As part of the Company's strategic shift to becoming a primarily healthcare company, as discussed in Note 1, on August 18, 2022, the Company completed the sale of 100% of the issued and outstanding membership interests in its wholly-owned subsidiary,Trans Ova, to Spring Bidco LLC, a Delaware limited liability company for $170,000 and up to $10,000 in cash earn-out payments contingent upon the performance of Trans Ova in each of 2022 and 2023, $5,000 for each year (the “Transaction”). The Company received $162,306 in proceeds, net of certain transaction costs, on August 18, 2022, after giving effect to the preliminary closing purchase price adjustments. The final working capital adjustment of $936 was received in the fourth quarter of 2022. In February 2023, Spring Bidco LLC notified the company that Trans Ova did not meet the financial measures required in 2022 in order to require the first $5,000 earn-out payment. The Company has until March 15, 2023 to respond to Spring Bidco LLC.

The Company elected to account for the contingent consideration arrangement as a gain contingency in accordance with ASC 450, Contingencies (Subtopic 450-30). Under this approach, the Company recognizes the contingent consideration receivable in earnings after the contingency is resolved. Accordingly, to determine the initial gain on the sale of Trans Ova, the Company did not include an amount related to the contingent consideration arrangement as part of the consideration received.

In connection with the Transaction, the Company, as of December 31, 2022, holds restricted cash of $43,339, in a segregated account to be used for certain permitted purposes, including resolution of the Company’s outstanding convertible notes as discussed further in Note 11. In addition, the Company is required to indemnify the Buyer for certain expenses incurred post close (related to covenants and certain additional specified liabilities including certain patent infringement lawsuits), if incurred, in amounts not to exceed $5,750, which was recorded as a reduction of the gain on divestiture in the twelve months ended December 31, 2022, and is included in other accrued liabilities as of December 31, 2022. To date, the Company has not received an indemnification claim.


	December 31,
	2021

Assets
Cash and cash equivalents	$	6,497
Trade Receivables, net	19,491
Inventory	12,935
Other current assets	1,265
Property, plan and equipment, net	25,716
Intangible assets, net	1,824
Goodwill	16,594
Right-of-use assets	910
Other noncurrent assets	252
Total assets held for sale	$	85,484
Liabilities
Accounts payable	$	2,293
Accrued compensation and benefits	3,367
Other accrued liabilities	3,778
Deferred revenue	2,952

Current portion of long-term debt	350
Other current liabilities	111
Long-term debt, net of current portion	2,867

Other long-term liabilities	805
Total liabilities held for sale or abandonment	$	16,523


	Year Ended December 31,
	2022		2021		2020
Product revenues	$	21,494	$	25,131	$	21,914
Service revenues	49,657		64,475		49,272
Total revenues	71,151		89,606		71,186
Cost of products	18,634		23,070		26,529
Cost of services	22,701		29,570		23,610
Research and development	2,348		2,208		2,216
Selling, general and administrative	15,215		22,128		19,010
Impairment of assets	—		—		106
Total operating expenses	58,898		76,976		71,471
Operating income (loss)	12,253		12,630		(285)
Other income, net	1,139		1,412		1,489
Equity in net loss of affiliates	—		—		(535)
Gain on divestiture	94,702		—		—
Income before income taxes	$	108,094	$	14,042	$	669
Income tax (expense) benefit	—		—		—
Income from discontinued operations	$	108,094	$	14,042	$	669

The following table presents the significant noncash items, purchases of property, plant and equipment, and proceeds from sales of assets for the discontinued operations related to Trans Ova that are included in the accompanying consolidated statements of cash flows:


	Year Ended December 31,
	2022	2021	2020
Adjustments to reconcile net loss to net cash used in operating activities
Depreciation and amortization	3,574	5,622	6,750

Impairment of assets	—	—	106
Loss on disposal of assets	421	561	4,325
Equity in net loss of affiliates	—	—	535


Provision for credit losses	944	1,128	899
Stock-based compensation expense	9	350	738


Cash flows from investing activities
Proceeds from repayment of notes receivable	—	3,689	—
Purchases of property, plant and equipment	(3,529)	(4,694)	(6,365)
Proceeds from sales of assets	594	1,894	2,387

As a result of market uncertainty driven by the COVID-19 pandemic and the state of the energy sector raising significant challenges for the strategic alternatives pursued by MBP Titan, beginning in the second quarter of 2020 and throughout the remainder of 2020, the Company suspended MBP Titan's operations, preserved certain of MBP Titan's intellectual property, terminated all of its personnel, and undertook steps to dispose of its other assets and obligations. The wind down of MBP Titan's activities was substantially completed by December 31, 2020, with the final disposition of certain property and equipment and the facility operating lease occurring in January 2021. This discontinuation of operations represented the continuation of a strategic shift to becoming primarily a healthcare company advancing technologies and products that address complex healthcare challenges that the Company commenced as part of the Transactions defined and discussed below. The assets, liabilities, and expenses related to the discontinued operations of MBP Titan are classified and presented as discontinued operations in the accompanying consolidated financial statements for all periods.

The January 2021 sale of property and equipment resulted in a gain on disposal of assets of $464, which is included in income from discontinued operations in the accompanying consolidated statement of operations for the year ended December 31, 2021. In January 2021, the Company executed termination and recapture agreements with the landlord of the leased facility used in MBP Titan's operations, thereby relieving the Company of all of its obligations related to the facility that were originally due to expire in July 2025. This lease termination resulted in a gain of $4,602, which is also included in income from discontinued operations in the accompanying consolidated statement of operations for the year ended December 31, 2021.

After the wind down of MBP Titan, certain assets and contractual obligations which were previously managed by MBP Titan continue to be managed at the Precigen corporate level. These remaining assets and contractual obligations include the Company's equity interest in and collaboration agreements with Intrexon Energy Partners, LLC ("Intrexon Energy Partners") and Intrexon Energy Partners II, LLC ("Intrexon Energy Partners II"), including the associated deferred revenue remaining under each collaboration agreement (Notes 4 and 5), as well as the associated intellectual property developed by MBP Titan to date. These assets, liabilities, and related historical revenue and equity losses are included in the Company's operating results from continuing operations in the accompanying consolidated financial statements for all periods presented as a result of the Company's continuing involvement.

The following table presents the significant noncash items, purchases of property, plant and equipment, and proceeds from sales of assets for the discontinued operations related to MBP Titan that are included in the accompanying consolidated statements of cash flows.


	Year Ended December 31,
	2021		2020
Adjustments to reconcile net loss to net cash used in operating activities
Depreciation and amortization	$	—	2,474
Impairment of goodwill	—		9,635
Impairment of other noncurrent assets	—		12,406
(Gain) loss on disposal of assets, net	(464)		67




Stock-based compensation expense	—		(34)

Noncash gain on termination of leases	(4,602)		—
Cash flows from investing activities

Purchases of property, plant and equipment	—		(88)
Proceeds from sales of assets	1,083		3,952

On January 1, 2020, the Company and TS Biotechnology Holdings, LLC ("TS Biotechnology"), a related party and an entity managed by Third Security, entered into a Stock and Asset Purchase Agreement pursuant to which the Company agreed to sell a majority of the Company's non-healthcare assets and operations to TS Biotechnology for $53,000 and certain contingent payment rights (the "TS Biotechnology Sale"). The TS Biotechnology Sale closed on January 31, 2020. The assets and operations sold in the TS Biotechnology Sale included the following wholly owned subsidiaries, as well as certain equity securities that were directly related to the subsidiaries sold:

Additionally, on January 2, 2020, the Company sold its equity interest in EnviroFlight, LLC ("EnviroFlight"), a JV with Darling Ingredients, Inc. ("Darling"), and related intellectual property rights to Darling for $12,200 (the "EnviroFlight Sale"). Unless referenced separately, the TS Biotechnology Sale and the EnviroFlight Sale are collectively referred to as the "Transactions".

Upon the closing of the TS Biotechnology Sale in January 2020, the cumulative foreign currency translation losses totaling $26,957 were released to earnings and included in loss from discontinued operations. See further discussion below regarding this out-of-period adjustment.


	Year Ended December 31, 2020
	TS Biotechnology Sale		EnviroFlight Sale		Total
Revenues (1)	$	1,294	$	—	$	1,294
Operating expenses	896		—		896
Operating income	398		—		398
Gain on sale of discontinued operations	633		39		672
Loss on release of cumulative foreign currency translation adjustment	(26,957)		—		(26,957)
Other expense, net	(129)		—		(129)
Equity in net loss of affiliates	—		(38)		(38)
Income (loss) before income taxes	(26,055)		1		(26,054)
Income tax expense	(2)		—		(2)
Income (loss) from discontinued operations	$	(26,057)	$	1	$	(26,056)

The following table presents the significant noncash items, investments in EnviroFlight and purchases of property, plant and equipment for the discontinued operations for the Transactions that are included in the accompanying consolidated statements of cash flows.


	Year Ended December 31,
	2020
Adjustments to reconcile net loss to net cash used in operating activities
Depreciation and amortization	$	—
Impairment of goodwill	—
Impairment of other noncurrent assets	—
Gain on sale of discontinued operations	(672)
Loss on release of cumulative foreign currency translation adjustment	26,957
Unrealized and realized depreciation on equity securities and preferred stock, net	106
Equity in net loss of EnviroFlight	38
Stock-based compensation expense	(1,346)
Deferred income taxes	—
Cash flows from investing activities
Investments in EnviroFlight	—
Purchases of property, plant and equipment	(382)

During the year ended December 31, 2020, the Company recorded an out-of-period adjustment of $26,572 to loss from discontinued operations which relates to the effect of cumulative foreign translation losses associated with the entities sold in the TS Biotechnology Sale. This charge, which is entirely noncash, should have been recorded in the year ended December 31, 2019 as an additional impairment charge included in loss from discontinued operations. There was no impact to net loss from continuing operations, cash and short-term investments, cash flows, or Segment Adjusted EBITDA. The error also had no impact on the cash consideration received upon closing of the TS Biotechnology Sale nor the representations and warranties made by the Company in the transaction. The Company evaluated the effects of this out-of-period adjustment, both qualitatively and quantitatively, and concluded that this adjustment was not material to the Company's results of operations for the year ended December 31, 2020.