Sec Form 4 Filing - Hammond Kurt R. @ MERGE HEALTHCARE INC - 2015-10-13

FORM 4 Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934, Section 17(a) of the Public Utility Holding Company Act of 1935 or Section 30(h) of the Investment Company Act of 1940

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1. Name and Address of Reporting Person Hammond Kurt R. 2. Issuer Name and Ticker or Trading Symbol MERGE HEALTHCARE INC [ MRGE] 5. Relationship of Reporting Person(s) to Issuer (Check all applicable) _____ Director _____ 10% Owner X __ Officer (give title below) _____ Other (specify below) President, Sales & Marketing (Last) (First) (Middle) 350 NORTH ORLEANS STREET, FIRST FLOOR 3. Date of Earliest Transaction (MM/DD/YY) 10/13/2015 (Street) CHICAGO, IL60654 4. If Amendment, Date Original Filed (MM/DD/YY) 6. Individual or Joint/Group Filing (Check Applicable Line) __ X __ Form filed by One Reporting Person _____ Form filed by More than One Reporting Person (City) (State) (Zip)

Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned 1.Title of Security (Instr. 3) 2. Transaction Date (MM/DD/YY) 2A. Deemed Execution Date, if any (MM/DD/YY) 3. Transaction Code (Instr. 8) 4. Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5) 5. Amount of Securities Beneficially Owned Following Reported Transaction(s) (Instr. 3 and 4) 6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4) 7. Nature of Indirect Beneficial Ownership (Instr. 4) Code V Amount (A) or (D) Price Common Stock 10/13/2015 D 50,230 D $ 7.13 ( 1 ) 0 D Restricted Common Stock 10/13/2015 D 150,750 D 0 D

Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned ( e.g. , puts, calls, warrants, options, convertible securities) 1. Title of Derivative Security (Instr. 3) 2. Conversion or Exercise Price of Derivative Security 3. Transaction Date (MM/DD/YY) 3A. Deemed Execution Date, if any (MM/DD/YY) 4. Transaction Code (Instr. 8) 5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4, and 5) 6. Date Exercisable and Expiration Date (MM/DD/YY) 7. Title and Amount of Underlying Securities (Instr. 3 and 4) 8. Price of Derivative Security (Instr. 5) 9. Number of Derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4) 10. Ownership Form of Derivative Security: Direct (D) or Indirect (I) (Instr. 4) 11. Nature of Indirect Beneficial Ownership (Instr. 4) Code V (A) (D) Date Exercisable Expiration Date Title Amount or Number of Shares Stock Options $ 2.5 10/13/2015 D 100,000 ( 3 ) 05/03/2016 Common Stock 100,000 $ 4.63 ( 3 ) 0 D Stock Options $ 3.09 10/13/2015 D 25,000 ( 4 ) 04/04/2019 Common Stock 25,000 $ 4.04 ( 4 ) 0 D

Reporting Owners Reporting Owner Name / Address Relationships Director 10% Owner Officer Other Hammond Kurt R. 350 NORTH ORLEANS STREET FIRST FLOOR CHICAGO, IL60654 President, Sales & Marketing Signatures /s/ Julie Ann B. Schumitsch, by Power of Attorney for Kurt R. Hammond 10/15/2015 Signature of Reporting Person Date

Explanation of Responses:

( 1 )Disposed of pursuant to the Agreement and Plan of Merger dated as of August 6, 2015, by and among International Business Machines Corporation ("IBM"), Datong Acquisition Corp. and Issuer, Merge Healthcare Incorporated (the "Merger"), in which the Issuer's holders of common stock, as of the effective time of the Merger, October 13, 2015, were entitled to receive $7.13 per share of common stock (the "Merger Consideration"). ( 2 )This Restricted Stock Award ("RSA") granted pursuant to the 2005 Equity Incentive Plan (a Rule 16b-3 shareholder approved employee benefit plan) of Issuer, originally provided for the restrictions on such shares to lapse to the extent of thirty three percent (33%) on each of November 5, 2014 and November 5, 2015, and thirty four percent (34%) on November 5, 2016, subject to additional terms and conditions as set forth in the Reporting Person's RSA agreement. Pursuant to the Merger, the remaining shares outstanding under the RSA were cancelled in exchange for a cash payment equal to the Merger Consideration, payable on the remaining vesting dates of November 5, 2015 ($529,405.50) and November 5, 2016 ($545,445), subject to the same additional terms and conditions as set forth in the Reporting Person's RSA agreement. ( 3 )This Nonqualified Stock Option granted on May 4, 2010, which vested in four (4) equal annual installments to purchase 25,000 shares of Common Stock on each of May 4, 2011, May 4, 2012, May 4, 2013 and May 4, 2014, was cancelled at the effective time of the Merger in exchange for a cash payment of $463.000, less applicable withholding taxes, representing the difference between the exercise price of the option and the Merger Consideration. ( 4 )This Nonqualified Stock Option granted on April 5, 2013, which vested in four (4) equal annual installments to purchase 6,250 shares of Common Stock on each of April 5, 2014, April 5, 2015, April 5, 2016 and April 5, 2017, was cancelled at the effective time of the Merger in exchange for a cash payment of $50,500, less applicable withholding taxes, representing the difference between the exercise price of the option and the Merger Consideration, with respect to those 12,500 options that were vested at the Merger. The 12,500 options that had not yet vested at the Merger will be converted into an option to acquire shares of common stock of IBM, on substantially the same terms and conditions as were applicable to such option prior to the Merger.

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