Note 3 - Discontinued Operations

12 Months Ended

Dec. 31, 2025

Notes to Financial Statements

Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]

3. Discontinued operations

On December 13, 2024, the Company’s Board of Directors discussed and approved a divestiture plan to sell and transfer about 90% to 100% of the Company’s interests in SEED to potential investors at a determined price. The divestiture of SEED represents a strategic shift in the Company’s reallocation and optimization of the available resources to pipelines with greater potential. In accordance with ASC 205-20, all assets and liabilities of SEED were classified as held-for-sale in the consolidated balance sheet as of December 31, 2024 and 2025, and the results of operations of SEED were reflected as discontinued operations in the consolidated statement of operations for the years ended December 31, 2024 and 2025.

On January 24, 2025, the Company entered into a Preferred Share Purchase Agreement (each, an “Agreement” and collectively, the “Agreements”) with each of Winning View Investment Limited, a business company organized in the BVI, FULL TECH CORPORATE DEVELOPMENT LIMITED, a business company organized in the BVI, and Mapfil Investment Limited, a limited company organized in Hong Kong, respectively (each, a “Purchaser” and collectively, the “Purchasers”). On February 17, 2025, the Company and Winning View Investments Limited entered into the First Amendment to Purchase Agreement (the “Amendment”). Pursuant to the Agreements and the Amendment, the Company agreed to sell a total of 8,333,637 Series A-1 Preferred Shares (the “Shares”) of SEED to the Purchasers at a price per share of $4.25, in exchange of aggregate cash proceeds of $35,418.

The Agreements, as amended, will be executed in three separate closings as described below. The below ownership percentage for the First Closing is calculated after taking into account the issuance of an aggregate of 5,647,059 Series A-3 Preferred Shares in August 2024, and the ownership percentages for the Second Closing and Third Closing are calculated after taking into account the additional issuance of an aggregate of 1,411,761 Series A-3 Preferred Shares in September 2025, assuming there is no other changes to SEED’s share capital prior to such Closings and excluding any shares that may be reserved under an employee stock ownership plan or similar arrangement.

(i) On February 19, 2025, the First Closing (as defined in each Agreement, as amended) was completed. The Company sold and transferred a total of 1,730,454 Shares, comprised of 980,427 Shares to Winning View Investment Limited, 250,009 Shares to FULL TECH CORPORATE DEVELOPMENT LIMITED and 500,018 Shares to Mapfil Investment Limited. Immediately upon the First Closing, the Company’s direct and indirect ownership in SEED decreased to 40.12%, but still retained the controlling interest of SEED through the control of the SEED Board. The Company’s noncontrolling interests increased by 6.75% upon the First Closing.

(ii) At the Second Closing (as defined in each Agreement, as amended, which management expects to be completed in 2026), the Company will sell and transfer to the Purchasers a total of 3,103,055 Shares, comprised of 1,436,327 Shares to Winning View Investment Limited, 555,576 Shares to FULL TECH CORPORATE DEVELOPMENT LIMITED and 1,111,152 Shares to Mapfil Investment Limited. Immediately upon the Second Closing, the Company’s direct and indirect ownership in SEED will further decrease to 26.56%. The Company will lose the controlling interest of SEED due to the loss of control of the SEED Board.

(iii) At the Third Closing (as defined in each Agreement, as amended, which shall be no later than December 15, 2026), the Company will sell and transfer to the Purchasers a total of 3,500,128 Shares, comprised of 1,750,064 Shares to Winning View Investment Limited, 583,355 Shares to FULL TECH CORPORATE DEVELOPMENT LIMITED and 1,166,709 Shares to Mapfil Investment Limited. Immediately upon the Third Closing, the Company’s direct and indirect ownership in SEED will ultimately decrease to 13.62%.

The Company determined that the multiple arrangements of the SEED sales with the Purchasers and the three-tranche closings should be accounted for as a single transaction in accordance with ASC 810-10-40-6, as the transactions were entered in contemplation of one another and were essentially a single transaction designed to achieve an overall commercial effect.

The following tables set forth the assets, liabilities, statement of operations, and cash flows of discontinued operations which were included in the Company’s consolidated financial statements (in thousands).

	As of December 31,
	2024		2025
Assets
Current assets:
Cash and cash equivalents	$	13,125	$	4,352
Short-term investments		12,044		3,531
Advances to suppliers		86		117
Prepaid expenses and other current assets		92		23
Total current assets		25,347		8,023
Noncurrent assets:
Property and equipment, net		1,323		1,373
Operating right-of-use assets		3,182		2,683
Other noncurrent assets		268		300
Total noncurrent assets		4,773		4,356
Total assets	$	30,120	$	12,379
Liabilities and equity
Current liabilities:
Short-term loans	$	3,911	$	4,369
Accounts payable		505		361
Accrued expenses		1,354		3,105
Current portion of operating lease liabilities		400		430
Deferred revenue		2,001		2,001
Other current liabilities		642		867
Total current liabilities		8,813		11,133
Noncurrent liabilities:
Operating lease liabilities		2,375		1,945
Deferred revenue		3,822		1,821
Total noncurrent liabilities		6,197		3,766
Total liabilities	$	15,010	$	14,899

	Year ended December 31,
	2024			2025
Revenue	$	2,001		$	2,001
Operating expenses
Research and development		(7,503	)		(10,853	)
General and administrative		(2,660	)		(3,929	)
Loss from operations		(8,162	)		(12,781	)
Foreign exchange gain, net		-			1
Interest income		149			176
Other income, net		185			116
Loss before income tax		(7,828	)		(12,488	)
Income tax expense		-			-
Net loss from discontinued operations		(7,828	)	$	(12,488	)

	Year ended December 31,
	2024			2025
Net cash used in discontinued operating activities	$	(7,665	)	$	(12,314	)
Net cash provided by (used in) discontinued investing activities	$	(12,012	)	$	8,207
Net cash provided by discontinued financing activities	$	23,815		$	2,980

In connection with the First Closing, the Company recorded a gain on the sale of subsidiary interests:

	Gain recognized on the First Closing
Fair value of consideration received	$	7,354
Less: Adjustments to noncontrolling interests (6.75% of the equity interests)		368
Gain on sale of subsidiary interests	$	6,986