NOTE 3  ACQUISITION: Orangelife On November 25, 2019, pursuant to a quota purchase agreement, the Company acquired all of the outstanding equity securities of Orangelife Comercio e Industria Ltda. (Orangelife), a privately held Brazilian company, which is an original equipment manufacturer of point-of-care tests approved by the Brazilian Health Surveillance Agency (Agencia Nacional de Vigilancia Sanitaria, or ANVISA) for infectious diseases that include human immunodeficiency virus (HIV), Hepatitis C, Zika, Chikungunya and Dengue Fever. Orangelife tests are manufactured in its Rio de Janeiro facility, which is ISO-certified and approved by ANVISA to produce Class II/III/IV medical devices. The purchase price includes the following consideration:  $150,000 in cash and 153,707 shares of common stock.  Issuance of 316,456 shares of common stock to the founder and former chief executive officer of Orangelife, based on the transfer and approval of registration of certain of our product in Brazil prior to November 25, 2022. All of the shares may be deliverable in the event of change in control of Chembio. The number of shares issued was subject to adjustments based upon Orangelifes working capital at closing. The fair value of the shares on the date of the acquisition was recorded in equity and was valued at $1.2 million. The purchase consideration is subject to routine post-closing adjustments. The acquisition of Orangelife allowed the Company to expand its commercial presence by offering its products to the state, private and pharmacy markets in Brazil, in addition to providing local support to its long-time customer Bio-Manguinhos, a subsidiary of the Oswaldo Cruz Foundation (Fiocruz), which oversees development and production of vaccines, diagnostics, and biopharmaceuticals to meet the demands of Brazils national public health system. The results of Orangelifes operations have been reflected in the consolidated financial statements since November 25, 2019. The acquisition was accounted for using the purchase method of accounting. The following table summarizes the allocation of the purchase price to the estimated fair values of the assets acquired and liabilities assumed on the closing date of November 25, 2019: Amount Net current assets $ 320,293 Property, plant and equipment and other assets 226,035 Inventory 289,205 Goodwill 986,058 Deferred tax liability (50,000 ) Other intangible assets (estimated useful life): Trade name (0.5 years) 5,000 Customer contracts / relationships (5 years) 195,000 Total consideration $ 1,971,591 The Company calculated the fair value of the fixed assets based on the net book value of Orangelife as that approximates fair value. The trade name, customer contracts/relationships and contingent earnouts were based on discounted cash flows using management estimates. As a result of the consideration paid exceeding the fair value of the net assets acquired, goodwill in the amount of $986,058 was recorded in connection with this acquisition, none of which will be deductible for tax purposes. In addition, the Company recorded $200,000 in intangible assets associated with the addition of Orangelifes trade name and customer base. The following represents pro forma operating results for the year ended December 31, 2019 as if the operations of Orangelife had been included in the Companys consolidated statements of operations effective as of January 1, 2019. This pro forma financial information is unaudited and presented for illustrative purposes only and is not necessarily indicative of the operating results that would have occurred if the acquisition of Orangelife and the other transactions contemplated by this acquisition had been completed as of January 1, 2019, nor is it necessarily indicative of the future operating results of the Company and Orangelife on a combined and consolidated basis. Unaudited Pro Forma December 31, 2019 Total revenues $ 35,157,248 Net loss $ (13,654,001 ) Net loss per common share $ (0.80 ) Diluted net loss per common share $ (0.80 )