For the Product Leadership Award, the following criteria were used to benchmark Merge Healthcare s performance against key competitors:

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2 Product Leadership Award Medical Imaging Interoperability Solutions North America, 2013 Frost & Sullivan sglobal Research Platform Frost & Sullivan is in its 50th year in business with a global research organization of 1,800 analysts and consultants who monitor more than 300 industries and 250,000 companies. The company s research philosophy originates with the CEO s 360-Degree Perspective, which serves as the foundation of its TEAM Research methodology. This unique approach enables us to determine how best-in-class companies worldwide manage growth, innovation and leadership. Based on the findings of this Best Practices research, Frost & Sullivan is proud to present the 2013 North American Product Leadership Award in Medical Imaging Interoperability Solutions to Merge Healthcare. Key Benchmarking Criteria for Product Leadership Award For the Product Leadership Award, the following criteria were used to benchmark Merge Healthcare s performance against key competitors: Product Features/Functionality Innovative Element of the Product Product Acceptance in the Marketplace Provides Customer Value Enhancements Product Quality Decision Support Matrix and Measurement Criteria To support its evaluation of best practices across multiple business performance categories, Frost & Sullivan employs a customized Decision Support Matrix (DSM). The DSM is an analytical tool that compares companies performance relative to each other with an integration of quantitative and qualitative metrics. The DSM features criteria unique to each Award category and ranks importance by assigning weights to each criterion. The relative weighting reflects current market conditions and illustrates the associated importance of each criterion according to Frost & Sullivan. Fundamentally, each DSM is distinct for each market and Award category. The DSM allows our research and consulting teams to objectively analyze each company's performance on each criterion relative to its top competitors and assign performance ratings on that basis. The DSM follows a 10-point scale that allows for nuances in performance evaluation; ratings guidelines are shown in Chart Frost & Sullivan 1 We Accelerate Growth

3 Chart 1: Performance-Based Ratings for Decision Support Matrix This exercise encompasses all criteria, leading to a weighted average ranking of each company. Researchers can then easily identify the company with the highest ranking. As a final step, the research team confirms the veracity of the model by ensuring that small changes to the ratings for a specific criterion do not lead to a significant change in the overall relative rankings of the companies. Chart 2: Frost & Sullivan s 10-Step Process for Identifying Award Recipients Best Practice Award Analysis for Merge Healthcare The Decision Support Matrix, shown in Chart 3, illustrates the relative importance of each criterion for the Product Leadership of the Year Award and the ratings for each company under evaluation. To protect the interests of the award recipient s competitors, we have chosen to refer to them as Competitor 1 and Competitor Frost & Sullivan 2 We Accelerate Growth

4 Features/Functionality Innovative Element of the Product Product Acceptance in the Marketplace Provides Customer Value Enhancements Product Quality Weighted Rating BEST PRACTICES RESEARCH Chart 3: Decision Support Matrix for Product Leadership Award Measurement of 1 10 (1 = lowest; 10 = highest) Award Criteria Relative Weight (%) 20% 20% 20% 20% 20% 100% Merge Healthcare Competitor Competitor Criterion 1: Product Features/Functionality The present Product Leadership Award is presented to Merge Healthcare in recognition of the integrated suite of products comprising Merge s iconnect Enterprise Clinical Platform. Through its three core products its enterprise archive component, iconnect Enterprise Archive; its viewing component, iconnect Access; and its image sharing component, iconnect Share the platform provides a complete image management and interoperability solution well-suited for the modernday imaging enterprise. Indeed, each of these three products is a best-of-breed solution boasting the latest advances in technology and standards in its respective area. Not only is each product among the top three most competitive product offerings in its industry segment, the combined solution set is clearly the most complete and best integrated interoperability solution for imaging informatics overall. Forming a modular portfolio delivered under flexible purchasing and deployment models, the solution set can deliver to any type of imaging provider the building blocks of a sound and forward-looking enterprise imaging strategy. The iconnect platform is the result of many years of research and development leveraging multiple domain areas of expertise, technology acquisitions, and market experiences for Merge. By catering adequately to the clinical and IT enterprise while highlighting the many cross-synergies that are possible 2013 Frost & Sullivan 3 We Accelerate Growth

5 amongst them, iconnect essentially exemplifies the coming-together of technology strategy and business strategy, both for the company and for the market. Criterion 2: Innovative Element of the Product Growth in the imaging informatics market has been challenged considerably since In addition to a detrimental macroeconomic environment impacting technology purchases in healthcare, the market s core RIS/PACS segment has also suffered from low capital spending and slow replacement dynamics that are persisting into In this challenging growth environment, which is impacting providers and vendors alike, Merge stands out in its ability to continue to innovate and develop new features in its products. In fact, despite this industry slowdown, Merge has continued to increase its research and development (R&D) spending by double digits over the last several years. These proactive efforts and strategic investments by Merge are clearly paying off for the company today. They translate into a cohesive solution set, providing full functionality for the imaging IT enterprise, incorporating the best of recent acquired products, as well as several new innovative products. As one example, the Merge HoneyComb solution builds on each of the various pieces of the iconnect platform to constitute a full line of cloud-based image management, archiving, and exchange services. Merge is also at the forefront of emerging trends toward patient engagement and consumer healthcare in the U.S., leading innovative industry efforts through the Merge DNA (Data & Analytics) operating group that it formed in Criterion 3: Product Acceptance in the Marketplace Merge s commitment to pioneering the development of the next generation of imaging informatics solutions has engendered market traction on several different fronts. Merge is leveraging the synergies of a full-featured and flexible portfolio to cater effectively to the various customer segments across the hospital and outpatient settings. For example, Merge s vendor-neutral archive (VNA) has been adopted by hospitals of all types and sizes, and these sites are currently considering image exchange and enterprise viewing across their various specialties. Conversely, the image exchange capabilities have provided a great entry point into healthcare information exchanges (HIE), as well as a significant upsell opportunity within integrated delivery networks (IDN) many of which are contemplating their next-generation enterprise archive. Similarly, ambulatory care providers have responded favorably to the service-oriented business model of Merge. In fact, Merge solutions have a proven track record of delivering high performance, even in facilities challenged by low-bandwidth connectivity. Yet another front on which Merge is demarcating itself from more traditional PACS vendors is its unique market positioning as part of the broader electronic medical record (EMR) industry and healthcare IT ecosystem. This highly strategic position is exemplified by the privileged industry relationships that Merge has nurtured with Epic and Cerner, the two 2013 Frost & Sullivan 4 We Accelerate Growth

6 leading EMR vendors in the U.S. Another case in point is the recent agreement between Merge and Surescripts, a leading provider of e-prescription solutions, whereby Merge connects its own imaging network with the Surescripts Network for Clinical Interoperability, essentially providing the image piece as part of the EMR environment of hundreds of providers that are part of the Surescripts network. The high level of interoperability that can then be achieved by embedding iconnect Access seamlessly using bi-directional EMR integration is what makes Merge s image enablement capabilities unique in the marketplace today. Criterion 4: Provides Customer Value Enhancements Reinforced by its new portfolio organization, Merge s value proposition is built on the efficient delivery of high performance, highly scalable, and cost-effective IT solutions that have a proven ability to improve, and open up new avenues for productivity enhancement, cost reduction, infrastructure consolidation, and clinical collaboration. This value proposition resonates extremely well in today s market, where instead of new turnkey systems, imaging providers are focused on addressing the shortcomings of incumbent systems. While some providers are receptive to a virtual deployment model, coupled with a study volume-based purchasing model, other providers value Merge s customized approach, coupled with a do-ityourself attitude for certain IT functions. Merge s iconnect Enterprise Clinical Platform has been intelligently designed to address cost-efficiently the varying needs and preferences in all of these different scenarios, thereby fueling Merge s market expansion. Looking back at the last four years, since 2009 when all eyes in the healthcare industry turned to Meaningful Use (MU) considerations, Frost & Sullivan estimates that Merge has been a leading force on the side of imaging informatics vendors. Throughout MU Stage 1 and now going into MU Stage 2, Merge has been extremely proactive in achieving certification for its products and assisting customers in meeting MU criteria, while qualifying for MU incentive funding. While many Merge customers have been able to obtain MU funds under Stage 1, this track record is growing even more significantly today as the implementation of the final Stage 2 ruling begins in Indeed MU Stage 2 promotes, among a limited set of other option items, the image-enablement of the Electronic Health Record (EHR), an area where Merge already excels in. Criterion 5: Product Quality Acting as a cohesive group, Merge s research and development team has been able to maintain the iconnect platform at the leading edge of functionality, performance, and quality. Its keen focus is on architecture, with an unwavering attachment to standards, and the proven scalability of the products and the design of intelligent workflow-aware solutions. These singular features act to emphasize the interoperability of Merge s imaging informatics 2013 Frost & Sullivan 5 We Accelerate Growth

7 solutions once in the field. Now, managing hundreds of millions of studies, integrated with a wide variety of third-party storage and HIT vendors, Merge s solutions essentially allow providers to balance their IT-related efforts, including Meaningful Use, their clinical efforts acting to enhance quality of care while lowering costs, and their regulatory efforts, such as HIPAA. The momentum in market adoption that Merge is experiencing with each component of its iconnect Enterprise Clinical Platform is testament to the rising brand recognition of Merge in the marketplace, where it is increasingly being perceived as a mark of innovation and quality. Merge s technology platform is also a high quality asset for the company, in that it is driving cross-selling opportunities for new solution components, while also boosting the recurring revenue opportunity. These increasing revenues streams are extremely valuable advantage in order to achieve sustainable growth in uncertain market conditions. Conclusion In recognition of the company s proactive product development, with the iconnect Enterprise Clinical Platform and the ensuing market traction, Frost & Sullivan is proud to present Merge Healthcare with the 2013 North American Product Leadership Award in Medical Imaging Interoperability Solutions. The CEO 360-Degree Perspective TM Visionary Platform for Growth Strategies The CEO 360-Degree Perspective model provides a clear illustration of the complex business universe in which CEOs and their management teams live today. It represents the foundation of Frost & Sullivan's global research organization and provides the basis on which companies can gain a visionary and strategic understanding of the market. The CEO 360-Degree Perspective is also a must-have requirement for the identification and analysis of best-practice performance by industry leaders. The CEO 360-Degree Perspective model enables our clients to gain a comprehensive, action-oriented understanding of market evolution and its implications for their companies growth strategies. As illustrated in Chart 4 below, the following six-step process outlines how our researchers and consultants embed the CEO 360-Degree Perspective into their analyses and recommendations Frost & Sullivan 6 We Accelerate Growth

8 Chart 4: The CEO's 360-Degree Perspective Model 2013 Frost & Sullivan 7 We Accelerate Growth

9 Critical Importance of TEAM Research Frost & Sullivan s TEAM Research methodology represents the analytical rigor of our research process. It offers a 360-degree view of industry challenges, trends, and issues by integrating all seven of Frost & Sullivan's research methodologies. Our experience has shown over the years that companies too often make important growth decisions based on a narrow understanding of their environment, leading to errors of both omission and commission. Frost & Sullivan contends that successful growth strategies are founded on a thorough understanding of market, technical, economic, financial, customer, best practices, and demographic analyses. In that vein, the letters T, E, A, and M reflect our core technical, economic, applied (financial and best practices) and market analyses. The integration of these research disciplines into the TEAM Research methodology providesan evaluation platform for benchmarking industry players and for creating high-potential growth strategies for our clients. Chart 6: Benchmarking Performance wi th TEAM Research About Frost & Sullivan Frost & Sullivan, the Growth Partnership Company, enables clients to accelerate growth and achieve best-in-class positions in growth, innovation and leadership. The company's Growth Partnership Service provides the CEO and the CEO's Growth Team with disciplined research and best-practice models to drive the generation, evaluation and implementation of powerful growth strategies. Frost & Sullivan leverages 50 years of experience in partnering with Global 1000 companies, emerging businesses and the investment community from more than 40 offices on six continents. To join our Growth Partnership, please visit Frost & Sullivan 8 We Accelerate Growth