Suelos:

NovioGendix

The Company signed a sale and purchase agreement on September 18, 2015 to acquire all shares and voting interests of NovioGendix, an entity incorporated in The Netherlands.

NovioGendix, a privately held company based in Nijmegen (The Netherlands), is a molecular diagnostic research and service company providing an expert-based, integrated approach in developing advanced and clinically useful molecular diagnostic assays for the uro-oncological practice. The Company is now active in the discovery and subsequent (clinical) validation and further product development and commercialization of biomarker-based diagnostic tests for prostate- bladder- and kidney cancer.

Under the terms of the agreement, MDxHealth purchased all outstanding shares of NovioGendix Holding B.V. in a combined share and cash transaction for an aggregate purchase price of $8.7 million (or €7.75 million), of which $5.1 million (or €4.5 million) was payable in new MDxHealth shares, $0,3 million (or €250,000) in cash, and up to an additional $3.3 (or €3.0 million) in cash shall, subject to meeting certain milestones, be payable in six milestone payments. In addition, MDxHealth granted NovioGendix a bridge loan of $680,000 (or €0.6 million) to repay outstanding debts of NovioGendix. As part of the consideration that was paid for the shares in NovioGendix, the Company issued 1,086,956 new shares at an issue price of EUR 4.14 representing the average closing price of the Company's shares on Euronext Brussels during a period of 30 days ending on September 17, 2015. MDxHealth has full control of the acquired entity and meets the definition of a business combination.

The fair values of the identifiable assets and liabilities acquired, purchase consideration and goodwill at the date of the acquisition were as follows:

ASSETS Carrying Value at acquisition date Fair Value adjustments Fair value at acquisition date Intangible assets - 7,800 7,800

Property plant and equipment 16 - 16

Non-current assets 16 7,800 7,816

Trade and other receivables 153 - 153

Cash and cash equivalents 40 - 40

Current assets 193 - 193

TOTAL ASSETS 209 7,800 8,009

EQUITY AND LIABILITIES

Long-term liabilities - 1,390 1,390

Deferred tax liabilities - 842 842

Non current liabilities - 2,232 2,232

Trade payables 12 - 12

Other current liabilities 769 - 769

Short-term liabilities - 820 820

Current liabilities 781 820 1,601

TOTAL EQUITY AND LIABILITIES 781 3,052 3,833

Total identified assets and liabilities other than goodwill 4,176

Goodwill 1,145

The cash flow from the business combination is as follows:

Cash and cash equivalents 40

Acquisition price paid in cash (280)

Total cash flow (240)

Since the acquisition date, NovioGendix has contributed $131,000 to the Company’s group revenues and $ 274,000 to the Company’s group result (net losses). If the acquisition had occurred on 1 January 2015, the total revenue generated by NovioGendix for the full-year of 2015 is $280,000 (€250,000) and the net loss for the same period is $811,000 (€724,000).

Contingent Considerations or future earn outs:

The valuation of the contingent liability related to defined earn out was developed based on the probability of attainment, the estimated time to attainment, and application of various discount rates. The contingent liability valued as of December 31, 2015 is $2,260,000, which is the valuation of the future earn out based on the defined milestones.

Intangible Asset Valuation: Given that NovioGendix

has innovated and developed unique and potentially proprietary technology, the value of the Company is in part derived from the technology already developed and technology in the process of being developed.

Developed Technologies – Intangible Asset:

MDxHealth has acquired as part of the NovioGendix acquisition the following developed technologies:

 Design and development of SelectMDx, a urinary 3-gene RNA panel for the identification of patients with clinically significant Prostate Cancer and also with low serum PSA values utilizing existing qPCR processing.

 SelectMDx is fully validated assay by NovioGendix and documented to outperform the current IVD PCA3 test

The multi-period excess earnings method, a variation of the income approach, estimates an intangible asset’s value based on the present value of the incremental after-tax cash flows (or “excess earnings”) attributable only to the intangible asset. This method was used to value the existing Developed Technology as of the effective date, September 18, 2015. Based on this method, the indicated value for the developed technology (SelectMDx) is calculated to be $4,500,000.

In-process Research and Development – Intangible Asset:

In-process research and development (“IPR&D”) can be broadly defined as acquired research and development assets that have been initiated, achieved material progress, but have not yet resulted in a technologically feasible or commercially viable project.

The AssureMDx Bladder cancer assay is in the process of development with the expected to be completed in late 2016 to early 2017.

 The AssureMDx Bladder assay is a similar test to the SelectMDx assay for Prostate cancer in its positioning to assist in the early diagnosis of Bladder cancer and as a diagnostic tool to assist urologist to identify potential Bladder cancer patients who are negative and not in need of repeat cystoscopies. AssureMDx is an invasive urine based assay that will be easy for urologist to adopt. Into their practice. The estimated market size for AssureMDx is over $500 million.

Similar to the valuation method used for the developed technology, the multi-period excess earnings method was applied to assess the value for the in-process research and development intangible. Based on this method, the indicated value for the in-process research and development asset (AssureMDx) is calculated to be $3,300,000. Residual Value of Goodwill prior to Deferred Tax Liability Adjustment:

The residual value of goodwill taking into account the intangible assets, the developed technology (SelectMDx) at $4.5 million and the in-process research and development asset (AssureMDx) at $3.3 million, and the tangible assets of $209,000, relative to the purchase consideration is $303,000. The material value of the acquisition is attributable to the acquired technology and minimally to goodwill.

Deferred Tax Liability Adjustment:

NovioGendix since 2006 had generated net operating losses (NOLs) of €4,353,946 which would have become a Deferred Tax Asset, once it became a profitable entity. The value of the NOLs at the tax rate of 20% for the first $220,000 and 25% thereafter would yield a tax benefit of $1,108,252. Conversely, the Deferred Tax Liability on the Intangible Asset value of $7,800,000, the $4,500,000 for the developed technology and the $3,300,000 for the in-process research and development asset at the aforementioned tax rate would yield a value of $1,950,000. Since the deferred tax liability is greater than the deferred tax asset value by $841,748, the residual goodwill $303,000 is adjusted to $1,144,748.