News | August 25, 2011

MedQuist Holdings Inc. Completes Merger with M*Modal

August 25, 2011 — MedQuist Holdings Inc., provider of integrated clinical documentation solutions for the United States healthcare system, announced it has closed on the acquisition of M*Modal. The closing price included $48.4 million in cash and the issuance of 4.1 million shares of MedQuist Holdings common stock paid at closing. The company received notification of early termination of the mandatory, pre-merger waiting period under the Hart-Scott-Rodino (HSR) Antitrust Improvements Act of 1976 on Aug. 15.

The two companies are moving aggressively with integration plans, including organizational structure and product strategies.

MedQuist has projected the acquisition of M*Modal, which was not included in the company's recent guidance for fiscal 2011, will be modestly accretive to adjusted net income per fully diluted share in the fourth quarter of 2011. The acquisition will also increase the company's annualized adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) run-rate by approximately $20 million by year-end 2012.

MedQuist will also make $28.8 million in installments paid in cash over the next three years to M*Modal. The company funded the cash component of the purchase price from available cash.

Additionally, MedQuist expects to incur fees and expenses, including additional restructuring and integration costs associated with this transaction, of approximately $13 million over the next 12 months. The founders and senior executives of M*Modal, Michael Finke, Detlef Koll and Juergen Fritsch will remain deeply involved in the company on a go-forward basis.

In connection with and on the closing date of the merger, MedQuist granted inducement awards of 195,894 restricted shares of common stock to Michael Finke, 117,536 restricted shares of common stock to Detlef Koll and 78,358 restricted shares of common stock to Juergen Fritsch.  

All of these shares will vest on the third anniversary of their grant date so long as they remain in continued service to the company. The restricted shares will become fully vested upon a change in control of the company or their deaths, or if their service terminates without cause due to disability or due to resignation with good reason, so long as they timely execute a release of claims. The shares were granted to Finke, Koll and Fritsch as "inducement awards" and therefore, consistent with applicable NASDAQ rules, did not reduce the shares reserved for issuance under MedQuist’s stockholder approved equity plans.

MedQuist also granted up to an aggregate of 391,782 restricted shares of the company's common stock to 89 M*Modal employees who agreed to stay on at MedQuist or a subsidiary. 

For each such employee, their restricted shares will vest proportionally over a three-year period based on continued service, subject to full acceleration upon termination without cause or resignation with good reason. The shares were granted "inducement awards" and therefore, consistent with applicable NASDAQ rules, did not reduce the shares reserved for issuance under the company's stockholder approved equity plans.

For more information: www.medquist.com

Related Content

 Carestream Focus 35C Detector

Image courtesy of Carestream

News | Digital Radiography (DR) | November 06, 2019
November 6, 2019 — Carestream’s new Focus 35C Detector with Image Suit
Sectra
News | Artificial Intelligence | November 01, 2019
November 1, 2019 — At RSNA 2019, Sectra will showc
 Emergent Connect pneumothorax image

The partnership will bring the power of AI to Emergent Connect's growing customer base, leaving zero-footprint on the client side and eliminating the need for on premise installation and local workstation configurations. 

News | Artificial Intelligence | October 31, 2019
October 31, 2019 — Zebra Medical Vision, a deep learning medical imaging ana
WEBINAR: Using Data Driven Healthcare to Drive Transformative Change with Philips Healthcare.
Webinar | Information Technology | October 24, 2019
Today, health systems are continuously striving to improve performance, utilization, and workflow in order
The webinar Avoid the Pitfalls – How to Make Sense of Security and Compliance in the Enterprise Imaging Landscape is sponsored by Change Healthcare.
Webinar | Cybersecurity | October 24, 2019
The webinar "Avoid the Pitfalls – How to Make Sense of Security and Compliance in the Enterprise Imaging Landscape" w
Intelerad Expands Cloud-based Managed Services Offering Worldwide
News | PACS | October 23, 2019
Intelerad Medical Systems announced the worldwide expansion of its Nuage Cloud Managed Services offering. Medical...
Dicom Systems Receives U.S. Patent for Medical Data Integration Engine
News | Enterprise Imaging | October 22, 2019
Dicom Systems announced that the U.S. Patent and Trademark Office (USPTO) has issued U.S. Patent 10,437,877 B2 to...
Laurel Bridge Software Celebrates 20th Anniversary
News | Enterprise Imaging | October 21, 2019
Laurel Bridge Software recently celebrated its 20th anniversary of helping healthcare providers and original equipment...
Surgical Institute of Reading Chooses RamSoft's PowerServer Lite PACS
News | PACS | October 18, 2019
Surgical Institute of Reading recently selected RamSoft’s PowerServer Lite PACS (picture archiving and communication...