Document:

exv10w22

Exhibit 10.22

AMENDED AND RESTATED STOCK OPTION AGREEMENT

To: Peter Masanotti

Grant Date: September 30, 2008

     Pursuant to MedQuist’s Stock Option Plan (the “Plan”) adopted May 29, 2002 and pursuant to
this Amended and Restated Stock Option Agreement (the “Agreement”), you are hereby granted an
option, effective as of the grant date, to purchase that number of shares of common stock, no par
value per share (the “Common Stock”), of MedQuist Inc., a New Jersey corporation (“MedQuist”), set
forth on, and at the exercise price per share indicated on, the attached Grant Detail Report. Your
option price is intended to equal the higher of (i) the fair market value of the Common Stock as of
the grant date or (ii) $8.25. Your right to exercise this option will vest with respect to
one-third (1/3) of the shares subject to the option on the first anniversary of the grant date,
and, thereafter will vest semi-annually with respect to one-sixth (1/6) of the shares subject to
the option on each of the following: the date that is six months after the first anniversary of the
grant date, the second anniversary of the grant date, the date that is six months after the second
anniversary of the grant date, and the third anniversary of the grant date.

 

 

     Notwithstanding anything herein to the contrary, in the event that your employment
with MedQuist or a subsidiary corporation of MedQuist is terminated by MedQuist without
“Cause” or by you for “Good Reason” (as such terms are defined in your employment
agreement with MedQuist, dated September 3, 2008 (the “Employment Agreement”)), the
options granted hereunder shall become immediately exercisable, to the extent not already
vested. In the event of a termination of your employment for any other reason, any
unvested options granted hereunder shall be immediately forfeited. In addition, upon the
occurrence of a Change in Control, the options granted hereunder shall become immediately
exercisable, to the extent not already vested.

     For purposes of this Agreement, “Change in Control” shall mean the occurrence of any of the
following (i) the sale or disposition, in one or a series of related transactions, of all or
substantially all, of the assets of MedQuist to any “person” or “group” (as such terms are defined
in Sections 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended, or any
successor thereto (the “Act”)) other than CBaySystems Holdings Limited (“CBay”), CBay Inc. or SAC
Private Capital Group, LLC or any of their affiliates (the “Permitted Holders”); (ii) any person or
group, other than the Permitted Holders, is or becomes the “beneficial owner,” as such term is
defined in Rule 13d-3 under the Act (or any successor rule thereto) (a “Beneficial Owner”) (except
that a person shall be deemed to have “beneficial ownership” of all shares that any such person has
the right to acquire, whether such right is exercisable immediately or only after the passage of
time), directly or indirectly, of more than 50% of the total voting power of the voting stock of
MedQuist (or any entity which controls MedQuist), including by way of merger, consolidation, tender
or exchange offer or otherwise; (iii) a reorganization, recapitalization, merger or consolidation
(a “Corporate Transaction”) involving MedQuist, unless securities representing 50% or more of the
combined voting power of the then outstanding voting securities entitled to vote generally in the
election of directors of MedQuist or the corporation resulting from such Corporate Transaction (or
the parent of such corporation) are held subsequent to such transaction by the person or persons
who were the Beneficial Owners of the outstanding voting securities entitled to vote generally in
the election of directors of MedQuist immediately prior to such Corporate Transaction, in
substantially the same proportions as their ownership immediately prior to such Corporate
Transaction; (iv) during any
twelve month period, individuals who at the beginning of such period constituted the Board of
Directors of MedQuist (the “Board”) (together with any new directors whose election by such Board
or whose nomination for election by the shareholders of MedQuist was approved by a vote of a
majority of the directors of MedQuist, then still in office, who were either directors at the
beginning of such period or whose election or nomination for election was previously so approved)
cease for any reason to constitute a majority of the Board, then in office; (v) CBay ceases to own
a direct or indirect majority interest in MedQuist; or (vi) SACPEI CB Investment, L.P. ceases to
remain obligated to file a Schedule 13D pursuant to the Act in respect of its beneficial ownership
interest in MedQuist.

     This option shall terminate and is not exercisable on or after September 30, 2018, which is
the tenth anniversary of the grant date (the “Scheduled Termination Date”), except if terminated
earlier as hereafter provided.

     You may exercise your option by giving written notice to the Secretary of MedQuist on forms
supplied by MedQuist at its then principal executive office, accompanied by payment of the option
price for the total number of shares you specify that you wish to purchase. The payment may be in
cash or any manner permitted under the Plan and by MedQuist.

     Your option will, to the extent not previously exercised by you, terminate ninety (90) days
after the date you cease to perform services for MedQuist or a subsidiary corporation of MedQuist,
whether such termination is voluntary or not, but not if your termination is due to disability, as
defined in Section 22(e)(3) of the Internal Revenue Code of 1986, as amended (the “Code”), or death
(but in no event later than the Scheduled Termination Date). After that date your service or
employment is terminated, as aforesaid, you may exercise this option only for the number of shares
which you had a right to purchase and did not purchase on such termination date (except, as
provided above, upon your termination of employment by MedQuist without Cause or by you for Good
Reason). If you are employed by a subsidiary corporation of MedQuist, your employment shall be
deemed to have terminated on the date your employer ceases to be a subsidiary corporation of
MedQuist, unless you are on that date transferred to MedQuist or another subsidiary corporation of
MedQuist. Your employment shall not be deemed to have terminated if you are transferred from
MedQuist to a subsidiary corporation of MedQuist, or vise versa, or from one subsidiary corporation
of MedQuist to another subsidiary corporation of MedQuist.

     If you die while employed by MedQuist or a subsidiary corporation of MedQuist, your
legatee(s), distributee(s), executor or administrator, as the case may be, may, at any time within
one year after the date of your death (but in no event later than the Scheduled Termination Date),
exercise the option as to any shares which you had a right to purchase and did not purchase during
your lifetime. If your employment by MedQuist or a subsidiary corporation of MedQuist is terminated
by reason of your becoming disabled (within the meaning of Section 22(e)(3) of the Code and the
regulations thereunder), you or your legal guardian or custodian may at any time within one year
after the date of such termination (but in no event later than the Scheduled Terminated Date),
exercise the option as to any shares which you had a right to purchase and did not purchase prior
to such termination. Your executor, administrator, guardian or custodian must present proof of his
authority satisfactory to MedQuist prior to being allowed to exercise this option.

     Notwithstanding anything herein to the contrary, if your employment by MedQuist or a
subsidiary is terminated by MedQuist for Cause, your option shall terminate immediately in full
whether or not vested and exercisable.

     In the event of any change in the outstanding shares of the Common Stock by reason of a stock
dividend, extraordinary cash dividend, stock split, combination of shares, recapitalization,
merger, consolidation, transfer of assets, reorganization, conversion or what the Compensation
Committee of MedQuist (the “Committee”) deems in its sole discretion to be similar circumstances
the number and kind of shares subject to this option and the option price of such shares shall be
appropriately adjusted in a manner to be

 

 

determined in the sole discretion of the Committee or
replaced with equal value as determined in the sole discretion of the Committee.

     The option is not transferable otherwise than by will, the laws of descent and distribution or
pursuant to a qualified domestic relations order as defined under the Internal Revenue Code of
1986, as amended, or Title I of the Employee Retirement Income Security Act, or the rules
thereunder, and is exercisable during your lifetime only by you. Until the option price has been
paid in full pursuant to due exercise of this option and the purchased shares are delivered to you,
you do not have any right, as a shareholder of MedQuist. MedQuist reserves the right not to deliver
to you the shares purchased by virtue of the exercise of this option during any period of time in
which MedQuist, deems in its reasonable discretion, that such delivery would violate a federal,
state, local or securities exchange rule, regulation or law or any terms of this Agreement, a prior
stock option agreement or a restrictive covenant in favor of MedQuist.

     Notwithstanding anything to the contrary contained herein, this option is not exercisable
during any period of time in which MedQuist deems that the exercisability of this option, the offer
to sell the shares options hereunder, or the sale hereof, may violate a federal, state, local or
securities exchange rule, regulation or law, or may cause MedQuist to be legally obligated to issue
or sell more shares than MedQuist is legally entitled to issue or sell.

     At the time of issuance of securities pursuant to this Plan, MedQuist may require such
restrictions, legends or other provisions as it deems necessary to comply with any federal or state
securities law.

     In the event this option is in any way inconsistent with the legal requirements of the Code or
the regulations thereunder for an “incentive stock option,” this option shall be deemed
automatically amended as of the date hereof to conform to such legal requirements, if such
conformity may be achieved by amendment. The attached Grant Detail Report specifies which of your
options are intended to be incentive stock options (if any) and which are intended to be
non-qualified stock options (if any).

     This option shall be subject to the terms of the Plan as in effect on the date this option is
granted, which terms are hereby incorporated herein by reference and made a part thereof. In the
event of any conflict between the terms of this option and the terms of the Plan, the terms of the
Plan shall govern.

     This option constitutes the entire understanding between MedQuist and you with respect to the
subject matter hereof and no amendment, modification or waiver of this option, in whole or in part,
shall be binding upon MedQuist unless in writing and signed by a member or designee of the
Committee. This Agreement amends and restates, in its entirety, that certain Stock Option Agreement
from MedQuist to you dated September 30, 2008.

     Your exercise will not be completed until you have paid or made suitable arrangements to pay,
(i) all federal, state and local income tax withholding required to be withheld by MedQuist in
connection with the option exercise and (ii) the employee’s portion of other federal, state and
local payroll and other taxes due in connection with the option exercise.

     This grant is in partial consideration of your prior execution, delivery and performance of
your Employment
Agreement, which contains confidentiality, non-solicitation or other restrictive covenants
(the “Restrictive Covenants”). If you breach the terms of your Restrictive Covenants, all of the
options granted hereunder or granted to you previously shall expire immediately and the grant(s)
shall be deemed void. In the event of such a breach (as determined by the Company in its reasonable
discretion), if you have exercised any such options within 12 months prior to or any time after the
breach, you shall be obligated to refund to MedQuist immediately an amount equal to the fair value
of the Common Stock on the date of such exercise (less the exercise price paid by you) plus
subsequent increase in value of MedQuist stock. The foregoing is separate from and in addition to
any other legal or equitable remedies to which MedQuist may be entitled as a result of such a
breach. If a court determines that all or a portion of your Restrictive Covenants are not
enforceable, then this Stock Option Agreement shall be void.

     Validity, interpretation, construction, performance and enforcement of this Agreement shall be
governed by the laws of the State of New Jersey, without regard to its conflict of law principles.
The parties fully agree that the exclusive venue of any action arising out of this Agreement shall
be in the Superior Court of Burlington County, New Jersey, any other court of the State of New
Jersey having jurisdiction and value over an action arising out of this agreement, or the United
States District Court for the District of New Jersey.

     Please sign the copy of this option and return it to MedQuist’s Secretary, thereby indicating
your understanding of and agreement with its terms and conditions.

	 	 	 	 	 
	MEDQUIST INC.

 	 
	By:  	/s/ Robert Aquilina
 	 
	 	Name:  	Robert Aquilina      	 
	 	Title:  	Chairman of the Compensation Committee

(On Behalf of the Compensation Committee) 	 
	 

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I hereby acknowledge receipt of a copy of the foregoing stock option and, having read it hereby
signify my understanding of, and my agreement with, its terms and conditions.

	 	 	 	 	 

	PETER MASANOTTI

	 	(Date)	 	 
	/s/ Peter Masanotti
 

	 	March 2, 2009
 

	 	 
	(Signature)
	 	 	 	 

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Grant Detail Report

As of 9/30/2008

MedQuist

Peter Masanotti

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	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Grant	 	 	 	 	 	 	 	 	 	 
	Grant Date	 	Expiration Date	 	 	Plan ID	 	 	Grant Type	 	 	Granted	 	 	Price	 	 	Outstanding	 	 	Vested	 	 	Exercisable	 
	9/30/2008
	 	 	9/30/2018	 	 	2002SOP	 	Non-Qualified	 	 	295,749	 	 	$	8.25	 	 	 	295,749	 	 	 	0	 	 	 	0	 
	Optionee
	 	Total	 	 	 	 	 	 	 	 	 	 	295,749	 	 	 	 	 	 	 	295,749	 	 	 	0	 	 	 	0	 
	Becoming Exercisable	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

	 	 	 	 	 	 	 	 	 

	98,583 on 9/30/2009

	 	49,292 on 3/31/2010
	 	49,291 on 9/30/2010
	 	49,291 on 3/31/2011
	 	49,292 on 9/30/2011

4exv10w23

Exhibit 10.23

EXECUTION VERSION

EMPLOYMENT AGREEMENT

(Raman Kumar)

          EMPLOYMENT AGREEMENT (the “Agreement”) dated August 2, 2008 by and between CBaySystems
Holdings Limited (“Holdings”), CBay Inc. (the “Company”) and Raman Kumar (the “Executive”).

          The Company is a direct wholly-owned subsidiary of Holdings;

          The Company desires to employ Executive and to enter into an agreement embodying the terms of
such employment;

          Executive desires to accept such employment and enter into such an agreement;

          In consideration of the premises and mutual covenants herein and for other good and valuable
consideration, the parties agree as follows:

          1. Term of Employment. Subject to the provisions of Section 8 of this Agreement,
Executive shall be employed by the Company for a period commencing on the closing of the
transaction contemplated by the Stock Purchase Agreement, dated May 21, 2008, among the Company,
Holdings and Koninklijke Philips Electronics N.V. (the “Commencement Date”) and ending on December
31, 2011 (the “Employment Term”) on the terms and subject to the conditions set forth in this
Agreement.

          2. Position.

               a. During the Employment Term, Executive shall serve as the Company’s and Holdings’ Vice
Chairman and Chief Executive Officer. In such positions, Executive shall have such duties and
authority as shall be determined from time to time by the Board of Directors of Holdings (the
“Board”). If requested, Executive shall also serve as a member of the Board without additional
compensation.

               b. During the Employment Term, Executive will devote Executive’s full business time and best
efforts to the performance of Executive’s duties hereunder and will not engage in any other
business, profession or occupation for compensation or otherwise which would conflict or interfere
with the rendition of such services either directly or indirectly, without the prior written
consent of the Board; provided that Executive’s full-time status with the Company may be
reduced from time to time, as determined by the Board in consultation with Executive;
provided, further, that nothing herein shall preclude Executive, subject to the prior
approval of the Board, from accepting appointment to or continuing to serve on any board of
directors or trustees of any business corporation or any charitable organization; provided
in each case, and in the aggregate, that such activities do not conflict or interfere with the
performance of Executive’s duties hereunder or conflict with Section 9.

 

 

          3. Base Salary. During the Employment Term, the Company shall pay Executive a base
salary at the annual rate of U.S.$500,000, payable in regular installments in accordance with the
Company’s usual payment practices. Executive shall be entitled to such increases in Executive’s
base salary, if any, as may be determined from time to time in the sole discretion of the Board.
Executive’s annual base salary, as in effect from time to time, is hereinafter referred to as the
“Base Salary.”

          4. Bonuses.

               a. Annual Bonus. With respect to each full fiscal year during the Employment Term
commencing with fiscal year 2009, Executive shall be eligible to earn an annual bonus award (an
“Annual Bonus”) of up to U.S.$750,000 (the “Target”) based upon the achievement of target
performance objectives established by the Board within the first three months of each fiscal year
during the Employment Term. The Annual Bonus, if any, shall be paid to Executive during the
calendar year immediately following the year in which it is earned, as soon as practicable after
the Company receives its audited financial statements with respect to the year in which the bonus
was earned.

               b. Cash-Based Signing Bonus. Executive shall be entitled to a signing bonus in an
aggregate amount equal to U.S.$1,000,000, one-half of which shall be paid by the Company in cash on
or within 10 days following the Commencement Date, and the remaining one-half of which shall be
paid by the Company in cash on or prior to February 28, 2009, in each case, subject to Executive’s
continued employment with the Company through such dates and applicable tax withholdings.

          5. Equity Arrangements. On the Commencement Date, Holdings will grant to Executive the
right and option (the “Option”) to purchase, on the terms and conditions set forth in Holdings’
2007 Equity Incentive Plan (the “Option Plan”) and the related option award agreement, all or any
part of 3,890,200 common shares of Holdings, subject to adjustment as set forth in the Option Plan.

          6. Employee Benefits. During the Employment Term, Executive shall be entitled to
participate in the Company’s employee benefit plans as in effect from time to time (collectively
“Employee Benefits”), on the same basis as those benefits are generally made available to other
senior executives of the Company.

          7. Business Expenses. During the Employment Term, reasonable business expenses
incurred by Executive in the performance of Executive’s duties hereunder shall be reimbursed by the
Company in accordance with Company policies.

          8. Termination. The Employment Term and Executive’s employment hereunder may be
terminated by either party at any time and for any reason; provided that Executive will be required
to give the Company at least 90 days advance written notice of any resignation of Executive’s
employment. Notwithstanding any other provision of this Agreement, the provisions of this Section
8 shall exclusively govern Executive’s rights upon termination of employment with the Company and
its affiliates.

               a. By the Company For Cause or By Executive Resignation Without Good Reason.

2

 

          (i) The Employment Term and Executive’s employment hereunder may be terminated by the Company
for Cause (as defined below) and shall terminate automatically upon Executive’s resignation without
Good Reason (as defined in Section 8(c)); provided that Executive will be required to give the
Company at least 90 days advance written notice of a resignation without Good Reason.

          (ii) For purposes of this Agreement, “Cause” shall mean (A) Executive’s failure to
substantially perform Executive’s duties hereunder (other than as a result of total or partial
incapacity due to physical or mental illness) for a period of 10 days following written notice by
the Company to Executive of such failure, (B) dishonesty in the performance of Executive’s duties
hereunder, (C) Executive’s conviction of, or plea of nolo contendere to a crime
constituting (x) a felony under the laws of the United States or any state thereof or (y) a
misdemeanor involving moral turpitude, (D) Executive’s willful malfeasance or willful misconduct in
connection with Executive’s duties hereunder or any act or omission which is injurious to the
financial condition or business reputation of the Company or any of its subsidiaries or affiliates
or (E) Executive’s breach of the provisions of Sections 9 or 10 of this Agreement.

          (iii) If Executive’s employment is terminated by the Company for Cause, or if Executive
resigns without Good Reason, Executive shall be entitled to receive:

          (A) the Base Salary through the date of termination;

          (B) any Annual Bonus earned, but unpaid, as of the date of termination for the
immediately preceding fiscal year, paid in accordance with Section 4 (except to the
extent payment is otherwise deferred pursuant to any applicable deferred compensation
arrangement with the Company);

          (C) reimbursement, within 60 days following submission by Executive to the Company
of appropriate supporting documentation) for any unreimbursed business expenses properly
incurred by Executive in accordance with Company policy prior to the date of Executive’s
termination; provided claims for such reimbursement (accompanied by appropriate
supporting documentation) are submitted to the Company within 90 days following the date
of Executive’s termination of employment; and

          (D) such Employee Benefits, if any, as to which Executive may be entitled under the
employee benefit plans of the Company (the amounts described in clauses (A) through (D)
hereof being referred to as the “Accrued Rights”).

          Following such termination of Executive’s employment by the Company for Cause or resignation
by Executive without Good Reason, except as set forth in this Section 8(a)(iii), Executive shall
have no further rights to any compensation or any other benefits under this Agreement.

               b. Disability or Death.

3

 

          (i) The Employment Term and Executive’s employment hereunder shall terminate upon Executive’s
death and may be terminated by the Company if Executive becomes physically or mentally
incapacitated and is therefore unable for a period of six (6) consecutive months or for an
aggregate of nine (9) months in any twenty-four (24) consecutive month period to perform
Executive’s duties (such incapacity is hereinafter referred to as “Disability”). Any question as
to the existence of the Disability of Executive as to which Executive and the Company cannot agree
shall be determined in writing by a qualified independent physician mutually acceptable to
Executive and the Company. If Executive and the Company cannot agree as to a qualified independent
physician, each shall appoint such a physician and those two physicians shall select a third who
shall make such determination in writing. The determination of Disability made in writing to the
Company and Executive shall be final and conclusive for all purposes of the Agreement.

          (ii) Upon termination of Executive’s employment hereunder for either Disability or death,
Executive or Executive’s estate (as the case may be) shall be entitled to receive:

          (A) the Accrued Rights; and

          (B) a pro rata portion of any Annual Bonus, if any, that Executive would have been
entitled to receive pursuant to Section 4 hereof in such year based upon the percentage
of the fiscal year that shall have elapsed through the date of Executive’s termination
of employment, payable when such Annual Bonus would have otherwise been payable to
Executive pursuant to Section 4 had Executive’s employment not terminated,

          Following Executive’s termination of employment due to death or Disability, except as set
forth in this Section 8(b)(ii), Executive shall have no further rights to any compensation or any
other benefits under this Agreement.

               c. By the Company Without Cause or Resignation by Executive for Good Reason.

          (i) The Employment Term and Executive’s employment hereunder may be terminated by the Company
without Cause or by Executive’s resignation for Good Reason.

          (ii) For purposes of this Agreement, “Good Reason” shall mean (A) the failure of the Company
to pay or cause to be paid Executive’s Base Salary or Annual Bonus, when due hereunder or (B) any
substantial and sustained diminution in Executive’s authority or responsibilities from those
described in Section 2 hereof; provided that either of the events described in clauses (A)
and (B) of this Section 8(c)(ii) shall constitute Good Reason only if the Company fails to cure
such event within 30 days after receipt from Executive of written notice of the event which
constitutes Good Reason; provided, further, that “Good Reason” shall cease to exist
for an event on the 60th day following the later of its occurrence or Executive’s
knowledge thereof, unless Executive has given the Company written notice thereof prior to such
date.

          (iii) If Executive’s employment is terminated by the Company without Cause (other than by
reason of death or Disability) or if Executive resigns for Good Reason (provided

4

 

that in either such case Executive does not immediately thereafter commence employment with an
affiliate of the Company or Holdings), Executive shall be entitled to receive (commencing within 60
days following the termination date):

          (A) the Accrued Rights; and

          (B) subject to Executive’s continued compliance with the provisions of Sections 9
and 10 and to Executive’s execution and delivery of a general release of claims in favor
of the Company and its affiliates in a form prescribed by the Company within 45 days
following the termination date, continued payment of the Base Salary in accordance with
the Company’s normal payroll practices, as in effect on the date of termination of
Executive’s employment, until the earlier of (x) six months after the date of such
termination and (y) the expiration of the Employment Term determined as if such
termination had not occurred.

          Following Executive’s termination of employment by the Company without Cause (other than by
reason of Executive’s death or Disability) or by Executive’s resignation for Good Reason as
described above, except as set forth in this Section 8(c)(iii), Executive shall have no further
rights to any compensation or any other benefits under this Agreement or any other severance or
termination benefit plan sponsored or maintained by the Company.

               d. Expiration of Employment Term. Unless the parties otherwise agree in writing,
continuation of Executive’s employment with the Company beyond the expiration of the Employment
Term shall be deemed an employment at-will and shall not be deemed to extend any of the provisions
of this Agreement and Executive’s employment may thereafter be terminated at will by either
Executive or the Company; provided that the provisions of Sections 9, 10 and 11 of this
Agreement shall survive any termination of this Agreement or Executive’s termination of employment
hereunder. In the event either party elects to terminate Executive’s employment upon or after
expiration of the Employment Term, Executive shall only be entitled to receive the Accrued Rights.
Following such termination of Executive’s employment hereunder, except as set forth in this Section
8(d), Executive shall have no further rights to any compensation or any other benefits under this
Agreement.

               e. Notice of Termination. Any purported termination of employment by the Company or
by Executive (other than due to Executive’s death) shall be communicated by written Notice of
Termination to the other party hereto in accordance with Section 12(h) hereof. For purposes of
this Agreement, a “Notice of Termination” shall mean a notice which shall indicate the specific
termination provision in this Agreement relied upon and shall set forth in reasonable detail the
facts and circumstances claimed to provide a basis for termination of employment under the
provision so indicated.

               f. Board/Committee Resignation. Upon termination of Executive’s employment for any
reason, Executive agrees to resign, as of the date of such termination and to the extent
applicable, from the Board (and any committees thereof) and the Board of Directors (and any
committees thereof) of any of the Company’s affiliates.

          9. Non-Competition.

5

 

               a. Executive acknowledges and recognizes the highly competitive nature of the businesses of
the Company and its affiliates and accordingly agrees as follows:

     (1) During the Employment Term and, for a period of one year following the date Executive
ceases to be employed by the Company (the “Restricted Period”), Executive will not, whether on
Executive’s own behalf or on behalf of or in conjunction with any person, firm, partnership, joint
venture, association, corporation or other business organization, entity or enterprise whatsoever
(“Person”), directly or indirectly solicit or assist in soliciting in competition with the Company,
the business of any client or prospective client:

	 	(i)	 	with whom Executive had personal contact or dealings on
behalf of the Company during the one-year period preceding Executive’s
termination of employment;
	 
	 	(ii)	 	with whom employees reporting to Executive have had
personal contact or dealings on behalf of the Company during the one year
immediately preceding the Executive’s termination of employment; or
	 
	 	(iii)	 	for whom Executive had direct or indirect
responsibility during the one year immediately preceding Executive’s
termination of employment.

     (2) During the Restricted Period, Executive will not directly or indirectly:

	 	(i)	 	engage in any medical transcription processing services
business, physician services business or other business that competes with
the business of the Company or its affiliates (including, without
limitation, businesses which the Company or its affiliates have specific
plans to conduct in the future and as to which Executive is aware of such
planning) in any geographical area where the Company or its affiliates
manufactures, produces, sells, leases, rents, licenses or otherwise
provides its products or services (a “Competitive Business”);
	 
	 	(ii)	 	enter the employ of, or render any services to, any
Person (or any division or controlled or controlling affiliate of any
Person) who or which engages in a Competitive Business;
	 
	 	(iii)	 	acquire a financial interest in, or otherwise become
actively involved with, any Competitive Business, directly or indirectly,
as an individual, partner, shareholder, officer, director, principal,
agent, trustee or consultant; or
	 
	 	(iv)	 	interfere with, or attempt to interfere with, business
relationships (whether formed before, on or after the date of this
Agreement) between the Company or any of its affiliates, customers,
clients, suppliers or investors.

     (3) Notwithstanding anything to the contrary in this Agreement, Executive may, directly or
indirectly own, solely as an investment, securities of any Person engaged in the business of the
Company or its affiliates which are publicly traded on a national

6

 

or regional stock exchange or on the over-the-counter market if Executive (i) is not a
controlling person of, or a member of a group which controls, such person and (ii) does not,
directly or indirectly, own 2% or more of any class of securities of such Person.

     (4) During the Restricted Period, Executive will not, whether on Executive’s own behalf or on
behalf of or in conjunction with any Person, directly or indirectly:

	 	(i)	 	solicit or encourage any employee of the Company or its
affiliates to leave the employment of the Company or its affiliates; or
	 
	 	(ii)	 	hire any such employee who was employed by the Company
or its affiliates as of the date of Executive’s termination of employment
with the Company or who left the employment of the Company or its
affiliates coincident with, or within one year prior to or after, the
termination of Executive’s employment with the Company.

     (5) During the Restricted Period, Executive will not, directly or indirectly, solicit or
encourage to cease to work with the Company or its affiliates any consultant then under contract
with the Company or its affiliates.

                    b. It is expressly understood and agreed that although Executive and the Company consider the
restrictions contained in this Section 9 to be reasonable, if a final judicial determination is
made by a court of competent jurisdiction that the time or territory or any other restriction
contained in this Agreement is an unenforceable restriction against Executive, the provisions of
this Agreement shall not be rendered void but shall be deemed amended to apply as to such maximum
time and territory and to such maximum extent as such court may judicially determine or indicate to
be enforceable. Alternatively, if any court of competent jurisdiction finds that any restriction
contained in this Agreement is unenforceable, and such restriction cannot be amended so as to make
it enforceable, such finding shall not affect the enforceability of any of the other restrictions
contained herein.

          10. Confidentiality; Intellectual Property.

                    a. Confidentiality.

               (i) Executive will not at any time (whether during or after Executive’s employment with the
Company) (x) retain or use for the benefit, purposes or account of Executive or any other Person;
or (y) disclose, divulge, reveal, communicate, share, transfer or provide access to any Person
outside the Company (other than its professional advisers who are bound by confidentiality
obligations), any non-public, proprietary or confidential information —including without
limitation trade secrets, know-how, research and development, software, databases, inventions,
processes, formulae, technology, designs and other intellectual property, information concerning
finances, investments, profits, pricing, costs, products, services, vendors, customers, clients,
partners, investors, personnel, compensation, recruiting, training, advertising, sales, marketing,
promotions, government and regulatory activities and approvals — concerning the past, current or
future business, activities and operations of the Company, its subsidiaries or affiliates and/or
any third party that has disclosed or provided any of same to the Company on a confidential basis
(“Confidential Information”) without the prior written authorization of the

7

 

Board.

               (ii) “Confidential Information” shall not include any information that is (a) generally known
to the industry or the public other than as a result of Executive’s breach of this covenant or any
breach of other confidentiality obligations by third parties; (b) made legitimately available to
Executive by a third party without breach of any confidentiality obligation; or (c) required by law
to be disclosed; provided that Executive shall give prompt written notice to the Company of
such requirement, disclose no more information than is so required, and cooperate with any attempts
by the Company to obtain a protective order or similar treatment.

               (iii) Except as required by law, Executive will not disclose to anyone, other than Executive’s
immediate family and legal or financial advisors, the existence or contents of this Agreement;
provided that Executive may disclose to any prospective future employer the provisions of
Sections 9 and 10 of this Agreement provided they agree to maintain the confidentiality of such
terms.

               (iv) Upon termination of Executive’s employment with the Company for any reason, Executive
shall (x) cease and not thereafter commence use of any Confidential Information or intellectual
property (including without limitation, any patent, invention, copyright, trade secret, trademark,
trade name, logo, domain name or other source indicator) owned or used by the Company, its
subsidiaries or affiliates; (y) immediately destroy, delete, or return to the Company, at the
Company’s option, all originals and copies in any form or medium (including memoranda, books,
papers, plans, computer files, letters and other data) in Executive’s possession or control
(including any of the foregoing stored or located in Executive’s office, home, laptop or other
computer, whether or not Company property) that contain Confidential Information or otherwise
relate to the business of the Company, its affiliates and subsidiaries, except that Executive may
retain only those portions of any personal notes, notebooks and diaries that do not contain any
Confidential Information; and (z) notify and fully cooperate with the Company regarding the
delivery or destruction of any other Confidential Information of which Executive is or becomes
aware.

                    b. Intellectual Property.

               (i) If Executive has created, invented, designed, developed, contributed to or improved any
works of authorship, inventions, intellectual property, materials, documents or other work product
(including without limitation, research, reports, software, databases, systems, applications,
presentations, textual works, content, or audiovisual materials) (“Works”), either alone or with
third parties, prior to Executive’s employment by the Company, that are relevant to or implicated
by such employment (“Prior Works”), Executive hereby grants the Company a perpetual, non-exclusive,
royalty-free, worldwide, assignable, sublicensable license under all rights and intellectual
property rights (including rights under patent, industrial property, copyright, trademark, trade
secret, unfair competition and related laws) therein for all purposes in connection with the
Company’s current and future business.

               (ii) If Executive creates, invents, designs, develops, contributes to or improves any Works,
either alone or with third parties, at any time during Executive’s employment by the Company and
within the scope of such employment and/or with the use of any the Company resources (“Company
Works”), Executive shall promptly and fully disclose

8

 

same to the Company and hereby irrevocably assigns, transfers and conveys, to the maximum
extent permitted by applicable law, all rights and intellectual property rights therein (including
rights under patent, industrial property, copyright, trademark, trade secret, unfair competition
and related laws) to the Company to the extent ownership of any such rights does not vest
originally in the Company.

               (iii) Executive agrees to keep and maintain adequate and current written records (in the form
of notes, sketches, drawings, and any other form or media requested by the Company) of all Company
Works. The records will be available to and remain the sole property and intellectual property of
the Company at all times.

               (iv) Executive shall take all requested actions and execute all requested documents (including
any licenses or assignments required by a government contract) at the Company’s expense (but
without further remuneration) to assist the Company in validating, maintaining, protecting,
enforcing, perfecting, recording, patenting or registering any of the Company’s rights in the Prior
Works and Company Works. If the Company is unable for any other reason to secure Executive’s
signature on any document for this purpose, then Executive hereby irrevocably designates and
appoints the Company and its duly authorized officers and agents as Executive’s agent and attorney
in fact, to act for and in Executive’s behalf and stead to execute any documents and to do all
other lawfully permitted acts in connection with the foregoing.

               (v) Executive shall not improperly use for the benefit of, bring to any premises of, divulge,
disclose, communicate, reveal, transfer or provide access to, or share with the Company any
confidential, proprietary or non-public information or intellectual property relating to a former
employer or other third party without the prior written permission of such third party. Executive
hereby indemnifies, holds harmless and agrees to defend the Company and its officers, directors,
partners, employees, agents and representatives from any breach of the foregoing covenant.
Executive shall comply with all relevant policies and guidelines of the Company, including
regarding the protection of confidential information and intellectual property and potential
conflicts of interest. Executive acknowledges that the Company may amend any such policies and
guidelines from time to time, and that Executive remains at all times bound by their most current
version.

               (vi) The provisions of Section 10 shall survive the termination of Executive’s employment for
any reason.

          11. Specific Performance. Executive acknowledges and agrees that the Company’s
remedies at law for a breach or threatened breach of any of the provisions of Section 9 or Section
10 would be inadequate and the Company would suffer irreparable damages as a result of such breach
or threatened breach. In recognition of this fact, Executive agrees that, in the event of such a
breach or threatened breach, in addition to any remedies at law, the Company, without posting any
bond, shall be entitled to obtain equitable relief in the form of specific performance, temporary
restraining order, temporary or permanent injunction or any other equitable remedy which may then
be available. In addition, in the event of any breach of Section 9 or Section 10, in addition to
any remedies at law, the Company, without posting any bond, shall be entitled to cease making any
payments or providing any benefit otherwise required by this Agreement (which payments shall be
deemed permanently forfeited if it is established

9

 

that
Executive breached Section 9 or Section 10).

          12. Miscellaneous.

               a. Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of New York, without regard to conflicts of laws principles thereof.

               b. Entire Agreement/Amendments. This Agreement contains the entire understanding of
the parties with respect to the employment of Executive by the Company. There are no restrictions,
agreements, promises, warranties, covenants or undertakings between the parties with respect to the
subject matter herein other than those expressly set forth herein. This Agreement may not be
altered, modified, or amended except by written instrument signed by the parties hereto.

               c. No Waiver. The failure of a party to insist upon strict adherence to any term of
this Agreement on any occasion shall not be considered a waiver of such party’s rights or deprive
such party of the right thereafter to insist upon strict adherence to that term or any other term
of this Agreement.

               d. Severability. In the event that any one or more of the provisions of this
Agreement shall be or become invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions of this Agreement shall not be affected
thereby.

               e. Assignment. This Agreement, and all of Executive’s rights and duties hereunder,
shall not be assignable or delegable by Executive. Any purported assignment or delegation by
Executive in violation of the foregoing shall be null and void ab initio and of no force and
effect. This Agreement may be assigned by Holdings or the Company to a person or entity which is
an affiliate or a successor in interest to substantially all of the business operations of the
Company. Upon such assignment, the rights and obligations of the Company hereunder shall become
the rights and obligations of such affiliate or successor person or entity.

               f. Compliance with IRC Section 409A. Notwithstanding anything herein to the contrary,
(i) if at the time of Executive’s termination of employment with the Company Executive is a
“specified employee” as defined in Section 409A of the Internal Revenue Code of 1986, as amended
(the “Code”) and the deferral of the commencement of any payments or benefits otherwise payable
hereunder as a result of such termination of employment is necessary in order to prevent any
accelerated or additional tax under Section 409A of the Code, then the Company will defer the
commencement of the payment of any such payments or benefits hereunder (without any reduction in
such payments or benefits ultimately paid or provided to Executive) until the date that is six
months following Executive’s termination of employment with the Company (or the earliest date as is
permitted under Section 409A of the Code) and (ii) if any other payments of money or other benefits
due to Executive hereunder could cause the application of an accelerated or additional tax under
Section 409A of the Code, such payments or other benefits shall be deferred if deferral will make
such payment or other benefits compliant under Section 409A of the Code, or otherwise such payment
or other benefits shall be restructured, to the extent possible, in a manner, determined by the
Board, that does not

10

 

cause such an accelerated or additional tax. The Company shall consult with Executive in good
faith regarding the implementation of the provisions of this Section 12(f); provided that
neither the Company nor any of its employees or representatives shall have any liability to
Executive with respect to thereto. For purposes of Section 409A of the Code, each payment made
under this Agreement shall be designated as a “separate payment” within the meaning of the Section
409A of the Code, and references herein to Executive’s “termination of employment” shall refer to
Executive’s separation from service with the Company within the meaning of Section 409A. To the
extent any reimbursements or in-kind benefits due to Executive under this Agreement constitute
“deferred compensation” under Section 409A of the Code, any such reimbursements or in-kind benefits
shall be paid to Executive in a manner consistent with Treas. Reg. Section 1.409A-3(i)(1)(iv).

               g. Successors; Binding Agreement. This Agreement shall inure to the benefit of and be
binding upon personal or legal representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees.

               h. Notice. For the purpose of this Agreement, notices and all other communications
provided for in the Agreement shall be in writing and shall be deemed to have been duly given when
delivered by hand or overnight courier or three days after it has been mailed by United States
registered mail, return receipt requested, postage prepaid, addressed to the respective addresses
set forth below in this Agreement, or to such other address as either party may have furnished to
the other in writing in accordance herewith, except that notice of change of address shall be
effective only upon receipt.

If to the Company or to Holdings:

CBay Inc.

2661 Riva Road

Building 1000, Fifth Floor

Annapolis, Maryland 21401

Attention: General Counsel

With a copy to:

CBaySystems Holdings Limited

2661 Riva Road

Building 1000, Fifth Floor

Annapolis, Maryland 21401

Attention: General Counsel

If to Executive:

               To the most recent address of Executive set forth in the personnel records of the Company.

                    i. Executive Representation. Executive hereby represents to the

11

 

Company that the execution and delivery of this Agreement by Executive and the Company and the
performance by Executive of Executive’s duties hereunder shall not constitute a breach of, or
otherwise contravene, the terms of any employment agreement or other agreement or policy to which
Executive is a party or otherwise bound.

               j. Prior Agreements. This Agreement supercedes all prior agreements and
understandings (including verbal agreements) between Executive and the Company and/or its
affiliates regarding the terms and conditions of Executive’s employment with the Company and/or its
affiliates.

               k. Cooperation. Executive shall provide Executive’s reasonable cooperation in
connection with any action or proceeding (or any appeal from any action or proceeding) which
relates to events occurring during Executive’s employment hereunder. This provision shall survive
any termination of this Agreement.

               l. Withholding Taxes. The Company may withhold from any amounts payable under this
Agreement such Federal, state and local taxes as may be required to be withheld pursuant to any
applicable law or regulation.

               m. Counterparts. This Agreement may be signed in counterparts, each of which shall be
an original, with the same effect as if the signatures thereto and hereto were upon the same
instrument.

12

 

     IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the day and
year first above written.

	 	 	 	 	 

	CBAY INC. 
	 	RAMAN KUMAR 	 	 
	 
	 	 	 	 
	/s/
Authorized Signatory
	 	/s/ Raman Kumar 	 	 
	 

	 	 

	 	 
	By:
	 	 	 	 
	Title: Authorized
Signatory
	 	 	 	 
	 
	 	 	 	 
	CBAYSYSTEMS HOLDINGS LIMITED
	 	 	 	 
	 
	 	 	 	 
	/s/
Authorized Signatory
	 	 	 	 
	 

	 	 

	 	 
	By:
	 	 	 	 
	Title: Authorized
Signatory
	 	 	 	 

13

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