0001558370-24-012246 | 10-Q | XBRL Viewer

Equity (Details) $ / shares in Units, $ in Thousands						3 Months Ended		6 Months Ended
Equity (Details) $ / shares in Units, $ in Thousands	Jun. 04, 2024 shares	May 30, 2024 USD ($) shares	Oct. 03, 2023 USD ($)	Apr. 24, 2023 USD ($)	Feb. 08, 2023 USD ($) $ / shares shares	Jun. 30, 2024 shares	Jun. 30, 2023 shares	Jun. 30, 2024 USD ($) shares	Jun. 30, 2023 USD ($) shares
Equity
Exercise of warrants \| $		$ 24						$ 24	$ 12,451
Proceeds from sale and issuance of securities, net \| $								$ 10,200
Common stock warrants with alternative cashless exercise
Equity
Warrants, cashless exercise provision, shares, multiplier					0.50
Exercise of warrants, shares	10,765,000							1,674,376
Aggregate number of shares issued from exercise of warrants								835,313
Public offering
Equity
Number of units issued					1,275,000
Offering price (in dollars per share) \| $ / shares					$ 8.00
Warrant exercise price (in dollars per share) \| $ / shares					$ 8.00
Warrants term					5 years
Gross proceeds from issuance of shares \| $			$ 13,700	$ 13,700	$ 13,700
Public offering \| Pre funded warrants
Equity
Number of warrants for each unit					1
Number of securities called by each warrant					1
Warrant exercise price (in dollars per share) \| $ / shares					$ 0.0001
Public offering \| Public warrants
Equity
Number of warrants for each unit					1
Number of securities called by each warrant					1.5
Public offering \| Common stock warrants with alternative cashless exercise
Equity
Number of securities called by each warrant					0.5
Warrant exercise price (in dollars per share) \| $ / shares					$ 8.00
Over-allotment option
Equity
Exercise of warrants, shares					286,875
Common stock purchased (in shares)					191,250
Number of shares in exchange of warrant exercise					286,875
Common Stock
Equity
Issuance of stock from RSUs (in shares)						72	834	115	1,668
Number of units issued	5,824,958
Aggregate number of shares issued from exercise of warrants		105,000
Common stock purchased (in shares)							291,395		1,476,395
Exercise of warrants (in shares)						5,929,958	511,175	5,929,958	1,436,488
Common Stock \| Public offering
Equity
Number of shares for each unit					1
Common Stock \| Public offering \| Common stock warrants with alternative cashless exercise
Equity
Number of securities called by each warrant					0.75

Subsequent Events

6 Months Ended

Jun. 30, 2024

Subsequent Events

Subsequent Events

(11) Subsequent Events

On July 8, 2024, ReShape, Vyome Therapeutics, Inc., a Delaware corporation (“Vyome”), and Raider Lifesciences Inc., a Delaware corporation, and a direct, wholly owned subsidiary of ReShape (“Merger Sub”), entered into an Agreement and Plan of Merger (the “Merger Agreement”). Pursuant to the Merger Agreement, and subject to the satisfaction or waiver of the conditions specified therein, Merger Sub shall be merged with and into Vyome, with Vyome surviving as a subsidiary of ReShape (the “Merger”).

Simultaneously with the execution of the Merger Agreement, ReShape entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”) with Ninjour Health International Limited, a company incorporated under the laws of the United Kingdom (“Ninjour”), an affiliate of Biorad. Pursuant to the Asset Purchase Agreement, and subject to the satisfaction or waiver of the conditions specified therein, ReShape will sell substantially all of its assets (excluding cash) to Ninjour (or an affiliate thereof), and Ninjour will assume substantially all of ReShape’s liabilities, for a purchase price of $5.16 million in cash, subject to adjustment based on ReShape’s actual accounts receivable and accounts payable at the closing compared to such amounts as of March 31, 2024 (the “Asset Sale”). Ninjour is an affiliate of Biorad Medisys, Pvt. Ltd., which is party to a previously disclosed exclusive license agreement, dated September 19, 2023, with ReShape for ReShape’s Obalon^® Gastric Balloon System.

In connection with the transactions contemplated by the Merger Agreement and Asset Purchase Agreement, ReShape entered into an agreement with a majority of the holders of its outstanding series C convertible preferred stock (the “Series C Preferred Stock”) pursuant to which the holders of the Series C Preferred Stock agreed, subject to and contingent upon the completion of the Merger and the Asset Sale, to reduce the liquidation preference of the Series C Preferred Stock from $26.2 million to the greater of (i) $1 million, (ii) 20% of the purchase price paid for the Asset Sale and (iii) the excess of ReShape’s actual net cash at the effective time of the Merger over the minimum net cash required as a condition to the closing of the Merger as set forth in the Merger Agreement and described below (the “Series C Amendment”). Under the terms of the Series C Amendment, the Series C Preferred Stock would automatically terminate at the effective time of the Merger, except for the right to receive the reduced liquidation preference.

Simultaneously with the execution of the Merger Agreement, ReShape, Vyome, Vyome’s wholly-owned subsidiary Vyome Therapeutics Limited (“Vyome India”) entered into agreements with certain existing accredited investors, pursuant to which the investors have agreed to purchase up to $7.3 million in securities of the Company, Vyome and Vyome India (the “Concurrent Financing”). As part of the Concurrent Financing, certain accredited investors have agreed to purchase up to $5.8 million in shares of common stock of the combined company immediately following completion of the Merger. The price per share for the common stock of the combined company will be calculated as a 30% discount to the agreed upon valuation of the combined company at the closing of the Merger. Simultaneously with the execution of the subscription agreements, Vyome entered into a securities purchase agreement with each investor pursuant to which Vyome issued to each investor a convertible promissory note in the principal amount equal to 5% of such investor’s total agreed upon investment amount, which convertible notes will bear interest at 8% per annum and immediately prior to completion of the Merger will convert into a number of shares of common stock of the combined company equal to 100% of the outstanding principal and interest of the Note divided by the price per share of common stock to be purchased in the financing, as set forth above.

The board of directors of ReShape has unanimously approved the Merger Agreement, the Asset Purchase Agreement, the Series C Amendment, the Concurrent Financing and the transactions contemplated thereby.

Basis of Presentation

6 Months Ended

Jun. 30, 2024

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, 2023, filed on April 1, 2024. 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.

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, 2023, which are included in the Company’s 2023 Annual Report on Form 10-K which was filed with the SEC on April 1, 2024.

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.

Long-Lived Assets

We assess the potential impairment of long-lived assets, principally property and equipment, whenever events or changes in circumstances indicate that the carrying value of the asset group may not be fully recoverable. If an indicator of impairment exists for any of its asset groups, an estimate of undiscounted future cash flows, over the life of the primary asset for each asset group is compared to that long-lived asset group's carrying value. If the carrying value of the asset group is greater than the estimated future undiscounted cash flow, the Company then determines the fair value of the assets, and if an asset is determined to be impaired, the impairment loss is measured by the excess of the carrying amount of the asset over its fair value.

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 6 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,
	2024	2023
Stock options	8,143	17,634
Unvested restricted stock units	604	2,598
Convertible preferred stock	10	10
Warrants	4,726,424	1,632,514

Recent Accounting Pronouncements

New accounting standards not yet adopted are discussed below.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires entities to provide additional information in the rate reconciliation and additional disaggregated disclosures about income taxes paid. This guidance requires public entities to disclose in their rate reconciliation table additional categories of information about federal, state, and foreign income taxes and to provide more details about the reconciling items in some categories if the items meet a quantitative threshold. The guidance is effective for annual periods beginning after December 15, 2024. The Company does not expect the adoption of this guidance to impact its consolidated financial statements, but the guidance will impact its income tax disclosures.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The amendments require disclosure of significant segment expenses and other segment items and requires entities to provide in interim periods all disclosures about a reportable segment’s profit or loss and assets that are currently required annually. The amendment also requires disclosure of the title and position of the chief operating decision maker (“CODM”) and an explanation of how the CODM uses the reported measure(s) of segment profit or loss in assessing segment performance and deciding how to allocate resources. This guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Retrospective application is required, and early adoption is permitted. The Company is currently evaluating the impact the guidance will have on its consolidated financial statements.

Leases - Maturities of Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Maturities of operating lease liabilities
2024 (balance of year)	$ 57
2025	115
2026	59
Total lease payments	231
Less: imputed interest	15
Total lease liabilities	$ 216	$ 262
Weighted-average remaining lease term at end of period (in years)	1 year 10 months 24 days
Weighted-average discount rate at end of period	6.90%

Leases (Tables)

6 Months Ended

Jun. 30, 2024

Leases

Schedule of supplemental information related to operating leases


	June 30,		December 31,
Balance Sheet information	2024		2023
Operating lease ROU assets	$	202	$	250

Operating lease liabilities, current portion	$	113	$	111
Operating lease liabilities, long-term portion		103		151
Total operating lease liabilities	$	216	$	262

Cash flow information for the six months ended June 30,	2024		2023
Cash paid for amounts included in the measurement of operating leases liabilities	$	54	$	228

Schedule of maturities of operating lease liabilities


2024 (balance of year)	$	57
2025		115
2026		59
Total lease payments		231
Less: imputed interest		15
Total lease liabilities	$	216

Weighted-average remaining lease term at end of period (in years)		1.9
Weighted-average discount rate at end of period		6.9	%

Warrants (Tables)

6 Months Ended

Jun. 30, 2024

Schedule of warrant activity





		Shares
Balance December 31, 2023		15,598,392
Issued		—
Exercised		(10,870,000)
Cancelled		(1,968)
Balance June 30, 2024		4,726,424

Schedule of changes in the fair value of warrant liabilities


	Common Stock
	Purchase Warrants
Fair value as of December 31, 2023	$	72
Gain on changes in fair value of liability warrants		(18)
Fair value as of June 30, 2024	$	54

Black-Scholes model

Schedule of Warrant Assumptions Used to Calculate Fair Value


	Cash Exercise		Cashless Exercise
Stock Price	$	5.905	$	5.905
Exercise Price	$	16.00	$	0.00
Term (years)		5.00		5.00
Volatility		96.50%		96.50%
Risk Free Rate		3.784%		3.784%
Dividend Yield		0%		0%

Warrants - Fair Value of Warrant Liabilities (Details) - Common Stock Purchase Warrants $ in Thousands	6 Months Ended
	Jun. 30, 2024 USD ($)
Class of Warrant or Right [Line Items]
Fair value at beginning of period	$ 72
Gain on changes in fair value of liability warrants	(18)
Fair value at end of period	$ 54

Stock-based Compensation - Restricted Stock Units (Details) - Restricted stock units $ / shares in Units, $ in Thousands	6 Months Ended
	Jun. 30, 2024 USD ($) $ / shares shares
Shares
Shares Unvested RSUs, Beginning balance (in shares)	1,417
Shares, Vested (in shares)	(813)
Shares Non-vested RSUs, Ending balance (in shares)	604
Weighted Average Grant Date Fair Value
Weighted Average Grant Date Fair Value, Unvested RSUs, Beginning balance (in dollars per share) \| $ / shares	$ 129.38
Weighted Average Grant Date Fair Value, Vested (in dollars per share) \| $ / shares	165.12
Weighted Average Grant Date Fair Value, Non-vested RSUs, Ending balance (in dollars per share) \| $ / shares	$ 83.98
Additional disclosures
Vested and undistributed	115
Unrecognized compensation costs \| $	$ 48
Recognition period	1 year

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023
Cash flows from operating activities:
Net loss	$ (3,788)	$ (6,155)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense	12	75
Amortization of intangible assets		22
Gain on extinguishment of debt	(429)
Gain on disposal of assets, net		(33)
Stock-based compensation	137	440
Bad debt (recovery) expense	(169)	145
Provision for inventory excess and obsolescence	111	67
Deferred income tax	1	(1)
Gain on changes in fair value of liability warrants	(18)	(3,438)
Offering cost		298
Other noncash items	2	12
Change in operating assets and liabilities:
Accounts and other receivables	447	60
Inventory	384	276
Prepaid expenses and other current assets	31	(470)
Accounts payable and accrued liabilities	(150)	(2,833)
Warranty liability		(177)
Other		(11)
Net cash used in operating activities	(3,429)	(11,723)
Cash flows from investing activities:
Capital expenditures		(43)
Proceeds from sale of capital assets		33
Cash used in investing activities:		(10)
Cash flows from financing activities:
Exercise of warrants	24	12,451
Net cash provided by financing activities	24	12,451
Effect of currency exchange rate changes on cash and cash equivalents	(1)	(6)
Net change in cash, cash equivalents and restricted cash	(3,406)	712
Cash, cash equivalents and restricted cash at beginning of period	4,559	3,955
Cash, cash equivalents and restricted cash at end of period	1,153	$ 4,667
Supplemental disclosure:
Cash paid for income taxes	$ 12

Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2024	Jun. 30, 2024	Dec. 31, 2023
Inventory Disclosure
Raw materials	$ 872	$ 872	$ 1,020
Sub-assemblies	1,219	1,219	1,379
Finished goods	1,155	1,155	1,342
Total inventory	3,246	3,246	3,741
Prepaid expenses and other current assets:
Prepaid insurance	149	149	110
Professional services	45	45
Patents	7	7	13
Prepaid advertising and marketing	35	35	41
Taxes	15	15	47
Other current assets	55	55	126
Total prepaid expenses and other current assets	306	306	337
Accrued and other liabilities:
Payroll and benefits	636	636	701
Accrued legal settlements			200
Customer deposits	723	723	639
Taxes	58	58	61
Accrued professional	431	431	155
Other liabilities	47	47	58
Total accrued and other liabilities	1,895	1,895	$ 1,814
Gain on extinguishment of debt	429	$ 429
Accounts payable
Accrued and other liabilities:
Write-off of the payables	$ 429

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
Income Taxes (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Income Taxes
Income tax expense	$ 15	$ 4	$ 28	$ 18
U.S. federal income tax rate (as a percent)			21.00%

- Definition

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

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 270
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (i)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482964/270-10-50-1

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 32
-Subparagraph (ee)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-32

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-12

Reference 4: http://www.xbrl.org/2003/role/exampleRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 55
-Paragraph 231
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482663/740-10-55-231

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 9
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483443/250-10-50-9

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SAB Topic 6.I.7)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479360/740-10-S99-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 8
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483443/250-10-50-8

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 10
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-10

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 22
-Subparagraph (h)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-22

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 944
-SubTopic 220
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.7-04(9))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147477250/944-220-S99-1

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Name Accounting Standards Codification
-Section 45
-Paragraph 2
-Subparagraph (a)
-SubTopic 20
-Topic 740
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482659/740-20-45-2

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h))
-SubTopic 10
-Topic 235
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480678/235-10-S99-1

+ Details

Document and Entity Information - shares	6 Months Ended
Document and Entity Information - shares	Jun. 30, 2024	Aug. 12, 2024
Document and Entity Information
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2024
Document Transition Report	false
Securities Act 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	18 Technology Dr, Suite 110
Entity Address, City or Town	Irvine
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	92618
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		29,387,152
Entity Central Index Key	0001427570
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q2
Amendment Flag	false

Condensed Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Income Statement [Abstract]
Revenue	$ 1,965	$ 2,254	$ 3,909	$ 4,541
Cost of revenue	831	1,060	1,610	2,123
Gross profit	1,134	1,194	2,299	2,418
Operating expenses:
Sales and marketing	670	2,177	1,689	4,359
General and administrative	2,119	2,445	3,991	6,667
Research and development	399	581	883	1,033
Gain on disposal of assets, net		(33)		(33)
Total operating expenses	3,188	5,170	6,563	12,026
Operating loss	(2,054)	(3,976)	(4,264)	(9,608)
Other expense (income), net:
Interest income, net	(4)	(9)	(13)	(4)
Gain on changes in fair value of liability warrants	2	(472)	(18)	(3,438)
Gain on extinguishment of debt	(429)		(429)
Loss (gain) on foreign currency exchange, net	16		40	(21)
Other	(59)	(6)	(84)	(8)
Loss before income tax provision	(1,580)	(3,489)	(3,760)	(6,137)
Income tax expense	15	4	28	18
Net loss	$ (1,595)	$ (3,493)	$ (3,788)	$ (6,155)
Net loss per share - basic and diluted:
Net loss per share - basic (in dollars per share)	$ (0.06)	$ (1.08)	$ (0.16)	$ (2.48)
Net loss per share - diluted (in dollars per share)	$ (0.06)	$ (1.08)	$ (0.16)	$ (2.48)
Shares used to compute basic net loss per share (in shares)	25,222,443	3,249,259	24,339,785	2,482,957
Shares used to compute diluted net loss per share (in shares)	25,222,443	3,249,259	24,339,785	2,482,957

Supplemental Balance Sheet Information

6 Months Ended

Jun. 30, 2024

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,
	2024		2023
Raw materials	$	872	$	1,020
Sub-assemblies		1,219		1,379
Finished goods		1,155		1,342
Total inventory	$	3,246	$	3,741

Prepaid expenses and other current assets:


	June 30,		December 31,
	2024		2023
Prepaid insurance	$	149	$	110
Professional services		45		—
Patents		7		13
Prepaid advertising and marketing		35		41
Taxes		15		47
Other current assets		55		126
Total prepaid expenses and other current assets	$	306	$	337

Accrued and other liabilities:


	June 30,		December 31,
	2024		2023
Payroll and benefits	$	636	$	701
Accrued legal settlements		—		200
Customer deposits		723		639
Taxes		58		61
Accrued professional		431		155
Other liabilities		47		58
Total accrued and other liabilities	$	1,895	$	1,814

Accounts payable:

During the second quarter of 2024, management requested our outside legal counsel to provide guidance with respect to vendor collectability of various accounts payables carried on the books from 2020 and prior. Based on the review of the statute of limitations for the various states, these vendors were located, and legal counsel provided a conclusion if the laws per the respective states if the statute of limitations has expired. The statute of limitations is an affirmative defense in which the defendant introduces evidence, which, if found to be credible, will negate criminal or civil liability, even if it is proven the defendant committed the alleged acts. The party raising the affirmative defense has the burden of proof on establishing that it applies. In a civil action in which a creditor demands payment on a written instrument evidencing a debt, the successful assertion of the statute of limitations defense will bar collection of the debt. In order to assert the statute of limitations as a defense, a defendant must specifically assert the defense is the answer. If a defendant fails to specifically plead the defense, it will be deemed to be waived. Since no action to enforce such liabilities was brought before June 30, 2024, it is our opinion that the liability is time-barred from collection under the respective state laws and should be removed from the Company’s balance sheet.

Therefore, the Company made the decision to write-off the payables totaling $429 thousand. As of June 30, 2024, the write-off of the $429 thousand resulted in a gain on extinguishment of debt which was reported on the Statement of Operations for the three and six months ended June 30, 2024.

Supplemental Balance Sheet Information (Tables)

6 Months Ended

Jun. 30, 2024

Supplemental Balance Sheet Information

Schedule of components of inventory


	June 30,		December 31,
	2024		2023
Raw materials	$	872	$	1,020
Sub-assemblies		1,219		1,379
Finished goods		1,155		1,342
Total inventory	$	3,246	$	3,741

Schedule of components of prepaid expenses and other current assets


	June 30,		December 31,
	2024		2023
Prepaid insurance	$	149	$	110
Professional services		45		—
Patents		7		13
Prepaid advertising and marketing		35		41
Taxes		15		47
Other current assets		55		126
Total prepaid expenses and other current assets	$	306	$	337

Schedule of components of accrued and other liabilities


	June 30,		December 31,
	2024		2023
Payroll and benefits	$	636	$	701
Accrued legal settlements		—		200
Customer deposits		723		639
Taxes		58		61
Accrued professional		431		155
Other liabilities		47		58
Total accrued and other liabilities	$	1,895	$	1,814

Liquidity and Management's Plans (Details) - USD ($) $ in Thousands	Oct. 03, 2023	Apr. 24, 2023	Feb. 08, 2023	Jun. 30, 2024	Dec. 31, 2023	Jun. 30, 2023	Dec. 31, 2022
Liquidity and Management Plans
Net working capital				$ 2,900
Cash and cash equivalents and restricted cash				1,153	$ 4,559	$ 4,667	$ 3,955
Accounts receivable				$ 1,400
Public offering
Liquidity and Management Plans
Gross proceeds from issuance of shares	$ 13,700	$ 13,700	$ 13,700

Subsequent Events (Details) - Subsequent Event $ in Thousands	Jul. 08, 2024 USD ($)
Subsequent Events
Preferred Stock, Liquidation Preference, Value	$ 26,200
Sale Of Stock By Vyome Therapeutics
Subsequent Events
Purchase price of shares investor commitment	7,300
Merger Agreement
Subsequent Events
Preferred Stock, Liquidation Preference, Value	$ 1,000
Liquidation value, as percentage of asset purchase price	20.00%
Purchase price of shares investor commitment	$ 5,800
Common stock price, discount percentage	30.00%
Principal amount of each investor's convertible promissory note as a percentage of their individual investment amount	5.00%
Interest rate per annum	8.00%
Percentage of debt carrying value converted into common stock	100.00%
Asset Purchase Agreement \| Forecast
Subsequent Events
Cash purchase price	$ 5,160

Warrants - Warrant activity (Details)	6 Months Ended
Warrants - Warrant activity (Details)	Jun. 30, 2024 shares
Warrants
Balance at beginning of period (in shares)	15,598,392
Exercised (in shares)	(10,870,000)
Cancelled (in shares)	(1,968)
Balance at end of period (in shares)	4,726,424

Revenue Disaggregation and Operating Segments (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Revenue Recognition
Total revenue	$ 1,965	$ 2,254	$ 3,909	$ 4,541
United States
Revenue Recognition
Total revenue	1,663	1,929	3,281	3,742
Australia
Revenue Recognition
Total revenue	103	123	205	280
Europe
Revenue Recognition
Total revenue	198	193	396	497
Rest of World
Revenue Recognition
Total revenue	1	9	27	22
DBSN Device
Revenue Recognition
Total revenue	0	0	0	0
Obalon Balloon system
Revenue Recognition
Total revenue	$ 0	$ 0	$ 0	$ 0

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References + Details

- 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
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 41
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-41

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 270
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (i)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482964/270-10-50-1

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 32
-Subparagraph (ee)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-32

Reference 4: http://fasb.org/us-gaap/role/ref/otherTransitionRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 32
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-32

Reference 5: http://fasb.org/us-gaap/role/ref/otherTransitionRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 32
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-32

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 924
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SAB Topic 11.L)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479941/924-10-S99-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 5
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-5

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 30
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-30

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 42
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-42

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 22
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-22

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 40
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-40

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 22
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-22

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 4
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-4

+ Details

Warrants

6 Months Ended

Jun. 30, 2024

Warrants

Warrants

(6) Warrants

The Company’s grants of warrants to purchase common stock are primarily in connection with equity financing. See Note 5 for additional information about equity financings and the related issuance of warrants. Warrant activity for the six months ended June 30, 2024 is as follows:





		Shares
Balance December 31, 2023		15,598,392
Issued		—
Exercised		(10,870,000)
Cancelled		(1,968)
Balance June 30, 2024		4,726,424

On February 8, 2023, the Company completed a public offering in which three classes of warrants were issued. There were 2,199,375 common stock purchase warrants issued with an alternative cashless exercise provision. The alternative cashless exercise allows the holder to exercise one warrant share for 0.5 shares of common stock or exercise via the cash exercise price of $8.00 per share of common stock per warrant. The Company classifies these warrants as a liability, and the Company utilized a bifurcated Black-Scholes option pricing model to consider the cash exercise option and cashless exercise option. The bifurcated Black-Scholes option pricing model used an exercise price where the two exercise methods would be indifferent with market inputs of the stock price on the issuance, risk free interest rate, expected share price volatility and dividend yield. The Company calculates the fair value of the warrants at each reporting period and when a warrant is exercised, with the changes in fair value recognized in the statement of operations.

Below is a summary of the initial inputs used in the bifurcated Black-Scholes option pricing model.


	Cash Exercise		Cashless Exercise
Stock Price	$	5.905	$	5.905
Exercise Price	$	16.00	$	0.00
Term (years)		5.00		5.00
Volatility		96.50%		96.50%
Risk Free Rate		3.784%		3.784%
Dividend Yield		0%		0%

The following table presents the changes in the fair value of warrant liabilities:


	Common Stock
	Purchase Warrants
Fair value as of December 31, 2023	$	72
Gain on changes in fair value of liability warrants		(18)
Fair value as of June 30, 2024	$	54

In addition, one of the investors purchased 90,000 pre-funded warrants at a price of $7.999 per warrant. These warrants have an exercise price of $0.0001 per share and do not expire. The pre-funded warrants were valued at $0.5 million using the fair value approach at the time of issuance. The fair value of the pre-funded warrants was determined using a Black Scholes option pricing model using a risk-free rate of 3.784%, an expected term of 5.0 years, expected dividends of zero and expected volatility of 96.5%.

As part of the terms of the offering, the Company issued 73,313 representative’s warrants with an exercise price of $8.80 per share and expiration date on February 3, 2028. The representative’s warrants were valued at $0.3 million using the fair value approach at the time of issuance. The fair value of the representative’s warrants was determined using a Black Scholes option pricing model using a risk-free rate of 3.786%, an expected term of 4.99 years, expected dividends of zero and expected volatility of 96.5%.

Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands	Preferred Stock	Common Stock	Additional Paid-in Capital	Accumulated Deficit	Accumulated Other Comprehensive Income (Loss)	Total
Balance at Dec. 31, 2022		$ 1	$ 627,935	$ (624,187)	$ (88)	$ 3,661
Balance (in shares) at Dec. 31, 2022	95,388	519,219
Changes in Stockholders' (Deficit) Equity
Net loss				(6,155)		(6,155)
Other comprehensive income, net of tax					(7)	(7)
Issuance of common stock pursuant to reverse stock split (in shares)		18,399
Stock compensation			440			440
Common stock purchased		$ 1	894			895
Common stock purchased (in shares)		1,476,395
Equity issuance costs			91			91
Issuance of stock from RSUs (in shares)		1,668
Exercise of warrants		$ 1	7,812			7,813
Exercise of warrants (in shares)		1,436,488
Balance at Jun. 30, 2023		$ 3	637,172	(630,342)	(95)	6,738
Balance (in shares) at Jun. 30, 2023	95,388	3,452,169
Balance at Mar. 31, 2023		$ 3	634,697	(626,849)	(93)	7,758
Balance (in shares) at Mar. 31, 2023	95,388	2,648,765
Changes in Stockholders' (Deficit) Equity
Net loss				(3,493)		(3,493)
Other comprehensive income, net of tax					(2)	(2)
Stock compensation			217			217
Common stock purchased			894			894
Common stock purchased (in shares)		291,395
Equity issuance costs			(207)			(207)
Issuance of stock from RSUs (in shares)		834
Exercise of warrants			1,571			1,571
Exercise of warrants (in shares)		511,175
Balance at Jun. 30, 2023		$ 3	637,172	(630,342)	(95)	6,738
Balance (in shares) at Jun. 30, 2023	95,388	3,452,169
Balance at Dec. 31, 2023		$ 23	642,302	(635,574)	(88)	6,663
Balance (in shares) at Dec. 31, 2023	95,388	23,457,047
Changes in Stockholders' (Deficit) Equity
Net loss				(3,788)		(3,788)
Other comprehensive income, net of tax					(1)	(1)
Stock compensation			137			137
Issuance of stock from RSUs (in shares)		115
Exercise of warrants		$ 6	18			24
Exercise of warrants (in shares)		5,929,958
Balance at Jun. 30, 2024		$ 29	642,457	(639,362)	(89)	3,035
Balance (in shares) at Jun. 30, 2024	95,388	29,387,120
Balance at Mar. 31, 2024		$ 23	642,374	(637,767)	(96)	4,534
Balance (in shares) at Mar. 31, 2024	95,388	23,457,090
Changes in Stockholders' (Deficit) Equity
Net loss				(1,595)		(1,595)
Other comprehensive income, net of tax					7	7
Stock compensation			65			65
Issuance of stock from RSUs (in shares)		72
Exercise of warrants		$ 6	18			24
Exercise of warrants (in shares)		5,929,958
Balance at Jun. 30, 2024		$ 29	$ 642,457	$ (639,362)	$ (89)	$ 3,035
Balance (in shares) at Jun. 30, 2024	95,388	29,387,120

Warrants (Details) - Public offering $ / shares in Units, $ in Millions	Feb. 08, 2023 USD ($) Y item $ / shares shares
Warrants
Number of classes of warrants issued \| item	3
Exercise price of warrants (in dollars per share) \| $ / shares	$ 8.00
Common stock warrants with alternative cashless exercise
Warrants
Number of warrants issued \| shares	2,199,375
Number of securities called by each warrant \| shares	0.5
Exercise price of warrants (in dollars per share) \| $ / shares	$ 8.00
Pre funded warrants
Warrants
Number of investors \| item	1
Number of warrants issued \| shares	90,000
Price per warrant \| $ / shares	$ 7.999
Number of securities called by each warrant \| shares	1
Exercise price of warrants (in dollars per share) \| $ / shares	$ 0.0001
Fair value portion of warrants \| $	$ 0.5
Pre funded warrants \| Measurement Input, Risk Free Interest Rate [Member]
Warrants
Warrant fair value measurement inputs	0.03784
Pre funded warrants \| Measurement Input, Expected Term [Member]
Warrants
Warrant fair value measurement inputs \| Y	5.0
Pre funded warrants \| Measurement Input, Expected Dividend Rate [Member]
Warrants
Warrant fair value measurement inputs	0
Pre funded warrants \| Measurement Input, Price Volatility [Member]
Warrants
Warrant fair value measurement inputs	0.965
Representative's warrants
Warrants
Number of warrants issued \| shares	73,313
Exercise price of warrants (in dollars per share) \| $ / shares	$ 8.80
Fair value portion of warrants \| $	$ 0.3
Representative's warrants \| Measurement Input, Risk Free Interest Rate [Member]
Warrants
Warrant fair value measurement inputs	0.03786
Representative's warrants \| Measurement Input, Expected Term [Member]
Warrants
Warrant fair value measurement inputs \| Y	4.99
Representative's warrants \| Measurement Input, Expected Dividend Rate [Member]
Warrants
Warrant fair value measurement inputs	0
Representative's warrants \| Measurement Input, Price Volatility [Member]
Warrants
Warrant fair value measurement inputs	0.965

Revenue Disaggregation and Operating Segments (Tables)

6 Months Ended

Jun. 30, 2024

Revenue Disaggregation and Operating Segments

Schedule of revenue disaggregated by geography


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2024		2023		2024		2023
United States	$	1,663	$	1,929	$	3,281	$	3,742
Australia		103		123		205		280
Europe		198		193		396		497
Rest of World		1		9		27		22
Total revenue	$	1,965	$	2,254	$	3,909	$	4,541

Basis of Presentation (Tables)

6 Months Ended

Jun. 30, 2024

Basis of Presentation

Schedule of anti-dilutive securities


	June 30,
	2024	2023
Stock options	8,143	17,634
Unvested restricted stock units	604	2,598
Convertible preferred stock	10	10
Warrants	4,726,424	1,632,514

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Pay vs Performance Disclosure
Net Income (Loss)	$ (1,595)	$ (3,493)	$ (3,788)	$ (6,155)

- Definition

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

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483443/250-10-50-6

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 9
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483443/250-10-50-9

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 805
-SubTopic 60
-Name Accounting Standards Codification
-Section 65
-Paragraph 1
-Subparagraph (g)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147476176/805-60-65-1

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 323
-Name Accounting Standards Codification
-Section 65
-Paragraph 2
-Subparagraph (g)(3)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147478666/740-323-65-2

Reference 5: http://fasb.org/us-gaap/role/ref/legacyRef
-Topic 220
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 2
-Subparagraph (SX 210.5-03(20))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483621/220-10-S99-2

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(g)(1)(ii))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480678/235-10-S99-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 323
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481687/323-10-50-3

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 825
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 28
-Subparagraph (f)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482907/825-10-50-28

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 220
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482765/220-10-50-6

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483443/250-10-50-3

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (b)(2)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483443/250-10-50-1

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 815
-SubTopic 40
-Name Accounting Standards Codification
-Section 65
-Paragraph 1
-Subparagraph (f)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480175/815-40-65-1

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 8
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483443/250-10-50-8

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 11
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483443/250-10-50-11

Reference 15: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 11
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483443/250-10-50-11

Reference 16: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 4
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483443/250-10-50-4

Reference 17: http://www.xbrl.org/2003/role/exampleRef
-Topic 946
-SubTopic 830
-Name Accounting Standards Codification
-Section 55
-Paragraph 10
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479168/946-830-55-10

Reference 18: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 220
-Name Accounting Standards Codification
-Section 45
-Paragraph 7
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479105/946-220-45-7

Reference 19: http://www.xbrl.org/2003/role/disclosureRef
-Topic 944
-SubTopic 220
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.7-04(18))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147477250/944-220-S99-1

Reference 20: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 220
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.6-07(9))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479134/946-220-S99-1

Reference 21: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 220
-Name Accounting Standards Codification
-Section S99
-Paragraph 3
-Subparagraph (SX 210.6-09(1)(d))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479134/946-220-S99-3

Reference 22: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(i))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480097/470-10-S99-1A

Reference 23: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(ii))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480097/470-10-S99-1A

Reference 24: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(iii)(A))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480097/470-10-S99-1A

Reference 25: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(iv))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480097/470-10-S99-1A

Reference 26: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(5))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480097/470-10-S99-1A

Reference 27: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(i))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480097/470-10-S99-1B

Reference 28: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iii)(A))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480097/470-10-S99-1B

Reference 29: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iii)(B))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480097/470-10-S99-1B

Reference 30: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iv))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480097/470-10-S99-1B

Reference 31: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(5))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480097/470-10-S99-1B

Reference 32: http://www.xbrl.org/2003/role/disclosureRef
-Topic 260
-SubTopic 10
-Name Accounting Standards Codification
-Section 45
-Paragraph 60B
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482689/260-10-45-60B

Reference 33: http://www.xbrl.org/2003/role/disclosureRef
-Topic 205
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 7
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483499/205-20-50-7

Reference 34: http://fasb.org/us-gaap/role/ref/legacyRef
-Topic 230
-SubTopic 10
-Name Accounting Standards Codification
-Section 45
-Paragraph 28
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482740/230-10-45-28

Reference 35: http://www.xbrl.org/2003/role/disclosureRef
-Topic 220
-SubTopic 10
-Name Accounting Standards Codification
-Section 45
-Paragraph 1A
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482790/220-10-45-1A

Reference 36: http://www.xbrl.org/2003/role/disclosureRef
-Topic 220
-SubTopic 10
-Name Accounting Standards Codification
-Section 45
-Paragraph 1B
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482790/220-10-45-1B

Reference 37: http://fasb.org/us-gaap/role/ref/legacyRef
-Topic 942
-SubTopic 220
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.9-04(22))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147478524/942-220-S99-1

+ Details

Leases

6 Months Ended

Jun. 30, 2024

Leases

Leases

(4) Leases

The Company had a noncancelable operating lease for office and warehouse space in San Clemente, which expired June 30, 2023. On March 13, 2023, the Company entered into a lease for approximately 5,038 square feet of office and warehouse space at 18 Technology Drive, Suite 110, Irvine, California 92618 and relocated its principal executive offices from our former San Clemente, California location to the Irvine, California location. The Irvine lease has a term of 36 months, commencing on May 1, 2023.

The Company does not have any short-term leases or financing lease arrangements. Lease and non-lease components are accounted for separately.

Operating lease costs were $0.1 million for both the three months ended June 30, 2024 and 2023, and $0.1 million and $0.2 million for the six months ended June 30, 2024 and 2023, respectively. Variable lease costs were not material.

Supplemental information related to operating leases is as follows:


	June 30,		December 31,
Balance Sheet information	2024		2023
Operating lease ROU assets	$	202	$	250

Operating lease liabilities, current portion	$	113	$	111
Operating lease liabilities, long-term portion		103		151
Total operating lease liabilities	$	216	$	262

Cash flow information for the six months ended June 30,	2024		2023
Cash paid for amounts included in the measurement of operating leases liabilities	$	54	$	228

Maturities of operating lease liabilities were as follows as of June 30, 2024:


2024 (balance of year)	$	57
2025		115
2026		59
Total lease payments		231
Less: imputed interest		15
Total lease liabilities	$	216

Weighted-average remaining lease term at end of period (in years)		1.9
Weighted-average discount rate at end of period		6.9	%

Stock-based Compensation (Tables)

6 Months Ended

Jun. 30, 2024

Stock-based Compensation

Schedule of stock-based compensation expense


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2024		2023		2024		2023
Sales and marketing	$	4	$	30	$	15	$	60
General and administrative		26		128		51		256
Research and development		35		59		71		124
Total stock-based compensation expense	$	65	$	217	$	137	$	440

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, 2023	15,218	$	377.75		$	—
Options granted	—		—
Options exercised	—		—
Options cancelled	(6,069)		131.55
Outstanding at June 30, 2024	9,149	$	541.06	6.9	$	—
Exercisable at June 30, 2024	8,143	$	600.62	6.7	$	—
Vested and expected to vest at June 30, 2024	9,149	$	541.06	6.9	$	—

Summary of unvested RSUs award activity


		Weighted
		Average
		Grant Date
	Shares	Fair Value
Unvested RSUs at December 31, 2023	1,417	$	129.38
Granted	—		—
Vested ⁽¹⁾	(813)	$	165.12
Cancelled/Forfeited	—		—
Non-vested RSUs at June 30, 2024	604	$	83.98

(1)	At June 30, 2024, there were 115 shares of common stock related to RSU awards that had vested and the shares were not distributed to the participants.

Basis of Presentation (Details) - shares	6 Months Ended
Basis of Presentation (Details) - shares	Jun. 30, 2024	Jun. 30, 2023
Employee Stock Option
Anti-dilutive securities
Anti-dilutive securities (in shares)	8,143	17,634
Restricted stock units
Anti-dilutive securities
Anti-dilutive securities (in shares)	604	2,598
Convertible preferred stock
Anti-dilutive securities
Anti-dilutive securities (in shares)	10	10
Warrants
Anti-dilutive securities
Anti-dilutive securities (in shares)	4,726,424	1,632,514

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Allowance for doubtful accounts	$ 636	$ 804
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized	300,000,000	300,000,000
Common stock, shares issued	29,387,120	23,457,047
Common stock, shares outstanding	29,387,120	23,457,047
Series C convertible preferred stock
Preferred stock, authorized	10,000,000	10,000,000
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

Stock-based Compensation - Stock Option Activity (Details) - Employee Stock Option $ / shares in Units, $ in Thousands	6 Months Ended
	Jun. 30, 2024 USD ($) $ / shares shares
Shares
Shares outstanding, Beginning balance (in shares) \| shares	15,218
Shares, Options cancelled (in shares) \| shares	(6,069)
Shares outstanding, Ending balance (in shares) \| shares	9,149
Shares, Exercisable (in shares) \| shares	8,143
Shares, Vested and expected to vest (in shares) \| shares	9,149
Weighted Average Exercise Price Per Share
Weighted Average Exercise Price Per Share, Outstanding, Beginning balance (in dollars per share) \| $ / shares	$ 377.75
Weighted Average Exercise Price Per Share, Options cancelled (in dollars per share) \| $ / shares	131.55
Weighted Average Exercise Price Per Share, Outstanding, Ending balance (in dollars per share) \| $ / shares	541.06
Weighted Average Exercise Price Per Share, Exercisable (in dollars per share) \| $ / shares	600.62
Weighted Average Exercise Price Per Share, Vested and expected to vest (in dollars per share) \| $ / shares	$ 541.06
Weighted Average Remaining Contractual Life
Weighted Average Remaining Contractual Life Outstanding	6 years 10 months 24 days
Weighted Average Remaining Contractual Life, Exercisable	6 years 8 months 12 days
Weighted Average Remaining Contractual Life, Vested and expected to vest	6 years 10 months 24 days
Aggregate Intrinsic Value
Aggregate Intrinsic Value Outstanding (in dollars) \| $	$ 0
Additional disclosures
Unrecognized share-based expenses \| $	$ 42
Weighted average recognition period	1 year 3 months 18 days
Vesting period	4 years
Option expiration period	10 years

Leases - Supplemental Information (Details) $ in Thousands	3 Months Ended		6 Months Ended
Leases - Supplemental Information (Details) $ in Thousands	Jun. 30, 2024 USD ($)	Jun. 30, 2023 USD ($)	Jun. 30, 2024 USD ($)	Jun. 30, 2023 USD ($)	Dec. 31, 2023 USD ($)	Mar. 13, 2023 ft²
Leases
Operating lease costs	$ 100	$ 100	$ 100	$ 200
Balance Sheet information related to operating leases
Operating lease ROU assets	202		202		$ 250
Operating lease liabilities, current portion	113		113		111
Operating lease liabilities, long-term portion	103		103		151
Total operating lease liabilities	$ 216		216		$ 262
Cash flow information related to operating leases
Cash paid for amounts included in the measurement of operating leases liabilities			$ 54	$ 228
Office and warehouse space in Irvine
Leases
Area of land \| ft²						5,038
Lease term						36 months

Warrants - Black-Scholes Option Pricing Model (Details)	Jun. 30, 2024 shares	Dec. 31, 2023 shares	Feb. 08, 2023 $ / shares Y
Class of Warrant or Right [Line Items]
Warrants (in shares) \| shares	4,726,424	15,598,392
Stock Price \| Cash exercise \| Black-Scholes model
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs			5.905
Stock Price \| Cashless exercise \| Black-Scholes model
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs			5.905
Exercise Price \| Cash exercise \| Black-Scholes model
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs			16.00
Exercise Price \| Cashless exercise \| Black-Scholes model
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs			0.00
Term (years) \| Cash exercise \| Black-Scholes model
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs \| Y			5.00
Term (years) \| Cashless exercise \| Black-Scholes model
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs \| Y			5.00
Volatility \| Cash exercise \| Black-Scholes model
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs			0.9650
Volatility \| Cashless exercise \| Black-Scholes model
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs			0.9650
Risk Free Rate \| Cash exercise \| Black-Scholes model
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs			0.03784
Risk Free Rate \| Cashless exercise \| Black-Scholes model
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs			0.03784
Dividend Yield \| Cash exercise \| Black-Scholes model
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs			0
Dividend Yield \| Cashless exercise \| Black-Scholes model
Class of Warrant or Right [Line Items]
Warrant fair value measurement inputs			0

Liquidity and Management's Plans

6 Months Ended

Jun. 30, 2024

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 as the Company has modified its strategy to a metrics-driven approach through a sustainable and scalable business model, via a digital lead generation and re-engagement strategy. As of June 30, 2024, the Company had net working capital of approximately $2.9 million, primarily due to cash and cash equivalents and restricted cash of $1.2 million, and $1.4 million of net accounts receivable. The Company has raised gross proceeds of $13.7 million between the public offerings that occurred on February 8, 2023, April 24, 2023 and October 3, 2023. Based on its available cash resources, the Company will 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’s anticipated operations include plans to (i) merge with Vyome Therapeutics, Inc and sell certain assets to Biorad, which will continue the operations, for further details see Note 11, (ii) grow sales and operations of the Company with the Lap-Band product line both domestically and internationally as well as to obtain cost savings synergies, (iii) introduce to the market Lap-Band 2.0 FLEX, (iv) continue development of the Diabetes Bloc-Stim Neuromodulation (“DBSN”) device, and (v) prior to such merger, explore and capitalize on synergistic opportunities to expand our portfolio and offer future minimally invasive treatments and therapies in the obesity continuum of care. The Company believes that it has the flexibility to manage the growth of its expenditures and operations depending on the amount of available cash flows, which could include reducing expenditures for marketing and product development activities. If management’s plans do not develop, and the Company does not raise additional cash, at the current burn rate, management expects to run out of cash during the third quarter of 2024.

There can be no assurance as to whether the Company will close the planned transactions or whether additional financing will be available on terms acceptable to the Company, if at all. If sufficient funds on acceptable terms are not available when needed, it would have a negative impact on the Company’s financial condition and could force the Company to delay, limit, reduce, or terminate product development or future commercialization efforts or grant rights to develop and market product candidates or testing products that the Company would otherwise plan to develop.

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.

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Jun. 30, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

Basis of Presentation (Policies)

6 Months Ended

Jun. 30, 2024

Basis of Presentation

Basis of Presentation

(1) Basis of Presentation

Use of Estimates

Long-Lived Assets

Fair Value of Financial Instruments

Net Loss Per Share


	June 30,
	2024	2023
Stock options	8,143	17,634
Unvested restricted stock units	604	2,598
Convertible preferred stock	10	10
Warrants	4,726,424	1,632,514

Recent Accounting Pronouncements

New accounting standards not yet adopted are discussed below.

Stock-based Compensation

6 Months Ended

Jun. 30, 2024

Stock-based Compensation

Stock-based Compensation

(9) Stock-based Compensation

Stock-based compensation expense related to stock options and RSUs issued under the ReShape Lifesciences Inc. 2022 Stock Incentive Plan (the “Plan”) for the three months and six months ended June 30, 2024 and 2023 were as follows:


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2024		2023		2024		2023
Sales and marketing	$	4	$	30	$	15	$	60
General and administrative		26		128		51		256
Research and development		35		59		71		124
Total stock-based compensation expense	$	65	$	217	$	137	$	440

Stock Options

A summary of the status of the Company’s stock options as of June 30, 2024, and changes during the six months ended June 30, 2024, 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, 2023	15,218	$	377.75		$	—
Options granted	—		—
Options exercised	—		—
Options cancelled	(6,069)		131.55
Outstanding at June 30, 2024	9,149	$	541.06	6.9	$	—
Exercisable at June 30, 2024	8,143	$	600.62	6.7	$	—
Vested and expected to vest at June 30, 2024	9,149	$	541.06	6.9	$	—

There was no intrinsic value to outstanding stock options at June 30, 2024. The unrecognized share-based expense at June 30, 2024 was $42 thousand and will be recognized over a weighted average period of 1.3 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

A summary of the Company’s unvested RSUs award activity for the three months ended June 30, 2024, is as follows:


		Weighted
		Average
		Grant Date
	Shares	Fair Value
Unvested RSUs at December 31, 2023	1,417	$	129.38
Granted	—		—
Vested ⁽¹⁾	(813)	$	165.12
Cancelled/Forfeited	—		—
Non-vested RSUs at June 30, 2024	604	$	83.98

(1)	At June 30, 2024, there were 115 shares of common stock related to RSU awards that had vested and the shares were not distributed to the participants.

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, 2024 was $48 thousand and expected to be recognized over a period of 1.0 years.

Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Condensed Consolidated Statements of Comprehensive Loss
Net loss	$ (1,595)	$ (3,493)	$ (3,788)	$ (6,155)
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments	7	(2)	(1)	(7)
Other comprehensive income (loss), net of tax	7	(2)	(1)	(7)
Comprehensive loss	$ (1,588)	$ (3,495)	$ (3,789)	$ (6,162)

- Definition

Amount after tax of increase (decrease) in equity from transactions and other events and circumstances from net income and other comprehensive income, attributable to parent entity. Excludes changes in equity resulting from investments by owners and distributions to owners.

+ References + Details

- Definition

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

+ References

+ Details

Commitments and Contingencies (Details) - Cowen and Company - USD ($)	May 11, 2023	Aug. 06, 2021
Litigation
Service fees sought		$ 1,350,000
Agreed settlement amount	$ 1,350,000
Litigation settlement, interest percent	9.00%
Litigation settlement, attorney fees payable	$ 675,000
Litigation settlement, attorney fees to be paid up front	275,000
Litigation settlement, attorney fees to be paid after six months	200,000
Litigation settlement, attorney fees to be paid after twelve months	$ 200,000

Stock-based Compensation - Stock-based compensation expense (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Compensation expense recognized
Total stock-based compensation expense	$ 65	$ 217	$ 137	$ 440
Sales and marketing
Compensation expense recognized
Total stock-based compensation expense	4	30	15	60
General and administrative
Compensation expense recognized
Total stock-based compensation expense	26	128	51	256
Research and development
Compensation expense recognized
Total stock-based compensation expense	$ 35	$ 59	$ 71	$ 124

Revenue Disaggregation and Operating Segments

6 Months Ended

Jun. 30, 2024

Revenue Disaggregation and Operating Segments

Revenue Disaggregation and Operating Segments

(7) 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 and six months ended June 30, 2024 and 2023, the Company primarily sold the Lap-Band system and accessories. The following table presents the Company’s revenue disaggregated by geography:


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2024		2023		2024		2023
United States	$	1,663	$	1,929	$	3,281	$	3,742
Australia		103		123		205		280
Europe		198		193		396		497
Rest of World		1		9		27		22
Total revenue	$	1,965	$	2,254	$	3,909	$	4,541

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, 2024 and 2023. There was no revenue or gross profit recorded for the DBSN device for the three and six months ended June 30, 2024 and 2023, as this product is still in the development stage. Additionally, there was no revenue recorded for the Obalon Balloon system during the three months and six months ended June 30, 2024 and 2023.

- 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.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 9
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-9

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 10
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-10

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 15
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-15

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-12

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-12

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-12

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-12

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (e)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-12

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (b)(2)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-13

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Name Accounting Standards Codification
-Topic 606
-Publisher FASB
-URI https://asc.fasb.org/606/tableOfContent

+ Details

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Current assets:
Cash and cash equivalents	$ 1,053	$ 4,459
Restricted cash	100	100
Accounts and other receivables (net of allowance for doubtful accounts of $636 and $804, respectively)	1,382	1,659
Inventory	3,246	3,741
Prepaid expenses and other current assets	306	337
Total current assets	6,087	10,296
Property and equipment, net	48	60
Operating lease right-of-use assets	202	250
Deferred tax asset, net	27	28
Other assets	29	29
Total assets	6,393	10,663
Current liabilities:
Accounts payable	1,030	1,689
Accrued and other liabilities	1,895	1,814
Warranty liability, current	163	163
Operating lease liabilities, current	113	111
Total current liabilities	3,201	3,777
Operating lease liabilities, noncurrent	103	151
Common stock warrant liability	54	72
Total liabilities	3,358	4,000
Commitments and contingencies (Note 10)
Stockholders' equity:
Common stock, $0.001 par value; 300,000,000 shares authorized at June 30, 2024 and December 31, 2023; 29,387,120 and 23,457,047 shares issued and outstanding at June 30, 2024 and December 31, 2023, respectively	29	23
Additional paid-in capital	642,457	642,302
Accumulated deficit	(639,362)	(635,574)
Accumulated other comprehensive loss	(89)	(88)
Total stockholders' equity	3,035	6,663
Total liabilities and stockholders' equity	6,393	10,663
Series C convertible preferred stock
Stockholders' equity:
Preferred stock, 10,000,000 shares authorized: Series C convertible preferred stock, $0.001 par value; 95,388 shares issued and outstanding at June 30, 2024 and December 31, 2023

Income Taxes

6 Months Ended

Jun. 30, 2024

Income Taxes

Income Taxes

(8) Income Taxes

During the three months ended June 30, 2024 and 2023, the Company recorded income tax expense of $15 thousand and $4 thousand, respectively. During the six months ended June 30, 2024 and 2023, the Company recorded income tax expense of $28 thousand and $18 thousand, respectively. The income tax expense is related to minimum state taxes and projected Australian and Netherlands income, respectively. The income tax provisions for the three and six months ended June 30, 2024 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 liabilities.

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 full valuation allowance at both June 30, 2024 and December 31, 2023.

- Definition

The entire disclosure for income tax.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-12

Reference 2: http://www.xbrl.org/2003/role/exampleRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 55
-Paragraph 231
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482663/740-10-55-231

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12C
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-12C

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12B
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-12B

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 270
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147477891/740-270-50-1

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SAB Topic 6.I.5.Q1)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479360/740-10-S99-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480990/946-20-50-13

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h)(2))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480678/235-10-S99-1

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org/740/tableOfContent

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-14

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 21
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-21

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 17
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-17

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 11.C)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479360/740-10-S99-2

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 30
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482603/740-30-50-2

+ Details

Equity

6 Months Ended

Jun. 30, 2024

Equity

Equity

(5) Equity

Common Stock Issued Related to Restricted Stock Units

During the three months ended June 30, 2024 and 2023, the Company issued 72 shares of common stock and 834 shares of common stock, respectively, subject to vesting of the restricted stock units. During the six months ended June 30, 2024 and 2023, the Company issued 115 shares of common stock and 1,668 shares of common stock, respectively, subject to vesting of restricted stock units. For further details see Note 9.

May 2024 Exercise of Warrants for Common Stock

On May 30, 2024, an accredited investor exercised outstanding warrants, of which 105,000 shares of common stock were issued in accordance with the terms of the warrant agreement. The Company received approximately $24 thousand of cash.

June 2024 Exercise of Warrants for Common Stock

On June 4, 2024, the Company issued 5,824,958 shares of common stock in exchange for 10,765,000 common stock purchase warrants. These warrants were exercised using the cashless mechanism within the warrant agreement.

February 2023 Public Offering of Common Stock and Warrants

On February 8, 2023, the Company closed a public offering of 1,275,000 units, with each consisting of one share of its common stock, or one pre-funded warrant to purchase one share of its common stock, and one warrant to purchase one and one-half shares of its common stock. Each unit was sold at the public offering price of $8.00. The warrants in the units are immediately exercisable at a price of $8.00 per share and expire five years from the date of issuance. Alternatively, each warrant can be exercised pursuant to the “alternative cashless exercise” provision, to which the holders would receive an aggregate number of shares of common stock equal the product of (x) the aggregate number of shares of common stock that would be issuable upon a cash exercise and (y) 0.50. For purposes of clarity, one common warrant to purchase one and one-half shares would be exercisable for 0.75 shares under this alternative cashless exercise provision. The shares of common stock (or pre-funded warrants in lieu thereof) and accompanying warrants were only purchasable together in this offering but were issued separately and immediately separable upon issuance. As of June 30, 2024 warrants to purchase 1,674,376 shares of common stock have been exercised under the alternative cashless exercise for a total of 835,313 shares of common stock.

Net proceeds, after deducting underwriting discounts and commissions and estimated offering expenses, were approximately $10.2 million. The Company has been using the net proceeds of this offering to continue implementation of its growth strategies, for working capital and general corporate purposes.

The Company also granted the underwriters an option to purchase an additional 191,250 shares of common stock and/or additional warrants to purchase up to 286,875 shares of common stock, to cover over-allotments, of which Maxim Group LLC exercised its option to purchase additional warrants to purchase 286,875 shares of common stock.

- Definition

The entire disclosure for equity.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481112/505-10-50-13

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (h)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481112/505-10-50-13

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481112/505-10-50-14

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 235
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147477968/946-235-50-2

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 235
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147477968/946-235-50-2

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 505
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147478448/946-505-50-6

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 815
-SubTopic 40
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480237/815-40-50-6

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.3-04)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480008/505-10-S99-1

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(e)(1))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480678/235-10-S99-1

Reference 10: http://fasb.org/us-gaap/role/ref/legacyRef
-Topic 505
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org/505/tableOfContent

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481112/505-10-50-13

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (g)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481112/505-10-50-13

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (i)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481112/505-10-50-13

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481112/505-10-50-14

Reference 15: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481112/505-10-50-14

Reference 16: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 16
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481112/505-10-50-16

Reference 17: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 18
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481112/505-10-50-18

Reference 18: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 18
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481112/505-10-50-18

Reference 19: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 18
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481112/505-10-50-18

+ Details

Commitments and Contingencies

6 Months Ended

Jun. 30, 2024

Commitments and Contingencies

Commitments and Contingencies

(10) Commitment and Contingencies

Litigation

On August 6, 2021, Cowen and Company, LLC 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 sought reimbursement of Cowen’s attorneys’ fees and interest in connection with its claim. On May 11, 2023, the Supreme Court of the State of New York issued the final judgement in favor of Cowen & Company in the amount of $1.35 million, plus interest at the statutory rate of 9% per annum from June 16, 2021 until judgement is paid in full, and reimbursement of $675,000 of Cowen’s attorneys’ fees, with $275,000 to be paid upfront, $200,000 paid after six months and $200,000 paid after 12 months. As of June 30, 2024, the Company has paid the judgement, interest and legal fees in full.

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 was 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.

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.