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Asset Acquisition of Razor Genomics, Inc. (Tables)

3 Months Ended

Mar. 31, 2021

Equity Method Investments and Joint Ventures [Abstract]

Summary of Acquisition Intangible Assets

On February 24, 2021, upon Oncocyte’s acquisition of the outstanding common stock of Razor, the Razor intangible asset balance recorded on the acquisition date and included in Intangible Assets was as follows (in thousands):

		As of February 24, 2021
Razor intangible asset recorded on the acquisition date:
Equity method investment carrying value		$	13,147
Cash paid as Additional Purchase Payment for the Razor asset			10,000
Oncocyte common stock issued (982,318 shares issued at market value) as Additional Purchase Payment			5,756
Less: cash balance received from Razor for Clinical Trial expenses			(3,352)
Deferred tax liability generated from the Razor asset (Note 12)			7,564
Other			169

Total Razor investment asset balance as of February 24, 2021 (a)		$	33,284

(a)

This balance will be amortized over the remaining useful life of the Razor asset, approximating 8.5 years, as of the February 24, 2021 acquisition date, with the amortization expense included in “Cost of revenues – amortization of acquired intangibles” on the consolidated statements of operations.

Schedule of Condensed Statement of Operations

The unaudited standalone results of operations for Razor prior to being consolidated with Oncocyte is summarized below (in thousands):

Condensed Statement of Operations ⁽¹⁾		For the period from January 1, 2021 through February 23, 2021 (unaudited)
Research and development expense		$	125
General and administrative expense			-
Loss from operations			(125)
Net loss		$	(125)

(1)

The condensed standalone statement of operations of Razor is provided for informational purposes only. Razor’s results for the period from January 1, 2021 through February 23, 2021 are not included in Oncocyte’s consolidated results of operations because Razor was not consolidated with Oncocyte’s financial statements but had been accounted for under the equity method of accounting since the September 30, 2019 Initial Closing date, however, Oncocyte’s results included its pro rata losses from Razor. Beginning on February 24, 2021, Razor’s results are included with Oncocyte’s consolidated results, primarily consisting of outside research and development expenses incurred by Razor for the Clinical Trial discussed above.