0001558370-22-013821 | 10-Q | XBRL Viewer

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Document and Entity Information - shares	6 Months Ended
Document and Entity Information - shares	Jun. 30, 2022	Aug. 15, 2022
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Jun. 30, 2022
Entity File Number	1-37897
Entity Registrant Name	RESHAPE LIFESCIENCES INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	26-1828101
Entity Address, Address Line One	1001 Calle Amanecer
Entity Address, City or Town	San Clemente
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	92673
City Area Code	(949)
Local Phone Number	429-6680
Title of 12(b) Security	Common stock, $0.001 par value per share
Trading Symbol	RSLS
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		22,559,404
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q2
Entity Central Index Key	0001427570
Amendment Flag	false

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Current assets:
Cash and cash equivalents	$ 11,494	$ 22,765
Restricted cash	50	50
Accounts and other receivables (net of allowance for doubtful accounts of $934 and $1,172 respectively)	2,448	2,815
Inventory	4,226	3,003
Prepaid expenses and other current assets	1,269	1,622
Total current assets	19,487	30,255
Property and equipment, net	887	1,454
Operating lease right-of-use assets	338	266
Other intangible assets, net	19,915	20,827
Other assets	1,298	1,456
Total assets	41,925	54,258
Current liabilities:
Accounts payable	2,513	3,468
Accrued and other liabilities	5,814	3,169
Warranty liability, current	525	415
Operating lease liabilities, current	338	279
Total current liabilities	9,190	7,331
Warranty liability, noncurrent	5	300
Deferred income taxes, net	367	555
Total liabilities	9,562	8,186
Commitments and contingencies (Note 13)
Stockholders' equity:
Common stock, $0.001 par value; 100,000,000 shares authorized at both June 30, 2022 and December 31, 2021; 19,629,708 and 17,831,875 shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively	20	18
Additional paid-in capital	626,966	622,906
Accumulated deficit	(594,551)	(576,760)
Accumulated other comprehensive loss	(72)	(92)
Total stockholders' equity	32,363	46,072
Total liabilities and stockholders' equity	41,925	54,258
Series C convertible preferred stock
Stockholders' equity:
Preferred stock, Value

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Allowance for doubtful accounts	$ 934	$ 1,172
Preferred stock, authorized	10,000,000	10,000,000
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	19,629,708	17,831,875
Common stock, shares outstanding	19,629,708	17,831,875
Series C convertible preferred stock
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, issued	95,388	95,388
Preferred stock outstanding	95,388	95,388

Condensed Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Condensed Consolidated Statements of Operations
Revenue	$ 2,892	$ 3,529	$ 5,332	$ 6,750
Cost of revenue	1,009	1,376	2,231	2,314
Gross profit	1,883	2,153	3,101	4,436
Operating expenses:
Sales and marketing	4,663	1,441	9,371	2,691
General and administrative	5,454	4,311	9,616	7,031
Research and development	761	103	1,508	674
Loss on disposal of assets, net	381		381
Total operating expenses	11,259	5,855	20,876	10,396
Operating loss	(9,376)	(3,702)	(17,775)	(5,960)
Other expense (income), net:
Interest (income) expense, net	(14)	172	(15)	771
Loss on extinguishment of debt, net		101		2,061
Loss (Gain) on foreign currency exchange, net	204	(101)	188	(69)
Other	1		(9)
Loss before income tax provision	(9,567)	(3,874)	(17,939)	(8,723)
Income tax (benefit) expense	9	28	(148)	53
Net loss	$ (9,576)	$ (3,902)	$ (17,791)	$ (8,776)
Net loss per share - basic and diluted:
Net loss per share - basic (as revised for the three and six months ended June 30, 2021, see Note 1)	$ (0.50)	$ (0.86)	$ (0.94)	$ (2.07)
Net loss per share - diluted (as revised for the three and six months ended June 30, 2021, see Note 1)	$ (0.50)	$ (0.86)	$ (0.94)	$ (2.07)
Shares used to compute basic net loss per share (as revised for the three and six months ended June 30, 2021, see Note 1)	19,310,968	4,553,976	18,933,217	4,246,060
Shares used to compute diluted net loss per share (as revised for the three and six months ended June 30, 2021, see Note 1)	19,310,968	4,553,976	18,933,217	4,246,060

Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Condensed Consolidated Statements of Comprehensive Loss
Net loss	$ (9,576)	$ (3,902)	$ (17,791)	$ (8,776)
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments	(1)	(7)	20	12
Other comprehensive (loss) income, net of tax	(1)	(7)	20	12
Comprehensive loss	$ (9,577)	$ (3,909)	$ (17,771)	$ (8,764)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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+ Details

Condensed Consolidated Statements of Stockholders' Equity - USD ($)	Preferred Stock Series B convertible preferred stock	Preferred Stock Series C convertible preferred stock	Common Stock	Additional Paid-in Capital	Accumulated Deficit	Accumulated Other Comprehensive Income (Loss)	Total
Balance at Dec. 31, 2020		$ 1,000	$ 3,000	$ 529,432,000	$ (514,827,000)	$ (121,000)	$ 14,488,000
Balance (in shares) at Dec. 31, 2020	3	95,388	3,486,253
Changes in Stockholders' (Deficit) Equity
Net loss					(8,776,000)		(8,776,000)
Other comprehensive income (loss), net of tax						12,000	12,000
Issuance of common stock pursuant to reverse acquisition	$ (3)	$ (1,000)	$ 4,000	30,558,000			30,561,000
Issuance of common stock pursuant to reverse acquisition (in shares)			3,340,035
Reversal of stock compensation				(263,000)			(263,000)
Issuance of warrants				2,974,000			2,974,000
Deferred issuance cost for shares held in abeyance				17,705,000			$ 17,705,000
Issuance of stock from RSUs (shares)							909,191
Institutional exercise of warrants			$ 1,000	1,202,000			$ 1,203,000
Institutional exercise of warrants (in shares)			1,250,470
Stock options exercised				215,000			215,000
Stock options exercised (in shares)			91,864
Balance at Jun. 30, 2021			$ 8,000	581,823,000	(523,603,000)	(109,000)	58,119,000
Balance (in shares) at Jun. 30, 2021		95,388	8,168,622
Balance at Mar. 31, 2021		$ 1,000	$ 3,000	532,507,000	(519,701,000)	(102,000)	12,708,000
Balance (in shares) at Mar. 31, 2021	3	95,388	3,486,253
Changes in Stockholders' (Deficit) Equity
Net loss					(3,902,000)		(3,902,000)
Other comprehensive income (loss), net of tax						(7,000)	(7,000)
Issuance of common stock pursuant to reverse acquisition		$ (1,000)	$ 4,000	30,558,000			30,561,000
Issuance of common stock pursuant to reverse acquisition (in shares)	(3)		3,340,035
Reversal of stock compensation				(364,000)			(364,000)
Deferred issuance cost for shares held in abeyance				17,705,000			$ 17,705,000
Issuance of stock from RSUs (shares)							0
Institutional exercise of warrants (in shares)			1,250,470
Exercise of warrants			$ 1,000	1,202,000			$ 1,203,000
Stock options exercised				215,000			215,000
Stock options exercised (in shares)			91,864
Balance at Jun. 30, 2021			$ 8,000	581,823,000	(523,603,000)	(109,000)	58,119,000
Balance (in shares) at Jun. 30, 2021		95,388	8,168,622
Balance at Dec. 31, 2021			$ 18,000	622,906,000	(576,760,000)	(92,000)	46,072,000
Balance (in shares) at Dec. 31, 2021		95,388	17,831,875
Changes in Stockholders' (Deficit) Equity
Net loss					(17,791,000)		(17,791,000)
Other comprehensive income (loss), net of tax						20,000	20,000
Reversal of stock compensation				1,570,000			$ 1,570,000
Issuance of stock from RSUs			$ 1,000	(1,000)
Issuance of stock from RSUs (shares)			909,191				143,544
Exercise of warrants			$ 1,000	2,491,000			$ 2,492,000
Exercise of warrants (in shares)			888,642
Balance at Jun. 30, 2022			$ 20,000	626,966,000	(594,551,000)	(72,000)	32,363,000
Balance (in shares) at Jun. 30, 2022		95,388	19,629,708
Balance at Mar. 31, 2022			$ 19,000	623,652,000	(584,975,000)	(71,000)	38,625,000
Balance (in shares) at Mar. 31, 2022		95,388	18,597,522
Changes in Stockholders' (Deficit) Equity
Net loss					(9,576,000)		(9,576,000)
Other comprehensive income (loss), net of tax						(1,000)	(1,000)
Reversal of stock compensation				823,000			$ 823,000
Issuance of stock from RSUs (shares)			143,544				143,544
Exercise of warrants			$ 1,000	2,491,000			$ 2,492,000
Exercise of warrants (in shares)			888,642
Balance at Jun. 30, 2022			$ 20,000	$ 626,966,000	$ (594,551,000)	$ (72,000)	$ 32,363,000
Balance (in shares) at Jun. 30, 2022		95,388	19,629,708

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021
Cash flows from operating activities:
Net loss	$ (17,791)	$ (8,776)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense	184	40
Amortization of intangible assets	911	828
Noncash interest expense		78
Loss on extinguishment of debt, net		2,061
Loss on disposal of assets, net	381
Stock-based compensation	1,570	(263)
Bad debt expense	(104)	56
Provision for inventory excess and obsolescence	129	13
Deferred income tax	(188)
Amortization of debt discount and deferred debt issuance costs		494
Other noncash items	(18)	15
Change in operating assets and liabilities, net of business combination:
Accounts and other receivables	471	(859)
Inventory	(1,352)	481
Prepaid expenses and other current assets	353	(267)
Accounts payable and accrued liabilities	1,681	1,853
Warranty liability	(185)	(219)
Other	158	316
Net cash used in operating activities	(13,800)	(4,149)
Cash flows from investing activities:
Capital expenditures	(19)	(196)
Proceeds from acquisition		5,207
Proceeds from sale of capital assets	39
Cash provided by investing activities::	20	5,011
Cash flows from financing activities:
Proceeds from warrants exercised	2,489	45,616
Proceeds from stock options exercised		216
Proceeds from credit agreement		1,000
Payment of credit agreement		(10,500)
Net cash provided by financing activities	2,489	36,332
Effect of currency exchange rate changes on cash and cash equivalents	20	12
Net (decrease) increase in cash, cash equivalents and restricted cash	(11,271)	37,206
Cash, cash equivalents and restricted cash at beginning of period	22,815	3,007
Cash, cash equivalents and restricted cash at end of period	11,544	40,213
Supplemental disclosure:
Cash paid for income taxes		31
Cash paid for interest		296
Noncash investing and financing activities:
Capital expenditures accruals	$ 14	51
Purchase price, net of cash received		25,355
Deferred issuance cost related to abeyance of shares		17,705
Fair value of warrants included as a component of loss on extinguishment of debt		$ 2,974

Basis of Presentation

6 Months Ended

Jun. 30, 2022

Basis of Presentation

Basis of Presentation

(1) Basis of Presentation

The accompanying interim condensed consolidated financial statements and related disclosures of Reshape Lifesciences Inc. (the “Company” or “ReShape”) have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC") and should be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, filed on April 8, 2022. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America ("GAAP") have been condensed or omitted.

In the opinion of management, the interim consolidated condensed financial statements reflect all adjustments considered necessary for a fair statement of the interim periods. All such adjustments are of a normal, recurring nature. The results of operations for the interim periods are not necessarily indicative of the results of operations to be expected for the full year.

Revision of Previously Issued Financial Statement for Correction of Immaterial Errors

The Company revised the statement of operations for the periods ended December 31, 2020, March 31, 2021, June 30, 2021, September 30, 2021, December 31, 2021, and March 31, 2022, to reflect the correction of an immaterial error in the computation of the weighted average shares used to compute basic and diluted net loss per share. This revision has no impact on the Company’s net loss or accumulated deficit.

The following table summarizes the effect of the revision on each financial statement line item for the periods ended as indicated:


	Condensed Consolidated Statement of Operations
	As Previously
	Reported		Adjustment		As Revised
For the year ended December 31, 2020
Net loss per share - basic and diluted:
Net loss per share - basic and diluted	$	(5.54)	$	(0.01)	$	(5.55)
Shares used to compute basic and diluted net loss per share		3,904,762		(6,612)		3,898,150
Three months ended March 31, 2021
Net loss per share - basic and diluted:
Net loss per share - basic and diluted	$	(1.24)	$	—	$	(1.24)
Shares used to compute basic and diluted net loss per share		3,927,986		10,159		3,938,145
Three months ended June 30, 2021
Net loss per share - basic and diluted:
Net loss per share - basic and diluted	$	(0.47)	$	(0.39)	$	(0.86)
Shares used to compute basic and diluted net loss per share		8,226,144		(3,672,168)		4,553,976
Six months ended June 30, 2021
Net loss per share - basic and diluted:
Net loss per share - basic and diluted	$	(1.11)	$	(0.96)	$	(2.07)
Shares used to compute basic and diluted net loss per share		7,928,702		(3,682,642)		4,246,060
Three months ended September 30, 2021
Net loss per share - basic and diluted:
Net loss per share - basic and diluted	$	(1.48)	$	0.44	$	(1.04)
Shares used to compute basic and diluted net loss per share		11,997,370		5,090,884		17,088,254
Nine months ended September 30, 2021
Net loss per share - basic and diluted:
Net loss per share - basic and diluted	$	(2.51)	$	(0.56)	$	(3.07)
Shares used to compute basic and diluted net loss per share		10,546,683		(1,932,362)		8,614,321
For the year ended December 31, 2021
Net loss per share - basic and diluted:
Net loss per share - basic and diluted	$	(5.00)	$	(0.67)	$	(5.67)
Shares used to compute basic and diluted net loss per share		12,378,502		(1,452,519)		10,925,983
Three months ended March 31, 2022
Net loss per share - basic and diluted:
Net loss per share - basic and diluted	$	(0.44)	$	0.00	$	(0.44)
Shares used to compute basic and diluted net loss per share		18,539,568		11,700		18,551,268

Reverse Stock Split and Merger Exchange Ratio

On June 15, 2021, and immediately prior to the closing of the merger of Obalon Therapeutics, Inc. and ReShape Lifesciences Inc., the Company effected a 1-for-3 reverse stock split. Accordingly, all share and per share amounts for the period presented in the accompanying consolidated financial statements and notes thereto have been adjusted retroactively, where applicable, to reflect the reverse stock split. No fractional shares were issued in connection with the reverse stock split. Unless otherwise noted, all references to shares of the Company’s common stock and per share amounts have also been adjusted to reflect the exchange ratio of 0.5367 Obalon shares for one ReShape share in connection with the merger.

Summary of Significant Accounting Policies

The Company’s significant accounting policies are described in Note 2 to its audited consolidated financial statements for the year ended December 31, 2021, which are included in the Company’s Annual Report on Form 10-K which was filed with the SEC on April 8, 2022.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and judgments that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results may materially differ from these estimates. The Company reviews its estimates on an ongoing basis or as new information becomes available to ensure that these estimates appropriately reflect changes in its business.

Acquisition

The Company accounts for business combinations in accordance with Accounting Standards Codification (“ASC”) 805, Business Combinations. The results of businesses acquired in a business combination are included in the Company’s consolidated financial statements from the date of the acquisition. Purchase accounting results in assets and liabilities of an acquired business generally being recorded at their estimated fair values on the acquisition date. Any excess consideration over the fair value of assets acquired and liabilities assumed is recognized as goodwill. Transaction costs associated with business combinations are expensed as incurred and are included in general and administrative related costs in the consolidated statements of operations. The Company performs valuations of assets acquired and liabilities assumed and allocates the purchase price to its respective assets and liabilities. Determining the fair value of assets acquired and liabilities assumed requires management to use significant judgment and estimates.

Upon completion of the business combination with Obalon on June 15, 2021, the transaction was treated as a “reverse acquisition” for financial accounting purposes. As a result of the controlling interest of the former shareholders of ReShape, for financial statement reporting and accounting purposes, ReShape was considered the acquirer under the acquisition method of accounting in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 805-10-55. The reverse acquisition is deemed a capital transaction in substance whereas the historical assets and liabilities of Obalon before the business combination were replaced with the historical financial statements of ReShape in all future filings with the SEC.

Goodwill and Long-Lived Assets

Goodwill represents the excess of the cost of an acquired business over the fair value of the identifiable tangible and intangible assets acquired and liabilities assumed in a business combination.

Indefinite-lived intangible assets relate to in-process research and development ("IPR&D") acquired in business combinations. The estimated fair values of IPR&D projects acquired in a business combination which have not reached technological feasibility are capitalized and accounted for as indefinite-lived intangible assets until completion or abandonment of the projects. In accordance with guidance within FASB ASC 350 “Intangibles - Goodwill and Other,” goodwill and identifiable intangible assets with indefinite lives are not subject to amortization but must be evaluated for impairment.

We evaluate long-lived assets, including finite-lived intangible assets, for impairment by comparison of the carrying amounts to future net undiscounted cash flows expected to be generated by such assets when events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. Should an impairment exist, the impairment loss would be measured based on the excess carrying value of the asset over the asset’s fair value or estimates of future discounted cash flows.

For goodwill and indefinite-lived intangible assets, in-process research and development, we review for impairment annually and upon the occurrence of certain events as required by ASC Topic 350, “Intangibles — Goodwill and Other.” Goodwill and indefinite-lived intangible assets are tested at least annually for impairment and more frequently if events or changes in circumstances indicate that the asset might be impaired. We review goodwill for impairment by first assessing qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the two-step goodwill impairment test. If we are able to determine that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, we would conclude that goodwill is not impaired. If the carrying amount of a reporting unit is zero or negative, the second step of the impairment test is performed to measure the amount of

impairment loss, if any, when it is more likely than not that a goodwill impairment exists. The Company did not record any impairment loss for goodwill or indefinite-lived intangible assets for the three months and six months ended June 30, 2022 and 2021.

Fair Value of Financial Instruments

The carrying amounts of cash equivalents, accounts receivable, accounts payable and certain accrued and other liabilities approximate fair value due to their short-term maturities. Refer to Note 5 regarding the fair value of debt instruments and Note 9 regarding fair value measurements and inputs of warrants.

Net Loss Per Share

The following table sets forth the potential shares of common stock that are not included in the calculation of diluted net loss per share because to do so would be anti-dilutive as of the end of each period presented:


	June 30,
	2022	2021
Stock options	820,092	256,881
Convertible preferred stock	38	742
Warrants	6,952,328	6,181,997

Recent Accounting Pronouncements

There were no new accounting standards adopted by the Company during the six months ended June 30, 2022.

New accounting standards not yet adopted are discussed below.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which is intended to provide financial statement users with more useful information about expected credit losses on financial assets held by a reporting entity at each reporting date. In May 2019, the FASB issued ASU No. 2019-05, which amended the new standard by providing targeted transition relief. The new guidance replaces the existing incurred loss impairment methodology with a methodology that requires consideration of a broader range of reasonable and supportable forward-looking information to estimate all expected credit losses. In November 2019, the FASB issued ASU No. 2019-11, which amended the new standard by providing additional clarification. This guidance is effective for the fiscal years and interim periods within those years beginning after December 15, 2022. The Company is currently evaluating the impact the guidance will have on its consolidated financial statements.

Liquidity and Management's Plans

6 Months Ended

Jun. 30, 2022

Liquidity and Management's Plans

Liquidity and Management's Plans

(2) Liquidity and Management’s Plans

The Company currently does not generate revenue sufficient to offset operating costs and anticipates such shortfalls to continue primarily due to the unpredictability of new variants of COVID-19, which may result in a slow-down of elective surgeries and restrictions in some locations. As of June 30, 2022, the Company had net working capital of approximately $10.3 million, primarily due to cash and cash equivalents and restricted cash of $11.5 million. The Company’s principal source of liquidity as of June 30, 2022, consisted of approximately $11.5 million of cash and cash equivalents and restricted cash, and $2.4 million of accounts receivable. Based on its available cash resources, the Company may not have sufficient cash on hand to fund its current operations for more than twelve months from the date of filing this Quarterly Report on Form 10-Q. This condition raises substantial doubt about the Company’s ability to continue as a going concern. The Company believes in the viability of its business strategy and in its ability to raise additional funds, however, there can be no assurance to that effect.

Given the Company’s projected operating requirements and its existing cash and cash equivalents management’s plans include evaluating different strategies to obtain the required funding of future operations. Our anticipated operations include plans to (i) integrate the sales and operations of the Company with the Lap-Band product line in order to expand sales domestically and internationally (ii) improve operational efficiencies, resulting in a reduction of

operational expenses, as well as a reduction to marketing and advertising costs, primarily due to focusing on digital media rather than television and print and (iii) to continue promoting reshapecare as an addition to bariatric surgery or as an alternative to individuals that do not meet the criteria and/or do not want to go through bariatric surgery. If sales do not improve, we will reduce our expenditures for marketing, clinical and product development activities to maintain operational activities until a period of time in which we could obtain additional debt or equity financing to support our operations. However, there can be no assurance that the Company will be able to secure such additional financing. Therefore, the plans cannot be deemed probable of being implemented. As a result, the Company’s plans do not alleviate substantial doubt about our ability to continue as a going concern.

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of the uncertainties described above.

COVID-19 Risk and Uncertainties and CARES Act

Since the first quarter of 2020, the COVID-19 pandemic has led to unprecedented restrictions on, distributions in, and other related impacts on business and personal activities, including a shift in healthcare priorities, which resulted in a significant decline in medical procedures in 2020 in the United States and foreign countries. Concerns remain regarding the pace of economic recovery due to virus resurgence, including new variants, across the globe as well as vaccine distribution and hesitancy. The United States and other foreign governments may reimplement restrictions and other requirements in light of the continuing spread of the COVID-19 pandemic. Due to the uncertainty caused by the COVID-19 pandemic, the full extent to which the pandemic will directly or indirectly impact the Company’s business, results of operations and financial condition, including sales, expenses, manufacturing, clinical trials, research and development costs, reserves and allowances, will depend on future developments that are highly uncertain and difficult to predict. These developments include, but are not limited to, the duration and spread of the outbreak (including new and more contagious variants of COVID-19), its severity, the actions to contain the virus or address its impact, the public acceptance and efficacy of vaccines and other treatments, United States and foreign governments actions to respond to the reduction of global activity, and how quickly and to what extent normal economic and operating conditions can resume.

On March 27, 2020, President Trump signed into law the “Coronavirus Aid, Relief, and Economic Security (CARES) Act.” The CARES Act, among other things, included provisions relating to refundable payroll tax credits, deferment of employer side social security payments, net operating loss carryback periods, alternative minimum tax credit refunds, modifications to the net interest deduction limitations, increased limitations on qualified charitable contributions, and technical corrections to tax depreciation methods for qualified improvement property. The CARES Act established the Paycheck Protection Program (“PPP”) under which the Company received a PPP loan. On February 3, 2021, the Company submitted the application for PPP loan forgiveness according to the terms and conditions of the United States Small Business Administration’s (“SBA”) Loan Forgiveness Application (Revised June 24, 2002). On March 1, 2021, the Company received confirmation from the SBA that the PPP Loan had been forgiven in full including all interest incurred. This may still be subject to audit by the SBA or relevant authorities, subject to terms and conditions of the PPP program. The Company was also able to benefit from the employee retention credit. For further details on the PPP loan and the employee retention credit, see Note 5 below.

Supplemental Balance Sheet Information

6 Months Ended

Jun. 30, 2022

Supplemental Balance Sheet Information

Supplemental Balance Sheet Information

(3) Supplemental Balance Sheet Information

Components of selected captions in the condensed consolidated balance sheets consisted of the following:

Inventory:


	June 30,		December 31,
	2022		2021
Raw materials	$	1,050	$	829
Sub-assemblies		1,202		682
Finished goods		1,974		1,492
Total inventory	$	4,226	$	3,003

Prepaid expenses and other current assets:


	June 30,		December 31,
	2022		2021
Prepaid insurance	$	716	$	736
Prepaid advertising and marketing		356		698
Other current assets		197		188
Total prepaid expenses and other current assets	$	1,269	$	1,622

Accrued and other liabilities:


	June 30,		December 31,
	2022		2021
Payroll and benefits	$	2,362	$	1,527
Accrued legal settlements		2,000		—
Customer deposits		605		549
Taxes		190		307
Accrued insurance premium		151		301
Accrued professional		284		300
Other liabilities		222		185
Total accrued and other liabilities	$	5,814	$	3,169

Goodwill and Intangible Assets

6 Months Ended

Jun. 30, 2022

Goodwill and Intangible Assets

Goodwill and Intangible Assets

(4) Goodwill and Intangible Assets

Indefinite-lived intangible assets consist of IPR&D for the ReShape Vest recorded in connection with the Company’s 2017 acquisition of BarioSurg, Inc. and developed technology recorded in connection with the Obalon acquisition. The Company’s finite-lived intangible assets consists of developed technology, trademarks and tradenames, and covenant not to compete. The estimated useful lives of these finite-lived intangible assets range from 3 to 10 years. The amortization expenses for the three months ended June 30, 2022 and 2021, were $0.5 million and $0.4 million, respectively, and the six months ended June 30, 2022 and 2021 were $0.9 million and $0.8 million, respectively.


	June 30, 2022
	Weighted Average Useful Life (years)	Gross Carrying Amount		Accumulated Amortization		Net Book Value
Finite-lived intangible assets:
Developed technology	10.8	$	17,092	$	(5,276)	$	11,816
Trademarks/Tradenames	10.0		2,045		(893)		1,152
Covenant not to compete	3.0		76		(76)		—
			19,213		(6,245)		12,968
Indefinite-lived intangible assets:
In-process research and development	indefinite		6,947		—		6,947
Total		$	26,160	$	(6,245)	$	19,915


	December 31, 2021
	Weighted Average Useful Life (years)	Gross Carrying Amount		Accumulated Amortization		Net Book Value
Finite-lived intangible assets:
Developed technology	10.8	$	17,092	$	(4,467)	$	12,625
Trademarks/Tradenames	10.0		2,045		(790)		1,255
Covenant not to compete	3.0		76		(76)		—
			19,213		(5,333)		13,880
Indefinite-lived intangible assets:
In-process research and development	indefinite		6,947		—		6,947
Total		$	26,160	$	(5,333)	$	20,827

Debt

6 Months Ended

Jun. 30, 2022

Debt

Debt

(5) Debt

CARES Act

On April 24, 2020, the Company entered into a PPP Loan agreement with Silicon Valley Bank (“SVB”) under the PPP, which is part of the CARES Act administered by the United States Small Business Administration (“SBA”). As part of the application for these funds, the Company in good faith, certified that the current economic uncertainty made the loan request necessary to support the ongoing operations of the Company. This certification further required the Company to take into account our then-current business activity and our ability to access other sources of liquidity sufficient to support ongoing operations in a manner that is not significantly detrimental to the business. Under this program, the Company received proceeds of $1.0 million from the PPP Loan. In accordance with the requirements of the PPP, the Company used proceeds from the PPP Loan primarily for payroll costs, rent and utilities. The PPP Loan carried a 1.00% interest rate per annum, matured on April 24, 2022, and was subject to the terms and conditions applicable to loans administered by the SBA under the PPP.

On February 23, 2021, the Company submitted the application for PPP loan forgiveness, in accordance with the terms and conditions of the SBA’s Loan Forgiveness Application (revised June 24, 2020). On March 1, 2021, the

Company received confirmation from the SBA that the PPP Loan was forgiven in full including all interest incurred, which resulted in a gain on debt extinguishment of $1.0 million, during the three months ended March 31, 2021.

On December 27, 2020, the Taxpayer Certainty and Disaster Tax Relief Act of 2020 expanded certain benefits made available under the enhanced CARES Act, including modifying and extending the employee retention credit. As modified, the employee retention credit provides eligible employers with fewer than 500 employees a refundable tax credit against the employer’s share of social security taxes. The employee retention credit is equal to 70% of qualified wages paid to employees during calendar year 2021 for a maximum credit of $7,000 per employee for each calendar quarter through September 30, 2021. The Company recognized a $0.3 million employee retention credit during the three months ended March 31, 2021, which was offset against payroll tax expense.

Credit Agreement

On January 19, 2021, the Company and the Lender entered into an amendment to the credit agreement, originally entered into on March 25, 2020, that increased the amount available under delayed draw term loans by $1.0 million, and issued an additional 1,000,000 Series G Warrants. The Company evaluated the accounting related to the amendment and in conjunction with the warrants issued. Based on this analysis the Company determined the agreements are substantially different and extinguished the original credit agreement and recorded the amended credit agreement as a new debt at a fair value of $10.0 million. As a result, during the three months ended March 31, 2021, the Company recorded a debt discount of approximately $0.5 million and a $3.0 million loss on extinguishment of debt, which is comprised of the fair value of the warrants and unamortized debt issuance cost with the original credit agreement, offset by the debt discount. At March 31, 2021, there was approximately $0.1 million of unamortized debt discount. Pursuant to the amendment of the credit agreement, the maturity date of the loans are March 31, 2021 and the loans bear interest at LIBOR plus 2.5%.

On March 10, 2021, the Company and the Lender entered into an amendment to the credit agreement that extended the maturity date from March 31, 2021 to March 31, 2022. The Company has accounted for this amendment as a debt modification. The associated unamortized debt discount on the January 19, 2021 amendment of $0.1 million was amortized as interest expense over the term of the amended credit agreement.

On June 28, 2021, the Company entered into a warrant exercise agreement with existing investors, including the Lender, to exercise certain outstanding warrants. For further details on this transaction see Note 9. The Company used some of the proceeds from this transaction to pay off the $10.5 million of debt outstanding under the credit agreement.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-URI https://asc.fasb.org/topic&trid=2208564

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (h)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (c)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (d)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(c))
-URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (g)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1E
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495348-112611

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (i)
-URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

+ Details

Leases

6 Months Ended

Jun. 30, 2022

Leases

Leases

(6) Leases

The Company has noncancelable operating leases for office and warehouse space in San Clemente and Carlsbad, California, as well as noncancelable operating leases for certain office equipment that expire at various dates through 2022. The Company does not have any short-term leases or financing lease arrangements. The Company extended the San Clemente lease by twelve months with an end date of June 30, 2023 and extended the Carlsbad lease by three months with an end date of June 30, 2022. Certain of the Company’s equipment leases include variable lease payments that are adjusted periodically based on actual usage. Lease and non-lease components are accounted for separately.

Operating lease costs were $0.2 million and $0.1 million for the three months ended June 30, 2022 and 2021, respectively, and $0.4 million and $0.3 million for the six months ended June 30, 2022 and 2021, respectively. Variable lease costs were not material.

Supplemental information related to operating leases is as follows:


	June 30,		December 31,
Balance Sheet information	2022		2021
Operating lease ROU assets	$	338	$	266

Operating lease liabilities, current portion	$	338	$	279
Operating lease liabilities, long-term portion		—		—
Total operating lease liabilities	$	338	$	279

Cash flow information for the six months ended June 30,	2022		2021
Cash paid for amounts included in the measurement of operating leases liabilities	$	386	$	165

Maturities of operating lease liabilities were as follows:


Remainder of 2022	$	174
2023		173
2024		—
Total lease payments		347
Less: imputed interest		9
Total lease liabilities	$	338

Weighted-average remaining lease term at end of period (in years)		0.9
Weighted-average discount rate at end of period		5.1	%

Acquisition

6 Months Ended

Jun. 30, 2022

Acquisition

Acquisition

(7) Acquisition

On June 15, 2021, the Company completed the previously announced merger with Obalon, which was treated as a reverse acquisition for accounting purposes, for an aggregate purchase price of $30.6 million. This includes the issuance of 3,340,035 shares of common stock valued at $30.6 million at the closing market price on the day of merger and the cancellation of 2,680,301 shares of common stock. As a result of the controlling interest of the former shareholders of ReShape, for financial statement reporting and accounting purposes, ReShape was considered the acquirer under the acquisition method of accounting in accordance with ASC 805-10-55. The reverse acquisition is deemed a capital transaction in substance whereas the historical assets and liabilities of Obalon before the business combination were replaced with the historical financial statements of ReShape in all future filings with the SEC. There were no acquisition related costs recognized for the three months and six months ended June 30, 2022.

Tangible and intangible assets acquired were recorded based on their estimated fair values at the acquisition date. The excess of the purchase price over the fair value of the net assets acquired was recorded to goodwill. The following table summarizes the fair values of the assets acquired and liabilities assumed, primarily related to inventory, developed technology, goodwill (including the deductibility for tax purposes) and income tax related accruals:


Current assets	$	5,887
Property and equipment, net		796
Right-of-use assets		335
Other assets		1,898
Goodwill		21,566
Developed technology		2,730
Liabilities assumed		(2,650)
Total purchase price		30,562
Less: cash acquired		(5,207)
Total purchase price, net of cash acquired	$	25,355

As part of the warrant agreements there was a provision that would provide the holders, at their election, a cash payment based on a Black-Scholes valuation of the warrants in connection with certain fundamental transactions. This clause could be exercised by the holders for 30 days subsequent to the date of the transaction. The Company performed a preliminary valuation of the warrants and recorded a liability at the time of the merger of $2.0 million. During the third quarter of 2021, the Company completed its valuation of these warrants which resulted in a liability for the warrants of $1.3 million, a decrease of $0.7 million, which had a corresponding decrease to goodwill. The Company had one of the holders exercise the fundamental transaction option, and rather than paying cash both parties agreed on the Company issuing shares of common stock and new warrants to this investor. See Notes 8 and 9 below for additional details. As the 30 day period passed, the Company valued the remaining warrants using a Black-Scholes model with an exercise price ranging from $13.20 to $15.00 per share, a risk free rate of 0.44%, a volatility rate of 122.1% and a dividend rate of 0. This resulted in a total fair value of $0.9 million as of July 15, 2021, with the change in fair value being recognized as a component of warrant expense. The ending liability of $0.5 million was reclassified from a current liability to additional paid-in capital.

Goodwill includes expected synergies and other benefits the Company believes will result from the acquisition. The developed technology has been capitalized at fair value as an intangible asset with an estimated life of 15 years. The developed technology was determined using the income approach. This approach determines fair value based on cash flow projections which are discounted to present value using a risk-adjusted rate of return, using nonrecurring Level 3 inputs. The discount rate used was 22.0%. For the year ended December 31, 2021, the Company fully impaired goodwill due to the decline in market capitalization.

Equity

6 Months Ended

Jun. 30, 2022

Equity

Equity

(8) Equity

Common Stock Issued Related to Restricted Stock Units

During the three and six months ended June 30, 2022, the Company issued 143,544 shares of common stock and 909,191 shares of common stock subject to vesting of the restricted stock units. There were no shares issued during the three and six months ended June 30, 2021. For further details see Note 12.

June 2022 Exercises of Warrants for Common Stock

On June 16, 2022, the Company entered into a warrant exercise agreement with an existing accredited investor to exercise certain outstanding warrants to purchase up to an aggregate of 3.7 million shares of common stock, of which 0.9 million shares were issued in June in accordance with the terms of the warrant exercise agreement, and 2.9 shares are held in abeyance. 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 3.7 million shares (equal to 100% of the shares of common shares exercised) of the Company’s common stock (the “New Warrants”) in a private placement pursuant to Section (4)(2) of the Securities Act. In connection with the exercise, the Company also agreed to reduce the exercise price of the existing warrants and 1.6 million remaining unexercised warrants from $6.00 to $0.6665 per share, which is

equal to the most recent closing price of the Company’s common stock on the Nasdaq prior to the execution of the warrant exercise agreement. For further details on the warrants see Note 9 below.

The gross proceeds to the Company from the exercise was approximately $2.5 million, prior to deducting warrant inducement agent frees and estimated offering expenses. The Company intends to use the remainder of the net proceeds for commercial growth, working capital and general corporate purposes.

August 2021 Issuance of Common Stock for Services

On August 11, 2021, the Company entered into a consulting agreement in which the Company issued to the consultant 37,500 shares of restricted common stock for the consulting services in a private placement in reliance on Rule 4(a)(2) under the Securities Act of 1933, as amended (the “Securities Act”). The shares were deemed earned on the day of the agreement and became unrestricted six months after the agreement date which is when the contract term ends.

July 2021 Exchange of Warrants for Common Stock

On July 16, 2021, the Company entered into an exchange agreement (the “Exchange Agreement”) with existing institutional investors to exchange certain outstanding warrants (the “Exchange Warrants”) for shares of common stock and new warrants to purchase common stock. The investors held common stock purchase warrants issued by the Company prior to the merger of Obalon and ReShape. The merger constituted a fundamental transaction under the Exchange Warrants and, as a result thereof, pursuant to the terms and conditions of the Exchange Warrants, the investors were entitled to a cash payment equal to the Black Scholes value of the Exchange Warrants, calculated in accordance with the terms of the Exchange Warrants (the “Black Scholes Payment”).

Subject to the terms and conditions set forth in the Exchange Agreement and, in reliance on Section 3(a)(9) of the Securities Act, in lieu of the Black Scholes Payment, the Company and the Investors agreed to exchange all of the Exchange Warrants for (a) a total of 504,861 shares of common stock, which was calculated by dividing the Black Scholes Payment by $4.038, which was equal to 95% of the closing market price of the Company’s common stock on The Nasdaq Capital Market on July 16, 2021 and (b) new warrants to purchase up to a total of 400,000 shares of common stock at an exercise price of $4.038 with a term of five years. For further details on the warrants see Note 9 below.

June 2021 Exercises of Warrants for Common Stock

On June 28, 2021, the Company 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, of which 7.1 million shares were issued in July 2021, in accordance with the terms of the warrant exercise agreement. 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 “New Warrants”) in a private placement pursuant to Section 4(a)(2) of the Securities Act. 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. For further details on the warrants see Note 9 below.

The gross proceeds to the Company from the exercise and the sale of the New Warrants was approximately $45.5 million, prior to deducting placement agent fees and estimated offering expenses. The Company used approximately $10.8 million to pay off the credit agreement, including $10.5 million of debt and $0.3 million of accrued interest under its secured credit agreement dated March 25, 2020, as amended, see Note 5 above for further details. The Company intends to use the remainder of the net proceeds for working capital and general corporate purposes.

On June 18, 2021, the Company issued 100,000 shares of common stock to two healthcare focused institutional investors, totaling 200,000 shares of common stock and on June 21, 2021, the Company issued 130,445 and 57,229 shares of common stock to two healthcare focused institutional investors totaling 187,674 shares of common stock, as an exercise of pre-funded warrants issued in connection with the September 2019 private placement transactions. The Company received approximately $0.1 million in connection with the exercises.

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

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+ Details

Warrants

6 Months Ended

Jun. 30, 2022

Warrants.

Warrants

(9) Warrants

On June 16, 2022, the Company entered into a warrant exercise agreement with an existing accredited investor to exercise certain outstanding warrants. As part of this agreement the Company modified the warrants issued June 28, 2021, from an exercise price of $6.00 to $0.6665 per share. The Company issued a total of 3,738,642 shares of common stock in connection with this transaction and issued an additional 3,738,642 new warrants. These new warrants were valued at $1.7 million using the fair value approach at the time of issuance. The fair value of the new warrants was determined using a Black Scholes option pricing model using a risk free rate of 3.32%, and expected term of 7.5 years, expected dividends of zero and expected volatility of 64.8%.

On July 16, 2021, the Company entered into an exchange agreement with an existing accredited investor to exchange certain outstanding warrants for shares of common stock and issued new warrants to purchase up to total of 400,000 shares of common stock at an exercise price of $4.038 per share with a term of 5 years. These new warrants were valued at $1.5 million using the fair value approach at the time of issuance. The fair value of the new warrants was determined using a Black Scholes option pricing model using a risk free rate of 0.79%, an expected term of five years, expected dividends of zero and expected volatility of 157.7%.

On June 28, 2021, the Company entered into a warrant exercise agreement with existing accredited investors to exercise certain outstanding warrants. As part of this agreement the Company modified the Series E warrants issued September 23, 2019 from an exercise price of $10.64 per share to $6.00 per share, the Series G warrants issued on March 25, 2020 from an exercise price of $6.56 per share to $6.00 per share, the Series G warrants issued on December 17, 2020 from an exercise price of $6.21 per share to $6.00 per share and the Series G warrants issued on January 21, 2021 from an exercise price of $6.21 per share to $6.00 per share. The Company issued a total of 7,929,384 shares of common stock in connection with this transaction and issued an additional 5,947,039 new warrants. These new warrants were valued at $18.5 million using the fair value approach at the time of issuance. The fair value the new warrants was determined using a Black Scholes option pricing model using a risk free rate of 0.898%, an expected term of five years, expected dividends of zero and expected volatility of 97.6%.

On January 19, 2021, the Company issued 1,000,000 Series G Warrants, pre-merger, which were adjusted by the exchange ratio in the merger, to an institutional investor in connection with an amendment to the credit agreement. The Series G Warrants were valued at $3.0 million using the fair value approach at the time of issuance and was recorded as a component of the loss on extinguishment of debt during the three months ended March 31, 2021. See Note 5 above for details. The fair value of the Series G Warrants was determined using a Black Scholes option pricing model using a risk free rate of 0.45%, an expected term of five years; expected dividends of zero and expected volatility of 97.1%.

Revenue Disaggregation and Operating Segments

6 Months Ended

Jun. 30, 2022

Revenue Disaggregation and Operating Segments

Revenue Disaggregation and Operating Segments

(10) Revenue Disaggregation and Operating Segments

The Company conducts operations worldwide and has sales in the following regions: United States, Australia, Europe and Rest of World. For the three months and six months ended June 30, 2022 and 2021, the Company primarily only sold the Lap-Band system. The following table presents the Company’s revenue disaggregated by geography:


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2022		2021		2022		2021
United States	$	2,308	$	2,633	$	4,152	$	5,153
Australia		188		277		369		570
Europe		389		590		803		969
Rest of world		7		29		8		58
Total revenue	$	2,892	$	3,529	$	5,332	$	6,750

Operating Segments

The Company conducts operations worldwide and is managed in the following geographical regions: United States, Australia, Europe and the Rest of World (primarily in the Middle East). All regions sell the Lap-Band system, which consisted of nearly all our revenue and gross profit for the three and six months ended June 30, 2022 and 2021. During the three and six months ended June 30, 2022 and 2021, there was minimal revenue for reshapecare. There was no revenue or gross profit recorded for the ReShape Vest or Diabetes Bloc-Stim Neuromodulation for the three months

and six months ended June 30, 2022 and 2021 as these two products are still in the development stage. There was also no revenue recorded for the recently acquired Obalon line.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

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+ Details

Income Taxes

6 Months Ended

Jun. 30, 2022

Income Taxes

Income Taxes

(11) Income Taxes

During the three months June 30, 2022, income tax expense was insignificant, and during the six months ended June 30, 2022, a $0.1 million tax benefit, respectively, was recorded primarily due to a reduction in the valuation allowance related to an impairment of indefinite lived assets partially offset by state and foreign taxes. During the three months and six months ended June, 2021, a $28 thousand and $53 thousand, respectively, tax expense was recorded, primarily due to projected income in Australia and the Netherlands. The income tax provisions for the six months ended June 30, 2022, and year ended December 31, 2021, were calculated using the discrete year-to-date method. The effective tax rate differs from the statutory tax rate of 21% primarily due to the existence of valuation allowances against net deferred tax assets and current liabilities resulting from the estimated state income tax liabilities and foreign tax liability.

In assessing the realization of deferred tax assets, the Company considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during periods in which those temporary differences become deductible. Based on the level of historical losses, projections of losses in future periods and potential limitations pursuant to changes in ownership under Internal Revenue Code Section 382, the Company provided a valuation allowance at both June 30, 2022 and December 31, 2021.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

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+ Details

Stock-based Compensation

6 Months Ended

Jun. 30, 2022

Stock-based Compensation

Stock-based Compensation

(12) Stock-based Compensation

Stock-based compensation expense related to stock options and RSUs issued under the ReShape Lifesciences Inc. Second Amended and Restated 2003 Stock Incentive Plan (the “Plan”) for the three months and six ended June 30, 2022 and 2021 were as follows:


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2022		2021		2022		2021
Sales and marketing	$	152	$	—	$	257	$	—
General and administrative		550		(364)		1,120		(263)
Research and development		121		—		193		—
Total stock-based compensation expense	$	823	$	(364)	$	1,570	$	(263)

Stock Options

A summary of the status of the Company’s stock options as of June 30, 2022, and changes during the six months ended June 30, 2022 are as follows:


				Weighted
		Weighted		Average	Aggregate
		Average		Remaining	Intrinsic
		Exercise Price		Contractual	Value
	Shares	Per Share		Life (years)	(in thousands)
Outstanding at December 31, 2021	885,039		7.97		$	—
Options granted	560,154		1.18
Options exercised	—		—
Options cancelled	(136,862)		2.83
Outstanding at June 30, 2022	1,308,331		5.60	8.9	$	—
Exercisable at June 30, 2022	617,796		9.83	8.1		—
Vested and expected to vest at June 30, 2022	1,308,331		5.60	8.9		—

There was no intrinsic value of the outstanding stock options at June 30, 2022. The unrecognized share-based expense at June 30, 2022 was $1.1 million and will be recognized over a weighted average period of 3.0 years.

Stock option awards outstanding under the Company’s incentive plans have been granted at exercise prices that are equal to the market value of its common stock on the date of grant. Such options generally vest over a period of four years and expire at ten years after the grant date. The Company recognized compensation expense ratably over the vesting period. The Company uses a Black-Scholes option-pricing model to estimate the fair value of stock options granted, which requires the input of both subjective and objective assumptions as follows:

Expected Term – The estimate of expected term is based on the historical exercise behavior of grantees, as well as the contractual life of the options granted.

Expected Volatility – The expected volatility factor is based on the volatility of the Company’s common stock for a period equal to the term of the stock options.

Risk-free Interest Rate – The risk-free interest rate is determined using the implied yield for a traded zero-coupon U.S. Treasury bond with a term equal to the expected term of the stock options.

Expected Dividend Yield – The expected dividend yield is based on the Company’s historical practice of paying dividends on its common stock.

Restricted Stock Units

During the six months ended June 30, 2022, the Company granted 200,417 RSUs and cancelled 142,604 RSUs.

A summary of the Company’s unvested RSUs award activity for the six months ended June 30, 2022, were as follows:


		Weighted
		Average
		Grant Date
	Shares	Fair Value
Unvested RSUs at December 31, 2021	1,711,318	$	4.36
Granted	200,417		1.18
Vested ⁽¹⁾	(949,039)		4.36
Cancelled/Forfeited	(142,604)		4.36
Non-vested RSUs at June 30, 2022	820,092		3.58

(1)	At June 30, 2022, there were 39,848 shares of common stock related to RSU awards that had vested and the shares were not distributed to the participants until July of 2022.

The fair value of each RSU is the closing stock price on the Nasdaq of the Company’s common stock on the date of grant. Upon vesting, a portion of the RSU award may be withheld to satisfy the statutory income tax withholding obligation. The remaining RSUs will be settled in shares of the Company’s common stock after the vesting period. The unrecognized compensation cost related to the RSUs at June 30, 2022 was $2.9 million and expected to be recognized over a period of 2.0 years.

Commitments and Contingencies

6 Months Ended

Jun. 30, 2022

Commitments and Contingencies

Commitments and Contingencies

(13) Commitment and Contingencies

Litigation

On August 6, 2021, Cowen and Company, LLC (“Cowen”) filed a complaint against ReShape, as successor in interest to Obalon Therapeutics, in the Supreme Court of the State of New York based on an alleged breach of contract arising out of Cowen’s prior engagement as Obalon’s financial advisor. The complaint alleges that Cowen is entitled to be paid a $1.35 million fee in connection with ReShape’s merger with Obalon under the terms of Cowen’s engagement agreement with Obalon. The complaint also seeks reimbursement of Cowen’s attorneys’ fees and interest in connection with its claim. The Company is unable to predict the ultimate outcome of this matter and the Company intends to vigorously defend this matter.

On August 18, 2021, H.C. Wainwright & Co., LLC (“Wainwright”) filed a complaint against ReShape in the Supreme Court of the State of New York based on an alleged breach of contract arising out of Wainwright’s prior engagement by ReShape in connection with certain capital raising transactions by ReShape. The complaint alleged that Wainwright was entitled to be paid a fee in connection with ReShape’s capital raising transaction under the warrant exercise agreement that ReShape entered into on June 28, 2021. Wainwright alleged that its June and September 2019 engagement agreements with ReShape require ReShape to pay Wainwright a cash fee equal to 8.0% of the gross proceeds that ReShape received from the exercise of warrants issued pursuant to those engagement agreements, including warrants that were exercised in the June 2021 transaction. The complaint also sought reimbursement of Wainwright’s attorneys’ fees and interest in connection with its claim. On July 19, 2022, the Company entered into a definitive settlement and release agreement with Wainwright pursuant to which the Company made a one-time cash payment of $1.0 million to fully and finally resolve such matter.

The Company is not aware of any pending or threatened litigation against it that could have a material adverse effect on the Company’s business, operating results or financial condition, other than what is disclosed above. The medical device industry in which the Company operates is characterized by frequent claims and litigation, including claims regarding patent and other intellectual property rights as well as improper hiring practices. As a result the Company may be involved in various legal proceedings from time to time. As of June 30, 2022, the Company has accrued $2.0 million for potential legal settlements.

Product Liability Claims

The Company is exposed to product liability claims that are inherent in the testing, production, marketing and sale of medical devices. Management believes any losses that may occur from these matters are adequately covered by insurance, and the ultimate outcome of these matters will not have a material effect on the Company’s financial position or results of operations. The Company is not currently a party to any product liability litigation and is not aware of any pending or threatened product liability litigation that is reasonably possible to have a material adverse effect on the Company’s business, operating results or financial condition.

Subsequent Events

6 Months Ended

Jun. 30, 2022

Subsequent Events

Subsequent Events

(14) Subsequent Events

On July 27, 2022, the Company announced that its Board of Directors has appointed Paul F. Hickey as President and Chief Executive Officer and a member of the Board of Directors, effective August 15, 2022. Mr. Hickey succeeds Bart Bandy, who has separated from the Company to pursue other opportunities. Within the terms of the separation agreement, Mr. Bandy is entitled to a severance package which has been accrued for in July 2022. Thomas Stankovich, Chief Financial Officer of the Company, will serve as Interim President and Chief Executive Officer until Mr. Hickey joins the Company. Dan W. Gladney, current Chair of the Board of Directors, will assume a more active role as Executive Chair, supporting Mr. Hickey and the Company on strategic matters.

On July 19, 2022, the Company entered into a definitive settlement and release agreement with Wainwright pursuant to which the Company made a one-time cash payment of $1.0 million, for further details on this settlement see Note 13 above.

Basis of Presentation (Policies)

6 Months Ended

Jun. 30, 2022

Basis of Presentation

Basis of Presentation

Revision of Previously Issued Financial Statement for Correction of Immaterial Errors

The following table summarizes the effect of the revision on each financial statement line item for the periods ended as indicated:


	Condensed Consolidated Statement of Operations
	As Previously
	Reported		Adjustment		As Revised
For the year ended December 31, 2020
Net loss per share - basic and diluted:
Net loss per share - basic and diluted	$	(5.54)	$	(0.01)	$	(5.55)
Shares used to compute basic and diluted net loss per share		3,904,762		(6,612)		3,898,150
Three months ended March 31, 2021
Net loss per share - basic and diluted:
Net loss per share - basic and diluted	$	(1.24)	$	—	$	(1.24)
Shares used to compute basic and diluted net loss per share		3,927,986		10,159		3,938,145
Three months ended June 30, 2021
Net loss per share - basic and diluted:
Net loss per share - basic and diluted	$	(0.47)	$	(0.39)	$	(0.86)
Shares used to compute basic and diluted net loss per share		8,226,144		(3,672,168)		4,553,976
Six months ended June 30, 2021
Net loss per share - basic and diluted:
Net loss per share - basic and diluted	$	(1.11)	$	(0.96)	$	(2.07)
Shares used to compute basic and diluted net loss per share		7,928,702		(3,682,642)		4,246,060
Three months ended September 30, 2021
Net loss per share - basic and diluted:
Net loss per share - basic and diluted	$	(1.48)	$	0.44	$	(1.04)
Shares used to compute basic and diluted net loss per share		11,997,370		5,090,884		17,088,254
Nine months ended September 30, 2021
Net loss per share - basic and diluted:
Net loss per share - basic and diluted	$	(2.51)	$	(0.56)	$	(3.07)
Shares used to compute basic and diluted net loss per share		10,546,683		(1,932,362)		8,614,321
For the year ended December 31, 2021
Net loss per share - basic and diluted:
Net loss per share - basic and diluted	$	(5.00)	$	(0.67)	$	(5.67)
Shares used to compute basic and diluted net loss per share		12,378,502		(1,452,519)		10,925,983
Three months ended March 31, 2022
Net loss per share - basic and diluted:
Net loss per share - basic and diluted	$	(0.44)	$	0.00	$	(0.44)
Shares used to compute basic and diluted net loss per share		18,539,568		11,700		18,551,268

Reverse Stock Split and Merger Exchange Ratio

Use of Estimates

Acquisition

Goodwill and Long-Lived Assets

Goodwill represents the excess of the cost of an acquired business over the fair value of the identifiable tangible and intangible assets acquired and liabilities assumed in a business combination.

Fair Value of Financial Instruments

Net Loss Per Share


	June 30,
	2022	2021
Stock options	820,092	256,881
Convertible preferred stock	38	742
Warrants	6,952,328	6,181,997

Recent Accounting Pronouncements

There were no new accounting standards adopted by the Company during the six months ended June 30, 2022.

New accounting standards not yet adopted are discussed below.

Basis of Presentation (Tables)

6 Months Ended

Jun. 30, 2022

Basis of Presentation

Summary of the effect of the revision on condensed consolidated statement of operations

The following table summarizes the effect of the revision on each financial statement line item for the periods ended as indicated:


	Condensed Consolidated Statement of Operations
	As Previously
	Reported		Adjustment		As Revised
For the year ended December 31, 2020
Net loss per share - basic and diluted:
Net loss per share - basic and diluted	$	(5.54)	$	(0.01)	$	(5.55)
Shares used to compute basic and diluted net loss per share		3,904,762		(6,612)		3,898,150
Three months ended March 31, 2021
Net loss per share - basic and diluted:
Net loss per share - basic and diluted	$	(1.24)	$	—	$	(1.24)
Shares used to compute basic and diluted net loss per share		3,927,986		10,159		3,938,145
Three months ended June 30, 2021
Net loss per share - basic and diluted:
Net loss per share - basic and diluted	$	(0.47)	$	(0.39)	$	(0.86)
Shares used to compute basic and diluted net loss per share		8,226,144		(3,672,168)		4,553,976
Six months ended June 30, 2021
Net loss per share - basic and diluted:
Net loss per share - basic and diluted	$	(1.11)	$	(0.96)	$	(2.07)
Shares used to compute basic and diluted net loss per share		7,928,702		(3,682,642)		4,246,060
Three months ended September 30, 2021
Net loss per share - basic and diluted:
Net loss per share - basic and diluted	$	(1.48)	$	0.44	$	(1.04)
Shares used to compute basic and diluted net loss per share		11,997,370		5,090,884		17,088,254
Nine months ended September 30, 2021
Net loss per share - basic and diluted:
Net loss per share - basic and diluted	$	(2.51)	$	(0.56)	$	(3.07)
Shares used to compute basic and diluted net loss per share		10,546,683		(1,932,362)		8,614,321
For the year ended December 31, 2021
Net loss per share - basic and diluted:
Net loss per share - basic and diluted	$	(5.00)	$	(0.67)	$	(5.67)
Shares used to compute basic and diluted net loss per share		12,378,502		(1,452,519)		10,925,983
Three months ended March 31, 2022
Net loss per share - basic and diluted:
Net loss per share - basic and diluted	$	(0.44)	$	0.00	$	(0.44)
Shares used to compute basic and diluted net loss per share		18,539,568		11,700		18,551,268

Schedule of anti-dilutive securities


	June 30,
	2022	2021
Stock options	820,092	256,881
Convertible preferred stock	38	742
Warrants	6,952,328	6,181,997

Supplemental Balance Sheet Information (Tables)

6 Months Ended

Jun. 30, 2022

Supplemental Balance Sheet Information

Schedule of components of inventory


	June 30,		December 31,
	2022		2021
Raw materials	$	1,050	$	829
Sub-assemblies		1,202		682
Finished goods		1,974		1,492
Total inventory	$	4,226	$	3,003

Schedule of components of prepaid expenses and other current assets


	June 30,		December 31,
	2022		2021
Prepaid insurance	$	716	$	736
Prepaid advertising and marketing		356		698
Other current assets		197		188
Total prepaid expenses and other current assets	$	1,269	$	1,622

Schedule of components of accrued and other liabilities


	June 30,		December 31,
	2022		2021
Payroll and benefits	$	2,362	$	1,527
Accrued legal settlements		2,000		—
Customer deposits		605		549
Taxes		190		307
Accrued insurance premium		151		301
Accrued professional		284		300
Other liabilities		222		185
Total accrued and other liabilities	$	5,814	$	3,169

Goodwill and Intangible Assets (Tables)

6 Months Ended

Jun. 30, 2022

Goodwill and Intangible Assets

Summary of identifiable intangible assets


	June 30, 2022
	Weighted Average Useful Life (years)	Gross Carrying Amount		Accumulated Amortization		Net Book Value
Finite-lived intangible assets:
Developed technology	10.8	$	17,092	$	(5,276)	$	11,816
Trademarks/Tradenames	10.0		2,045		(893)		1,152
Covenant not to compete	3.0		76		(76)		—
			19,213		(6,245)		12,968
Indefinite-lived intangible assets:
In-process research and development	indefinite		6,947		—		6,947
Total		$	26,160	$	(6,245)	$	19,915


	December 31, 2021
	Weighted Average Useful Life (years)	Gross Carrying Amount		Accumulated Amortization		Net Book Value
Finite-lived intangible assets:
Developed technology	10.8	$	17,092	$	(4,467)	$	12,625
Trademarks/Tradenames	10.0		2,045		(790)		1,255
Covenant not to compete	3.0		76		(76)		—
			19,213		(5,333)		13,880
Indefinite-lived intangible assets:
In-process research and development	indefinite		6,947		—		6,947
Total		$	26,160	$	(5,333)	$	20,827

Leases (Tables)

6 Months Ended

Jun. 30, 2022

Leases

Schedule of supplemental information related to operating leases


	June 30,		December 31,
Balance Sheet information	2022		2021
Operating lease ROU assets	$	338	$	266

Operating lease liabilities, current portion	$	338	$	279
Operating lease liabilities, long-term portion		—		—
Total operating lease liabilities	$	338	$	279

Cash flow information for the six months ended June 30,	2022		2021
Cash paid for amounts included in the measurement of operating leases liabilities	$	386	$	165

Schedule of maturities of operating lease liabilities


Remainder of 2022	$	174
2023		173
2024		—
Total lease payments		347
Less: imputed interest		9
Total lease liabilities	$	338

Weighted-average remaining lease term at end of period (in years)		0.9
Weighted-average discount rate at end of period		5.1	%

Acquisitions (Tables)

6 Months Ended

Jun. 30, 2022

Acquisition

Schedule of fair values of the assets acquired and liabilities assumed


Current assets	$	5,887
Property and equipment, net		796
Right-of-use assets		335
Other assets		1,898
Goodwill		21,566
Developed technology		2,730
Liabilities assumed		(2,650)
Total purchase price		30,562
Less: cash acquired		(5,207)
Total purchase price, net of cash acquired	$	25,355

Revenue Disaggregation and Operating Segments (Tables)

6 Months Ended

Jun. 30, 2022

Revenue Disaggregation and Operating Segments

Schedule of revenue disaggregated by product and geography


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2022		2021		2022		2021
United States	$	2,308	$	2,633	$	4,152	$	5,153
Australia		188		277		369		570
Europe		389		590		803		969
Rest of world		7		29		8		58
Total revenue	$	2,892	$	3,529	$	5,332	$	6,750

Stock-based Compensation (Tables)

6 Months Ended

Jun. 30, 2022

Stock-based Compensation

Schedule of stock-based compensation expense


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2022		2021		2022		2021
Sales and marketing	$	152	$	—	$	257	$	—
General and administrative		550		(364)		1,120		(263)
Research and development		121		—		193		—
Total stock-based compensation expense	$	823	$	(364)	$	1,570	$	(263)

Summary of stock option activity


				Weighted
		Weighted		Average	Aggregate
		Average		Remaining	Intrinsic
		Exercise Price		Contractual	Value
	Shares	Per Share		Life (years)	(in thousands)
Outstanding at December 31, 2021	885,039		7.97		$	—
Options granted	560,154		1.18
Options exercised	—		—
Options cancelled	(136,862)		2.83
Outstanding at June 30, 2022	1,308,331		5.60	8.9	$	—
Exercisable at June 30, 2022	617,796		9.83	8.1		—
Vested and expected to vest at June 30, 2022	1,308,331		5.60	8.9		—

Summary of unvested RSUs award activity


		Weighted
		Average
		Grant Date
	Shares	Fair Value
Unvested RSUs at December 31, 2021	1,711,318	$	4.36
Granted	200,417		1.18
Vested ⁽¹⁾	(949,039)		4.36
Cancelled/Forfeited	(142,604)		4.36
Non-vested RSUs at June 30, 2022	820,092		3.58

(1)	At June 30, 2022, there were 39,848 shares of common stock related to RSU awards that had vested and the shares were not distributed to the participants until July of 2022.

Basis of Presentation (Details) $ in Thousands		3 Months Ended		6 Months Ended
Basis of Presentation (Details) $ in Thousands	Jun. 15, 2021	Jun. 30, 2022 USD ($)	Jun. 30, 2021 USD ($)	Jun. 30, 2022 USD ($) shares	Jun. 30, 2021 USD ($) shares
Anti-dilutive securities
Reverse stock split ratio	0.333
Loss on impairment of intangible asset and goodwill \| $		$ 0	$ 0	$ 0	$ 0
Obalon Therapeutics Inc.
Anti-dilutive securities
Stock exchange ratio	0.5367
Stock options
Anti-dilutive securities
Anti-dilutive securities (in shares)				820,092	256,881
Convertible preferred stock
Anti-dilutive securities
Anti-dilutive securities (in shares)				38	742
Warrants to purchase common stock
Anti-dilutive securities
Anti-dilutive securities (in shares)				6,952,328	6,181,997

Basis of Presentation - Effect of Revision on Condensed Consolidated Statement of Operations (Details) - $ / shares	3 Months Ended					6 Months Ended		9 Months Ended	12 Months Ended
	Jun. 30, 2022	Mar. 31, 2022	Sep. 30, 2021	Jun. 30, 2021	Mar. 31, 2021	Jun. 30, 2022	Jun. 30, 2021	Sep. 30, 2021	Dec. 31, 2021	Dec. 31, 2020
Net loss per share - basic and diluted:
Net loss per share - basic (in dollars per share)	$ (0.50)	$ (0.44)	$ (1.04)	$ (0.86)	$ (1.24)	$ (0.94)	$ (2.07)	$ (3.07)	$ (5.67)	$ (5.55)
Net loss per share - diluted (in dollars per share)	$ (0.50)	$ (0.44)	$ (1.04)	$ (0.86)	$ (1.24)	$ (0.94)	$ (2.07)	$ (3.07)	$ (5.67)	$ (5.55)
Shares used to compute basic net loss per share	19,310,968	18,551,268	17,088,254	4,553,976	3,938,145	18,933,217	4,246,060	8,614,321	10,925,983	3,898,150
Shares used to compute diluted net loss per share	19,310,968	18,551,268	17,088,254	4,553,976	3,938,145	18,933,217	4,246,060	8,614,321	10,925,983	3,898,150
As Previously Reported
Net loss per share - basic and diluted:
Net loss per share - basic (in dollars per share)		$ (0.44)	$ (1.48)	$ (0.47)	$ (1.24)		$ (1.11)	$ (2.51)	$ (5.00)	$ (5.54)
Net loss per share - diluted (in dollars per share)		$ (0.44)	$ (1.48)	$ (0.47)	$ (1.24)		$ (1.11)	$ (2.51)	$ (5.00)	$ (5.54)
Shares used to compute basic net loss per share		18,539,568	11,997,370	8,226,144	3,927,986		7,928,702	10,546,683	12,378,502	3,904,762
Shares used to compute diluted net loss per share		18,539,568	11,997,370	8,226,144	3,927,986		7,928,702	10,546,683	12,378,502	3,904,762
Adjustment
Net loss per share - basic and diluted:
Net loss per share - basic (in dollars per share)		$ 0.00	$ 0.44	$ (0.39)			$ (0.96)	$ (0.56)	$ (0.67)	$ (0.01)
Net loss per share - diluted (in dollars per share)		$ 0.00	$ 0.44	$ (0.39)			$ (0.96)	$ (0.56)	$ (0.67)	$ (0.01)
Shares used to compute basic net loss per share		11,700	5,090,884	(3,672,168)	10,159		(3,682,642)	(1,932,362)	(1,452,519)	(6,612)
Shares used to compute diluted net loss per share		11,700	5,090,884	(3,672,168)	10,159		(3,682,642)	(1,932,362)	(1,452,519)	(6,612)

- Definition

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

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- Definition

The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period.

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+ Details

Liquidity and Management's Plans (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021	Jun. 30, 2021	Dec. 31, 2020
Liquidity and Management's Plans
Working capital	$ 10,300
Cash and cash equivalents and restricted cash	11,544	$ 22,815	$ 40,213	$ 3,007
Accounts receivable	$ 2,448	$ 2,815

Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Inventory:
Raw materials	$ 1,050	$ 829
Sub-assemblies	1,202	682
Finished goods	1,974	1,492
Total inventory	4,226	3,003
Prepaid expenses and other current assets:
Prepaid insurance	716	736
Prepaid advertising and marketing	356	698
Other current assets	197	188
Total prepaid expenses and other current assets	1,269	1,622
Accrued and other liabilities:
Payroll and benefits	2,362	1,527
Accrued legal settlements	2,000
Customer deposits	605	549
Taxes	190	307
Accrued insurance premium	151	301
Accrued professional	284	300
Other liabilities	222	185
Total accrued and other liabilities	$ 5,814	$ 3,169

Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021
Acquisition.
Amortization expense	$ 500	$ 400	$ 911	$ 828
Gross Carrying Amount	19,213		19,213		$ 19,213
Accumulated amortization	(6,245)		(6,245)		(5,333)
Total finite-lived intangible assets	12,968		12,968		13,880
Gross carrying amount	26,160		26,160		26,160
Net book value	19,915		$ 19,915		$ 20,827
Developed technology
Acquisition.
Useful Life (years)			10 years 9 months 18 days		10 years 9 months 18 days
Gross Carrying Amount	17,092		$ 17,092		$ 17,092
Accumulated amortization	(5,276)		(5,276)		(4,467)
Total finite-lived intangible assets	11,816		$ 11,816		$ 12,625
Trademarks/Tradenames
Acquisition.
Useful Life (years)			10 years		10 years
Gross Carrying Amount	2,045		$ 2,045		$ 2,045
Accumulated amortization	(893)		(893)		(790)
Total finite-lived intangible assets	1,152		$ 1,152		$ 1,255
Covenant not to compete
Acquisition.
Useful Life (years)			3 years		3 years
Gross Carrying Amount	76		$ 76		$ 76
Accumulated amortization	(76)		(76)		(76)
In-process research and development
Acquisition.
Gross Carrying Amount	6,947		6,947
Total finite-lived intangible assets	$ 6,947		$ 6,947
Indefinite-lived intangible assets					$ 6,947
Minimum
Acquisition.
Useful Life (years)			3 years
Maximum
Acquisition.
Useful Life (years)			10 years

Debt - CARES Act (Details) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
Debt - CARES Act (Details) - USD ($) $ in Thousands	Apr. 24, 2020	Jun. 30, 2021	Mar. 31, 2021	Jun. 30, 2021
Debt Instrument [Line Items]
Gain on extinguishment of debt		$ (101)		$ (2,061)
Employee retention credit			$ 300
PPP loan
Debt Instrument [Line Items]
Amount received	$ 1,000
Discount rate (as a percent)	1.00%
Gain on extinguishment of debt			$ 1,000

Debt - Credit agreement (Details) - USD ($) $ in Thousands			3 Months Ended		6 Months Ended
Debt - Credit agreement (Details) - USD ($) $ in Thousands	Jun. 28, 2021	Jan. 19, 2021	Jun. 30, 2021	Mar. 31, 2021	Jun. 30, 2021	Mar. 30, 2021
Short-term Debt [Line Items]
Debt discount				$ 100
Loss on extinguishment of debt, net			$ 101		$ 2,061
Payment of credit agreement					$ 10,500
Credit agreement
Short-term Debt [Line Items]
Additional borrowing amount		$ 1,000
New debt fair value		10,000
Debt discount						$ 500
Loss on extinguishment of debt, net				$ (3,000)
Credit facility bear interest				2.50%
Other Noncash Expense		$ 100
Payment of credit agreement	$ 10,500
Credit agreement \| Series G Warrants
Short-term Debt [Line Items]
Number of shares in exchange of warrant exercise		1,000,000

Leases - Supplemental Information (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021
Operating lease costs	$ 200	$ 100	$ 400	$ 300
Balance Sheet information related to operating leases
Operating lease ROU assets	338		338		$ 266
Operating lease liabilities, current	338		338		279
Total operating lease liabilities	$ 338		338		$ 279
Cash flow information related to operating leases
Cash paid for amounts included in the measurement of operating leases liabilities			$ 386	$ 165
San Clemente Office And Warehouse Space [Member]
Lease renewal term	12 months		12 months
Carlsbad Office And Warehouse Space [Member]
Lease renewal term	3 months		3 months

Leases - Maturities of Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Maturities of operating lease liabilities
Remainder of 2022	$ 174
2023	173
Total lease payments	347
Less: imputed interest	9
Total lease liabilities	$ 338	$ 279
Weighted-average remaining lease term at end of period (in years)	10 months 24 days
Weighted-average discount rate at end of period	5.10%

Acquisition (Details) - Obalon Therapeutics Inc. - USD ($) $ in Millions		3 Months Ended	6 Months Ended
	Jun. 15, 2021	Jun. 30, 2022	Jun. 30, 2022
Acquisitions
Aggregate purchase price	$ 30.6
Issuance of shares of common stock	3,340,035
Shares issued value	$ 30.6
Cancellation of shares	2,680,301
Acquisition related costs		$ 0.0	$ 0.0

Acquisition - Fair value of assets acquired and liabilities assumed (Details) - USD ($) $ in Thousands		6 Months Ended
	Jun. 15, 2021	Jun. 30, 2021
Fair values of the assets acquired and liabilities assumed
Total purchase price, net of cash acquired		$ 25,355
Obalon Therapeutics Inc.
Fair values of the assets acquired and liabilities assumed
Current assets	$ 5,887
Property and equipment, net	796
Right-of-use assets	335
Other assets	1,898
Goodwill	21,566
Developed technology	2,730
Liabilities assumed	(2,650)
Total purchase price	30,562
Less: cash acquired	(5,207)
Total purchase price, net of cash acquired	$ 25,355

Acquisition - Narrative (Details)		3 Months Ended	6 Months Ended
Acquisition - Narrative (Details)	Jun. 15, 2021 USD ($)	Sep. 30, 2021 USD ($) item	Jun. 30, 2022 USD ($)	Jun. 30, 2021 USD ($)	Jun. 16, 2022 USD ($) $ / shares	Jun. 15, 2022 $ / shares	Jul. 15, 2021 USD ($) $ / shares
Acquisition.
Decrease in warrant liability			$ (185,000)	$ (219,000)
Warrant exercise price (in dollars per share) \| $ / shares					$ 0.6665	$ 6.00
Fair value portion of warrants					$ 1,700,000
Risk Free Rate
Acquisition.
Warrant fair value measurement inputs					3.32
Volatility
Acquisition.
Warrant fair value measurement inputs					64.8
Expected dividends
Acquisition.
Warrant fair value measurement inputs					0
Obalon Therapeutics Inc.
Acquisition.
Warrant liability	$ 2,000,000.0	$ 1,300,000
Decrease in warrant liability		$ 700,000
Number of holders exercised fundamental transaction option \| item		1
Fair value portion of warrants							$ 900,000
Reclassification of warrants							$ 500,000
Obalon Therapeutics Inc. \| Minimum
Acquisition.
Warrant exercise price (in dollars per share) \| $ / shares							$ 13.20
Obalon Therapeutics Inc. \| Maximum
Acquisition.
Warrant exercise price (in dollars per share) \| $ / shares							$ 15.00
Obalon Therapeutics Inc. \| Developed technology
Acquisition.
Useful life			15 years
Obalon Therapeutics Inc. \| Discount rate \| Developed technology
Acquisition.
Discount rate			0.220
Obalon Therapeutics Inc. \| Risk Free Rate
Acquisition.
Warrant fair value measurement inputs							0.0044
Obalon Therapeutics Inc. \| Volatility
Acquisition.
Warrant fair value measurement inputs							1.221
Obalon Therapeutics Inc. \| Expected dividends
Acquisition.
Warrant fair value measurement inputs							0

Equity - Issuance of stock and warrants (Details) $ / shares in Units, $ in Thousands						3 Months Ended		6 Months Ended
	Jun. 16, 2022 USD ($) $ / shares shares	Aug. 11, 2021 shares	Jun. 28, 2021 USD ($) $ / shares shares	Jun. 21, 2021 USD ($) individual shares	Jun. 18, 2021 individual shares	Jun. 30, 2022 shares	Jun. 30, 2021 shares	Jun. 30, 2022 USD ($) shares	Jun. 30, 2021 USD ($) shares	Jun. 15, 2022 $ / shares	Jul. 16, 2021 $ / shares shares	Jun. 27, 2021 $ / shares
Equity
Issuance of stock from RSUs (shares)						143,544	0	143,544	909,191
Issuance of common stock upon exercise of warrants, net of transaction costs (in shares)	3,738,642				200,000
Proceeds from warrants exercised \| $								$ 2,489	$ 45,616
Warrant exercise price (in dollars per share) \| $ / shares	$ 0.6665									$ 6.00
Warrants exercise price expressed											95.00%
Payment of credit agreement \| $									$ 10,500
Stock issued (in shares)					100,000
Number of healthcare focused institutional investors \| individual				2	2
Credit agreement
Equity
Payment of credit agreement \| $			$ 10,500
2019 private placement
Equity
Issuance of common stock upon exercise of warrants, net of transaction costs (in shares)				187,674
Proceeds from warrants exercised \| $				$ 100
Stock issued (in shares)				130,445
Restricted Shares
Equity
Common stock issued for professional services (in shares)		37,500
Contract expiration term		6 months
Class Of Warrant Investors Issued June 2022
Equity
Issuance of common stock upon exercise of warrants, net of transaction costs (in shares)	3,700,000
Proceeds from warrants exercised \| $	$ 2,500
June 2021 warrants
Equity
Issuance of common stock upon exercise of warrants, net of transaction costs (in shares)			7,929,384
Proceeds from warrants exercised \| $			$ 45,500
June 2021 warrants \| Credit agreement
Equity
Proceeds to repay \| $			10,800
Payment of credit agreement \| $			10,500
Accrued interest \| $			$ 300
Series E warrants
Equity
Warrant exercise price (in dollars per share) \| $ / shares			$ 6.00									$ 10.64
New Unregistered Warrants
Equity
Issuance of common stock upon exercise of warrants, net of transaction costs (in shares)	900,000		7,100,000
Number of shares in exchange of warrant exercise	3,700,000		5,947,039
Percentage of common stock issued	100.00%		75.00%
Cash purchase price per share \| $ / shares	$ 0.6665		$ 0.09375							$ 6.00
Warrant exercise price (in dollars per share) \| $ / shares			$ 6.00
Exchange Warrants
Equity
Number of shares in exchange of warrant exercise											504,861
Warrant exercise price (in dollars per share) \| $ / shares											$ 4.038
New Warrants
Equity
Warrant exercise price (in dollars per share) \| $ / shares											$ 4.038
Warrants term											5 years
New Warrants \| Maximum
Equity
Number of shares in exchange of warrant exercise											400,000
Common Stock
Equity
Issuance of stock from RSUs (shares)						143,544		909,191
Issuance of common stock upon exercise of warrants, net of transaction costs (in shares)						888,642		888,642
Common Stock \| 2019 private placement
Equity
Stock issued (in shares)				57,229
Warrants to purchase common stock
Equity
Unissued shares held in abeyance (in shares)	2,900,000
Number of unexercised warrants	1,600,000

Warrants (Details)	Jun. 16, 2022 USD ($) $ / shares shares	Jun. 28, 2021 USD ($) Y $ / shares shares	Jun. 18, 2021 shares	Jan. 19, 2021 USD ($) Y shares	Jun. 15, 2022 $ / shares	Jul. 16, 2021 USD ($) Y $ / shares shares	Jun. 27, 2021 $ / shares
Class of Warrant or Right [Line Items]
Exercise price of warrants (in dollars per share) \| $ / shares	$ 0.6665				$ 6.00
Fair value portion of warrants \| $	$ 1,700,000
Issuance of common stock \| shares	3,738,642		200,000
Number of warrants issued \| shares	3,738,642
Risk Free Rate
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs	3.32
Remaining Life
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs \| $	7.5
Expected dividends
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs \| $	0
Volatility
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs	64.8
Series E warrants
Class of Warrant or Right [Line Items]
Exercise price of warrants (in dollars per share) \| $ / shares		$ 6.00					$ 10.64
Series G Warrants
Class of Warrant or Right [Line Items]
Number of warrants issued \| shares				1,000,000
Value of warrants issued \| $				$ 3,000,000.0
Series G Warrants \| Risk Free Rate
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs				0.0045
Series G Warrants \| Remaining Life
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs \| Y				5
Series G Warrants \| Expected dividends
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs				0
Series G Warrants \| Volatility
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs				0.971
Series G Warrants Issued March 25, 2020
Class of Warrant or Right [Line Items]
Exercise price of warrants (in dollars per share) \| $ / shares		6.00					6.56
Series G Warrants Issued December 17, 2020
Class of Warrant or Right [Line Items]
Exercise price of warrants (in dollars per share) \| $ / shares		6.00					6.21
Series G Warrants Issued January 21, 2021
Class of Warrant or Right [Line Items]
Exercise price of warrants (in dollars per share) \| $ / shares		$ 6.00					$ 6.21
June 2021 warrants
Class of Warrant or Right [Line Items]
Issuance of common stock \| shares		7,929,384
New Unregistered Warrants
Class of Warrant or Right [Line Items]
Warrants purchased \| shares	3,700,000	5,947,039
Exercise price of warrants (in dollars per share) \| $ / shares		$ 6.00
Fair value portion of warrants \| $		$ 18,500,000
Issuance of common stock \| shares	900,000	7,100,000
New Unregistered Warrants \| Risk Free Rate
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs		0.00898
New Unregistered Warrants \| Remaining Life
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs \| Y		5
New Unregistered Warrants \| Expected dividends
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs		0
New Unregistered Warrants \| Volatility
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs		0.976
New Warrants
Class of Warrant or Right [Line Items]
Exercise price of warrants (in dollars per share) \| $ / shares						$ 4.038
Warrants term						5 years
Fair value portion of warrants \| $						$ 1,500,000
New Warrants \| Risk Free Rate
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs						0.0079
New Warrants \| Remaining Life
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs \| Y						5
New Warrants \| Expected dividends
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs						0
New Warrants \| Volatility
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs						1.577
New Warrants \| Maximum
Class of Warrant or Right [Line Items]
Warrants purchased \| shares						400,000

Revenue Disaggregation and Operating Segments (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022 USD ($) item	Jun. 30, 2021 USD ($) item	Jun. 30, 2022 USD ($) item	Jun. 30, 2021 USD ($) item
Revenue Recognition
Revenue	$ 2,892	$ 3,529	$ 5,332	$ 6,750
Number of Products in Development Stage \| item	2	2	2	2
United States
Revenue Recognition
Revenue	$ 2,308	$ 2,633	$ 4,152	$ 5,153
Australia
Revenue Recognition
Revenue	188	277	369	570
Europe
Revenue Recognition
Revenue	389	590	803	969
Rest of world
Revenue Recognition
Revenue	7	29	8	58
Obalon Therapeutics Inc.
Revenue Recognition
Revenue			0
ReShape Vest and Diabetes Bloc-Stim Neuromodulation Products
Revenue Recognition
Revenue	$ 0	$ 0	$ 0	$ 0

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 30
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8906-108599

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 40
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9031-108599

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 41
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9038-108599

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (b)
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130545-203045

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-Publisher FASB
-Name Accounting Standards Codification
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-Paragraph 1
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-URI https://asc.fasb.org/extlink&oid=6472922&loc=d3e499488-122856

+ Details

Income Taxes - Income Tax Benefit (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Income Taxes
Effective tax rate differs from statutory tax rate			21.00%
Current:
Income tax benefit	$ 9	$ 28	$ (148)	$ 53

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

Stock-based Compensation - Expense for Stock-Based Awards (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Compensation expense recognized
Stock-based compensation expense	$ 823	$ (364)	$ 1,570	$ (263)
Sales and marketing
Compensation expense recognized
Stock-based compensation expense	152		257
General and administrative expense
Compensation expense recognized
Stock-based compensation expense	550	$ (364)	1,120	$ (263)
Research and development
Compensation expense recognized
Stock-based compensation expense	$ 121		$ 193

Stock-based Compensation - Stock Option Activity (Details) - Stock options $ / shares in Units, $ in Millions	6 Months Ended
	Jun. 30, 2022 USD ($) $ / shares shares
Shares
Shares outstanding, Beginning balance (in shares) \| shares	885,039
Shares, Options granted (in shares) \| shares	560,154
Shares, Options cancelled (in shares) \| shares	(136,862)
Shares outstanding, Ending balance (in shares) \| shares	1,308,331
Shares, Exercisable (in shares) \| shares	617,796
Shares, Vested and expected to vest (in shares) \| shares	1,308,331
Weighted Average Exercise Price
Weighted Average Exercise Price Outstanding, Beginning balance (in dollars per share) \| $ / shares	$ 7.97
Weighted Average Exercise Price, Options granted (in dollars per share) \| $ / shares	1.18
Weighted Average Exercise Price, Options cancelled (in dollars per share) \| $ / shares	2.83
Weighted Average Exercise Price Outstanding, Ending balance (in dollars per share) \| $ / shares	5.60
Weighted Average Exercise Price, Exercisable (in dollars per share) \| $ / shares	9.83
Weighted Average Exercise Price, Vested and expected to vest (in dollars per share) \| $ / shares	$ 5.60
Weighted Average Remaining Contractual Life
Weighted Average Remaining Contractual Life Outstanding	8 years 10 months 24 days
Weighted Average Remaining Contractual Life, Exercisable	8 years 1 month 6 days
Weighted Average Remaining Contractual Life, Vested and expected to vest	8 years 10 months 24 days
Additional disclosures
Unrecognized share-based expenses \| $	$ 1.1
Weighted average period	3 years
Vesting Period	4 years
Option expiration period	10 years

Stock-based Compensation - Restricted Stock Units (Details) - Restricted stock units $ / shares in Units, $ in Millions	6 Months Ended
	Jun. 30, 2022 USD ($) $ / shares shares
Shares
Unvested RSUs, Beginning balance (in shares)	1,711,318
Shares, Granted (in shares)	200,417
Shares, Vested (in shares)	(949,039)
Shares, Cancelled/Forfeited (in shares)	(142,604)
Non-vested RSUs, Ending balance (in shares)	820,092
Weighted Average Grant Date Fair Value
Unvested RSUs, Beginning balance (in dollars per share) \| $ / shares	$ 4.36
Weighted Average Grant Date Fair Value, Granted (in dollars per share) \| $ / shares	1.18
Weighted Average Grant Date Fair Value, Vested (in dollars per share) \| $ / shares	4.36
Weighted Average Grant Date Fair Value, Cancelled/Forfeited (in dollars per share) \| $ / shares	4.36
Non-vested RSUs, Ending balance (in dollars per share) \| $ / shares	$ 3.58
Additional disclosures
Shares, Cancelled	142,604
Vested and undistributed	39,848
Unrecognized compensation costs \| $	$ 2.9
Recognition period	2 years

Commitments and Contingencies (Details) - USD ($) $ in Thousands	Jul. 19, 2022	Aug. 18, 2021	Aug. 06, 2021	Jun. 30, 2022
Contingencies
Amount of claim			$ 1,350
Percentage of gross proceeds received from the exercise of warrants issued pursuant to capital raising engagement agreements sought		8.00%
Litigation
Loss contingency accrual				$ 2,000
H. C. Wainwright and Company \| Subsequent Event
Litigation
Agreed settlement amount	$ 1,000

Subsequent Events (Details) $ in Millions	Jul. 19, 2022 USD ($)
H. C. Wainwright and Company \| Subsequent Event
Subsequent Event [Line Items]
Agreed settlement amount	$ 1.0