended March 31, 2002. Excluding the impact of the second
       Imagyn acquisition, endoscopy sales increased approximately 16.0%. In
       July 2001, concurrent with the second Imagyn acquisition, we created a
       separate sales force focused on selling endoscopy products. Previously,
       endoscopy products were sold through the electrosurgery sales force. We
       believe the continued strong sales growth we have experienced in the
       endoscopy product lines was enhanced by the focus provided by a separate,
       dedicated sales force.

     Cost of sales increased to $54.1 million in the first quarter of 2002 as
compared to $49.7 million in the same quarter a year ago as a result of the
increased sales described above, while gross margin percentage declined slightly
to 52.2% in the first quarter of 2002 compared to 53.1% in the first quarter of
2001, primarily as a result of decreased sales of powered surgical instruments
which carry higher gross margins than certain of our other product lines.


     Selling and administrative expense decreased to $34.5 million in the first
quarter of 2002 as compared to $34.8 million in the first quarter of 2001. As a
percentage of sales, selling and administrative expense totaled 30.4% in the
first quarter of 2002 compared to 32.9% in the first quarter of 2001. During the
quarter ended March 31, 2002, selling and administrative expense decreased by
approximately $2.2 million as a result of the adoption of SFAS 142. Excluding
the impact of the adoption of SFAS 142, selling and administrative expense in
the first quarter of 2002 would have been approximately $36.7 million or 32.4%
as a percentage of sales, declining slightly when compared with the same period
a year ago, as a result of the increase in sales.


     Research and development expense increased to $3.8 million in the first
quarter of 2002 as compared to $3.7 million in the first quarter of 2001. This
increase represents continued research and development efforts primarily focused
on new product development in the orthopedic product lines. As a percentage of

                                        20


sales, research and development expense decreased to 3.4% in the first quarter
compared to 3.5% in the same quarter a year ago as a result of higher sales
levels.


     Interest expense in the first quarter of 2002 was $6.6 million compared to
$8.3 million in the first quarter of 2001. The decrease in interest expense is a
result of lower total borrowings during the first quarter as compared to the
same period a year ago, as well as lower weighted average interest rates on the
term loans and revolving credit facility under our credit agreement, which
declined to 4.20% and 3.70% at March 31, 2002 as compared to 7.94% and 8.14% at
March 31, 2001.


  2001 COMPARED TO 2000

     The following table presents, as a percentage of net sales, certain
categories included in our consolidated statements of income for the periods
indicated:



                                                               YEAR ENDED
                                                              DECEMBER 31,
                                                              -------------
                                                              2000    2001
                                                              -----   -----
                                                                
Net sales...................................................  100.0%  100.0%
Cost of sales...............................................   47.5    47.7
                                                              -----   -----
  Gross margin..............................................   52.5    52.3
Selling and administrative expense..........................   32.4    32.8
Research and development expense............................    3.8     3.5
                                                              -----   -----
  Income from operations....................................   16.3    16.0
Interest expense, net.......................................    8.7     7.2
                                                              -----   -----
  Income before income taxes................................    7.6     8.8
Provision for income taxes..................................    2.7     3.1
                                                              -----   -----
  Net income................................................    4.9%    5.7%
                                                              =====   =====


     Sales for 2001 were $428.7 million, an increase of 8.3% compared to sales
of $395.9 million in 2000. Excluding our acquisition of certain product lines
from Imagyn in November 2000 (the "Imagyn acquisition") and July 2001, and
adjusting for constant foreign currency exchange rates, sales would have grown
by approximately 5.2%.

     - Sales in our orthopedic businesses grew 4.3% to $269.9 million in 2001
       from $258.8 million from 2000.

      - Arthroscopy sales, which represented approximately 57.7% of total 2001
        orthopedic revenues, grew 7.2% in 2001 to $155.6 million from $145.1
        million in 2000, on strength in sales of disposable products and video
        equipment.


      - Powered surgical instrument sales, which represented approximately 42.3%
        of total 2001 orthopedic revenues, grew 1.0% to $114.3 million in 2001
        from $113.7 million in 2000. We believe the weakness in sales in the
        powered surgical instrument product line was a result of our aging
        battery-powered product offering, which has since been replaced by our
        new PowerPro(R) battery-powered instrument product line, as we describe
        above. Adjusted for constant foreign currency exchange rates, orthopedic
        sales growth in 2001 would have been approximately 5.5% compared with
        2000, as the value of the Canadian dollar and certain European
        currencies weakened in comparison with the dollar.



     - Patient care sales for 2001 were $69.1 million, a 1.3% increase from
       $68.2 million in 2000, as modest increases in sales of our ECG and other
       patient care product lines more than offset declines in sales of surgical
       suction product lines which occurred as a result of significant
       competition and pricing pressure.


     - Electrosurgery sales for 2001 were $66.9 million, an increase of 7.0%
       from $62.5 million in 2000, driven by increases in electrosurgical pencil
       and other disposable product sales.

                                        21


     - Endoscopy sales for 2001 were $22.8 million, an increase of 256% from
       $6.4 million in 2000. Excluding the impact of the Imagyn acquisitions in
       November 2000 and July 2001, as described in Note 2 to our consolidated
       financial statements, the increase in endoscopy sales was approximately
       13.0%.


     Cost of sales increased to $204.4 million in 2001 compared to $188.2
million in 2000, primarily as a result of the increased sales volumes described
above. As discussed in Notes 2 and 11 to our consolidated financial statements,
during 2001, we incurred various nonrecurring charges in connection with the
July 2001 Imagyn acquisition. These costs were primarily related to the
transition in manufacturing of the Imagyn product lines from Imagyn's Richland,
Michigan facility to our manufacturing plants in Utica, New York. Such costs
totaled approximately $1.6 million and are included in cost of sales. Excluding
the impact of these nonrecurring expenses, cost of sales for 2001 was $202.8
million. Gross margin percentage for 2001, excluding the Imagyn-related charges,
was 52.7%, a slight improvement as a result of increased sales volumes, compared
with 52.5% in 2000. Including the Imagyn-related charges, gross margin
percentage for 2001 was 52.3%.



     Selling and administrative expense increased to $140.6 million in 2001 as
compared to $128.3 million in 2000. As a percentage of sales, selling and
administrative expense totaled 32.8% in 2001 compared to 32.4% in 2000.
Excluding a nonrecurring severance charge of $1.5 million recorded in 2000
related to the restructuring of our orthopedic direct sales force, as described
in Note 11 to our consolidated financial statements, selling and administrative
expense as a percentage of sales were 32.0% in 2000. This restructuring involved
replacing our orthopedic direct sales force with non-stocking exclusive sales
agent groups in certain geographic regions of the United States. This plan
resulted in greater sales force coverage in the affected geographic regions. The
increase in selling and administrative expense in 2001 as compared to 2000 is a
result of higher commission and other costs in 2001 as compared to 2000
associated with the change to exclusive sales agent groups as well as increased
spending on sales and marketing programs.


     Research and development expense totaled $14.8 million in 2001, consistent
with $14.9 million in 2000. As a percentage of sales, research and development
expense decreased to 3.5% in 2001 compared to 3.8% in 2000, as a result of
higher sales levels. Our research and development efforts are focused primarily
on new product development in the orthopedic product lines.


     Interest expense in 2001 was $30.8 million compared to $34.3 million in
2000. The decrease in interest expense is primarily a result of lower weighted
average interest rates on the term loans and revolving credit facility under our
credit agreement, as described in Note 5 to our consolidated financial
statements, which have declined, to 4.43% and 3.93% at December 31, 2001 as
compared to 8.73% and 9.06% at December 31, 2000 resulting in decreased interest
expense.


                                        22


  2000 COMPARED TO 1999

     The following table presents, as a percentage of net sales, certain
categories included in our consolidated statements of income for the periods
indicated:



                                                                YEAR ENDED
                                                               DECEMBER 31,
                                                              --------------
                                                              1999     2000
                                                              -----    -----
                                                                 
Net sales...................................................  100.0%   100.0%
Cost of sales...............................................   47.4     47.5
                                                              -----    -----
  Gross margin..............................................   52.6     52.5
Selling and administrative expense..........................   29.5     32.4
Research and development expense............................    3.2      3.8
                                                              -----    -----
  Income from operations....................................   19.9     16.3
Interest expense, net.......................................    8.6      8.7
                                                              -----    -----
  Income before income taxes................................   11.3      7.6
Provision for income taxes..................................    4.1      2.7
                                                              -----    -----
  Net income................................................    7.2%     4.9%
                                                              =====    =====



     Sales for 2000 were $395.9 million, an increase of 5.2% compared to sales
of $376.2 million in 1999. Excluding our acquisitions of a powered instrument
line from 3M in August 1999, certain product lines from Imagyn in November 2000
and adjusting for constant foreign currency exchange rates, sales would have
grown by approximately 1.3%.


     - Sales in our orthopedic businesses grew 12.0% to $258.8 million in 2000
       from $231.0 million in 1999.

      - Arthroscopy sales, which represented approximately 56.1% of total 2000
        orthopedic revenues, grew 1.0% to $145.1 million in 2000 from $144.1
        million in 1999, as increases in sales of video equipment more than
        offset slight declines in sales of disposable products.


      - Powered surgical instrument sales, which represented approximately 43.9%
        of total 2000 orthopedic revenues, grew 30.8% to $113.7 million in 2000
        from $86.9 million in 1999. Excluding the impact of the acquisition of
        the powered surgical instrument business from 3M in August 1999, as
        described in Note 2 to our consolidated financial statements, the
        increase in powered surgical instrument sales in 2000 compared to 1999
        was approximately 12.1%. Adjusted for constant foreign currency exchange
        rates, orthopedic sales growth in 2000 would have been approximately
        13.4% compared with 1999 as the value of the Canadian dollar and certain
        European currencies weakened in comparison with the dollar.


     - Patient care sales for 2000 were $68.2 million, a 12.6% decrease from
       $78.0 million in 1999, reflecting declines in sales of our ECG and
       surgical suction product lines as a result of increased competition and
       pricing pressure.

     - Electrosurgery sales for 2000 were $62.5 million, consistent with the
       $62.4 million in 1999, reflecting generally flat generator and disposable
       product sales.


     - Endoscopy sales for 2000 were $6.4 million, an increase of 33.3% from
       $4.8 million in 1999. Excluding the impact of the Imagyn acquisition in
       November 2000, as described in Note 2 to our consolidated financial
       statements, the increase in endoscopy sales in 2000 was approximately
       20.8%.



     Cost of sales increased to $188.2 million in 2000 compared to $178.5
million in 1999. Gross margin percentage for 2000 was 52.5%. In connection with
the August 1999 acquisition of the powered surgical instrument business from 3M,
as described in Note 2 to our consolidated financial statements, we increased
the acquired value of inventory by $1.6 million; this inventory was sold in 1999
and served to increase cost of sales by $1.6 million. Excluding the impact of
this nonrecurring purchase accounting

                                        23


adjustment, cost of sales was $176.9 million in 1999 and gross margin percentage
for 1999 was 52.9%. The slight decline in gross margin percentage in 2000 as
compared to 1999 is primarily a result of the negative impact of foreign
currency exchange rate fluctuations discussed above. Excluding the negative
impact of foreign currency exchange rate fluctuations, gross margin percentage
in 2000 would have been 52.8%.


     Selling and administrative expense increased to $128.3 million in 2000 as
compared to $110.8 million in 1999. As a percentage of sales, selling and
administrative expenses totaled 32.4% in 2000 compared to 29.5% in 1999. During
2000, we recorded under selling and administrative expense, a nonrecurring
severance charge of $1.5 million related to the restructuring of our orthopedic
direct sales force, as described in Note 11 to our consolidated financial
statements. This restructuring involved replacing our orthopedic direct sales
force with non-stocking exclusive sales agent groups in certain geographic
regions of the United States. This plan resulted in greater sales force coverage
in the affected geographic regions. During 1999, we recorded in selling and
administrative expense, the nonrecurring $1.3 million benefit of a previously
recorded litigation accrual which was settled on favorable terms. Excluding
these nonrecurring items, as a percentage of sales, selling and administrative
expense increased to 32.0% in 2000 as compared to 29.8% in 1999. This increase,
as a percentage of sales, is a result of increased spending on sales and
marketing programs, including higher commission and other costs associated with
the change to exclusive sales agent groups.


     Research and development expense was $14.9 million in 2000 as compared to
$12.1 million in 1999. As a percentage of sales, research and development
expense increased to 3.8% in 2000 as compared to 3.2% in 1999. This increase
represents expanded research and development efforts primarily focused on new
product development in the orthopedic product lines.


     Interest expense in 2000 was $34.3 million compared to $32.4 million in
1999. The increase in interest expense is primarily a result of higher weighted
average interest rates on the term loans and revolving credit facility under our
credit agreement, as described in Note 5 to our consolidated financial
statements, which increased to 8.73% and 9.06% at December 31, 2000 as compared
to 8.00% and 7.45% at December 31, 1999 resulting in increased interest expense.


LIQUIDITY AND CAPITAL RESOURCES


     Cash generated from our operations and borrowings under our revolving
credit facility have traditionally provided the working capital for our
operations, debt service under our credit facility and the funding of our
capital expenditures. In addition, we have used term borrowings, including:



     - borrowings under our credit facility;



     - Senior Subordinated Notes issued to refinance borrowings under our credit
       facility, in the case of the Linvatec acquisition in 1997; and



     - borrowings under separate loan facilities, in the case of real property
       acquisitions, to finance our acquisitions. Following the use of the
       proceeds of the offering to repay term loan borrowings under our credit
       facility, we expect to continue to use cash flow from our operations and
       borrowings under our revolving credit facility to finance our operations,
       our debt service under our credit facility and the funding of our capital
       expenditures.



     Our term loans under our credit facility at March 31, 2002 aggregated
$115.9 million. Our term loans are repayable quarterly over remaining terms of
approximately three years. Our credit facility also includes a $100.0 million
revolving credit facility which expires December 2002, of which $43.0 million
was available at March 31, 2002. The borrowings under the credit facility carry
interest rates based on a spread over LIBOR or an alternative base interest
rate. The weighted average interest rates at March 31, 2002 under the term loans
and the revolving credit facility were 4.20% and 3.70%.



     The Senior Subordinated Notes are in aggregate principal amount of $130.0
million, have a maturity date of March 15, 2008 and bear interest at 9.0% per
annum which is payable semiannually.


                                        24



     We used term loans to purchase the property in Largo, Florida utilized by
our Linvatec subsidiary. The term loans consist of a Class A note bearing
interest at 7.50% per annum with semiannual payments of principal and interest
through June 2009, a Class C note bearing interest at 8.25% per annum compounded
semiannually through June 2009, after which semiannual payments of principal and
interest will commence, continuing through June 2019 and a seller-financed note
bearing interest at 6.50% per annum with monthly payments of principal and
interest through July 2013. The principal balances outstanding on the Class A
note, Class C note and seller-financed note aggregate $11.7 million, $6.5
million and $4.1 million at March 31, 2002.


     Our net working capital position was $47.4 million at March 31, 2002 as
compared to $44.7 million at December 31, 2001. Included in net working capital
is $57.0 million owed on our revolving credit facility which terminates on
December 31, 2002. We have begun discussions with our bank group regarding
extending the revolving credit facility or, as an alternative, renegotiating the
entire senior credit agreement. Based on our current discussions, we believe
that we will be able to successfully complete a senior credit arrangement which
will provide sufficient capital for our business. However, because of changed
economic conditions compared to market conditions in 1997 when our present
credit agreement was completed, we expect, based on discussions with our bank
group and current market conditions, that any new facility will carry interest
costs 75 to 100 basis points higher than our present credit agreement. Based on
the amounts outstanding at March 31, 2002 under the credit agreement, an
increase of 75 to 100 basis points would result in an increase in annual
interest expense of approximately $1.3 million to $1.7 million.

     On November 1, 2001, we entered into a five-year accounts receivable sales
agreement pursuant to which we and certain of our subsidiaries sell on an
ongoing basis certain accounts receivable to CONMED Receivables Corporation, a
wholly-owned special-purpose subsidiary. CRC may in turn sell up to an aggregate
$50.0 million undivided percentage ownership interest in those receivables to a
commercial paper conduit. As of March 31, 2002 and December 31, 2001, the
undivided percentage ownership interest in receivables sold by CRC to a
commercial paper conduit aggregated $40.0 million, which has been accounted for
as a sale and reflected in the balance sheet as a reduction in accounts
receivable. We used the $40.0 million in proceeds from the sale of accounts
receivable in November 2001 to repay a portion of our term loans under our
credit agreement described in Note 5 to our consolidated financial statements.
The sale of accounts receivable is expected to enable us to lower our cost of
capital by approximately $0.5 million annually by effectively accessing the
commercial paper market. There are certain statistical ratios primarily related
to sales dilution and losses on accounts receivable which must be calculated and
maintained on the pool of receivables in order to continue selling to the
conduit purchaser. Management believes that additional accounts receivable
arising in the normal course of business will be of sufficient quality and
quantity to qualify for sale under the accounts receivable sales agreement. In
the event that new accounts receivable arising in the normal course of business
do not qualify for sale, then collections on sold receivables will flow to the
conduit purchaser rather than being used to fund new receivable purchases. If
this were to occur, we would need to access an alternate source of working
capital.


     Net cash provided by operations, which we also refer to as "operating cash
flow," increased to $12.4 million for the first three months of 2002 compared to
$11.1 million for the same period in 2001, primarily as a result of higher net
income. In reconciling net income to operating cash flow, operating cash flow in
the first quarter of 2002 was positively impacted by depreciation, amortization
and increases in accounts payable and deferred income taxes and negatively
impacted primarily by an increase in inventory and decreases in accrued
compensation and accrued interest. The increase in inventory is primarily
related to expected increases in sales. The increases in accounts payable and
deferred income taxes and decreases in accrued compensation and interest are
primarily related to the timing of the payment of these liabilities.



     Net cash provided by operations was $77.1 million in 2001. Operating cash
flow increased substantially in 2001 compared with 2000 and 1999 as a result of
the sale of accounts receivable as noted above, which increased operating cash
flows by $40.0 million. Excluding the effects of the receivable sale, operating
cash flow was $37.1 million in 2001. In reconciling net income to operating cash
flow, operating cash flow in 2001 was positively impacted primarily by
depreciation, amortization and deferred income taxes and negatively impacted
primarily as a result of increases in inventory and accounts receivable

                                        25



(excluding the effects of the receivables sale) as a result of the second Imagyn
acquisition and overall higher sales levels experienced in 2001.



     Net cash provided by operations was $36.0 million in 2000. Operating cash
flow in 2000 declined compared with $37.4 million in 1999 primarily as a result
of lower net income in 2000 as compared to 1999. In reconciling net income to
operating cash flow, operating cash flow in 2000 was positively impacted
primarily by depreciation, amortization and deferred income taxes and negatively
impacted primarily as a result of increased inventories and accounts receivable
as a result of overall higher sales levels in 2000 than 1999.



     Net cash provided by operations was $37.4 million in 1999. Operating cash
flow in 1999 was positively impacted primarily by depreciation, amortization and
deferred income taxes. In reconciling net income to operating cash flow,
operating cash flow in 1999 was negatively impacted primarily as a result of
increases in accounts receivable and inventories. The increase in accounts
receivable and inventory was primarily related to the increase in sales compared
with the prior year.



     Capital expenditures in the three months ended March 31, 2002 were $3.2
million compared to $3.9 million in the same period a year ago. Capital
expenditures for 2001, 2000 and 1999 amounted to $14.4 million, $14.1 million,
and $9.4 million. These capital expenditures represent the ongoing capital
investment requirements of our business and are expected to continue at the rate
of approximately $12.0 to $14.0 million annually.



     Net cash used by investing activities in 2000 included $6.0 million paid
related to the Imagyn acquisition. Net cash used by investing activities in 1999
included $40.6 million paid related to the acquisition of the powered surgical
instrument business from 3M in August 1999, as described in Note 2 to our
consolidated financial statements.


     Financing activities in the three months ended March 31, 2002 consisted
primarily of scheduled payments of $8.9 million on our term loans and $1.0
million in repayments under our revolving credit facility. Financing activities
in the three months ended March 31, 2001 consisted primarily of scheduled
payments of $9.0 million on our term loans and $3.0 million in borrowings under
our revolving credit facility. Proceeds from the issuance of common stock
related to our employee incentive stock option plans totaled $2.0 million in the
three months ended March 31, 2002 as compared to $.5 million in the three months
ended March 31, 2001.


     Financing activities in 2001 include $11.0 million in borrowings under the
revolving credit facility, $36.4 million in scheduled payments on our term
loans, and $40.0 million in additional payments on our term loans with the
proceeds from the accounts receivable sale discussed above. Financing activities
in 2000 include $17.0 million in borrowings under the revolving credit facility
and $32.9 million in scheduled payments on our term loans. Financing activities
during 1999 include a $40.0 million term loan used to fund the acquisition of
the powered surgical instrument business from 3M Company in August 1999,
scheduled payments of $23.1 million on our previously existing term loans and
$8.0 million in repayments on our revolving credit facility. Proceeds from the
issuance of common stock related to our employee incentive stock option plans
totaled $1.8 million in 2001, $0.4 million in 2000 and $1.6 million in 1999.


     Assuming the successful renegotiation of the revolving credit facility
discussed above, management believes that cash generated from operations, our
current cash resources and funds available under our revolving credit facility
will provide sufficient liquidity to ensure continued working capital for
operations, debt service and funding of capital expenditures in the foreseeable
future.

                                        26


CONTRACTUAL OBLIGATIONS

     There were no capital lease obligations or unconditional purchase
obligations as of March 31, 2002. The following table summarizes our contractual
obligations related to operating leases and long-term debt as of March 31, 2002:



                          2002       2003       2004       2005       2006     THEREAFTER
                         -------    -------    -------    -------    ------    ----------
                                                  (IN THOUSANDS)
                                                             
Long-term debt.........  $63,368    $43,364    $36,749    $35,181    $1,943     $145,386
Operating lease
  obligations..........    1,300      1,255      1,036        962       933        1,950
                         -------    -------    -------    -------    ------     --------
Total contractual cash
  obligations..........  $64,668    $44,619    $37,785    $36,143    $2,876     $147,336
                         =======    =======    =======    =======    ======     ========


     Included in long-term debt obligations in 2002 is $57.0 million due under
our revolving credit facility.


     As indicated under "Liquidity and Capital Resources," we have begun
discussions with our bank group regarding extending our revolving credit
facility or, as an alternative, renegotiating our entire senior credit
agreement. If those negotiations are successful, payments on a portion of our
long-term debt due in 2002 through 2005, including the current portion of that
long-term debt represented by our revolving credit facility, would be due at
later dates.



     As indicated under "Use of Proceeds," we will use the net proceeds from
this offering to repay outstanding debt under our credit agreement. On a pro
forma basis, assuming net proceeds from this offering of $72.2 million, after
giving effect to the application of the net proceeds from this offering to repay
term loans and without considering any changes to payment dates as a result of a
negotiation of our credit facility, the amount of long-term debt due in 2003
would be reduced to about $32 million and the amount of long-term debt due in
2004 would be reduced to about $2 million.


                                        27


                                    BUSINESS

GENERAL


     CONMED Corporation is a medical technology company specializing in
instruments, implants and video equipment for arthroscopic sports medicine, and
powered surgical instruments, such as drills and saws, for orthopedic, ENT,
neuro-surgery and other surgical specialties. We are also a leading developer,
manufacturer and supplier of advanced surgical devices, including radio
frequency, or RF, electrosurgery systems used routinely to cut and cauterize
tissue in nearly all types of surgical procedures worldwide, and endoscopy
products, such as trocars, clip appliers, scissors and surgical staplers. We
also manufacture and sell a full line of ECG electrodes for heart monitoring and
other patient care products. Our products are used in a variety of clinical
settings, such as operating rooms, surgery centers, physicians' offices and
critical care areas of hospitals.


     We have used strategic business acquisitions to broaden our product
offerings, to increase our market share in certain product lines and to realize
economies of scale. Since 1997, we have completed six strategic business
acquisitions. The completed acquisitions, together with internal growth, have
resulted in a compound annual growth rate in net sales of 32% between 1997 and
2001.

INDUSTRY

     The growth in the markets for our products is primarily driven by:


     - FAVORABLE DEMOGRAPHICS.  The number of surgical procedures performed is
       increasing. This growth in surgical procedures reflects demographic
       trends, such as the aging of the population, and technological
       advancements, which result in safer and less invasive surgical
       procedures. Additionally, as people are living longer, more active lives,
       they are engaging in contact sports and activities such as running,
       skiing, rollerblading, golf and tennis which result in injuries with
       greater frequency and at an earlier age than ever before. Sales of our
       surgical products represented over 85% of our total 2001 sales. See
       "--Our Products."



     - CONTINUED PRESSURE TO REDUCE HEALTH CARE COSTS.  In response to rising
       health care costs, managed care companies and other third-party payers
       have placed pressure on health care providers to reduce costs. As a
       result, health care providers have focused on the high cost areas such as
       surgery. To reduce costs, health care providers use minimally invasive
       techniques, which generally reduce patient trauma, recovery time and
       ultimately the length of hospitalization. Many of our products are
       designed for use in minimally invasive surgical procedures. See "--Our
       Products." Health care providers are also increasingly purchasing
       single-use disposable products, which reduce the costs associated with
       sterilizing surgical instruments and products following surgery. The
       single-use nature of disposable products lowers the risk of incorrectly
       sterilized instruments spreading infection into the patient and
       increasing the cost of post-operative care. Approximately 75% of our
       sales are derived from single-use disposable products.



       In the United States, the pressure on health care providers to contain
       costs has altered their purchasing patterns for general surgical
       instruments and disposable medical products. Many health care providers
       have entered into comprehensive purchasing contracts with fewer
       suppliers, which offer a broader array of products at lower prices. In
       addition, many health care providers have aligned themselves with GPOs or
       IHNs, which aggregate the purchasing volume of their members in order to
       negotiate competitive pricing with suppliers, including manufacturers of
       surgical products. We believe that these trends will favor entities that
       offer a broad product portfolio. See "--Business Strategy" below.



     - INCREASED GLOBAL MEDICAL SPENDING.  We believe that foreign markets offer
       growth opportunities for our products. We currently distribute our
       products through our own sales subsidiaries or through local dealers in
       over 100 foreign countries. International sales represented approximately
       29% of total sales in 2001.


                                        28


COMPETITIVE STRENGTHS

     We believe that we have a top two or three market share position in each of
our five key product areas and have established our position as a market leader
by capitalizing on the following competitive strengths:


     - STRONG BRAND RECOGNITION.  We are a leading provider of arthroscopic
       surgery devices, electrosurgical systems, powered surgical instruments
       and ECG electrodes. Our products are sold under leading brand names,
       including CONMED(R), Linvatec(R) and Hall Surgical(R). These brand names
       are well recognized by physicians for quality and service. We believe
       that brand recognition helps drive demand for our products by enabling us
       to build upon the reputation for quality and service associated with
       these brands and gain faster acceptance when introducing new branded
       products.


     - BREADTH OF PRODUCT OFFERING.  The breadth of our product lines in our key
       product areas enables us to meet a wide range of customer requirements
       and preferences. In three of our five key product areas, we are only one
       of two providers that offers a full line of products. For example, we
       offer a complete set of the arthroscopy products a surgeon requires for
       most arthroscopic procedures, including instrument and repair sets,
       implants, shaver consoles and handpieces, video systems and related
       disposables. This in turn has enhanced our ability to market our products
       to surgeons, hospitals, surgery centers, GPOs, IHNs and other customers,
       particularly as institutions seek to reduce costs and to minimize the
       number of suppliers.


     - SUCCESSFUL INTEGRATION OF ACQUISITIONS.  Since 1997, we have completed
       six acquisitions, including the 1997 acquisition of Linvatec Corporation
       which more than doubled our size. These acquisitions have enabled us to
       broaden our product categories, expand our sales and distribution
       capabilities and increase our international presence. Our management
       team, which averages more than 15 years of experience in the health care
       industry, has demonstrated a historical ability to identify complementary
       acquisitions and to integrate acquired companies into our operations.



     - EXTENSIVE MARKETING AND DISTRIBUTION INFRASTRUCTURE.  We market our
       products domestically through our sales force consisting of approximately
       210 employee sales representatives and an additional 90 sales
       professionals employed by eight non-stocking sales agent groups, seven of
       which are exclusive. All of our sales professionals are highly trained
       and educated in the applications or procedures for the products they
       sell. They call directly on surgeons, hospital departments, outpatient
       surgery centers and physician offices. Additionally, we have an
       international presence through sales subsidiaries and branches located in
       key international markets. We sell direct to hospital customers in these
       markets with an employee-based international sales force of approximately
       40 sales representatives. We also maintain distributor relationships
       domestically and in numerous countries worldwide. See "--Marketing."


     - VERTICALLY INTEGRATED MANUFACTURING.  We manufacture most of our products
       and components. Our vertically integrated manufacturing process has
       allowed us to provide quality products, to react quickly to changes in
       demand and to generate manufacturing efficiencies, including purchasing
       raw materials used in a variety of disposable products in bulk. We
       believe that these manufacturing capabilities allow us to contain costs,
       control quality and maintain security of proprietary processes. We
       continually evaluate our manufacturing processes with the objective of
       increasing automation, streamlining production and enhancing efficiency
       in order to achieve cost savings, while seeking to improve quality.


     - RESEARCH AND DEVELOPMENT EXPERTISE.  Our research and development effort
       is focused on introducing new products, enhancing existing products and
       developing new technologies. During the last two years, we have
       introduced more than 24 products and product enhancements. Our reputation
       as an innovator is exemplified by our "first-to-market" product
       introductions, which include the Envision(TM) Autoclavable Three Chip
       Camera Head, Advantage(TM) drive system, the Trident(TM)resection
       ablator, the SureCharge(TM) battery sterilization system and the 2.9
       millimeter arthroscopy scope. Research and development expenditures were
       $14.8 million in 2001.


                                        29


BUSINESS STRATEGY

     Our business strategy is to continue to strengthen our position as a market
leader in our key product areas. The elements of our strategy include:

     - INTRODUCE NEW PRODUCTS AND PRODUCT ENHANCEMENTS.  We will continue to
       pursue organic growth by developing new products and enhancing existing
       products to respond to customer needs and preferences. We are continually
       seeking to develop new technologies to improve durability, performance
       and usability of existing products. In addition to our research and
       development, we receive new ideas for products and technologies,
       especially in procedure-specific areas, from surgeons, inventors and
       operating room personnel.

     - PURSUE STRATEGIC ACQUISITIONS.  We believe that strategic acquisitions
       represent a cost-effective means of broadening our product line. We have
       historically targeted companies with proven technologies and established
       brand names that provide potential sales, marketing and manufacturing
       synergies. Since 1997, we have completed six acquisitions, expanding our
       product line to include arthroscopy products, powered surgical
       instruments and most recently endoscopy products.

     - REALIZE MANUFACTURING AND OPERATING EFFICIENCIES.  We will continue to
       review opportunities for consolidating product lines and streamlining
       production. We believe our vertically integrated manufacturing processes
       can produce further opportunities to reduce overhead and to increase
       operating efficiencies and capacity utilization.

     - MAINTAIN STRONG INTERNATIONAL SALES GROWTH.  We believe there are
       significant sales opportunities for our surgical products outside the
       United States. We intend to maintain our international sales growth and
       increase our penetration into international markets by utilizing our
       relationships with foreign surgeons, hospitals and third-party payers, as
       well as foreign distributors. In 2001, our sales outside the United
       States grew by 14% and represented 29% of our 2001 sales.

OUR PRODUCTS

     The following table sets forth the percentage of net sales for each
category of our products for 1999, 2000 and 2001:



                                                          YEAR ENDED DECEMBER 31,
                                                       ------------------------------
                                                         1999       2000       2001
                                                       --------   --------   --------
                                                                    
Arthroscopy..........................................        38%        36%        36%
Powered surgical instruments.........................        23         29         27
Electrosurgery.......................................        17         16         16
Patient Care.........................................        21         17         16
Endoscopy............................................         1          2          5
                                                       --------   --------   --------
  Total..............................................       100%       100%       100%
                                                       ========   ========   ========
Net sales (in thousands).............................  $376,226   $395,873   $428,722
                                                       ========   ========   ========


  ARTHROSCOPY

     We offer a broad line of devices and products for use in arthroscopic
surgery. Arthroscopy refers to diagnostic and therapeutic surgical procedures
performed on joints with the use of minimally-invasive arthroscopes and related
instruments. Minimally-invasive arthroscopy procedures enable surgical repairs
to be completed with less trauma to the patient, resulting in shorter recovery
times and cost savings. About 75% of all arthroscopy is performed on the knee,
although arthroscopic procedures are increasingly performed on shoulders and
smaller joints, such as the wrist and ankle.

     Our arthroscopy products include powered resection instruments,
arthroscopes, reconstructive systems, tissue repair sets, fluid management
systems, imaging products, implants and related disposable products.

                                        30


It is our standard practice to transfer some of these products, such as shaver
consoles and pumps, to certain customers at no charge. These capital
"placements" allow for and accommodate the use of a variety of disposable
products, such as shaver blades, burs and pump tubing. We have benefited from
the introduction of new products and new technologies in the arthroscopic area,
such as bioresorbable screws, ablators, "push-in" and "screw-in" suture anchors,
resection shavers and cartilage repair implants.

     The majority of arthroscopic procedures are performed to repair injuries
that have occurred in the joint areas of the body. Many of these injuries are
the result of sports related events or other traumas. This explains why
arthroscopy is sometimes referred to as "sports medicine."




                                        ARTHROSCOPY
-------------------------------------------------------------------------------------------
            PRODUCT                        DESCRIPTION                    BRAND NAME
--------------------------------  ------------------------------   ------------------------
                                                             
Ablators and Shaver Ablators      Electrosurgical ablators and     Advantage(TM)
                                  resection ablators to resect     ESA(TM)
                                  and remove soft tissue and       Sterling(R)
                                  bone; used in knee, shoulder     UltrAblator(TM)
                                  and small joint surgery.         Heatwave(TM)
                                                                   Trident(R)
Knee Reconstructive Systems       Products used in cruciate        Paramax(R)
                                  reconstructive surgery;          Pinn-ACL(R)
                                  includes instrumentation,        GraFix(TM)
                                  screws, pins and ligament
                                  harvesting and preparation
                                  devices.
Soft Tissue Repair Systems        Instrument systems designed to   Spectrum(R)
                                  attach specific torn or          Inteq(R)
                                  damaged soft tissue to bone or   Shuttle Relay(TM)
                                  other soft tissue in the knee,   Blitz(R)
                                  shoulder and wrist; includes
                                  instrumentation, guides, hooks
                                  and suture devices.
Fluid Management Systems          Disposable tubing sets,          Apex(R)
                                  disposable and reusable inflow   Quick-Flow(R)
                                  devices, pumps and               Quick-Connect(R)
                                  suction/waste management
                                  systems for use in
                                  arthroscopic and general
                                  surgeries.
Imaging                           Surgical video systems for       Apex(R)
                                  endoscopic procedures;           8180 Series
                                  includes autoclavable single     Envision(TM)
                                  and three-chip camera heads      Autoclavable Three
                                  and consoles, endoscopes,          Chip Camera Head
                                  light sources, monitors, VCRs
                                  and printers.
Implants                          Products including               BioScrew(R)
                                  bioabsorbable and metal          BioStinger(R)
                                  interference screws and suture   BioAnchor(R)
                                  anchors for attaching soft       BioTwist(R)
                                  tissue to bone in the knee,      Ultrafix(R)
                                  shoulder and wrist as well as    Revo(R)
                                  miniscal repair.                 Super Revo(R)
Other Instruments and             Forceps, graspers, punches,      Shutt(R)
  Accessories                     probes, sterilization cases      Concept(R)
                                  and other general instruments    TractionTower(R)
                                  for arthroscopic procedures.



 POWERED SURGICAL INSTRUMENTS

     Powered surgical instruments are used to perform orthopedic, arthroscopic
and other surgical procedures, such as cutting, drilling or reaming and are
driven by electric, battery or pneumatic power. Each instrument consists of one
or more handpieces and related accessories as well as disposable and limited
reuse items (e.g., burs, saw blades, drills and reamers). Powered instruments
are generally

                                        31


categorized as either small bone, large bone or specialty powered instruments.
Specialty powered instruments include surgical applications such as spine,
neurosurgery, otolaryngology (ENT), oral/maxillofacial surgery, and
cardiothoracic surgery.


     Our line of powered instruments is sold principally under the Hall(R)
Surgical brand name, for use in large and small bone orthopedic, arthroscopic,
oral/maxillofacial, podiatric, plastic, otolaryngologic, neurological, spine and
cardiothoracic surgeries. Large bone, neurosurgical, spine and cardiothoracic
powered instruments are sold primarily to hospitals, while small bone
arthroscopic, otolaryngological and oral/maxillofacial powered instruments are
sold to hospitals, outpatient facilities and physician offices. Our Linvatec
subsidiary has devoted substantial resources to developing a new technology base
for large bone, small bone, arthroscopic, neurosurgical, spine and
otolaryngological instruments that can be easily adapted and modified for new
procedures.



     Our powered instruments line also includes our recently introduced
PowerPro(R) Battery System, which is a full function orthopedic power system
specifically designed to meet the requirements of most orthopedic applications.
The PowerPro(R) Battery System has a Surecharge(TM) option that allows the user
to sterilize the battery before it is charged. This ensures that the battery
will be fully charged when delivered to the operating room, unlike other battery
systems currently available on the market. The PowerPro(R) uses a process we
invented for maintaining sterility during the charging process, thus avoiding
the loss of battery charge during sterilization, a problem frequently
encountered by competing battery systems during sterilization.





                               POWERED SURGICAL INSTRUMENTS
------------------------------------------------------------------------------------------
          PRODUCT                           DESCRIPTION                     BRAND NAME
---------------------------  -----------------------------------------  ------------------
                                                                  
Large Bone                   Powered saws, drills and related           Hall(R) Surgical
                             disposable accessories for use primarily   MaxiDriver(TM)
                             in total knee and hip joint replacements   VersiPower(R) Plus
                             and trauma surgical procedures.            Series 4(R)
                                                                        PowerPro(R)
                                                                        Advantage(TM)
                                                                        SureCharge(TM)
Small Bone                   Powered saws, drills and related           Hall(R) Surgical
                             disposable accessories for small bones     E9000(R)
                             and joint surgical procedures.             MiniDriver(TM)
                                                                        MicroChoice(R)
                                                                        Micro 100(TM)
                                                                        Advantage(TM)
Otolaryngology Neurosurgery  Specialty powered saws, drill and related  Hall(R) Surgical
Spine                        disposable accessories for use in          E9000(R)
                             neurosurgery, spine, and otolaryngologic   UltraPower(R)
                             procedures.                                Hall Osteon(R)
                                                                        Hall Ototome(R)
Cardiothoracic               Powered sternum saws, drills, and related  Hall(R) Surgical
Oral/Maxillofacial           disposable accessories for use by          E9000(R)
                             cardiothoracic and oral/maxillofacial      UltraPower(R)
                             surgeons.                                  Micro 100(TM)
                                                                        VersiPower(R)Plus




     Electrosurgery is the technique of using a high-frequency electric current
which, when applied to tissue through special instruments, can be used to cut
tissue, coagulate, or cut and coagulate simultaneously. Radio frequency ("RF")
is the form of high frequency electric current that is used in electrosurgery.
An electrosurgical system consists of a generator, an active electrode in the
form of a cautery pencil or other instrument, which the surgeon uses to apply
the current from the generator to the


                                        32



target tissue, and a ground pad to safely return the current to the generator.
Electrosurgery is routinely used in most forms of surgery, including general,
dermatologic, thoracic, orthopedic, urologic, neurosurgical, gynecological,
laparoscopic, arthroscopic and other endoscopic procedures.



     Our electrosurgical products include electrosurgical pencils and blades,
ground pads, generators, the argon-beam coagulation system (ABC(R)) and related
disposable products. ABC(R) technology is a special method of electrosurgery,
which allows a faster and more complete coagulation of many tissues as compared
to conventional electrosurgery. Unlike conventional electrosurgery, the
electrical current travels in a beam of ionized argon gas, allowing the current
to be dispersed onto the bleeding tissue without the instrument touching the
tissue. Clinicians have reported notable benefits of ABC(R) over traditional
electrosurgical coagulation in certain clinical situations, including
open-heart, liver, spleen and trauma surgery.





                                      ELECTROSURGERY
------------------------------------------------------------------------------------------
          PRODUCT                           DESCRIPTION                     BRAND NAME
---------------------------  -----------------------------------------  ------------------
                                                                  
Pencils                      Disposable and reusable instruments        Hand-trol(R)
                             designed to deliver high-frequency         Gold Line(R)
                             electric current to cut and/or coagulate   Clear Vac(R)
                             tissue.
Ground Pads                  Disposable ground pads to safely return    Macrolyte(R)
                             the current to the generator; available    Bio-gard(R)
                             in adult, pediatric and infant sizes.      SureFit(R)
Blades                       Surgical blades and accessory electrodes   UltraClean(TM)
                             that use a proprietary coating to
                             eliminate tissue buildup on the blade
                             during surgery.
Generators                   Monopolar and bipolar generators for       EXCALIBUR Plus
                             surgical procedures performed in a         PC(R)
                             hospital, physician's office or clinical   SABRE(R)
                             setting.                                   Hyfrecator(R)2000
Argon Beam Coagulation       Specialized electrosurgical generators,    ABC(R)
Systems                      disposable hand pieces and ground pads     Beamer Plus(R)
                             for enhanced non-contact coagulation of    System 7500(TM)
                             tissue.                                    ABC Flex(R)



 PATIENT CARE


     We manufacture a variety of patient care products for use in monitoring
cardiac rhythms, wound care management and IV therapy. These products include
ECG electrodes and cables, wound dressings and catheter stabilization dressings.
Our patient care product lines also include disposable surgical suction
instruments and connecting tubing. The majority of our sales in this category
are derived from the sale of ECG electrodes and surgical suction instruments and
tubing. Although wound management and intravenous therapy product sales are
comparatively small, the application of these products in the operating room
complements our surgical product offerings.


                                        33




                                  PATIENT CARE PRODUCTS
------------------------------------------------------------------------------------------
          PRODUCT                           DESCRIPTION                     BRAND NAME
---------------------------  -----------------------------------------  ------------------
                                                                  
ECG Monitoring               Line of disposable electrodes, monitoring  CONMED(R)
                             cables, lead wire products and             Ultratrace(R)
                             accessories designed to transmit ECG       Cleartrace(R)
                             signals from the heart to an ECG monitor
                             or recorder.
Wound Care                   Disposable transparent wound dressings     ClearSite(R)
                             comprising proprietary hydrogel; able to   Hydrogauze(R)
                             absorb 2 1/2 times its weight in wound     SportPatch(TM)
                             exudate.
Patient Positioners          Products that properly and safely          Airsoft(TM)
                             position patients while in surgery.
Surgical Suction             Disposable surgical suction instruments    CONMED(R)
Instruments and Tubing       and connecting tubing, including
                             Yankauer, Poole, Frazier and
                             Sigmoidoscopic instrumentation, for use
                             by physicians in the majority of open
                             surgical procedures.
Intravenous Therapy          Disposable IV drip rate gravity            VENI-GARD(R)
                             controller and disposable catheter         MasterFlow(R)
                             stabilization dressing designed to hold    Stat 2(R)
                             and secure an IV needle or catheter for
                             use in IV therapy.
Defibrillator Pads and       Stimulation electrodes for use in          PadPro(TM)
Accessories                  emergency cardiac response and for
                             conduction studies of the heart.


  ENDOSCOPY


     Endoscopic surgery (also called laparoscopic surgery) is surgery performed
without a major incision, which results in less trauma for the patient and
produces important cost savings as a result of reduced hospitalization and
therapy. Endoscopic surgery is performed on organs in the abdominal cavity such
as the gallbladder, appendix and female reproductive organs. During a procedure,
devices called "trocars" are used to puncture the abdominal wall and then are
removed, leaving in place a trocar cannula. The trocar cannula provides access
into the abdomen for camera systems and surgical instruments. Some of our
endoscopic instruments are "reposable," which means that the instrument has a
disposable and a reusable component.



     Our endoscopy products include the Reflex(R) clip applier for vessel and
duct ligation, Universal S/I(TM) (suction/irrigation) and Universal Plus(R)
laparoscopic instruments, and specialized, suction/irrigation electrosurgical
instrument systems for use in laparoscopic surgery and the Trogard Finesse(R)
which incorporates a blunt-tipped version of a trocar. The Trogard Finesse(R)
dilates access through the body wall rather than cutting with the sharp, pointed
tips of conventional trocars. This results in smaller wounds and less bleeding.
We also market cutting trocars, suction/irrigation accessories, laparoscopic
scissors, active electrodes, insufflation needles, linear cutters and staplers,
and ABC(R) handpieces for use in laparoscopic surgery. Disposable skin staplers
are used to close large skin incisions with surgical staples eliminating the
time consuming suturing process.


                                        34





                                         ENDOSCOPY
--------------------------------------------------------------------------------------------
             PRODUCT                        DESCRIPTION                    BRAND NAME
---------------------------------  ------------------------------   ------------------------
                                                              
Trocars                            Disposable and reposable         Finesse(R)
                                   devices used to puncture the     Reflex(R)
                                   abdominal wall to provide        Detach a Port(R)
                                   access to the abdominal cavity
                                   for camera systems and
                                   instruments.
Multi-Functional
Electrosurgery and Suction/
Irrigation Instruments             Instruments for cutting and      Universal(TM)
                                   coagulating tissue by            Universal Plus(TM)
                                   delivering high-frequency        FloVac(R)
                                   current. Instruments that
                                   deliver irrigating fluid to
                                   the tissue and remove blood
                                   and fluids from the internal
                                   operating field.

Clip Appliers                      Disposable devices for           Reflex(R)
                                   ligating blood vessels and
                                   ducts by placing a titanium
                                   clip on the vessel.
Laparoscopic Instruments           Scissors, graspers.              Detach a Tip(R)
Skin Staplers                      Disposable devices that place    Reflex(R)
                                   surgical staples to close a
                                   surgical incision.
Microlaparoscopy scopes and
Instruments                        Small laparoscopes and           MicroLap(R)
                                   instruments for performing
                                   surgery through very small
                                   incisions.



MARKETING

     In the United States, most of the Company's products are marketed directly
to more than 6,000 hospitals, and to surgeons and other health care facilities.


     Approximately 24% of the Company's net sales in 2001 were to customers
affiliated with GPOs, IHNs and other large national or regional accounts and 1%
of 2001 net sales were to the Veterans Administration and other hospitals
operated by the federal government. For hospital inventory management purposes,
certain of our customers prefer to purchase our products through independent,
third-party medical product distributors. Approximately 26% of our 2001 net
sales were made through such distributors.


     In order to provide a high level of expertise to the medical specialties we
serve, our domestic sales force consists of the following:

     - 180 sales representatives selling arthroscopy and orthopedic powered
       surgical instrument products, including 90 employee sales representatives
       and 90 sales professionals employed by eight sales agent groups.

     - 60 employee sales representatives selling electrosurgery products.

     - 30 employee sales representatives selling endoscopy products.

     - 30 employee sales representatives selling patient care products.

     Each employee sales representative has a defined geographic area and is
compensated on a commission basis or through a combination of salary and
commission. The sales force is supervised and supported by area directors. Sales
agent groups are used in the eight largest metropolitan areas of the United
States to sell our orthopedic products in their geographic territories. All of
these sales agent groups, except one, sell CONMED products exclusively. None
stock product for resale to customers as we ship

                                        35


product directly to customers and carry the receivable for that group. The sales
agent groups are all paid a commission for sales made to customers in their
exclusive geographic areas. Home office sales and marketing management provide
the overall direction for the sales of our products.

     We also have a corporate sales department that is responsible for
interacting with GPOs and IHNs. We have contracts with many such organizations
and believe that the lack of any individual group purchasing contract will not
adversely impact our competitiveness in the marketplace. Our sales professionals
are required to work closely with distributors where applicable and to maintain
close relationships with end-users.


     The sale of our products is accompanied by initial and ongoing in-service
training of the end-user. Our sales professionals are trained in the technical
aspects of our products and their uses and the procedures in which they are
used. Our sales professionals, in turn, provide surgeons and medical personnel
with information relating to the technical features and benefits of our
products.


     Our international sales accounted for approximately 29% of total revenues
in 2001. Products are sold in over 100 foreign countries. International sales
efforts are coordinated through local country dealers or with direct sales
efforts. We distribute our products through sales subsidiaries and branches with
offices located in Australia, Belgium, Canada, France, Germany, Korea, Spain and
the United Kingdom. In these countries, our sales are denominated in the local
currency. In the remaining countries where our products are sold through
independent distributors, sales are denominated in United States dollars.

     We sell to a diversified base of customers around the world and, therefore,
believe there is no material concentration of credit risk.

MANUFACTURING

     We manufacture most of our products and assemble them primarily from
components we produce. We believe our vertically integrated manufacturing
process allows us to provide quality products and generate manufacturing
efficiencies by purchasing raw materials for our disposable products in bulk. We
also believe that our manufacturing capabilities allow us to contain costs,
control quality and maintain security of proprietary processes. We use various
manual and automated equipment for fabrication and assembly of our products and
are continuing to further automate our facilities.

     We use a variety of raw materials in our manufacturing processes. We work
to maintain multiple suppliers for each of our raw materials and components.
None of our critical raw materials are sourced from a single supplier.

     All of our products are classified as medical devices subject to regulation
by the Food and Drug Administration. As a manufacturer of medical devices, our
manufacturing processes and facilities are subject to on-site inspection and
continuing review by the FDA for compliance with its Quality System Regulations.
Manufacturing and sales of our products outside the United States are also
subject to foreign regulatory requirements that vary from country to country.
The time required to obtain approvals from foreign countries may be longer or
shorter than that required for FDA approval, and requirements for foreign
approvals may differ from FDA requirements.

                                        36


     The following table provides information regarding our primary
manufacturing and administrative facilities. We believe our facilities are
adequate in terms of space and suitability for our needs over the next several
years.



LOCATION                                     SQUARE FEET    OWN OR LEASE    LEASE EXPIRATION
--------                                     -----------    ------------    ----------------
                                                                   
Utica, NY (two facilities).................    650,000        Own                 --
Largo, FL..................................    278,000        Own                 --
Rome, NY...................................    120,000        Own                 --
Englewood, CO..............................     65,000        Own                 --
Irvine, CA ................................     31,000       Lease           August 2003
El Paso, TX................................     29,000       Lease            April 2005
Juarez, Mexico.............................     25,000       Lease          December 2004
Santa Barbara, CA..........................     18,000       Lease          December 2003


     We believe our production and inventory practices are generally reflective
of conditions in the industry. Our products are not generally made to order or
to individual customer specifications. Accordingly, we schedule production and
stock inventory on the basis of experience and our knowledge of customer order
patterns, and our judgment as to anticipated demand. Since customer orders must
generally be filled promptly for immediate shipment, backlog of unfilled orders
is not significant to an understanding of our business.

RESEARCH AND DEVELOPMENT ACTIVITIES


     During the years ended December 31, 1999, 2000 and 2001, we spent
approximately $12.1 million, $14.9 million and $14.8 million for research and
development. Our research and development department has 116 employees.


     Our research and development programs focus on the development of new
products, as well as the enhancement of existing products with the latest
technology and updated designs. We are continually seeking to develop new
technologies to improve durability, performance and usability of existing
products. In addition to our own research and development, we receive new
product and technology disclosures, especially in procedure-specific areas, from
surgeons, inventors and operating room personnel. For disclosures that we deem
promising from a clinical and commercial perspective, we seek to obtain rights
to these ideas by negotiating agreements, which typically compensate the
originator of the idea through royalty payments based on a percentage of net
sales of licensed products.

     We have rights to numerous U.S. patents and corresponding foreign patents,
covering a wide range of our products. We own a majority of these patents and
have licensed rights to the remainder, both on an exclusive and non-exclusive
basis. In addition, certain patents are currently licensed to third parties on a
non-exclusive basis. Due to technological advancements, we do not rely on our
patents to maintain our competitive position, and we believe that development of
new products and improvement of existing ones is and will continue to be more
important than patent protection in maintaining our competitive position.

COMPETITION


     The market for our products is highly competitive and our customers have
numerous alternatives of supply. Many of our competitors offer a range of
products in areas other than those in which we compete, which may make such
competitors more attractive to surgeons, hospitals, GPOs and others. In
addition, many of our competitors are larger and have greater financial
resources than we do and offer a range of products broader than our products.
Because our customers are not bound by long-term supply arrangements with us, we
may not be able to shift our production to other products following a loss of
customers to our competitors.


                                        37


     The following chart identifies our principal competitors in each of our key
business areas:




        BUSINESS AREA                                  COMPETITOR
-----------------------------    ------------------------------------------------------
                              
Arthroscopy                      Smith & Nephew plc
                                 Arthrex
                                 Stryker Corporation
                                 Arthrocare
                                 Johnson & Johnson's Mitek division

Powered Surgical Instruments     Stryker Corporation
                                 Medtronic, Inc.'s Midas Rex and Xomed divisions
                                 Anspach

Electrosurgery                   Tyco International Ltd.'s Valleylab division
                                 3M Company
                                 Johnson & Johnson

Patient Care                     Tyco International Ltd.'s Kendall division
                                 3M Company

Endoscopy                        Tyco International Ltd.'s U.S. Surgical division
                                 Johnson & Johnson's Ethicon division



     We believe that product design, development and improvement, customer
acceptance, marketing strategy, customer service and price are critical elements
to compete in our industry. Other alternatives, such as medical procedures or
pharmaceuticals, could at some point prove to be interchangeable alternatives to
our products.

GOVERNMENT REGULATION

     Most if not all of our products are classified as medical devices subject
to regulation by the Food and Drug Administration. Our new products generally
require FDA clearance under a procedure known as 510(k) premarketing
notification. A 510(k) premarketing notification clearance indicates FDA
agreement with an applicant's determination that the product for which clearance
has been sought is substantially equivalent to another medical device that was
on the market prior to 1976 or that has received 510(k) premarketing
notification clearance. Some products have been continuously produced, marketed
and sold since May 1976 and require no 510(k) premarketing clearance. Our
products generally are either Class I or Class II products with the FDA, meaning
that our products must meet certain FDA standards and are subject to the 510(k)
premarketing notification clearance discussed above, but are not required to be
approved by the FDA. FDA clearance is subject to continual review, and later
discovery of previously unknown problems may result in restrictions on a
product's marketing or withdrawal of the product from the market.

     We have quality control/regulatory compliance groups that are tasked with
monitoring compliance with design specifications and relevant government
regulations for all of our products. We and substantially all of our products
are subject to the provisions of the Federal Food, Drug and Cosmetic Act of
1938, as amended by the Medical Device Amendments of 1976, and the Safe Medical
Device Act of 1990, as amended in 1992, and similar foreign regulations.

     As a manufacturer of medical devices, our manufacturing processes and
facilities are subject to periodic on-site inspections and continuing review by
the FDA to insure compliance with Quality System Regulations as specified in
Title 21, Code of Federal Regulation (CFR) part 820. Many of our products are
subject to industry-set standards. Industry standards relating to our products
are generally formulated by committees of the Association for the Advancement of
Medical Instrumentation. We believe that our products presently meet applicable
standards. We market our products in a number of foreign markets. Requirements
pertaining to our products vary widely from country to country, ranging from
simple product

                                        38


registrations to detailed submissions such as those required by the FDA. We
believe that our products currently meet applicable standards for the countries
in which they are marketed.

     We are subject to product recall and have made product recalls in the past.
No recall has had a material effect on our financial condition, but there can be
no assurance regulatory issues may not have a material adverse effect in the
future.

     Any change in existing federal, state or foreign laws or regulations, or in
the interpretation or enforcement thereof, or the promulgation or any additional
laws or regulations could have an adverse effect on our financial condition or
results of operations.

EMPLOYEES

     As of December 2001, we had 2,560 full-time employees, of whom 1,754 were
in manufacturing, 116 in research and development, and the balance were in
sales, marketing, executive and administrative positions. None of our employees
are represented by a union, and we consider our employee relations to be
excellent. We have never experienced any strikes or work stoppages.

                                        39


                                   MANAGEMENT

DIRECTORS AND EXECUTIVE OFFICERS

     Our executive officers and the members of our board of directors are as
follows:




NAME                                    AGE    POSITION
----                                    ---    --------
                                         
Eugene R. Corasanti...................  71     Chairman of the Board and Chief
                                                 Executive Officer
Joseph J. Corasanti...................  38     President and Chief Operating Officer;
                                                 Director
William W. Abraham....................  70     Senior Vice President
Robert D. Shallish, Jr. ..............  53     Chief Financial Officer
Gerald G. Woodard.....................  54     President -- Linvatec
Daniel S. Jonas.......................  38     Vice President -- Legal Affairs and
                                                 General Counsel
Luke A. Pomilio.......................  37     Vice President; Controller
Thomas M. Acey........................  55     Secretary and Treasurer
Frank R. Williams.....................  53     Vice President -- Sales and Marketing
                                               for Endoscopy
John J. Stotts........................  45     Vice President -- Marketing and Sales
                                               for Patient Care Products
Eugene T. Starr.......................  56     President -- CONMED Electrosurgery
Robert E. Remmell.....................  71     Director
Bruce F. Daniels......................  67     Director
William D. Matthews...................  67     Director
Stuart J. Schwartz....................  65     Director




     EUGENE R. CORASANTI has served as our Chairman of the Board since our
incorporation in 1970. Mr. Corasanti is also our Chief Executive Officer. Prior
to that time he was an independent public accountant. Mr. Corasanti holds a
B.B.A. degree in Accounting from Niagara University.



     JOSEPH J. CORASANTI has served as our President and Chief Operating Officer
since August 1999 and as a Director since May 1994. He also served as our
General Counsel and Vice President-Legal Affairs from March 1993 to August 1998
and our Executive Vice-President/General Manager from August 1998 to August
1999. Prior to that time he was an Associate Attorney with the law firm of
Morgan, Wenzel & McNicholas, Los Angeles, California from 1990 to March 1993.
Mr. Corasanti holds a B.A. degree in Political Science from Hobart College and a
J.D. degree from Whittier College School of Law. Joseph J. Corasanti is the son
of Eugene R. Corasanti, Chairman and Chief Executive Officer of the Company.



     WILLIAM W. ABRAHAM joined us in May 1977 as General Manager. He has served
as our Vice President -- Manufacturing and Engineering since June 1983. In
November of 1989 he was named Executive Vice President and in March 1993, he was
named Senior Vice President. Mr. Abraham holds a B.S. degree in Industrial
Management from Utica College.



     ROBERT D. SHALLISH, JR. joined us as Chief Financial Officer and Vice
President-Finance in December 1989 and has also served as an Assistant Secretary
since March 1995. Prior to this he was employed as Controller of Genigraphics
Corporation in Syracuse, New York since 1984. He was employed by Price
Waterhouse LLP as a certified public accountant and senior manager from 1972
through 1984. Mr. Shallish graduated with a B.A. degree in Economics from
Hamilton College and holds a Master's degree in Accounting from Syracuse
University.



     GERALD G. WOODARD joined us as President of Linvatec Corporation, our
wholly-owned subsidiary, in May 2000. Prior to his employment with us, Mr.
Woodard served as the President of Elekta


                                        40


Holdings, Inc. from March 1998 to May 2000. Previous to this position Mr.
Woodard was the President of the Monitoring and Information Systems Division of
Marquette Medical Systems from November 1995 to March 1998. Mr. Woodard holds a
B.G.S. degree from Indiana University.


     DANIEL S. JONAS joined us as General Counsel in August 1998 and in addition
became our Vice President -- Legal Affairs in March 1999. In September 1999, Mr.
Jonas assumed responsibility for certain of our Regulatory Affairs and Quality
Assurance. Prior to his employment with us he was a partner with the law firm of
Harter, Secrest & Emery, LLP in Syracuse from January 1998 to August 1998,
having joined the firm as an Associate Attorney in 1995. Prior to that he was an
Associate Attorney at Miller, Alfano & Raspanti, P.C. in Philadelphia from 1992
to 1995 as well as an adjunct professor of law at the University of Pennsylvania
Law School from 1991 to 1995. Mr. Jonas holds an A.B. degree from Brown
University and a J.D. from the University of Pennsylvania Law School.



     LUKE A. POMILIO joined us as Controller in September 1995. In addition, in
September 1999, Mr. Pomilio became a Vice President with responsibility for
certain of our manufacturing and research and development activities. Prior to
his employment with us, Mr. Pomilio served for two years as Controller of Rome
Cable Corporation, a wire and cable manufacturer. He was also employed as a
certified public accountant for seven years with Price Waterhouse LLP where he
served most recently as an audit manager. Mr. Pomilio graduated with a B.S.
degree in Accounting and Law from Clarkson University.



     THOMAS M. ACEY has been employed by us since August 1980 and has served as
our Treasurer since August 1988 and as our Secretary since January 1993. Mr.
Acey holds a B.S. degree in Public Accounting from Utica College and prior to
joining us was employed by the certified public accounting firm of Tartaglia &
Benzo in Utica, New York.



     FRANK R. WILLIAMS joined us in 1974 as Sales Manager and Director of
Marketing and became Vice President -- Marketing and Sales in June 1983. In
September 1989, he became Vice President -- Business Development, in November
1995, he became Vice President -- Technology Assessment and in January 2000, he
also became Vice President -- Research and Development and Marketing for
Minimally Invasive Surgical Products, which is now known as CONMED Endoscopy.
Mr. Williams graduated with a B.A. degree from Hartwick College in 1970 as a
biology major and did his graduate study in Human Anatomy at the University of
Rochester College of Medicine.



     JOHN J. STOTTS joined us as Vice President -- Marketing and Sales for
Patient Care in July 1993 and became Vice President -- Marketing in December
1996. In January 2000, Mr. Stotts became Vice President -- Marketing and Sales
for Patient Care Products. Prior to his employment with us, Mr. Stotts served as
Director of Marketing and Sales for Medtronic Andover Medical, Inc. Mr. Stotts
holds a B.A. degree in Business Administration from Ohio University.



     EUGENE T. STARR joined us as President of CONMED Electrosurgery in July
2001. Prior to his employment with us, Mr. Starr served as President of TYCO
Healthcare Group, Canada from October 1999 (when TYCO acquired U.S. Surgical
Corporation) to January 2001. Before his position with TYCO, Mr. Starr spent 17
years with U.S. Surgical, the most recent being Vice President and General
Manager of Auto Suture Co., U.S. Surgical's Canadian subsidiary. Mr. Starr holds
a B.S. degree in Business Administration from the University of Charleston.



     ROBERT E. REMMELL has served as a Director since June 1983. Mr. Remmell
also served as our Assistant Secretary and as a non-employee officer of several
of our subsidiaries from June 1983 until March 1, 2000, when he resigned from
his position as Assistant Secretary, and from the positions he had held in our
subsidiaries. Mr. Remmell has been a partner since January 1961 of Steates
Remmell Steates & Dziekan, Utica, New York, which has served as counsel to the
Company. Mr. Remmell holds a B.A. degree from Utica College and an L.L.B. from
Syracuse University School of Law.



     BRUCE F. DANIELS has served as a Director since August 1992. From August
1974 to June 1997, Mr. Daniels held various executive positions, including a
position as Controller with Chicago Pneumatic Tool Company and he is currently
retired. Mr. Daniels holds a B.S. degree in Business from Utica College.

                                        41



     WILLIAM D. MATTHEWS has served as a Director since August 1997. From 1986
until retiring from the positions in 1999, Mr. Matthews was the Chairman of the
Board and the Chief Executive Officer of Oneida Ltd. Mr. Matthews is a director
of Oneida Financial Corporation and formerly served as a director of Coyne
Textile Services. Mr. Matthews holds a B.A. degree from Union College and an
L.L.B. degree from Cornell University School of Law.



     STUART J. SCHWARTZ has served as a Director since May 1998. Dr. Schwartz is
a retired physician. From 1969 to December 1997 he was engaged in private
practice as an urologist. Dr. Schwartz holds a B.A. degree from Cornell
University and a M.D. degree from SUNY Upstate Medical College, Syracuse.



     As of March 29, 2002, our executive officers and directors beneficially
owned 2,165,794 shares of our common stock, representing 8.48% of the
outstanding shares of common stock, and are record owners of 521,525 shares of
our common stock, representing 2.04% of the outstanding shares of our common
stock. Giving effect to the offering, and assuming no exercise of the
underwriters' over-allotment option, these ownership percentages would decline
to 7.59% and 1.83%.


                                        42


                          DESCRIPTION OF CAPITAL STOCK

     Our authorized capital stock currently consists of 100,000,000 shares of
common stock, par value $0.01 per share, and 500,000 shares of preferred stock,
par value $0.01 per share.

COMMON STOCK


     As of March 29, 2002, there were 25,549,358 shares of our common stock
issued and outstanding held of record by 1,213 shareholders. As of March 29,
2002, an additional 424,860 shares of common stock were reserved for issuance
under our stock option plans. At our annual meeting of shareholders, scheduled
to be held on May 14, 2002, our board of directors has recommended that our
shareholders approve an amendment to our 1999 Long Term Incentive Plan to
increase the number of shares of common stock authorized for issuance by
1,000,000 shares and an amendment to our Stock Option Plan for Non-Employee
Directors to increase the number of shares of common stock authorized for
issuance by 100,000 shares.


     Subject to the preferences, limitations and relative rights of holders of
our preferred stock described below, the holders of our common stock are
entitled, among other things,

     - to share ratably in dividends if, when, and as declared by our board of
       directors out of funds legally available therefore,

     - to one vote for each share held of record on all matters at all meetings
       of shareholders, and

     - in the event of our liquidation, dissolution or winding-up, to share
       ratably in the distribution of assets remaining after payment of debts
       and expenses.

     Holders of shares of our common stock have no cumulative voting rights or
preemptive rights to subscribe for or purchase any additional shares of capital
stock issued by us. Our transfer agent and registrar is Registrar and Transfer
Company.

     Under New York law, a corporation may declare and pay dividends or make
other distributions in cash or its bonds or its property on its outstanding
shares, except when the corporation is insolvent or would thereby be made
insolvent, or when the declaration, payment or distribution would be contrary to
any restriction contained in the certificate of incorporation. Our certificate
of incorporation contains no such restriction. In general, dividends may be
declared or paid and other distributions may be made out of surplus only, so
that the net assets of the corporation remaining after such declaration, payment
or distribution shall at least equal the amount of its stated capital.

     Our board of directors presently intends to retain future earnings to
finance the development of our business and does not presently intend to declare
cash dividends. Should this policy change, the declaration of cash dividends
will be determined by our board of directors in the light of conditions then
existing, including our financial requirements and condition and provisions
affecting the declaration and payment of dividends contained in debt agreements.
Our credit agreement prohibits the payment of cash dividends and further
subjects us to compliance with various financial covenants.

PREFERRED STOCK

     We are currently authorized to issue up to 500,000 shares of our preferred
stock, none of which is issued and outstanding. Our preferred stock may be
issued in one or more series by our board of directors without further action by
shareholders. Our board of directors is authorized to fix as to any such series
the dividend rate or rates, redemption prices, preferences on liquidation,
dissolution and winding-up, sinking fund terms, if any, conversion or exchange
rights, if any, voting rights and any other preferences or special rights and
qualifications.

     Depending upon the rights of any preferred stock, its issuance could have
an adverse effect on holders of our common stock by delaying or preventing a
change in control, making removal of our present

                                        43


management more difficult or resulting in restrictions upon the payment of
dividends and other distributions to the holders of our common stock.

PURCHASE AND CANCELLATION OF WARRANT ISSUED TO BRISTOL-MYERS SQUIBB


     In 1997, in connection with the acquisition of Linvatec, we issued to
Bristol-Myers Squibb Company a warrant that is exercisable in whole or in part
for up to 1,500,000 shares of our common stock at a price of $22.82 per share.
On April 30, 2002, we agreed to purchase the warrant for $2 million in cash and
upon its purchase, we intend to cancel it.


                        SHARES ELIGIBLE FOR FUTURE SALE

     As of March 29, 2002, we had outstanding 25,549,358 shares of common stock.
Of those outstanding shares of common stock, 521,525 are beneficially owned by
certain persons who may be deemed "affiliates" of ours for purposes of Rule 144
under the Securities Act of 1933, as amended, are not freely tradeable without
restriction or further registration under the Securities Act. All of these
shares are eligible for sale in the open market in accordance with Rule 144
under the Securities Act.

     In general, under Rule 144 as currently in effect, any person who has
beneficially owned shares for at least one year, including persons who may be
deemed an "affiliate" of ours, is entitled to sell within any three-month period
a number of shares of our common stock that does not exceed the greater of (i)
1% of the then outstanding shares of our common stock or (ii) the average weekly
trading volume in our common stock during the four calendar weeks preceding such
sale. Such sales under Rule 144 are also subject to certain manner of sale
provisions, notice requirements and to the availability of our current public
information. In addition, any person who is not deemed our "affiliate," and who
has beneficially owned his or her shares for at least two years, is entitled to
sell such shares under Rule 144 without regard to the volume limitations, manner
of sale provisions or notice requirements.

     While no predictions can be made of any effect, that open market sales of
shares or the availability of shares for sale will have on the market price
prevailing from time to time, sales of substantial amounts of our common stock
in the public market, or the perception that such sales will occur, could
adversely affect market prices and trading activities in our common stock.

                                        44


                                  UNDERWRITING

     Salomon Smith Barney Inc. is acting as sole bookrunning manager and joint
lead manager of the offering, UBS Warburg LLC is acting as joint lead manager
and Salomon Smith Barney Inc. and UBS Warburg LLC, together with Needham &
Company, Inc. and First Albany Corporation are acting as representatives of the
underwriters named below. Subject to the terms and conditions stated in the
underwriting agreement dated the date of this prospectus, each underwriter named
below has agreed to purchase, and we have agreed to sell to that underwriter,
the number of shares set forth opposite the underwriter's name.



                                                                 NUMBER
UNDERWRITER                                                     OF SHARES
-----------                                                     ---------
                                                             
Salomon Smith Barney Inc. ..................................
UBS Warburg LLC.............................................
Needham & Company, Inc. ....................................
First Albany Corporation....................................
                                                                ---------
  Total.....................................................    3,000,000
                                                                =========


     The underwriting agreement provides that the obligations of the
underwriters to purchase the shares included in this offering are subject to
approval of legal matters by counsel and to other conditions. The underwriters
are obligated to purchase all the shares (other than those covered by the
over-allotment option described below) if they purchase any of the shares.

     The underwriters propose to offer some of the shares directly to the public
at the public offering price set forth on the cover page of this prospectus and
some of the shares to dealers at the public offering price less a concession not
to exceed $     per share. The underwriters may allow, and dealers may reallow,
a concession not to exceed $     per share on sales to other dealers. If all of
the shares are not sold at the initial offering price, the representatives may
change the public offering price and the other selling terms.

     We have granted to the underwriters an option, exercisable for 30 days from
the date of this prospectus, to purchase up to 450,000 additional shares of
common stock at the public offering price less the underwriting discount. The
underwriters may exercise the option solely for the purpose of covering
over-allotments, if any, in connection with this offering. To the extent the
option is exercised, each underwriter must purchase a number of additional
shares approximately proportionate to that underwriter's initial purchase
commitment.

     We and certain of our officers and directors have agreed that, for a period
of 90 days from the date of this prospectus, subject to certain exceptions, we
and they will not, without the prior written consent of Salomon Smith Barney,
dispose of or hedge any shares of our common stock or any securities convertible
into or exchangeable for our common stock. Salomon Smith Barney in its sole
discretion may release any of the securities subject to these lock-up agreements
at any time without notice.


     The common stock is quoted on the Nasdaq National Market under the symbol
"CNMD."


     The following table shows the underwriting discounts and commissions that
we are to pay to the underwriters in connection with this offering. These
amounts are shown assuming both no exercise and full exercise of the
underwriters' option to purchase additional shares of common stock.



                                                                     PAID BY CONMED
                                                              ----------------------------
                                                              NO EXERCISE    FULL EXERCISE
                                                              -----------    -------------
                                                                       
Per share...................................................       $               $
Total.......................................................       $               $


     In connection with the offering, Salomon Smith Barney, on behalf of the
underwriters, may purchase and sell shares of common stock in the open market.
These transactions may include short sales, syndicate covering transactions and
stabilizing transactions. Short sales involve syndicate sales of common stock in

                                        45


excess of the number of shares to be purchased by the underwriters in the
offering, which creates a syndicate short position. "Covered" short sales are
sales of shares made in an amount up to the number of shares represented by the
underwriters' over-allotment option. In determining the source of shares to
close out the covered syndicate short position, the underwriters will consider,
among other things, the price of shares available for purchase in the open
market as compared to the price at which they may purchase shares through the
over-allotment option. Transactions to close out the covered syndicate short
involve either purchases of the common stock in the open market after the
distribution has been completed or the exercise of the over-allotment option.
The underwriters may also make "naked" short sales of shares in excess of the
over-allotment option. The underwriters must close out any naked short position
by purchasing shares of common stock in the open market. A naked short position
is more likely to be created if the underwriters are concerned that there may be
downward pressure on the price of the shares in the open market after pricing
that could adversely affect investors who purchase in the offering. Stabilizing
transactions consist of bids for or purchases of shares in the open market while
the offering is in progress.

     The underwriters also may impose a penalty bid. Penalty bids permit the
underwriters to reclaim a selling concession from a syndicate member when
Salomon Smith Barney repurchases shares originally sold by that syndicate member
in order to cover syndicate short positions or make stabilizing purchases.

     Any of these activities may have the effect of preventing or retarding a
decline in the market price of the common stock. They may also cause the price
of the common stock to be higher than the price that would otherwise exist in
the open market in the absence of these transactions. The underwriters may
conduct these transactions on the Nasdaq National Market or in the
over-the-counter market, or otherwise. If the underwriters commence any of these
transactions, they may discontinue them at any time.

     In addition, in connection with this offering, some of the underwriters
(and selling group members) may engage in passive market making transactions in
the common stock on the Nasdaq National Market, prior to the pricing and
completion of this offering. Passive market making consists of displaying bids
on the Nasdaq National Market no higher than the bid prices of independent
market makers and making purchases at prices no higher than those independent
bids and effected in response to order flow. Net purchases by a passive market
maker on each day are limited to a specified percentage of the passive market
maker's average daily trading volume in the common stock during a specified
period and must be discontinued when the limit is reached. Passive market making
may cause the price of the common stock to be higher than the price that
otherwise would exist in the open market in the absence of those transactions.
If the underwriters commence passive market making transactions, they may
discontinue them at any time.


     We estimate that our portion of the total expenses of this offering will be
$400,000.



     The underwriters have performed investment banking and advisory services
for us from time to time for which they have received customary fees and
expenses. An affiliate of Salomon Smith Barney is a lender and documentation
agent under our credit facility. The underwriters may, from time to time, engage
in transactions with and perform services for us in the ordinary course of their
business.


     A prospectus in electronic format may be made available on the websites
maintained by one or more of the underwriters. The representatives may agree to
allocate a number of shares to underwriters for sale to their online brokerage
account holders. The representatives will allocate shares to underwriters that
may make Internet distributions on the same basis as other allocations. In
addition, shares may be sold by the underwriters to securities dealers who
resell shares to online brokerage account holders.

     We have agreed to indemnify the underwriters against certain liabilities,
including liabilities under the Securities Act of 1933, or to contribute to
payments the underwriters may be required to make because of any of those
liabilities.

                                        46


                            VALIDITY OF COMMON STOCK

     The validity of the common stock offered hereby will be passed on for us by
Sullivan & Cromwell, New York, New York, special counsel to the Company, and for
the Underwriters by Cleary, Gottlieb, Steen & Hamilton, New York, New York.

                                    EXPERTS

     The consolidated financial statements of CONMED Corporation as of December
31, 2000 and 2001 and for each of the three years in the period ended December
31, 2001, incorporated herein by reference from our Form 10-K, have been so
included on the reliance on the reports of PricewaterhouseCoopers LLP,
independent accountants, given on the authority of said firm as experts in
accounting and auditing.

                      WHERE YOU CAN FIND MORE INFORMATION

THE REGISTRATION STATEMENT

     We have filed a registration statement with the SEC that registers the
shares offered by this prospectus.

     The registration statement that we filed with the SEC, including the
attached exhibits and schedules, contains additional relevant information about
CONMED and its shares of common stock. The SEC allows us to omit some
information included in the registration statement from this prospectus. You
should read the entire registration statement in order to obtain this additional
information.

FILINGS WITH THE SEC

     In addition, we file reports, proxy statements and other information with
the SEC on a regular basis. You may read and copy this information at the
following locations of the SEC:

                             PUBLIC REFERENCE ROOM

                             450 FIFTH STREET, N.W.

                                   ROOM 1024
                             WASHINGTON, D.C. 20549

     You may also obtain copies of this information by mail from the Public
Reference Section of the SEC, 450 Fifth Street, N.W., Room 1024, Washington,
D.C. 20549, at prescribed rates. Further information on the operation of the
SEC's Public Reference Room in Washington, D.C. can be obtained by calling the
SEC at l-800-SEC-0330.

     The SEC also maintains an Internet world wide web site that contains
reports, proxy statements and other information about issuers, like CONMED, who
file electronically with the SEC. The address of that site is
http://www.sec.gov.

DOCUMENTS INCORPORATED BY REFERENCE

     THE SEC ALLOWS US TO "INCORPORATE BY REFERENCE" INFORMATION INTO THIS
PROSPECTUS. THIS MEANS THAT WE CAN DISCLOSE IMPORTANT INFORMATION TO YOU BY
REFERRING YOU TO ANOTHER DOCUMENT FILED SEPARATELY WITH THE SEC. This
information incorporated by reference is a part of this prospectus, unless we
provide you with different information in this prospectus.

     This prospectus incorporates by reference the documents listed below that
we have previously filed with the SEC. They contain important information about
CONMED and its financial condition.

     - CONMED's Annual Report on Form 10-K for the year ended December 31, 2001
       (our "Form 10-K").

                                        47


     - The description of our common stock contained in our Registration
       Statement on Form 8-A, dated August 5, 1987, filed with the SEC under
       Section 12(b) of the Exchange Act, including any amendment or reports
       filed under the Exchange Act for the purpose of updating such
       description.

     This prospectus also incorporates by reference additional documents that we
may file with the SEC under Sections 13(a), 13(c), 14 and 15(d) of the Exchange
Act after the time of filing of the initial registration statement and before
effectiveness of the registration statement, and after the date of this
prospectus and before the termination of this offering. These documents include
annual reports, quarterly reports and other current reports, as well as proxy
statements.

     You can obtain any of the documents incorporated by reference in this
document from us or from the SEC through the SEC's web site at the address
described above. Documents incorporated by reference are available from us
without charge, excluding any exhibits to those documents unless we specifically
incorporated by reference the exhibit in this prospectus. You can obtain these
documents from us by requesting them in writing or by telephone at the following
address or number:

                                   SECRETARY
                               CONMED CORPORATION
                                525 FRENCH ROAD
                           UTICA, NEW YORK 13502-5994
                           TELEPHONE: (315) 624-3207

                                        48


                         INDEX TO FINANCIAL STATEMENTS





                                                             
Report of Independent Accountants...........................    F-2
Consolidated Balance Sheets at December 31, 2000 and 2001...    F-3
Consolidated Statements of Income for the Years Ended
  December 1999, 2000 and 2001..............................    F-4
Consolidated Statements of Shareholders' Equity for the
  Years Ended December 1999, 2000 and 2001..................    F-5
Consolidated Statements of Cash Flows for the Years Ended
  December 1999, 2000 and 2001..............................    F-6
Notes to Consolidated Financial Statements..................    F-7



                                       F-1


                       REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors and
Shareholders of CONMED Corporation

     In our opinion, the accompanying consolidated balance sheets and the
related consolidated statements of income, of cash flows and of shareholders'
equity present fairly, in all material respects, the financial position of
CONMED Corporation and its subsidiaries at December 31, 2001 and 2000, and the
results of their operations and their cash flows for each of the three years in
the period ended December 31, 2001, in conformity with accounting principles
generally accepted in the United States of America. These financial statements
are the responsibility of the Company's management; our responsibility is to
express an opinion on these financial statements based on our audits. We
conducted our audits of these statements in accordance with auditing standards
generally accepted in the United States of America, which require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

PRICEWATERHOUSECOOPERS LLP

Syracuse, New York
February 5, 2002

                                       F-2



                               CONMED CORPORATION


                          CONSOLIDATED BALANCE SHEETS

                         AT DECEMBER 31, 2000 AND 2001


                      (IN THOUSANDS EXCEPT SHARE AMOUNTS)




                                                                2000        2001
                                                              --------    --------
                                                                    
ASSETS
Current assets:
  Cash and cash equivalents.................................  $  3,470    $  1,402
  Accounts receivable, less allowance for doubtful accounts
     of $1,479 in 2000 and $1,553 in 2001...................    78,626      51,188
  Inventories...............................................   104,612     107,390
  Deferred income taxes.....................................     1,761       1,105
  Prepaid expenses and other current assets.................     3,562       3,464
                                                              --------    --------
     Total current assets...................................   192,031     164,549
                                                              --------    --------
Property, plant and equipment, net..........................    62,450      91,026
Goodwill, net...............................................   225,801     251,140
Other intangible assets, net................................   195,008     189,752
Other assets................................................     4,281       5,141
                                                              --------    --------
     Total assets...........................................  $679,571    $701,608
                                                              ========    ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
  Current portion of long-term debt.........................  $ 36,068    $ 73,429
  Accounts payable..........................................    20,350      19,877
  Accrued compensation......................................     9,913      11,863
  Income taxes payable......................................     1,979       2,507
  Accrued interest..........................................     5,130       4,954
  Other current liabilities.................................     4,836       7,207
                                                              --------    --------
     Total current liabilities..............................    78,276     119,837
                                                              --------    --------
Long-term debt..............................................   342,680     262,500
Deferred income taxes.......................................    12,154      18,655
Other long-term liabilities.................................    15,858      16,982
                                                              --------    --------
     Total liabilities......................................   448,968     417,974
                                                              --------    --------
Shareholders' equity:
  Preferred stock, par value $.01 per share; authorized
     500,000 shares, none outstanding.......................        --          --
  Common stock, par value $.01 per share; 100,000,000
     authorized; 23,028,279 and 25,261,590, issued and
     outstanding in 2000 and 2001, respectively.............       230         253
  Paid-in capital...........................................   127,985     160,757
  Retained earnings.........................................   103,834     128,240
  Accumulated other comprehensive loss......................    (1,027)     (5,197)
  Less 37,500 shares of common stock in treasury, at cost...      (419)       (419)
                                                              --------    --------
     Total shareholders' equity.............................   230,603     283,634
                                                              --------    --------
     Total liabilities and shareholders' equity.............  $679,571    $701,608
                                                              ========    ========


                See notes to consolidated financial statements.
                                       F-3



                               CONMED CORPORATION


                       CONSOLIDATED STATEMENTS OF INCOME
                    YEARS ENDED DECEMBER 1999, 2000 AND 2001

                    (IN THOUSANDS EXCEPT PER SHARE AMOUNTS)





                                                               1999        2000        2001
                                                             --------    --------    --------
                                                                            
Net sales..................................................  $376,226    $395,873    $428,722
                                                             --------    --------    --------
Cost of sales..............................................   178,480     188,223     204,374
Selling and administrative expense.........................   110,842     128,316     140,560
Research and development expense...........................    12,108      14,870      14,830
                                                             --------    --------    --------
                                                              301,430     331,409     359,764
                                                             --------    --------    --------
Income from operations.....................................    74,796      64,464      68,958
Interest expense, net......................................    32,360      34,286      30,824
                                                             --------    --------    --------
Income before income taxes.................................    42,436      30,178      38,134
Provision for income taxes.................................    15,277      10,864      13,728
                                                             --------    --------    --------
Net income.................................................  $ 27,159    $ 19,314    $ 24,406
                                                             ========    ========    ========
Per share data:
Net income
  Basic....................................................  $   1.19    $   0.84    $   1.02
  Diluted..................................................      1.17        0.83        1.00



                See notes to consolidated financial statements.
                                       F-4



                               CONMED CORPORATION


                CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
                    YEARS ENDED DECEMBER 1999, 2000 AND 2001

                                 (IN THOUSANDS)




                                                                         ACCUMULATED
                                 COMMON STOCK                               OTHER
                                ---------------   PAID-IN    RETAINED   COMPREHENSIVE   TREASURY   SHAREHOLDERS'
                                SHARES   AMOUNT   CAPITAL    EARNINGS   INCOME (LOSS)    STOCK        EQUITY
                                ------   ------   --------   --------   -------------   --------   -------------
                                                                              
Balance at December 1998......  22,775    $228    $124,963   $ 57,361      $    35       $(419)      $182,168
  Exercise of stock options...     182       2       1,610                                              1,612
  Tax benefit arising from
    exercise of stock
    options...................                         744                                                744
  Comprehensive income:
    Foreign currency
       translation
       adjustments............                                                (422)
    Net income................                                 27,159
Total comprehensive income....                                                                         26,737
                                ------    ----    --------   --------      -------       -----       --------
Balance at December 1999......  22,957     230     127,317     84,520         (387)       (419)       211,261
  Exercise of stock options...      72                 449                                                449
  Tax benefit arising from
    exercise of stock
    options...................             219                                                            219
  Comprehensive income:
    Foreign currency
       translation
       adjustments............                                                (640)
    Net income................                                 19,314
  Total comprehensive
    income....................                                                                         18,674
                                ------    ----    --------   --------      -------       -----       --------
Balance at December 2000......  23,029     230     127,985    103,834       (1,027)       (419)       230,603
Exercise of stock options.....     259       3       1,827                                              1,830
Tax benefit arising from
  exercise of stock options...                         604                                                604
Stock issued in connection
  with business
  acquisitions................   1,974      20      30,341                                             30,361
Comprehensive income:
  Foreign currency translation
    adjustments...............                                              (1,142)
  Cash flow hedging (net of
    income tax benefit of
    $1,106)...................                                              (1,966)
  Minimum pension liability
    (net of income tax benefit
    of $597)..................                                              (1,062)
  Net income..................                                 24,406
Total comprehensive income....                                                                         20,236
                                ------    ----    --------   --------      -------       -----       --------
Balance at December 2001......  25,262    $253    $160,757   $128,240      $(5,197)      $(419)      $283,634
                                ======    ====    ========   ========      =======       =====       ========


                See notes to consolidated financial statements.
                                       F-5



                               CONMED CORPORATION


                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                    YEARS ENDED DECEMBER 1999, 2000 AND 2001

                                 (IN THOUSANDS)




                                                                1999        2000        2001
                                                              --------    --------    --------
                                                                             
Cash flows from operating activities:
  Net income................................................  $ 27,159    $ 19,314    $ 24,406
                                                              --------    --------    --------
  Adjustments to reconcile net income to net cash provided
    by operations:
    Depreciation............................................     9,207       9,434       9,055
    Amortization............................................    17,084      20,053      21,093
    Deferred income taxes...................................     8,978       7,974       8,562
  Increase (decrease) in cash flows from changes in assets
    and liabilities, net of effects from acquisitions:
      Proceeds from accounts receivable the sale of.........        --          --      40,000
      Accounts receivable...................................    (9,192)     (2,166)    (12,508)
      Inventories...........................................    (9,086)    (18,035)     (4,235)
      Prepaid expenses and other current assets.............      (799)      1,811          46
      Accounts payable......................................    (3,060)      3,824        (516)
      Income taxes payable..................................     1,242       2,295        (281)
      Income tax benefit of stock option exercises..........       744         219         604
      Accrued compensation..................................        (7)        255       1,950
      Accrued interest......................................    (1,481)        542        (290)
      Other assets/liabilities, net.........................    (3,348)     (9,570)    (10,737)
                                                              --------    --------    --------
                                                                10,282      16,636      52,743
                                                              --------    --------    --------
      Net cash provided by operations.......................    37,441      35,950      77,149
                                                              --------    --------    --------
Cash flows from investing activities:
  Payments related to business acquisitions.................   (40,585)     (6,042)         --
  Purchases of property, plant and equipment................    (9,352)    (14,050)    (14,443)
                                                              --------    --------    --------
    Net cash used by investing activities...................   (49,937)    (20,092)    (14,443)
                                                              --------    --------    --------
Cash flows from financing activities:
  Proceeds of long-term debt................................    40,900          --          --
  Borrowings (repayments) under revolving credit facility...    (8,000)     17,000      11,000
  Proceeds from issuance of common stock....................     1,612         449       1,830
  Payments related to issuance of long-term debt............      (661)         --          --
  Payments on long-term debt................................   (23,103)    (32,921)    (76,423)
                                                              --------    --------    --------
    Net cash provided (used) by financing activities........    10,748     (15,472)    (63,593)
                                                              --------    --------    --------
Effect of exchange rate changes on cash and cash
  equivalents...............................................      (411)       (663)     (1,181)
                                                              --------    --------    --------
Net decrease in cash and cash equivalents...................    (2,159)       (277)     (2,068)
Cash and cash equivalents at beginning of year..............     5,906       3,747       3,470
                                                              --------    --------    --------
Cash and cash equivalents at end of year....................  $  3,747    $  3,470    $  1,402
                                                              ========    ========    ========
Supplemental disclosures of cash flow information:
  Cash paid during the year for:
  Interest..................................................  $ 32,662    $ 33,788    $ 31,135
  Income taxes..............................................     4,502       4,141       2,098


Supplemental disclosures of non-cash investing and financing activities:

  As more fully described in Note 2, we acquired a business in 2001 through the
  exchange of 1,950,000 shares of our common stock valued at $29.9 million.

  As more fully described in Note 2, we acquired certain property in 2001
  through the assumption of approximately $22.7 million of debt and accrued
  interest.

                See notes to consolidated financial statements.
                                       F-6



                               CONMED CORPORATION


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 -- OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES

ORGANIZATION AND OPERATIONS

     The consolidated financial statements include the accounts of CONMED
Corporation and its subsidiaries ("CONMED", the "Company", "we" or "us"). All
intercompany accounts and transactions have been eliminated. CONMED Corporation
is a medical technology company specializing in instruments, implants and video
equipment for arthroscopic sports medicine, and powered surgical instruments
(drills and saws), for orthopaedic, ENT, neuro-surgery and other surgical
specialties. We are also a leading developer, manufacturer and supplier of
advanced medical devices, including RF electrosurgery systems used routinely to
cut and cauterize tissue in nearly all types of surgical procedures worldwide,
endoscopy products such as trocars, clip appliers, scissors and surgical
staplers, and a full line of ECG electrodes for heart monitoring and other
patient care products. Our products are used in a variety of clinical settings,
such as operating rooms, surgery centers, physicians' offices and critical care
areas of hospitals.

USE OF ESTIMATES

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

CASH EQUIVALENTS

     We consider all highly liquid investments with an original maturity of
three months or less to be cash equivalents.

ACCOUNTS RECEIVABLE SALE

     On November 1, 2001, we entered into a five-year accounts receivable sales
agreement pursuant to which we and certain of our subsidiaries sell on an
ongoing basis certain accounts receivable to CONMED Receivables Corporation
("CRC"), a wholly-owned special-purpose subsidiary of CONMED Corporation. CRC
may in turn sell up to an aggregate $50.0 million undivided percentage ownership
interest in such receivables to a commercial paper conduit (the "purchaser").
For receivables which have been sold, CONMED Corporation and its subsidiaries
retain collection and administrative responsibilities as agent for the
purchaser. As of December 2001, the undivided percentage ownership interest in
receivables sold by CRC to a commercial paper conduit aggregated $40.0 million,
which has been accounted for as a sale and reflected in the balance sheet as a
reduction in accounts receivable. We used the initial $40.0 million in proceeds
from the sale of accounts receivable to repay a portion of our loans under our
credit facility. Expenses associated with the sale of accounts receivable,
including the purchaser's financing cost of issuing commercial paper, were $.2
million in 2001.

     There are certain statistical ratios which must be maintained relating to
the pool of receivables in order to continue selling to the purchaser.
Management believes that additional accounts receivable arising in the normal
course of business will be of sufficient quality and quantity to qualify for
sale under the accounts receivable sales agreement. In the event that new
accounts receivable arising in the normal course of business do not qualify for
sale, then collections on sold receivables will flow to the purchaser rather
than being used to fund new receivable purchases. If this were to occur, we
would need to access an alternate source of working capital.

                                       F-7


                               CONMED CORPORATION


           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

INVENTORIES

     Inventories are stated at the lower of cost or market, cost being
determined on the first-in, first-out basis.

PROPERTY, PLANT AND EQUIPMENT

     Property, plant and equipment are stated at cost and depreciated using the
straight-line method over the following estimated useful lives:


                                                           
Building and improvements...................................  40 years
Leasehold improvements......................................  Remaining life of lease
Machinery and equipment.....................................  2 to 15 years


GOODWILL AND OTHER INTANGIBLE ASSETS

     Goodwill represents the excess of purchase price over fair value of
identifiable net assets of acquired businesses. Other intangible assets
primarily represent allocations of purchase price to identifiable intangible
assets of acquired businesses. Goodwill and other intangible assets have been
amortized over periods ranging from 5 to 40 years. Because of our history of
growth through acquisitions, goodwill and other intangible assets comprise a
substantial portion (62.8% at December 2001) of our total assets.

     In June 2001, the Financial Accounting Standards Board approved Statement
of Financial Accounting Standards No. 142 "Goodwill and Other Intangible Assets"
("SFAS 142"). We adopted SFAS 142 effective January 1, 2002. Under this
standard, amortization of goodwill and certain intangibles, including certain
intangibles recorded as a result of past business combinations, is to be
discontinued upon adoption of SFAS 142. In addition, goodwill and certain
intangibles recorded as a result of business combinations completed during the
six-month period ending December 2001 have not been amortized. All goodwill and
intangible assets are being tested for impairment in accordance with the
provisions of SFAS 142. No impairment losses are expected to be recognized as a
result of the tests. While we are still assessing the effect of the adoption of
SFAS 142, management believes that had SFAS 142 been in effect during 2001, net
income would have increased by approximately $5.5 million or $.22 per share.

     Accumulated amortization of goodwill amounted to $23,340,000 and
$29,941,000 at December 2000 and 2001, respectively. Other intangible assets are
comprised of the following (in thousands):



                                                                2000        2001
                                                              --------    --------
                                                                    
Customer relationships......................................  $ 96,712    $ 96,712
Trademarks and tradenames...................................    95,715      95,715
Patents and other intangible assets.........................    31,479      35,465
                                                              --------    --------
                                                               223,906     227,892
Less: Accumulated amortization..............................   (28,898)    (38,140)
                                                              --------    --------
Other intangible assets, net................................  $195,008    $189,752
                                                              ========    ========


DERIVATIVE FINANCIAL INSTRUMENTS

     We do not trade in derivative securities. We do use interest rate swaps to
manage the interest risk associated with our variable rate debt. We accounted
for our interest rate swaps on the accrual method at December 2000, whereby the
net interest receivable or payable is recognized on a periodic basis and
included as a component of interest expense.

                                       F-8


                               CONMED CORPORATION


           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     Effective January 1, 2001, we adopted Statement of Financial Accounting
Standard No. 133, Accounting for Derivative Instruments and Hedging Activities,
("SFAS 133"). SFAS 133 requires that derivatives be recorded on the balance
sheet as assets or liabilities, measured at fair value. Gains or losses
resulting from the changes in the values of the derivatives are accounted for
depending on whether the derivative qualifies for hedge accounting. Upon
adoption of SFAS 133, we recorded a net-of-tax cumulative-effect-type loss
adjustment of $971,000 in accumulated other comprehensive income to recognize at
fair value an interest rate swap which we have designated as a cash-flow hedge
and which effectively converts $50,000,000 of LIBOR-based floating rate debt
under our credit facility into fixed rate debt with a base interest rate of
7.01%. Including the cumulative effect loss adjustment related to the adoption
of SFAS 133, total gross holding losses during 2001 related to the interest rate
swap aggregated $4,415,000 before income taxes, of which $1,343,000, before
income taxes, has been reclassified and included in net income. Management
estimates approximately $2,000,000, before income taxes, of gross holding losses
will be reclassified and included in net income in 2002.

FAIR VALUE OF FINANCIAL INSTRUMENTS

     The fair values of cash and cash equivalents, accounts receivable, accounts
payable, and interest rate swaps approximates their carrying amount. The
estimated fair values and carrying amounts of long-term debt are as follows (in
thousands):



                                               2000                       2001
                                      -----------------------    -----------------------
                                      CARRYING                   CARRYING
                                       AMOUNT      FAIR VALUE     AMOUNT      FAIR VALUE
                                      ---------    ----------    ---------    ----------
                                                                  
Long-term debt (including current
  maturities).......................  $(378,748)   $(352,748)    $(335,929)   $(338,529)


     Fair values were determined from quoted market prices or discounted cash
flow analysis.

TRANSLATION OF FOREIGN CURRENCY FINANCIAL STATEMENTS

     Assets and liabilities of foreign subsidiaries have been translated into
United States dollars at the applicable rates of exchange in effect at the end
of the period reported. Revenues and expenses have been translated at the
applicable weighted average rates of exchange in effect during the period
reported. Translation adjustments are reflected in accumulated other
comprehensive income (loss). Any transaction gains and losses are included in
net income.

REVENUE RECOGNITION

     Revenue is recognized when title to the goods and risk of loss pass to our
customers. Amounts billed to customers related to shipping and handling are
included in net sales. Shipping and handling costs were $9,450,000, $8,125,000
and $8,559,000 for the years ended December 1999, 2000 and 2001, respectively,
and are included in selling and administrative expense. We sell to a diversified
base of customers around the world and, therefore, believe there is no material
concentration of credit risk. We assess the risk of loss on accounts receivable
and adjust the allowance for doubtful accounts based on this risk assessment.
Historically, losses on accounts receivable have not been material. Management
believes the allowance for doubtful accounts of $1,553,000 at December 2001 is
adequate to provide for any potential losses from accounts receivable.

EARNINGS PER SHARE

     Basic earnings per share ("EPS") is computed based on the weighted average
number of common shares outstanding for the period. Diluted EPS gives effect to
all dilutive potential shares outstanding (i.e.,

                                       F-9


                               CONMED CORPORATION


           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

options and warrants) during the period. The following is a reconciliation of
the weighted average shares used in the calculation of basic and diluted EPS (in
thousands):



                                                            1999      2000      2001
                                                           ------    ------    ------
                                                                      
Shares used in the calculation of basic EPS (weighted
  average shares outstanding)............................  22,862    22,967    24,045
Effect of dilutive potential securities..................     283       304       356
                                                           ------    ------    ------
Shares used in the calculation of diluted EPS............  23,145    23,271    24,401
                                                           ======    ======    ======


     The shares used in the calculation of diluted EPS exclude warrants and
options to purchase shares where the exercise price was greater than the average
market price of common shares for the year. Such shares aggregated 1,989,000,
3,396,000 and 2,842,000 at December 1999, 2000 and 2001, respectively.

RECLASSIFICATIONS

     Certain prior year amounts have been reclassified to conform with the
presentation used in 2001.

NOTE 2 -- BUSINESS ACQUISITIONS


     On August 11, 1999, we purchased certain assets of the powered surgical
instrument business of 3M Company (the "Powered Instrument acquisition") for a
purchase price of $40.0 million. The purchase price was funded through
borrowings under our credit facility (Note 5). The Powered Instrument
acquisition was accounted for using the purchase method in which the results of
operations of the acquired business are included in our consolidated results
from the date of acquisition. The acquired products, with annual revenues of
approximately $20.0 million, complement our existing powered surgical instrument
business. Goodwill associated with the Powered Instrument acquisition aggregated
approximately $34.0 million and is being amortized on a straight-line basis over
a 40-year period. In connection with the Powered Instrument acquisition, we
increased the acquired value of inventory by $1.6 million. This inventory was
sold during the quarter ended September 1999 resulting in a nonrecurring
adjustment to increase cost of sales during 1999 by $1.6 million. As a result of
the adoption of SFAS 142, amortization of goodwill associated with the Powered
Instrument acquisition has been discontinued effective January 1, 2002 (Note 1).


     On November 20, 2000 we acquired certain assets of the disposable minimally
invasive surgical business of Imagyn Medical Technologies, Inc. (the "Imagyn
acquisition") for a purchase price of $6.0 million. The Imagyn acquisition was
accounted for using the purchase method in which the results of operations of
the acquired business are included in our consolidated results from the date of
acquisition. The acquisition was funded through borrowings under our revolving
credit facility (Note 5). The acquired products, with annual sales of
approximately $5.0 million, complement our existing minimally invasive surgical
products business. Goodwill associated with the Imagyn acquisition aggregated
approximately $4.8 million and is being amortized on a straight-line basis over
a 40-year period. The Imagyn acquisition did not have a material effect on
earnings per share in the year ended December 2000. As a result of the adoption
of SFAS 142, amortization of goodwill associated with the Imagyn acquisition has
been discontinued effective January 1, 2002 (Note 1).

     On June 11, 2001, we reached a definitive agreement to acquire the
remaining assets of the minimally invasive surgical business of Imagyn Medical
Technologies, Inc. that we did not acquire in November 2000 (the "second Imagyn
acquisition"). The results of operations of the acquired business are included
in our consolidated results from July 6, 2001, the date of acquisition. The new
products, with expected annual revenues of $18.0 to $20.0 million, complement
our existing minimally invasive surgical products business. Under the terms of
the acquisition agreement, we issued Imagyn 1,950,000 shares of

                                       F-10


                               CONMED CORPORATION


           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

CONMED common stock, valuing the transaction at $29.9 million based on the
average market price of our common stock over the 2-day period before and after
the terms of the acquisition were agreed to and announced. Goodwill associated
with the second Imagyn acquisition aggregated approximately $26.7 million. In
accordance with the transition provisions of SFAS 142, this goodwill has not
been amortized. As discussed in Note 11, during the third and fourth quarters of
2001 we incurred certain nonrecurring costs aggregating approximately $1.5
million in connection with the second Imagyn acquisition which are included in
cost of sales. The second Imagyn acquisition did not have a material effect on
earnings per share in the year ended December 2001.

     On August 3, 2001, we purchased the real estate partnerships which own the
Largo, Florida property leased by our Linvatec subsidiary for an aggregate
purchase price of $22.7 million (the "Largo acquisition"). In connection with
the acquisition, we assumed the existing debt on the property and financed the
remainder with the seller (Note 5).

NOTE 3 -- INVENTORIES

     The components of inventory are as follows (in thousands):



                                                                2000        2001
                                                              --------    --------
                                                                    
Raw materials...............................................  $ 38,278    $ 38,101
Work in process.............................................    12,612      11,921
Finished goods..............................................    53,722      57,368
                                                              --------    --------
                                                              $104,612    $107,390
                                                              ========    ========


NOTE 4 -- PROPERTY, PLANT AND EQUIPMENT

     Details of property, plant and equipment are as follows (in thousands):



                                                                2000        2001
                                                              --------    --------
                                                                    
Land........................................................  $  1,511    $  4,004
Building and improvements...................................    27,686      67,951
Machinery and equipment.....................................    63,970      68,284
Construction in progress....................................    12,283       1,955
                                                              --------    --------
                                                               105,450     142,194
  Less: Accumulated depreciation............................   (43,000)    (51,168)
                                                              --------    --------
                                                              $ 62,450    $ 91,026
                                                              ========    ========


     We lease various manufacturing and office facilities and equipment under
operating leases. Rental expense on these operating leases was approximately
$2,935,000, $3,376,000 and $2,756,000 for the years ended December 1999, 2000
and 2001, respectively. The aggregate future minimum lease commitments for
operating leases at December 2001 are as follows:



            YEAR ENDING DECEMBER (IN THOUSANDS):
            ------------------------------------
                                                           
2002........................................................  $1,624
2003........................................................   1,255
2004........................................................   1,036
2005........................................................     962
2006........................................................     933
Thereafter..................................................   1,950


                                       F-11


                               CONMED CORPORATION


           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

NOTE 5 -- LONG TERM DEBT

     We have a credit agreement with several banks providing for a $490,000,000
senior credit facility. The senior credit facility is comprised of four
sub-facilities: (i) a $210,000,000 five-year term loan with quarterly principal
repayments; (ii) a $140,000,000 seven-year term loan with quarterly principal
repayments; (iii) a $40,000,000 six-year term loan with quarterly principal
repayments; and (iv) a $100,000,000 revolving credit facility. The revolving
credit facility expires on December 30, 2002 and therefore has been classified
in the current portion of long-term debt; it is expected to be renegotiated
during 2002. During the commitment period, we are obligated to pay a fee of
..375% per annum on the unused portion of the revolving credit facility. As of
December 2001, we had $13,300,000, $77,220,000, $34,340,000 and $58,000,000
outstanding under the five-year term loan, the seven-year term loan, the six
year term loan and the revolving credit facility, respectively.

     The borrowings under the senior credit facility carry interest rates based
on a spread over LIBOR or an alternative base interest rate. The covenants of
the senior credit facility provide for increases and decreases to this interest
rate spread based on our operating results. Additionally, certain events of
default under the credit facility limit interest rate options available to us.
The weighted average interest rates at December 2001 under the five-year term
loan, the seven-year term loan, the six year term loan and the revolving credit
facility, were 4.00%, 4.43%, 4.60% and 3.93%, respectively.

     The term debt and revolving credit facility are collateralized by
substantially all of our personal property and assets, except for our accounts
receivable and related rights which are pledged in connection with the accounts
receivable sales agreement discussed in Note 1. The agreement contains covenants
and restrictions which, among other things, require maintenance of certain
working capital levels and financial ratios, prohibit dividend payments and
restrict the incurrence of certain indebtedness and other activities, including
acquisitions and dispositions. We are also required to make mandatory
prepayments from net cash proceeds from any issue of equity and asset sales.
Mandatory prepayments are to be applied first to the prepayment of the term
loans and then to reduce borrowings under the revolving credit facility.

     The debt assumed in connection with the Largo acquisition (Note 2),
consists of a note bearing interest at 7.50% per annum with semiannual payments
of principal and interest through June 2009 (the "Class A note"); and a note
bearing interest at 8.25% per annum compounded semiannually through June 2009,
after which semiannual payments of principal and interest will commence,
continuing through June 2019 (the "Class C note"). Additionally, there is a
seller-financed note which bears interest at 6.50% per annum with monthly
payments of principal and interest through July 2013 (the "Seller note"). The
principal balances assumed on the Class A note, Class C note and Seller note
aggregate $12,185,000, $6,191,000 and $4,228,000, respectively, at the date of
acquisition. The principal balances outstanding related to the Largo
acquisition, aggregated $11,724,000, $6,402,000 and $4,157,000, at December 2001
on the Class A note, Class C note and Seller note respectively. The Largo
acquisition related debt is collateralized by, among other things, recorded and
unrecorded mortgage liens on the Largo property.

     We have $130,000,000 of 9% Senior Subordinated Notes (the "Notes")
outstanding. The Notes mature on March 15, 2008, unless previously redeemed by
us. Interest on the Notes is payable semi-annually on March 15 and September 15
of each year. The Notes are redeemable for cash at anytime on or after March 15,
2003, at our option, in whole or in part, at the redemption prices set forth
therein, plus accrued and unpaid interest to the date of redemption.

     As discussed in Note 1, we use an interest rate swap, a form of derivative
financial instrument, to manage interest rate risk. We have designated as a
cash-flow hedge, an interest rate swap which effectively converts $50,000,000 of
LIBOR-based floating rate debt under our senior credit facility into fixed rate
debt with a base interest rate of 7.01%. The interest rate swap expires in June
2003 and is included in liabilities on the balance sheet with a fair value
approximating $3,072,000.

                                       F-12


                               CONMED CORPORATION


           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     Excluding the revolving credit facility which expires and is expected to be
renegotiated in 2002, the scheduled maturities of long-term debt outstanding at
December 2001 are as follows:


                                                           
YEAR ENDING DECEMBER (IN THOUSANDS):

2002........................................................  $ 15,429
2003........................................................    43,364
2004........................................................    36,749
2005........................................................    35,181
2006........................................................     1,943
Thereafter..................................................   145,263


NOTE 6 -- INCOME TAXES

     The provision for income taxes consists of the following (in thousands):



                                                         1999       2000       2001
                                                        -------    -------    -------
                                                                     
Current tax expense:
  Federal...........................................    $ 5,027    $ 1,634    $ 3,565
  State.............................................        350        300        400
  Foreign...........................................        922        956      1,201
                                                        -------    -------    -------
                                                          6,299      2,890      5,166
Deferred income tax expense.........................      8,978      7,974      8,562
                                                        -------    -------    -------
  Provision for income taxes........................    $15,277    $10,864    $13,728
                                                        =======    =======    =======


     A reconciliation between income taxes computed at the statutory federal
rate and the provision for income taxes follows (in thousands):



                                                         1999       2000       2001
                                                        -------    -------    -------
                                                                     
Tax provision at statutory rate based on income before
  income taxes and extraordinary item.................  $14,853    $10,562    $13,347
Foreign sales corporation.............................     (543)      (725)      (894)
State taxes...........................................      257        180        270
Nondeductible intangible amortization.................      320        321        320
Other nondeductible permanent differences.............      270        200        220
Other, net............................................      120        326        465
                                                        -------    -------    -------
                                                        $15,277    $10,864    $13,728
                                                        =======    =======    =======


                                       F-13


                               CONMED CORPORATION


           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The tax effects of the significant temporary differences which comprise the
deferred tax assets and liabilities at December 2000 and 2001 are as follows (in
thousands):



                                                               2000            2001
                                                             --------        --------
                                                                       
Assets:
  Receivables..............................................  $    138        $    225
  Inventory................................................     1,115             870
  Deferred compensation....................................       761             943
  Employee benefits........................................       221             428
  Deferred rent............................................       570              --
  Additional minimum pension liability.....................        --             597
  Interest rate swap.......................................        --           1,106
  Other....................................................     1,011             164
  Net operating losses of acquired subsidiary..............     3,834           3,410
  Valuation allowance for deferred tax assets..............    (3,834)         (3,410)
                                                             --------        --------
                                                                3,816           4,333
                                                             --------        --------
Liabilities:
  Goodwill and intangible assets...........................    11,559          17,757
  Depreciation.............................................     2,650           4,126
                                                             --------        --------
                                                               14,209          21,883
                                                             --------        --------
Net liability..............................................  $(10,393)       $(17,550)
                                                             ========        ========


     Net operating losses related to an acquisition are subject to certain
limitations and expire over the period 2008 to 2010. Management has established
a valuation allowance of $3,410,000 to reflect the uncertainty of realizing the
benefit of certain of these carryforwards.

NOTE 7 -- SHAREHOLDERS' EQUITY

     The shareholders have authorized 500,000 shares of preferred stock, par
value $.01 per share, which may be issued in one or more series by the Board of
Directors without further action by the shareholders. As of December 2001, no
preferred stock had been issued.

     On August 8, 2001, our Board of Directors declared a three-for-two split of
our common stock to be effected in the form of a common stock dividend. This
dividend was payable on September 7, 2001 to shareholders of record on August
21, 2001. Accordingly, common stock, the number of shares outstanding, earnings
per share, incentive stock option activity and the number of shares used in the
calculation of earnings per share have all been restated to retroactively
reflect the split.

     In connection with the 1997 acquisition of Linvatec Corporation, we issued
to Bristol-Myers Squibb Company a ten-year warrant to purchase 1.5 million
shares of our common stock at a price of $22.82 per share.

     We have reserved shares of common stock for issuance to employees and
directors under four stock option plans (the "Plans"). The exercise price on all
outstanding options is equal to the quoted fair market value of the stock at the
date of grant. Stock options are non-transferable other than on death and
generally become exercisable over a five year period from date of grant and
expire ten years from date of grant.

                                       F-14


                               CONMED CORPORATION


           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The following is a summary of incentive stock option activity under the
Plans (in thousands, except per share amounts):



                                                            NUMBER OF    WEIGHTED-AVERAGE
                                                             SHARES       EXERCISE PRICE
                                                            ---------    ----------------
                                                                   
Outstanding at December 1998..............................    2,250           $11.93
  Granted during 1999.....................................      602            19.75
  Forfeited...............................................      (14)           15.27
  Exercised...............................................     (182)            8.88
                                                              -----           ------
Outstanding at December 1999..............................    2,656            13.96
  Granted during 2000.....................................      684            14.05
  Forfeited...............................................     (209)           17.20
  Exercised...............................................      (72)            6.23
                                                              -----           ------
Outstanding at December 2000..............................    3,059            13.91
  Granted during 2001.....................................      709            15.59
  Forfeited...............................................      (75)           18.86
  Exercised...............................................     (259)            7.07
                                                              -----           ------
Outstanding at December 2001..............................    3,434           $14.69
                                                              =====           ======
Exercisable:
  December 1999...........................................    1,418           $10.89
  December 2000...........................................    1,674            12.31
  December 2001...........................................    1,954            13.59




                                              WEIGHTED
                          STOCK OPTIONS       AVERAGE          WEIGHTED      STOCK OPTIONS       WEIGHTED
                          OUTSTANDING AT   REMAINING LIFE      AVERAGE       EXERCISABLE AT      AVERAGE
RANGE OF EXERCISE PRICES  DECEMBER 2001       (YEARS)       EXERCISE PRICE   DECEMBER 2001    EXERCISE PRICE
------------------------  --------------   --------------   --------------   --------------   --------------
                                                                               
Less than $5.00                42,000           1.6             $3.57            42,000           $3.57
$5.00 to $7.50                392,000           1.5              7.05           392,000            7.05
$7.50 to $10.00               287,000           7.8              9.01           224,000            8.97
$10.00 to $15.00              905,000           8.0             13.83           287,000           13.25
$15.00 to $17.50            1,000,000           6.6             16.36           638,000           16.34
$17.50 to $20.00              471,000           7.6             19.05           222,000           19.31
$20.00 to $23.00              337,000           7.4             21.07           149,000           20.87


     Statement of Financial Accounting Standards No. 123, "Accounting for
Stock-Based Compensation" ("SFAS 123") defines a fair value based method of
accounting for an employee stock option whereby compensation cost is measured at
the grant date based on the fair value of the award and is recognized over the
service period. A company may elect to adopt SFAS 123 or elect to continue
accounting for its stock option or similar equity awards using the method of
accounting prescribed by Accounting Principles Board Opinion ("APB") No. 25,
"Accounting for Stock Issued to Employees", where compensation cost is measured
at the date of grant based on the excess of the market value of the underlying
stock over the exercise price. We have elected to continue to account for our
stock-based compensation plans under the provisions of APB No. 25. No
compensation expense has been recognized in the accompanying financial
statements relative to our stock option plans.

     Pro forma information regarding net income and earnings per share is
required by SFAS 123 and has been determined as if we had accounted for our
employee stock options under the fair value method of that statement. The
weighted average fair value of options granted in 1999, 2000 and 2001 was $8.85,

                                       F-15


                               CONMED CORPORATION


           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

$8.55 and $7.39, respectively. The fair value of these options was estimated at
the date of grant using a Black-Scholes options pricing model with the following
weighted-average assumptions for options granted in 1999, 2000 and 2001,
respectively: Risk-free interest rates of 6.46%, 5.06% and 4.38%; volatility
factors of the expected market price of the Company's common stock of 39.23%,
68.01% and 48.04%; a weighted-average expected life of the option of five years;
and that no dividends would be paid on common stock.

     For purposes of the pro forma disclosures, the estimated fair value of the
options is amortized to expense over the options' vesting period. The Company's
pro forma information follows (in thousands, except for earnings per share
information):



                                                         1999       2000       2001
                                                        -------    -------    -------
                                                                     
Net income -- as reported.............................  $27,159    $19,314    $24,406
Net income -- pro forma...............................   24,678     16,167     21,561
EPS -- as reported:
  Basic...............................................     1.19        .84       1.02
  Diluted.............................................     1.17        .83       1.00
EPS -- pro forma
  Basic...............................................     1.08        .70        .90
  Diluted.............................................     1.07        .69        .88


NOTE 8 -- BUSINESS SEGMENTS, GEOGRAPHIC AREAS AND MAJOR CUSTOMERS

     CONMED's business is organized, managed and internally reported as a single
segment comprised of medical instruments and systems used in surgical and other
medical procedures. We believe our product lines have similar economic,
operating and other related characteristics.

     The following is net sales information for geographic areas (in thousands):



                                                       1999        2000        2001
                                                     --------    --------    --------
                                                                    
United States......................................  $285,048    $288,514    $306,306
All other countries................................    91,178     107,359     122,416
                                                     --------    --------    --------
Total..............................................  $376,226    $395,873    $428,722
                                                     ========    ========    ========


     There were no significant investments in long-lived assets located outside
the United States at December 2000 and 2001.

NOTE 9 -- PENSION PLANS

     We maintain defined benefit plans covering substantially all employees. We
make annual contributions to the plans equal to the maximum deduction allowed
for federal income tax purposes.

     Net pension cost for 1999, 2000 and 2001 included the following components
(in thousands):



                                                           1999      2000      2001
                                                          -------   -------   -------
                                                                     
Service cost -- benefits earned during the period.......  $ 2,592   $ 2,658   $ 3,622
Interest cost on projected benefit obligation...........    1,349     1,608     1,785
Expected return on plan assets..........................   (1,090)   (1,121)   (1,211)
Net amortization and deferral...........................       41        21       166
                                                          -------   -------   -------
Net pension cost........................................  $ 2,892   $ 3,166   $ 4,362
                                                          =======   =======   =======


                                       F-16


                               CONMED CORPORATION


           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The following table sets forth the plans' funded status and amounts
recognized in the consolidated balance sheets at December 2000 and 2001 (in
thousands):




                                                               2000      2001
                                                              -------   -------
                                                                  
Change In Benefit Obligation
Projected benefit obligation at beginning of year...........  $19,737   $22,949
Service cost................................................    2,658     3,622
Interest cost...............................................    1,608     1,785
Actuarial loss (gain).......................................    2,834     4,597
Benefits paid...............................................   (3,888)   (3,205)
                                                              -------   -------
Projected benefit obligation at end of year.................  $22,949   $29,748
                                                              -------   -------
Change In Plan Assets
Fair value of plan assets at beginning of year..............  $12,759   $13,077
Actual return on plan assets................................      312       432
Employer contribution.......................................    3,894     6,659
Benefits paid...............................................   (3,888)   (3,205)
                                                              -------   -------
Fair value of plan assets at end of year....................  $13,077   $16,963
                                                              -------   -------
Change In Funded Status
Funded status...............................................  $ 9,872   $12,785
Unrecognized net actuarial loss.............................   (3,837)   (9,062)
Unrecognized transition liability...........................      (60)      (56)
Unrecognized prior service cost.............................     (151)     (140)
Additional minimum pension liability........................       --     1,659
                                                              -------   -------
Accrued pension cost........................................  $ 5,824   $ 5,186
                                                              =======   =======



     For 1999, 2000 and 2001 actuarial calculation purposes, the weighted
average discount rate was 7.0%, 7.5% and 7.0%, respectively, the expected long
term rate of return was 8.0% and the rate of increase in future compensation
levels was 4.5%.

     The projected benefit obligation, accumulated benefit obligation and fair
value of plan assets for the pension plan with accumulated benefit obligations
in excess of plan assets were $16,447,000, $11,672,000 and $8,087,000
respectively, as of December 2001. CONMED common stock valued at $315,000 and
$550,000 was held by the plans at December 2000 and 2001, respectively.

NOTE 10 -- LEGAL MATTERS

     From time to time, we have been named as a defendant in certain lawsuits
alleging product liability, patent infringement, or other claims incurred in the
ordinary course of business. Certain of these claims are covered by various
insurance policies, subject to deductible amounts and maximum policy limits.
Ultimate liability with respect to these contingencies, if any, is not
considered to be material to the consolidated financial statements of the
Company.

NOTE 11 -- UNUSUAL ITEMS

     During the quarter ended December 1999, we recognized a benefit related to
a previously recorded litigation accrual which was settled on favorable terms.
This nonrecurring benefit amounted to $1,256,000, before income taxes, or $.03
per diluted share and is included in selling and administrative expense.

     During the quarter ended June 2000, we announced we would replace our
arthroscopy direct sales force with non-stocking, exclusive sales agent groups
in certain geographic regions of the United States. As
                                       F-17


                               CONMED CORPORATION


           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

a result, we incurred a severance charge of $1,509,000, before income taxes, or
$.04 per diluted share, in the second quarter of 2000. This nonrecurring charge
is included in selling and administrative expense.

     As discussed in Note 2, during the third and fourth quarters of 2001, we
incurred certain charges related to the second Imagyn acquisition. These costs
were primarily related to the transition in manufacturing of the Imagyn product
lines from Imagyn's Richland, Michigan facility to our manufacturing plants in
Utica, New York. Such costs totaled $886,000 and $681,000, respectively, before
income taxes, or $.02 per diluted share in each of the third and fourth quarters
of 2001. These nonrecurring charges are included in cost of sales.

NOTE 12 -- SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)

     Selected quarterly financial data for 2000 and 2001 are as follows (in
thousands, except per share amounts):



                                                         THREE MONTHS ENDED
                                             ------------------------------------------
                                              MARCH       JUNE     SEPTEMBER   DECEMBER
                                             --------   --------   ---------   --------
                                                                   
2000
Net sales..................................  $102,811   $ 97,878   $ 92,838    $102,346
Gross profit...............................    54,150     50,551     48,702      54,247
Net income.................................     7,409      3,516      2,729       5,660
Earnings per share:
  Basic....................................      0.32       0.15       0.12        0.25
  Diluted..................................      0.32       0.15       0.12        0.24
2001
Net sales..................................  $105,909   $104,171   $105,318    $113,324
Gross profit...............................    56,235     54,206     53,986      59,921
Net income.................................     6,003      5,734      5,015       7,654
Earnings per share:
  Basic....................................      0.26       0.25       0.20        0.30
  Diluted..................................      0.26       0.25       0.20        0.30


     As discussed in Note 11, during the quarter ended June 2000, we incurred a
severance charge of $1,509,000, before income taxes, or $.04 per diluted share,
related to a restructuring of our arthroscopy sales force. This nonrecurring
charge is included in selling and administrative expense.

     As discussed in Notes 2 and 11, during the third and fourth quarters of
2001, we incurred certain transition charges related to the second Imagyn
acquisition. Such costs totaled $886,000 and $681,000, respectively, before
income taxes, or $.02 per diluted share in each of the third and fourth quarters
of 2001. These nonrecurring charges are included in cost of sales.

NOTE 13 -- GUARANTOR FINANCIAL STATEMENTS

     Our credit facility and subordinated notes (the "Notes") are guaranteed
(the "Subsidiary Guarantees") by each of our subsidiaries (the "Subsidiary
Guarantors") except CRC (the "Non-Guarantor Subsidiary"). The Subsidiary
Guarantees provide that each Subsidiary Guarantor will fully and unconditionally
guarantee our obligations under the credit facility and the Notes on a joint and
several basis. Each Subsidiary Guarantor and Non-Guarantor Subsidiary is
wholly-owned by CONMED Corporation. The following supplemental financial
information sets forth on a condensed consolidating basis, consolidating balance
sheet, statement of income and statement of cash flows for the Parent Company
Only, Subsidiary Guarantors and Non-Guarantor Subsidiary and for the Company as
of December 2000 and 2001 and for the years ended December 1999, 2000 and 2001.

                                       F-18


                               CONMED CORPORATION


           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

                     CONSOLIDATING CONDENSED BALANCE SHEET

                              AT DECEMBER 31, 2000

                                 (IN THOUSANDS)



                                                 PARENT
                                                COMPANY     SUBSIDIARY                    COMPANY
                                                  ONLY      GUARANTORS    ELIMINATIONS     TOTAL
                                                --------    ----------    ------------    --------
                                                                              
ASSETS
Current assets:
  Cash and cash equivalents...................  $     --     $  3,470      $      --      $  3,470
  Accounts receivable, net....................    35,218       43,408             --        78,626
  Inventories.................................    20,174       84,438             --       104,612
  Deferred income taxes.......................     1,761           --             --         1,761
  Prepaid expenses and other current assets...       598        2,964             --         3,562
                                                --------     --------      ---------      --------
     Total current assets.....................    57,751      134,280             --       192,031
                                                --------     --------      ---------      --------
Property, plant and equipment, net............    38,275       24,175             --        62,450
Goodwill, net.................................    61,651      164,150             --       225,801
Other intangible assets, net..................     7,498      187,510             --       195,008
Other assets..................................   473,408        5,217       (474,344)        4,281
                                                --------     --------      ---------      --------
     Total assets.............................  $638,583     $515,332      $(474,344)     $679,571
                                                ========     ========      =========      ========

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
  Current portion of long-term debt...........  $ 36,068     $     --      $      --      $ 36,068
  Accounts payable............................     4,398       15,952             --        20,350
  Accrued compensation........................     2,147        7,766             --         9,913
  Income taxes payable........................     1,338          641             --         1,979
  Accrued interest............................     5,130           --             --         5,130
  Other current liabilities...................     1,890        2,946             --         4,836
                                                --------     --------      ---------      --------
     Total current liabilities................    50,971       27,305             --        78,276
                                                --------     --------      ---------      --------
Long-term debt................................   342,680           --             --       342,680
Deferred income taxes.........................    12,154           --             --        12,154
Other long-term liabilities...................     2,175      349,295       (335,612)       15,858
                                                --------     --------      ---------      --------
     Total liabilities........................   407,980      376,600       (335,612)      448,968
                                                --------     --------      ---------      --------
Shareholders' equity:
  Preferred stock.............................        --           --             --            --
  Common stock................................       230            1             (1)          230
  Paid-in capital.............................   127,985           --             --       127,985
  Retained earnings...........................   103,834      139,758       (139,758)      103,834
  Accumulated other comprehensive loss........    (1,027)      (1,027)         1,027        (1,027)
  Less common stock in treasury, at cost......      (419)          --             --          (419)
                                                --------     --------      ---------      --------
     Total shareholders' equity...............   230,603      138,732       (138,732)      230,603
                                                --------     --------      ---------      --------
     Total liabilities and shareholders'
       equity.................................  $638,583     $515,332      $(474,344)     $679,571
                                                ========     ========      =========      ========


                                       F-19


                               CONMED CORPORATION


           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

                     CONSOLIDATING CONDENSED BALANCE SHEET

                              AT DECEMBER 31, 2001

                                 (IN THOUSANDS)



                                          PARENT                    NON-
                                         COMPANY    SUBSIDIARY   GUARANTOR                   COMPANY
                                           ONLY     GUARANTORS   SUBSIDIARY   ELIMINATIONS    TOTAL
                                         --------   ----------   ----------   ------------   --------
                                                                              
ASSETS
Current assets:
  Cash and cash equivalents............  $     --    $  1,181     $   221      $      --     $  1,402
  Accounts receivable, net.............        --       7,198      43,990             --       51,188
  Inventories..........................    23,045      84,345          --             --      107,390
  Deferred income taxes................     1,105          --          --             --        1,105
  Prepaid expenses and other current
     assets............................       831       2,633          --             --        3,464
                                         --------    --------     -------      ---------     --------
     Total current assets..............    24,981      95,357      44,211             --      164,549
                                         --------    --------     -------      ---------     --------
Property, plant and equipment, net.....    45,856      45,170          --             --       91,026
Goodwill, net..........................    86,412     164,728          --             --      251,140
Other intangible assets, net...........     8,177     181,575          --             --      189,752
Other assets...........................   477,798       2,376          --       (475,033)       5,141
                                         --------    --------     -------      ---------     --------
     Total assets......................  $643,224    $489,206     $44,211      $(475,033)    $701,608
                                         ========    ========     =======      =========     ========

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
  Current portion of long-term debt....  $ 72,241    $  1,188     $    --      $      --     $ 73,429
  Accounts payable.....................     5,078      14,799          --             --       19,877
  Accrued compensation.................     3,979       7,884          --             --       11,863
  Income taxes payable.................     2,372         135          --             --        2,507
  Accrued interest.....................     4,760          37         157             --        4,954
  Other current liabilities............     4,634       2,573          --             --        7,207
                                         --------    --------     -------      ---------     --------
     Total current liabilities.........    93,064      26,616         157             --      119,837
                                         --------    --------     -------      ---------     --------
Long-term debt.........................   241,404      21,096          --             --      262,500
Deferred income taxes..................    18,655          --          --             --       18,655
Other long-term liabilities............     6,467     285,329      41,947       (316,761)      16,982
                                         --------    --------     -------      ---------     --------
     Total liabilities.................   359,590     333,041      42,104       (316,761)     417,974
                                         --------    --------     -------      ---------     --------
Shareholders' equity:
  Preferred stock......................        --          --          --             --           --
  Common stock.........................       253           1          --             (1)         253
  Paid-in capital......................   160,757          --       2,000         (2,000)     160,757
  Retained earnings....................   128,240     158,333         107       (158,440)     128,240
  Accumulated other comprehensive
     loss..............................    (5,197)     (2,169)         --          2,169       (5,197)
  Less common stock in treasury, at
     cost..............................      (419)         --          --             --         (419)
                                         --------    --------     -------      ---------     --------
     Total shareholders' equity........   283,634     156,165       2,107       (158,272)     283,634
                                         --------    --------     -------      ---------     --------
     Total liabilities and
       shareholders' equity............  $643,224    $489,206     $44,211      $(475,033)    $701,608
                                         ========    ========     =======      =========     ========


                                       F-20


                               CONMED CORPORATION


           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

                  CONSOLIDATING CONDENSED STATEMENT OF INCOME
                            YEAR ENDED DECEMBER 1999
                                 (IN THOUSANDS)




                                              PARENT       SUBSIDIARY
                                           COMPANY ONLY    GUARANTORS    ELIMINATIONS    COMPANY TOTAL
                                           ------------    ----------    ------------    -------------
                                                                             
Net sales................................    $83,612        $292,614       $     --        $376,226
                                             -------        --------       --------        --------
Cost of sales............................     47,178         131,302             --         178,480
Selling and administrative expense.......     26,338          84,504             --         110,842
Research and development expense.........      1,626          10,482             --          12,108
                                             -------        --------       --------        --------
                                              75,142         226,288             --         301,430
                                             -------        --------       --------        --------
Income from operations...................      8,470          66,326             --          74,796
Interest expense, net....................         --          32,360             --          32,360
                                             -------        --------       --------        --------
Income before income taxes...............      8,470          33,966             --          42,436
Provision for income taxes...............      3,049          12,228             --          15,277
                                             -------        --------       --------        --------
Income before equity in earnings of
  unconsolidated subsidiaries............      5,421          21,738             --          27,159
Equity in earnings of unconsolidated
  subsidiaries...........................     21,738              --        (21,738)             --
                                             -------        --------       --------        --------
Net income...............................    $27,159        $ 21,738       $(21,738)       $ 27,159
                                             =======        ========       ========        ========



                                       F-21


                               CONMED CORPORATION


           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

                  CONSOLIDATING CONDENSED STATEMENT OF INCOME
                            YEAR ENDED DECEMBER 2000
                                 (IN THOUSANDS)



                                              PARENT       SUBSIDIARY
                                           COMPANY ONLY    GUARANTORS    ELIMINATIONS    COMPANY TOTAL
                                           ------------    ----------    ------------    -------------
                                                                             
Net sales................................    $73,632        $322,241       $     --        $395,873
                                             -------        --------       --------        --------
Cost of sales............................     42,461         145,762             --         188,223
Selling and administrative expense.......     20,015         108,301             --         128,316
Research and development expense.........      1,907          12,963             --          14,870
                                             -------        --------       --------        --------
                                              64,383         267,026             --         331,409
                                             -------        --------       --------        --------
Income from operations...................      9,249          55,215             --          64,464
Interest expense, net....................         --          34,286             --          34,286
                                             -------        --------       --------        --------
Income before income taxes...............      9,249          20,929             --          30,178
Provision for income taxes...............      3,330           7,534             --          10,864
                                             -------        --------       --------        --------
Income before equity in earnings of
  unconsolidated subsidiaries............      5,919          13,395             --          19,314
Equity in earnings of unconsolidated
  subsidiaries...........................     13,395              --        (13,395)             --
                                             -------        --------       --------        --------
Net income...............................    $19,314        $ 13,395       $(13,395)       $ 19,314
                                             =======        ========       ========        ========


                                       F-22


                               CONMED CORPORATION


           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

                  CONSOLIDATING CONDENSED STATEMENT OF INCOME
                            YEAR ENDED DECEMBER 2001
                                 (IN THOUSANDS)



                               PARENT       SUBSIDIARY    NON-GUARANTOR
                            COMPANY ONLY    GUARANTORS     SUBSIDIARY      ELIMINATIONS    COMPANY TOTAL
                            ------------    ----------    -------------    ------------    -------------
                                                                            
Net sales.................    $91,609        $337,113         $  --          $     --        $428,722
                              -------        --------         -----          --------        --------
Cost of sales.............     53,534         150,840            --                --         204,374
Selling and administrative
  expense.................     27,620         113,302          (362)               --         140,560
Research and development
  expense.................      1,511          13,319            --                --          14,830
                              -------        --------         -----          --------        --------
                               82,665         277,461          (362)               --         359,764
                              -------        --------         -----          --------        --------
Income from operations....      8,944          59,652           362                --          68,958
Interest expense, net.....         --          30,629           195                --          30,824
                              -------        --------         -----          --------        --------
Income before income
  taxes...................      8,944          29,023           167                --          38,134
Provision for income
  taxes...................      3,220          10,448            60                --          13,728
                              -------        --------         -----          --------        --------
Income before equity in
  earnings of
  unconsolidated
  subsidiaries............      5,724          18,575           107                --          24,406
Equity in earnings of
  unconsolidated
  subsidiaries............     18,682              --            --           (18,682)             --
                              -------        --------         -----          --------        --------
Net income................    $24,406        $ 18,575         $ 107          $(18,682)       $ 24,406
                              =======        ========         =====          ========        ========


                                       F-23


                               CONMED CORPORATION


           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

                CONSOLIDATING CONDENSED STATEMENT OF CASH FLOWS
                            YEAR ENDED DECEMBER 1999
                                 (IN THOUSANDS)



                                                 PARENT      SUBSIDIARY                     COMPANY
                                              COMPANY ONLY   GUARANTORS   ELIMINATIONS       TOTAL
                                              ------------   ----------   ------------   -------------
                                                                             
Net cash flows from operating activities....    $ 11,784      $ 25,657      $     --       $ 37,441
                                                --------      --------      --------       --------
Cash flows from investing activities:
  Distributions to subsidiaries.............     (21,885)           --        21,885             --
  Payments related to business
     acquisitions...........................          --       (40,585)           --        (40,585)
  Purchases of property, plant and
     equipment..............................      (4,801)       (4,551)           --         (9,352)
                                                --------      --------      --------       --------
     Net cash provided (used) by investing
       activities...........................     (26,686)      (45,136)       21,885        (49,937)
                                                --------      --------      --------       --------
Cash flows from financing:
  Proceeds of long-term debt................      40,900            --            --         40,900
  Distributions from parent.................          --        21,885       (21,885)            --
  Repayments under revolving credit
     facility...............................      (8,000)           --            --         (8,000)
  Proceeds from issuance of common stock....       1,612            --            --          1,612
  Payments related to issuance of long-term
     debt...................................        (661)           --            --           (661)
  Payments on long-term debt................     (23,103)           --            --        (23,103)
                                                --------      --------      --------       --------
     Net cash provided (used) by financing
       activities...........................      10,748        21,885       (21,885)        10,748
                                                --------      --------      --------       --------
Effect of exchange rate changes on cash and
  cash equivalents..........................          --          (411)           --           (411)
                                                --------      --------      --------       --------
Net decrease in cash and cash equivalents...      (4,154)        1,995            --         (2,159)
Cash and cash equivalents at beginning of
  period....................................       4,752         1,154            --          5,906
                                                --------      --------      --------       --------
Cash and cash equivalents at end of
  period....................................    $    598      $  3,149      $     --       $  3,747
                                                ========      ========      ========       ========


                                       F-24


                               CONMED CORPORATION


           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

                CONSOLIDATING CONDENSED STATEMENT OF CASH FLOWS
                            YEAR ENDED DECEMBER 2000
                                 (IN THOUSANDS)



                                                 PARENT      SUBSIDIARY                     COMPANY
                                              COMPANY ONLY   GUARANTORS   ELIMINATIONS       TOTAL
                                              ------------   ----------   ------------   -------------
                                                                             
Net cash flows from operating activities....    $ 18,238      $ 17,712      $     --       $ 35,950
                                                --------      --------      --------       --------
Cash flows from investing activities:
  Distributions from subsidiaries...........      13,618            --       (13,618)            --
  Payments related to business
     acquisitions...........................      (6,042)           --            --         (6,042)
  Purchases of property, plant and
     equipment..............................     (10,940)       (3,110)           --        (14,050)
                                                --------      --------      --------       --------
     Net cash provided (used) by investing
       activities...........................      (3,364)       (3,110)      (13,618)       (20,092)
                                                --------      --------      --------       --------
Cash flows from financing:
  Distributions to parent...................          --       (13,618)       13,618             --
  Borrowings under revolving credit
     facility...............................      17,000            --            --         17,000
  Proceeds from issuance of common stock....         449            --            --            449
  Payments on long-term debt................     (32,921)           --            --        (32,921)
                                                --------      --------      --------       --------
     Net cash provided (used) by financing
       activities...........................     (15,472)      (13,618)       13,618        (15,472)
                                                --------      --------      --------       --------
Effect of exchange rate changes on cash and
  cash equivalents..........................          --          (663)           --           (663)
                                                --------      --------      --------       --------
Net increase (decrease) in cash and cash
  equivalents...............................        (598)          321            --           (277)
Cash and cash equivalents at beginning of
  period....................................         598         3,149            --          3,747
                                                --------      --------      --------       --------
Cash and cash equivalents at end of
  period....................................    $     --      $  3,470      $     --       $  3,470
                                                ========      ========      ========       ========


                                       F-25


                               CONMED CORPORATION


           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

                     CONSOLIDATING STATEMENT OF CASH FLOWS
                            YEAR ENDED DECEMBER 2001
                                 (IN THOUSANDS)



                                      PARENT      SUBSIDIARY   NON-GUARANTOR                  COMPANY
                                   COMPANY ONLY   GUARANTORS    SUBSIDIARY     ELIMINATIONS    TOTAL
                                   ------------   ----------   -------------   ------------   --------
                                                                               
Net cash flows from operating
  activities.....................    $ 44,301      $ 74,574      $ 40,264        $(81,990)    $ 77,149
                                     --------      --------      --------        --------     --------
Cash flows from investing
  activities:
  Distributions from
     subsidiaries................      71,629            --            --         (71,629)          --
  Note payable from subsidiary...     (41,947)           --            --          41,947           --
  Net purchases of accounts
     receivable..................          --            --       (81,990)         81,990           --
  Purchases of property, plant
     and equipment...............     (10,390)       (4,053)           --              --      (14,443)
                                     --------      --------      --------        --------     --------
     Net cash provided (used) by
       investing activities......      19,292        (4,053)      (81,990)         52,308      (14,443)
                                     --------      --------      --------        --------     --------
Cash flows from financing:
  Distributions to parent........          --       (71,629)           --          71,629           --
  Note payable to parent
     company.....................          --            --        41,947         (41,947)          --
  Borrowings under revolving
     credit facility.............      11,000            --            --              --       11,000
  Proceeds from issuance of
     common stock................       1,830            --            --              --        1,830
  Payments on long-term debt.....     (76,423)           --            --              --      (76,423)
                                     --------      --------      --------        --------     --------
     Net cash provided (used) by
       financing activities......     (63,593)      (71,629)       41,947          29,682      (63,593)
                                     --------      --------      --------        --------     --------
Effect of exchange rate changes
  on cash and cash equivalents...          --        (1,181)           --              --       (1,181)
                                     --------      --------      --------        --------     --------
Net increase (decrease) in cash
  and cash equivalents...........          --        (2,289)          221              --       (2,068)
Cash and cash equivalents at
  beginning of period............          --         3,470            --              --        3,470
                                     --------      --------      --------        --------     --------
Cash and cash equivalents at end
  of period......................    $     --      $  1,181      $    221        $     --     $  1,402
                                     ========      ========      ========        ========     ========


                                       F-26



                        [PICTURES OF CERTAIN PRODUCTS OF


                       CONMED CORPORATION'S PATIENT CARE


                              AND ENDOSCOPY UNITS]



--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
                                3,000,000 SHARES

                               CONMED CORPORATION
                                  COMMON STOCK

                           [CONMED CORPORATION LOGO]

                                  ------------
                                   PROSPECTUS

                                  May   , 2002


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

                              SALOMON SMITH BARNEY
                                  UBS WARBURG
                            NEEDHAM & COMPANY, INC.
                            FIRST ALBANY CORPORATION
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------


                                    PART II

                     INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 14.  OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION*

     The following are the estimated expenses of the issuance and distribution
of the securities being registered, all of which will be paid by the Registrant.


                                                           
SEC registration fee........................................  $8,026
NASD filing fee.............................................   9,224
Blue sky fees and expenses..................................
Printing and engraving expenses.............................
Legal fees and expenses.....................................
Accounting fees and expenses................................
Transfer agent fees and expenses............................
Listing fee.................................................
Miscellaneous...............................................
                                                              ------
  Total.....................................................  $
                                                              ======


---------------
* All amounts are estimated except for the SEC registration fee and NASD filing
  fee.

ITEM 15.  INDEMNIFICATION OF OFFICERS AND DIRECTORS

     Section 722 of the New York Business Corporation Law (the "New York Law")
provides that a corporation may indemnify an officer or director, in the case of
third party actions, against judgments, fines, amounts paid in settlement and
reasonable expenses and, in the case of derivative actions, against amounts paid
in settlement and reasonable expenses, if the director or officer "acted, in
good faith, for a purpose which he reasonably believed to be in . . . the best
interests of the corporation" and, in the case of criminal actions, "had no
reasonable cause to believe that his conduct was unlawful." Statutory
indemnification may not be provided in derivative actions in respect of a
threatened action, or a pending action which is settled or otherwise disposed
of, or any claim, issue or matter as to which such person shall have been
adjudged to be liable to the corporation, unless and only to the extent that the
court in which the action was brought, or, if no action was brought, any court
of competent jurisdiction, determines upon application that, in view of all of
the circumstances of the case, the person is fairly and reasonably entitled to
indemnity for such portion of the settlement and expenses as the court deems
proper.

     As contemplated by New York Law Section 721, CONMED's Bylaws, as amended on
December 26, 1990, provide a broader basis for indemnification in accordance
with and as permitted by New York Law Article 7.

          Section 6.6 of CONMED's Bylaws provides as follows:

             Section 6.6 INDEMNIFICATION.  The Corporation shall indemnify each
        person made or threatened to be made a party to any action or
        proceeding, whether civil or criminal, by reason of the fact that such
        person or such person's testator or intestate is or was a director or
        officer of the Corporation, or serves or served at the request of the
        Corporation, any other corporation, partnership, joint venture, trust,
        employee benefit plan or other enterprise in any capacity, against
        judgments, fines, penalties, amounts paid in settlement and reasonable
        expenses, including attorneys' fees, incurred in connection with such
        action or proceeding, or any appeal therein, provided that no such
        indemnification shall be made if a judgment or other final adjudication
        adverse to such person establishes that his or her acts were committed
        in bad faith or were the result of active and deliberate dishonesty and
        were material to the cause of action so adjudicated, or that he or she
        personally gained in fact a financial profit or other advantage to which
        he or she was not legally entitled, and provided further that no such
        indemnification shall be required with
                                       II-1


        respect to any settlement or other nonadjudicated disposition of any
        threatened or pending action or proceeding unless the Corporation has
        given its prior consent to such settlement or other disposition.

             The Corporation may advance or promptly reimburse upon request any
        person entitled to indemnification hereunder for all expenses, including
        attorneys' fees, reasonably incurred in defending any action or
        proceeding in advance of the final disposition thereof upon receipt of
        an undertaking by or on behalf of such person to repay such amount if
        such person is ultimately found not to be entitled to indemnification
        or, where indemnification is granted, to the extent the expenses so
        advanced or reimbursed exceed the amount to which such person is
        entitled, provided, however, that such person shall cooperate in good
        faith with any request by the Corporation that common counsel be
        utilized by the parties to an action or proceeding who are similarly
        situated unless to do so would be inappropriate due to actual or
        potential differing interests between or among such parties.

             Anything in these bylaws to the contrary notwithstanding, no
        elimination of this bylaw, and no amendment of this bylaw adversely
        affecting the right of any person to indemnification or advancement of
        expenses hereunder, shall be effective until the 60th day following
        notice to such person of such action, and no elimination of or amendment
        to this bylaw shall deprive any person of his or her rights hereunder
        arising out of alleged or actual occurrences, acts or failures to act
        prior to such 60th day.

             The Corporation shall not, except by elimination or amendment of
        this bylaw in a manner consistent with the preceding paragraph, take any
        corporate action or enter into any agreement which prohibits, or
        otherwise limits the rights of any person to, indemnification in
        accordance with the provisions of this bylaw. The indemnification of any
        person provided by this bylaw shall continue after such person has
        ceased to be a director, officer or employee of the Corporation and
        shall inure to the benefit of such person's heirs, executors,
        administrators and legal representatives.

             The Corporation is authorized to enter into agreements with any of
        its directors, officers or employees extending rights to indemnification
        and advancement of expenses to such person to the fullest extent
        permitted by applicable law as it currently exists, but the failure to
        enter into any such agreement shall not affect or limit the rights of
        such person pursuant to this bylaw, it being expressly recognized hereby
        that all directors, officers and employees of the Corporation, by
        serving as such after the adoption hereof, are acting in reliance hereon
        and that the Corporation is estopped to contend otherwise.

             In case any provision in this bylaw shall be determined at any time
        to be unenforceable in any respect, the other provisions shall not in
        any way be affected or impaired thereby, and the affected provision
        shall be given the fullest possible enforcement in the circumstances, it
        being the intention of the Corporation to afford indemnification and
        advancement of expenses to its directors, officers and employees, acting
        in such capacities or in the other capacities mentioned herein, to the
        fullest extent permitted by law.

             For purposes of this bylaw, the Corporation shall be deemed to have
        requested a person to serve an employee benefit plan where the
        performance by such person of his or her duties to the Corporation also
        imposes duties on, or otherwise involves services by, such person to the
        plan or participants or beneficiaries of the plan, and excise taxes
        assessed on a person with respect to an employee benefit plan pursuant
        to applicable law shall be considered indemnifiable expenses. For
        purposes of this bylaw, the term "Corporation" shall include any legal
        successor to the Corporation, including any corporation which acquires
        all or substantially all of the assets of the Corporation in one or more
        transactions.

                                       II-2


ITEM 16.  EXHIBITS AND FINANCIAL STATEMENT SCHEDULES




EXHIBIT
  NO.                            DESCRIPTION
-------                          -----------
      
  1      Form of Underwriting Agreement between the Company and the
         Underwriters.*
  5.1    Opinion of Sullivan & Cromwell, as to validity of the common
         stock.*
 23.1    Consent of PricewaterhouseCoopers LLP.
 23.2    Consent of Sullivan & Cromwell (included in Exhibit 5.1).
 24.1    Powers of Attorney.**



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

 * To be filed by Amendment.


**Previously filed.


ITEM 17.  UNDERTAKINGS

     The undersigned registrant hereby undertakes:

          (1) That, for purposes of determining any liability under the
     Securities Act, each filing of the registrant's annual report pursuant to
     Section 13(a) or Section 15(d) of the Securities Exchange Act (and, where
     applicable, each filing of an employee benefit plan's annual report
     pursuant to Section 15(d) of the Securities Exchange Act) that is
     incorporated by reference in the registration statement shall be deemed to
     be a new registration statement relating to the securities offered therein,
     and the offering of such securities at that time shall be deemed to be the
     initial bona fide offering thereof.

          (2) That, for purposes of determining any liability under the
     Securities Act of 1933, the information omitted from the form of prospectus
     filed as part of this registration statement in reliance upon Rule 430A and
     contained in a form of prospectus filed by the registrant pursuant to Rule
     424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be
     part of the registration statement as of the time it was declared
     effective.

          (3) That, for the purpose of determining any liability under the
     Securities Act of 1933, each post-effective amendment that contains a form
     of prospectus shall be deemed to be a new registration statement relating
     to the securities offered therein, and the offering of such securities at
     that time shall be deemed to be the initial bona fide offering thereof.

          (4) Insofar as indemnification for liabilities arising under the
     Securities Act may be permitted to directors, officers and controlling
     persons of the Registrant pursuant to the foregoing provisions, or
     otherwise (other than pursuant to insurance), the Registrant has been
     advised that in the opinion of the Commission such indemnification is
     against public policy as expressed in the Securities Act and may,
     therefore, be unenforceable. In the event that a claim for indemnification
     against such liabilities (other than the payment by the Registrant of
     expenses incurred or paid by a director, officer or controlling person of
     the Registrant in the successful defense of any action, suit or proceeding
     and other than insurance payments) is asserted by such director, officer or
     controlling person in connection with the securities being registered, the
     Registrant will, unless in the opinion of its counsel the matter has been
     settled by controlling precedent, submit to a court of appropriate
     jurisdiction the question whether such indemnification by it is against
     public policy as expressed in the Securities Act and will be governed by
     the final adjudication of such issue.

                                       II-3


                                   SIGNATURES


     Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all the
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Utica and the State of New York, on this 3rd day of
May, 2002.


                                          CONMED CORPORATION

                                          BY:    /s/ JOSEPH J. CORASANTI
                                            ------------------------------------
                                          Name: Joseph J. Corasanti
                                          Title: President & Chief Operating
                                          Officer


                               POWER OF ATTORNEY



     Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed by the following persons in the
capacities indicated on this 3rd day of May, 2002.





SIGNATURE                                                                  TITLE
---------                                                                  -----
                                               

                        *                            Chairman of the Board Chief Executive Officer and
 ------------------------------------------------                         Director
               Eugene R. Corasanti


                        *                            Vice President-Finance and Chief Financial Officer
 ------------------------------------------------              (Principal Financial Officer)
             Robert D. Shallish, Jr.


                        *                             President, Chief Operating Officer and Director
 ------------------------------------------------
               Joseph J. Corasanti


                        *                            Vice President -- Corporate Controller (Principal
 ------------------------------------------------                   Accounting Officer)
                 Luke A. Pomilio


                        *                                                 Director
 ------------------------------------------------
                 Bruce F. Daniels


                        *                                                 Director
 ------------------------------------------------
                Robert E. Remmell


                        *                                                 Director
 ------------------------------------------------
               William D. Matthews


                        *                                                 Director
 ------------------------------------------------
                Stuart J. Schwartz


 *By:              /s/ DANIEL S. JONAS
        ------------------------------------------
                   as Attorney-in-Fact



                                       II-4


                                 EXHIBIT INDEX




EXHIBIT
  NO.                          DESCRIPTION                                      LOCATION
-------                        -----------                                      --------
                                                            
  1      Form of Underwriting Agreement between the Company and   To be filed by Amendment.
         the Underwriters
  5.1    Opinion of Sullivan & Cromwell as to the validity of     To be filed by Amendment.
         the common stock
 23.1    Consent of PricewaterhouseCoopers LLP                    Filed herewith.
 23.2    Consent of Sullivan & Cromwell                           Included in Exhibit 5.1.
 24.1    Powers of Attorney                                       Previously filed.