Cardima Inc · 424B4 · On 6/29/99

Filed On 6/29/99   ·   SEC File 333-74753   ·   Accession Number 1032210-99-988

Prospectus   ·   Rule 424(b)(4)
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 424B4       Prospectus                                            21    112K 

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                                                Filed Pursuant to Rule 424(b)(4)
                                                      Registration No. 333-74753

Dated June 29, 1999 

CARDIMA, INC. 

8,604,806 SHARES

COMMON STOCK

  The securities offered in this prospectus involve a high degree of risk. See
"Risk Factors" beginning on page 4 of this prospectus for information that you  
should consider before purchasing these securities.                             

Our common stock is quoted on the Nasdaq National Market under the symbol 
"CRDM". On June 11, 1999, the closing price of our common stock on the Nasdaq   
was $2.5312 per share.                                                          

This prospectus relates to 8,604,806 shares of Cardima, Inc. common stock 
which may be offered for sale by certain selling stockholders from time to time 
and will not be underwritten.                                                   

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

The date of this Prospectus is June 29, 1999

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TABLE OF CONTENTS 

                                                                · Download Table

                                                                            Page
                                                                            ----
                                                                                
About Cardima..............................................................   3 

Risk Factors...............................................................   4 

Issuance of Common Stock to Selling Stockholders...........................  15 

Use of Proceeds............................................................  15 

Selling Stockholders.......................................................  16 

Plan of Distribution.......................................................  19 

Indemnification of Officers and Directors..................................  19 

Legal Matters..............................................................  19 

Experts....................................................................  20 

Where You Can Find More Information........................................  20 

Information Incorporated by Reference......................................  20 

Additional Information.....................................................  21 

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SPECIAL NOTE: The following discussion contains certain forward-looking   
statements that involve risks and uncertainties. Actual results or events may   
differ materially from those projected in such forward-looking statements.      
Potential risks and uncertainties include those factors below under the heading 
"Risk Factors."                                                                 

ABOUT CARDIMA 

Since our inception, we have focused on the diagnosis and treatment of    
tachycardias, or very fast heartbeats. Tachycardias break down in to many       
categories, with the most significant being Atrial Fibrillation, or AF, and     
Ventricular Tachycardia, or VT. Both conditions require the precise diagnostic  
location and/or the subsequent destruction of the cells producing the           
arrhythmia. We develop, manufacture and commercialize our microcatheter-based   
systems for the diagnosis and treatment of these arrhythmias. Our               
microcatheters are being designed with a dual functionality to address the      
difficulty in and added costs associated with placing a diagnostic catheter     
into the heart to locate the arrhythmia, removing the catheter, replacing it    
with a catheter designed to treat the arrhythmia, finding the correct location  
again and then treating the site.                                               

Our microcatheters are about one-third to one-fourth the size of existing 
catheters. This smaller size allows our microcatheters to access sites within   
the wall of the heart using the venous system. The variable stiffness           
characteristic makes accessing the veins easier for VT diagnosis and treatment  
and allows them to conform to the surfaces of the heart's atrial wall for       
diagnosing and treating AF.                                                     

Our microcatheters are being developed as disposable, single use products 
that can be adapted to and used with virtually any electrophysiology system and 
most radio frequency generators available today.                                

To date, we have only received regulatory approvals in Europe to sell our 
ablation products.                                                              

Our Strategy                                                                    

Our strategy is to successfully diagnose and ultimately cure patients with
AF and VT using our microcatheter systems. This strategy is being accomplished  
by:                                                                             

.  developing state-of-the-art microcatheter systems, using unique          
  proprietary technology to provide disposable dual purpose microcatheters
with flexible coiled electrodes designed to interface with existing EP
lab equipment systems;                                                

.  proving the clinical utility of these products for the treatment of AF   
and VT; and                                                           

.  marketing these products throughout the world.                           

Our Operations                                                                  

Cardima, Inc. was incorporated in the State of Delaware in November 1992. 
Our principal executive offices are located at 47266 Benicia Street, Fremont,   
California 94538-7330 and our telephone number is 510/354-0300. As of January   
31, 1999, we had 76 full-time employees. Our operations are carried out in a    
44,000 square foot facility containing clean room production, research and      
development, and administrative offices.                                        

 The "Cardima" logo (used above and with our name) "Revelation," "Revelation
Tx," "Pathfinder," "Pathfinder mini," "Tracer," "Therastream," "Vueport,"       
"Venaport," "Naviport," "EP Select," and "Tx Select" are trademarks of Cardima, 
Inc. All other tradenames and trademarks appearing in this prospectus are the   
property of their respective holders.                                           

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RISK FACTORS

Investing in this company entails substantial risk. You should purchase   
shares only if you can afford a complete loss. You should carefully consider    
the risks of your investment in the "risk factors" section below, as well as    
other information contained in this prospectus, information incorporated by     
reference, and information which we file with the securities and exchange       
commission from time to time. The information in this prospectus is complete    
and accurate as of this date, but the information may change after the date on  
this prospectus.                                                                

We have sold a limited number of our microcatheter products and we will         
continue to incur substantial costs in bringing our microcatheter products to   
market.                                                                         

We have only sold a limited number of our microcatheter systems. In       
addition, we will continue to incur substantial losses into the foreseeable     
future as a result of research and product development, clinical trials,        
manufacturing, sales, marketing and other expenses as we seek to bring our      
microcatheters to market. Since our inception we have experienced losses and we 
expect to experience substantial net losses into the foreseeable future. Our    
net losses were approximately $16.2 million, $12.3 million and $7.8 million for 
1998, 1997 and 1996. As of December 31, 1998, our accumulated deficit was       
approximately $46.6 million. Our limited sales history makes it difficult to    
assess our future results. We cannot be certain that we will ever generate      
substantial revenue or achieve profitability. Our failure to generate           
substantial revenues would harm our business.                                   

We will need to raise capital in the future that could have a dilutive effect   
on your investment.                                                             

In order to commercialize our products, we will need to raise additional  
capital. One possibility for raising additional capital would be the public or  
private sale of our shares of stock. Any sale by us of additional shares of     
stock will dilute your percentage ownership in us.                              

Our failure to raise additional capital to develop and market our microcatheter 
systems will cause our business to suffer.                                      

We will need to raise additional capital in order to market our           
microcatheter systems. In addition, we may have to spend additional funds if    
unforeseen difficulties arise in the course of developing our products,         
performing clinical trials, obtaining necessary regulatory clearances and       
approvals or other aspects of our business. We cannot be certain that           
additional funding will be available to us when needed, if at all, or, if       
available, on terms attractive to us. Our inability to obtain sufficient funds  
may require us to delay, scale back or eliminate some or all of our research    
and product development programs, to limit the marketing of our microcatheter   
products, or to license to third parties the rights to commercialize products   
or technologies that we would otherwise try to develop and market ourselves.    
Our failure to raise this additional capital when needed would harm our         
business.                                                                       

Debt financing, if available, may involve restrictive covenants. We have  
financed our operations to date primarily through private sales of equity       
securities, proceeds from our initial public offering in June 1997, and loan-   
facilities. As of February 28, 1999, cash, cash equivalents, short-term         
investments and long-term restricted cash totaled $12.0 million. We believe     
that our existing cash, cash equivalents and short-term investments along with  
cash generated from the sales of our products and from financings, will be      
sufficient to fund our operating expenses, debt obligations and capital         
requirements through December 31, 1999.                                         

We rely on our contractual rights to access third-party data. Our inability to  
either access this data or the FDA's refusal to accept it in a filing, will     
delay the commercialization of our products and cause our business results to   
suffer.                                                                         

We often rely on our contractual rights to access data collected by others
in phases of our clinical trials. We depend on the continued performance by     
these third-parties parties of their contractual obligations to                 

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provide access and cooperate with us in completing filings with the FDA. We     
cannot be certain that the FDA will permit our reliance on these parties. If we 
are unable to rely on clinical data collected by others, or if these parties do 
not perform their contractual duties, we may be required to repeat clinical     
trials; which could significantly delay commercialization of our products,      
require us to spend more money on our clinical trials and cause our business    
results to suffer.                                                              

We cannot assure the safety or effectiveness of our products. We are in an      
early stage of our product development.                                         

  To date, we have completed two clinical trials and have received 510(k) pre-
market clearances from the FDA with respect to our Cardima Pathfinder and       
Pathfinder mini microcatheter systems for venous mapping of VT, and our         
Revelation microcatheter system for mapping and pacing of the atria. We also    
received FDA 510(k) clearance for the Vueport guiding catheter and for our      
Tracer mapping catheter. We are seeking 510(k) clearance for our Naviport       
deflectable tip guiding catheter. Our inability to timely obtain clearances for 
our other diagnostic products and guiding catheters under development would     
have a material adverse effect on our business, financial condition and results 
of operations.                                                                  

We are in the early stage of developing, testing and obtaining regulatory 
approval for our microcatheter systems designed for ablation of AF and VT. We   
are currently developing the Revelation Tx microcatheter system for ablation of 
AF and the Therastream microcatheter system for ablation of VT. We are required 
to obtain an Investigational Device Exemption, or IDE, from the FDA prior to    
conducting human clinical trials of our microcatheter systems for ablation. We  
completed the mapping phase of this feasibility study in August 1997 and the AF 
ablation feasibility study in December 1998. We received approval of an IDE     
supplement on December 1998 allowing us to expand the AF study. We filed an IDE 
to begin clinical testing of our Therastream microcatheter system for VT        
ablation in December 1998. We must complete these clinical trials and a pivotal 
trial for both AF and VT indications, if initiated, in order to gather data for 
the submission of a pre-market approval, or PMA, application to the FDA for our 
ablation products. We must receive PMA approval prior to marketing such         
products for ablation in the United States. Clinical trials of our              
microcatheter systems will require substantial financial and management         
resources and the completion of such trials will take several years. There can  
be no assurance that:                                                           

.  necessary IDEs will be granted by the FDA,                               

.  human clinical trials, if initiated, will be completed,                  

.  human clinical studies will validate the results of our pre-clinical     
studies, or                                                           

.  human clinical trials will demonstrate that our products are safe and    
effective.                                                            

  In addition, the clinical trials may identify significant technical or other
obstacles to be overcome prior to obtaining necessary regulatory approvals or   
market acceptance. Our failure to initiate and complete clinical trials,        
demonstrate product safety and clinical effectiveness, and obtain regulatory    
approval for the use of our microcatheter systems for the ablation of AF or VT  
would have a material adverse effect on our business, financial condition and   
results of operations.                                                          

Our microcatheter products and their related procedures are novel to the market 
and will require the special training of physicians. If the market does not     
accept our products and procedures, our revenues will decline.                  

Our microcatheter systems represent a novel approach to diagnosing and    
treating atrial fibrillation and ventricular tachycardia. Acceptance of our     
products and procedures by physicians, patients and health care payors will be  
necessary in order for us to be successful. If our products and procedures are  
not accepted by the market, our business could be harmed and our revenues would 
decline.                                                                        

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Our microcatheter products must be safe, effective and cost efficient in order  
for them to effectively compete against more established treatments. If we can  
not compete with these treatments, our revenues will decline.                   

The market for catheters to diagnose or treat AF and VT is highly         
competitive. Our microcatheter systems for the mapping and ablation of AF and   
VT are new technologies. Safety, cost efficiency and effectiveness are the      
primary competitive elements in our market. In addition, the length of time     
required for products to be developed and to receive regulatory and, in some    
cases, reimbursement approval are important competitive factors. Existing       
treatments with which we must compete include:                                  

.  drugs,                                                                   

.  external electrical cardioversion and defibrillation,                    

.  implantable defibrillators,                                              

.  purposeful destruction of the Atrio-Ventricular, or AV, node followed by 
implantation of a pacemaker, and                                      

.  open heart surgery and the "maze" procedure.                             

Physicians will not recommend the use of our microcatheter systems unless 
they can conclude that our systems provide a safe, effective and cost-efficient 
alternative to current technologies for the mapping and ablation of AF or VT.   
If our clinical data and other studies do not show that our products are safe   
and effective, our products will not effectively compete against establish      
treatments and our revenues will decline.                                       

None of our ablation products has received regulatory approval in the United    
States. Our failure to receive these approvals will harm our business and cause 
the value of your investment to decline.                                        

  None of our products currently being developed for the ablation of AF and VT
has received regulatory approval in the United States. If we can not gain U.S.  
regulatory approval, our business will be harmed. Even if our ablation products 
are successfully developed and the required regulatory approvals are obtained,  
we cannot be certain that our products and the associated procedures will       
ultimately gain any significant degree of market acceptance. Since our sole     
product focus is to design and market microcatheter systems to map and ablate   
AF and VT, our failure to successfully commercialize these systems would harm   
our business and cause the value of your investment to decline.                 

The mapping and ablation of AF in the left atrium may cause blood clots that    
could lead to a stroke. These adverse results from the use of our products      
would cause our revenues to decline.                                            

 We developed our Revelation and Revelation Tx microcatheter systems to both
map and ablate AF. The Revelation Tx microcatheter is capable of delivering     
radio frequency, or RF, energy in both the right and left atria to produce      
lesions. In general, the use of RF energy in the left atrium has the potential  
to create blood clots, which could travel through the body to the brain, and    
which could possibly cause a stroke. Because of this risk, physicians may not   
recommend this procedure, in which event the Revelation Tx would be unlikely to 
gain market acceptance or be successfully commercialized, which would cause our 
revenues to decline.                                                            

Our Therastream system for the treatment of VT is designed for use inside the   
vasculature of the heart wall. The use of this product may damage the arteries  
s of the heart and cause a heart attack.                                        

Our Therastream microcatheter system is being developed to ablate VT using
RF energy. Using RF energy could cause damage to the arteries of the heart and  
potentially lead to a myocardial infarction and even death. Because of this     
risk, physicians may not recommend this procedure, making it unlikely that      
Therastream would gain market acceptance. The failure of the Therastream system 
to gain market acceptance or be successfully commercialized would harm our      
business.                                                                       

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Significant increases in operating expenses in the future may adversely effect  
our operating results and financial condition.                                  

  We plan to significantly increase our operating expenses to expand our sales
and marketing operations and broaden our customer support capabilities as we    
attempt to commercialize our microcatheter products and fund greater levels of  
product development. Our operating expenses, which include sales and marketing, 
research and development and general and administrative expenses, are based on  
our expectations of future revenues and are relatively fixed in the short term. 
If revenues fall below our expectations, we will not be able to quickly reduce  
our spending in response, which would materially affect our operating results   
and financial condition.                                                        

Reuse of our single-use products could cause our revenues to decline.           

Although all of our microcatheter systems are labeled for single use only,
we are aware that some physicians are reusing these products. Reuse of our      
microcatheter systems could reduce revenues from product sales and could cause  
our revenues to decline.                                                        

We must obtain governmental approvals or clearances before we can sell our      
products.                                                                       

Our products are considered to be medical devices and will be subject to  
extensive regulation in the United States and internationally. These            
regulations are wide ranging and govern, among other things:                    

.  product design and development,                                          

.  product testing,                                                         

.  product labeling,                                                        

.  product storage,                                                         

.  premarket clearance and approval,                                        

.  advertising and promotion, and                                           

.  product sales and distribution.                                          

 Before we can market any of our products in the United States or Europe, we
must demonstrate that our products are safe and effective and obtain approval   
or clearance from applicable governmental authorities, which cannot be          
guaranteed. In the United States, we must obtain 510(k) premarket notification  
clearance or premarket approval, or PMA, from the FDA in order to market a      
product. We have received 510(k) premarket notification clearances for both the 
Cardima Pathfinder and Pathfinder mini microcatheter systems for mapping VT and 
for the Revelation microcatheter system for mapping AF. We believe that our     
other mapping products will be eligible for FDA 510(k) premarket notification.  
We have also submitted a 510(k) premarket notification application for the      
Naviport deflectable tip guiding catheter. Currently, the timing to receive     
510(k) clearance is approximately 120 days and PMA approval is 12 months, but   
timing can be uncertain and the process may be significantly longer. We cannot  
guarantee either the timing or receipt of approval or clearance. These products 
may require a PMA and extensive clinical data may be requested to support       
either 510(k) clearance or PMA approval.                                        

We will be required to seek PMA approval for our ablation products,       
including the Revelation Tx and the Therastream microcatheters for ablation.    
The process of obtaining PMA approval is much more expensive, lengthy and       
uncertain than the 510(k) premarket notification clearance process. In order to 
prepare a PMA application, we will be required to complete clinical trials to   
demonstrate the safety and effectiveness of these products. We submitted an IDE 
application for the Revelation microcatheter system for mapping and ablation of 
AF in January 1997. We completed a mapping study at Stanford University         
Hospital and Massachusetts General Hospital in September 1997. In addition, we  
received conditional IDE approval in January 1998 and full approval in March    
1998 for a feasibility clinical study for AF ablation using the Revelation Tx   
microcatheter system. We completed a 10-patient AF ablation feasibility study   
and submitted to the FDA a                                                      

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supplement to our IDE, requesting expansion of the study in November 1998. We   
filed an additional feasibility IDE application for the Therastream             
microcatheter system in December 1998. There can be no assurance that any       
clinical study that we propose will be permitted by the FDA, will be completed  
or, if completed, will provide data and information that supports PMA approval. 
We expect that a PMA application will not be submitted for at least one year,   
if at all. No assurance can be given that we will ever be able to obtain PMA    
approval for any of our ablation products. Our failure to complete clinical     
testing or to obtain timely PMA approval would have a material adverse effect   
on our business, financial condition and results of operations.                 

 Regulatory agencies may limit the indications for which any of our products
are approved or cleared. Further, the FDA may restrict or withdraw approval or  
clearance of a product if additional information becomes available to support   
such action. Delays in the approval or clearance process, limitation of our     
labeling claims or denial of our applications or notifications would cause our  
business to be materially and adversely affected.                               

Pre-clinical and clinical trials are inherently unpredictable. If we do not     
successfully conduct these trials, we may be unable to market our products and  
our revenues may decline.                                                       

Through pre-clinical studies and clinical trials, we must demonstrate that
our products are safe and effective for their indicated uses. Results from pre- 
clinical studies and early clinical trials may not allow us to predict results  
in later-stage testing. We cannot be certain that our future clinical trials    
will demonstrate the safety and effectiveness of any of our products or will    
result in approval to market our products. As a result, if we are unable to     
commence clinical trials as planned, complete clinical trials or demonstrate    
the safety and effectiveness of our products, our business will be harmed. We   
also cannot be certain that we can begin any future clinical trials or          
successfully complete these trials once started. In addition, we may never meet 
our development schedule for any of our products in development. Even if a      
product is successfully developed and clinically tested, we cannot be certain   
that it will be approved by the FDA on a timely basis or at all. If our         
products are not approved for commercial sales by the FDA, our business will be 
harmed.                                                                         

Delays in enrolling patients in our trials could increase our expenses and harm 
our business.                                                                   

The rate at which we may complete our pre-clinical and clinical trials is 
dependent upon the rate of patient enrollment. Patient enrollment depends on    
many factors, including the size of the patient population, the nature of the   
procedure, how close patients reside to clinical sites and the eligibility      
criteria for the study. Delays in planned patient enrollment may result in      
increased costs and delays, which could cause our business results to suffer.   

After obtaining approvals or clearances, we must continue to comply with        
applicable laws and regulations. If we do not comply, our business results may  
suffer.                                                                         

After approval or clearance, we will continue to be subject to extensive  
regulatory requirements. Our failure to comply with applicable regulatory       
requirements can result in enforcement actions by the FDA, including, but not   
limited to:                                                                     

.  fines,                                                                   

.  injunctions,                                                             

.  recall or seizure of products,                                           

.  withdrawal of marketing approvals or clearances,                         

.  refusal of the FDA to grant clearances or approvals, and                 

.  civil and criminal penalties.                                            

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  We are also required to demonstrate and maintain compliance with the Quality
System regulations, or QSR, for all of our products. The FDA enforces the QSR   
through periodic inspections, including a preapproval inspection for PMA        
products. The QSR relates to product testing and quality assurance, as well as  
the maintenance of records and documentation. If we or any third-party          
manufacturer of our products does not conform to the QSR and cannot be brought  
up to such a standard, we will be required to find alternative manufacturers    
that do conform. Identifying and qualifying alternative manufacturers may be a  
long and difficult process. We are also required to provide information to the  
FDA on deaths or serious injuries alleged to have been associated with the use  
of our medical devices, as well as product malfunctions that could contribute   
to death or serious injury. If we fail to comply with these applicable laws,    
our business results may suffer.                                                

If we do not comply with foreign regulatory requirements to market our products 
outside the United States, our business will be harmed.                         

Sales of medical devices outside the United States are subject to         
international regulatory requirements that vary from country to country. The    
time required for approval varies from country to country and may be longer or  
shorter than the time required in the United States. In order to market any of  
our devices in the member countries of the European Union, or the EU, we are    
required to obtain CE mark certification. CE mark certification is an           
international symbol of adherence to quality assurance standards and compliance 
with the European Medical Device Directives. We have received CE mark           
certification to sell the Cardima Pathfinder, Pathfinder mini, Revelation,      
Revelation Tx and Tracer for mapping in the EU. We also received approval to    
sell the Cardima Pathfinder, Pathfinder mini, Revelation, Revelation Tx, and    
Tracer in Japan and Australia, and to sell the Cardima Pathfinder, Tracer,      
Vueport and Naviport in Canada. The Company also received CE mark certification 
in August 1998 and December 1998 to sell the Revelation and Revelation Tx       
microcatheters, respectively, for ablation of AF in the EU. We intend to submit 
data in support of additional CE mark applications. There can be no assurance   
we will be successful in obtaining or maintaining the CE mark for these         
products, as the case may be. Failure to receive approval to affix the CE mark  
would prohibit us from selling these products in member countries of the EU,    
and would require significant delays in obtaining individual country approvals. 
No assurance can be given that such approvals will ever be obtained. If these   
approvals are not obtained, our business could be harmed.                       

Difficulties presented by international factors could negatively effect our     
business.                                                                       

A component of our strategy is to expand our international sales revenues.
We believe that we will face risks in doing business abroad that we do not face 
domestically. Among the international risks we believe are most likely to       
affect us are:                                                                  

.  export license requirements for our products,                            

.  exchange rate fluctuations or currency controls,                         

.  changes in the regulation of medical products by the European Union or   
other international regulatory agencies,                              

.  the difficulty in managing a direct sales force from abroad,             

.  the financial condition, expertise and performance of our international  
distributors and any future international distributors,               

.  domestic or international trade restrictions, or                         

.  changes in tariffs.                                                      

Any of these factors here could damage our business results.              

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We derive a significant portion of our revenues from the sale of microcatheters 
in the European Union. The adoption of the Euro presents uncertainties for our  
international business.                                                         

 In January 1999, the new "Euro" currency was introduced and adopted by some
European countries that are part of the European Monetary Union, or EMU.        
Beginning in 2003, all EMU countries are expected to be operating with the Euro 
as their single currency. A significant amount of uncertainty exists as to the  
effect the Euro will have on the marketplace generally. In particular as a      
significant amount of our sales revenue is derived from sales to EMU countries, 
these participating countries' adoption of a single currency may likely result  
in greater price transparency, making the EMU a more competitive environment    
for our microcatheter products. In addition, some of the rules and regulations  
relating to the governance of the currency have not yet been defined and        
finalized. As a result, companies operating in or conducting business in Europe 
will need to ensure that their financial and other software systems are capable 
of processing transactions and properly handling the Euro.                      

  We are currently assessing the effect the introduction of the Euro will have
on our internal accounting systems and the potential sales of our products. We  
will take appropriate corrective actions based on the results of such           
assessment. We have not yet determined the costs related to addressing this     
issue. This issue and its related costs could have a material adverse effect on 
our business, financial condition and results of operations.                    

We may be unable to successfully commercialize our microcatheter products as    
the industry for them is highly competitive.                                    

The market for catheters to map and/or ablate AF and VT is highly         
competitive. Several of our competitors are developing new approaches and       
products for these procedures. These approaches include mapping systems using   
contact mapping, single-point spatial mapping and non-contact, multi-site       
electrical mapping technologies, and ablation systems using RF, ultrasound,     
microwave, laser and cryoablation technologies. Other companies are also        
developing surgical procedures that could potentially be used by physicians to  
perform the open heart surgical maze procedure for the treatment of AF in a     
minimally invasive manner. If any of these new approaches or products prove to  
be safe, effective and cost effective, our products could be rendered           
noncompetitive or obsolete, which would cause our business results to suffer.   

Many of our competitors have an established presence in the field of      
interventional cardiology and electrophysiology. These competitors include      
Boston Scientific, C.R. Bard, Inc., Johnson & Johnson, through its Cordis       
division, St. Jude Medical, Inc., through its Daig division, and Medtronic,     
Inc. These competitors have substantially greater financial and other resources 
than we do, including larger research and development staffs and greater        
experience and capabilities in conducting research and development activities,  
testing products in clinical trials, obtaining regulatory approvals, and        
manufacturing, marketing and distributing products. In addition, other          
companies are developing proprietary systems for the diagnosis and treatment of 
cardiac arrhythmias. These companies include Biosense, Inc. a division of       
Johnson and Johnson, Cardiac Pathways, Inc. and Endocardial Solutions, Inc.     
Other companies develop, market and sell alternative approaches to the          
treatment of AF and VT. These companies include Guidant Corporation, Medtronic, 
Inc., and Ventritex, Inc., a subsidiary of St. Jude, Inc., manufacturers of     
implantable defibrillators. We cannot be certain that we will succeed in        
developing and marketing technologies and products that are safer, more         
clinically effective and cost-effective than the more established treatments or 
the new approaches and products being developed and marketed by our             
competitors. Furthermore, there can be no assurance that we will succeed in     
developing new technologies and products that are available prior to our        
competitors' products. Our failure to demonstrate the competitive advantages    
and achieve market acceptance of our products would harm our business.          

We license portions of our products technology. In particular, our              
microcatheter products rely on a license granted by Target Therapeutics. The    
termination of any of these licenses would harm our business.                   

  We rely on license agreements for some of our products technology. A license
from Target Therapeutics, Inc., a subsidiary of Boston Scientific Corporation,  
as the technological basis for our microcatheter systems for                    

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mapping and ablation. Under the Target license agreement, we have an exclusive  
license under specific issued United States patents. The exclusive license from 
Target covers the diagnosis and treatment of electrophysiological disorders in  
areas other than the central nervous system. In addition, we have obtained a    
non-exclusive license to use Target's technology, provided it has made a        
substantial improvement of such technology, for the diagnosis or treatment of   
diseases of the heart, other than by balloon angioplasty. The license will      
terminate upon the expiration or invalidation of all claims under the           
underlying patents. In addition, this license may terminate if we fail to       
comply with various commercialization, sublicensing, insurance, royalty,        
product liability, indemnification, non-competition and other obligations on    
us. The license can also be terminated by either party upon a material breach   
that remains uncured for thirty days or if either party ceases to be actively   
engaged in its present business for a period of twelve months. The loss of our  
exclusive rights to the Target-based microcatheter technology would harm our    
business.                                                                       

  We have also licensed a proprietary surface coating material used on certain
of our microcatheters. We cannot be certain that these licenses will continue   
to be available to us or will be available to us on reasonable terms. The loss  
of or inability to maintain any of these licenses could result in delays in     
commercial shipments until equivalent technology could be developed internally  
or identified, licensed and integrated. These delays would have a material      
adverse effect on our business, financial condition and results of operations.  

We may not be able to commercialize our products under development if they      
infringe existing patents or patents that have not yet issued.                  

We have conducted searches to determine whether our patent applications   
interfere with existing patents. Based upon these searches, we believe that our 
patent applications and products do not interfere with existing patents.        
However, we cannot be sure that relevant patents have not been issued that      
could block our ability to obtain patents or commercialize our products.        
Moreover, since U.S. patent applications are not a matter of public record, a   
patent application could currently be on file that would stand in our way of    
obtaining an issued patent. In addition, the United States patent laws were     
recently amended to exempt physicians, other health care professionals and      
affiliated entities from infringement liability for medical and surgical        
procedures performed on patients. The issuance of any potentially competing     
patent could harm our business.                                                 

  Although we have not received any letters from others threatening to enforce
intellectual property rights against us, we cannot be certain that we will not  
become subject to patent infringement claims or litigation, interference        
proceedings in the USPTO to determine the priority of inventions, or            
oppositions to patent grants in foreign countries. An adverse determination in  
litigation, interference or opposition proceedings could subject us to          
significant liabilities to third parties, require us to cease using such        
technology, or require us to license disputed rights from third parties.        
However, we are not certain that any licenses will be available to us, or if    
available, on commercially reasonable terms. Our inability to license any       
disputed technology could delay the commercialization of our products and harm  
our business. Under our license with Target, we are not indemnified against     
claims brought by third parties alleging infringement of patent rights.         
Consequently, we could bear the liability resulting from such claims. We cannot 
be certain that we will have the financial resources to protect and defend our  
intellectual property, as such defense is often costly and time-consuming. Our  
failure to protect our patent rights, trade secrets, know-how or other          
intellectual property would harm our business.                                  

If health care providers do not receive adequate reimbursement for procedures   
using our products, the market may not accept our products and our revenues may 
decline.                                                                        

U. S. health care providers, including hospitals and physicians, that     
purchase microcatheter products generally rely on third-party payors,           
principally federal Medicare, state Medicaid and private health insurance       
plans, to reimburse all or a part of the costs and fees associated with the     
procedures performed using our products. The success of our products will       
depend upon the ability of health care providers to obtain satisfactory         
reimbursement for medical procedures in which our microcatheter systems and the 
novel                                                                           

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procedures in which they are used. If these health care providers are unable to 
obtain reimbursement from third-party payors, the market may not accept our     
products and our revenues may decline.                                          

Third-party payors may deny reimbursement if they determine that (1) a    
prescribed device has not received appropriate regulatory clearances or         
approvals, (2) is not used in accordance with cost-effective treatment methods  
as determined by the payor, or (3) is experimental, unnecessary or              
inappropriate. If FDA clearance or approval is received, third-party            
reimbursement would also depend upon decisions by the United States Health Care 
Financing Administration for Medicare, as well as by individual health          
maintenance organizations, private insurers and other payors. Reimbursement     
systems in international markets vary significantly by country and by region    
within some countries, and reimbursement approvals may be obtained on a         
country-by-country basis. Many international markets have government managed    
health care systems that control reimbursement for new devices and procedures.  
In most markets, there are private insurance systems as well as government      
managed systems. There can be no assurance that (1) reimbursement for our       
products will be available domestically or internationally, (2) if available,   
that such reimbursement will be available in sufficient amounts in the United   
States or in international markets under either government or private           
reimbursement systems, or (3) that physicians will support and advocate         
reimbursement for procedures using our products. Failure by hospitals and other 
users of our products to obtain reimbursement from third-party payors or        
changes in government and private third-party payor policies toward             
reimbursement for procedures employing our products would have a material       
adverse effect on our business, financial condition and results of operations.  
Moreover, we are unable to predict what additional legislation or regulation,   
if any, relating to the heath care industry or third-party coverage and         
reimbursement may be enacted in the future, or what effect such legislation or  
regulation would have on our business.                                          

We cannot be certain that we will be able to manufacture our products in high   
volumes at commercially reasonable costs.                                       

  We currently manufacture our microcatheter systems in limited quantities for
United States and international sales and for pre-clinical and clinical trials. 
However, we have no experience manufacturing our products under development in  
the amounts necessary to achieve significant commercial sales. We currently     
believe that our manufacturing capacity will be sufficient through December     
1999. We expect that, if U.S. sales for the Pathfinder and Revelation           
microcatheter systems increase, or if we receive FDA clearance or approvals for 
other products, we will need to expend significant capital resources and        
develop manufacturing expertise to establish large-scale manufacturing          
capabilities. However, we could encounter problems related to:                  

.  capacity constraints,                                                    

.  production yields,                                                       

.  quality control, and                                                     

.  shortages of qualified personnel.                                        

 Such problems could affect our ability to adequately scale-up production of
our products and fulfill customer orders on a timely basis, which could harm    
our business.                                                                   

Our manufacturing facilities are subject to periodic inspection by        
regulatory authorities. Our operations must either undergo QSR compliance       
inspections conducted by the FDA or receive an FDA exemption from such          
compliance inspections in order for us to be permitted to produce products for  
sale in the United States. Our facilities and manufacturing processes are       
subject to inspections from time to time by the FDA, State of California and    
European Notified Bodies. We have demonstrated compliance with ISO 9001 (EN     
46001) quality standards, as well as compliance with 93/42/EEC, the Medical     
Device Directive. We are in compliance with procedures to produce products for  
sale in Europe. Any failure by Cardima to comply with QSR requirements or to    
maintain our compliance with ISO 9001 (EN 46001) standards and 93/42/EEC, the   
Medical Device Directive, will require us to take corrective actions, such as   
modification of our policies and procedures.                                    

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In addition, we may be required to cease all or part of our operations for some 
period of time until we can demonstrate that appropriate steps have been taken  
to comply with QSR or ISO 9001 (EN 46001) standards. There can be no assurance  
that we will be found in compliance with QSR by regulatory authorities, or that 
we will maintain compliance with ISO 9001 (EN 46001) standards in future        
audits. Our failure to comply with state or FDA QSR requirements, maintain      
compliance with ISO 9001 (EN 46001) standards, or develop our manufacturing     
capability in compliance with such standards, would have a material adverse     
effect on our business, financial condition and results of operations.          

If our sole-source suppliers are unable to meet our demands, our business       
results will suffer.                                                            

We purchase laminated tubing and hydrophilic coating, key components for  
some of our products, from sole, single or limited source suppliers. For some   
of these components, there are relatively few alternative sources of supply.    
Establishing additional or replacement suppliers for any of the numerous        
components used in our products, if required, may not be accomplished quickly   
and could involve significant additional costs. Any supply interruption from    
vendors or failure to obtain alternative vendors for any of the numerous        
components used to manufacture our products would limit our ability to          
manufacture our products. Any such limitation on our ability to manufacture our 
products would cause our business results to suffer.                            

We have limited sales and limited experience in the sale, marketing and         
distribution of our products. Our failure to establish an effective direct or   
indirect sales and marketing force will cause our revenues to decline.          

We have only limited experience marketing and selling our products in     
commercial quantities. Expanding our marketing and sales capability to          
adequately support sales in commercial quantities will require substantial      
effort and require significant management and financial resources. Our failure  
to establish an effective sales and marketing force will cause our revenues to  
decline. We have terminated several distribution arrangements in Europe. We are 
in the process of hiring, training and establishing a direct sales force in     
certain major European markets. Our ability to effectively operate a remote     
sales force will require additional resources, time and expense which could     
have a material adverse effect on our business, financial condition and results 
of operations. We are in the process of hiring a direct sales force in France   
and Germany. We currently have two salesmen in Germany. We can not be certain   
that we will be able to build a European direct sales force, that it will be    
cost-effective or that its efforts will be successful. Failure to establish an  
adequate sales force would harm our business.                                   

Currently, sales and marketing of the Cardima Pathfinder, Pathfinder mini,
Revelation, Revelation Tx and Tracer microcatheter systems is primarily         
conducted through a number of exclusive distributors in certain European        
countries and Japan. We have sold only a limited number of Pathfinder,          
Revelation, Revelation, Tx, and Tracer microcatheter systems through these      
distributors. Because we do not have written agreements with certain of our     
exclusive distributors, the terms of such arrangements, such as length of       
arrangements and minimum purchase obligations, are uncertain. In addition, the  
laws in certain international jurisdictions may make it difficult and costly    
for us to terminate such distribution arrangements without specific written     
termination terms. We cannot be certain that we will be able to enter into      
written distribution agreements with these distributors or that these           
distributors will be able to effectively market and sell our products in these  
markets. In addition, we can not assure you that we will be able to enter into  
additional agreements with desired distributors on a timely basis or at all, or 
that these distributors will devote adequate resources to selling our products. 
Our failure to establish and maintain appropriate distribution relationships    
would harm our business.                                                        

We are dependent upon our key personnel and will need to hire additional key    
personnel in the future.                                                        

Our ability to operate successfully depends in significant part upon the  
continued service of certain key scientific, technical, clinical, regulatory    
and managerial personnel, and our continuing ability to attract and retain      
additional highly qualified personnel in these areas. Competition for such      
personnel is intense, especially                                                

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in the San Francisco Bay Area. We cannot be certain that we can retain such     
personnel or that we can attract or retain other highly qualified scientific,   
technical, clinical, regulatory and managerial personnel in the future,         
including key sales and marketing personnel.                                    

We may face product liability claims related to the use or misuse of our        
products.                                                                       

We face an inherent business risk of product liability claims in the event
that the use or misuse of our products results in personal injury or death. We  
have not experienced any such claims to date, but we cannot be certain, in      
particular after commercial introduction of our products, that we will not      
experience losses due to product liability claims. We currently have general    
liability insurance with coverage in the amount of $1.0 million per occurrence, 
subject to a $2.0 million annual limitation. We have product liability          
insurance with coverage in the amount of $5.0 million per occurrence, subject   
to a $5.0 million annual limitation. We cannot be certain that coverage will    
continue to be available to us on reasonable terms, if at all. In addition,     
there can be no assurance that all of the activities encompassed within our     
business are or will be covered under the our policies. Although our            
microcatheter products are labeled for single use only, we are aware that some  
physicians are reusing such products. Moreover, despite labeling of our         
microcatheters for diagnostic use only, we believe that physicians are using    
such mapping microcatheters for ablation. Multiple use or "off-label" use of    
the our microcatheters could subject us to increased exposure to product        
liability claims, which could have a material adverse effect on the our         
business, financial condition and results of operations. We may require         
additional product liability coverage if we significantly expand                
commercialization of our products. Such additional coverage is expensive,       
difficult to obtain and may not be available in the future on acceptable terms, 
if at all. Any claims or series of claims against us, regardless of their merit 
or eventual outcome, could have a material adverse effect on our business,      
financial condition and results of operations.                                  

Trading in our shares could be subject to extreme price fluctuations which      
could adversely affect your investment.                                         

Prior to June 1997, there was no public market for our common stock. The  
market price of our common stock has fluctuated widely in the past and is       
likely to fluctuate in the future. The stock prices of medical device companies 
over the last few years have been volatile and difficult to predict.            

We do not intend to pay cash dividends on our stock.                            

  We have never paid cash dividends on our capital stock and do not anticipate
paying cash dividends in the foreseeable future. Instead, we intend to retain   
future earnings for reinvestment in our business. Our credit agreement requires 
the approval of our bank to declare or pay cash dividends.                      

Our operations may be negatively impacted by the Year 2000 issue.               

Many existing computer programs use only two digits to identify a year in 
the date field. These programs were designed and developed without considering  
the impact of the upcoming change in the century. If not corrected, many        
computer applications could fail or create erroneous results by or at the Year  
2000 (the "Year 2000 Issue"). We are in the process of performing an assessment 
of the potential impact of the Year 2000 Issue on our operations. We have       
evaluated our financial and accounting and inventory tracking systems and       
concluded that they are not materially affected by the Year 2000 Issue. The     
extent, if any, of the impact of the Year 2000 Issue on the other systems and   
equipment is unknown. We have performed a corporate-wide inventory of computer  
applications and we have remedied any issues. Our facilities manager has        
determined that there is no impact on building security and related equipment.  
There can be no assurance that all third parties will address the Year 2000     
Issue in a timely fashion, if at all. Any Year 2000 Issue compliance problems   
encountered by us, our business partners or our customers could have a material 
adverse effect on our business, operating results and financial condition.      

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We have utilized only internal resources to test and replace software for 
Year 2000 modifications. All of the replacement software were upgrades being    
purchased for other reasons. Therefore we have not incurred any additional      
costs in researching and resolving any Year 2000 issues.                        

We currently have no contingency plans in place in the event we do not    
complete all phases of the Year 2000 program. We plan to evaluate the status    
of completion in August 1999 and determine whether such a plan is necessary.    

CAUTIONARY NOTE ON FORWARD LOOKING STATEMENTS 

This prospectus and the documents referred to in this prospectus contain  
forwarding-looking statements that are based on current expectations and are    
subject to substantial risks and uncertainties. You can identify these          
forward-looking statements by words such as "anticipates," "expects,"           
"intends," "plans" "believes," "seeks," "estimates" and similar words. You      
should read statements that contain these words carefully because they: (1)     
discuss our future expectations; (2) contain projections of our future results  
of operations or financial condition; or (3) state other "forward-looking"      
information. These statements are not guarantees of future performance. There   
may be events in the future that we are not able to predict accurately or over  
which we have no control. The risk factors listed in this section, as well as   
any cautionary language in this prospectus, provide examples of risks,          
uncertainties and events that may cause our actual results to differ            
materially from the expectations we describe and may cause our stock price to   
fall.                                                                           

ISSUANCE OF COMMON STOCK TO SELLING STOCKHOLDERS  

On January 21, 1999 and February 5, 1999, we entered into agreements with 
certain investors (collectively the "Investors"), to sell an aggregate of       
7,500,000 shares of our Common Stock at a price of $2.00 per share, for an      
aggregate purchase price of approximately $15,000,000. These shares were        
issued to the Investors on those dates. In connection with this transaction,    
we also issued to the placement agent in our private placement 354,806 shares   
of our common stock and warrants to purchase 750,000 shares of our common       
stock at an exercise price of $2.20 per share.                                  

We issued all of the securities under an exemption from the registration  
requirements of the Securities Act of 1933. All of the securities are           
restricted securities until we register them under this prospectus.             

USE OF PROCEEDS 

We will not receive any proceeds from the sale of the securities by the   
selling stockholders in the offering.                                           

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SELLING STOCKHOLDERS

 The following table sets forth the number of Common shares owned by each of
the selling stockholders and the number of Warrants to purchase Common shares   
exercisable within 60 days of March 10, 1999 owned by each of the selling       
stockholders. Beneficial ownership is determined in accordance with the rules   
and regulations of the Commission and generally includes voting or investment   
power with respect to securities. Information with respect to beneficial        
ownership is based on information as of March 10, 1999 and assumes that there   
is outstanding an aggregate of 16,238,021 shares of Common Stock (not including 
treasury shares). No options have been issued to the Selling Stockholders named 
in this Prospectus. Other than the employees of Sunrise Securities, Corp. which 
served as placement agent in the private placement, none of the selling         
stockholders has had a material relationship with Cardima within the past three 
years other than as a result of the ownership of the shares or other securities 
of the Cardima. No estimate can be given as to the amount of shares that will   
be held by the selling stockholders after completion of this offering because   
the selling stockholders may offer all or some of the shares and because there  
currently are no agreements, arrangements or understandings with respect to the 
sale of any of the shares. The shares offered by this prospectus may be offered 
from time to time by the selling stockholders named below.                      

                                                                · Download Table

                                Number of    Number of               Number of 
                                  Common      Warrant                  Shares  
                                  Shares       Shares    Percent of  Registered
                               Beneficially Beneficially Outstanding  for Sale 
 Name of Selling Stockholder      Owned        Owned       Shares      Hereby  
 ---------------------------   ------------ ------------ ----------- ----------
                                                                               
Ruth Low.....................     50,000         --          *         50,000  
Porter Partners, L.P.........    150,000         --          *        150,000  
Talkot Crossover Fund........    200,000         --          1.2%     200,000  
Thomas Hutchinson............     12,500         --          *         12,500  
Nicholas DiFalco.............     12,500         --          *         12,500  
Amy Newmark..................    100,000         --          *        100,000  
Pequot Healthcare Fund,                                                        
 L.P.........................     75,000         --          *         75,000  
Pequot Scout Fund, L.P.......    425,000         --          2.6%     425,000  
Mark J. Sklar................      5,000         --          *          5,000  
Mitchel Sklar................      5,000         --          *          5,000  
Louis F. Bantle..............     25,000         --          *         25,000  
Bernice Brauser..............     50,000         --          *         50,000  
Leonid Feldman...............      5,000         --          *          5,000  
John W. Holley Grantor                                                         
 Trust.......................     62,500         --          *         62,500  
John W. Holley, John D.                                                        
 Holley Co-trustees,                                                           
 Barbara Holley Art VII                                                        
 Trust.......................     25,000         --          *         25,000  
Bruce N. Barron..............     10,000         --          *         10,000  
David Stone..................    125,000         --          *        125,000  
H. Russell Johnston..........     50,000         --          *         50,000  
Austost Anstalt Schaan.......    250,000         --          1.5%     250,000  
Balmore Funds, S.A...........    250,000         --          1.5%     250,000  
Branscombe Investments Ltd...    100,000         --          *        100,000  
Cradock Asset Management,                                                      
 Inc.........................    100,000         --          *        100,000  
EDJ Limited..................     50,000         --          *         50,000  
Michail Shapiro..............      7,500         --          *          7,500  
Triple Equity Investments,                                                     
 Ltd.........................     75,000         --          *         75,000  
Steve Abramow................     15,000         --          *         15,000  
Scott Flamm..................      5,000         --          *          5,000  
David Kalatsky...............      7,500         --          *          7,500  
Aries Domestic Fund, LP......    210,000         --          1.3%     210,000  
Aries Master Fund............    540,000         --          3.3%     540,000  
Emilio Bassini...............     50,000         --          *         50,000  

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                                                                · Download Table

                                 Number of    Number of               Number of 
                                   Common      Warrant                  Shares  
                                   Shares       Shares    Percent of  Registered
                                Beneficially Beneficially Outstanding  for Sale 
 Name of Selling Stockholder       Owned        Owned       Shares      Hereby  
 ---------------------------    ------------ ------------ ----------- ----------
                                                                                
Brown Simpson Strategic Growth                                                  
 Fund, L.P....................    190,000           --        1.2%     190,000  
Brown Simpson Strategic Growth                                                  
 Fund, Ltd....................    310,000           --        1.9%     310,000  
Canadian Imperial Holdings,                                                     
 Inc..........................    250,000           --        1.5%     250,000  
Curran Partners, L.P..........    100,000           --        *        100,000  
Alvin H. Einbender Trust......     50,000           --        *         50,000  
FK Investments, L.P...........     25,000           --        *         25,000  
Joy Henshel...................     10,000           --        *         10,000  
Jerry Heymann.................     38,000           --        *         38,000  
Malcolm Hoenlein..............     20,000           --        *         20,000  
Marc L. Hurwitz...............     50,000           --        *         50,000  
Eli Jacobson..................     20,000           --        *         20,000  
Jays Twelve, LLC..............    150,000           --        *        150,000  
Michael G. Jesselson 12/18/80                                                   
 Trust........................    150,000           --        *        150,000  
Ronald Kaufman................      5,000           --        *          5,000  
Neal Kozodoy..................     10,000           --        *         10,000  
Larry Miller..................    125,000           --        *        125,000  
Howard P. Milstein............    250,000           --        1.5%     250,000  
Ohr Somayach International....     20,000           --        *         20,000  
Steven M. Oliveira............     50,000           --        *         50,000  
Overdrive Capital                                                               
 Corporation..................     50,000           --        *         50,000  
Pharmaceutical/Medical                                                          
 Technology Fund, L.P.........    213,000           --        1.3%     213,000  
Radix Associates..............     50,000           --        *         50,000  
Richard Stone.................    103,920       75,825        *        129,745  
Strategic Healthcare                                                            
 Investment Fund Ltd..........     37,000           --        *         37,000  
Joseph Telushkin..............     12,000           --        *         12,000  
Jeffrey Thorp.................     21,000           --        *         21,000  
Elliot K. Wolk Family Limited                                                   
 Partnership..................     50,000           --        *         50,000  
Yad Avraham Institute.........     50,000           --        *         50,000  
Jay Schottenstein.............    100,000           --        *        100,000  
Edmund & Gloria Dunn J.T.C....     50,000           --        *         50,000  
Thomas J. Hudak...............     50,000           --        *         50,000  
Penn Footwear Co..............     50,000           --        *         50,000  
State Capital Partners........    250,000           --        1.5%     250,000  
Robert L. Swisher, Jr.........    100,000           --        *        100,000  
Merle Kovtun..................     12,500           --        *         12,500  
Barbara Wilson Holley and John                                                  
 W. Holley co-ttees Barbara                                                     
 Wilson Holley Revocable Trust                                                  
 dtd 7/31/96..................     12,500           --        *         12,500  
James Stramondo...............     35,000           --        *         35,000  
Kieran Nicholson..............     12,500           --        *         12,500  
Target Therapeutics, Inc......    681,000           --        4.2%     681,000  
HA Ventures...................     12,500           --        *         12,500  
Morton Seelenfreund...........     25,000           --        *         25,000  
Mark Halper...................     25,000           --        *         25,000  
Alan Spiegel IRA Rollover                                                       
 Account......................      1,000           --        *          1,000  
Michael DiPasquale............      5,000           --        *          5,000  
FM Multi-Strategy Investment                                                    
 Fund L.P.....................     25,000           --        *         25,000  
I. Michael Goodman............     15,000           --        *         15,000  
Gross Foundation..............    100,000           --        *        100,000  

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                                                                · Download Table

                                Number of    Number of               Number of 
                                  Common      Warrant                  Shares  
                                  Shares       Shares    Percent of  Registered
                               Beneficially Beneficially Outstanding  for Sale 
 Name of Selling Stockholder      Owned        Owned       Shares      Hereby  
 ---------------------------   ------------ ------------ ----------- ----------
                                                                               
George Karfunkle..............    100,000          --        *         100,000 
Jeffrey Leiderman.............     13,000          --        *          13,000 
Harold Levine.................     12,500          --        *          12,500 
First Hand Funds..............    250,000          --        1.5%      250,000 
John Gallagher................      3,200       4,500        *           7,700 
Preston Tsao..................          0      29,360        *          29,360 
Paul Scharfer.................    118,228     176,244        *         294,472 
Nathan Low....................    291,758           0        *         291,758 
Nathan Low Roth IRA...........          0     361,907        *         361,907 
Marc Seelenfreund.............          0      58,275        *          58,275 
Dwight Miller.................      6,000       9,001        *          15,001 
Derek Caldwell................      3,200       6,750        *           9,950 
Alan Swerdloff................          0       8,138        *           8,138 
Mart Baily....................          0       5,000        *           5,000 
Gary Shemano..................          0      10,000        *          10,000 
Michael Jacks.................          0       5,000        *           5,000 
Bret Van Leeuwen..............     25,000          --        *          25,000 
Stefan Shoup..................     12,500          --        *          12,500 
                                ---------     -------        ---     --------- 
  TOTAL:......................  7,854,806     750,000                8,604,806 

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

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PLAN OF DISTRIBUTION

The selling stockholders may sell the securities in whole or in part, from
time to time on the over-the-counter market at prices and on terms prevailing   
at the time of any such sale. Any such sale may be made in broker's             
transactions through broker-dealers acting as agents, in transactions directly  
with market makers or in privately negotiated transactions where no broker or   
other third party (other than the purchaser) is involved. The selling           
stockholders will pay selling commissions or brokerage fees, if any, with       
respect to the sale of the securities in amounts customary for the type of      
transaction effected. The selling stockholders will also pay all applicable     
transfer taxes and all fees and disbursements of counsel for the selling        
stockholders incurred in connection with the sale of shares. We will pay the    
costs relating to registration of the common stock to be sold under this        
prospectus.                                                                     

The selling stockholders have advised us that during such time as the     
selling stockholders may be engaged in the attempt to sell shares registered    
under this prospectus, that they will:                                          

(i) not engage in any stabilization activity in connection with any of the  
Company's securities;                                               

(ii) cause to be furnished to each person to whom securities included in    
this prospectus may be offered, and to each broker-dealer, if any,
  through whom securities are offered, such copies of this prospectus,
as supplemented or amended, as may be required by such person; and

(iii) not bid for or purchase any of our securities or any rights to        
   acquire our securities, or attempt to induce any person to purchase
   any of our securities or rights to acquire the Company's securities
other than as permitted under the Exchange Act.                 

 The selling stockholders, and any other persons who participate in the sale
of the shares, may be deemed to be "Underwriters" as defined in the Securities  
Act. Any commissions paid or any discounts or concessions allowed to any such   
persons, and any profits received on resale of the Securities, may be deemed to 
be underwriting discounts and commissions under the Securities Act.             

 With regard to the securities, we have agreed to maintain the effectiveness
of this registration statement until such time as the selling stockholders      
became eligible to resell the Securities pursuant to Rule 144 of the Securities 
Act.                                                                            

We have agreed to indemnify the selling stockholders against certain      
liabilities, including liabilities under the Securities Act and the Exchange    
Act.                                                                            

INDEMNIFICATION OF OFFICERS AND DIRECTORS 

Section 145 of the Delaware General Corporation Law authorizes a court to 
award, or a corporation's Board of Directors to grant, indemnity to directors   
and officers in terms sufficiently broad to permit such indemnification under   
certain circumstances for liabilities (including reimbursement for expenses     
incurred) arising under the Securities Act of 1933, as amended (the "Securities 
Act"). Our Amended and Restated Certificate of Incorporation and Bylaws provide 
for indemnification of its directors, officers, employees and other agents to   
the maximum extent permitted by law. In addition, we have entered into          
Indemnification Agreements with our officers and directors and maintain         
director and officer liability insurance. Insofar as indemnification for        
liabilities arising under the Securities Act may be permitted to directors,     
officers and controlling persons of the Company, we have been advised that in   
the opinion of the Commission, such indemnification is against public policy,   
as stated by the Commission, and is, therefore, unenforceable.                  

LEGAL MATTERS 

Certain legal matters with respect to the legality of the issuance of the 
common stock offered hereby will be passed upon for us by Wilson Sonsini        
Goodrich & Rosati, Professional Corporation, 650 Page Mill Road, Palo Alto,     
California 94304.                                                               

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EXPERTS 

Ernst & Young LLP, independent auditors, have audited our financial       
statements included in our Annual Report (Form 10-K) for the year ended         
December 31, 1998, as set forth in their report, which is incorporated in this  
prospectus by reference. Our financial statements are incorporated herein by    
reference in reliance on their report, given on their authority as experts in   
accounting and auditing.                                                        

WHERE YOU CAN FIND MORE INFORMATION 

 We are subject to the informational requirements of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), and in accordance with the        
Exchange Act, file Annual and quarterly reports, proxy statements, and other    
information with the Securities and Exchange Commission (the "Commission").     
This filed material can be inspected and copied at regional offices of the      
Commission located at Citicorp Center, 500 West Madison Street, Suite 1400,     
Chicago, Illinois 60661-2511 and 7 World Trade Center, Suite 1300, New York,    
New York 10048; and at the Public Reference Office of the Commission at 450     
Fifth Street, N.W., Washington, D.C. 20549. Copies of such material can be      
obtained from the Public Reference Section of the Commission, 450 Fifth Street, 
N.W., Washington, D.C. 20549 at prescribed rates. The Commission also maintains 
a World Wide Web site on the Internet at http://www.sec.gov that contains our   
reports, proxy and information statements and other information about us and    
other companies that file electronically with the Commission.                   

INFORMATION INCORPORATED BY REFERENCE 

The Commission allows us to "incorporate by reference" the information we 
file with them, which means that we can disclose important information to you   
by referring you to those documents. The information incorporated by reference  
is considered to be part of this prospectus, and later information filed with   
the Commission will update and supersede that information. We incorporate by    
reference the documents listed below and any future filings made with the SEC   
under Section 13a, 13(c), 14, or 15(d) of the Securities Exchange Act of 1934   
until our offering is completed.                                                

You can request a copy of any or all of the documents incorporated by     
reference, other than exhibits to the documents, by writing or telephoning us   
at the following address: Cardima, Inc., 47266 Benicia Street, Fremont,         
California 94538, telephone: (510) 354-0300, attention Ronald E. Bourquin,      
Chief Financial Officer.                                                        

1. Our Quarterly Report on Form 10-Q for the quarter ended March 31, 1999.  

2. Our Annual Report on Form 10-K for the year ended December 31, 1998.     

3. Our Quarterly Report on Form 10-Q for the quarter ended March 31, 1998,  
as amended.                                                           

4. Our Quarterly Report on Form 10-Q for the quarter ended June 30, 1998,   
as amended.                                                           

5. Our Quarterly Report on Form 10-Q for the quarter ended September 30,    
1998.                                                                 

6. The description of our Common Stock set forth in our Registration        
Statement on Form 8-A filed with the Commission on April 23, 1997,    
including any amendment thereto or report filed for the purpose of    
updating such description.                                            

7. Our Current Report on Form 8-K filed December 24, 1998.                  

8. Our Current Report on Form 8-K filed February 2, 1999.                   

9. Our Current Report on Form 8-K filed February 11, 1999.                  

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ADDITIONAL INFORMATION

This prospectus constitutes a part of a Registration Statement on Form S-3
(referred to, together with all amendments and exhibits, as the "Registration   
Statement") filed by the Cardima with the Securities and Exchange Commission    
(the "Commission") under the Securities Act. This prospectus does not contain   
all of the information set forth in the Registration Statement, certain parts   
of which are omitted in accordance with the rules and regulations of the        
Commission. For further information with respect to Cardima and the shares of   
Common Stock offered hereby, reference is hereby made to the Registration       
Statement. Statements contained herein concerning the provisions of any         
document are not necessarily complete, and each such statement is qualified in  
its entirety by reference to the copy of such document filed with the           
Commission.                                                                     

21

Dates Referenced Herein   and   Documents Incorporated By Reference

				Referenced-On Page
This 424B4 Filing		Date		First		Last			Other Filings
		4/23/97		20					S-1/A, 8-A12G
		3/31/98		20					10-K405, 10-Q, 10-Q/A
		6/30/98		20					10-Q/A, 10-Q
		9/30/98		20					10-Q
		12/24/98		20					8-K
		12/31/98		4		20			10-K405, 10-K405/A
		1/21/99		15
		1/31/99		3
		2/2/99		20					8-K
		2/5/99		15					8-K, SC 13G/A
		2/11/99		20					8-K
		2/28/99		4
		3/10/99		16
		3/31/99		20					10-Q
		6/11/99		1
Filed On / Filed As Of		6/29/99		1
		12/31/99		4					10-K405, 10-K405/A
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