CUSIP NO. 584949 10 1 Page 1 of 10 Pages
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
(Rule 13d-101)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT
TO RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO
RULE 13d-2(a)
(Amendment No. )1
MedQuist Inc.
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(Name of Issuer)
Common Stock, no par value
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(Title of Class of Securities)
584949 10 1
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(CUSIP Number)
Welsh, Carson, Anderson William J. Hewitt, Esq.
& Stowe VI, L.P, Reboul, MacMurray, Hewitt,
320 Park Avenue, Suite 2500 Maynard & Kristol
New York, New York 10022 45 Rockefeller Plaza
Attention: Laura VanBuren New York, New York 10111
Tel. (212) 893-9500 Tel. (212) 841-5700
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
December 10, 1998
(Date of Event Which Requires Filing of This Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d- 1(e), 13d-1(f) or 13d-1(g), check the following
box [ ].
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1 The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securites, and for any subsequent amendment containing information which would
alter disclosures provided in a prior cover page. The information required on
the remainder of this cover page shall not be deemed to be "filed" for the
purpose of Section 18 of the Securities Exchange Act of 1934 or otherwise
subject to the liabilities of that section of the Act but shall be subject to
all other provisions of the Act.
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CUSIP NO. 584949 10 1 Page 2 of 10 Pages
1) Name of Reporting Person Welsh, Carson, Ander-
S.S. or I.R.S. Identification son & Stowe VI, L.P.
No. of Above Person
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2) Check the Appropriate Box (a) [X]
if a Member of a Group (b) [ ]
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3) SEC Use Only
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4) Source of Funds OO
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5) Check if Disclosure of
Legal Proceedings Is Not Applicable
Required Pursuant to
Items 2(d) or 2(e)
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6) Citizenship or Place
of Organization Delaware
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Number of 7) Sole Voting 3,275,880 shares of
Shares Beneficially Power Common Stock, no par
Owned by Each value ("Common
Person With Stock")
-------------------------------------
8) Shared Voting
Power -0-
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9) Sole Disposi- 3,275,880 shares of
tive Power Common Stock
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10) Shared Dis-
positive Power -0-
-------------------------------------
11) Aggregate Amount Beneficially 3,275,880 shares of
Owned by Each Reporting Person Common Stock
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12) Check if the Aggregate
Amount in Row (11)
Excludes Certain Shares
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13) Percent of Class
Represented by 10.1%
Amount in Row (11)
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14) Type of Reporting
Person PN
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CUSIP NO. 584949 10 1 Page 3 of 10 Pages
1) Name of Reporting Person WCAS Healthcare
S.S. or I.R.S. Identification Partners, L.P.
No. of Above Person
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2) Check the Appropriate Box (a) [X]
if a Member of a Group (b) [ ]
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3) SEC Use Only
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4) Source of Funds OO
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5) Check if Disclosure of
Legal Proceedings Is Not Applicable
Required Pursuant to
Items 2(d) or 2(e)
- --------------------------------------------------------------------------------
6) Citizenship or Place
of Organization Delaware
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Number of 7) Sole Voting 38,880 shares of
Shares Beneficially Power Common Stock
Owned by Each -------------------------------------
Reporting Person
With 8) Shared Voting
Power -0-
-------------------------------------
9) Sole Disposi- 38,880 shares of
tive Power Common Stock
-------------------------------------
10) Shared Dis-
positive Power -0-
-------------------------------------
11) Aggregate Amount Beneficially 38,880 shares of
Owned by Each Reporting Person Common Stock
12) Check if the Aggregate
Amount in Row (11)
Excludes Certain Shares
13) Percent of Class
Represented by 0.1%
Amount in Row (11)
14) Type of Reporting
Person PN
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CUSIP NO. 584949 10 1 Page 4 of 10 Pages
Schedule 13D
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Item 1. Security and Issuer.
--------------------
This statement relates to the Common Stock, no par value (the "Common
Stock"), of MedQuist Inc., a New Jersey corporation ("MedQuist" or the
"Issuer"). The principal executive offices of the Issuer are located at Five
Greentree Centre, Suite 311, Marlton, New Jersey 08053.
Item 2. Identity and Background.
-----------------------
(a) Pursuant to Rule 13d-1(k)(1)-(2) of Regulation 13D-G of the
General Rules and Regulations under the Securities Exchange Act of 1934, as
amended (the "Act"), the undersigned hereby file this statement on Schedule 13D
on behalf of Welsh, Carson, Anderson & Stowe VI, L.P., a Delaware limited
partnership ("WCAS VI"), and WCAS Healthcare Partners, L.P., a Delaware limited
partnership ("WCAS HP"). WCAS VI and WCAS HP are sometimes hereinafter referred
to as the "Reporting Persons". The Reporting Persons are making this single,
joint filing because they may be deemed to constitute a "group" within the
meaning of Section 13(d)(3) of the Act. The Agreement between the Reporting
Persons to file as a group (the "Group Agreement") is attached hereto as Exhibit
A.
WCAS VI
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(b)-(c) WCAS VI is a Delaware limited partnership. The principal
business of WCAS VI is that of a private investment partnership. The sole
general partner of WCAS VI is WCAS VI Partners, L.P., a Delaware limited
partnership ("VI Partners"). The principal business of VI Partners is that of
acting as the general partner of WCAS VI. The principal business and principal
office address of WCAS VI, VI Partners and the general partners of VI Partners
is 320 Park Avenue, Suite 2500, New York, New York 10022. The general partners
of VI Partners are citizens of the United States, and their respective principal
occupations are set forth below.
WCAS HP
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(b)-(c) WCAS HP is a Delaware limited partnership. The principal
business of WCAS HP is that of a private investment partnership. The sole
general partner of WCAS HP is WCAS HP Partners, a Delaware general partnership
("HP Partners"). The principal business of HP Partners is that of acting as the
general partner of WCAS HP. The principal business and principal office address
of WCAS HP, HP Partners and the general partners
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CUSIP NO. 584949 10 1 Page 5 of 10 Pages
of HP Partners is 320 Park Avenue, Suite 2500, New York, New York 10022. The
general partners of HP Partners are citizens of the United States, and their
respective principal occupations are as follows:
General Partners Occupation
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Patrick J. Welsh General Partner, VI Partners and HP Partners
Russell L. Carson General Partner, VI Partners and HP Partners
Bruce K. Anderson General Partner, VI Partners
Richard H. Stowe General Partner, VI Partners
Thomas E. McInerney General Partner, VI Partners
Andrew M. Paul General Partner, VI Partners
Laura VanBuren General Partner, VI Partners
Robert A. Minicucci General Partner, VI Partners
Anthony J. deNicola General Partner, VI Partners
Paul B. Queally General Partner, VI Partners
(d) None of the entities or persons identified in this Item 2 has,
during the last five years, been convicted in a criminal proceeding (excluding
traffic violations or similar misdemeanors).
(e) None of the entities or persons identified in this Item 2 has,
during the last five years, been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such proceeding
was or is subject to a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to, federal or
state securities laws or finding any violation with respect to such laws.
Item 3. Source and Amount of Funds and Other Consideration.
--------------------------------------------------
This statement relates to the acquisition by the Reporting Persons of
an aggregate 3,314,760 shares of Common Stock pursuant to an Agreement and Plan
of Merger made on September 18, 1998, by and among the Issuer, Mercury
Acquisition
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CUSIP NO. 584949 10 1 Page 6 of 10 Pages
Corporation, a Missouri corporation and a wholly-owned subsidiary of the Issuer
("Sub"), and The MRC Group, Inc., a Missouri corporation ("MRC") (the "Merger
Agreement"). The Merger Agreement is incorporated as Exhibit B hereto by
reference to Annex A to the Joint Proxy Statement/Prospectus dated November 3,
1998 contained in the Issuer's Registration Statement on Form S- 4, as filed
with the Securities and Exchange Commission on October 30, 1998 (the "Form
S-4"), and any description thereof is qualified in its entirety by reference
thereto.
As provided in the Merger Agreement, effective December 10, 1998 Sub
merged with and into MRC (the "Merger"), upon which the separate existence of
Sub ceased, leaving MRC as the surviving corporation and a wholly-owned
subsidiary of the Issuer. As a result of the Merger, each share of common stock
and preferred stock of MRC was converted into the right to receive such number
of shares of MedQuist Common Stock as calculated in accordance with Section 2.4
of the Merger Agreement. The general partners of the respective general partners
of the Reporting Persons who were shareholders of MRC also acquired MedQuist
Common Stock in the Merger. The Common Stock issued in the Merger was registered
under the Securities Act of 1933, as amended, pursuant to the Form S-4.
Item 4. Purpose of Transaction.
----------------------
The purpose of the transaction described in Item 3 above was to effect
the acquisition of MRC by the Issuer.
Item 5. Interest in Securities of the Issuer.
------------------------------------
The following information is based on a total of 32,300,000 shares of
Common Stock outstanding after the completion of the Merger:
(a)
WCAS VI and VI Partners
-----------------------
WCAS VI owns 3,275,880 shares of Common Stock, or
approximately 10.1% of the Common Stock outstanding. VI Partners, as the general
partner of WCAS VI, may be deemed to beneficially own the securities owned by
WCAS VI.
WCAS HP and HP Partners
-----------------------
WCAS HP owns 38,880 shares of Common Stock, or approximately 0.1% of
the Common Stock outstanding. HP Partners,
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CUSIP NO. 584949 10 1 Page 7 of 10 Pages
as the general partner of WCAS HP, may be deemed to beneficially own the
securities owned by WCAS HP.
General Partners of VII Partners and HP Partners
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(i)Patrick J. Welsh owns 19,469 shares of Common Stock, or less than
0.1% of the Common Stock outstanding.
(ii) Russell L. Carson owns 19,469 shares of Common Stock, or less
than 0.1% of the Common Stock outstanding.
(iii) Bruce K. Anderson owns 18,963 shares of Common Stock, or less
than 0.1% of the Common Stock outstanding.
(iv) Richard H. Stowe owns 5,855 shares of Common Stock (including
3,917 shares held in an IRA account), or less than 0.1% of the Common Stock
outstanding.
(v) Andrew M. Paul owns 3,917 shares of Common Stock, or less than
0.1% of the Common Stock outstanding.
(vi) Thomas E. McInerney owns 2,956 shares of Common Stock, or less
than 0.1% of the Common Stock outstanding.
(vii) Laura VanBuren owns 377 shares of Common Stock, or less than
0.1% of the Common Stock outstanding.
(b) The general partners of each of VI Partners and HP Partners may be
deemed to share the power to vote or direct the voting of and to dispose or
direct the disposition of the Common Stock owned by WCAS VI and WCAS HP,
respectively. Each of the general partners of VI Partners and HP Partners
disclaims beneficial ownership of all shares of Common Stock other than the
shares he or she owns directly or by virtue of his or her indirect pro rata
interest, as a partner of VI Partners and/or HP Partners, as the case may be, in
the shares owned by WCAS VI and/or WCAS HP.
(c) Except as described in this statement, none of the entities or
persons named in Item 2 has effected any transaction in the Common Stock in the
past 60 days.
(d) Except as described in this statement, no person has the power to
direct the receipt of dividends on or the proceeds of sales of the shares owned
by WCAS VI or WCAS HP.
(e) Not Applicable.
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CUSIP NO. 584949 10 1 Page 8 of 10 Pages
Item 6. Contracts, Arrangements, Understandings or
Relationships with Respect to Securities
of the Issuer.
------------------------------------------
As a condition to the Merger Agreement, the Reporting Persons, as
affiliates of MRC, were required to deliver Affiliate Letters to MedQuist
stating, among other things, that they would not sell or otherwise transfer,
dispose of or reduce their risk with respect to any of their securities of MRC
or of MedQuist (except under the de minimus exception to the rules governing
"pooling-of-interests" transactions) until MedQuist shall have published
financial results covering at least 30 days of post-Merger combined operations
of MedQuist and MRC and thereafter, except in compliance with applicable federal
and state securities laws. A Form of Affiliate Letter is Exhibit C to the Merger
Agreement, and any description thereof is qualified in its entirety by reference
thereto.
Item 7. Material to Be Filed as Exhibits.
Exhibit A - Group Agreement (Appears at Page 10)
Exhibit B - Merger Agreement (Incorporated by Reference to Annex A to
the Joint Proxy Statement/Prospectus dated November 3, 1998 contained in the
Issuer's Registration Statement on Form S-4, as filed on October 30, 1998)
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CUSIP NO. 584949 10 1 Page 9 of 10 Pages
Signature
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After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: December 10, 1998
WELSH, CARSON, ANDERSON & STOWE VI, L.P.
By: WCAS VI Partners, L.P., General Partner
By: /s/ Laura VanBuren
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General Partner
WCAS HEALTHCARE PARTNERS, L.P.
By: WCAS HP Partners, General Partner
By: /s/ Laura VanBuren
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Attorney-in-Fact
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CUSIP NO. 584949 10 1 Page 10 of 10 Pages
EXHIBIT A
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AGREEMENT
OF
WELSH, CARSON, ANDERSON & STOWE VI, L.P.
AND WCAS HEALTHCARE PARTNERS, L.P.
Pursuant to Rule 13d-1(k)
-------------------------
The undersigned hereby agree that the statement on Schedule 13D to
which this Agreement is annexed as Exhibit A is filed on behalf of each of them
in accordance with the provisions of Rule 13d-1(k) under the Securities Exchange
Act of 1934, as amended.
Dated: December 10, 1998
WELSH, CARSON, ANDERSON & STOWE VI, L.P.
By: WCAS VI Partners, L.P., General Partner
By: /s/ Laura VanBuren
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General Partner
WCAS HEALTHCARE PARTNERS, L.P.
By: WCAS HP Partners, General Partner
By: /s/ Laura VanBuren
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Attorney-in-Fact
