Preliminary Purchase Price Allocation. Under the acquisition method of accounting, the identifiable assets acquired and liabilities assumed of Direct Energy, the acquiree, are recorded at fair value on the Acquisition date and added to those of NRG, the acquirer. The pro forma adjustments included herein are preliminary and based on estimates of the fair value and useful lives of the assets acquired and liabilities assumed and have been prepared to illustrate the estimated effect of the Acquisition. The table below represents an initial allocation of the preliminary estimated consideration to Direct Energy’s tangible and intangible assets to be acquired and liabilities to be assumed based on preliminary estimated fair values as of September 30, 2020. Current assets $ 2,353 Property, plant and equipment 191 Identifiable intangible assets 2,825 Other non-current assets 255 Current liabilities (1,960) Non-current liabilities (660) ▇▇▇▇▇▇▇▇ attributable to Direct Energy 621 Total Consideration $ 3,625 The preliminary fair value of the intangible assets of $2,825 million, which includes customer relationships, trade names and contracts, will be amortized over an estimated weighted average useful life of approximately 13 years. The preliminary useful lives of the intangible assets were determined based on the expected pattern of the economic benefit. The expected amortization for the quarter ended December 31, 2020 is currently estimated to be $56 million. The expected amortization for the five years following the Acquisition is currently estimated to be $225 million per year. The final purchase price allocation depends on certain valuations and other studies that have not yet been completed. The final determination of the purchase price allocation, upon the consummation of the Acquisition, will be based on the net assets acquired as of that date and will depend on a number of factors, which cannot be predicted with any certainty at this time. The purchase price allocation may change materially based on receipt of more detailed information. Accordingly, the pro forma purchase price allocation is preliminary and is subject to further adjustments as additional information becomes available and as additional analyses and final valuations are completed. There can be no assurance that these additional analyses and final valuations will not result in significant changes to the estimates of fair value set forth above.
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Preliminary Purchase Price Allocation. Under The Acquisition was accounted for under the acquisition purchase method of accounting, accounting and is being treated as a business combination in accordance with IFRS. The purchase price was preliminarily allocated based on the identifiable estimated fair value of net assets acquired and liabilities assumed of Direct Energy, at the acquiree, are recorded at fair value on the Acquisition date and added to those of NRG, the acquirer. The pro forma adjustments included herein are preliminary and based on estimates of the fair value and useful lives of the assets acquired and liabilities assumed and have been prepared to illustrate the estimated effect of the Acquisition. The table below represents an initial allocation of the preliminary estimated consideration to Direct Energy’s tangible and intangible assets to be acquired and liabilities to be assumed based on preliminary estimated fair values as of September 30, 2020. Current assets $ 2,353 Property, plant and equipment 191 Identifiable intangible assets 2,825 Other non-current assets 255 Current liabilities (1,960) Non-current liabilities (660) ▇▇▇▇▇▇▇▇ attributable to Direct Energy 621 Total Consideration $ 3,625 The preliminary fair value of the intangible assets of $2,825 million, which includes customer relationships, trade names and contracts, will be amortized over an estimated weighted average useful life of approximately 13 yearsacquisition. The preliminary useful lives of purchase price allocation is subject to further refinement and may require adjustments to arrive at the intangible assets were determined based on the expected pattern of the economic benefitfinal purchase price allocation. The expected amortization for Company expects to finalize the quarter ended December 31purchase price allocation within the context of its 2022 yearend reporting. The acquisition consideration was comprised of (in thousands): Cash $ 25,000 Stock 5,000 Contingent consideration (1) 41,006 Total acquisition consideration $ 71,006
(1) Following the closing, 2020 an additional aggregate earn-out amount of up to $70 million is currently estimated to be paid by mdxhealth to Exact Sciences upon achievement of certain revenue milestones related to fiscal years 2023 through 2025, with the maximum earn-out payable in relation to 2023 and 2024 not to exceed $56 30 million and $40 million, respectively. On a preliminary basis the contingent consideration has been assessed at $41 million. The liability recognized reflects a probability-weighted estimate at the current net present value at the date of acquisition which is expected amortization for to become payable Future fair value adjustments to this contingent consideration liability will be recognized in the five years following the Acquisition is currently estimated to be $225 million per year. The final purchase price allocation depends on certain valuations and other studies that have not yet been completed. The final determination statement of profit or loss, after finalization of the purchase price allocation. On a preliminary basis, upon and until the consummation purchase price allocation has been finalized, the purchase price in excess of the Acquisition, will be based on the fair value of net assets acquired (refer to adjustment (d) in Note 3, Pro Forma Transaction Accounting Adjustments), has been considered as of that date and residual Goodwill. Goodwill will depend on a number of factors, which cannot be predicted with any certainty amortized but will be tested for impairment at this least annually or whenever certain indicators of impairment are present. If, in the future, it is determined that goodwill is impaired, an impairment charge would be recorded at that time. The Should the final purchase price allocation may change materially based on receipt of more detailed information. Accordingly, the pro forma purchase price allocation is preliminary and is subject to further adjustments as additional information becomes available and as additional analyses and final valuations are completed. There can be no assurance that these additional analyses and final valuations will not result in significant changes additional intangible assets to be recognized, Goodwill will be decreased accordingly, and amortization charges will be applied to the estimates of fair value set forth aboveintangible assets.
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