Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On February 13, 2009, the Compensation Committee of MedCath Corporation's ("MedCath") Board of Directors awarded shares of restricted stock to O. Edwin French, Jeffrey L. Hinton, James A. Parker, Blair W. Todt, and Joan McCanless in the amount of 159,574; 72,606; 15,957; 13,936; and 13,094 shares, respectively. Other members of MedCath's senior management also received restricted stock awards. Fifty percent (50%) of each officer's restricted stock will vest in equal annual installments over the next three years. The remaining 50% of each officer's restricted stock will vest in equal annual installments over the next three years based on MedCath's annual earnings per share performance during the vesting period.
MedCath's board of directors also established stock ownership requirements for its officers in the position of senior vice president and higher. Under the stock ownership requirements, MedCath's officers who are subject to the requirements must own shares of MedCath common stock that have a value equal to a multiple of their respective salaries.
Historically, MedCath's officers had been awarded stock options as long-term incentive compensation. The Compensation Committee's decision to award restricted stock rather than stock options in 2009 was designed to address, in part, the historical and current volatility of the value of stock options and instill a sense of MedCath ownership in the recipients. The stock ownership requirements were designed to enhance management's stake in MedCath. Both of these changes were intended to more closely align the officers' interests to those of MedCath's shareholders.
Paul Queally has notified the Company of his resignation from the board of directors effective immediately following the upcoming annual shareholders' meeting on March 4, 2009.

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