Use these links to rapidly review the documentTABLE OF CONTENTS

Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

FORM 10-K/A

ý

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended December 31, 2012ORTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the transition period from N/A to N/A


Commission file number: 0-10961

CardioNet, Inc.(Exact name of registrant as specified in its charter)

DELAWARE(State or other jurisdiction of
incorporation or organization)

94-2573850(I.R.S. Employer
Identification No.)227 Washington Street
Conshohocken, Pennsylvania(Address of principal executive offices)

19428(Zip Code)


(610) 729-7000(Registrant's telephone number, including area code)

Not Applicable(Former name, former address and former fiscal year, if changed since last report)

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

Title of Each Class

Name of Each Exchange on Which RegisteredCommon Stock, $0.001 par value

NASDAQ Stock Market LLC


Securities
registered pursuant to Section 12(g) of the Act:None

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

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

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 ý    No o

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 (§ 229.405 of this chapter) during the preceding 12 months (or for such shorter period
that the registrant was required to submit and post such
files). Yes ý    No o

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. ý

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. (Check one):

Large accelerated filer o

Accelerated filer o

Non-accelerated filer o (Do not check if a
smaller reporting company)

Smaller reporting company ý


Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act). Yes o    No ý

The aggregate market value of the registrant's common stock held by non-affiliates of the registrant was $34,525,117 based on the closing sale price at
which the common stock was last sold on June 29, 2012, the last business day of the registrant's most recently completed second fiscal quarter.

As
of April 25, 2013, 25,380,657 shares of the registrant's common stock were outstanding.

DOCUMENTS INCORPORATED BY REFERENCENone





---





Table of Contents



CardioNet, Inc.  Annual Report on Form 10-K/A  For The Fiscal Year Ended December 31, 2012

TABLE OF CONTENTS



PagePART IIIItem 10.

Directors, Executive Officers and Corporate Governance


4Item 11.

Executive Compensation


14Item 12.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters


35Item 13.

Certain Relationships and Related Transactions, and Director Independence


36Item 14.

Principal Accountant Fees and Services


38PART IVItem 15.

Exhibits and Financial Statement Schedules


39Exhibit Index


39Signatures


42


2

---





Table of Contents

EXPLANATORY NOTE

CardioNet, Inc. (the "Company," "we," "us" or "our") is filing this Amendment No. 1 on Form 10-K/A
(this "Amendment") to its Annual Report on Form 10-K for the year ended December 31, 2012 (the "Original Filing" or "Form 10-K"), which was originally
filed with the Securities and Exchange Commission (the "SEC") on February 22, 2013 solely to include the information required in Part III (Items 10, 11, 12, 13 and 14) of
Form 10-K that was previously omitted from the Original Filing. Except as expressly set forth herein, this Amendment does not reflect events occurring after the date of the Original
Filing or modify or update any of the other disclosures contained therein in any way. Accordingly, this Amendment should be read in conjunction with the Original Filing and the Company's other filings
with the SEC. This Amendment consists solely of the preceding cover page, this explanatory note, Part III (Items 10, 11, 12, 13 and 14), the signature page, the exhibits to this
Amendment and the certifications required to be filed as exhibits to this Amendment.

3

---





Table of Contents

Part III

Item 10.    Directors, Executive Officers and Corporate Governance

Directors and Executive Officers

The following table sets forth the name, age and principal occupation of, and other information regarding each of our current
directors.

Name

Age

PositionDirectors:Eric N. Prystowsky, M.D.(2)(3)


65

DirectorRebecca W. Rimel(2)


61

DirectorRobert J. Rubin, M.D.(1)(3)


67

DirectorRonald A. Ahrens(2)(3)


73

DirectorJoseph H. Capper


49

Director, President and Chief Executive OfficerKirk E. Gorman(1)


62

Director and ChairmanAnthony J. Conti(1)


64

Director


(1)Member
of the Audit Committee.(2)Member
of the Compensation Committee.(3)Member
of the Nominating and Corporate Governance Committee.


Rebecca W. Rimel.Ms. Rimel has been a member of our Board of Directors since May 2009. She joined The Pew Charitable Trusts
in 1983 as Health
Program Manager and has led the organization as Executive Director from 1988 through 1994 and in her current position as President and Chief Executive Officer since 1994. From 1981 through 1983,
Ms. Rimel served as Assistant Professor in the Department of Neurosurgery at the University of Virginia Hospital. Along with additional teaching and practitioner positions at the University of
Virginia Hospital, she also held the title of Head Nurse of the medical center's emergency department. Ms. Rimel serves as a member of the Board of The Pew Charitable Trusts, and on the Boards
of DWS Mutual Funds and Becton Dickenson & Company Ms. Rimel brings to the Company a superior reputation for leadership and experience in the clinical, academic and business sectors of
the healthcare industry. She has had, and continues to build, an exemplary career in public policy, non-profit administration, advocacy and innovation related to the healthcare field.
Ms. Rimel received her Bachelor of Science from the University of Virginia School of Nursing, and earned a Master of Business Administration degree from James Madison University.
Ms. Rimel's education and professional experience serves as a basis for her contributions, past and present, as a member of the board of directors for various public and private companies.

Eric N. Prystowsky, M.D.Dr. Prystowsky has been a member of our Board of Directors since March 2001. Since 1988,
Dr. Prystowsky has
served as the Director, Clinical Electrophysiology Laboratory at St. Vincent Hospital, Indianapolis, Indiana. Since 1988, Dr. Prystowsky has served as Consulting Professor of Medicine at
Duke University. Since 2004, he has served as the associate editor of Hurst Textbook of Cardiology and, since January 2004, he has served as editor-in-chief of the Journal of
Cardiovascular Electrophysiology. From 1992 to 1994, he served as the Chairman of the American Heart Association's Committee on Electrocardiography and Electrophysiology and, from May 2001 to May
2002, as President of the Heart Rhythm Society. Dr. Prystowsky also served as the Chairman of the ABIM test writing committee for
the Electrophysiology Boards until July 2008. Dr. Prystowsky currently serves on the Board of Directors of Stereotaxis, Inc., a biotechnology company. Dr. Prystowsky received an
undergraduate degree from the Pennsylvania State University and an M.D. from the Mount Sinai School of Medicine. Dr. Prystowsky brings relevant real-time clinical and academic
experience as a published and renowned electrophysiologist with St. Vincent Hospital

4

---



Table of Contents

and
Consulting Professor at Duke University. Dr. Prystowsky's knowledge of and experience with cardiac medicine is vast and includes leading positions within the American Heart Association as
well as the Heart Rhythm Society. Dr. Prystowsky also brings to the Board of Directors specific experience in serving as a board member of another company.

Robert J. Rubin, M.D.Dr. Rubin has been a member of our Board of Directors since July 2007. He was a clinical professor of
medicine at
Georgetown University from 1995 until 2012 when he was appointed a Distinguished Professor of Medicine. From 1987 to 2001, he was president of the Lewin Group (purchased by Quintiles Transnational
Corp. in 1996), a national health policy and management consulting firm. From 1994 to 1996, Dr. Rubin served as Medical Director of ValueRx, a pharmaceutical benefits company. From 1992 to
1996, he served as President of Lewin-VHI, a healthcare consulting company. From 1987 to 1992, he served as President of Lewin-ICF, a healthcare consulting company. From 1984
to 1987, Dr. Rubin served as a principal of ICF, Inc., a healthcare consulting company. From 1981 to 1984, he served as the Assistant Secretary for Planning and Evaluation at the
Department of Health and Human Services and as an Assistant Surgeon General in the United States Public Health Service. Dr. Rubin serves as a member of the Board of Directors of
Soligenix, Inc. He is a board certified nephrologist and internist. He received an undergraduate degree in Political Science from Williams College and an M.D. from Cornell University.
Dr. Rubin brings over 30 years of specific experience as a professor, policy maker, clinician and business professional dedicated to the medical profession. His specific experience with
the United States Department of Health and Human Services and Assistant Surgeon General is a unique and invaluable qualification, which lends insight into governmental practice, policy making and
regulation. Dr. Rubin's extensive and diverse background in education, government and business allows him to serve as a resource on a broad spectrum of matters.

Joseph H. Capper.Mr. Capper has been our President and Chief Executive Officer and a member of our Board of Directors
since June 2010.
Mr. Capper has served as President, Chief Executive Officer and a member of the Board of Directors of Home Diagnostics, Inc., a leading developer, manufacturer and marketer of diabetes
management products. Mr. Capper joined Home Diagnostics in 2009. Home Diagnostics was listed on NASDAQ until its strategic merger. Prior to joining Home Diagnostics, from 2002 to 2009,
Mr. Capper was President and Chief Executive Officer of CCS Medical Inc., a private company that is a leading provider of medical supplies in diabetes, wound care, respiratory and other
therapeutic categories. Earlier in his career, Mr. Capper spent nine years with Bayer Corporation, ultimately becoming National Sales Director of the Diabetic Products Division.
Mr. Capper also served in the U.S. Navy as a combat aviator and subsequently as a Congressional Liaison. Mr. Capper received an undergraduate degree in Accounting from West Chester
University and a Master of Business Administration degree in International Finance from George Washington University. Mr. Capper brings an extensive amount leadership and diverse experience in
public and private companies.

Ronald A. Ahrens.Mr. Ahrens has been a member of our Board of Directors since August 2008 and Chairman of our Compensation
Committee since
December 2009. From 2004 to the present, Mr. Ahrens has served as the Vice Chairman of the Board of Directors and as a member of the Compensation Committee of Temptime Corporation, a healthcare
technology company. Previously, he served as a member of the Board of Directors and Chairman of the Compensation Committee of VIASYS Healthcare Inc., a global medical technology company, from
November 2001 until its acquisition in July 2007 for $1.5 billion by Cardinal Health. Mr. Ahrens' past experience includes serving as Chairman of the Board of Directors of Closure
Medical Corporation, a medical devices corporation, from 1999 through June 2004, St. Ives Laboratories, Inc., a hair and skin care company from 1995 to 1997 and from 1990 to 1993 as a
member of the Board of Directors of Alcide Corporation, an animal healthcare technology company. Earlier in his career, Mr. Ahrens held various positions with Merck & Co, Inc. a
global pharmaceuticals products company, including President of Merck Consumer Healthcare Group Worldwide and Executive Vice President of Merck Consumer

5

---



Table of Contents

Healthcare
Group International. Mr. Ahrens received an undergraduate degree in English from Concordia College and a Masters in Sacred Theology from Concordia Seminary. Mr. Ahrens is a
veteran of the healthcare industry and brings to the Board over forty years of senior executive and management experience with both public and private pharmaceutical and device companies. He has also
established a strong track record of serving and consulting for significant public and private company board of directors. Mr. Ahrens' breadth of knowledge and hands-on business
experience provides him with the necessary skill to serve as the Chairman of the Compensation Committee for our Board of Directors and to easily relate to and act as a liaison between other members of
the Board and executives within the Company.

Anthony J. Conti.Mr. Conti joined the CardioNet board of directors in May 2012, serving as the Chairman of its Audit
Committee. He joined
Coopers and Lybrand in 1973 and served a wide range of technology, utility and health services clients. He held a number of leadership roles with Coopers and Lybrand, and later with
PricewaterhouseCoopers, after its merger with Price Waterhouse in 1998. Mr. Conti serves as the Chairman of the Audit Committee for Ametek, Inc., an electronic instrument and
electromechanical device company. He previously served as Chairman of the Board of the World Affairs Council of Philadelphia until December of 2011, and now serves as Chairman Emeritus. He
also served as a Member of the Board and Executive Committee of the United Way of Southeastern Pennsylvania. Mr. Conti holds a Bachelors of Arts degree in Economics from St. Joseph's
University and a Master of Business Administration degree from Temple University. Mr. Conti's extensive background as independent accountant, together with his experience as an audit committee
member makes him uniquely suited to be our audit committee chairman.

Kirk E. Gorman.Mr. Gorman has been a member of our Board of Directors since August 2008 and our Chairman since October
2011.
Mr. Gorman has served as the Executive Vice President, Chief Financial Officer of Jefferson Health System, a hospital system in Philadelphia, Pennsylvania since September 2003.
Mr. Gorman has also been a member of the Board of Directors and Audit Committee of IASIS Healthcare LLC since February 2004. From April 1987 to March 2003, Mr. Gorman served as
the Senior Vice President, Chief Financial Officer of Universal Health Services, Inc., a hospital management company and President, Chief Financial Officer and a member of the Board of Trustees
of Universal Health Realty Income Trust, a real estate investment trust specializing in healthcare and human service related facilities. From June 2007 to October 2009, he also served on the board of
Care Investment Trust, a real estate investment trust. From November 2001 to December 2003, and from February 2005 until its acquisition by Cardinal Health, Inc. in July 2007, Mr. Gorman
served as a member of the Board of Directors of VIASYS Healthcare, Inc. a healthcare technology company. Mr. Gorman received an undergraduate degree from Dartmouth College and a Master
of Business Administration degree from the Amos Tuck School of Business. Mr. Gorman brings extensive financial knowledge and experience as the Chief Financial Officer of numerous healthcare
related companies, including Jefferson Health System, the largest hospital system in Philadelphia. His specific and ongoing healthcare related financial experience with reimbursement, tax, accounting,
and financial and strategic planning is especially valuable to the Company. Mr. Gorman also brings significant public company board of director and audit committee experience.

6

---



Table of Contents

EXECUTIVE OFFICERS

The following table sets forth information regarding our executive officers

Name

Age

PositionExecutive Officers:Joseph H. Capper


49

Director, Chairman, President and Chief Executive OfficerHeather C. Getz, CPA


38

Senior Vice President and Chief Financial OfficerMichael Geldart


50

Senior Vice President, Strategy and Business DevelopmentPeter Ferola


44

Senior Vice President, Corporate Development, General Counsel, SecretaryAnna McNamara, RN


65

Senior Vice President, Clinical OperationsFred (Andy) Broadway III


43

Senior Vice President, Sales and MarketingDaniel Wisniewski


49

Senior Vice President, Business OperationsGeorge Hrenko


50

Senior Vice President, Human Resources and Organizational Excellence


Biographical Information for Executive Officers

Joseph H. Capper.Mr. Capper was appointed President and Chief Executive Officer and a member of the Board of Directors of
CardioNet in June
2010. Prior to joining CardioNet, Mr. Capper served as President, Chief Executive Officer and a member of the Board of Directors of Home Diagnostics, Inc., a leading developer,
manufacturer and marketer of diabetes management products. Mr. Capper joined Home Diagnostics in 2009 and positioned the Company for a strategic merger in a transaction that created substantial
value to its stockholders. Home Diagnostics was listed on the NASDAQ until its strategic merger. Prior to joining Home Diagnostics, from 2002 to 2009, Mr. Capper was President and Chief
Executive Officer of CCS Medical Inc., a private company that is a leading provider of medical supplies in diabetes, wound care, respiratory and other therapeutic categories. Earlier in his
career, Mr. Capper spent nine years with Bayer Corporation, ultimately becoming National Sales Director of the Diabetic Products Division. Mr. Capper also has a distinguished service
record having served in the U.S. Navy as a combat aviator and subsequently as a Congressional Liaison. Mr. Capper received an undergraduate degree in Accounting from West Chester University and
a Master of Business Administration degree in International Finance from George Washington University.

Heather C. Getz, CPA.Ms. Getz was appointed Senior Vice President and Chief Financial Officer in January 2010.
Ms. Getz joined
CardioNet in May 2009 as Vice President of Finance. From April 2008 to May 2009, Ms. Getz was Vice President of Finance at Alita Pharmaceuticals, Inc., a privately held specialty
pharmaceutical company, where she was responsible for all areas of finance, accounting and information systems. Prior to joining Alita Pharmaceuticals, Inc., from March 2002 to April 2008,
Ms. Getz held various financial leadership positions at VIASYS Healthcare Inc., a healthcare technology company, including directing the company's global financial planning, budgeting
and analysis, and external reporting functions. From June 1997 to February 2002, Ms. Getz began her career at Sunoco, Inc., where she held various positions of increasing responsibility.
Ms. Getz is a certified public accountant, and received her undergraduate degree in Accountancy and a Master of Business Administration degree from Villanova University.

Peter Ferola.Mr. Ferola joined CardioNet in February 2011 as its Senior Vice President, Corporate Development and General
Counsel, with over
20 years of progressive leadership experience in business management, legal affairs and corporate governance. From 2009 to 2011, Mr. Ferola served as Vice President, General Counsel and
Secretary of Nipro Diagnostics, Inc. (formerly Home Diagnostics, Inc., NASDAQ: HDIX). Prior to joining Home Diagnostics, Mr. Ferola worked as a

7

---



Table of Contents

corporate
and securities attorney with Greenberg Traurig, LLP and with Dilworth Paxson, LLP in Washington, D.C. focusing on mergers, acquisitions, public securities offerings and
corporate governance matters. From 1989 to 2002, Mr. Ferola worked in executive management roles for an American Stock Exchange-listed company, most recently serving as Vice
PresidentAdministration and Corporate Secretary, overseeing the Company's administrative functions, legal matters and investor relations. Mr. Ferola earned a Bachelor of Science
and Juris Doctor degree from Nova Southeastern University and a Master of Laws in Securities and Financial Regulation from Georgetown University Law Center. Mr. Ferola has authored numerous
articles on corporate and securities laws, with a particular focus on audit committees and regulations implemented in the wake of the Sarbanes-Oxley Act of 2002.

Michael Geldart.Michael Geldart joined CardioNet in June 2012 as its Senior Vice President, Corporate Strategy and Business
Development. Michael has
more than 20 years of experience in executive leadership, health law and corporate development. Most recently, from May 2011 until coming to CardioNet in June of 2012, Michael worked as a
consultant with numerous companies on strategic business planning and compliance matters through his sole proprietor consulting business, Geldart Consulting, LLC. From October 2009 to April
2011, Mr. Geldart was the Chief Operating Officer of MedExpress, a leading multi-state Urgent Care provider. Prior to joining MedExpress, from July 2002 to September, 2009, Michael was the
Chief Operating Officer and Executive Vice President of Corporate Development of CCS Medical. Prior to joining CCS Medical, Michael was a partner at Holland & Knight, LLP, a global law
firm, where he most recently served as the Co-Chair of the firm's National Health Care Practice Group. Michael received a Bachelor of Arts in Chemistry from the University of South
Florida, and a Juris Doctor degree from Stetson University College of Law. Michael is a member of the Florida Bar.

Anna McNamara, RN.Ms. McNamara joined CardioNet in 2002 serving in various Clinical Operations roles. She currently serves
as our Senior Vice
President, Clinical Operations. From February 2001 to September 2002, Ms. McNamara served as Executive Vice President of Clinical Operations for LifeWatch Corp., a healthcare services company.
From July 1998 to February 2001, Ms. McNamara served as Vice President of Clinical Operations for Quality Diagnostic Services at Matria
Healthcare, Inc., a healthcare company. From January 1997 to July 1998, Ms. McNamara served as Vice President of Clinical Operations for WebMD Health Corp., a web-based
health information provider. Ms. McNamara received an undergraduate degree in Nursing from Marymount College and worked as a Registered Nurse at Mercy Hospital in Scranton, Pennsylvania.

Fred (Andy) Broadway III.Andy Broadway joined CardioNet in June 2009 as its Vice President, Marketing, bringing 15 years
of progressive
leadership experience in sales and marketing, including extensive therapeutic knowledge in Cardiology and Neurology. In September 2012, Mr. Broadway was promoted to Senior Vice President,
Marketing, and in January 2013, Mr. Broadway became CardioNet's Senior Vice President, Sales and Marketing. Prior to joining CardioNet, from 2006 to June 2009, Andy was Director of Marketing at
Bristol-Myers Squibb, leading the commercialization launch efforts of a potential new therapy for the treatment of stroke prevention in atrial fibrillation. Earlier in his career, Andy was on the
marketing team at Pfizer, responsible for developing yearly and long term strategic plans, brand and portfolio positioning, asset/life/cycle development, and overseeing commercialization tactics for
several leading brands. Andy started his career with Sanofi Pharmaceuticals, where he held numerous positions of increasing responsibility including sales, marketing, and eventually leadership
positions in both sales and marketing. Andy received his undergraduate degree in Zoology from Auburn University.

8

---





Table of Contents

Daniel Wisniewski.Mr. Wisniewski joined CardioNet in December 2010 as its Senior Vice President, Operations, with over
20 years of
experience in executive leadership, information systems, and operations. Most recently, from 2000 to 2010, Mr. Wisniewski served as Chief Information Officer with CCS Medical, Inc. As
the Chief Information Officer, Mr. Wisniewski was responsible for developing a highly scalable patient centric operational infrastructure focused on compliance, growth and expense control
within the healthcare industry. Prior to joining CCS Medical, Inc., Mr. Wisniewski held various roles within the nuclear and banking industries with increasing responsibilities in
information systems and general management. Mr. Wisniewski began his career as an U.S. Navy Nuclear Trained Naval Officer. Mr. Wisniewski received his undergraduate degree in Electrical
Engineering from Virginia Military Institute.

George Hrenko.Mr. Hrenko joined CardioNet in 2008 as its VP of Human Resources and was named Senior Vice President, Human
Resources and
Organizational Excellence in May 2010. Most recently, Mr. Hrenko served as a Director of Human Resources for Target Corporation from February 2002 to March 2007. From December 1998 to February
2002, Mr. Hrenko held several positions with Bank One Corporation, including First Vice President, Human Resources Generalist, Vice President, Compensation, and Vice President, Corporate
Staffing. From 1996 to 1998 he served as Managing Director, Human Resources for Continental Airlines. Prior to joining Continental Airlines, Mr. Hrenko served as Human Resources Manager at
Pepsi-Cola Co. and PepsiCo, Inc., from 1987 to
1996. Mr. Hrenko received an undergraduate degree in English and Psychology from Penn State University.

CORPORATE GOVERNANCE

Highlights of our corporate governance practices are described below.

INFORMATION REGARDING COMMITTEES OF THE BOARD OF DIRECTORS

During the year ended December 31, 2012, the Board of Directors of CardioNet maintained three committees; the Audit Committee,
the Compensation Committee and the Nominating and Corporate Governance Committee. The following table provides membership information for each of the committees of the Board of Directors as of
May 28, 2013:

Name

Audit

Compensation

Nominating
and
Corporate
GovernanceRonald A. Ahrens





X
*

XAnthony J. Conti


X
*Kirk E. Gorman


XEric N. Prystowsky, M.D.





X


XRebecca W. Rimel





XRobert J. Rubin, M.D.


X





X
*


*Committee
Chairperson


Below
is a description of each committee of the Board of Directors as such committees have been constituted during the year ended December 31, 2012, and are presently constituted.
The Board of Directors has determined that each current member of each committee meets the applicable SEC and NASDAQ rules and regulations regarding "independence" and that each member is free of any
relationship that would impair his or her individual exercise of independent judgment with regard to the Company.

9

---



Table of Contents

Audit Committee

The Audit Committee of the Board of Directors was established by the Board of Directors in accordance with Section 3(a)(58)(A)
of the Exchange Act to oversee the Company's corporate accounting and financial reporting processes and audits of its financial statements. The Board of Directors has adopted an Audit Committee
Charter which is available on our website athttp://investors.cardionet.com.The functions of this committee include, among other
things:



Both
our independent registered public accounting firm and management periodically meet privately with our Audit Committee.

Our
Audit Committee currently consists of Messrs. Conti, Gorman and Dr. Rubin, each of whom is a non-employee director of our Board of Directors.
Mr. Conti is currently the Chairman of our Audit Committee. Mr. Conti joined the Committee in May 2012. The Audit Committee met five (5) times in 2012. The Board of Directors
reviews the NASDAQ listing standards' definition of independence for Audit Committee members on an annual basis and has determined that all current members of the Company's Audit Committee are
independent (as independence is currently defined in Rule 5605(a)(2) and IM-5605 of the NASDAQ listing standards and Rule 10A-3 under the Exchange Act). The Board
of Directors has determined that Anthony J. Conti is a financial expert as defined in Item 407(d)(5)(ii) of Regulation S-K of the Exchange Act.

Compensation Committee

The Compensation Committee currently consists of three directors, Mr. Ahrens, the Chairman of the Compensation Committee,
Dr. Prystowsky and Ms. Rimel. All members of the Company's Compensation Committee are independent (as independence is currently defined in Rule 5605(a)(2), IM-5605 and
Rule 5605(d)(2) of the NASDAQ listing standards and Section 162(m) of the Internal Revenue Code. In 2012, the Compensation Committee met three (3) times.

The
Board of Directors has adopted a Compensation Committee Charter which was revised as of January 22, 2009 and is available on our website at http://investors.cardionet.com

The
Compensation Committee of the Board of Directors acts on behalf of the Board of Directors to review, recommend for adoption, and oversee the Company's compensation strategy,
policies, plans and programs, including:



10

---



Table of Contents



Typically,
the Compensation Committee meets quarterly and with greater frequency if necessary. The agenda for each meeting is usually developed by the Chair of the Compensation
Committee. The Compensation Committee meets regularly in executive session. However, from time to time, various members of management and other employees as well as outside advisors or consultants may
be invited by the Compensation Committee to make presentations, provide financial or other background
information or advice or otherwise participate in Compensation Committee meetings. The Chief Executive Officer may not participate in or be present during any deliberations of the Compensation
Committee regarding his compensation. The charter of the Compensation Committee grants the Compensation Committee full access to all books, records, facilities and personnel of the Company, as well as
authority to obtain, at the expense of the Company, advice and assistance from internal and external legal, accounting or other advisors and consultants and other external resources that the
Compensation Committee considers necessary or appropriate in the performance of its duties.

Our
Compensation Committee retains the services of third party executive compensation specialists and consultants from time to time, as it sees fit, in connection with the establishment
of cash and equity compensation and related policies.

The
specific recommendations of the Compensation Committee with respect to executive compensation for the year ended December 31, 2012 are described in greater detail in the
Compensation Discussion and Analysis section of this proxy statement/prospectus.

Compensation Committee Interlocks and Insider Participation

As indicated above, Mr. Ahrens, Ms. Rimel and Dr. Prystowsky currently serve, and previously served during 2012,
as members of the Compensation Committee. No member of the Compensation Committee has ever been an executive officer or employee of the Company. None of our officers

11

---



Table of Contents

currently
serves, or has served during the last completed year, on the Compensation Committee or the Board of Directors of any other entity that has one or more officers serving as a member of the
Board of Directors or the Compensation Committee.

Nominating and Corporate Governance Committee

The Nominating and Corporate Governance Committee currently consists of three directors, Dr. Rubin, the Chairman of the
Nominating and Corporate Governance Committee, Mr. Ahrens and Dr. Prystowsky. During 2012, the Nominating and Corporate Governance Committee met one (1) time. The Board of
Directors has adopted a Nominating and Corporate Governance Committee Charter which is available on our website athttp://investors.cardionet.com.All
members of the Nominating and Corporate Governance Committee are independent (as independence is currently defined in Rule 5605(a)(2) and IM-5605 of the NASDAQ listing standards).

The
functions of the Nominating and Corporate Governance Committee include, among other things:



The
Nominating and Corporate Governance Committee believes that candidates for director should have certain minimum qualifications, including the ability to read and understand basic
financial statements, being over 21 years of age and having the highest personal integrity and ethics. The Nominating and Corporate Governance Committee also intends to consider such factors as
possessing relevant expertise upon which to be able to offer advice and guidance to management, having sufficient time to devote to the affairs of the Company, demonstrated excellence in his or her
field, having the ability to exercise sound business judgment and having the commitment to rigorously represent the long-term interests of the Company's stockholders. However, the
Nominating and Corporate Governance Committee retains the right to modify these qualifications from time to time. Candidates for director nominees are reviewed in the context of the current
composition of the Board of Directors,

12

---



Table of Contents

the
operating requirements of the Company and the long-term interests of stockholders. In conducting this assessment, the Nominating and Corporate Governance Committee considers diversity,
age, skills, and such other factors as it deems appropriate given the current needs of the Board of Directors and the Company, to maintain a balance of knowledge, experience and capability.

The
Nominating and Corporate Governance Committee places a high priority on identifying individuals with diverse skill sets and types of experience including identification of
individuals from among the medical professional and medical device communities. In the case of incumbent directors whose terms of office are set to expire, the Nominating and Corporate Governance
Committee reviews these directors' overall service to the Company during their terms, including the number of meetings attended, level of participation, quality of performance, and any other
relationships and transactions that might impair the directors' independence. In the case of new director candidates, the Nominating and Corporate Governance Committee also determines whether the
nominee is independent for NASDAQ purposes, which determination is based upon applicable NASDAQ listing standards, applicable SEC rules and regulations and the advice of counsel, if necessary. The
Nominating and Corporate Governance Committee then uses its network of contacts to compile a list of potential candidates, but may also engage, if it deems appropriate, a professional search firm. The
Nominating and Corporate Governance Committee conducts any appropriate and necessary inquiries into the backgrounds and qualifications of possible candidates after considering the function and needs
of the Board of Directors. The Nominating and Corporate Governance Committee meets to discuss and consider the candidates' qualifications and then selects a nominee by majority vote.

The
Nominating and Corporate Governance Committee will consider director candidates recommended by stockholders. The Nominating and Corporate Governance Committee does not intend to
alter the manner in which it evaluates candidates, including the minimum criteria set forth above, based on whether or not the candidate was recommended by a stockholder. Stockholders who wish to
recommend individuals for consideration by the Nominating and Corporate Governance Committee to become nominees for election to the Board of Directors for the 2014 Annual Meeting of Stockholders may
do so by delivering a written recommendation to the Nominating and Corporate Governance Committee on or before February 21, 2014 at the following address: 227 Washington Street #210,
Conshohocken, Pennsylvania 19428, Attn: Secretary. Submissions must include the full name of the proposed nominee, a description of the proposed nominee's business experience for at least the previous
five years, complete biographical information, a description of the proposed nominee's qualifications as a director and the name of the nominating stockholder, a representation that the nominating
stockholder is a beneficial or record holder of the Company's stock and has been a holder for at least one year. Any such submission must be accompanied by the written consent of the proposed nominee
to be named as a nominee and to serve as a director if elected.

CODE OF ETHICS

The Company has adopted the CardioNet, Inc. Code of Business Conduct and Ethics that applies to all officers, directors and
employees, which was amended and updated to reflect current business practice and industry regulation on January 22, 2009. We intend to maintain the highest standards of ethical business
practices and compliance with all laws and regulations applicable to our business. The Code of Business Conduct and Ethics is available on our website at http://investors.cardionet.com.If the Company
makes any substantive amendments to the Code of Business Conduct and Ethics or grants any waiver from a
provision of the Code to any executive officer or director, the Company will promptly disclose the nature of the amendment or waiver on its website at http://investors.cardionet.com.

13

---



Table of Contents

Item 11.    Executive Compensation

Compensation Discussion and Analysis



In this Compensation Discussion and Analysis, we address the compensation provided to our named executive officers listed below under
"Our Named Executive Officers" and in the Summary Compensation Table that follows this discussion, the goals that we seek to achieve through our executive compensation program and other important
factors underlying our compensation practices and policies.

2012
has been another challenging year for us with mixed results. We experienced shortfalls to our revenue and gross profits. However, despite these challenges, we achieved, and in some
cases exceeded, certain pre-established incentive plan goals. This presented a challenge to the Compensation Committee, which was again tasked with balancing the need to provide
compensation sufficient to attract and retain key members of our senior management team through this challenging period, on one hand, with the goal of aligning compensation with stockholder value, on
the other hand. As in previous years, in an effort to strike an appropriate balance between these purposes, the Compensation Committee made certain adjustments to the compensation paid to certain
executive officers (as described in more detail below) as compared to what they would have received based on a strict application of the pre-established performance metrics, while at the
same time ensuring that overall incentive payments reflected the mixed results of 2012. This was accomplished mainly through an increase from 40% to 50% of target in cash incentive payouts to our
senior executives. The net effect of these decisions was an aggregate payout of cash incentive for 2012 performance using a bonus pool of 50% of full target, with certain adjustments for individual
performance based on Mr. Capper's recommendation. The Compensation Committee also awarded equity grants at 50% of target, which was 50% less than 2011 equity awards. In addition, with exception
for market based adjustments for our Chief Financial Officer in 2013, base salaries remained unchanged for 2012 and 2013.

In
addition, the Compensation Committee periodically reviews the Company's executive pay practices, its appropriate peer group and the utilization of shares in its equity plans, with a
view toward ensuring that the Company's overall compensation practices are consistent with the market and effective in generating long-term shareholder value.

Our
compensation program is generally designed to provide performance-oriented incentives that fairly compensate our executive officers and enable us to attract, retain and motivate
executives with outstanding ability and potential. Our compensation program consists of both short-term and long-term components, including cash and equity-based compensation,
and is intended to reward consistent performance that meets or exceeds formally established performance goals and objectives. Our Compensation Committee and senior management is focused on providing
an appropriate mix of short-term and long-term incentives, and we are mindful not to rely on highly leveraged incentives that would result in risky short-term
behavior. Our compensation program provides long-term incentives to ensure that our executives continue in employment with us and directly tie executive compensation to generation of
shareholder value. For 2013, we have revised our Management Incentive Plan to include corporate goals and objectives relating to volume, revenue, and EBITDA growth, and we overlay management by
objective (MBO) goals that are intended to encourage our executives to build and maintain an infrastructure that supports our growth and increases revenues.



Our named executive officers for 2012 are Messrs. Capper, Geldart and Wisniewski, and Ms. Getz and Ms. McNamara.

14

---



Table of Contents



Our Compensation Committee is composed entirely of independent directors. Our Compensation Committee administers our executive
compensation program.

The
general duties of the Compensation Committee include:



Our
Compensation Committee believes that our executive compensation program should include both short-term and long-term components, including cash and
equity-based compensation, and should reward consistent performance that meets or exceeds expectations. In general, we tie compensation to the achievement of specific corporate and individual goals.
Determinations about corporate performance are based on achievement of specific, pre-determined objectives. Individual performance against goals are more subjective and are based on the
judgments made at the discretion of our Compensation Committee and our Board of Directors, with input from our Chief Executive Officer, except as it relates to his own compensation. For our executive
officers other than himself, our Chief Executive Officer evaluates the performance of the executive officers on an annual basis and makes recommendations to our Compensation Committee with respect to
annual salary adjustments, bonuses and annual equity awards. These recommendations are reviewed by our Compensation Committee on an aggregated basis so that our Compensation Committee can evaluate the
compensation paid to our executives on a total compensation basis. While our Compensation Committee reviews the recommendations of our Chief Executive Officer with respect to executive officers other
than himself, our Compensation Committee exercises its own discretion in approving salary adjustments and discretionary cash and equity awards for all executives and communicates its final approval to
our Board of Directors.

We
believe our approach to goal setting, setting of targets with payouts at multiple levels of performance, and evaluation of performance results assist in mitigating excessive
risk-taking that could harm our value or reward poor judgment by our executives. The features of these practices and programs also reflect sound risk management practices. We believe we
have allocated our compensation among base salary and short and long-term compensation target opportunities in such a way as to not encourage excessive risk-taking. This is
based on our belief that applying Company-wide metrics encourages decision making that is in the best long-term interests of the company and our stockholders. In addition, we
believe that the mix of equity award instruments used under our long-term incentive program, including both stock options and full value awards (i.e., restricted stock units), in
each case, that vest over a multi-year period also mitigates risk and properly account for the time horizon of risk.



Currently, our Compensation Committee is chartered to review and make recommendations to our Board of Directors regarding the
compensation to be paid to our Chief Executive Officer and approves compensation for all other executive officers. Historically, our Compensation Committee negotiated compensation with our Chief
Executive Officer, and our Chief Executive Officer consulted with our Board of Directors regarding the compensation of our other named executive officers.

15

---



Table of Contents



The Compensation Committee may retain, at the expense of the Company, independent counsel or other consultants necessary to assist in
fulfillment of its responsibilities and the exercise of its authority under this Charter, including, without limitation, with respect to the preparation of this Compensation Discussion and Analysis
for the Company's filings with the SEC. If a consulting firm is to be retained to assist in the evaluation of director, Chief Executive Officer or senior executive compensation, the Compensation
Committee shall have sole authority to retain and terminate the consulting firm, including sole authority to approve the firm's fees and other retention terms.

In
2009, our Compensation Committee retained PM&P as an independent compensation consultant to assist it in benchmarking our executive compensation decisions and practices against the
group of publicly-traded peer companies listed below. The market study was updated in the fall of 2010 for the purpose of assisting the Compensation Committee with establishing salaries, target bonus
and target long-term incentive opportunities for officers in 2011. In 2012, PM&P re-evaluated the group of peer companies, and determined the group listed below provides an
adequate basis to evaluate comparative positions. Generally, salaries and initial stock grants for our executive officers have been negotiated at the time of hire, taking into account the salaries and
equity awards made to similarly situated executives at the companies in our peer group, as well as the executive's experience in the position and in the industry generally. Thereafter, salaries are
subject to an annual review process, and the adequacy of equity awards are reviewed annually.

At
the time the market analysis was last updated in the fall of 2012, the companies in our peer group included the following 15 publicly traded companies in the medical products and
services sector, with revenue between $70 million and $400 million (with most between $90 million and $240 million), classification by Standard and Poor's ("S&P") as Health
Care Equipment, Health Care Services or Life Sciences Tools & Services, equity market capitalization between $100 million and $1 billion (with most between $300 million and
$500 million), to the extent possible, company considered part of the "cardio" sector of the Med Tech industry:



16

---



Table of Contents

To
achieve its objectives for our executive compensation program, the Compensation Committee evaluates our executive compensation program with the goal of setting compensation at levels
the Compensation Committee believes are competitive with those of other similarly situated companies that compete with us for executive talent and has periodically engaged PM&P to provide additional
assurance that the Company's executive compensation programs are reasonable and consistent with its objectives. PM&P reports directly to the Compensation Committee, periodically participates in
committee meetings, and advises the Compensation Committee with respect to compensation trends and best practices, plan design, and the reasonableness of individual compensation awards. Although the
Compensation Committee reviews the compensation practices of our peer companies as described above, the Compensation Committee does not adhere to strict formulas or survey data to determine the mix of
compensation elements. Instead, as described below, the Compensation Committee considers various factors in exercising its discretion to determine compensation, including the experience,
responsibilities and performance of each of our executive officers, as well as the company's overall financial performance. This flexibility is particularly important in designing compensation
arrangements to attract and retain executives in the period of uncertainty that the company is currently facing.



The compensation program for our executive officers has consisted principally of base salary, short-term cash incentives
and long-term incentives in the form of equity grants.



Generally, base salaries for our executives were established based on the scope of their responsibilities and individual experience,
taking into account our informal understanding of competitive market compensation paid by other companies for similar positions within our industry. Base salaries are typically reviewed annually
taking into account individual responsibilities, performance and achievement. Increases may be determined based upon specific performance related objectives or goals, as well as an overall evaluation
of performance. Guidelines for annual merit increases are determined based upon achievement of company objectives for the year, as well as economic, industry and market factors.

We
believe, based on our recruiting efforts and general experience in our industry, that the base salary levels of our named executive officers are commensurate with the general salary
levels for similar positions in medical device and services companies of similar size and stage of development and operations. In 2012 our Compensation Committee did not adjust the salaries for our
named executive officers. The salaries in effect for 2012 and 2013 are set forth below.

Name

2012 and 2013
Base SalaryJoseph H. Capper

$
535,000Heather C. Getz, CPA

$
322,000
*Anna McNamara, RN

$
321,360Daniel Wisniewski

$
320,000Michael Geldart

$
320,000


*Ms. Getz's
salary was increased from $298,000 for 2013 to be within the 50th percentile of peer group Chief Financial Officers.


In
February 2013, our Compensation Committee met to review performance for 2012 and, at Mr. Capper's recommendation, decided not to award any salary increases for our named
executive officers for 2013, with the exception of Ms. Getz. Our Compensation Committee considered a number

17

---



Table of Contents

of
factors in reaching its decision not to approve base salary increases for 2013, including financial and overall corporate and individual performance during 2012.



We maintain our Management Incentive Plan ("MIP") to reward executives with annual cash bonuses for achievement of certain corporate
performance objectives and individual objectives. The MIP operates on a calendar year schedule.

While
all employees of the Company are eligible to participate in the MIP, our Compensation Committee has the authority to designate which employees will participate in the MIP in any
given year. Unless specifically excepted, an employee must be employed by us by October 1st of any given year to be eligible to participate in the MIP for the calendar year. In addition,
unless specifically excepted, an eligible employee must be actively employed by us on the date bonuses are paid under the MIP to receive a payment. In general, bonuses under the MIP are paid out
within the first two and one-half months following year-end.

On
an annual basis, our Compensation Committee selects the individual and corporate performance goals for the upcoming year and determines how the achievement of those goals will be
measured and the amount of the bonuses determined. Each participant in the MIP is assigned a specific target award, based on his or her role and competitive market practice. The target award reflects
the award to be paid for meeting predefined corporate and individual performance goals. Target awards are defined as a percentage of base salary. For 2012, the Compensation Committee determined that
actual awards under the MIP could range from 0% to 200% of target, depending on performance. Within the formula under the MIP, our Compensation Committee has the discretion to take into account
circumstances that may have affected performance as to any particular participant.

For
2012, our Compensation Committee determined that the corporate performance measures were volume, revenue, EBITDA, as well as team objectives and established minimum and maximum
goals. Our Compensation Committee determined that the above criteria was an appropriate corporate performance objective because it is linked to top line growth and the creation of stockholder value.

For
our named executive officers, the individual target bonuses approved by our Compensation Committee, expressed as a percentage of each person's base salary, were as follows:

Joseph H. Capper


100
%Heather C. Getz, CPA


60
%Other Named Executive Officers


50
%


In
February 2013, our Compensation Committee evaluated the level of achievement of the financial goal, cost reduction goal, and the individual performance objectives relating to
operational commitments relative to the executive officer's position (taking into account the weighting described above together with Mr. Capper's recommendations), and approved funding at 50%
of target, with actual Named Executive Officer bonuses varying from that level based on individual performance evaluation performed by the Company's Chief Executive Officer for each Named Executive
Officer. In making its decision to pay bonuses at these levels, our Compensation Committee balanced the management team's achievement of certain pre-established incentive plan goals with
the overall performance of the Company. With respect to individual objectives, our Compensation Committee considered management's successes in acquiring ECG Scanning and CardioCORE. The Committee also
considered the level of contribution made by each named executive officer with respect to the

18

---



Table of Contents

achievement
of these goals based on the scope of their responsibilities with the Company, taking into account recommendations from Mr. Capper.

Joseph H. Capper

$
267,500Heather C. Getz, CPA

$
107,316Daniel Wisniewski

$
72,000Anna McNamara, RN

$
80,340Michael Geldart

$
60,667
*


*Reflects
prorated bonus.


For
2013, our Compensation Committee has determined that the goals under the MIP will be as follows and will be weighted as noted:

% of Payout

Goal30%

Revenue30%

EBITDA40%

Team Objectives


Our
Compensation Committee determined that these goals are appropriate in order to continue to advance the Company's overall strategic objectives and to enhance stockholder value. The
target bonus opportunity set for the named executive officers for 2013 under the MIP are as follows, and remain unchanged from the 2012 target bonus opportunities:

Joseph H. Capper


100
%Heather C. Getz, CPA


60
%Other Named Executive Officers


50
%




Prior to our initial public offering, we granted equity awards primarily through our 2003 Equity Incentive Plan (the "2003 Plan"),
which was adopted by our Board of Directors and stockholders to permit the grant of stock options, stock bonuses, and restricted stock to our officers, directors, employees and consultants. In the
absence of a public trading market for our common stock prior to the closing of our initial public offering, our Board of Directors and Compensation Committee determined the fair market value of our
common stock in good faith, based upon consideration of a number of relevant factors, including the status of our development efforts, financial status and market conditions. In addition, we secured
an outside valuation from an independent valuation firm in order to set fair market value of our common stock.

In
connection with our initial public offering in 2008, our Board of Directors adopted new equity compensation plans. Specifically, our Board of Directors adopted the 2008 Equity
Incentive Plan (the "2008 EIP"), the Director Plan (as described in more detail below under "Non-Employee Director Compensation") and the 2008 Employee Stock Purchase Plan (the "ESPP").
Each of the new plans became effective on March 18, 2008, upon the effectiveness of our initial public offering. The 2008 EIP replaced the 2003 Plan immediately following our initial public
offering and affords our Compensation Committee much greater flexibility in making a wide variety of equity awards. The ESPP is available to all executive officers on the same basis as our other
employees.

19

---



Table of Contents

Our 2008 EIP authorizes us to grant stock options, stock appreciation rights, restricted stock, restricted stock units, performance stock awards, performance cash
awards and other stock awards. To date, we have granted only stock options and restricted stock units under the 2008 EIP. All stock options granted to our employees and directors were granted with an
exercise price that was no less than the fair market value of a share of our common stock on the date such options were granted. Prior to January 2009, all option grants typically vested over four
years, with one quarter of the shares subject to the stock option vesting on the one year anniversary of the vesting commencement date, and the remaining shares vesting in equal monthly installments
thereafter over three years. Beginning in January 2009, the Compensation Committee determined to modify the vesting schedule for new grants so that, as a general matter, grants would vest in 25%
increments over a four year period beginning with the first anniversary of the date of grant. Our Compensation Committee determined that this vesting schedule better achieved the goal of our
Compensation Committee to encourage retention and dedication to the success of the Company over a longer time horizon (since they vest only at the end of each anniversary year, and not monthly). All
options have a ten year term (unless terminated earlier due to termination of service with the Company). Additional information regarding accelerated vesting upon or following a change in control is
discussed below under "Potential Payments Upon Termination Or Change In Control."

Long Term Incentive Plan

In October 2008 our Board of Directors adopted a Long Term Incentive Plan ("LTIP") to reward executives with stock option and
restricted stock equity grants under our 2008 EIP, based on achievement of pre-established company performance objectives. The LTIP is effective for the issuance of grants based
performance evaluations. The objectives of the LTIP are to drive growth in stockholder value, reward key employees for demonstrated value creation, provide a retention incentive for key employees,
build equity ownership among the executive team, and focus executive on multi-year operating performance. In May 2010, the Board of Directors modified the vesting schedule for grants
issued under the LTIP providing that all future grants will vest at the rate of 25% on December 31st following the grant date and on each of the first, second and third
anniversaries thereafter. We believe that by providing our executives the opportunity to increase their ownership of our stock, the best interests of stockholders and executives will be more aligned
and we will encourage long-term performance. Stock awards enable our executive officers to participate in any increase in stockholder value and personally participate in the risks of
business setbacks. It is our belief that long-term incentives motivate and reward successful long-term value creation and the achievement of financial goals for the Company and
our stockholders, as well as retain top executive talent.

At
the beginning of the next calendar year, awards will be granted following the determination of the corporate financial performance in each year. The target dollar values will be
adjusted by up to 40% above or below the target dollar value stated above in the event that corporate performance exceeds or does not meet the target earnings per share goal. One-half of
this adjusted dollar value will be converted into a stock option award (based on the Black-Scholes value of the option at the time of grant). The stock option will have a 10-year term and
vest 25% per year commencing on December 31st after the date of the grant, and the three anniversaries of the commencement date thereafter. One-half of the
adjusted dollar value will be converted into a restricted stock unit award (based on the closing stock price on the date of grant). The restricted stock unit award will vest in full on the third
anniversary of the date of grant.

In
2012, our Compensation Committee awarded a 100% of target equity payout to executives under the LTIP Plan based on 2011 results, and in 2013 our Compensation Committee awarded at 60%
of target equity payout to executives under the LTIP Plan based on 2012 results. In addition, the Board of Directors approved a discretionary grant of 50,000 shares of common stock to
Mr. Capper under the

20

---



Table of Contents

Company's
EIP plan. The Board awarded this grant in recognition of his leadership effort during 2012. Such grant will be subject to the above term and vesting schedule.

For
our named executive officers, the individual target dollar values approved by our Compensation Committee for 2013 (which remain in effect for each year, unless modified by the
Committee), expressed as a percentage of each person's base salary, were as follows:

Joseph H. Capper

200% of base salaryHeather C. Getz

75% of base salaryAll Other Named Executive Officers

50% of base salary


All
executive officers and other employees selected by our Compensation Committee are eligible to receive awards under the LTIP. The LTIP provides for annual grants of restricted stock
units and stock options under the 2008 EIP based on the achievement of a corporate goal based on adjusted earnings per share, as determined annually by our Compensation Committee. If corporate
financial performance meets the specified earnings per share goal, the participants in the LTIP will receive awards based on each individual's target dollar value, which is determined by our
Compensation Committee. For our named executive officers, the individual target dollar values approved by our Compensation Committee for 2013, expressed as a percentage of each person's base salary,
are as follows:

Joseph H. Capper

200% of base salaryHeather C. Getz, CPA

75% of base salaryOther Named Executive Officers

50% of base salary


Employment Agreements



On June 15, 2010, we entered into an employment agreement with Joseph H. Capper, which provides that he will serve as the
President and Chief Executive Officer of the Company. The agreement was effective on June 15, 2010 and continues until terminated in accordance with its terms.

Pursuant
to the terms of the Employment Agreement, Mr. Capper is entitled to a minimum base salary of $515,000. Mr. Capper also received a bonus payment of $150,000 in
consideration of the incentive and equity compensation Mr. Capper forfeited from his prior employer. Beginning with the 2010 calendar year, Mr. Capper was eligible to participate in the
MIP and LTIP in accordance with the terms of those plans. Mr. Capper's target annual bonus opportunity under the MIP is 100% of his base salary and Mr. Capper's target dollar value for
purposes of the LTIP is 200% of base salary.

Contemporaneously
with his entry into the Employment Agreement, Mr. Capper received a restricted stock unit award with respect to 60,000 shares of CardioNet Common Stock and a
stock option to purchase 500,000 shares CardioNet Common Stock.

The
Employment Agreement provides that in the event the Company terminates Mr. Capper without "cause" or Mr. Capper resigns for "good reason" (each as defined in the
Employment Agreement), it will pay to Mr. Capper severance benefits that consist of the following (i) base salary and accrued and
unused vacation earned through the date of his termination, and (ii) an amount equal to two times his base salary at the rate in effect at the time of termination plus two times his
on-target annual performance incentive bonus in effect for the year of termination, such amount to be paid in 24 monthly installments. Mr. Capper will also be eligible for
continued participation in the Company's medical, dental and vision plans for a period of up to 24 months. Mr. Capper's receipt of the amount described in clause (ii) above and
the continued participation in the Company's medical, dental and

21

---



Table of Contents

vision
plans are contingent upon his execution and non-revocation of a release of claims in the form attached to the Employment Agreement.

Mr. Capper's
employment with the Company is at will and may be terminated by the Company at any time and for any reason, or for no reason. Upon any termination by the Company,
Mr. Capper agrees to resign all positions, including as an officer and, if applicable, as a director or member of the Board of Directors or any committee thereof. See the description under
"Severance and Change in Control Benefits" and "Potential Payments Upon Termination or Change in Control" below for further information regarding severance benefits under Mr. Capper's
employment agreement.

As
a condition of Mr. Capper's employment as our President and Chief Executive Officer, he executed and must abide by our Proprietary Information and Inventions Agreement. Under
the employment agreement, Mr. Capper will be subject to non-competition restrictions for the term of his employment and during any period thereafter in which he is receiving
severance benefits.



The agreements provide severance and change in control benefits upon termination of the executives' termination of employment by us
without cause or by the executives for good reason. See the description under "Severance and Change in Control Benefits" and "Potential Payments Upon Termination or Change in Control" below for
further information regarding severance benefits under the employment agreements.

As
a condition of their employment with us, each executive must execute and abide by our Proprietary Information and Inventions Agreement. Under the employment agreements, each executive
will be subject to non-competition restrictions for the term of his employment and during any period thereafter in which he is receiving severance benefits.

Messrs. Wisniewski
and Geldart and Ms. Getz and Ms. McNamara's employment with us is at will and may be terminated by us at any time and for any reason, or for no
reason. Upon any termination by us, each executive agrees to resign all positions, including as an officer and, if applicable, as a director or member of the board or any committee thereof.



The employment agreements for each of our named executive officers provide for payments in the event that the executive is terminated
by us without cause or by the executive for good reason, in each case, without regard to whether the termination occurs in the context of a change in control. With the exception of Mr. Capper,
if the executive's employment is terminated by us without cause or by the executive for good reason in connection with a change in control, all of the executive's equity awards will immediately
accelerate and become fully vested. All of Mr. Capper's equity awards will immediately accelerate and become fully vested upon a change in control without regard to a termination of employment
(unless he is terminated for cause). Payments and benefits to Messrs. Capper, Wisniewski and Geldart and Ms. Getz and Ms. McNamara will be modified to avoid any excise tax under
Section 409A of the Internal Revenue Code to the extent the modification would result in a greater net after-tax benefit to the executive. We believe these severance and change in
control benefits are an essential element of our overall executive compensation package. The severance and change in control benefits were also determined through comparison to companies in our peer
group.

See
"Potential Payments Upon Termination Or Change In Control" below for further information regarding the payments and benefits under the employment agreements.

22

---



Table of Contents



In addition, consistent with our compensation philosophy, we intend to continue to maintain broad based retirement and welfare employee
benefit programs for all of our employees, in which our named executive officers are also eligible to participate. However, our Compensation Committee, in its discretion, may in the future revise,
amend or add to the benefits of
any executive officer if it deems it advisable. In October 2009, effective January 1, 2010, our Compensation Committee approved a matching contribution under our 401(k) retirement plan of 100%
on the first 3% of compensation deferred under the plan and 50% on the next 2% of compensation deferred under the plan (up to the applicable statutory limits under the Internal Revenue Code). In
October of 2011, as part of the company's previously announced cost cutting initiative, the compensation committee suspended the 401(k) match, effective January 1, 2012.

During
2012, we reimbursed Mr. Geldart and Ms. McNamara for the cost of certain living, commuting and relocation expenses. For Mr. Geldart, the Company made a tax
gross up payment for the taxes they paid on the reimbursement of relocation expenses. With respect to Ms. McNamara, the Company made a tax gross up payment for the taxes she paid on the
reimbursement of living expenses. We agreed to provide these benefits to these individuals because we view them as an integral part of our management team and essential in pursuing our strategic
plans. Mr. Geldart's relocation reimbursement was a condition to his employment with the company, as he was required to relocate to Pennsylvania. Mr. Geldart's expense reimbursement
relating to relocation is prescribed in his Employment Agreement with the Company. The Company is not contractually obligated to pay Mr. Geldart or Ms. McNamara for the cost of living
and commuting expenses. Our Compensation Committee continually evaluates the compensation arrangements in place for our named executive officers and may determine to continue or eliminate these
benefits, at its discretion. With respect to Mr. Geldart benefits were provided on a temporary basis to provide him adequate time to relocate to a permanent residency near our headquarters



The Board has determined that, based on the changes to the Non-Employee Director Compensation program (as more fully
described below), no stock ownership requirement is necessary for its Board members and executive officers.



Our Compensation Committee has no formal policy on the timing of stock option or restricted stock unit grants. Historically, our
Compensation Committee makes such grants in the first quarter of each calendar year. The exercise price is the closing price of the underlying CardioNet Common Stock on the grant date. If an executive
officer of CardioNet is hired after the time the Company usually makes grants, management may recommend to our Compensation Committee that the officer receive equity compensation. Other than the
Director Plan described in more detail under "Non-Employee Director Compensation" below (which has been frozen for future grants), we do not have any program, plan or obligation that
requires us to grant equity compensation to executive officers on specified dates and we have not made equity grants in connection with the release or withholding of material non-public
information. Authority
to make equity grants to executive officers rests with our Compensation Committee (except with respect to grants made to our Chief Executive Officer, which must be approved by our Board of Directors),
based on recommendations from our Compensation Committee, although our Compensation Committee does consider the recommendations of our Chief Executive Officer for executive officers other than
himself.

23

---



Table of Contents



Section 162(m) of the Internal Revenue Code limits our deduction for federal income tax purposes to not more than
$1 million of compensation paid to certain executive officers in a calendar year. Compensation above $1 million may be deducted if it is "performance-based compensation." The
Compensation Committee has not yet established a policy for determining which forms of incentive compensation awarded to our executive officers will be designed to qualify as "performance-based
compensation." To maintain flexibility in compensating our executive officers in a manner designed to promote our objectives, our Compensation Committee has not adopted a policy that requires all
compensation to be deductible. However, our Compensation Committee intends to evaluate the effects of the compensation limits of Section 162(m) on any compensation it proposes to grant, and our
Compensation Committee intends to provide future compensation in a manner consistent with our best interests and those of our stockholders. Shareholder approval of the Company's 2008 Equity Incentive
Plan would ensure continued ability to qualify equity-based compensation under 162(m), as deemed appropriate by our Compensation Committee.

Risk Assessment of the Compensation Programs

The Compensation Committee considers potential risks when reviewing and approving compensation programs. We have designed our
compensation programs, including our incentive compensation plans, with specific features to address potential risks while rewarding employees for achieving long-term financial and
strategic objectives through prudent business judgment and appropriate risk taking. The following elements have been incorporated in our programs available for our executive
officers:



Additionally,
the Compensation Committee considered an assessment of compensation-related risks for all of our employees. Based on this assessment, the Committee concluded that our
compensation programs do not create risks that are reasonably likely to have a material adverse effect on CardioNet. In making this evaluation, the Committee reviewed the key design elements of our
compensation programs in relation to industry norms as well as the means by which any potential risks may be mitigated, such as through our internal controls and oversight by management and the Board
of Directors.

Compensation Committee Report

The Compensation Committee has reviewed and discussed with management the Compensation Discussion and Analysis ("CD&A") contained in
this proxy statement. Based on this review and

24

---



Table of Contents

discussion,
the Compensation Committee has recommended to the Board of Directors that the CD&A be included in this proxy statement and in our Form 10-K for the year ended
December 31, 2012.

Ronald
A. Ahrens, Chair
Rebecca W. Rimel
Eric N. Prystowsky, M.D.

Non-Employee Director Compensation

In July 2007, our Board of Directors adopted a compensation program for our non-employee directors, or the
"Non-Employee Director Compensation Policy." The Non-Employee Director Compensation Policy became effective in March 2008 and was amended in August 2008. In January 2012, in
light of the appointment of an independent Chairman of the Board, the Board of Directors revised the Non-Employee Director Compensation Policy to remove the lead director role and related
compensation, and added an annual cash retainer of $100,000 for the non-executive Chairman of the Board role.

Prior
to 2009, our non-employee directors received initial and annual, automatic, non-discretionary grants of nonqualified stock options to purchase 5,000 shares
of CardioNet Common Stock under the terms and provisions of our director compensation plan (the "Director Plan"), which became effective in March 2008. Each of these grants vested in 12 equal
monthly installments following the date of the grant. In connection with the adoption of the Compensation Program for Non-Employee Directors (as defined below), which became effective as
of the date of the 2009 Annual Meeting and supersedes and replaces all prior non-employee director compensation programs, the Director Plan was frozen and no further grants will be made
under that plan, unless our Board of Directors determines to unfreeze the Director Plan in the future.

In
addition to the foregoing, each non-employee director that joined our Board of Directors prior to the closing of our initial public offering was automatically granted a
non-statutory stock option to purchase 15,000 shares of CardioNet Common Stock under our 2003 Plan with an exercise price equal to the then fair market value of CardioNet Common Stock and
each non-employee director assuming the role of a chairperson of the Audit, Compensation or Nominating and Corporate Governance Committees during such period was automatically granted an
additional non-statutory option to purchase 7,500 shares of CardioNet Common Stock under our 2003 Plan with an exercise price equal to the then fair market value of CardioNet Common Stock
on the date of grant. Each of these grants vest over a three year period, 331/3% of which will vest upon the first anniversary of the date of grant and the remainder will vest in a
series of 24 successive equal monthly installments thereafter. All stock options granted have a maximum term of ten years and will vest in full upon the closing of a change in control transaction.

In
May 2010, our Board of Directors adopted a revised compensation program for our non-employee directors, or the "Compensation Program for Non-Employee
Directors." Pursuant to the Compensation Program for Non-Employee Directors, each non-employee director receives:



25

---



Table of Contents



26

---





Table of Contents

In January 2012, in light of the appointment of an independent Chairman of the Board of Directors, the Board eliminated the lead director role and added an annual
cash award of $100,000 for the Chairman of the Board.

As
Chairman of the Board, Mr. Gorman will receive the annual non-employee director restricted stock unit award described above, and a cash award of $100,000 (paid in 4
quarterly installments over the calendar year as of the last day of each calendar quarter beginning with the first calendar quarter following the inception of his service as Chairman in October, 2011)
or a restricted stock unit award equal to 100% of the amount of the cash award Mr. Gorman elects to have converted into a restricted stock unit award divided by the fair market value of common
stock as of the date the restricted stock units are granted.

In
addition to the foregoing, we have reimbursed and will continue to reimburse our non-employee directors for their travel, lodging and other reasonable expenses incurred in
attending meetings of our Board of Directors and committees of our Board of Directors.

The
following table sets forth information concerning the compensation that we paid or awarded during the year ended December 31, 2012 to each of our non-employee
directors.

Name

Fees Earned
or Paid
in Cash
($)

Stock
Awards
($)

Option
Awards
($)

All Other
Compensation
($)

Total
($)Kirk E. Gorman


56,875


133,756








190,631Rebecca W. Rimel


55,000


80,002








135,002Eric N. Prystowsky, M.D.


60,000


80,002








140,002Ronald A. Ahrens





145,007








145,007Robert J. Rubin, M.D.


25,625


113,757








139,382Anthony J. Conti


32,500


160,004








192,504


27

---



Table of Contents

Summary Compensation Table

The following table provides information regarding the compensation earned during the years ended December 31, 2010, 2011 and
2012 by each person serving in 2012 as a principal executive officer, principal financial and accounting officer or other executive officer, who we collectively refer to herein our "named executive
officers."

Name and principal position

Year

Salary
($)

Bonus
($)

Stock
Awards
($)

Option
Awards(1)
($)

Non-Equity
Incentive Plan
Compensation
($)

All other
compensation
($)

Total
($)Joseph H. Capper


2012


535,000





534,999


519,290


267,500





1,856,789President and Chief


2011


531,154





154,502


155,889


267,500


112,811


1,221,856Executive Officer


2010


265,423





393,600


2,014,635


137,500


245,891


3,057,049Heather C. Getz


2012


298,100





111,787


108,504


107,316





625,707Senior Vice President,


2011


292,888





60,976


104,639


89,430





547,934Chief Financial Officer


2010


244,058





99,548


77,814


93,495





514,915Anna McNamara(2)


2012


321,360





80,340


77,980


80,340


58,506


618,526Senior Vice President,


2011


319,560





46,798


90,337


80,340


58,041


595,076Clinical Operations


2010


307,846





44,996


38,537


89,700


61,213


542,292Michael Geldart(3)


2012


166,154





43,200


124,030


60,667


184,200


578,251Senior Vice President,


2011




















Corporate Strategy and


2010




















Business DevelopmentDaniel Wisniewski


2012


320,000





79,999


77,650


72,000





549,649Senior Vice President,


2011


320,000











80,000





400,000Operations


2010


12,308





84,800


257,624





156,063


510,795


(1)The
amounts reported represent the aggregate grant date fair value of the awards calculated in accordance with FASB ASC 718, as describe in Note 13
of the Company's consolidated financial statements for the year-ended December 31, 2012 included in the Annual Report on form 10-K as filed with the Securities
and Exchange Commission on February 22, 2013.(2)Ms. McNamara
joined CardioNet in 2002 and currently serves as our Senior Vice President, Clinical Operations. All other compensation for 2012
includes $42,165 for certain living and commuting expenses and a tax gross up payment of $16,341 for the taxes applicable to the reimbursement of these expenses.(3)Mr. Geldart
was appointed our Senior Vice President, Corporate Strategy and Business Development in 2012. All other compensation for 2012 includes
$84,200 in consulting fees prior to his appointment with CardioNet, $30,000 sign on bonus, $37,362 for relocation expenses and a tax gross up payment of $70,000 for the taxes applicable to the
reimbursement of these expense relocation expense.


28

---



Table of Contents

Grants of Plan-Based Awards

All stock options granted to our named executive officers are incentive stock options, to the extent permissible under the Internal
Revenue Code. The exercise price per share of each stock option granted to our named executive officers was equal to the fair market value of CardioNet Common Stock as determined in good faith by our
Board of Directors on the date of the grant. All stock options were granted under our 2008 plan.

All
Other
Option
Awards
Number
of
Securities
Underlying
Options
(#)(2)All
Other
Stock
Awards
Number of
Shares of
Stock or
Units
(#)(1)



Grant
Date
Fair
Value of
Stock
and
Option
Awards
($)(5)Estimated Potential Payouts
Under Non-Equity Incentive
Plan Awards

Estimated Potential Payouts
Under Equity Incentive Plan
Awards

Exercise
or Base
Price of
Option
Awards
($/Sh)(4)Name

Grant
Date

Threshold
($)

Target
($)

Maximum
($)

Threshold
($)

Target
($)

Maximum
($)Joseph H. Capper


2/21/2012





535,000


1,070,000


642,000


1,070,000


1,498,000





35,714


2.8


59,2082/21/2012




















191,071








534,9992/21/2012























277,518


2.8


460,082Heather C. Getz


2/21/2012





322,000


241,500


144,900


241,500


338,100


39,924








111,7872/21/2012























13,463


2.8


22,3202/21/2012























51,986


2.8


86,185Anna McNamara


2/21/2012





321,360


160,680


96,408


160,680


224,952





35,361


2.8


58,6232/21/2012























11,676


2.8


19,3572/21/2012




















28,693








80,340Daniel M. Wisniewski


2/21/2012





320,000


160,000


96,000


160,000


224,000


28,571








79,9992/21/2012























35,124


2.8


58,2302/21/2012























11,714


2.8


19,420Michael Geldart


6/11/2012





320,000


160,000


96,000


160,000


224,000





100,000
(3)

2.16


124,0306/11/2012




















20,000








43,200


(1)Represents
restricted stock units (the "RSU's"). RSU's will vest in full on the third anniversary of the grant date, subject to accelerated vesting upon
certain terminations of employment following certain corporate transactions involving the Issuer. The shares of common stock underlying the RSU's will be issued when the RSU's vest.(2)The
options will vest at the rate of 25% on December 31st following the grant date and on each of the first, second and third anniversaries
thereafter.(3)The
options will vest in four equal annual installments commencing on the first anniversary of the date of grant and expire if not exercised within ten
years from the date of grant.(4)Represents
the fair market value of CardioNet Common Stock as determined in good faith by our Board of Directors on the date of the grant.(5)The
amounts reported represent the aggregate grant date fair value of the awards calculated in accordance with FASB ASC 718.


29

---



Table of Contents

Outstanding Equity Awards at December 31, 2012

The following table sets forth certain information regarding outstanding equity awards granted to our named executive officers for 2012
that remain outstanding as of December 31, 2012.

Option Awards

Stock AwardsName

Number of
Securities
Underlying
Unexercised
Options
Exercisable (#)

Number of
Securities
Underlying
Unexercised
Options
Unexercisable (#)

Option
Exercise
Price
($)

Option
Expiration
Date

Number of
Shares or
Units of Stock
That Have Not
Vested (#)(1)

Market Value
of Shares or
Units of Stock
That Have Not
Vested ($)(2)Joseph H. Capper


250,000
(3)

250,000


6.56


6/15/2020





27,166
(4)

27,119


4.67


3/4/2021





78,308
(4)

199,210


2.8


2/21/2022

















60,000


136,800











33,084


75,432











191,071


435,642


35,714


2.8


2/21/2022





Heather C. Getz


22,932
(5)




17.44


5/11/2019





17,068
(5)




17.44


5/11/2019





7,500
(3)

2,500


6.95


8/12/2019





5,000
(3)

5,000


6.43


1/22/2020





4,176
(4)

1,394


8.79


5/10/2020





3,750
(3)

11,250


4.67


3/4/2021





10,702
(4)

10,703


4.67


3/4/2021





16,362
(4)

49,087


2.8


2/21/2022

















10,000


22,800











39,924


91,027











13,057


29,770











4,010


9,143Anna McNamara


7,500
(3)

2,500


6.95


8/12/2019





5,331
(4)

1,779


8.79


5/10/2020





8,214
(4)

8,215


4.67


3/4/2021





3,750
(3)

11,250


4.67


3/4/2021





11,759
(4)

35,278


2.8


2/21/2022

















5,119


11,671











28,693


65,42010,021


22,848Daniel Wisniewski


50,000
(3)

50,000


4.24


12/6/2020





11,709
(4)

35,129


2.8


2/21/2022

















20,000


45,60028,571


65,142Michael Geldart





100,000
(3)

2.16


6/11/2022

















20,000


45,600


(1)Unless
otherwise noted herein, the RSU's will vest in full on the third anniversary of the grant date, subject to accelerated vesting upon certain
terminations of employment following certain corporate transactions involving the Company. The shares of common stock underlying the RSU's will be issued when the RSU's vest.(2)Value
based on the closing stock price of a share of CardioNet Common Stock on December 31, 2012 ($2.28).(3)The
options will vest in four equal annual installments commencing on the first anniversary of the date of the grant and expire if not exercised within ten
years from the date of the grant.(4)The
shares will vest at the rate of 25% on December 31 and on each of the first, second and third anniversaries of the Vesting Commencement Date.


30

---



Table of Contents

(5)These
options were fully vested in December, 2009.


Option Exercises and Stock Vested

Option Awards

Stock Awards(1)Name

Number of
Shares
Acquired on
Exercise (#)

Value
Realized on
Exercise ($)

Number of
Shares
Acquired
on Vesting (#)

Value
Realized
on Vesting ($)Joseph H. Capper











Heather C. Getz








10,000


24,200Anna McNamara








27,788


72,543Daniel Wisniewski











Michael Geldart














(1)The
value realized on exercise of stock option awards is the difference between the stock price on the date of exercise and the exercise price of the
options.


Option Re-pricings

We did not engage in any re-pricings of any of our named executive officers' outstanding equity awards during the year
ended December 31, 2012.

Pension Benefits

None of our named executive officers participate in or have account balances in qualified or non-qualified defined benefit
plans sponsored by us. Our Compensation Committee may elect to adopt qualified or non-qualified benefit plans in the future if it determines that doing so is in our best interests.

Nonqualified Deferred Compensation

None of our named executive officers participate in or have account balances in nonqualified defined contribution plans or other
nonqualified deferred compensation plans maintained by us. Our Compensation Committee may elect to provide our officers and other employees with non-qualified defined contribution or other
nonqualified deferred compensation benefits in the future if it determines that doing so is in our best interests.

Potential Payments Upon Termination Or Change In Control

In this section, we describe payments that may be made to our named executive officers upon several events of termination, including
termination in connection with a change in control. The payment amounts discussed and in the table below reflect the payments that would have been due to the named executive officers had the
termination or change in control event occurred on December 31, 2012. The information in this section does not include information relating to payments and benefits provided on a
nondiscriminatory basis to salaried employees generally upon termination of employment. On December 31, 2012, the last reported sale price of CardioNet Common Stock on the NASDAQ Global Market
was $2.28 per share. Actual amounts payable would vary based on the date of the named executive officer's termination of employment and can only be finally determined at that time.

Unless
specified otherwise, the information in this section is based upon the terms of the (i) Employment Agreement between us and Mr. Capper, dated June 15, 2010,
(ii) Employment Agreement between us and Ms. McNamara, dated October 19, 2009, (iii) Employment Agreement

31

---



Table of Contents

between
us and Ms. Getz, dated January 15, 2010, (iv) Employment Agreement between us and Michael Geldart, dated June 11, 2012, and (v) Employment Agreement between
us and Daniel Wisniewski, dated December 7, 2010 (collectively, the "Agreements").

The
Agreements provide each of our named executive officers severance payments and benefits upon termination of employment by us without cause or by the executives for good reason.
Mr. Capper is entitled to a cash severance payment equal to the sum of (i) 2x his respective annual base salaries as of
the last day of active employment and (ii) 2x his on-target annual performance incentive bonus in effect at the time of termination. With the exception of Mr. Capper, the
other executives are entitled to a cash severance payment equal to the sum of (i) 1x their annual base salaries as of the last day of active employment and (ii) 1x their
on-target annual performance incentive bonus in effect at the time of his termination.

In
addition, we will continue to provide to each of our named executive officers continued participation in our medical, dental and vision plans at the same premium rates and cost
sharing as may be charged from time to time for employees generally for a specified period of time. Specifically, Mr. Capper will receive continued coverage for twenty-four months
following the applicable date of termination and the other executives will have continued coverage for twelve months following the applicable date of termination.

The
foregoing severance payments and benefits payable upon termination of employment to each named executive officer are conditioned on the execution of a written waiver and release of
claims. In addition, for all of our named executive officers, such payments and benefits are consideration for the restrictive covenants set forth in the Agreements. Specifically, during the term of
each executive's employment with us and during any period thereafter in which severance payments or benefits are paid, the executive may not compete with us (as defined in the Agreement).

The
Agreements also provide each named executive officer (with the exception of Mr. Capper) with accelerated vesting of their equity awards in connection with termination of
employment following a change in control. Specifically, if the executive's employment is terminated by us without cause or by the executive for good reason within thirty days before or twelve months
after a change in control, all of equity awards will immediately accelerate and become fully vested. Mr. Capper's equity awards will immediately accelerate and become fully vested upon a change
in control without regard to termination of his employment (unless he is terminated for cause).

In
the event any payment or benefit to the other executive officers would constitute an excess parachute payment within the meaning of Section 280G of the Internal Revenue Code
and be subject to the excise tax imposed by Section 4999 of the Internal Revenue Code, the affected executive will be entitled to the greater of (on a net after-tax basis):
(i) the largest amount of the payment that would result in no portion of the payment or benefit being subject to the excise tax under Section 4999 of the Internal Revenue Code, or
(ii) the entire payment or benefit without any reduction to avoid the excise tax.

The
Agreements do not provide any severance payments or benefits upon a termination by us for cause, by the executive without good reason, or on account of the executive's disability or
death. The executive would be entitled only to base salary and unused vacation benefits earned through the date of the executive's termination of employment and the amount of any vested benefits under
our benefit plans. We will have no further obligations to the executive under the Agreements, except as provided by law.

A
termination for cause under the Agreements would generally result from an executive's: (i) willful and repeated failure to satisfactorily perform his job duties,
(ii) willful commission of an act that materially injures our business, (iii) willful refusal or failure to follow lawful and reasonable directions of our Board of Directors,
(iv) conviction of, or plea ofnolo contendereto, any felony

32

---



Table of Contents

involving
moral turpitude, (v) engagement or in any manner participation in any activity which is directly competitive with or injurious to us or any of our affiliates or which violates any
restrictive covenants applicable to the executive, (vi) commission of any fraud against us, and our affiliates, employees, agents or customers or use or intentional appropriation for the
executive's personal use or benefit of any company funds or property not authorized by our Board of Directors to be so used or appropriated, or (vii) material breach of or willful failure to
comply with our policies, including, but not limited to, equal employment opportunity or harassment policies, insider trading policies, code of ethics or conflict of interest policies,
non-disclosure and confidentiality policies, travel and expense policies, workplace violence policies, Sarbanes-Oxley compliance policies, policies governing preparation and approval of
financial statements, and/or policies governing the making of financial commitments on our behalf.

Good
reason under the Agreements generally exists if, without the executive's consent, there is: (i) a change in the executive's title that is accompanied by a material reduction
in the executive's duties, authority or responsibilities relative to the executive's duties, authority or responsibilities in effect immediately prior to such reduction, (ii) a relocation of
the executive's principal business location to a point that requires a one-way increase of the executive's commuting distance of more than fifty miles, (iii) a material reduction of
the executive's base salary, or (iv) a failure on our part to obtain the agreement from any successor to assume or agree to perform our obligations under the Agreements.

Under
the Agreements, a change in control would be deemed to have occurred if (i) we consolidate or merge with and into any other corporation or other entity or person, or any
other corporate reorganization occurs, in which our capital stock immediately prior to such consolidation, merger or reorganization, represents less than 50% of the voting power of the surviving
entity immediately after such consolidation, merger or reorganization, (ii) we are party to any transaction, or series of related transactions in which more than 50% of our voting power is
transferred (except any consolidation or merger effected exclusively to change our domicile or any transaction or series of transactions principally for bona fide equity financing purposes in which we
receive cash or our indebtedness is canceled), or (iii) we sell, lease, license or dispose of all or substantially all of our assets. The Agreements do not provide for any tax
gross-up compensation for excise taxes.

33

---



Table of Contents

The
following table summarizes the amounts payable to each of our named executive officers based on the items described above with respect to each of the events set forth in the table.

Named Executive Officer

Involuntary Termination
without Cause or For
Good Reason Unrelated
to Change of Control

Upon a
Change of
Control

Involuntary Termination
without Cause or For
Good Reason Related to
a Change of ControlCapper, Joseph H.Cash Severance

$
2,140,000

$


$
2,140,000Continued Welfare

$
20,396

$


$
20,396Acceleration Value of Stock Options

$


$


$
Acceleration Value of Restricted Stock

$


$
647,873

$
647,873Total Value

$
2,160,396

$
647,873

$
2,808,269Getz, Heather C.Cash Severance

$
515,200

$


$
515,200Continue Welfare

$
10,925

$


$
10,925Acceleration Value of Stock Options

$


$


$
Acceleration Value of Restricted Stock

$


$


$
152,739Total Value

$
526,125

$


$
678,864Michael GeldartCash Severance

$
480,000

$


$
480,000Continue Welfare

$
14,911

$


$
14,911Acceleration Value of Stock Options

$


$


$
Acceleration Value of Restricted Stock

$


$


$
45,600Total Value

$
494,911

$


$
540,511McNamara, AnnaCash Severance

$
482,040

$


$
482,040Continue Welfare

$
8,010

$


$
8,010Acceleration Value of Stock Options

$


$


$
Acceleration Value of Restricted Stock

$


$


$
99,939Total Value

$
490,050

$


$
581,979Daniel WisniewskiCash Severance

$
480,000

$


$
480,000Continue Welfare

$
10,976

$


$
10,976Acceleration Value of Stock Options

$


$


$
Acceleration Value of Restricted Stock

$


$


$
57,275Total Value

$
490,976

$


$
548,251


34

---





Table of Contents

Item 12.    Security Ownership of Certain beneficial owners and Management and Related Stockholder Matters

The following table sets forth certain information regarding the ownership of the CardioNet Common Stock as of April 15, 2013
by: (i) each director and nominee for director; (ii) each of the executive officers named in the Summary Compensation Table; (iii) all executive officers and directors of the
Company as a group; and (iv) all those known by the Company to be beneficial owners of more than five percent of CardioNet Common Stock.

Name

Amount and Nature
of Beneficial
Ownership(1)

Percent of
Class*Ronald A. Ahrens(2)


164,336


*Robert J. Rubin, M.D.(3)


139,152


*Kirk E. Gorman(4)


120,036


*Eric N. Prystowsky, M.D.(5)


111,960


*Rebecca W. Rimel(6)


72,992


*Anthony J. Conti


54,796


*Joseph H. Capper(7)


722,022


2.8
%Anna McNamara(8)


101,223


*Heather C. Getz, CPA(9)


103,418


*Michael Geldart(10)


25,000


*Daniel Wisniewski(11)


61,709


*Sophrosyne Capital LLC(12)


2,473,878


9.7
%Camber Capital Management LLC(13)


2,481,412


9.8
%Trigran Investments Inc.(14)


2,488,913


9.8
%Trigran Investments LP(15)


1,485,471


5.9
%Directors and Executive Officers as a Group (11 persons)(16)


1,966,653


7.5
%


*Less
than one percent(1)This
table is based upon information supplied by officers, directors and principal stockholders and Schedules 13D and 13G if any filed with the SEC.
Unless otherwise indicated in the footnotes to this table and subject to community property laws where applicable, the Company believes that each of the stockholders named in this table has sole
voting and investment power with respect to the shares indicated as beneficially owned. Applicable percentages are based on 25,215,366 shares outstanding on February 13, 2013, adjusted as
required by rules promulgated by the SEC.(2)Includes
options to purchase 34,786 shares of CardioNet Common Stock, which were exercisable as of, or will be exercisable within sixty (60) days
after May 28, 2013.(3)Includes
options to purchase 28,489 shares of CardioNet Common Stock, which were exercisable as of, or will be exercisable within sixty (60) days
after May 28, 2013.(4)Includes
options to purchase 27,286 shares of CardioNet Common Stock, which were exercisable as of, or will be exercisable within sixty (60) days
after May 28, 2013.(5)Includes
options to purchase 42,687 shares of CardioNet Common Stock, which were exercisable as of, or will be exercisable within sixty (60) days
after May 28, 2013.(6)Includes
options to purchase 9,388 shares of CardioNet Common Stock, which were exercisable as of, or will be exercisable within sixty (60) days
after May 28, 2013.


35

---



Table of Contents

(7)Includes
options to purchase 605,424 shares of CardioNet Common Stock, which were exercisable as of, or will be exercisable within sixty (60) days
after May 28, 2013.(8)Includes
options to purchase 40,304 shares of CardioNet Common Stock, which were exercisable as of, or will be exercisable within sixty (60) days
after May 28, 2013.(9)Includes
options to purchase 93,740 shares of CardioNet Common Stock, which were exercisable as of, or will be exercisable within sixty (60) days
after May 28, 2013.(10)Includes
options to purchase 25,000 shares of CardioNet Common Stock, which were exercisable as of, or will be exercisable within sixty (60) days
after May 28, 2013.(11)Includes
options to purchase 61,709 shares of CardioNet Common Stock, which were exercisable as of, or will be exercisable within sixty (60) days
after May 28, 2013.(12)Based
on Amendment 2 to Schedule 13G/A filed by Sophrosyne Capital LLC on February 7, 2013. The address of the principal business and
office of Sophrosyne Capital LLC is 156 E 36th Street at 2 Sniffen Court, New York, New York 10016.(13)Based
on Amendment 2 to Schedule 13G/A filed by Camber Capital Management LLC on February 14, 2013. Camber Capital
Management LLC possesses shared voting and shared dispositive power over its 2,481,412 shares. The address of the principal business and office of Camber Capital Management LLC is 101
Huntington Avenue, 25th Floor, Boston, MA 02199.(14)Based
on Amendment 2 to Schedule 13G/A filed by Trigran Investments Inc. on February 14, 2013. Trigran Investments Inc.
possesses shared voting and shared dispositive power over its 2,488,913 shares. The address of the principal business and office of Trigran Investments, Inc. is 630 Dundee Road,
Suite 230, Northbrook, IL 60062.(15)Based
on Amendment 1 to Schedule 13G/A filed by Trigran Investments LP on February 14, 2013. Trigran Investments LP possesses
shared voting and shared dispositive power over its 1,485,471 shares. The address of the principal business and office of Trigran Investments LP is 630 Dundee Road, Suite 230,
Northbrook, IL 60062.(16)Includes
options to purchase 1,170,540 shares of CardioNet Common Stock, which were exercisable as of, or will be exercisable within sixty (60) days
after May 28, 2013.


Item 13.    Certain Relationships and Related Transactions and Director Independence

TRANSACTIONS WITH RELATED PERSONS

RELATED-PERSON TRANSACTIONS POLICY AND PROCEDURES

We have adopted a written Related-Person Transactions Policy that sets forth our policies and procedures regarding the identification,
review, consideration and oversight of "related-persons transactions." For purposes of our policy only, a "related-person transaction" is a transaction, arrangement or relationship (or any series of
similar transactions, arrangements or relationships) in which we and any "related person" are participants involving an amount that exceeds $120,000. Transactions involving compensation for services
provided to us as an employee, director, consultant or similar capacity by a related person are not covered by this policy. A related person is any executive officer, director or a holder of more than
five percent of CardioNet Common Stock, including any of their immediate family members and any entity owned or controlled by such persons.

Under
the policy, where a transaction has been identified as a related-person transaction, management must present information regarding the proposed related-person transaction to our
Audit Committee (or, where review by our Audit Committee would be inappropriate, to another independent

36

---



Table of Contents

body
of our Board of Directors) for review. The presentation must include a description of, among other things, the material facts, the direct and indirect interests of the related persons, the
benefits of the transaction to us and whether any alternative transactions are available. To identify related-person transactions in advance, we rely on information supplied by our executive officers,
directors and certain significant stockholders. In considering related-person transactions, our Audit Committee takes into account the relevant available facts and circumstances including, but not
limited to:



In
the event a director has an interest in the proposed transaction, the director must recuse himself or herself from the deliberations and approval. Our policy requires that, in
reviewing a related-person transaction, our Audit Committee must consider, in light of known circumstances, whether the transaction is in, or is not inconsistent with, the best interests of us and our
stockholders, as our Audit Committee determines in the good faith exercise of its discretion. We did not previously have a formal policy concerning transactions with related persons.

We
are not aware of any transaction required to be reported as a related-person transaction since January 1, 2012 where such policies and procedures did not require review,
approval or ratification or where such policies and procedures were not followed.

INDEPENDENCE OF THE BOARD OF DIRECTORS

As required under the NASDAQ listing standards, a majority of the members of a listed company's Board of Directors must qualify as
"independent," as affirmatively determined by the Board of Directors. The Board of Directors consults with CardioNet's counsel to ensure that the Board of Directors' determinations are consistent with
relevant securities and other laws and regulations regarding the definition of "independent," including those set forth in pertinent listing standards of the NASDAQ, as in effect from time to time.

Consistent
with these considerations, after review of all relevant transactions or relationships between each director, or any of his or her family members, and the Company, its senior
management and its independent registered public accounting firm, the Board of Directors has affirmatively determined that the following directors are independent directors within the meaning of the
applicable NASDAQ listing standards: Messrs. Ahrens, Conti and Gorman, Ms. Rimel and Drs. Prystowsky and Rubin. In making this determination, the Board of Directors found that none of
these directors or nominees for director had a material or other disqualifying relationship with the Company. Mr. Capper, the Company's
President and Chief Executive Officer, is not an independent director by virtue of his employment with the Company.

37

---



Table of Contents

Item 14.    Principal Accounting Fees and Services

PRINCIPAL ACCOUNTANT FEES AND SERVICES

In 2012, the Company entered into an engagement agreement with Ernst & Young LLP which sets forth the terms by which
Ernst & Young LLP will perform audit services for the Company. That agreement is subject to alternative dispute resolution procedures and an exclusion of punitive damages.

The
following table represents aggregate fees billed to the Company for the years ended December 31, 2012 and 2011, respectively, by Ernst & Young LLP, the Company's
independent registered public accounting firm. All fees described below were approved by the Audit Committee.

Year Ended2012

2011Audit Fees(1)

$
606,400

$
475,000Audit-related Fees(4)

$


$
465,000Tax Fees(2)

$
30,000

$
151,000All Other Fees(3)

$
13,000

$
Total Fees

$
649,400

$
1,091,000


(1)Audit
fees were principally for services rendered for the audit and/or review of our consolidated financial statements.(2)Tax
Fees consist of fees billed in the indicated year for professional services performed by Ernst & Young LLP with respect to tax compliance,
tax advice and tax planning.(3)All
Other Fees consist of fees billed in the indicated year for other permissible work performed by Ernst & Young LLP relating to an audit of
the Company's Employee Benefit Plan.(4)Audit-related
fees were for professional services related to merger and acquisition due diligence. No such fees were incurred in 2012.


38

---





Table of Contents

Item 15.    Exhibits, Financial Statements and Schedules

EXHIBIT INDEX

Exhibit
Number

Description2.1

Merger Agreement, dated as of November 5, 2010, among Biotel Inc., Garden Merger Sub, Inc. and the Registrant. (Incorporated by reference to Exhibit 2.1 to the Registrant's Form 8-K filed
November 12, 2010).2.2

Stock Purchase Agreement, dated as of February 10, 2012, by and among the Registrant, ECG Scanning and Medical Services, Inc. and the Stockholder Representatives (as defined therein). (Incorporated by reference
to Exhibit 10.1 to the Registrant's Form 8-K filed February 10, 2012).2.3

Agreement and Plan of Merger, dated as of August 5, 2012, by and among the Registrant, cardioCORE Lab, Inc., Cardinal Merger Sub, Inc. and the Stockholder Representative (as defined therein). (Incorporated
by reference to Exhibit 10.1 to the Registrant's Form 8-K filed August 6, 2012).3.1

Amended and Restated Certificate of Incorporation (Incorporated by reference to the Registrant's registration statement on Form S-1 and amendments thereto (File No. 333-145547)).3.2

Amended and Restated Bylaws (Incorporated by reference to the Registrant's registration statement on Form S-1 and amendments thereto (File No. 333-145547)).4.1

Form of Common Stock Certificate (Incorporated by reference to the Registrant's registration statement on Form S-1 and amendments thereto (File No. 333-145547)).10.1

Form of Indemnity Agreement (Incorporated by reference to the Registrant's registration statement on Form S-1 and amendments thereto (File No. 333-145547)).10.8
(1)
2008 Equity Incentive Plan and Form of Stock Option Agreement thereunder (Incorporated by reference to the Registrant's registration statement on Form S-1 and amendments thereto (File No. 333-145547)).10.9
(1)
2008 Non-Employee Directors' Stock Option Plan and Form of Stock Option Agreement thereunder (Incorporated by reference to the Registrant's registration statement on Form S-1 and amendments thereto (File
No. 333-145547)).10.10
(1)
2008 Employee Stock Purchase Plan and Form of Offering Document thereunder (Incorporated by reference to the Registrant's registration statement on Form S-1 and amendments thereto (File No. 333-145547)).10.12

Office Lease dated February 6, 2004 between the Registrant and Executive One Associates, as amended (Incorporated by reference to the Registrant's registration statement on Form S-1 and amendments thereto (File
No. 333-145547)).10.13

Building Lease Agreement dated September 30, 2009, between the Registrant and EastGroup Properties, L.P. (Incorporated by reference to Exhibit 10.5 to the Registrant's Form 10-Q filed November 6,
2009).10.14

Amendment No. 8 dated February 1, 2010 to the Communication Voice and Data Services Provider Agreement dated May 12, 2003 between the Company and Verizon (as successor to Qualcomm Incorporated and nPhase,
 LLC), as amended (Incorporated by reference to the Registrant's Form 8-K, dated November 30, 2011.


39

---



Table of Contents

Exhibit
Number

Description10.15

Purchase Agreement dated September 14, 2001 between the Registrant and Varian, Inc. (a wholly-owned subsidiary of Jabil Circuit, Inc.) (Incorporated by reference to the Registrant's registration statement
on Form S-1 and amendments thereto (File No. 333-145547)).10.16

Consignment Inventory Agreement dated September 13, 2004 between the Registrant and Varian, Inc. (a wholly- owned subsidiary of Jabil Circuit, Inc.) (Incorporated by reference to the Registrant's
registration statement on Form S-1 and amendments thereto (File No. 333-145547)).10.18
(1)
CardioNet, Inc. Long Term Incentive Plan (Incorporated by reference to Exhibit 10.2 to the Registrant's Form 8-K filed October 28, 2008).10.19
(1)
Compensation Program for Non-Employee Directors. (Incorporated by reference to Exhibit 99.5 to the Registrant's Form 8-K filed January 28, 2009).10.20
(1)
Employment Agreement, dated as of October 19, 2009, by and among the Registrant and Anna McNamara. (Incorporated by reference to Exhibit 10.35 to the Registrant's Form 10-K filed February 23,
2010).10.21
(1)
Employment Agreement, dated as of June 15, 2010, between Joseph H. Capper and the Registrant. (Incorporated by reference to Exhibit 99.2 to the Registrant's Form 8-K filed June 18, 2010).10.22
(1)
Employment Agreement, dated as of January 28, 2010, by and among the Registrant and Heather Getz. (Incorporated by reference to Exhibit 10.36 to the Registrant's Form 10-K filed February 23,
2010).10.23
(1)
Employment Agreement, dated as of December 7, 2010, between the Registrant and Daniel Wisniewski (Incorporated by reference to Exhibit 10.38 to the Registrant's Form 10-K, filed February 25,
2010).10.24
(1)
Employment Agreement dated as of February 7, 2011, between the Registrant and Peter Ferola (Incorporated by reference to Exhibit 10.1 to the Registrant's Form 10-Q dated May 6, 2011).10.25
(1)
Employment Agreement dated as of June 11, 2012, between the Registrant and Michael Geldart (Incorporated by reference to Exhibit 10.1 to the Registrant's Form 10-Q filed August 9, 2012).10.26

Employment Agreement dated as of July 30, 2010, between the Registrant and Fred Anthony Broadway III (Incorporated by reference to Exhibit 10.26 to the Registrant's Form 10-K filed February 22,
2013).23.1

Consent of Independent Registered Public Accounting Firm (Incorporated by reference to Exhibit 23.1 to the Registrant's Form 10-K filed February 22, 2013).31.1

Certification of Chief Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) promulgated under the Securities and Exchange Act of 1934, as amended (Incorporated by reference to Exhibit 31.1 to the
Registrant's Form 10-K filed February 22, 2013).31.2

Certification of Chief Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) promulgated under the Securities and Exchange Act of 1934, as amended (Incorporated by reference to Exhibit 31.2 to the
Registrant's Form 10-K filed February 22, 2013).


40

---



Table of Contents

Exhibit
Number

Description32

Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. (Incorporated by reference to
Exhibit 32 to the Registrant's Form 10-K filed February 22, 2013).101.INS

XBRL Instance Document. (Incorporated by reference to Exhibit 101.INS to the Registrant's Form 10-K filed February 22, 2013).101.DEF

XBRL Taxonomy Definition Linkbase Document (Incorporated by reference to Exhibit 101.DEF to the Registrant's Form 10-K filed February 22, 2013).101.SCH

XBRL Taxonomy Extension Schema Document (Incorporated by reference to Exhibit 101.SCH to the Registrant's Form 10-K filed February 22, 2013).101.CAL

XBRL Taxonomy Extension Calculation Linkbase Document (Incorporated by reference to Exhibit 101.CAL to the Registrant's Form 10-K filed February 22, 2013).101.LAB

Taxonomy Label Linkbase Document (Incorporated by reference to Exhibit 101.LAB to the Registrant's Form 10-K filed February 22, 2013).101.PRE

XBRL Taxonomy Presentation Linkbase Document (Incorporated by reference to Exhibit 101.PRE to the Registrant's Form 10-K filed February 22, 2013).


Confidential
treatment has been granted with respect to certain portions of this exhibit. Omitted portions have been filed separately with the
Securities and Exchange Commission.(1)Indicates
a management plan or compensatory plan or arrangement.


41

---





Table of Contents

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this
Amendment No. 1 to its Annual Report on Form 10-K to be signed on its behalf by the undersigned, thereunto duly authorized.

CardioNet, Inc.Date: April 29, 2013

By:

/s/ JOSEPH H. CAPPER Joseph H. Capper Chief Executive Officer
(Principal Executive Officer)Date: April 29, 2013

By:

/s/ HEATHER C. GETZ Heather C. Getz Chief Financial Officer
(Principal Financial Officer)


42

---