Press Release

ReShape Lifesciences Enters into Warrant Exercise Transaction for $46.2 Million in Gross Proceeds

June 29, 2021 at 5:00 PM EDT

SAN CLEMENTE, CA / ACCESSWIRE / June 29, 2021 / ReShape Lifesciences Inc. (NASDAQ:RSLS), a global weight-loss solutions leader, announced today that it has entered into a warrant exercise agreement with existing accredited investors to exercise certain outstanding warrants to purchase up to an aggregate of 7.9 million shares of the company's common stock. In consideration for the immediate exercise of the existing warrants for cash, the exercising holders received new unregistered warrants to purchase up to an aggregate of 5.9 million shares (equal to 75% of the shares of common stock issued in connection with the exercise) of the company's common stock. The investors paid a cash purchase price for the new warrants equal to $0.09375 per share of common stock underlying the new warrants. In connection with the exercise, the company also agreed to reduce the exercise price of certain of the existing warrants to $6.00, which is equal to the most recent closing price of the company's common stock on The Nasdaq Capital Market prior to the execution of the warrant exercise agreement.

The new warrants are exercisable immediately upon issuance at an exercise price of $6.00 per share and have a term of exercise equal to five years. The company agreed to file a resale registration statement on Form S-3 within 30 days with respect to the new warrants and the shares of common stock issuable upon exercise of the new warrants. The warrant exercise agreement and the new warrants each include a beneficial ownership limitation that prevents any of the investors from owning more than 9.99% of the company's outstanding common stock at any time.

The gross proceeds to the company from the exercise of the existing warrants was approximately $46.2 million, prior to deducting placement agent fees and estimated offering expenses. Bart Bandy, President and Chief Executive Officer of ReShape Lifesciences, stated that the company will use approximately $10.5 million of the net proceeds to repay in full the outstanding principal and accrued interest under its secured credit agreement dated March 25, 2020, as amended. Following the company's recent listing on The Nasdaq Capital Market, the company intends to use the remainder of the net proceeds for commercial growth, working capital and general corporate purposes.

Maxim Group LLC ("Maxim") acted as the exclusive placement agent for the transaction.

About ReShape Lifesciences Inc.

ReShape Lifesciences is America's premier weight-loss solutions company, offering an integrated portfolio of proven products and services that manage and treat obesity and metabolic disease. The FDA-approved Lap-Band® program provides minimally invasive, long-term treatment of obesity and is an alternative to more invasive surgical stapling procedures such as the gastric bypass or sleeve gastrectomy. The ReShape Vest™ System is an investigational (outside the U.S.) minimally invasive, laparoscopically implanted medical device that wraps around the stomach, emulating the gastric volume reduction effect of conventional weight-loss surgery. It helps enable rapid weight loss in obese and morbidly obese patients without permanently changing patient anatomy. The recently launched reshapecare™ virtual health coaching program is a virtual telehealth weight management program that supports lifestyle changes for all weight-loss patients, to help them keep the weight off over time.

Company Contact:

Thomas Stankovich
Chief Financial Officer
ReShape Lifesciences Inc.
949-276-6042
tstankovich@ReShapeLifesci.com

Investor Contacts:

James Salierno/Daniel Kontoh-Boateng
Vice President
The Ruth Group
646-536-7028/7019
jsalierno@theruthgroup.com
dboateng@theruthgroup.com

SOURCE: ReShape Lifesciences Inc.

For investor inquiries, please contact:

ReShape Lifesciences Investor Contact:
Thomas Stankovich
Chief Financial Officer
949-276-6042
ir@ReShapeLifesci.com

Investor Contacts:
Daniel Kontoh-Boateng
Vice President
The Ruth Group
646-536-7028/7019
dboateng@theruthgroup.com

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