On April 30, 2020 (“the acquisition date”), we acquired 100% of the outstanding common shares and voting interest of Exalenz, a Modi’in, Israel based provider of the BreathID

Breath Test Systems (“BreathID”), a breath test platform for the detection of

Helicobacter pylori.

Cash consideration totaled 168.6 million New Israeli Shekels (“NIS”), which equated to $48,237 at the date of closing. Including debt assumed and repaid shortly after closing, the total consideration transferred was $56,305. To finance the acquisition, the Company utilized cash and cash equivalents on hand and proceeds drawn from our revolving credit facility (see Note 11). In anticipation of the transaction, we executed forward currency contracts to acquire the NIS required for the acquisition. As a result, the net cash outlay for the transaction prior to the repayment of debt was $47,392.

As a result of total consideration exceeding the fair value of the net assets acquired, goodwill in the amount of $24,798 was recorded in connection with this acquisition, none of which will be deductible for U.S. tax purposes. The goodwill results largely from our ability to market and sell the BreathID platform through our established customer base and distribution channels.

The Company’s consolidated results for the three and nine months ended June 30, 2021 and 2020 include the following from Exalenz:


	Three Months						Nine Months
	Ended June 30,						Ended June 30,
	2021			2020			2021			2020
Net revenues	$	4,836		$	1,308		$	10,718		$	1,308
Net loss	$	(497	)		(932	)		(2,236	)		(932	)

These results, which are reported as part of the Diagnostics segment, include amortization expense related to specific identifiable assets recorded in the purchase price allocation, including a

non-compete

agreement, trade name, technology and customer relationships, totaling $720 and $2,240 for the three and nine months ended June 30, 2021, respectively; $448 for both the three and nine months ended June 30, 2020.

The recognized amounts of identifiable assets acquired and liabilities assumed in the acquisition of Exalenz are as follows:


	April 30, 2020
Fair value of assets acquired -
Cash	$	5,006
Accounts receivable		637
Inventories		4,026
Other current assets		2,676
Property, plant and equipment		528
Goodwill		24,798
Other intangible assets (estimated useful life):
Non-compete agreement (5 years)		110
Trade name (10 years)		3,860
Technology (15 years)		6,120
Customer relationships (10 years)		20,640
Right-of-use assets		1,311
Deferred tax assets, net		6,780

		76,492


Fair value of liabilities assumed -
Accounts payable and accrued expenses (including current portion of lease and government grant obligations)		8,008
Long-term lease obligations		1,096
Long-term government grant obligations		10,792
Other non-current liabilities		291

		20,187

Total consideration paid (including $8,068 to pay off long-term debt)	$	56,305

During the three months ended June 30, 2021, the purchase price allocation was finalized.

Pro Forma Information

The following table provides the unaudited condensed consolidated pro forma results for the periods presented as if Exalenz had been acquired as of the beginning of fiscal 2020 (October 1, 2019). Pro forma results do not include the effect of any synergies achieved or anticipated to be achieved from the acquisition, and accordingly, are not necessarily indicative of the results that would have occurred if the acquisition had occurred on the date indicated or that may result in the future.


	Three Months Ended June 30,				Nine Months Ended June 30,
	2021		2020		2021		2020
Net revenues	$	63,511	$	85,083	$	241,692	$	196,978
Net earnings		11,669		27,403		64,750		38,433

These unaudited pro forma amounts have been calculated by including the results of Exalenz and adjusting the results to give effect to the following, as if the acquisition had been consummated on October 1, 2019, together with the consequential tax effects thereon:


	Three Months Ended June 30,					Nine Months Ended June 30,
	2021		2020			2021		2020
Adjustments to net revenues
Exalenz pre-acquisition net revenues	$	—	$	286		$	—	$	7,464

Adjustments to net earnings
Exalenz pre-acquisition net loss	$	—	$	(4,919	)	$	—	$	(6,423	)
Pro forma adjustments:
Meridian acquisition-related costs		—		1,641			—		3,428
Exalenz transaction-related costs		—		4,104			—		4,550
Gain on Exalenz purchase price currency contracts		—		(845	)		—		(845	)
Remove net impact of non-continuing personnel, locations or activities		—		(446	)		—		(301	)
Incremental depreciation and amortization		—		(240	)		—		(2,064	)
Interest, net		—		444			—		(328	)
Tax effects of pro forma adjustments and recognizing benefit on resulting Exalenz losses		—		157			—		723

Total adjustments to net earnings	$	—	$	(104	)	$	—	$	(1,260	)