XML 24 R14.htm IDEA: XBRL DOCUMENT
v3.25.2

Convertible Redeemable Preferred Shares | 6 Months Ended
--- | ---
Jun. 30, 2025
Convertible Redeemable Preferred Shares [Abstract] |
CONVERTIBLE REDEEMABLE PREFERRED SHARES | NOTE 7 — CONVERTIBLE REDEEMABLE PREFERRED SHARES We had various series of convertible redeemable preferred shares (collectively, “Preferred Shares”) authorized and outstanding prior to April 10, 2025, the closing date of the business combination transaction with SKGR, as further discussed in Note 5 – Recapitalization Transaction. After the closing of the business combination transaction, we no longer have authorized and outstanding convertible redeemable preferred shares due to (i) the Company repurchasing a portion of Series D preferred shares from certain preferred shareholders prior to closing (the “Preferred Share Repurchase”), (ii) all remaining outstanding Preferred Shares after the Preferred Share Repurchase were automatically converted into Class A ordinary shares in connection with the business combination agreement, and (iii) contemporaneously with the closing we amended and restated our articles of association to remove preferred shares as an authorized share capital of the Company. The table below presents our various series convertible redeemable preferred shares that were authorized and outstanding as of December 31, 2024.
December 31, 2024
Series |  | Authorized |  |  | Issued and Outstanding |
A-1 |  |  | 16,518,502 |  |  |  | 15,181,000 |
A-2 |  |  | 14,244,000 |  |  |  | 14,244,000 |
A-3 |  |  | 3,536,099 |  |  |  | 2,828,899 |
B-1 |  |  | 13,111,999 |  |  |  | 13,111,999 |
B-2 |  |  | 9,090,900 |  |  |  | 9,090,900 |
B-3 |  |  | 2,100,000 |  |  |  | 2,100,000 |
C-1 |  |  | 13,684,800 |  |  |  | 13,684,800 |
D |  |  | 15,000,000 |  |  |  | 12,963,577 |
|  |  | 87,286,300 |  |  |  | 83,205,175 |
Preferred Share Repurchase On April 10, 2025, immediately prior to the Company’s Preferred Shares converting in accordance with the business combination agreement, the Company repurchased 3,017,119 Series D Preferred Shares, with a carrying amount of $138,093,537, from certain preferred shareholders in exchange for promissory notes with an aggregate principal balance of $100,000,000. The difference between the carrying value of the repurchased shares and the aggregate principal balance issued as consideration was $38,093,537, which was recorded as a decrease to the net loss attributable to the Company in determining the net loss attributable to ordinary shareholders for purposes of calculating earnings per share for the three and six months ended June 30, 2025. Conversion of Preferred Shares On April 10, 2025, after the Preferred Share Repurchase, all remaining Preferred Shares converted into 269,381,830 Class A ordinary shares. The carrying value of the Preferred Shares at the date of conversion was $2,745,357,933 and was reclassified from mezzanine equity to additional paid-in-capital. The following table presents the activity of our various series of convertible redeemable preferred shares for the three and six months ended June 30, 2025.
|  | Series A-1 Preferred Shares |  |  | Series A-2 Preferred Shares |  |  | Series A-3 Preferred Shares |  |  | Series B-1 Preferred Shares |
|  | Shares |  |  | Amount |  |  | Shares |  |  | Amount |  |  | Shares |  |  | Amount |  |  | Shares |  |  | Amount |
Beginning balances as of December 31, 2024 |  |  | 15,181,000 |  |  | $ | 485,488,380 |  |  |  | 14,244,000 |  |  | $ | 456,377,760 |  |  |  | 2,828,899 |  |  | $ | 90,666,213 |  |  |  | 13,111,999 |  |  | $ | 423,255,328 |
Preferred Shares redemption value accretion |  |  | – |  |  |  | 5,920,590 |  |  |  | – |  |  |  | 5,127,840 |  |  |  | – |  |  |  | 1,018,404 |  |  |  | – |  |  |  | 3,146,879 |
Ending balances as of March 31, 2025 |  |  | 15,181,000 |  |  |  | 491,408,970 |  |  |  | 14,244,000 |  |  |  | 461,505,600 |  |  |  | 2,828,899 |  |  |  | 91,684,617 |  |  |  | 13,111,999 |  |  |  | 426,402,207 |
Repurchase of preferred shares |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |
Conversion of preferred shares to ordinary shares |  |  | (15,181,000 | ) |  |  | (491,408,970 | ) |  |  | (14,244,000 | ) |  |  | (461,505,600 | ) |  |  | (2,828,899 | ) |  |  | (91,684,617 | ) |  |  | (13,111,999 | ) |  |  | (426,402,207 | )
Ending balances as of June 30, 2025 |  |  | – |  |  | $ | – |  |  |  | – |  |  | $ | – |  |  |  | – |  |  | $ | – |  |  |  | – |  |  | $ | – |
|  | Series B-2 Preferred Shares |  |  | Series B-3 Preferred Shares |  |  | Series C Preferred Shares |  |  | Series D Preferred Shares |  |  | Total Preferred Shares |
|  | Shares |  |  | Amount |  |  | Shares |  |  | Amount |  |  | Shares |  |  | Amount |  |  | Shares |  |  | Amount |  |  | Shares |  |  | Amount |
Beginning balances as of December 31, 2024 |  |  | 9,090,900 |  |  | $ | 295,908,795 |  |  |  | 2,100,000 |  |  | $ | 68,775,000 |  |  |  | 13,684,800 |  |  | $ | 458,577,648 |  |  |  | 12,963,577 |  |  | $ | 582,699,609 |  |  |  | 83,205,175 |  |  | $ | 2,861,748,733 |
Preferred Shares redemption value accretion |  |  | – |  |  |  | 909,090 |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | (5,063,376 | ) |  |  | – |  |  |  | 10,643,310 |  |  |  | – |  |  |  | 21,702,737 |
Ending balances as of March 31, 2025 |  |  | 9,090,900 |  |  |  | 296,817,885 |  |  |  | 2,100,000 |  |  |  | 68,775,000 |  |  |  | 13,684,800 |  |  |  | 453,514,272 |  |  |  | 12,963,577 |  |  |  | 593,342,919 |  |  |  | 83,205,175 |  |  |  | 2,883,451,470 |
Repurchase of preferred shares |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | (3,017,119 | ) |  |  | (138,093,537 | ) |  |  | (3,017,119 | ) |  |  | (138,093,537 | )
Conversion of preferred shares to ordinary shares |  |  | (9,090,900 | ) |  |  | (296,817,885 | ) |  |  | (2,100,000 | ) |  |  | (68,775,000 | ) |  |  | (13,684,800 | ) |  |  | (453,514,272 | ) |  |  | (9,946,458 | ) |  |  | (455,249,382 | ) |  |  | (80,188,056 | ) |  |  | (2,745,357,933 | )
Ending balances as of June 30, 2025 |  |  | – |  |  | $ | – |  |  |  | – |  |  | $ | – |  |  |  | – |  |  | $ | – |  |  |  | – |  |  | $ | – |  |  |  | – |  |  | $ | – |
Share Issuance On January 10, 2024, we issued 1,215,817 shares of Series D preferred shares to an accredited investor for total proceeds of $40,297,282. The following table presents the activity of our various series of convertible redeemable preferred shares for the three and six months ended June 30, 2024.
|  | Series A-1 Preferred Shares |  |  | Series A-2 Preferred Shares |  |  | Series A-3 Preferred Shares |  |  | Series B-1 Preferred Shares |
|  | Shares |  |  | Amount |  |  | Shares |  |  | Amount |  |  | Shares |  |  | Amount |  |  | Shares |  |  | Amount |
Beginning balances as of December 31, 2023 |  |  | 15,181,000 |  |  | $ | 352,502,820 |  |  |  | 14,244,000 |  |  | $ | 334,164,240 |  |  |  | 2,828,899 |  |  | $ | 66,479,127 |  |  |  | 13,111,999 |  |  | $ | 318,883,816 |
Issuance of Preferred Shares |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |
Preferred Shares redemption value accretion |  |  | – |  |  |  | 228,170,430 |  |  |  | – |  |  |  | 212,805,360 |  |  |  | – |  |  |  | 42,207,173 |  |  |  | – |  |  |  | 191,566,305 |
Ending balances as of March 31, 2024 |  |  | 15,181,000 |  |  |  | 580,673,250 |  |  |  | 14,244,000 |  |  |  | 546,969,600 |  |  |  | 2,828,899 |  |  |  | 108,686,300 |  |  |  | 13,111,999 |  |  |  | 510,450,121 |
Preferred Shares redemption value accretion |  |  | – |  |  |  | 910,860 |  |  |  | – |  |  |  | 712,200 |  |  |  | – |  |  |  | 169,734 |  |  |  | – |  |  |  | 786,720 |
Ending balances as of June 30, 2024 |  |  | 15,181,000 |  |  | $ | 581,584,110 |  |  |  | 14,244,000 |  |  | $ | 547,681,800 |  |  |  | 2,828,899 |  |  | $ | 108,856,034 |  |  |  | 13,111,999 |  |  | $ | 511,236,841 |
|  | Series B-2 Preferred Shares |  |  | Series B-3 Preferred Shares |  |  | Series C Preferred Shares |  |  | Series D Preferred Shares |  |  | Total Preferred Shares |
|  | Shares |  |  | Amount |  |  | Shares |  |  | Amount |  |  | Shares |  |  | Amount |  |  | Shares |  |  | Amount |  |  | Shares |  |  | Amount |
Beginning balances as of December 31, 2023 |  |  | 9,090,900 |  |  | $ | 230,272,497 |  |  |  | 2,100,000 |  |  | $ | 55,965,000 |  |  |  | 13,684,800 |  |  | $ | 395,627,568 |  |  |  | 11,747,760 |  |  | $ | 572,468,345 |  |  |  | 81,989,358 |  |  | $ | 2,326,363,413 |
Issuance of Preferred Shares |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 1,215,817 |  |  |  | 40,297,282 |  |  |  | 1,215,817 |  |  |  | 40,297,282 |
Preferred Shares redemption value accretion |  |  | – |  |  |  | 129,272,598 |  |  |  | – |  |  |  | 28,959,000 |  |  |  | – |  |  |  | 176,533,920 |  |  |  | – |  |  |  | 78,193,027 |  |  |  | – |  |  |  | 1,087,707,813 |
Ending balances as of March 31, 2024 |  |  | 9,090,900 |  |  |  | 359,545,095 |  |  |  | 2,100,000 |  |  |  | 84,924,000 |  |  |  | 13,684,800 |  |  |  | 572,161,488 |  |  |  | 12,963,577 |  |  |  | 690,958,654 |  |  |  | 83,205,175 |  |  |  | 3,454,368,508 |
Preferred Shares redemption value accretion |  |  | – |  |  |  | 4,545,450 |  |  |  | – |  |  |  | 147,000 |  |  |  | – |  |  |  | 1,231,632 |  |  |  | – |  |  |  | 2,592,716 |  |  |  | – |  |  |  | 11,096,312 |
Ending balances as of June 30, 2024 |  |  | 9,090,900 |  |  | $ | 364,090,545 |  |  |  | 2,100,000 |  |  | $ | 85,071,000 |  |  |  | 13,684,800 |  |  | $ | 573,393,120 |  |  |  | 12,963,577 |  |  | $ | 693,551,370 |  |  |  | 83,205,175 |  |  | $ | 3,465,464,820 |
The major rights of our Preferred Shares, prior to their conversion, were as follows: Voting Rights Each holder of our Preferred Shares was entitled to the number of votes as the number of Class A ordinary shares into which each holder’s preferred shares were convertible. Preferred shareholders and ordinary shareholders vote on all matters as a single class. Dividend Rights In the event our board declared a dividend, our Preferred Shares were entitled to receive a non-cumulative dividend of 8% per annum based on their respective original issue price prior to any ordinary share receiving a dividend. If the declared dividend was sufficient to cover the 8% minimum dividend, then the Preferred Shares would have participated in the remaining dividend amount on an as-converted basis with the ordinary shares. No dividends had been declared or paid on our ordinary shares prior to the conversion of our Preferred Shares in connection with the business combination transaction. Conversion Rights Our Preferred Shares had an optional conversion feature and an automatic conversion feature. Upon a conversion, the Preferred Shares were convertible into Class A ordinary shares. The conversion ratio for our Preferred Shares was 1 for 3.3593 and may change due to standard antidilutive adjustments. Preferred shareholders had the right to convert their preferred share holdings at any time in whole or in part. Our Preferred Shares were to automatically convert in the event of a public offering or an alternative listing, including through merger with an existing listed company or a special-purpose acquisition company. Our Series C preferred shares were to automatically convert in the event holders of more than 50% of such shares elected to convert their shares. Our Series D preferred shares were to automatically convert in the event holders of more than 66% of such shares elected to convert their shares. Redemption Rights In the event an automatic conversion or liquidation event had not occurred, our Preferred Shares become redeemable at the option of the holder on the earlier of June 10, 2026, or the date in which the principal business cannot be continued due to certain adverse circumstances (e.g., material integrity problems or fraud of our cofounders, loss of our business qualification, licenses, permits, etc.). The redemption amount payable to the holders would be determined as the higher of a 10% per annum return from the preferred shares original issuance date through the date of redemption or the fair market value on the redemption date. No event had occurred which would allow holders of our Preferred Shares to exercise their redemption option. The following presents the aggregate and per share redemption value of each preferred share series as of December 31, 2024:
As of December 31, 2024
Series |  | Total |  |  | Per Share |
A-1 |  | $ | 485,488,380 |  |  | $ | 31.98 |
A-2 |  |  | 456,377,760 |  |  | $ | 32.04 |
A-3 |  |  | 90,666,213 |  |  | $ | 32.05 |
B-1 |  |  | 423,255,328 |  |  | $ | 32.28 |
B-2 |  |  | 295,908,795 |  |  | $ | 32.55 |
B-3 |  |  | 68,775,000 |  |  | $ | 32.75 |
C-1 |  |  | 458,577,648 |  |  | $ | 33.51 |
D |  |  | 582,699,609 |  |  | $ | 44.95 |
|  | $ | 2,861,748,733 |  |  |  |  |
Liquidation Rights Our Preferred Shares were entitled to a liquidation preference in the event of a liquidation event. Liquidation events include the following items:
| ● | Any consolidation, reorganization, merger or any other arrangement whereby our shareholders prior to such transaction do not own at least 50% of the surviving entity.
| ● | A sale, lease, transfer or other disposition of all or substantially all of our assets.
| ● | Exclusive licensing of all or substantially all of our intellectual property rights to a third party.
| ● | Any liquidation, dissolution, or winding up of the Company, whether voluntary or involuntary.
No event occurred which would allow holders of our Preferred Shares to exercise their liquidation rights. The following presents the liquidation preferences of our preferred shares by series as of December 31, 2024:
As of December 31, 2024
Series |  | Outstanding Shares |  |  | Original Issue Price |  |  | Liquidation Multiplier |  |  | Liquidation Preference |
A-1 |  |  | 15,181,000 |  |  | $ | 0.45 |  |  |  | 1.2 |  |  | $ | 8,197,740 |
A-2 |  |  | 14,244,000 |  |  | $ | 0.91 |  |  |  | 1.0 |  |  |  | 12,962,040 |
A-3 |  |  | 2,828,899 |  |  | $ | 0.97 |  |  |  | 1.0 |  |  |  | 2,744,032 |
B-1 |  |  | 13,111,999 |  |  | $ | 2.29 |  |  |  | 1.0 |  |  |  | 30,026,478 |
B-2 |  |  | 9,090,900 |  |  | $ | 3.85 |  |  |  | 1.0 |  |  |  | 34,999,965 |
B-3 |  |  | 2,100,000 |  |  | $ | 5.00 |  |  |  | 1.0 |  |  |  | 10,500,000 |
C |  |  | 13,684,800 |  |  | $ | 8.41 |  |  |  | 1.0 |  |  |  | 115,089,168 |
D |  |  | 12,963,577 |  |  | $ | 33.14 |  |  |  | 1.0 |  |  |  | 429,612,942 |
Aggregate liquidation preference |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 644,132,365 |
In an event of liquidation, the order of liquidation distribution is first Series D followed by Series C, B-3, B-2, B-1, A-3, A-2 and then A-1. If in the event of a liquidation, our assets are insufficient to distribute and satisfy a particular Series’ liquidation preference in its entirety, then the assets available for distribution will be distributed ratably in proportion to the holders of that respective preferred series’ liquidation preference. Right of Participation Our holders of Preferred Shares (“Participation Right Holders”) had rights of participation (“Right of Participation”) with respect to the issuance of new equity securities. The Right of Participation does not apply to the following issuances of securities:
| ● | Ordinary shares issued or reserved under our Global Share Incentive Plan.
| ● | Ordinary shares issued in connection with a share split, consolidation or share dividend.
| ● | Ordinary shares issuable upon conversion of our Preferred Shares.
| ● | Equity securities issued in connection with a public offering.
| ● | Any equity securities issued in connection with the acquisition of another corporation or entity by consolidation, merger, purchase of assets, or other reorganization in which we acquire, in a single transaction or a series of related transactions, all or substantially all assets of other corporation or entity or 50% percent or more of the equity ownership or voting power of such other corporation or entity.

X
- Definition The entire disclosure for terms, amounts, nature of changes, rights and privileges, dividends, and other matters related to preferred stock. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 480 -SubTopic 10 -Name Accounting Standards Codification -Section S50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479857/480-10-S50-1 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 505 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/505/tableOfContent + Details
Name: | us-gaap_PreferredStockTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_TemporaryEquityAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration