Note 17 - Related Party Transactions

12 Months Ended

Dec. 31, 2019

Notes to Financial Statements

Related Party Transactions Disclosure [Text Block]

NOTE

17

. RELATED PARTY TRANSACTIONS     

Related Party Financing

See Note

9,

“Related Party Notes Payable” for a description of the Promissory Note issued on

February 27, 2019,

as amended on

June 25, 2019

and Note

12,

“Stockholders’ Equity” for a description of the Company’s financing transactions in

June 2019

and

August 2019.

Related Party Revenue 

The Company recognized related party revenues from product sales and license and collaboration fees of

$250

thousand,

$77

thousand, and

$27

thousand for the years ended

December 31, 2019,

2018

and

2017,

respectively. In fulfillment of the performance obligations under the Purchase Agreement with China Pioneer, the Company supplied product samples with a cost of

$176

thousand,

$426

thousand, and

$102

thousand for the years ended

December 31, 2019,

2018

and

2017,

respectively. These costs were recorded as a sales and marketing expense. Related party accounts receivable was

$0

and

$39

thousand as of

December 31, 2019

and

December 31, 2018,

respectively. See Note

14,

“License, Collaboration and Distribution Agreements” for additional information regarding the Company's distribution agreements with China Pioneer, the Company's

second

largest stockholder.

Related Party Expenses 

The Company recognized related party commission expense of

$326

thousand,

$359

thousand, and

$0

for the years ended

December 31, 2019,

2018

and

2017,

respectively. The Company paid China Kington a fee of

$20

thousand,

$144

thousand and

$162

thousand in the first,

second

and

third

quarter of

2019,

respectively. The

first

quarter fee represented the broker fee for the issuance of the Promissory Note to Pioneer Hong Kong. The

second

quarter fee represented the commission for the private placement with

three

accredited investors which closed on

June 26, 2019.

The

third

quarter fee represented the commission for the private placement with

three

accredited investors which closed on

August 8, 2019.

All of the fees were recorded as an offset to the additional paid-in capital in the consolidated balance sheet. For the year ended

December 31, 2019,

$18

thousand was recorded to interest expense using the effective interest rate method over the term of the Promissory Note. See Note

12,

“Stockholders’ Equity” for additional information regarding such commissions.

A fee of

$50

thousand was paid to Director Bob Wu in the

first

quarter of

2019

and represented the consulting fees pursuant to that certain Consulting Agreement, between the Company and China Kington, dated

March 11, 2019.

The Company recorded an

$83

 thousand expense related to Mr. Wu’s consulting service for the year ended

December 31, 2019. 

The Company paid an additional fee of

$50

thousand to Mr. Wu in

March 2020

pursuant to the Consulting Agreement. See Note

9,

“Related Party Notes Payable” for additional information regarding such fees.

The fees paid to China Kington during the year ended

December 31, 2018

represented the commission on its sale of the Company’s common stock. See Note

12,

“Stockholders’ Equity” for additional information regarding such commissions.