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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549





FORM 10-K/A

AMENDMENT NO. 1





(Mark One)

|x | Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
|- | ------------------------------------------------------------------------------------

For the fiscal year ended December 31, 2008

or



| ̈ | Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
|- | ----------------------------------------------------------------------------------------

For the transition period from              to

Commission file number 0-20991





CAMBRIDGE HEART, INC.

(Exact Name of Registrant as Specified in its Charter)







|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|DELAWARE                                                       |  | 13-3679946                          
|(State or Other Jurisdiction of Incorporation or Organization) |  | (I.R.S. Employer Identification No.)
|                                                               | 
|100 Ames Pond Road, Tewksbury, MA                              |  | 01876                               
|(Address of Principal Executive Offices)                       |  | (Zip Code)                          

(978) 654-7600

(Registrants telephone number, including area code)

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

NONE

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

Common Stock, $0.001 par value

Title of class





Indicate by check mark if the
registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.     ̈  Yes    x  No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the
Act.     ̈  Yes    x  No

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

Indicate by check mark whether the
registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the receding 12 months (or for such shorter period
that the registrant was required to submit and post such files).    Yes   ̈    No   ̈

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

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a
smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.



|                                                                                                                              |  |  |  |  |  | 
|----------------------------------------------------------------------------------------------------------------------------- |  |  |  |  |  | 
|Large accelerated filer   ̈         Accelerated filer   ̈         Non-accelerated filer   ̈         Smaller reporting company  x

Indicate by check mark whether the registrant is a shell company     ̈  Yes    x  No

The aggregate
market value of the common stock held by non-affiliates of the registrant was $27,887,683 computed by reference to the last reported sale price of the common stock on the OTC Bulletin Board on June 30, 2008.

As of March 31, 2009, 64,992,521 shares of the registrants common stock were outstanding.









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CAMBRIDGE HEART, INC.

INDEX TO ANNUAL REPORT ON FORM 10-K/A

AMENDMENT NO. 1

Securities and Exchange Commission

Item Number and Description



|             |  |                                                                                                |  |     
|------------ |  | ---------------------------------------------------------------------------------------------- |  | ----
|             |  |                                                                                                |  | Page
|             |  | PART III                                                                                       |  |     
|             |  |                                                                                               
|Item 10      |  | Directors, Executive Officers and Corporate Governance                                         |  | 1   
|Item 11      |  | Executive Compensation                                                                         |  | 3   
|Item 12      |  | Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters |  | 9   
|Item 13      |  | Certain Relationships and Related Transactions, and Director Independence                      |  | 12  
|Item 14      |  | Principal Accountant Fees and Services                                                         |  | 15  
|             |  |                                                                                               
|             |  | PART IV                                                                                        |  |     
|Item 15      |  | Exhibits and Financial Statement Schedules                                                     |  | 15  
|             | 
|Signatures   |  | 16                                                                                            
|             | 
|Exhibit 31.1 |  |                                                                                               
|Exhibit 31.2 |  |                                                                                               

EXPLANATORY NOTE

Cambridge Heart, Inc. (Cambridge Heart or the Company) is filing this Amendment No. 1 to its Annual Report on Form 10-K,
originally filed with the Securities and Exchange Commission on March 31, 2009 (the Initial Filing), solely for the purpose of amending and supplementing Part III of the Annual Report on Form 10-K. This amendment changes our Annual
Report by including information required by Part III (Items 10, 11, 12, 13 and 14).

Pursuant to Rule 12b-15 promulgated under the
Securities Exchange Act of 1934, as amended (the Exchange Act), the Company has filed the certificates required by Rule 13a-14(a) or 15d-14(a) of the Exchange Act as exhibits 31.1 and 31.2.

Except as contained herein, this Amendment No. 1 does not modify or update disclosures contained in the Initial Filing. This Amendment No. 1
should be read in conjunction with the Companys other filings made with the Securities and Exchange Commission subsequent to the date of the Initial Filing.



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PART III



|Item 10. | Directors, Executive Officers and Corporate Governance
|-------- | ------------------------------------------------------

Background of Directors and Executive Officers

Set forth below are the name and age of each of our current directors and
the positions held by him with us, his principal occupation and business experience during the last five years, the names of other publicly held companies of which he serves as a director and the year of the commencement of his term as a director.
Information concerning the background of our executive officers is included in Part I, Item 4A of this Annual Report on Form 10-K. No director or executive officer is related by blood, marriage or adoption to any other director or executive
officer.



|                              |  |                    
|----------------------------- |  | -------------------
|RICHARD J. COHEN, M.D., Ph.D. |  | Director since 1993
|                              |  | Age: 58            

Dr. Cohen, the scientific founder of the Company, has been a consultant to the Company since
February 1993. Dr. Cohen is the Whitaker Professor of Biomedical Engineering at the Massachusetts Institute of Technology in the Harvard-MIT Division of Health Sciences and Technology, where he has been on the faculty since 1979. From 1985 to
1995, Dr. Cohen was the Director of the Harvard-MIT Center for Biomedical Engineering located at the Massachusetts Institute of Technology. From 1997 to 2006 Dr. Cohen was the Team Leader of the Cardiovascular Alterations Team of the
National Space Biomedical Research Institute. He is currently Co-Director of the Biomedical Enterprise Program jointly administered by the Harvard-MIT Division of Health Sciences and Technology and the MIT Sloan School of Management. Dr. Cohen
has authored over 250 published research articles and over 25 issued United States patents. Dr. Cohen holds A.B. and M.D. degrees from Harvard University and a Ph.D. in Physics from The Massachusetts Institute of Technology.



|                  |  |                    
|----------------- |  | -------------------
|RODERICK DE GREEF |  | Director since 2008
|                  |  | Age: 48            

Mr. de Greef has been Chairman of the Board of the Company since November 2008. During the
same period, Mr. de Greef has been employed by the Company to work with the Companys Chief Executive Officer and the Board of Directors to formulate the strategic plan of the Company and to oversee the execution of corporate strategy. In
addition to serving as the Companys Chairman of the Board, Mr. de Greef provides corporate advisory services to several other companies. Mr. de Greef served as the Companys Chief Financial Officer from October 2005 to July 2007
and as the Companys Vice President of Finance and Administration from June 2006 to July 2007. From February 2001 to September 2005, Mr. de Greef was Executive Vice President and Chief Financial Officer of Cardiac Science, Inc., which
merged with Quinton Cardiology, Inc. From 1995 to 2001, Mr. de Greef provided independent corporate advisory services to a number of early-stage companies. From 1986 to 1995, Mr. de Greef served as Chief Financial Officer of several
publicly held, development stage medical technology companies. Mr. de Greef is also a member of the board of directors of several public companies, including Endologix, Inc., and Bio Life Solutions Inc., both of which are in the life sciences
field, and Elephant Talk Communications, Inc. Mr. de Greef has a B.A. in Economics and International Relations from California State University at San Francisco and earned his M.B.A. from the University of Oregon.



|                     |  |                    
|-------------------- |  | -------------------
|KENNETH V. HACHIKIAN |  | Director since 2004
|                     |  | Age: 59            

Mr. Hachikian has been a Principal and Partner of The Stonegate Group, Ltd., a boutique
investment banking and financial advisory firm, since 2003. From 1996 until 2008, Mr. Hachikian was President of Belmont Capital Partners, LLC, a venture capital firm. From 1991 to 1994, Mr. Hachikian served as President of LINC Scientific
Leasing, Inc., and, from 1983 to 1989, as President and CEO of Wellesley Medical Management, Inc.



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Mr. Hachikian has been an owner and/or senior executive of several other businesses in various industries throughout his over 30-year business career,
including Manager of J.O. Pollack LLC from 1997 to 2001. He has also served as a director of several privately held companies since 1996. Mr. Hachikian holds an M.B.A. from Harvard Graduate School of Business Administration and a B.A. in
Economics from Harvard University.



|                         |  |                    
|------------------------ |  | -------------------
|ALI HAGHIGHI-MOOD, Ph.D. |  | Director since 2007
|                         |  | Age: 49            

Dr. Haghighi-Mood has been the President and Chief Executive Officer of the Company since
December 2007. From December 2006 to December 2007, Dr. Haghighi-Mood served as the Companys Executive Vice President, Chief Operating Officer and Chief Technology Officer. From July 2003 to December 2006, Dr. Haghighi-Mood served as
the Companys Vice President, Operations, Research and Development. From January 2002 to July 2003, he served as the Companys Director of Research and has worked in the Companys research and development department since January
1997. Dr. Haghighi-Mood holds B.S. and M.S. degrees in Electrical Engineering from the University of Tehran and a Ph.D. degree in Biomedical Engineering from the University of Sussex.



|             |  |                    
|------------ |  | -------------------
|REED MALLECK |  | Director since 2004
|             |  | Age: 57            

Mr. Malleck has been the Chief Financial Officer of Avidyne Corporation, a developer of
Integrated Flight Deck Systems for light general aviation aircraft since December 2008. Prior to joining Avidyne, Mr. Malleck was a partner of Tatum LLC, a nationwide executive services firm, from December 2007 to December 2008. From March 2006
to December 2007 he was Vice President of Finance and Operations for Healthwyse, LLC, a provider of integrated clinical and financial information systems for homecare and hospice providers. Previously, from November 2002 until March 2006,
Mr. Malleck served as Chief Operating Officer and Chief Financial Officer of Radianse, Inc., a developer and marketer of RF technologies. From June 2000 to November 2002, Mr. Malleck served as Chief Operating Officer and/or Chief Financial
Officer of GE Medical Systems Navigation and Visualization Inc. (formerly Visualization Technology, Inc.). Mr. Malleck also held various senior operational and financial positions with several business units of Hewlett-Packard from 1978 to
1999. Mr. Malleck holds a B.S. in Finance and an MBA from the University of Colorado.



|                |  |                    
|--------------- |  | -------------------
|JOHN F. MCGUIRE |  | Director since 2007
|                |  | Age: 62            

Mr. McGuire is retired. From 2004 to 2007, he was President and Chief Executive Officer of
the American Red Cross. Between 2003 and 2004, Mr. McGuire served as an Executive Vice President at the American Red Cross. Prior to joining the American Red Cross, Mr. McGuire was President of Whatman North America, an international
leader in separations technology and provider of materials and devices to laboratory and healthcare markets. Previously, he served as President, Chief Executive Officer and a director of HemaSure, Inc., a publicly-traded blood filtration company. In
addition, Mr. McGuire has held prominent positions for over 22 years in the field of biomedical technology. Mr. McGuire holds an MBA from Harvard University.



|                |  |                    
|--------------- |  | -------------------
|JEFFREY WIGGINS |  | Director since 2008
|                |  | Age: 53            

Mr. Wiggins is a former Principal of Dresdner RCM Capital Management, where he was
responsible for in excess of $4 billion dollars in health care related investments. Mr. Wiggins joined Dresdner RCM in 1993 and became a Principal in 1997. While there, he started and managed several portfolios, advised other managers in their
health care holdings, and initiated two public mutual funds. Prior to that time, Mr. Wiggins managed a derivative-based hedge fund portfolio investing in biotechnology, medical technology, pharmaceuticals, and health care services at
OConnor & Associates. Mr. Wiggins holds a B.A. from Hope College, with majors in Biology and Chemistry, Masters degrees from Northwestern University in Music and Management, and an M.F.A. from Vermont College.



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Arrangements Concerning Election of Directors

Our certificate of incorporation provides that the holders of our Series A Convertible Preferred Stock (the Series A Preferred) voting as a
separate class, are entitled to elect four members to our Board of Directors as Series A Preferred Directors. As of April 30, 2009, 154 shares of Series A Preferred and warrants to purchase 115,229 shares of Series A Preferred were outstanding
(the Series A Warrants). Robert P. Khederian currently holds 67.6% of the outstanding Series A Preferred and Series A Warrants, including all of the outstanding Series A Preferred. On December 14, 2007, the Company entered into an
Amended and Restated Voting Agreement (the Restated Voting Agreement) with Mr. Khederian. The Restated Voting Agreement was subsequently amended by Amendment No. 1 on May 14, 2008 and by Amendment No. 2 on
May 31, 2008. The material terms of the Restated Voting Agreement, as amended to date, are described in the section titled Transactions with Related Persons contained in Part III, Item 13 of this Annual Report on Form 10-K. Pursuant to the
Restated Voting Agreement, as amended to date, Mr. Khederian has agreed to vote all of his shares of Series A Preferred so as to elect up to four individuals who are nominated or recommended for election as Series A Preferred directors by a
majority of the Board. At the 2008 Annual Meeting of Stockholders, John F. McGuire and Keith M. Serzen were elected to serve as directors by the holders of Series A Preferred.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities
Exchange Act of 1934, as amended (the Exchange Act), requires our directors, executive officers and holders of more than 10% of our Common Stock (Reporting Persons) to file with the Securities and Exchange Commission initial
reports of ownership and reports of changes in ownership of our Common Stock and other equity securities. Based solely on its review of copies of reports filed by the Reporting Persons furnished to us, or written representations from Reporting
Persons, we believe that, during the fiscal year ended December 31, 2008, the Reporting Persons complied with all Section 16(a) filing requirements, with the following exceptions. Mr. Khederian filed a Form 4 on June 2, 2008
reporting the exercise of a warrant to purchase 154 shares of Series A Convertible Preferred Stock on April 23, 2008 and Mr. Wiggins filed a Form 4 on June 9, 2008 reporting the grant of a stock option on May 31, 2008.

Code of Ethics

We have adopted a
written code of business conduct and ethics that applies to our directors, officers and employees, including our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar
functions. We have posted a current copy of the code on our website, which is located at www.cambridgeheart.com. In addition, we intend to post on our website all disclosures that are required by law concerning any amendments to, or waivers from,
any provision of the code.

Audit Committee

The Board of Directors has established a standing Audit Committee of the Board of Directors, which operates under a charter that has been approved by the Board. A current copy of the charter of the Audit Committee is posted on the Corporate
Governance section of our website, www.cambridgeheart.com. The members of the Audit Committee are Mr. McGuire (Chairman), Mr. Malleck and Mr. Wiggins. The Board of Directors has determined that each of Messrs. Malleck and McGuire
is an audit committee financial expert as defined in Item 407(d) of Regulation S-K. The Board of Directors has determined that all members of the Audit Committee are independent as determined under Rule 10A-3 promulgated under the
Exchange Act and as defined by the rules of The Nasdaq Stock Market.



|Item 11. | Executive Compensation
|-------- | ----------------------

The following table sets forth information for the fiscal years ended December 31, 2007 and 2008 concerning the compensation paid to each person serving as the Companys Chief Executive Officer or acting in a similar capacity
during the last completed fiscal year and the Companys Chief Financial Officer (the Named Executive Officers). No other executive officer of the Company received total compensation in excess of $100,000 during the fiscal year ended
December 31, 2008.



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Summary Compensation Table For 2007 and 2008



|                                                                         |  |      |  |           |  |             |  |                    |  |                                            |  |                          |  |          
|------------------------------------------------------------------------ |  | ---- |  | --------- |  | ----------- |  | ------------------ |  | ------------------------------------------ |  | ------------------------ |  | ---------
|Name and Principal Position(1)                                           |  | Year |  | Salary($) |  | Bonus($)(2) |  | OptionAwards($)(3) |  | Non-EquityIncentive PlanCompensation($)(4) |  | All OtherCompensation($) |  | Total ($)
|Ali Haghighi-Mood                                                        |  | 2008 |  | 275,000   |  |            |  | 1,091,939          |  |                                           |  |                         |  | 1,366,939
|President and Chief Executive Officer                                    |  | 2007 |  | 227,466   |  | 36,000      |  | 711,724            |  |                                           |  |                         |  | 975,190  
|Vincenzo LiCausi                                                         |  | 2008 |  | 155,000   |  |            |  | 244,595            |  | 23,000                                     |  |                         |  | 422,595  
|Vice President of Finance and Administration and Chief Financial Officer |  | 2007 |  | 106,181   |  |            |  | 134,939            |  | 11,000                                     |  |                         |  | 252,120  



|(1) | Dr. Haghighi-Mood became our President and Chief Executive Officer in December 2007. Previously, from December 2006 until December 2007, he served as our Executive Vice
President, Chief Operating Officer and Chief Technology Officer. Mr. LiCausi became our Vice President, Finance and Administration and Chief Financial Officer in July 2007. Previously, from October 2006 until July 2007, he served as our
Corporate Controller.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Consists of cash bonus awards to the Named Executive Officers that were accrued for 2007 and 2008 whether or not such bonuses were paid in that year.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | Reflects the compensation cost related to all outstanding awards recognized in 2007 and 2008 for financial statement reporting purposes in accordance with Statement of Financial
Accounting Standards No. 123R (SFAS No. 123R), excluding the impact of estimated forfeitures related to service-based vesting conditions. Assumptions made in the calculation of these amounts are included in Note 2 to the
Companys audited financial statements for the fiscal year ended December 31, 2008, included in the Companys Annual Report on Form 10-K, as filed with the Securities and Exchange Commission.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | Consists of cash bonus paid pursuant to the non-equity incentive plan awards.
|--- | -----------------------------------------------------------------------------

Severance Arrangements with Named Executive Officers

The Company has entered into agreements with each of the Named
Executive Officers providing for the payment of severance benefits in the event of a qualifying termination of employment. Under these agreements, if the executive officers employment is terminated by the Company without cause (as defined in
the respective agreement), the executive officer will be entitled to receive severance compensation equal to the executive officers base salary as in effect at the time of such termination and continued healthcare benefits for a period of six
months in the case of Mr. LiCausi and 12 months in the case of Dr. Haghighi-Mood.

In the event that Dr. Haghighi-Mood
terminates his employment within 30 days following the occurrence of changed circumstances, he is entitled to receive the severance benefits as though his employment had been terminated by the Company without cause. For purposes of his employment
agreement, changed circumstances includes (i) a material reduction in the nature or scope of Dr. Haghighi-Moods responsibilities, authority or powers as President and Chief Executive Officer of the Company, including, without
limitation, due to the Board having hired or appointed another senior executive officer to whom the Executive is requested by the Board to report or who reports directly to the Board or who is given responsibilities or authority normally exercised
by an executive in the positions of President and Chief Executive Officer of a Company generally comparable to the Company, in each case without Dr. Haghighi-Moods consent; and (ii) any failure by the Company to nominate and
recommend to stockholders that they reelect Dr. Haghighi-Mood to serve as a director of the Company upon the expiration of his term.

In the event of a change in control (as defined in the severance agreements) that does not result in termination of the executive officers employment, 50% of the executive officers unvested options (100% of
Dr. Haghighi-Moods unvested options) that are then outstanding will become immediately exercisable. In the



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event of a change in control that results in the termination of the executive officers employment without cause or by the executive officer for good
reason (each as defined in the severance agreements), the executive officer will be entitled to receive severance compensation in an amount equal to the executive officers base salary as in effect at the time of such termination for a period
of 12 months and continued healthcare benefits for a period of 12 months, and all of the executive officers unvested options which are then outstanding will become immediately exercisable.

The Company included enhanced severance benefits in the event of a change in control of the Company in order to remove any financial concerns an
executive may have when evaluating a potential transaction and to allow him to focus on maximizing value for the Companys stockholders. The Compensation Committee believes that these change in control benefits are necessary given the
volatility and uncertainty inherent in the Companys line of business.

Employment Agreement with Chief Executive Officer

On December 14, 2007, the Company appointed Dr. Haghighi-Mood as the Companys President and Chief Executive Officer and elected him
as a director of the Company. Dr. Haghighi-Mood and the Company entered into an employment agreement dated December 14, 2007, the terms of which were approved by the Board of Directors of the Company after negotiations with
Dr. Haghighi-Mood.

Under the terms of the employment agreement, Dr. Haghighi-Mood will be paid an annual base salary
of $275,000 per year and will be entitled to receive the severance benefits described above under the title Severance Arrangements with Named Executive Officers. Dr. Haghighi-Mood also will have the opportunity to earn an
annual performance bonus based upon the achievement by the Company of performance goals to be agreed upon by Dr. Haghighi-Mood and the Board of Directors or the Compensation Committee.

Under the terms of the employment agreement, Dr. Haghighi-Mood was eligible to receive a performance bonus for the year ended December 31, 2008
based upon the sales revenue of the Company for the year ended December 31, 2008 and the achievement by the Company of other performance goals in 2008. The portion of the 2008 performance bonus based upon the sales revenue of the Company was
equal to the sum of (i) $20,000 that is payable upon the achievement by the Company of $16.0 million in sales revenue amount in 2008 and (ii) 1.00% of sales revenue in 2008 above $16.0 million. The remaining portion of the 2008 performance
bonus in the amount of up to $70,000 was be based upon the achievement of performance goals established by the Compensation Committee and approved by the Board of Directors in consultation with Dr. Haghighi-Mood related to:



| |  |  | the development of the Companys technology, including the advancements in the Companys patent portfolio and in-licensed technology and other
advancements in the Companys Microvolt T-Wave Alternans technology;
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the Companys management, including, without limitation, the successful development and/or recruitment of various management talents and capabilities needed by
the Company as mutually identified from time to time by the Board of Directors and Dr. Haghighi-Mood on a timetable to be mutually agreed upon;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the Companys operations, research and development activities and regulatory matters; and
| | - |  | -----------------------------------------------------------------------------------------



| |  |  | the Companys securing reimbursement from additional private insurers on the timetable to be mutually agreed upon.
| | - |  | ------------------------------------------------------------------------------------------------------------------

Dr. Haghighi-Mood was not eligible to receive the portion of his 2008 performance bonus based upon sales revenue for 2008 because the Companys
sales for the year ended December 31, 2008 did not exceed the minimum specified target. The Compensation Committee recommended to the Board of Directors that Dr. Haghighi-Mood be awarded a bonus based upon the qualitative performance goals
described above. Dr. Haghighi-Mood declined to accept any bonus for 2008.



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Employment Agreement with Chairman of the Board

Prior to his appointment as Chairman of the Board, from July 2008 to November 2008, Roderick de Greef served as a consultant pursuant to the terms of the
Consulting Agreement between the Company and Mr. de Greef dated July 29, 2008 (the Consulting Agreement). The Consulting Agreement provided that Mr. de Greef would provide consulting services to the Company to promote and
execute the Companys business development activities as an independent contractor. Mr. de Greef was paid a total of $12,308 in fees under the Consulting Agreement. On July 29, 2008, Mr. de Greef received an option to purchase 100,000
shares of the Common Stock of the Company at an exercise price of $0.33 per share (the July 2008 Option). The option becomes exercisable if, during the term of the Consulting Agreement or within 12 months thereafter, the Company executes
a strategic transaction in which Mr. de Greef was involved.

On November 24, 2008, the Board of Directors elected Mr. de
Greef as a member of the Board of Directors and appointed him to serve as the Chairman of the Board. Mr. de Greef and the Company entered into an employment agreement dated November 24, 2008 the terms of which were approved by the Board of
Directors of the Company after negotiations with Mr. de Greef.

The Employment Agreement provides that Mr. de Greef will devote
approximately 50% of a regular work week to the business and interests of the Company. Specifically, the Employment Agreement provides that Mr. de Greef will work with the Companys Chief Executive Officer and the Board of Directors to
formulate the strategic plan of the Company and to oversee the execution of corporate strategy. Mr. de Greef will serve on the Companys Board as the Chairman of the Board. During the term of Mr. de Greefs employment by the
Company, at each annual meeting of the Companys stockholders at which Mr. de Greefs membership on the Board has expired, the Company will nominate Mr. de Greef to serve as a member of the Board.

The Employment Agreement has a term of three years commencing on November 24, 2008 and ending on November 24, 2011 (the Employment
Period). The Employment Period will automatically be extended for successive one year periods unless either party gives the other 30 days written notice that it does not wish to extend the term of the Employment Agreement.

The Employment Agreement provides that Mr. de Greef will be paid an annual base salary of $120,000 per year. He will be entitled to participate in
any and all of the Companys employee benefit plans in effect for part-time employees, except to the extent that such benefits are in a category otherwise specifically provided to Mr. de Greef. In the event that Mr. de Greef is
not eligible to participate in the Companys health insurance benefit plan, the Company will reimburse Mr. de Greef up to $2,000 per month for the cost of maintaining his current family medical insurance coverage.

On November 24, 2008, the Board awarded to Mr. de Greef a stock option to purchase 550,000 shares of common stock of the Company. The option
was granted under and subject to the terms of the Companys 2001 Stock Incentive Plan (the 2001 Plan). The exercise price of the option was the closing price per share of the Companys common stock on November 24, 2008
(the Grant Date). The option becomes exercisable in three equal annual installments, beginning on the first anniversary of the Effective Date. The option will expire on the tenth anniversary of the Grant Date.

The dates on which the option will become exercisable will accelerate with regard to a specified number of shares upon the occurrence of certain
performance goals (the Performance Goals). The Performance Goals include: (i) the achievement by the Company of a specified 12-month trailing revenue target (the Revenue Target); (ii) the consummation by the Company
of one or more equity financing transactions in a twelve-month period that result in the receipt by the Company of sufficient proceeds to fund the Companys operations for a 12-month period as determined in good faith by the Board (the
Financing Target); and (iii) the consummation by the Company of a strategic distribution agreement (the Strategic Transaction Target). Upon the occurrence of a Performance Goal, the stock option will become exercisable
with respect to a number of shares equal to the



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lesser of (A) the number of shares specified in the Employment Agreement for each Performance Goal (162,500 shares for each of the Revenue Target
and the Financing Target and 62,500 shares for the Strategic Transaction Target) and (B) the positive difference between total number of shares under the stock option that are not yet exercisable and the number of shares specified in the
Employment Agreement for the Performance Goal. The shares that become exercisable upon the achievement of a Performance Goal will reduce the number of shares that otherwise would next become exercisable on a regular annual vesting date following the
date of achievement of the Performance Goal.

In the event the Company terminates Mr. de Greefs employment without cause, he
would be entitled to severance benefits as set forth in the Employment Agreement, including payment of Mr. de Greefs salary for three months following termination. Mr. de Greef would also receive continuation of his health care
benefits or reimbursement, as the case may be, for three months following termination. In addition, the stock option granted under the Employment Agreement would become exercisable for the number of shares that would have become exercisable had
Mr. de Greef remained employed with the Company for an additional six months following termination and had the stock option become exercisable in 12 equal quarterly installments. If termination occurs prior to November 24, 2011,
Mr. de Greef will have the right to exercise the stock option received under the Employment Agreement as well as the July 2008 Option for a period of two years following termination (but in no event after the expiration of the stock option) to
the extent that he was entitled to exercise the stock option on that date.

In the event that a change in control of the Company occurs and
Mr. de Greefs employment is terminated without cause within 12 months following the change in control, Mr. de Greef is entitled to receive the severance benefits described above for a period of six months following the date of
termination. In the event of a change in control of the Company, Mr. de Greefs stock options received under the Employment Agreement and the July 2008 Option will become exercisable in full as of the date of the change in control,
provided that all stock options must be exercised within the applicable dates provided in the applicable stock option agreement and the 2001 Plan.

Outstanding Equity Awards

The following table sets forth certain information concerning stock options held by the Named
Executive Officers as of December 31, 2008.

Outstanding Equity Awards At Fiscal Year-end For 2008



|                  |  |                                                               |  |                                                                 |  |                         |  |                      
|----------------- |  | ------------------------------------------------------------- |  | --------------------------------------------------------------- |  | ----------------------- |  | ---------------------
|                  |  | Option Awards(1)                                             
|Name              |  | Number ofSecuritiesUnderlyingUnexercisedOptionsExercisable(#) |  | Number ofSecuritiesUnderlyingUnexercisedOptionsUnexercisable(#) |  | OptionExercisePrice ($) |  | OptionExpiration Date
|Ali Haghighi-Mood |  | 333,333                                                       |  |                                                                 |  | 0.29                    |  | 8/15/2015            
|Ali Haghighi-Mood |  | 466,667                                                       |  | 233,333                                                         |  | 3.30                    |  | 12/14/2016           
|Ali Haghighi-Mood |  | 300,000                                                       |  | 600,000                                                         |  | 1.15                    |  | 12/11/2017           
|Ali Haghighi-Mood |  | 150,000                                                       |  | 300,000                                                         |  | 1.15                    |  | 12/11/2017           
|Vincenzo LiCausi  |  | 13,333                                                        |  | 6,667                                                           |  | 2.53                    |  | 10/16/2016           
|Vincenzo LiCausi  |  | 10,000                                                        |  | 20,000                                                          |  | 3.26                    |  | 4/30/2017            
|Vincenzo LiCausi  |  | 50,000                                                        |  | 100,000                                                         |  | 4.00                    |  | 5/18/2017            
|Vincenzo LiCausi  |  |                                                               |  | 150,000                                                         |  | 1.07                    |  | 2/12/2018            



|(1) | The option becomes exercisable in three equal annual installments, beginning on the first anniversary of the date of grant.
|--- | ---------------------------------------------------------------------------------------------------------------------------



7



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Director Compensation

Non-employee directors receive a fee of $2,500 per in-person meeting of the Board of Directors and $500 per telephonic meeting of the Board of Directors or committee meeting, and non-employee directors who serve as
Chairman of the Board or as chairman of one or more committees of the Board of Directors (currently Messrs. McGuire and Wiggins) receive a fee of $3,125 per in-person meeting of the Board of Directors and $625 per telephonic meeting of the
Board of Directors or committee meeting. Each of the Companys non-employee directors receives an annual retainer of $15,000, which is paid to directors in equal quarterly installments.

Mr. Kenneth Hachikian served as Chairman of the Board from June 5, 2008 to November 24, 2008. On July 29, 2008, the Board determined
that Mr. Hachikian would receive an additional annual cash retainer of $48,000, paid quarterly for his services as Chairman of the Board. On November 24, 2008, Mr. de Greef was elected to serve in the capacity of Chairman of the
Board. As of November 24, 2008, Mr. Hachikian had received $23,000 of the additional cash retainer.

The following table sets
forth compensation actually paid, earned or accrued during 2008 by the Companys directors.



|                        |  |                                |  |                    |     |  |                     |      |  |                       |  |          
|----------------------- |  | ------------------------------ |  | ------------------ | --- |  | ------------------- | ---- |  | --------------------- |  | ---------
|Name                    |  | Fees Earned orPaid in Cash ($) |  | Stock Awards($)(1) |     |  | OptionAwards ($)(1) |      |  | All OtherCompensation |  | Total ($)
|Laurence J. Blumberg(2) |  | 4,000                          |  |                   |     |  |                    |      |  |                      |  | 4,000    
|Louis Blumberg(3)       |  |                               |  |                   |     |  |                    |      |  |                      |  |         
|Richard J. Cohen        |  | 46,500                         |  | 241,736            | (4) |  | 36,048              | (5)  |  |                      |  | 324,560  
|Roderick de Greef(6)    |  |                               |  |                   |     |  |                    |      |  |                      |  |         
|Kenneth V. Hachikian    |  | 86,375                         |  |                   |     |  | 34,487              | (7)  |  |                      |  | 120,862  
|Robert P. Khederian(8)  |  | 34,875                         |  |                   |     |  | 328,313             | (8)  |  |                      |  | 363,188  
|Reed Malleck            |  | 66,625                         |  |                   |     |  | 33,667              | (9)  |  |                      |  | 100,292  
|John F. McGuire         |  | 48,500                         |  |                   |     |  | 64,507              | (10) |  |                      |  | 113,007  
|Keith M. Serzen(11)     |  | 51,875                         |  |                   |     |  | 64,507              | (10) |  |                      |  | 116,382  
|Jeffrey Wiggins         |  | 26,250                         |  |                   |     |  | 9,908               | (12) |  |                      |  | 36,158   



|(1) | Reflects the dollar amounts recognized for financial statement reporting purposes for the fiscal year ended December 31, 2008, in accordance with Statement of Financial
Accounting Standards No. 123R (SFAS No. 123R), (excluding the impact of estimated forfeitures related to service-based vesting conditions), and thus may include amounts attributable to awards granted during and before 2008.
Assumptions made in the calculation of these amounts are included in Note 2 to the Companys audited financial statements for the fiscal year ended December 31, 2008, included in the Companys Annual Report on Form 10-K, as filed
with the Securities and Exchange Commission.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Dr. Blumberg resigned as a director on February 13, 2008.
|--- | ---------------------------------------------------------

|(3) | Mr. Blumberg resigned as director on June 5, 2008. Mr. Blumberg did not accept any compensation for his services as a director.
|--- | -------------------------------------------------------------------------------------------------------------------------------

|(4) | As of December 31, 2008, Dr. Cohen held 175,000 shares of restricted stock.
|--- | ---------------------------------------------------------------------------

|(5) | As of December 31, 2008, Dr. Cohen held options to purchase (a) 287,500 shares of Common Stock at exercise price of $0.30 per share, (b) 30,000 shares of Common
Stock at an exercise price of $2.90 per share and (c) 300,000 shares of Common Stock at an exercise price of $0.34 per share.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(6) | Mr. de Greef is an employee of the Company and does not receive additional compensation for his services as a director. See Employment Agreement with Chairman of the
Board for a description of the material terms of Mr. de Greefs employment with the Company.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(7) | Mr. Hachikian was granted a stock option on August 20, 2008 to purchase 30,000 shares of Common Stock at an exercise prices of $0.29 per share. The stock option becomes
exercisable in three equal annual installments beginning on the first anniversary of the date of grant. The grant date fair value of the stock option award, calculated in accordance with SFAS No. 123R is $6,751. As of December 31, 2008,
Mr. Hachikian also held options to purchase (a) 80,000 shares of Common Stock at an exercise price of $0.30 per share and (b) 30,000 shares of Common Stock at an exercise price of $2.90 per share.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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##### Table of Contents

|(8) | Mr. Khederian resigned as a director on August 12, 2008.
|--- | --------------------------------------------------------

|(9) | Mr. Malleck held options to purchase (a) 80,000 shares of Common Stock at an exercise price of $0.30 per share and (b) 30,000 shares of Common Stock at an exercise
price of $2.90 per share.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(10) | As of December 31, 2008, Messrs. McGuire and Serzen each held options to purchase 100,000 shares of Common Stock at an exercise price of $2.40 per share.
|---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------

|(11) | Mr. Serzen resigned as a director on April 22, 2009.
|---- | ----------------------------------------------------

|(12) | Mr. Wiggins was granted a stock option on June 2, 2008 to purchase 100,000 shares of Common Stock at an exercise price of $0.63 per share. The stock option becomes
exercisable in three equal annual installments beginning on the first anniversary of the date of grant. The grant date fair value of the stock option award, calculated in accordance with SFAS No. 123R is $51,178. This is the only stock option
held by Mr. Wiggins as of December 31, 2008.
|---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
|-------- | ----------------------------------------------------------------------------------------------

Securities Authorized for Issuance Under Equity Compensation Plans

The following table provides
information about the securities authorized for issuance under the Companys equity compensation plans as of December 31, 2008.



|                                                              |  |                                                                                          |  |                                                                          |      |                                                                                                                                           |          
|------------------------------------------------------------- |  | ---------------------------------------------------------------------------------------- |  | ------------------------------------------------------------------------ | ---- | ----------------------------------------------------------------------------------------------------------------------------------------- | ---------
|                                                              |  | (a)                                                                                      |  | (b)                                                                      |      | (c)                                                                                                                                      
|Plan category                                                 |  | Number of securities to beissued upon exercise ofoutstanding options,warrants and
rights |  | Weighted-averageexercise price ofoutstanding options,warrants and rights |      | Number of securitiesremaining available forfuture issuance
underequity compensation plans(excluding securitiesreflected in column (a))(3)
|Equity compensation plans approved by security holders(1)     |  | 6,239,867                                                                                |  | $                                                                        | 1.49 |                                                                                                                                           | 1,568,959
|Equity compensation plans not approved by security holders(2) |  | 650,000                                                                                  |  | $                                                                        | 1.56 |                                                                                                                                           |         
|Total                                                         |  | 6,889,867                                                                                |  | $                                                                        | 1.50 |                                                                                                                                           | 1,568,959



|(1) | Consists of the Amended and Restated 1993 Incentive and Non-Qualified Stock Option Plan, the 1996 Equity Incentive Plan, and the 2001 Stock Incentive Plan.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Consists of a stock option to purchase 200,000 shares of Common Stock awarded to Jeffrey J. Langan, and a stock option to purchase 450,000 shares of Common Stock awarded to Ali
Haghighi-Mood.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | Consists of shares of Common Stock issuable under the 2001 Stock Incentive Plan. In addition to being available for future issuance upon exercise of options that may be granted
after December 31, 2008, 1,289,650 shares of Common Stock under the 2001 Stock Incentive Plan may instead be issued in the form of restricted stock.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

In October 2006, as an inducement to Jeffrey J. Langan to accept the position of President and Chief Executive Officer, Mr. Langan was awarded stock options to purchase 2,000,000 shares of Common Stock at an
exercise price of $2.49 per share, which is equal to the closing price per share of the Companys Common Stock on the date of grant. Mr. Langans Employment Agreement with the Company provided that the stock options would vest in
quarterly installments over a three-year period with 100,000 shares vesting on each of January 13, 2007 and April 13, 2007 and 180,000 shares vesting each quarter thereafter. In connection with Mr. Langans resignation as
President and Chief Executive Officer in December 2006, the Company entered into a separation agreement with Mr. Langan. Under the terms of the separation agreement, all of the shares covered by the inducement stock options were cancelled and
forfeited except for 200,000 shares, 100,000 of which became exercisable on January 12, 2007 and 100,000 of which became exercisable on April 13, 2007. A portion of the inducement stock options, including the 200,000 shares that remain
exercisable following Mr. Langans separation from the Company, were granted outside of the Companys equity incentive plans but are nevertheless subject to the terms and conditions of the Companys 2001 Plan.



9



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##### Table of Contents

On December 11, 2007, as an inducement to Ali Haghighi-Mood to accept the position as President
and Chief Executive Officer, Dr. Haghighi-Mood was awarded: (a) a stock option to purchase 900,000 shares of common stock of the Company, which was granted under and subject to the terms and conditions of the Companys 2001 Plan, and
(b) a stock option to purchase 450,000 shares of common stock of the Company, which was granted as a stand-alone award outside of the Companys equity incentive plans but is nevertheless governed by the terms and conditions of the 2001
Plan as though it was granted under the 2001 Stock Incentive Plan. The exercise price of the options is $1.15 per share, which is equal to the closing price per share of the Companys common stock on the date of grant. The options become
exercisable in three equal annual installments beginning on the first anniversary of the grant date. The options become exercisable in full in the event of a Change in Control (as defined in the Severance Agreement dated September 17, 2003
between the Company and Dr. Haghighi-Mood, as amended by letter agreement dated December 14, 2006). The options will expire on the tenth anniversary of the grant date.

Security Ownership of Certain Beneficial Owners and Management

The following table sets forth
certain information with respect to the beneficial ownership of Common Stock, Series A Preferred and Series C Convertible Preferred Stock (the Series C Preferred) by: (i) each director and nominee, (ii) each of the executive
officers named in the Summary Compensation Table above, (iii) all current directors and executive officers as a group, and (iv) each stockholder known to the Company to be the beneficial owner of more than 5% of the outstanding shares of
Common Stock, Series A Preferred or Series C Preferred.

Unless otherwise indicated in the footnotes to the table, all information set
forth in the table is as of April 30, 2009, and the address for each director and executive officer of the Company is: c/o Cambridge Heart, Inc., 100 Ames Pond Drive, Tewksbury, MA 01876. The addresses for the greater than 5% stockholders
are set forth in the footnotes to this table.



|                                                            |  |                                     |      |  |                               |   |  |                                     |      |  |                               |   |  |                                     |  |                               |  
|----------------------------------------------------------- |  | ----------------------------------- | ---- |  | ----------------------------- | - |  | ----------------------------------- | ---- |  | ----------------------------- | - |  | ----------------------------------- |  | ----------------------------- | -
|                                                            |  | Common Stock                        |      |  | Series A Preferred            |   |  | Series C Preferred                  |     
|                                                            |  | Number ofSharesBeneficiallyOwned(1) |      |  | Percentageof ClassOutstanding |   |  | Number ofSharesBeneficiallyOwned(1) |      |  | Percentageof ClassOutstanding |   |  | Number ofSharesBeneficiallyOwned(1) |  | Percentageof ClassOutstanding |  
|Directors                                                   |  |                                     |      |  |                               |   |  |                                     |      |  |                               |   |  |                                     |  |                               |  
|Ali Haghighi-Mood, Ph.D.                                    |  | 1,250,000                           | (2)  |  | 1.89                          | % |  |                                    |      |  |                              |   |  |                                    |  |                              |  
|Roderick de Greef                                           |  |                                    |      |  | *                             |   |  |                                    |      |  |                              |   |  |                                    |  |                              |  
|Richard J. Cohen, M.D., Ph.D.                               |  | 2,141,885                           | (3)  |  | 3.27                          | % |  |                                    |      |  |                              |   |  |                                    |  |                              |  
|Kenneth Hachikian                                           |  | 100,000                             | (4)  |  | *                             |   |  |                                    |      |  |                              |   |  |                                    |  |                              |  
|Reed Malleck                                                |  | 100,000                             | (4)  |  | *                             |   |  |                                    |      |  |                              |   |  |                                    |  |                              |  
|John McGuire                                                |  | 33,333                              | (5)  |  | *                             |   |  |                                    |      |  |                              |   |  |                                    |  |                              |  
|Jeffrey Wiggins                                             |  | 33,333                              | (5)  |  | *                             |   |  |                                    |      |  |                              |   |  |                                    |  |                              |  
|                                                            |  |                                     |      |  |                               |  
|Named Executive Officers                                    |  |                                     |      |  |                               |   |  |                                     |      |  |                               |   |  |                                     |  |                               |  
|Ali Haghighi-Mood, Ph.D.                                    |  | 1,250,000                           | (2)  |  | 1.89                          | % |  |                                    |      |  |                              |   |  |                                    |  |                              |  
|Vincenzo LiCausi                                            |  | 183,333                             | (6)  |  | *                             |   |  |                                    |      |  |                              |   |  |                                    |  |                              |  
|All directors and executive officers as a group (9 persons) |  | 3,841,884                           | (7)  |  | 5.71                          | % |  |                                    |      |  |                              |   |  |                                    |  |                              |  
|                                                            |  |                                     |      |  |                               |  
|5% Stockholders                                             |  |                                     |      |  |                               |   |  |                                     |      |  |                               |   |  |                                     |  |                               |  
|Robert P. Khedarian                                         |  | 5,915,168                           | (8)  |  | 9.10                          | % |  | 78,054                              | (9)  |  | 100                           | % |  |                                    |  |                              |  
|AFB Fund, LLC                                               |  | 4,615,168                           | (10) |  | 7.10                          | % |  |                                    |      |  |                              |   |  |                                    |  |                              |  
|St. Jude Medical, Inc.                                      |  | 4,180,602                           | (11) |  | 6.04                          | % |  |                                    |      |  |                              |   |  | 5,000                               |  | 100                           | %
|Semana Capital, L.P.                                        |  | 3,754,736                           | (12) |  | 5.78                          | % |  |                                    |      |  |                              |   |  |                                    |  |                              |  
|Leaf Offshore Investment Fund Ltd.                          |  | 441,168                             | (13) |  | *                             |   |  | 33,396                              | (14) |  | 99.55                         | % |  |                                    |  |                              |  
|J. Leighton Read                                            |  | 44,109                              | (15) |  | *                             |   |  | 3,393                               | (16) |  | 95.66                         | % |  |                                    |  |                              |  



10



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##### Table of Contents



|* | Represents less than 1% of the outstanding Common Stock.
|- | --------------------------------------------------------

|(1) | The Company believes that each stockholder has sole voting and investment power with respect to the shares of Common Stock, Series A Preferred and Series C Preferred listed, except
as otherwise noted. The number of shares beneficially owned by each stockholder is determined under rules of the Securities and Exchange Commission, and the information is not necessarily indicative of ownership for any other purpose. Under these
rules, beneficial ownership includes any shares as to which the person has sole or shared voting power or investment power and also any shares which the individual has the right to acquire within 60 days after April 30, 2009 through the
exercise of any stock option, warrant, conversion of preferred stock or other right. The inclusion herein of any shares of Common Stock, Series A Preferred or Series C Preferred deemed beneficially owned does not constitute an admission by such
stockholder of beneficial ownership of those shares of Common Stock, Series A Preferred or Series C Preferred. Shares of Common Stock, Series A Preferred or Series C Preferred which an individual or entity has a right to acquire within the 60-day
period following April 30, 2009 pursuant to the exercise of options, warrants or conversion rights are deemed to be outstanding for the purposes of computing the percentage ownership of such individual or entity, but are not deemed to be
outstanding for the purpose of computing the percentage ownership of any other person or entity shown in the table.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Includes 1,250,000 shares of Common Stock issuable upon the exercise of stock options.
|--- | --------------------------------------------------------------------------------------

|(3) | Includes 607,500 shares of Common Stock issuable upon the exercise of stock options.
|--- | ------------------------------------------------------------------------------------

|(4) | Includes 100,000 shares of Common Stock issuable upon the exercise of stock options.
|--- | ------------------------------------------------------------------------------------

|(5) | Includes 33,333 shares of Common Stock issuable upon the exercise of stock options.
|--- | -----------------------------------------------------------------------------------

|(6) | Includes 183,333 shares of Common Stock issuable upon the exercise of stock options.
|--- | ------------------------------------------------------------------------------------

|(7) | See notes 2 through 6 above.
|--- | ----------------------------

|(8) | Includes (i) 2,002 shares of Common Stock issuable upon the conversion of shares of Series A Preferred, and (ii) 1,012,700 shares of Common Stock issuable upon the
conversion of shares of Series A Preferred issuable upon the exercise of Series A Preferred warrants.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(9) | Includes 77,900 shares of Series A Preferred issuable upon the exercise of warrants to purchase Series A Preferred.
|--- | -------------------------------------------------------------------------------------------------------------------

|(10) | As described in a Schedule 13D/A (Amendment No. 10) filed with the Securities and Exchange Commission on December 18, 2008, AFB Fund, LLC (AFB) and Louis
Blumberg beneficially own, and have shared voting and dispositive power with respect to, 4,615,168 shares of Common Stock. Mr. Blumberg is deemed to beneficially own the 4,615,168 shares of Common Stock beneficially owned by AFB by virtue of
his role as manager of AFB. The principal business address of AFB and Mr. Blumberg is 2050 Center Avenue, Fort Lee, NJ 07024.
|---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(11) | Includes 4,180,602 shares of Common Stock issuable upon the conversion of shares of Series C Preferred. The business address of St. Jude Medical, Inc. is One Lillehei Plaza, St.
Paul, MN 55117.
|---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(12) | The information in the table and this note is derived from an amendment to a Schedule 13G/A (Amendment No. 2) filed with the Securities and Exchange Commission on
December 31, 2008 by Samana Capital, L.P., Morton Holdings, Inc., and Philip B. Korsant, which share the power to vote and dispose of the shares of Common Stock.
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(13) | Includes 441,168 shares of Common Stock issuable upon conversion of shares of Series A Preferred issuable upon the
exercise of Series A Preferred warrants. The business address of Leaf Offshore Investment Fund Ltd. is 515 Madison Avenue, 42ndFloor, New York, NY
10022.
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(14) | Includes 33,396 shares of Series A Preferred issuable upon the exercise of Series A Preferred warrants.
|---- | -------------------------------------------------------------------------------------------------------

|(15) | Includes 44,109 shares of Common Stock issuable upon the conversion of shares of Series A Preferred issuable upon the
exercise of Series A Preferred warrants. The business address of J. Leighton Read is c/o Alloy Ventures, 480 Cowper Street, 2ndFloor, Palo Alto, CA
94301.
|---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(16) | Includes 3,393 shares of Series A Preferred issuable upon the exercise of Series A Preferred warrants.
|---- | ------------------------------------------------------------------------------------------------------



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##### Table of Contents

|Item 13. | Certain Relationships and Related Transactions, and Director Independence
|-------- | -------------------------------------------------------------------------

Transactions with Related Persons

The Board of Directors of the Company reviews the material facts of transactions with a
related person that are required to be disclosed under Item 404(a) of Regulation S-K under the Securities Exchange Act of 1934, as amended. In general, that rule requires disclosure of any transaction in which the Company is a participant, the
aggregate amount involved exceeds $120,000, and any related person has or will have a direct or indirect material interest. A related person means any director or executive officer, any nominee for director, or any immediate family
member of a director or executive officer of the registrant, or of any nominee for director. In reviewing related party transactions, the Board will take into account, among other factors it deems appropriate, whether the related party transaction
is on terms no less favorable than terms generally available to an unaffiliated third-party under the same or similar circumstances and the extent of the related persons interest in the transaction. Related party transactions are referred to
the Board by management for review, approval, ratification or other action. This policy is not in writing but is followed consistently by the Board.

Settlement Agreement with AFB Fund, LLC, Louis Blumberg and Laurence Blumberg

On May 19, 2008, the Company entered
into a Settlement Agreement (the Settlement Agreement) with the AFB Fund, LLC (AFB), Louis Blumberg and Laurence Blumberg relating to AFBs stockholder proposal seeking stockholder approval of a recommendation to the
Companys Board of Directors that the Companys certificate of incorporation be amended to eliminate those provisions of the certificate of incorporation that provide for a staggered Board of Directors and to impose four-year term limits
upon director service on the Board of Directors and the nomination of Louis Blumberg by AFB to the Companys Board of Directors in lieu of one of the Board of Directors nominees.

In accordance with the terms of the Settlement Agreement, the Company expanded the size of the Board of Directors to create one new directorship and
appointed Louis Blumberg to the Board of Directors to fill the newly created vacancy. Under the Settlement Agreement, the Company agreed to submit and recommend a proposal to its stockholders at the Companys 2009 annual meeting of stockholders
to amend the Companys certificate of incorporation in order to eliminate the staggered Board of Directors. If the stockholders approve this amendment, the Company agreed that it will use all reasonable efforts to eliminate the staggered Board
at the Companys 2009 annual meeting of stockholders, which means that the terms of all directors would expire at the Companys 2009 annual meeting of stockholders and all directors would be elected at the 2009 annual meeting of
stockholders to serve until the Companys 2010 annual meeting of stockholders and until their successors are elected and qualified.

Under the Settlement Agreement, AFB agreed to terminate its potential proxy solicitation to elect Louis Blumberg as a member of the Board of Directors in lieu of a nominee recommended by the Board of Directors and to withdraw its
stockholder proposal seeking stockholder approval of a recommendation that the Board of Directors amend the Companys certificate of incorporation to eliminate the provisions providing for a staggered Board of Directors and to impose four-year
term limits upon director service on the Board of Directors. AFB, Louis Blumberg and Laurence Blumberg also agreed through the 2008 annual meeting of stockholders (the 2008 Meeting) not to conduct a proxy solicitation from the
Companys stockholders, otherwise engage in any course of conduct with the purpose of causing the stockholders to vote contrary to the recommendation of the Board of Directors on any matter presented to the stockholders for their vote, or
otherwise act, directly or indirectly, alone or in concert with others, to seek to control or influence the management, the Board of Directors, policies and affairs of the Company, other than through Louis Blumberg, in his capacity as a member of
the Board of Directors.

Under the Settlement Agreement, AFB, Louis Blumberg and Laurence Blumberg agreed to, and agreed to cause each of
their affiliates to, cause all voting securities of the Company beneficially owned by them to be present at the 2008 Meeting for the purpose of establishing a quorum and to be voted at the annual meeting (i) for



12



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##### Table of Contents

the director nominees recommended by the Board of Directors; (ii) for the other proposals set forth in the Proxy Statement for the 2008 Meeting; and
(iii) in accordance with the recommendation of the Board of Directors on any proposals of any other stockholder of the Company, including with regard to nomination of one or more nominees for election as director in opposition to the nominees
of the Board of Directors, at the 2008 Meeting.

Voting Agreement with Robert Khederian

On December 14, 2007, the Company entered into the Restated Voting Agreement with Mr. Khederian, in connection with the appointment of
Dr. Haghighi-Mood as the Companys President and Chief Executive Officer. The Restated Voting Agreement amended and restated the Voting Agreement dated October 29, 2007 with Mr. Khederian that was executed by the parties in
connection with the appointment to the Board of two new independent directors of the Company.

The Companys certificate of
incorporation provides that the holders of Series A Preferred, voting as a separate class, are entitled to elect up to four members of the Board and that at such time the total number of directors may not exceed nine. There are currently 154 shares
of Series A Preferred outstanding, all of which are held by Mr. Khederian. There also are an aggregate of 115,229 Series A Warrants currently outstanding. Mr. Khederian is the holder of record of 78,054 Series A Warrants, which together
with his Series A Preferred, represents approximately 67.6% of the outstanding Series A Preferred and Series A Warrants.

Under the
Restated Voting Agreement, Mr. Khederian agreed to hold and not transfer or otherwise dispose of any of the Series A Warrants registered in his name or any shares of Series A Stock that he may acquire upon exercise of his Series A Warrants if,
as a result of such transfer or disposition, he will not hold a majority of the Series A Preferred (assuming the exercise of all outstanding Series A Warrants). Mr. Khederian also agreed that upon the request of the Board he would exercise that
number of Series A Warrants so that he holds at least a majority of the shares of Series A Preferred then outstanding and entitled to vote. Mr. Khederian further agreed to vote all of his shares of Series A Preferred so as to elect up to three
individuals that are nominated or recommended for election as Series A Preferred directors by a majority of the Board, provided that, in the case of each such director, the Board has determined that such individual qualifies as an independent
director under the Nasdaq Marketplace Rules then in effect or such director is serving at the time of the election as the Chief Executive Officer of the Company.

On May 14, 2008, the Company and Mr. Khederian entered into Amendment No. 1 to the Amended and Restated Voting Agreement (the Amendment). Under the Amendment, Mr. Khederian agreed that,
upon the request of the Board of Directors, Mr. Khederian would vote all of his shares of Common Stock and all of his shares of Series A Preferred in favor of any amendment to the Companys certificate of incorporation in order to
eliminate the staggered Board of Directors and any amendment to the certificate of incorporation to eliminate the rights of the Series A Holders, as a separate class, to elect any members of the Board of Directors.

On May 31, 2008, the Company and Mr. Khederian entered into Amendment No. 2 to the Amended and Restated Voting Agreement. Under Amendment
No. 2, Mr. Khederian agrees to vote all of his shares of Series A Preferred so as to elect up to four individuals (increased from three under the prior Voting Agreement) who are nominated or recommended for election as Series A Preferred
directors by a majority of the Board, provided that, in the case of each such director, the Board has determined that such individual qualifies as an independent director under the Nasdaq Marketplace Rules then in effect or such director is serving
at the time of the election as the Chief Executive Officer of the Company.

Consulting and Technology Agreement with Richard J. Cohen, M.D., Ph.D.

The Company and Richard J. Cohen, M.D., Ph.D. are parties to a Consulting and Technology Agreement pursuant to which Dr. Cohen agreed
to provide consulting services and license certain technologies to the Company in exchange for compensation and the payment of certain royalties by the Company. In May 2007, the Company and Dr. Cohen entered into an Amended and Restated
Consulting and Technology Agreement with Dr. Cohen (the Amended Agreement), the material terms of which are described below.



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Under the terms of the Amended Agreement, during the period beginning January 1, 2007 and ending on
December 31, 2009 (the Interim Consulting Period), Dr. Cohen agrees to be available to the Company for consultation for up to 42 days per year. Thereafter, Dr. Cohen agrees to be available to the Company for consultation
for a minimum of 18 days per year until the expiration of the consulting period on December 31, 2015 (the Additional Consulting Period).

The Company will continue to pay Dr. Cohen royalties on net sales related to certain technologies (including the sale of the Companys HearTwave II System and other Microvolt T-Wave Alternans products) equal
to 1.5% of such net sales. If the Company sublicenses, or grants rights to any sublicense with respect to, such technologies to an unrelated company, Dr. Cohen shall receive royalties equal to 7% of gross revenue to the Company from the
sublicense. Pursuant to the terms of the Amended Agreement, the Company will pay Dr. Cohen additional royalties of $10,000 per month during the Interim Consulting Period, subject to an annual percentage increase equal to the annual percentage
increase in the National Consumer Price Index for the prior year. In 2008, the Company paid Dr. Cohen approximately $171,951 in royalties under the Amended Agreement. Under the Amended Agreement, Dr. Cohen received in May 2007, as
compensation for his consulting effort, an aggregate of 175,000 shares of restricted common stock of the Company subject to the terms and conditions of the Companys 2001 Stock Incentive Plan. Dr. Cohen will not receive any additional
compensation for the Additional Consulting Period.

Under the Amended Agreement, the Company will have the right to terminate the Amended
Agreement within the 30-day period immediately following a Change in Control (as defined in the Amended Agreement) of the Company, in which case the Company shall pay Dr. Cohen a termination royalty as determined in the Amended Agreement.
Either party may terminate the Amended Agreement for material breach or default by the other party of the other partys obligations under the Amended Agreement upon 90 days notice.

Director Independence

The Board has determined that
Messrs. Hachikian, Wiggins, Malleck and McGuire are independent directors, as defined by the rules of The Nasdaq Stock Market. The Board of Directors has established three standing committeesAudit, Compensation, and Nominating and Governance.
The Audit and Nominating and Governance Committees each operate under a charter that has been approved by the Board. Current copies of the charters of the Audit and Nominating and Governance Committees are posted in the Corporate Governance section
of the Companys website at www.cambridgeheart.com.

The members of the Audit Committee are Mr. McGuire (Chairman),
Mr. Wiggins and Mr. Malleck. The Board of Directors has determined that all members of the Audit Committee are independent as determined under Rule 10A-3 promulgated under the Securities Exchange Act of 1934 and as defined by the rules of
The Nasdaq Stock Market.

The members of the Compensation Committee are Mr. Hachikian (Chairman), Mr. Malleck and
Mr. McGuire. All members of the Compensation Committee are independent as defined under the rules of The Nasdaq Stock Market.

The
members of the Nominating and Governance Committee are Mr. Wiggins (Chairman), Mr. McGuire and Mr. Hachikian. All members of the Nominating Committee are independent as defined under the rules of The Nasdaq Stock Market.



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|Item 14. | Principal Accountant Fees and Services
|-------- | --------------------------------------

Independent
Auditors Fees

The following table summarizes the fees of Vitale, Caturano & Company, PC billed to the Company for each
of the last two fiscal years for audit services and billed to the Company in each of the last two fiscal years for other services:



|                   |  |      |         |     |      |   |        
|------------------ |  | ---- | ------- | --- | ---- | - | -------
|Fee Category       |  | 2008 |         |     | 2007
|Audit Fees         |  | $    | 125,000 |     |      | $ | 117,867
|Audit-Related Fees |  | $    | 6,050   | (1) |      | $ |       
|All Other Fees     |  | $    |        |     |      | $ |       
|Total Fees         |  | $    | 131,050 |     |      | $ | 117,867

| | 
| | 

| | (1) | Consists of fees related to SEC filings and accounting consultation.
| | --- | --------------------------------------------------------------------

Pre-Approval Policies and Procedures

The Audit Committee has adopted policies and procedures relating to the approval of
all audit and non-audit services that are to be performed by the Companys independent auditor. This policy generally provides that the Company will not engage its independent auditor to render audit or non-audit services unless the service is
specifically approved in advance by the Audit Committee or the engagement is entered into pursuant to one of the pre-approval procedures described below.

From time to time, the Audit Committee may pre-approve specified types of services that are expected to be provided to the Company by its independent auditor during the next 12 months. Any such pre-approval is
detailed as to the particular service or type of services to be provided and is also generally subject to a maximum dollar amount.

The
Audit Committee has also delegated to the chairman of the Audit Committee the authority to approve any audit or non-audit services to be provided to the Company by its independent auditor. Any approval of services by a member of the Audit Committee
pursuant to this delegated authority is reported on at the next meeting of the Audit Committee.

There were no audit or non-audit services
provided to the Company for the fiscal year ended December 
31, 2008 that were not approved by the Audit Committee or its chairman.

PART IV



|Item 15. | Exhibits, Financial Statement Schedules
|-------- | ---------------------------------------



|(b) | The following exhibits are filed as part of this Report on Form 10-K/A:
|--- | -----------------------------------------------------------------------



|        |  |                                                                                                   
|------- |  | --------------------------------------------------------------------------------------------------
|Exhibit |  | Description                                                                                       
|        | 
|31.1    |  | Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|        | 
|31.2    |  | Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002



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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized, on April 30, 2009.



CAMBRIDGE HEART, INC.By:

/s/    ALI HAGHIGHI-MOODAli Haghighi-Mood President and Chief Executive Officer


Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this report
has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.



|                                           |  |                                                                      |  |               
|------------------------------------------ |  | -------------------------------------------------------------------- |  | --------------
|Signature                                  |  | Title                                                                |  | Date          
|                                           |  |                                                                     
|/s/    ALI
HAGHIGHI-MOOD Ali Haghighi-Mood |  | President and Chief Executive Officer (Principal Executive Officer)  |  | April 30, 2009
|                                           |  |                                                                     
|/s/    VINCENZO
LICAUSI Vincenzo LiCausi   |  | Chief Financial Officer (Principal Financial and Accounting Officer) |  | April 30, 2009



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EXHIBIT INDEX



|            |  |                                                                                                   
|----------- |  | --------------------------------------------------------------------------------------------------
|Exhibit No. |  | Description                                                                                       
|31.1        |  | Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|            | 
|31.2        |  | Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002