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Merge Healthcare Provides Update on the Restatement of Its Financial Statements
Date:10/29/2007

MILWAUKEE, Oct. 29 /PRNewswire-FirstCall/ -- Merge Technologies Incorporated, doing business as "Merge Healthcare" (Nasdaq: MRGE; TSX: MRG) (the "Company"), a leading medical imaging software and services provider, announced that, in connection with the previously announced restatement of its financial statements, the Company currently expects to file, on or before December 31, 2007: (i) its restated audited financial statements for the years ended December 31, 2004, 2005, and 2006, as well as other restated financial information previously included in the Company's Annual Report on Form 10-K for the year ended December 31, 2006, (ii) its restated unaudited financial statements included in its Quarterly Report on Form 10-Q for the quarter ended March 31, 2007, and (iii) its unaudited Quarterly Reports on Form 10-Q for the quarters ended June 30, 2007 and September 30, 2007. The Company currently expects to restate revenue associated with approximately 15 software contracts valued at approximately $2 million and to recognize the associated revenue with the majority of these contracts over a 20 quarter period following completion of software installation at each respective customer site. All such contracts were signed prior to January 1, 2006. As a result of the restatement, the Company expects to report a decrease in previously reported revenues for the years ended December 31, 2004, 2005 and 2006 by an aggregate of approximately $1 million and an increase in revenue of less than $100,000 per quarter thereafter, through the expiration of the respective contract period.

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