Prepress

Monotype Imaging Reports Inducement Grants Under Nasdaq Marketplace Rule 5635(c)

Wednesday 08. December 2010 - Monotype Imaging Holdings Inc. (Nasdaq: TYPE), a leading global provider of text imaging solutions, today announced that in association with its Dec. 8, 2010 acquisition of Ascender Corp., and in compliance with Nasdaq Marketplace Rule 5635(c), Monotype Imaging has granted equity awards as inducement awards to employees of Ascender who are now joining Monotype Imaging.

Under the terms of the agreement, Monotype Imaging has purchased Ascender Corp. for $10.2 million, net of acquired assets, split between cash ($7.0 million) and shares of restricted common stock ($3.2 million). Additional shares of restricted common stock and non-qualified stock options with an aggregate value of $1.8 million will be provided to certain employees of Ascender in connection with their employment by Monotype Imaging.
As part of the consideration for the transaction, Monotype Imaging has awarded 71,948 shares of restricted common stock to Ira Mirochnick, the former president of Ascender who is becoming the vice president and general manager of Monotype Imaging’s Display Imaging group, and 32,703 shares of restricted common stock to each of Brian P. Kraimer, Steven J. Kuhlman, William N. Davis and Steven R. Matteson. An additional three employees have also been awarded an aggregate of 49,056 shares of restricted common stock at the close of the transaction.
In addition to these awards, the compensation committee of Monotype Imaging’s board of directors has approved the grant of additional equity awards as an inducement to the five principals named above and an additional four employees. Mirochnick, Davis, Kraimer, Kuhlman, and Matteson will receive 8,781, 5,914, 8,781, 8,781 and 5,914 shares of restricted common stock and 30,078, 20,001, 30,078, 30,078 and 20,001 non-qualified stock options, respectively. The other four employees will receive an aggregate of 15,592 shares of restricted common stock and 52,981 non-qualified stock options. These awards will be issued on Dec. 8, 2010, with the exercise price of the stock options equal to the closing market price on the Nasdaq Global Select Market on Dec. 8, 2010. The shares of restricted common stock shall be issued to each individual with no payment by such individual for the shares.
All equity awards described above vest as follows: 25 percent on the first anniversary date of the acquisition and the remaining shares vesting in equal quarterly installments over the following three years, with all shares fully vested by the fourth anniversary of the acquisition. All equity awards granted in connection with the acquisition require that the respective recipient continue to be an employee of Monotype Imaging through each applicable vesting date and are subject to possible accelerated vesting under certain circumstances. The stock options have a term of 10 years.
All the inducement awards were approved by the compensation committee of Monotype Imaging’s board of directors on Dec. 7, 2010, in each case subject to the closing of the transaction.