Current reports

Execution of a purchase option agreement of Medi-Lynx asset and a loan agreement

RB: 30/2022

Date: 18.05.2022.

Legal basis: Article 17.1 MAR – confidential information

In reference to current report no. 24/2022 dated May 7, 2022 and current report no. 29/2022 dated May 14, 2022, the Management Board of Medicalgorithmics S.A. (the “Company“) announces that on May 18, 2022: (i) an option to acquire selected assets of Medi-Lynx (the “Acquisition Option“) was entered into between the Company, the Buyer – a U.S. healthcare company, Medi-Lynx Cardiac Monitoring, LLC (“Medi-Lynx“) and Medicalgorithmics US Holding Corporation (the “Holding“) and (ii) a loan agreement (the “Loan“) (the “Transaction“) was entered into between the Buyer as lender and Medi-Lynx as borrower.

Definitions used in this report have the meanings given to them in Current Report No. 24/2022 dated May 7, 2022 (the “Current Report“).

Under the Purchase Option agreement, the Buyer has the option to purchase selected assets of Medi-Lynx for the Purchase Price. The Purchase Option may be exercised within 60 days of the date on which the first tranche of the Loan is received into the bank account of the Company and Medi-Lynx. The Buyer may not exercise the Purchase Option if it fails to remit the Loan tranches in accordance with the Loan Agreement. The subject of the Purchase Option will be the Purchased Assets. The Purchased Assets will be identified in an agreement that will transfer ownership thereof to Buyer.

The Purchase Option Agreement provides that if the Buyer exercises the Purchase Option, the Company will enter into an agreement with the Buyer for the provision of support services and sale of equipment (the “Support Agreement“) on the terms and conditions specified in the Current Report.

The Purchase Option Agreement may be terminated by Medi-Lynx, for a fee of $1,000,000, if, prior to the Buyer’s exercise of the Option, Medi-Lynx receives an offer to purchase all or substantially all of its equity rights or assets for a fee higher than the Purchase Price. Such consideration is secured by the assets of Medi-Lynx. Buyer may terminate the Purchase Option agreement at any time.

The Option Purchase Agreement provides for the Buyer’s exclusive right to acquire the Purchased Assets until the earlier of (i) the expiration of the time period for exercising the Option, (ii) the filing of a petition in bankruptcy of Medi-Lynx, or (ii) the termination of the Purchase Option Agreement in accordance with its terms.

Under the Loan Agreement, Buyer will provide Medi-Lynx with a Loan of up to $2.5 million transferred as follows: $300,000 of the Loan will be transferred to Medi-Lynx on the date of the Loan Agreement and the amount of $800,000 will be transferred directly to the Company by the Buyer as payment for services and equipment provided by the Company to Medi-Lynx during the previous month.

Subsequent tranches of the Loan $800,000 and $600,000 each, will be transferred to the Company by Buyer as payment for services and equipment provided by the Company to Medi-Lynx during the preceding month, after the next 30 and 60 days.

The Loan will be available until the date the Purchase Option is exercised and subject to no breaches of the terms and conditions set forth in the Loan Agreement, specific to agreements of this nature and the representations and warranties made by Medi-Lynx. The Loan matures on November 30, 2022, subject to the immediate maturity of the Loan upon the occurrence of certain events of default.

The Purchase Option Agreement and the Loan Agreement are entered into under the laws of the State of Delaware, USA. The provisions of the Purchase Option, the Loan, the Transaction indicated in the Current Report remain in effect unless otherwise described in this report.