<SUBMISSION>
<ACCESSION-NUMBER>0000351721-02-000012
<TYPE>DEF 14A
<PUBLIC-DOCUMENT-COUNT>1
<PERIOD>20020605
<FILING-DATE>20020419
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>ADVANCED NEUROMODULATION SYSTEMS INC
<CIK>0000351721
<ASSIGNED-SIC>3841
<IRS-NUMBER>751646002
<STATE-OF-INCORPORATION>TX
<FISCAL-YEAR-END>1231
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>DEF 14A
<ACT>34
<FILE-NUMBER>000-10521
<FILM-NUMBER>02615166
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>6501 WINDCREST DRIVE SUITE 100
<CITY>PLANO
<STATE>TX
<ZIP>75024
<PHONE>9723098000
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>6501 WINDCREST DRIVE SUITE 100
<CITY>PLANO
<STATE>TX
<ZIP>75024
</MAIL-ADDRESS>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>QUEST MEDICAL INC
<DATE-CHANGED>19920703
</FORMER-COMPANY>
</FILER>
<DOCUMENT>
<TYPE>DEF 14A
<SEQUENCE>1
<FILENAME>body.htm
<DESCRIPTION>DEFINITIVE PROXY STATEMENT
<TEXT>
<HTML>
<HEAD>
<TITLE>ADVANCED NEUROMODULATION SYSTEMS DEFINITIVE PROXY STATEMENT</TITLE>
</HEAD>
<BODY>
<P ALIGN=CENTER><B>SCHEDULE 14A<BR>(Rule 14a-1O1)<BR>INFORMATION REQUIRED IN
PROXY STATEMENT<BR>SCHEDULE 14A INFORMATION</B></P>
<P ALIGN=CENTER><B>Proxy Statement Pursuant to Section 14(a) of the Securities
<BR>Exchange Act of 1934</B></P>
<P>Filed by the Registrant [X]<BR>
Filed by a Party other than the Registrant [ &nbsp;&nbsp;]<BR>
Check the appropriate box:</P>
<P>[ &nbsp;&nbsp;] Preliminary Proxy Statement<BR> [ &nbsp;&nbsp;] Confidential,
For Use of the Commission Only (as permitted by Rule 14a-6(e)(2))<BR> [X]
Definitive Proxy Statement<BR> [ &nbsp;&nbsp;] Definitive Additional
Materials<BR> [ &nbsp;&nbsp;] Soliciting Material Pursuant to Rule 14a-l 1(c) or
Rule 14a-12</P>
<P ALIGN=CENTER><B>ADVANCED NEUROMODULATION SYSTEMS, INC.</B><BR>(Name of
Registrant as Specified in Its Charter)</P>
<P ALIGN=CENTER><B>BOARD OF DIRECTORS OF ADVANCED NEUROMODULATION SYSTEMS, INC.
</B><BR>(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
<P>
<HR>
<P>Payment of Filing Fee (Check the appropriate box):</P>
<P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[X] No fee required.</P>
<P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[ &nbsp;&nbsp;] Fee computed on table below per
Exchange Act Rules 14a&#150;6 (i) (1) and 0-11.</P>
<P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Title of each class of securities to which
transaction applies:</P>
<HR>
<P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Aggregate number of securities to which
transaction applies:</P>
<HR>
<P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Per unit price or other underlying value
of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount
on which the filing fee is calculated and state how it was determined):</P>
<HR>
<P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) Proposed maximum aggregate value of
transaction:</P>
<HR>
<P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) Total fee paid:</P>
<HR>
<P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[ &nbsp;&nbsp;] Fee paid previously with
preliminary materials:</P>
<HR>
<P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[ &nbsp;&nbsp;] Check box if any part of the
fee is offset as provided by Exchange Act Rule 0-11(a) (2) and identify the
filing for which the offsetting fee was paid previously. Identify the previous
filing by registration statement number, or the form or schedule and the date of
its filing.</P>
<P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Amount previously paid:</P>
<HR>
<P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Form, Schedule or Registration Statement
no.:</P>
<HR>
<P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Filing Party:</P>
<HR>
<P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) Date Filed:</P>
<HR>

<PAGE>
<P ALIGN=CENTER><B><U>Advanced Neuromodulation Systems, Inc.</U></B><BR>
6501 Windcrest Drive, Suite 100, Plano, Texas 75024</P>
<P></P>
<P>May 8, 2002</P>
<P></P>
<P></P>
<P></P>
<P>Dear Fellow Shareholder:</P>
<P>You are cordially invited to attend the Annual Meeting of Shareholders of
Advanced Neuromodulation Systems, Inc. at 6501 Windcrest Drive, Suite 100,
Plano, Texas on June 5, 2002, at 10:00 a.m. (CDT).</P>
<P>This Notice of Annual Meeting and Proxy Statement describes the business to
be transacted at the meeting and provides other information concerning ANS that
you should be aware of when you vote your shares.</P>
<P>The principal business of the Annual Meeting will be to re-elect our Board of
Directors and to consider and act upon other business that may properly come
before the meeting. As in prior years, we plan to review the status of our
business and answer any questions you may have. We will also conduct a tour of
our state-of-the-art facility after the close of the Annual Meeting.</P>
<P>It is important that your shares are represented at the Annual Meeting
whether or not you plan to attend. To ensure that you will be represented, we
ask you to sign, date and return the enclosed proxy card or proxy voting
instruction form as soon as possible. Return of your proxy does not deprive you
of your right to attend the Annual Meeting or to vote your shares in
person.</P>
<P>On behalf of the Board of Directors and all of ANS, I would like to sincerely
express our appreciation for your continued support and interest.</P>
<P></P>
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR>
<TD WIDTH=40%>&nbsp;</TD>
<TD WIDTH=60%>Sincerely,</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD></TR>
<TR>
<TD></TD>
<TD><U>/s/Christopher G. Chavez</U></TD></TR>
<TR>
<TD></TD>
<TD>Christopher G. Chavez</TD></TR>
<TR>
<TD></TD>
<TD>President and CEO</TD></TR></TABLE>
<P></P>
<HR>

<PAGE>
<P ALIGN=CENTER><U><B>NOTICE OF ANNUAL MEETING OF SHAREHOLDERS</B></U></P>
<P></P>
<P ALIGN=CENTER><B>Wednesday, June 5, 2002</B></P>
<P ALIGN=CENTER><B>10:00 a.m. (CDT)</B></P>
<P ALIGN=CENTER><B>6501 Windcrest Drive, Suite 100</B></P>
<P ALIGN=CENTER><B>Plano, Texas 75025</B></P>
<P></P><P></P><P></P>
<P>The purpose of our Annual Meeting is to:</P>
<P>1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Elect seven Directors for the ensuing year;
and</P>
<P>2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Consider and act upon such other business
as may properly come before the meeting or any adjournment(s) thereof.</P>
<P>The proxy statement and accompanying proxy cards are being sent to
shareholders on or about May 8, 2002.</P>
<P>You can vote at the Annual Meeting in person or by proxy if you were a
stockholder of record on May 1, 2002. The stock transfer books will not be
closed. Our Annual Report for the fiscal year ended December 31, 2001 is
enclosed. You may revoke your proxy at any time prior to its exercise at the
Annual Meeting.</P>
<P></P>
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR>
<TD WIDTH=40%>&nbsp;</TD>
<TD WIDTH=60%>By Order of the Board of Directors,</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD></TR>
<TR>
<TD></TD>
<TD><U>/s/F. Robert Merrill III</U></TD></TR>
<TR>
<TD></TD>
<TD>F. Robert Merrill III</TD></TR>
<TR>
<TD></TD>
<TD>Executive Vice President-Finance,<BR>Chief Financial Officer,<BR>
Treasurer and Secretary</TD></TR></TABLE>
<P>May 8, 2002</P>
<HR>

<PAGE>
<P ALIGN=CENTER><U><B>TABLE OF CONTENTS</B></U></P>
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR>
<TD WIDTH=80%>Questions and Answers</TD>
<TD WIDTH=20%>&nbsp;&nbsp;&nbsp;&nbsp;1</TD></TR>
<TR>
<TD>Security Ownership of Management and Principal Shareholders</TD>
<TD ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;5</TD></TR>
<TR>
<TD>Election of Directors</TD>
<TD ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;7</TD></TR>
<TR>
<TD>Meetings and Committees of the Board of Directors</TD>
<TD ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;9</TD></TR>
<TR>
<TD>Executive Officers</TD>
<TD ALIGN=LEFT>&nbsp;&nbsp;12</TD></TR>
<TR>
<TD>Compensation of Executive Officers</TD>
<TD ALIGN=LEFT>&nbsp;&nbsp;14</TD></TR>
<TR>
<TD>Employment Contracts</TD>
<TD ALIGN=LEFT>&nbsp;&nbsp;16</TD></TR>
<TR>
<TD>Compensation Committee Report</TD>
<TD ALIGN=LEFT>&nbsp;&nbsp;18</TD></TR>
<TR>
<TD>Performance Graph</TD>
<TD ALIGN=LEFT>&nbsp;&nbsp;20</TD></TR>
<TR>
<TD>Audit Committee Report</TD>
<TD ALIGN=LEFT>&nbsp;&nbsp;21</TD></TR>
<TR>
<TD>Other Information</TD>
<TD ALIGN=LEFT>&nbsp;&nbsp;23</TD></TR></TABLE>
<HR>

<PAGE>
<P ALIGN=CENTER><U><B>QUESTIONS AND ANSWERS</B></U></P>
<P><I>What am I voting for?</I></P>
<P>The Company is asking you to vote to elect seven directors for the ensuing
year. You will also be asked to consider and act upon such other business as may
properly come before the meeting or any adjournment(s) thereof.</P>
<P><I>When and where will the meeting be held?</I></P>
<P>Our meeting will be held on June 5, 2002. The meeting will begin at 10:00
a.m. (CDT) and will be held at our facility located at 6501 Windcrest Drive,
Suite 100, Plano, Texas 75024.</P>
<P><I>Who is entitled to vote?</I></P>
<P>Shareholders at the close of business on May 1, 2002 (the record date)
will be the only persons entitled to vote. On April 11, 2002, there were
9,138,890 shares of common stock outstanding and entitled to vote at the Annual
Meeting.</P>
<P><I>How do I cast my vote?</I></P>
<P>All shareholders may vote by mail by completing, dating, and
signing the enclosed proxy card. Please mail your proxy card in the enclosed
envelope, which requires no postage if mailed in the United States. Returning
your proxy does not deprive you of your right to attend the Annual Meeting or to
vote your shares in person. Proxies properly signed and received in time for the
meeting, will be voted as instructed.</P>
<P><I>How many votes do I have?</I></P>
<P>Each share of ANS common stock that you own entitles you to one vote.</P>
<P><I>What if I receive more than one proxy card?</I></P>
<P>You may have shares that are in more than one account or are registered
differently. You should sign and return all of the proxy cards to guarantee that
all of your shares are voted. If you would like to receive only one proxy card
in the future, please contact ANS&#146; transfer agent, Computershare Investor
Services LLC at (312) 588-4991.</P>
<P ALIGN=CENTER>Page 1</P>
<HR>

<PAGE>
<P><I>What if I return my proxy, but do not mark it to show my vote?</I></P>
<P>If you do not indicate how you want to vote but have returned a
signed and dated proxy card, it will be considered a vote FOR approval of each
proposal.</P>
<P><I>What if other items come up during the Annual Meeting?</I></P>
<P>When you return your signed and dated proxy, you give discretionary
authority to vote on your behalf to Hugh M. Morrison, Chairman of the Board and
Kenneth G. Hawari, General Counsel, on any other matters that come before the
meeting, if we did not have notice of the matter at least 45 days before we
mailed these proxy materials to you.</P>
<P><I>Can I change my vote?</I></P>
<P>At any time before the Annual Meeting on June 5, 2002, you can change your
vote by returning a completed and signed proxy that has a later date
than your original proxy. You can also change your vote by written revocation
addressed to the Secretary of the Company or by voting in person at the Annual
Meeting.</P>
<P><I>How do I vote if I decide to attend the Annual Meeting?</I></P>
<P>If you attend the Annual Meeting, you may request a ballot when you arrive.
If your shares are held in the name of your broker, bank or other nominee,
you need to bring an account statement or letter from the nominee indicating
that you were the beneficial owner of the shares on May 1, 2002, the record
date for voting.</P>
<P><I>What vote is required to approve the proposal?</I></P>
<P>Assuming the presence of a quorum, the seven director nominees who
receive the highest number of affirmative votes will be elected as directors.
Votes may be cast in favor of or withheld from a director nominee. Votes that
are withheld from a particular nominee will be excluded entirely from the votes
and will not affect the outcome of the vote. Under applicable rules, brokers who
hold shares in street name have the authority to vote on the election of
directors when they have not received instructions from beneficial owners.
Brokers who do not receive instructions are generally entitled to vote on the
election of directors.</P>
<P ALIGN=CENTER>Page 2</P>
<HR>

<PAGE>
<P>In the election of directors, shareholders are not entitled to cumulate their
votes or to vote for a greater number of persons than the number of nominees
named in the proxy statement. In all other matters, assuming the presence of a
quorum, an affirmative vote of a majority of the shares of common stock present
in person or represented by proxy is required to pass a proposal.</P>
<P><I>How are abstentions treated?</I></P>
<P>Any shareholder who is present at the meeting, either in person or by proxy,
but who abstains from voting, will still be counted for purposes of determining
whether a quorum exists. An abstention will not be counted as an affirmative or
negative vote in the election of the directors. With respect to all other
matters, an abstention would have the same effect as a vote against the
proposal. Our shareholders have no appraisal rights under Texas law with respect
to the proposals specified in the Notice. If you sign your proxy card but do not
specify how you want to vote on a proposal, then your shares will be voted FOR
that proposal.</P>
<P><I>What constitutes a quorum?</I></P>
<P>The presence at the Annual Meeting in person, or by proxy, of the holders of
a majority of the outstanding common stock constitutes a quorum. As of April 11,
2002, the holders of at least 4,569,446 shares of the common stock must be
represented at the meeting in person or by proxy to have a quorum. The exact
number of shares necessary for a quorum will be based upon the number of
outstanding shares on the record date, May 1, 2002. You will be considered part
of the quorum if you return a signed and dated proxy card or if you attend the
meeting. If a quorum is not present, in person or by proxy, the Annual Meeting
may be adjourned until a quorum is obtained. Votes withheld from any director
nominee will be counted in determining whether a quorum is reached. In the
election of directors, you are not entitled to cumulate your votes nor may you
vote for a greater number of persons than the number of nominees named in this
Proxy Statement.</P>
<P><I>Who pays to prepare and mail the proxies?</I></P>
<P>ANS will pay all of the costs associated with preparing, mailing and
soliciting the proxies. We will ask banks and brokers holding shares of the
Company's stock to forward copies of the proxy material to the beneficial owners
of ANS common stock and to obtain the authority to execute proxies. In return,
ANS will reimburse banks and brokers for their out-of-pocket expenses.</P>
<P>In addition to mailing proxy materials, our directors, officers and employees
may solicit proxies in person, by telephone, or otherwise.</P>
<P ALIGN=CENTER>Page 3</P>
<HR>

<PAGE>
<P><I>How do I submit a shareholder proposal for next year's Annual Meeting?</I>
</P>
<P>Your proposal will be included in the 2003 proxy statement if it is submitted
in accordance with the proxy rules of the Securities and Exchange Commission
(SEC), is a proposal that we would be required to include in the proxy statement
pursuant to SEC rules, and is received at our corporate office no later than
January 8, 2003. Under the SEC's rules, proposals of shareholders must conform
to certain requirements as to form and substance and may be omitted from the
proxy materials under certain circumstances.</P>
<P><I>Where can I find the voting results of the Annual Meeting?</I></P>
<P>We will announce the voting results at the meeting and will publish the
results in our quarterly report on Form 10-Q for the second quarter of 2002. We
will file that report with the SEC by mid-August of this year. You can get a
copy by contacting Marta Munson, Investor Relations, Advanced Neuromodulation
Systems, Inc., 6501 Windcrest Drive, Suite 100, Plano, Texas 75024 or by email
at m.munson@ans-medical.com, or by contacting the SEC at (800) SEC-0330 or
www.sec.gov.</P>
<P ALIGN=CENTER>Page 4</P>
<HR>

<PAGE>
<P ALIGN=CENTER><B><U>SECURITY OWNERSHIP OF MANAGEMENT AND PRINCIPAL
SHAREHOLDERS</U></B></P>
<P>The following table sets forth, as of April 11, 2002, the beneficial
ownership of each current director, each nominee for director, the Chief
Executive Officer and the four most highly compensated executive officers (the
"Named Executive Officers"), all executive officers and directors as a group,
and each shareholder known to management of the Company to own beneficially more
than 5% of the outstanding common stock.</P>
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR>
<TD WIDTH=40%><BR><B><U>Name and Address of Beneficial Owner</U></B></TD>
<TD WIDTH=35% ALIGN=CENTER><B><U>Amount and Nature of<BR>Beneficial Ownership
</U><SUP>(1)</SUP></B></TD>
<TD WIDTH=25% ALIGN=CENTER><BR><B><U>Percent of Class</U><SUP>(2)</SUP></B></TD>
</TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD></TR>
<TR>
<TD>T. Rowe Price Associates, Inc.<BR>100 East Pratt<BR>Baltimore, Maryland
 21202</TD>
<TD ALIGN=CENTER VALIGN=TOP>1,062,750<SUP> (3)</SUP></TD>
<TD ALIGN=CENTER VALIGN=TOP>11.63%</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD></TR>
<TR>
<TD>Brookside Capital Partners Fund, L.P.<BR>Two Copley Place<BR>
Boston, Massachusetts  02116</TD>
<TD ALIGN=CENTER VALIGN=TOP>650,500 <SUP>(4)</SUP></TD>
<TD ALIGN=CENTER VALIGN=TOP>7.12%</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD></TR>
<TR>
<TD>Strong Capital Management, Inc.<BR>One Hundred Heritage Reserve<BR>
Milwaukee, Wisconsin  53201</TD>
<TD ALIGN=CENTER VALIGN=TOP>517,005 <SUP>(5)</SUP></TD>
<TD ALIGN=CENTER VALIGN=TOP>5.66%</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD></TR>
<TR>
<TD>Anthony J. Varrichio<BR>5600 Tanner Trail<BR>Plano, Texas  75093</TD>
<TD ALIGN=CENTER VALIGN=TOP>410,537 <SUP>(6)</SUP></TD>
<TD ALIGN=CENTER VALIGN=TOP>4.49%</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD></TR>
<TR>
<TD>Christopher G. Chavez</TD>
<TD ALIGN=CENTER VALIGN=TOP>193,151 <SUP>(7)</SUP></TD>
<TD ALIGN=CENTER VALIGN=TOP>2.07%</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD></TR>
<TR>
<TD>Hugh M. Morrison</TD>
<TD ALIGN=CENTER VALIGN=TOP>42,000 <SUP>(8)</SUP></TD>
<TD ALIGN=CENTER VALIGN=TOP>*</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD></TR>
<TR>
<TD>Robert C. Eberhart, Ph.D.</TD>
<TD ALIGN=CENTER VALIGN=TOP>25,200 <SUP>(9)</SUP></TD>
<TD ALIGN=CENTER VALIGN=TOP>*</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD></TR>
<TR>
<TD>A. Ronald Lerner</TD>
<TD ALIGN=CENTER VALIGN=TOP>75,543 <SUP>(10)</SUP></TD>
<TD ALIGN=CENTER VALIGN=TOP>*</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD></TR>
<TR>
<TD>Richard D. Nikolaev</TD>
<TD ALIGN=CENTER VALIGN=TOP>43,092 <SUP>(11)</SUP></TD>
<TD ALIGN=CENTER VALIGN=TOP>*</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD></TR>
<TR>
<TD>Michael J. Torma, M.D.</TD>
<TD ALIGN=CENTER VALIGN=TOP>1,875 <SUP>(12)</SUP></TD>
<TD ALIGN=CENTER VALIGN=TOP>*</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD></TR>
<TR>
<TD>Joseph E. Laptewicz</TD>
<TD ALIGN=CENTER VALIGN=TOP>11,250 <SUP>(13)</SUP></TD>
<TD ALIGN=CENTER VALIGN=TOP>*</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD></TR>
<TR>
<TD>F. Robert Merrill III</TD>
<TD ALIGN=CENTER VALIGN=TOP>61,000 <SUP>(12)</SUP></TD>
<TD ALIGN=CENTER VALIGN=TOP>*</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD></TR>
<TR>
<TD>Scott F. Drees</TD>
<TD ALIGN=CENTER VALIGN=TOP>93,001 <SUP>(12)</SUP></TD>
<TD ALIGN=CENTER VALIGN=TOP>1.01%</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD></TR>
<TR>
<TD>John H. Erickson</TD>
<TD ALIGN=CENTER VALIGN=TOP>51,000 <SUP>(14)</SUP></TD>
<TD ALIGN=CENTER VALIGN=TOP>*</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD></TR>
<TR>
<TD>All directors and executive officers as a group, including those named above
(14 persons).</TD>
<TD ALIGN=CENTER VALIGN=TOP>1,179,247 <SUP>(15)</SUP></TD>
<TD ALIGN=CENTER VALIGN=TOP>12.11%</TD></TR></TABLE>
<P>---------------------------</P>
<P>*&nbsp;&nbsp;&nbsp;&nbsp;Less than 1.0%.</P>
<P ALIGN=CENTER>Page 5</P>
<HR>

<PAGE>
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR>
<TD WIDTH=7% VALIGN=TOP>(1)</TD>
<TD WIDTH=93%>Unless otherwise noted and subject to community property laws,
where applicable, the persons named in the table above have sole voting and
investment power with respect to all shares of common stock shown as
beneficially owned by them.</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>(2)</TD>
<TD>Shares not outstanding but deemed beneficially owned by virtue of the right
of a person or member of a group to acquire them within 60 days are treated as
outstanding only when determining the amount and percent owned by such person or
group.</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>(3)</TD>
<TD>Based on information obtained by the Company from Schedule 13G filed by T.
Rowe Price Associates, Inc. dated February 20, 2002. T. Rowe Price Associates,
Inc. is deemed to have beneficial ownership of 1,062,750 shares of the Company's
common stock as of December 31, 2001.</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>(4)</TD>
<TD>Based on information obtained by the Company from Schedule 13G filed by
Brookside Capital Partners Fund, L.P. dated February 14, 2002. Brookside Capital
Partners Fund, L.P. is deemed to have beneficial ownership of 650,500 shares of
the Company's common stock as of December 31, 2001.</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>(5)</TD>
<TD>Based on information obtained by the Company from Schedule 13G filed by
Strong Capital Management, Inc. dated February 13, 2002. Strong Capital
Management, Inc. is deemed to have beneficial ownership of 517,005 shares of the
Company's common stock as of December 31, 2001.</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>(6)</TD>
<TD>Includes 5,000 shares subject to options exercisable within 60 days.</TD>
</TR>
<TR>
<TD>&nbsp;</TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>(7)</TD>
<TD>Includes 190,251 shares subject to options exercisable within 60 days.</TD>
</TR>
<TR>
<TD>&nbsp;</TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>(8)</TD>
<TD>Includes 36,250 shares subject to options exercisable within 60 days.</TD>
</TR>
<TR>
<TD>&nbsp;</TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>(9)</TD>
<TD>Includes 6,250 shares subject to options exercisable within 60 days.</TD>
</TR>
<TR>
<TD>&nbsp;</TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>(10)</TD>
<TD>Includes 8,543 shares subject to options exercisable within 60 days.</TD>
</TR>
<TR>
<TD>&nbsp;</TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>(11)</TD>
<TD>Includes 18,542 shares subject to options exercisable within 60 days.</TD>
</TR>
<TR>
<TD>&nbsp;</TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>(12)</TD>
<TD>Consists entirely of shares subject to options exercisable within 60 days.
</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>(13)</TD>
<TD>Includes 9,250 shares subject to options exercisable within 60 days.</TD>
</TR>
<TR>
<TD>&nbsp;</TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>(14)</TD>
<TD>Includes 49,000 shares subject options exercisable within 60 days.</TD>
</TR>
<TR>
<TD>&nbsp;</TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>(15)</TD>
<TD>Includes 596,712 shares subject to options exercisable within 60 days.</TD>
</TR></TABLE>
<P ALIGN=CENTER>Page 6</P>
<HR>

<PAGE>
<P ALIGN=CENTER><B><U>ELECTION OF DIRECTORS</U></B></P>
<P>Seven directors are nominated for election at the Annual Meeting. Each
director will serve until the next annual meeting of shareholders or until his
successor shall be elected and shall qualify. Proxies in the accompanying form
will be voted for the seven nominees listed in the table that follows, except
where you specifically withhold voting authority.</P>
<P>All nominees are incumbent directors. If any of the nominees should become
unable to accept the election, or for good cause will not accept the election,
the person named in the proxy may vote for such other person or persons as may
be designated by the Board of Directors, or the Board of Directors can vote to
reduce the size of the Board. Each of the nominees named below has indicated his
willingness to accept election, and management has no reason to believe that any
of the nominees named below will be unable or unwilling to serve.</P>
<P>The nominees for directors of the Company are as follows:</P>
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR>
<TD WIDTH=35% VALIGN=BOTTOM><B><U>Name</U></B></TD>
<TD WIDTH=40%><B><U>Principal Occupation or Employment During the Past Five
Years</U></B></TD>
<TD WIDTH=10% ALIGN=CENTER VALIGN=BOTTOM><B><U>Age</U></B></TD>
<TD WIDTH=15% ALIGN=CENTER VALIGN=BOTTOM><B><U>Director of ANS Since</U></B>
</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>Hugh M. Morrison <SUP>(1)</SUP></TD>
<TD>President and Chief Executive Officer of Clean Acquisition, Inc. and Pilgrim
Cleaners, Inc. since March 1996; Chairman of the Board of the Company since
January 1998.</TD>
<TD ALIGN=CENTER VALIGN=TOP>55</TD>
<TD WIDTH=20% ALIGN=CENTER VALIGN=TOP>1983</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>Robert C. Eberhart, Ph.D. <SUP>(1,2)</SUP></TD>
<TD>Professor of Engineering in Surgery, University of Texas Southwestern
Medical Center, Dallas, Texas since September 1976; Adjunct Professor of
Biomedical Engineering, University of Texas at Arlington, Arlington, Texas since
September 2001; Chairman, Joint Program in Biomedical Engineering, University of
Texas Southwestern Medical Center, Dallas, Texas, and University of Texas at
Arlington, Arlington, Texas from September 1983 to December 1999.</TD>
<TD ALIGN=CENTER VALIGN=TOP>65</TD>
<TD ALIGN=CENTER VALIGN=TOP>1994</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>Michael J. Torma, M.D. <SUP>(1, 2)</SUP></TD>
<TD>Principal and Chief Executive Officer of Torma Executive Consult, LLC since
September 2001; Vice President-Technology Development of Biomedical Research
Foundation of Northwest Louisiana and Director of the Center for Biomedical
Technology Innovation (CBTI) from September 1996 to August 2001.</TD>
<TD ALIGN=CENTER VALIGN=TOP>59</TD>
<TD ALIGN=CENTER VALIGN=TOP>1994</TD></TR></TABLE>
<P ALIGN=CENTER>Page 7</P>
<HR>

<PAGE>
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR>
<TD WIDTH=35% VALIGN=BOTTOM><B><U>Name</U></B></TD>
<TD WIDTH=40%><B><U>Principal Occupation or Employment During the Past Five
Years</U></B></TD>
<TD WIDTH=10% ALIGN=CENTER VALIGN=BOTTOM><B><U>Age</U></B></TD>
<TD WIDTH=15% ALIGN=CENTER VALIGN=BOTTOM><B><U>Director of ANS Since</U></B>
</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>Richard D. Nikolaev <SUP>(3)</SUP></TD>
<TD>President and Chief Executive Officer, NIKOR Enterprises, Inc. since
November 1997; President and Chief Executive Officer of Wright Medical
Technology, Inc. from November 1995 to November 1997.</TD>
<TD ALIGN=CENTER VALIGN=TOP>63</TD>
<TD ALIGN=CENTER VALIGN=TOP>1996</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>Christopher G. Chavez</TD>
<TD>President, Chief Executive Officer and Director of the Company since April
1998; Vice President, Worldwide Marketing &amp; Strategic Planning, Eastman
Kodak Company, from April 1997 to November 1997; Vice President and General
Manager, Infection Prevention Business Unit of Johnson &amp; Johnson Medical,
Inc. (JJMI) from August 1995 to April 1997; Director of the Health Industry
Council since February 1999; Director of Medical Device Manufacturing
Association (MDMA) since May 2000; Director of Visiting Nurses Association of
North Texas since October 2000.</TD>
<TD ALIGN=CENTER VALIGN=TOP>46</TD>
<TD ALIGN=CENTER VALIGN=TOP>1998</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>Joseph E. Laptewicz <SUP>(3)</SUP></TD>
<TD>Chairman, Empi, Inc. since January 2001; Chairman and Chief Executive
Officer, Empi, Inc. from April 1999 to December 2000; President and Chief
Executive Officer, Empi, Inc. from October 1994 to March 1999; Director of
Angiodynamics, Inc., a subsidiary of E-Z-EM, Inc. since April 1997.</TD>
<TD ALIGN=CENTER VALIGN=TOP>53</TD>
<TD ALIGN=CENTER VALIGN=TOP>1998</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>A. Ronald Lerner <SUP>(3)</SUP></TD>
<TD>Independent Business Consultant and Investor since January 2000; Founder and
President, Trendalysis Securities from March 1991 to December 1999; Founder and
President, Cypress Asset Management, Inc. from March 1996 to June 1999.</TD>
<TD ALIGN=CENTER VALIGN=TOP>56</TD>
<TD ALIGN=CENTER VALIGN=TOP>1999</TD></TR></TABLE>
<P>----------------------------------------------------------------------------
</P>
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR>
<TD WIDTH=10%>(1)</TD>
<TD WIDTH=90%>Member of the Compensation Committee of the Board of Directors
</TD></TR>
<TR>
<TD>(2)</TD>
<TD>Member of the Stock Option Plan Committee of the Board of Directors</TD>
</TR>
<TR>
<TD>(3)</TD>
<TD>Member of the Audit Committee of the Board of Directors</TD></TR></TABLE>
<P ALIGN=CENTER><B><I>THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR<BR>THE
ELECTION OF ALL NOMINEES NAMED ABOVE</I></B></P>
<P ALIGN=CENTER>Page 8</P>
<HR>

<PAGE>
<P ALIGN=CENTER><B><U>MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS</U></B>
</P>
<P>During the year ended December 31, 2001, there were four meetings of the
Board of Directors. Each director attended at least 75% of the aggregate of (a)
the total number of meetings of the Board of Directors held during the period
for which he served as a director and (b) the total number of meetings held by
all committees of the Board of Directors on which he served. The Board has three
committees: Audit, Compensation, and Stock Option.</P>
<P>The Audit Committee consists of Mr. Laptewicz, Mr. Lerner and Mr. Nikolaev,
all of whom are independent outside directors. This committee acts as a liaison
between the Board of Directors and the independent auditors. The committee
reviews with the independent auditors the planning and scope of financial
statement audits, the results of those audits and the adequacy of internal
accounting controls. It also monitors other corporate and financial policies.
The Audit Committee held seven meetings during the year ended December 31, 2001.
</P>
<P>The Compensation Committee consists of Dr. Eberhart, Mr. Morrison, and Dr.
Torma, all of whom are independent outside directors. This committee establishes
executive compensation policies and makes recommendations to the Board of
Directors. The Compensation Committee held two meetings during the year ended
December 31, 2001.</P>
<P>The Stock Option Committee consists of Dr. Eberhart and Dr. Torma, both of
whom are independent outside directors. This committee is vested with full
authority to select participants, grant options, determine the number of shares
subject to each option, the exercise price of each option, and in general, to
make, administer and interpret such rules and regulations as it deems necessary
to administer the Company's Stock Option Plans. The Stock Option Committee held
two meetings during the year ended December 31, 2001.</P>
<P>Mr. Morrison, Chairman of the Board, receives an annual retainer of $69,630
and reimbursement of all expenses incurred in attending each Board of Directors'
meeting. Mr. Morrison does not receive any additional compensation for attending
Board of Directors' meetings or committee meetings. All other nonmanagement
directors receive an annual retainer of $10,000 assuming at least 75% board
meeting attendance, a $1,500 director's fee for each Board of Directors' meeting
attended, $500 for each committee meeting attended and reimbursement of all
expenses incurred in attending such meetings.</P>
<P ALIGN=CENTER>Page 9</P>
<HR>

<PAGE>
<P>Directors and clinical advisors of the Company may be granted nontransferable
stock options under certain of the Company's stock option plans. The option
price per share for stock options granted to directors and clinical advisors
cannot be less than the fair market value per share on the date the option is
granted. In addition, the exercise period for options cannot exceed six years
and each option vests ratably over a four-year period. During the year ended
December 31, 2001, the following directors were issued stock option grants on
April 3, 2001 at an exercise price of $10.625:</P>
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR>
<TD WIDTH=10%>&nbsp;</TD>
<TD WIDTH=90%>Robert C. Eberhart, Ph.D. - 2,500 shares</TD></TR>
<TR>
<TD>&nbsp;</TD>
<TD>Joseph E. Laptewicz - 2,500 shares</TD></TR>
<TR>
<TD>&nbsp;</TD>
<TD>A. Ronald Lerner - 2,500 shares</TD></TR>
<TR>
<TD>&nbsp;</TD>
<TD>Hugh M. Morrison - 2,500 shares</TD></TR>
<TR>
<TD>&nbsp;</TD>
<TD>Richard D. Nikolaev - 2,500 shares</TD></TR>
<TR>
<TD>&nbsp;</TD>
<TD>Michael J. Torma, M.D. - 2,500 shares</TD></TR></TABLE>
<P>During the year ended December 31, 2001, one director exercised stock
options. In December 2001, Michael J. Torma, M.D. exercised options to purchase
11,250 shares of common stock at an exercise price of $5.00 per share and 625
shares of common stock at an exercise price of $14.25 per share. The net value
of such securities to Dr. Torma (market value less exercise price) at the time
of exercise was approximately $298,330.</P>
<P><B><U>Independent Auditor</U></B></P>
<P>Our Board has, in accordance with the recommendation of the Audit Committee,
chosen the firm of Ernst &amp; Young LLP as our independent auditor for 2002.
Following is a summary of fees for the year ended December 31, 2001:</P>
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR>
<TD WIDTH=10%>&nbsp;</TD>
<TD WIDTH=90%><U>Audit Fees</U>&nbsp;&nbsp; The aggregate fees billed or
expected to be billed by Ernst &amp; Young LLP for the professional services
rendered for the audit of ANS' annual financial statements for the fiscal year
ended December 31, 2001, review of the Annual Report on Form 10-K for the fiscal
year ended December 31, 2001, and the reviews of the financial statements
included in ANS' quarterly reports on Form 10-Q for the first three quarters of
2001, were $138,000.</TD></TR>
</TABLE>
<P ALIGN=CENTER>Page 10</P>
<HR>

<PAGE>
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR>
<TD WIDTH=10%>&nbsp;</TD>
<TD WIDTH=90%><U>Audit Related Fees</U>&nbsp;&nbsp;The aggregate fees billed by
Ernst &amp; Young LLP for professional services rendered in connection with
certain Securities and Exchange registration statements and miscellaneous audit
related services were $14,000 for the fiscal year ended December 31,
2001.</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD></TR>
<TR>
<TD WIDTH=10%>&nbsp;</TD>
<TD WIDTH=90%><U>Financial Information System and Implementation
Fees</U>&nbsp;&nbsp; No fees were billed by Ernst &amp; Young LLP for
professional services rendered for information technology services relating to
financial information systems design and implementation for the fiscal year
ended December 31, 2001.</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD></TR>
<TR>
<TD WIDTH=10%>&nbsp;</TD>
<TD WIDTH=90%><U>All Other Fees</U>&nbsp;&nbsp; The aggregate fees billed by
Ernst &amp; Young LLP for the fiscal year ended December 31, 2001 for various
tax advisory and compliance services and preparation of federal and state tax
returns were $53,000.</TD></TR></TABLE>
<P>The Audit Committee has determined that the provision of the services
described above under the caption "All Other Fees" is compatible with
maintaining Ernst &amp; Young LLP's independence.</P>
<P ALIGN=CENTER>Page 11</P>
<HR>

<PAGE>
<P ALIGN=CENTER><B><U>EXECUTIVE OFFICERS</U></B></P>
<P>The executive officers of the Company are as follows:</P>
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR>
<TD WIDTH=20% ALIGN=CENTER><B><U>Name</U></B></TD>
<TD WIDTH=10% ALIGN=CENTER><B><U>Age</U></B></TD>
<TD WIDTH=45% ALIGN=CENTER><B><U>Position</U></B></TD>
<TD WIDTH=25% ALIGN=CENTER><B><U>Executive Officer Since</U></B></TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>Christopher G. Chavez</TD>
<TD ALIGN=CENTER VALIGN=TOP>46</TD>
<TD>President, Chief Executive Officer and Director</TD>
<TD ALIGN=CENTER VALIGN=TOP>1998</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>F. Robert Merrill III</TD>
<TD ALIGN=CENTER VALIGN=TOP>52</TD>
<TD>Executive Vice President - Finance; Chief Financial Officer; Treasurer and
Secretary</TD>
<TD ALIGN=CENTER VALIGN=TOP>1981</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>Scott F. Drees</TD>
<TD ALIGN=CENTER VALIGN=TOP>44</TD>
<TD>Executive Vice President - Sales and Marketing</TD>
<TD ALIGN=CENTER VALIGN=TOP>1996</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>Anthony J. Varrichio</TD>
<TD ALIGN=CENTER VALIGN=TOP>55</TD>
<TD>Executive Vice President and Chief Technology Officer, ANS; President,
Hi-tronics Designs, Inc.</TD>
<TD ALIGN=CENTER VALIGN=TOP>2001</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>Kenneth G. Hawari</TD>
<TD ALIGN=CENTER VALIGN=TOP>43</TD>
<TD>General Counsel and Executive Vice President - Corporate Development</TD>
<TD ALIGN=CENTER VALIGN=TOP>2002</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>James P. Calhoun</TD>
<TD ALIGN=CENTER VALIGN=TOP>52</TD>
<TD>Vice President - Human Resources</TD>
<TD ALIGN=CENTER VALIGN=TOP>1995</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>John H. Erickson</TD>
<TD ALIGN=CENTER VALIGN=TOP>53</TD>
<TD>Vice President - Research and Development</TD>
<TD ALIGN=CENTER VALIGN=TOP>1996</TD></TR>
<TR>
<TD>&nbsp;</TD><TD></TD><TD></TD><TD></TD></TR>
<TR>
<TD VALIGN=TOP>Stuart B. Johnson</TD>
<TD ALIGN=CENTER VALIGN=TOP>55</TD>
<TD>Vice President - Manufacturing</TD>
<TD ALIGN=CENTER VALIGN=TOP>1997</TD></TR></TABLE>
<P>Mr. Chavez has been President, Chief Executive Officer and Director of the
Company since April 1998. From April 1997 to November 1997, Mr. Chavez was Vice
President, Worldwide Marketing &amp; Strategic Planning of Eastman Kodak
Company. From January 1990 to April 1997, Mr. Chavez was employed by Johnson
&amp; Johnson Medical, Inc. where he held various positions, including Vice
President and General Manager of the Infection Prevention Business Unit from
August 1995 to April 1997; Director, International Marketing from June 1994 to
August 1995; and Director, New Business Development from January 1990 to May
1994.</P>
<P>Mr. Merrill has been Executive Vice President - Finance since March 1998,
Chief Financial Officer since April 1994, Secretary since February 1989, and
Treasurer since February 1981. From July 1995 to March 1998, Mr. Merrill was
Senior Vice President - Finance of the Company.</P>
<P ALIGN=CENTER>Page 12</P>
<HR>

<PAGE>
<P>Mr. Hawari has been General Counsel and Executive Vice President - Corporate
Development since February 2002. Prior to joining the Company, Mr. Hawari was a
partner in the Dallas-based law firm of Hughes &amp; Luce, LLP, where he served
as the head of the Corporate Section and as a member of the firm's Management
and Executive Committees. Mr. Hawari joined Hughes &amp; Luce in 1984.</P>
<P>Mr. Drees has been Executive Vice - President-Sales and Marketing of the
Company since March 1998. From April 1996 to March 1998, Mr. Drees was Vice
President - Sales and Marketing of the Company.</P>
<P>Mr. Varrichio has been Executive Vice President and Chief Technology Officer
of the Company and President of the Company's Hi-tronics Designs, Inc.
subsidiary since March 2002. From January 2001 to February 2002, Mr. Varrichio
was Executive Vice President of the Company and General Manager of the Company's
Hi-tronics Designs, Inc. subsidiary. Prior to ANS' acquisition of Hi-tronics
Designs, Inc. in January 2001, Mr. Varrichio served as President and Chairman of
the Board for Hi-tronics Designs, Inc., which he co-founded in 1987.</P>
<P>Mr. Calhoun has been Vice President - Human Resources of the Company since
April 1995.</P>
<P>Mr. Erickson has been Vice President - Research and Development of the
Company since September 1996.</P>
<P>Mr. Johnson has been Vice President - Manufacturing of the Company since June
1997 and was Director of Manufacturing of the Company from March 1997 to June
1997. From 1993 to 1997, Mr. Johnson was employed by Orthofix International NV
where he held various positions including Vice President of Corporate
Operations.</P>
<P ALIGN=CENTER>Page 13</P>
<HR>

<PAGE>
<P ALIGN=CENTER><B><U>COMPENSATION OF EXECUTIVE OFFICERS</U></B></P>
<P>The following tables set forth certain information regarding compensation of
the Named Executive Officers for the periods indicated.</P>
<P ALIGN=CENTER><B>Summary Compensation Table</B></P>
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=1>
<TR>
<TD WIDTH=16%>&nbsp;</TD>
<TD WIDTH=10%>&nbsp;</TD>
<TD ALIGN=CENTER COLSPAN=3>Annual Compensation</TD>
<TD ALIGN=CENTER COLSPAN=3>Long-Term Compensation</TD>
<TD WIDTH=12%>&nbsp;</TD>
</TR>
<TR>
<TD WIDTH=16%>&nbsp;</TD>
<TD WIDTH=10%>&nbsp;</TD>
<TD WIDTH=13%>&nbsp;</TD>
<TD WIDTH=13%>&nbsp;</TD>
<TD WIDTH=7%>&nbsp;</TD>
<TD ALIGN=CENTER COLSPAN=2>Awards</TD>
<TD ALIGN=CENTER>Payouts</TD>
<TD WIDTH=12%>&nbsp;</TD></TR>
<TR>
<TD WIDTH=16% VALIGN=BOTTOM>Name and Principal Postion</TD>
<TD WIDTH=10% ALIGN=CENTER VALIGN=BOTTOM>Year</TD>
<TD WIDTH=13% ALIGN=CENTER VALIGN=BOTTOM>Salary<BR>($)</TD>
<TD WIDTH=13% ALIGN=CENTER VALIGN=BOTTOM>Bonus<BR>($)</TD>
<TD WIDTH=7% ALIGN=CENTER VALIGN=BOTTOM>Other Annual
Compen-<BR>sation<SUP>(1)</SUP><BR>($) </TD>
<TD WIDTH=14% ALIGN=CENTER VALIGN=BOTTOM>Restricted Stock<BR>Awards(s)<BR>($)
</TD>
<TD WIDTH=10% ALIGN=CENTER VALIGN=BOTTOM>Securities Underlying Options/SARs<BR>
(#)</TD>
<TD WIDTH=5% ALIGN=CENTER VALIGN=BOTTOM>LTIP Payouts<BR>($)</TD>
<TD WIDTH=12% ALIGN=CENTER VALIGN=BOTTOM>All Other<BR>Compen-<BR>sation<SUP>(2)
</SUP>($)</TD>
</TR>
<TR>
<TD WIDTH=17% VALIGN=TOP>Christopher G. Chavez (C.E.O.)</TD>
<TD WIDTH=10% ALIGN=CENTER>2001<BR>2000<BR>1999</TD>
<TD WIDTH=14% ALIGN=CENTER>$229,231<BR>$218,300<BR>$209,023</TD>
<TD WIDTH=14% ALIGN=CENTER>$138,300<BR>$100,410<BR>$&nbsp;&nbsp;95,409</TD>
<TD WIDTH=7% ALIGN=CENTER>---<BR>---<BR>---</TD>
<TD WIDTH=12% ALIGN=CENTER>---<BR>---<BR>---</TD>
<TD WIDTH=10% ALIGN=CENTER>25,000<BR>43,000<BR>25,000</TD>
<TD WIDTH=5% ALIGN=CENTER>---<BR>---<BR>---</TD>
<TD WIDTH=12% ALIGN=CENTER>$&nbsp;&nbsp;5,250<BR>$&nbsp;&nbsp;5,250<BR>
$&nbsp;&nbsp;5,000</TD></TR>
<TR>
<TD VALIGN=TOP>Scott F. Drees (Executive Vice President)</TD>
<TD ALIGN=CENTER>2001<BR>2000<BR>1999</TD>
<TD ALIGN=CENTER>$166,177<BR>$157,626<BR>$150,529</TD>
<TD ALIGN=CENTER>$&nbsp;&nbsp;50,130<BR>$&nbsp;&nbsp;36,390<BR>
$&nbsp;&nbsp;34,586</TD>
<TD ALIGN=CENTER>---<BR>---<BR>---</TD>
<TD ALIGN=CENTER>---<BR>---<BR>---</TD>
<TD ALIGN=CENTER>10,000<BR>17,000<BR>10,000</TD>
<TD ALIGN=CENTER>---<BR>---<BR>---</TD>
<TD ALIGN=CENTER>$&nbsp;&nbsp;5,250<BR>$&nbsp;&nbsp;5,250<BR>$&nbsp;&nbsp;5,000
</TD></TR>
<TR>
<TD VALIGN=TOP>F. Robert Merrill III (C.F.O.)</TD>
<TD ALIGN=CENTER>2001<BR>2000<BR>1999</TD>
<TD ALIGN=CENTER>$138,683<BR>$132,067<BR>$125,612</TD>
<TD ALIGN=CENTER>$&nbsp;&nbsp;41,835<BR>$&nbsp;&nbsp;30,375<BR>
$&nbsp;&nbsp;28,861</TD>
<TD ALIGN=CENTER>---<BR>---<BR>---</TD>
<TD ALIGN=CENTER>---<BR>---<BR>---</TD>
<TD ALIGN=CENTER>10,000<BR>17,000<BR>10,000</TD>
<TD ALIGN=CENTER>---<BR>---<BR>---</TD>
<TD ALIGN=CENTER>$&nbsp;&nbsp;5,072<BR>$&nbsp;&nbsp;4,981<BR>$&nbsp;&nbsp;4,676
</TD></TR>
<TR>
<TD VALIGN=TOP>Anthony J. Varrichio (Executive Vice President)</TD>
<TD ALIGN=CENTER>2001<BR>2000<BR>1999</TD>
<TD ALIGN=CENTER>$150,000<BR>$280,122<BR>$263,035</TD>
<TD ALIGN=CENTER>$&nbsp;&nbsp;45,000<BR>$&nbsp;&nbsp;72,000<BR>$&nbsp;&nbsp;
58,000</TD>
<TD ALIGN=CENTER>---<BR>---<BR>---</TD>
<TD ALIGN=CENTER>---<BR>---<BR>---</TD>
<TD ALIGN=CENTER>20,000<BR>---<BR>21,111</TD>
<TD ALIGN=CENTER>---<BR>---<BR>---</TD>
<TD ALIGN=CENTER>$&nbsp;&nbsp;8,073<BR>$10,500<BR>$10,000
</TD></TR>
<TR>
<TD VALIGN=TOP>John H. Erickson (Vice President)</TD>
<TD ALIGN=CENTER>2001<BR>2000<BR>1999</TD>
<TD ALIGN=CENTER>$122,619<BR>$116,163<BR>$107,981</TD>
<TD ALIGN=CENTER>$&nbsp;&nbsp;36,990<BR>$&nbsp;&nbsp;26,852<BR>
$&nbsp;&nbsp;24,806</TD>
<TD ALIGN=CENTER>---<BR>---<BR>---</TD>
<TD ALIGN=CENTER>---<BR>---<BR>---</TD>
<TD ALIGN=CENTER>10,000<BR>17,000<BR>20,000</TD>
<TD ALIGN=CENTER>---<BR>---<BR>---</TD>
<TD ALIGN=CENTER>$&nbsp;&nbsp;4,646<BR>$&nbsp;&nbsp;4,491<BR>$&nbsp;&nbsp;3,974
</TD></TR>
</TABLE>
<P>(1)&nbsp;&nbsp;&nbsp;None of the Named Executive Officers received
personal benefits, securities or property in excess of the lesser of $50,000 or
10 percent of such individual's reported salary and bonus.</P>
<P>(2)&nbsp;&nbsp;&nbsp;Reflects matching employer contributions under the
Company's Employees Savings Plan 401(k).</P>
<P ALIGN=CENTER>Page 14</P>
<HR>

<PAGE>
<P ALIGN=CENTER>Option/SAR Grants in Last Fiscal Year (Individual Grants)</P>
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=1>
<TR>
<TD WIDTH=16% ALIGN=CENTER VALIGN=BOTTOM>Name</TD>
<TD WIDTH=15% ALIGN=CENTER VALIGN=BOTTOM>Number of Securities Underlying
Options/SARs Granted (#)</TD>
<TD WIDTH=15% ALIGN=CENTER VALIGN=BOTTOM>Percent of Total Options/SARs Granted
to Employees In Fiscal Year</TD>
<TD WIDTH=15% ALIGN=CENTER VALIGN=BOTTOM>Exercise or Base Price ($/Sh)</TD>
<TD WIDTH=15% ALIGN=CENTER VALIGN=BOTTOM>Expiration Date</TD>
<TD WIDTH=24% ALIGN=CENTER VALIGN=BOTTOM COLSPAN=2>Potential Realizable Value at
Assumed Annual Rates of Stock Price Appreciation<BR><U>for Option Term</U><BR>
<BR>&nbsp;&nbsp;5%&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;10%</TD>
</TR>
<TR>
<TD>Christopher G. Chavez</TD>
<TD WIDTH=16% ALIGN=CENTER>25,000</TD>
<TD WIDTH=15% ALIGN=CENTER>6.05%</TD>
<TD WIDTH=15% ALIGN=CENTER>$10.625</TD>
<TD WIDTH=15% ALIGN=CENTER>04/03/11</TD>
<TD WIDTH=12% ALIGN=CENTER>$167,050</TD>
<TD WIDTH=12% ALIGN=CENTER>$423,338</TD></TR>
<TR>
<TD>Scott F. Drees</TD>
<TD ALIGN=CENTER>10,000</TD>
<TD ALIGN=CENTER>2.42%</TD>
<TD ALIGN=CENTER>$10.625</TD>
<TD ALIGN=CENTER>04/03/11</TD>
<TD ALIGN=CENTER>$&nbsp;&nbsp;66,820</TD>
<TD ALIGN=CENTER>$169,335</TD></TR>
<TR>
<TD>F. Robert Merrill III</TD>
<TD ALIGN=CENTER>10,000</TD>
<TD ALIGN=CENTER>2.42%</TD>
<TD ALIGN=CENTER>$10.625</TD>
<TD ALIGN=CENTER>04/03/11</TD>
<TD ALIGN=CENTER>$&nbsp;&nbsp;66,820</TD>
<TD ALIGN=CENTER>$169,335</TD></TR>
<TR>
<TD>Anthony J. Varrichio</TD>
<TD ALIGN=CENTER>20,000</TD>
<TD ALIGN=CENTER>4.84%</TD>
<TD ALIGN=CENTER>$20.375</TD>
<TD ALIGN=CENTER>01/02/11</TD>
<TD ALIGN=CENTER>$256,275</TD>
<TD ALIGN=CENTER>$649,450</TD></TR>
<TR>
<TD>John E. Erickson</TD>
<TD ALIGN=CENTER>10,000</TD>
<TD ALIGN=CENTER>2.42%</TD>
<TD ALIGN=CENTER>$10.625</TD>
<TD ALIGN=CENTER>04/03/11</TD>
<TD ALIGN=CENTER>$&nbsp;&nbsp;66,820</TD>
<TD ALIGN=CENTER>$169,335</TD></TR>
</TABLE>
<P ALIGN=CENTER><B><U>Aggregated Option/SAR Exercises in Last Fiscal Year<BR>
And Fiscal Year End Option/SAR Values</U></B></P>
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=1>
<TR>
<TD WIDTH=16% ALIGN=CENTER VALIGN=BOTTOM>Name</TD>
<TD WIDTH=16% ALIGN=CENTER VALIGN=BOTTOM>Shares Acquired on Exercise<BR>(#)</TD>
<TD WIDTH=16% ALIGN=CENTER VALIGN=BOTTOM>Value Realized<BR>($)</TD>
<TD ALIGN=CENTER VALIGN=BOTTOM COLSPAN=2>Number of Securities Underlying
Unexercised<BR><U>Options/SARs at
FY-end(#)</U><BR><BR>Exercisable&nbsp;&nbsp;&nbsp;&nbsp;Unexercisable</TD>
<TD ALIGN=CENTER VALIGN=BOTTOM COLSPAN=2>Value of Unexercised In-the-Money
Options/SARs<BR><U>at FY-end ($)</U>
<SUP>(1)</SUP><BR><BR>Exercisable&nbsp;&nbsp;&nbsp;&nbsp;Unexercisable</TD>
</TR>
<TR>
<TD>Christopher G. Chavez</TD>
<TD ALIGN=CENTER>35,000</TD>
<TD ALIGN=CENTER>$867,788</TD>
<TD WIDTH=13% ALIGN=CENTER>173,250</TD>
<TD WIDTH=13% ALIGN=CENTER>69,750</TD>
<TD WIDTH=13% ALIGN=CENTER>$5,116,391</TD>
<TD WIDTH=13% ALIGN=CENTER>$1,636,672</TD></TR>
<TR>
<TD>F. Robert Merrill III</TD>
<TD ALIGN=CENTER>10,850</TD>
<TD ALIGN=CENTER>$303,893</TD>
<TD WIDTH=13% ALIGN=CENTER>&nbsp;&nbsp;54,251</TD>
<TD WIDTH=13% ALIGN=CENTER>27,749</TD>
<TD WIDTH=13% ALIGN=CENTER>$1,591,911</TD>
<TD WIDTH=13% ALIGN=CENTER>$&nbsp;&nbsp;651,902</TD></TR>
<TR>
<TD>Scott F. Drees</TD>
<TD ALIGN=CENTER>20,000</TD>
<TD ALIGN=CENTER>$544,986</TD>
<TD WIDTH=13% ALIGN=CENTER>&nbsp;&nbsp;96,250</TD>
<TD WIDTH=13% ALIGN=CENTER>27,750</TD>
<TD WIDTH=13% ALIGN=CENTER>$2,862,391</TD>
<TD WIDTH=13% ALIGN=CENTER>$&nbsp;&nbsp;651,922</TD></TR>
<TR>
<TD>Anthony J. Varrichio</TD>
<TD ALIGN=CENTER>---</TD>
<TD ALIGN=CENTER>---</TD>
<TD WIDTH=13% ALIGN=CENTER>---</TD>
<TD WIDTH=13% ALIGN=CENTER>20,000</TD>
<TD WIDTH=13% ALIGN=CENTER>---</TD>
<TD WIDTH=13% ALIGN=CENTER>$&nbsp;&nbsp;297,500</TD></TR>
<TR>
<TD>John H. Erickson</TD>
<TD ALIGN=CENTER>12,000</TD>
<TD ALIGN=CENTER>$329,746</TD>
<TD WIDTH=13% ALIGN=CENTER>&nbsp;&nbsp;37,250</TD>
<TD WIDTH=13% ALIGN=CENTER>37,750</TD>
<TD WIDTH=13% ALIGN=CENTER>$1,069,281</TD>
<TD WIDTH=13% ALIGN=CENTER>$&nbsp;&nbsp;945,594</TD></TR></TABLE>
<P>(1)&nbsp;&nbsp;&nbsp;Represents the difference between the closing market
price of the common stock on the Nasdaq National Market System on December 31,
2001 and the exercise price of the options.</P>
<P ALIGN=CENTER>Page 15</P>
<HR>

<PAGE>
<P ALIGN=CENTER><B><U>EMPLOYMENT CONTRACTS</U></B></P>
<P><U>Change-in-Control Arrangements</U>&nbsp; We have entered into
change-in-control agreements with each of the named executive officers, with the
exception of Anthony J. Varrichio. These agreements generally provide that if
within two years from the date of a "change in control" of the Company (as
defined below), the employment of the executive is terminated without cause, or
in the event that the executive terminates his or her employment with ANS based
on a change in or diminishment of his or her responsibilities, or a reduction in
salary, such executive will be entitled to severance pay as provided for in his
or her agreement. Mr. Chavez's agreement only requires a change-in-control to
trigger his right to severance compensation. The severance pay for Mr. Chavez
would be an amount equal to three times his annual salary and bonus
compensation; for Mr. Merrill, Mr. Drees and Mr. Erickson the severance pay
would be an amount equal to one and one-half times each of their respective
annual salary and bonus compensation. All of the executives are also entitled to
a job search lump sum payment of $25,000. All agreements renew automatically
each May, unless the Board of Directors provides at least ninety days notice
prior to May that the agreement will not be renewed.</P>
<P>For purposes of each of these agreements, a "change in control" generally
means any of the following events: (1) the consummation of a consolidation,
merger or other reorganization in which the Company is merged, consolidated or
reorganized into or with another corporation or other legal person or in which
shares of the Compan's stock are converted into cash, securities or other
property, other than a merger of the Company in which the holders of ANS' common
stock immediately prior to the merger own more than 50% of the common stock of
the surviving corporation or its ultimate parent immediately after the merger;
(2) the sale of all or substantially all of our assets; (3) if at any time the
persons serving on ANS' Board of Directors cease for any reason to constitute at
least a majority thereof; and (4) the approval by our shareholders of our
complete liquidation or dissolution.</P>
<P><U>Employment Agreement</U>&nbsp; We entered into an employment agreement as
of April 1, 2002 with Mr. Christopher G. Chavez pursuant to which Mr. Chavez
serves as Chief Executive Officer and President of the Company. Under the
employment agreement, which has a term of three years, Mr. Chavez receives an
annual base salary of $253,500. In addition, Mr. Chavez may receive a
performance-based incentive bonus equal to 60% of his annual base salary earned
by meeting certain strategic milestones and objective measurements of
profitability and shareholder value determined annually by mutual agreement of
Mr. Chavez and the Board of Directors. If Mr. Chavez' performance exceeds the
objectives so established, Mr. Chavez could earn a larger bonus, and
correspondingly, if performance falls short of the objectives, Mr. Chavez may
receive less than the full bonus percentage. Mr. Chavez is also entitled to
employee benefits generally made available to other officers of the Company and
certain other perquisites. If the Company terminates Mr. Chavez' employment
without cause (as defined in the agreement), Mr. Chavez will receive severance
compensation equal to 200% of his annual salary and anticipated annual bonus.
The employment agreement also contains confidentiality, trade secret and
noncompetition provisions that are intended to protect the Company's
intellectual property, trade secrets and other confidential information.
<P><U>Employment Agreement</U>&nbsp; We entered into an employment agreement as
of January 2, 2001 with Mr. Anthony J. Varrichio, pursuant to which Mr.
Varrichio serves as an Executive Vice President of ANS and President of the
Company's subsidiary, Hi-tronics Designs, Inc. Under the employment agreement,
which has a term of two years, Mr. Varrichio receives a minimum annual base
salary of $150,000. In addition, Mr. Varrichio may receive a performance-based
incentive bonus in accordance with Company policy established by the Board of
Directors from time to time. Mr. Varrichio is also entitled to employee benefits
generally made available to other officers of the Company.</P>
<P>If the Company terminates Mr. Varrichio's employment without cause (as
defined in the agreement), Mr. Varrichio will receive severance compensation
based on his monthly base salary until the second anniversary date of the
agreement (January 2003), or if less than six months remain in the term of the
agreement, the Company will pay severance compensation equal to six months of
his monthly base salary. The employment agreement also contains confidentiality,
trade secret and noncompetition provisions that are intended to protect the
Company's intellectual property, trade secrets and other confidential
information.</P>
<P ALIGN=CENTER>Page 16</P>
<HR>

<PAGE>
<P ALIGN=CENTER><B><U>COMPENSATION COMMITTEE REPORT</U></B></P>
<P>The Compensation Committee, comprised of three independent outside directors,
recommends compensation strategies, policies, and programs to the Board of
Directors and approves annual salary and cash bonus awards to executive officers
and long-term incentive awards to all key employees.</P>
<P>The Board of Directors and the Compensation Committee believe that the
Company's success requires a small, but highly motivated professional staff. The
Compensation programs, therefore, are primarily designed to attract and retain
highly capable executives and key employees, to motivate the performance of
executives in support of the achievement of the Company's strategic financial
and operating performance objectives and to reward performance that meets this
standard.</P>
<P>The Company's executive compensation program combines base salary, annual
bonus, and a stock option program to attract and retain executives. Base salary
increases and annual bonuses are based, in part, on corporate performance.
Compensation is also based on a competitive analysis of compensation paid by
other comparable companies, current market conditions for recruiting highly
skilled and/or specialized talent, the need to retain key executives, the
experience level and market worth of current executives, and individual
performance.</P>
<P>Under the Company's annual bonus program, year-end cash bonuses are awarded
to executive officers based on the level of achievement of annual revenue and
earnings objectives. Targeted bonus levels for executive officers are
established by the Compensation Committee annually, as well as individual
performance.</P>
<P>The stock option programs of the Company are long-term incentive plans for
executive officers and key employees that are intended to motivate executives
and employees to improve total return to shareholders. Stock options are
generally granted annually, with an exercise price of the fair market value of
the common stock on the date of the grant. The number of options granted to a
recipient is determined using various factors such as the long-term incentives
granted to executive officers in companies of comparable size and the
contribution of the individual recipient to the Company. To encourage long-term
performance, options generally vest over a four-year period.</P>
<P ALIGN=CENTER>Page 17</P>
<HR>

<PAGE>
<P>In addition to using local and national survey data the Company, on occasion,
uses the services of independent compensation and benefits consulting firms to
provide analysis and recommendations for competitive pay levels and programs.
</P>
<P>With the exception of Mr. Varrichio, who entered an employment agreement on
January 2, 2001 at an annual base salary of $150,000, in early 2001, the
Compensation Committee increased the base salary levels of the Company's other
six executive officers by an average of 5%. At year-end 2001, based on
performance for 2001, the Compensation Committee granted cash bonuses of
$383,700 to the seven executive officers.</P>
<P>The base salary of Mr. Chavez, the Chief Executive Officer of the Company,
was increased by 5% to $230,500 in early 2001. The Compensation Committee also
established the target bonus in 2001 for Mr. Chavez of 60% of his base salary,
with a potential range of 0% to 120% of his base salary, depending on the degree
of attainment of the budgeted revenue and earnings objectives of the Company in
2001. Based on 2001 results, the Compensation Committee awarded Mr. Chavez a
cash bonus of $138,300, which is part of the $383,700 of total bonuses granted
to the Company's seven executive officers for 2001.</P>
<P>In 2001, Mr. Chavez was also granted options to purchase 25,000 shares of
common stock at an exercise price of $10.625, the fair market value of the stock
on the date of the grant.</P>
<P>Compensation in excess of $1 million per year realized by any of our five
most highly compensated executive officers is not deductible by us for federal
income tax purposes unless the compensation arrangement complies with the
requirements of Section 162(m) of the Internal Revenue Code of 1986, as amended.
We have complied, and intend to continue to comply, with the requirements of
Section 162(m).</P>
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR>
<TD WIDTH=20%>&nbsp;</TD>
<TD WIDTH=80%>COMPENSATION COMMITTEE<BR>Hugh M. Morrison - Chairman, Robert C.
Eberhart, Michael J. Torma</TD></TR></TABLE>
<P><I>This Compensation Committee report will not be deemed to be incorporated
by reference in any filing by the Company under the Securities Act of 1933, as
amended (the "Securities Act"), or the Exchange Act of 1934, as amended (the
"Exchange Act"), except to the extent that the Company specifically incorporates
this report by reference.</I></P>
<P ALIGN=CENTER>Page 18</P>
<HR>

<PAGE>
<P ALIGN=CENTER><B><U>PERFORMANCE GRAPH</U></B></P>
<P>The following graph compares the cumulative total return of the Company's
common stock during the period commencing December 31, 1996 through December 31,
2001, with the Nasdaq U.S. Market Index and an index of companies within the
Standard Industrial Code for Medical Devices, Instruments, and Supplies (the
"Peer Index").</P>
<P ALIGN=CENTER>[The following table is represented as a line chart in the
printed material.]</P>
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR>
<TD WIDTH=16%>&nbsp;</TD>
<TD WIDTH=14% ALIGN=CENTER><U>Dec. 1996</U></TD>
<TD WIDTH=14% ALIGN=CENTER><U>Dec. 1997</U></TD>
<TD WIDTH=14% ALIGN=CENTER><U>Dec. 1998</U></TD>
<TD WIDTH=14% ALIGN=CENTER><U>Dec. 1999</U></TD>
<TD WIDTH=14% ALIGN=CENTER><U>Dec. 2000</U></TD>
<TD WIDTH=14% ALIGN=CENTER><U>Dec. 2001</U></TD></TR>
<TR>
<TD WIDTH=16%>ANS</TD>
<TD ALIGN=CENTER WIDTH=14%>100.00</TD>
<TD ALIGN=CENTER WIDTH=14%>&nbsp;89.923</TD>
<TD ALIGN=CENTER WIDTH=14%>&nbsp;81.458</TD>
<TD ALIGN=CENTER WIDTH=14%>120.968</TD>
<TD ALIGN=CENTER WIDTH=14%>262.903</TD>
<TD ALIGN=CENTER WIDTH=14%>454.839</TD></TR>
<TR>
<TD WIDTH=16%>Nasdaq Market Index</TD>
<TD ALIGN=CENTER WIDTH=14%>100.00</TD>
<TD ALIGN=CENTER WIDTH=14%>122.482</TD>
<TD ALIGN=CENTER WIDTH=14%>172.704</TD>
<TD ALIGN=CENTER WIDTH=14%>320.874</TD>
<TD ALIGN=CENTER WIDTH=14%>193.001</TD>
<TD ALIGN=CENTER WIDTH=14%>153.146</TD></TR>
<TR>
<TD WIDTH=16%>Peer Index</TD>
<TD ALIGN=CENTER WIDTH=14%>100.00</TD>
<TD ALIGN=CENTER WIDTH=14%>114.100</TD>
<TD ALIGN=CENTER WIDTH=14%>127.029</TD>
<TD ALIGN=CENTER WIDTH=14%>153.845</TD>
<TD ALIGN=CENTER WIDTH=14%>158.719</TD>
<TD ALIGN=CENTER WIDTH=14%>174.369</TD>
</TR></TABLE>
<P><I>The stock price performance depicted in the Performance Graph is not
necessarily indicative of future price performance. The Performance Graph will
not be deemed to be incorporated by reference in any filing by the Company under
the Securities Act or the Exchange Act.</I></P>
<P ALIGN=CENTER>Page 19</P>
<HR>

<PAGE>
<P ALIGN=CENTER><B><U>AUDIT COMMITTEE REPORT</U></B></P>
<P>The Audit Committee is comprised of three outside directors who are
independent, as defined in Rule 4200(a)(15) of the National Association of
Securities Dealers' listing standards. The Committee operates under a written
charter adopted by the Board of Directors.</P>
<P>Management is responsible for ANS' internal controls and financial reporting
process. The independent auditors are responsible for performing an independent
audit of ANS' consolidated financial statements in accordance with generally
accepted auditing standards and issuing a report to the Board of Directors on
the results of the audit. The Committee's responsibility is to monitor and
oversee these processes.</P>
<P>The Committee has met and held discussions with management and Ernst &amp;
Young LLP, ANS' independent auditors. These meetings included sessions at which
management was not present. The Committee discussed with Ernst &amp; Young LLP
the results of its examination of ANS' consolidated financial statements, its
evaluation of ANS' internal controls and its assessment of the overall quality
of ANS' financial controls. Management represented to the Committee that ANS'
consolidated financial statements were prepared in accordance with generally
accepted accounting principles. The Committee reviewed and discussed the
consolidated financial statements with management and Ernst &amp; Young LLP. The
Committee also discussed with Ernst &amp; Young LLP matters related to the
financial reporting process required to be discussed by Statement on Auditing
Standards No. 61 (Communication with Audit Committees).</P>
<P>Ernst &amp; Young LLP also provided to the Committee the written disclosures
and the letter required by Independence Standards Board Standard No. 1
(Independence Discussions with Audit Committees), and the Committee reviewed
with Ernst &amp; Young LLP that firm's independence.</P>
<P>Based on the Committee's discussions with management and Ernst &amp; Young
LLP, the Committee's review of the representations of management, and the report
of Ernst &amp; Young LLP to the Committee, the Committee recommended that the
Board of Directors include the audited consolidated financial statements in ANS'
Annual Report on Form 10-K for the year ended December 31, 2001.</P>
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR>
<TD WIDTH=20%>&nbsp;</TD>
<TD WIDTH=80%>AUDIT COMMITTEE<BR>Richard D. Nikolaev - Chairman, Joseph E.
Laptewicz, A. Ronald Lerner</TD></TR></TABLE>
<P><I>The Report of the Audit Committee and the information contained in the
Report shall not be deemed to be "soliciting material" or to be "filed" with the
Commission or subject to Regulation 14A or 14C of the Securities Act of 1933, as
amended, other than as provided in Item 306 of Regulation S-K thereunder, or
subject to the liabilities of Section 18 of the Securities and Exchange Act of
1934, as amended, and shall not be deemed incorporated into any filings of the
Company other than this proxy statement, except as specified by the Company.
</I></P>
<P ALIGN=CENTER>Page 20</P>
<HR>

<PAGE>
<P ALIGN=CENTER><B><U>OTHER INFORMATION</U></B></P>
<P><B><U>Compliance With Section 16(a) Of The Exchange Act</U></B></P>
<P>Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's directors, executive officers and persons who own more than 10% of
the Company's common stock, to file with the Securities and Exchange Commission
(the "SEC") initial reports of ownership and reports of changes in ownership of
common stock and other equity securities of the Company.</P>
<P>Upon receipt of the appropriate information, the Company has prepared all
Forms 3, 4 and 5 for its non-employee directors and executive officers, subject
to their review and signing prior to filing with the SEC. Based solely on the
information provided to the Company by individual non-employee directors and
executive officers, the Company believes that all filing requirements applicable
to such persons were complied with in 2001, except that Anthony J. Varrichio,
Executive Vice President and Chief Technology Officer of the Company, filed a
late Form 4 Report of Changes in Beneficial Ownership of Securities with the SEC
disclosing the sale of 12,000 shares of the Company's common stock by Mrs.
Sherry Varrichio, Mr. Varrichio's spouse. Mrs. Varrichio's sale was made in
January 2001 and the Form 4 was filed with the SEC in April 2001. Mr. Varrichio
also filed a late Form 4 Report of Changes in Beneficial Ownership of Securities
with the SEC disclosing the sale of 17,000 shares of the Company's common stock.
The sale of the shares by Mr. Varrichio was made in August 2001 and the Form 4
was filed with the SEC on September 17, 2001, approximately one week late.</P>
<P><B><U>Independent Auditor</U></B></P>
<P>Ernst &amp; Young LLP has been selected by the Board of Directors as the
Company's independent auditor for the current year. Representatives of Ernst
&amp; Young LLP are expected to be present at the Annual Meeting and will have
an opportunity to make a statement if they desire to do so, and are expected to
be available to respond to appropriate questions.</P>
<P><B><U>Annual Report on Form 10-K</U></B></P>
<P>You can request a free copy of ANS' 2001 Annual Report on Form 10-K by
writing to Marta Munson, Investor Relations, Advanced Neuromodulation Systems,
Inc., 6501 Windcrest Drive, Suite 100, Plano, Texas 75024 or by email at
<U>m.munson@ans-medical.com</U>.</P>
<P ALIGN=CENTER>Page 21</P>
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