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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): June 29, 2000
MedQuist Inc.
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(Exact name of registrant as specified in its charter)
New Jersey 0-19941 22-2531298
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(State or Other Jurisdiction (Commission (I.R.S. Employer ID No.)
of Incorporation) File Number)
Five Greentree Centre
Suite 311
Marlton, New Jersey 08053
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(Address of Principal Executive Offices)
Registrant's telephone number, including area code (856) 596-8877
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Item 1. Changes in Control of Registrant.
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On June 29, 2000, Koninklijke Philips Electronics N.V. ("Royal
Philips"), a corporation organized under the laws of the Netherlands, acquired
22,250,327 shares of common stock (the "Shares"), no par value, of MedQuist Inc.
("MedQuist"), representing approximately 57% of the outstanding fully diluted
Shares of MedQuist, for $51.00 per share, net to the seller in cash, pursuant to
a tender offer to MedQuist shareholders by Royal Philips (the "Offer"). Validly
tendered shares were accepted for purchase and will be paid for promptly in
accordance with the terms of the Offer. Royal Philips will additionally purchase
approximately 3% of the outstanding fully diluted shares of MedQuist from the
holdings of a number of members of MedQuist senior management.
The purchase price for the Shares purchased pursuant to the Offer and
directly from senior management was determined pursuant to arms-length
negotiations between the parties. The total amount of funds required by Royal
Philips to acquire the tendered Shares pursuant to the Offer and the Shares to
be acquired from members of MedQuist senior management will be approximately
$1.192 billion. Royal Philips' source of funds for its acquisition of the Shares
consisted of cash reserves.
Pursuant to a Governance Agreement (the "Governance Agreement"), after
purchase by Royal Philips of Shares in the Offer, the Board of Directors of
MedQuist (the "Board") shall consist of 11 members and be divided into three
groups: Management Directors; Independent Directors; and Philips Directors. The
Management Directors are initially David A. Cohen, the Chairman and Chief
Executive Officer of MedQuist, and John A. Donohoe, Jr., the President and Chief
Operating Officer of MedQuist. The Independent Directors of MedQuist are
initially Richard H. Stowe, John H. Underwood and A. Fred Ruttenberg. The
Philips Directors are initially Jan H.M. Hommen, Adri Bann, Hans M. Barella,
William E. Curran, Ivo J.M. Lurvink and Cesar Vohringer. Moreover, composition
of the Board's Compensation and Nominating Committees were altered and the Board
established a Supervisory Committee. Messrs. Samek, Stack, Emshoff, Mulligan,
Carson, Casey and Censits, each directors of MedQuist, all resigned from the
Board effective upon the payment by Royal Philips for the Shares purchased
pursuant to the Offer.
Other than the Governance Agreement, there are no material
arrangements between MedQuist, on the one hand, and Royal Philips, any of
its affiliates, any director or officer of Royal Philips or any associate of any
such director or officer, on the other hand, relating to the election of
directors or the governance of MedQuist. The Governance Agreement is more
particularly described in MedQuist's Schedule 14D-9 dated June 1, 2000 and is
attached hereto as Exhibit Number 2.
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Item 7(c).
Exhibits Exhibit Number
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Press Release dated as of June 29, 2000 1
Governance Agreement dated May 22, 2000 2
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
MEDQUIST INC.
(Registrant)
Date: June 30, 2000 By: /s/ John M. Suender
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John M. Suender
Senior Vice President,
Secretary and General Counsel
