Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Apr. 14, 2023 | Jun. 30, 2022 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2022 | ||
Document Transition Report | false | ||
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 Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
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 | ||
ICFR Auditor Attestation Flag | false | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 2,649,043 | ||
Entity Public Float | $ 10,658,000 | ||
Entity Central Index Key | 0001427570 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Auditor Name | RSM US LLP | ||
Auditor Firm ID | 49 | ||
Auditor Location | Irvine, California |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 3,855 | $ 22,765 |
Restricted cash | 100 | 50 |
Accounts and other receivables (net of allowance for doubtful accounts of $410 and $1,172 respectively) | 2,180 | 2,815 |
Inventory | 3,611 | 3,003 |
Prepaid expenses and other current assets | 165 | 1,305 |
Total current assets | 9,911 | 29,938 |
Property and equipment, net | 698 | 1,454 |
Operating lease right-of-use assets | 171 | 266 |
Deferred tax asset, net | 56 | |
Other intangible assets, net | 260 | 20,827 |
Other assets | 46 | 46 |
Total assets | 11,142 | 52,531 |
Current liabilities: | ||
Accounts payable | 1,926 | 3,468 |
Accrued and other liabilities | 5,040 | 3,368 |
Warranty liability, current | 344 | 415 |
Operating lease liabilities, current | 171 | 279 |
Total current liabilities | 7,481 | 7,530 |
Warranty liability, noncurrent | 300 | |
Deferred tax liability, net | 367 | |
Total liabilities | 7,481 | 8,197 |
Stockholders' equity: | ||
Common stock, $0.001 par value; 300,000,000 shares authorized at December 31, 2022 and 100,000,000 at December 31, 2021; 519,219 and 356,641 shares issued and outstanding at December 31, 2022 and December 31, 2021, respectively | 1 | |
Additional paid-in capital | 627,935 | 622,399 |
Accumulated deficit | (624,187) | (577,973) |
Accumulated other comprehensive loss | (88) | (92) |
Total stockholders' equity | 3,661 | 44,334 |
Total liabilities and stockholders' equity | 11,142 | 52,531 |
Series C convertible preferred stock | ||
Stockholders' equity: | ||
Preferred stock, Value |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Allowance for doubtful accounts | $ 410 | $ 1,172 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 300,000,000 | 100,000,000 |
Common stock, shares issued | 519,219 | 356,641 |
Common stock, shares outstanding | 519,219 | 356,641 |
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 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Consolidated Statements of Operations | ||
Revenue | $ 11,240 | $ 13,600 |
Cost of revenue | 4,438 | 5,252 |
Gross profit | 6,802 | 8,348 |
Operating expenses: | ||
Sales and marketing | 14,093 | 8,893 |
General and administrative | 17,250 | 24,319 |
Research and development | 2,537 | 2,369 |
Loss on impairment of intangible assets and goodwill | 18,744 | 30,649 |
Loss on disposal of assets, net | 529 | |
Total operating expenses | 53,153 | 66,230 |
Operating loss | (46,351) | (57,882) |
Other expense (income), net: | ||
Interest expense, net | 113 | 832 |
Warrant expense | 2,813 | |
Loss on extinguishment of debt, net | 2,061 | |
Loss (Gain) on foreign currency exchange, net | 141 | (168) |
Other | (11) | |
Loss before income tax provision | (46,594) | (63,420) |
Income tax benefit | (380) | (274) |
Net loss | $ (46,214) | $ (63,146) |
Net loss per share - basic and diluted: | ||
Net loss per share - basic | $ (108.90) | $ (288.97) |
Net loss per share - diluted | $ (108.90) | $ (288.97) |
Shares used to compute basic net loss per share | 424,390 | 218,522 |
Shares used to compute diluted net loss per share | 424,390 | 218,522 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Consolidated Statements of Comprehensive Loss | ||
Net loss | $ (46,214) | $ (63,146) |
Other comprehensive income (loss), net of tax: | ||
Foreign currency translation adjustments | 4 | 29 |
Other comprehensive income, net of tax | 4 | 29 |
Comprehensive loss | $ (46,210) | $ (63,117) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Preferred Stock Series B convertible preferred stock | Preferred Stock Series C convertible preferred stock | Preferred Stock Series D Mirroring Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Total |
Balance at Dec. 31, 2020 | $ 1 | $ 529,435 | $ (514,827) | $ (121) | $ 14,488 | |||
Balance (in shares) at Dec. 31, 2020 | 3 | 95,388 | 69,726 | |||||
Changes in Stockholders' (Deficit) Equity | ||||||||
Net loss | (8,763) | (8,763) | ||||||
Balance at Jun. 30, 2021 | 581,823 | (523,590) | 58,132 | |||||
Balance at Dec. 31, 2020 | $ 1 | 529,435 | (514,827) | (121) | 14,488 | |||
Balance (in shares) at Dec. 31, 2020 | 3 | 95,388 | 69,726 | |||||
Changes in Stockholders' (Deficit) Equity | ||||||||
Net loss | (25,897) | (25,897) | ||||||
Stock-based compensation expense, net | 9,971 | 9,971 | ||||||
Balance at Sep. 30, 2021 | 620,125 | (540,724) | 79,312 | |||||
Balance at Dec. 31, 2020 | $ 1 | 529,435 | (514,827) | (121) | 14,488 | |||
Balance (in shares) at Dec. 31, 2020 | 3 | 95,388 | 69,726 | |||||
Changes in Stockholders' (Deficit) Equity | ||||||||
Net loss | (63,146) | (63,146) | ||||||
Other comprehensive income (loss), net of tax | 29 | 29 | ||||||
Issuance of common stock pursuant to reverse acquisition | $ (1) | 30,562 | 30,561 | |||||
Issuance of common stock pursuant to reverse acquisition (in shares) | (3) | 66,801 | ||||||
Stock-based compensation expense, net | 12,227 | 12,227 | ||||||
Stock options exercised | 416 | 416 | ||||||
Stock options exercised (in shares) | 3,654 | |||||||
Issuance of stock from RSUs, shares | 37,986 | |||||||
Issuance of warrants | 4,508 | 4,508 | ||||||
Institutional exercise of warrants | 44,645 | 44,645 | ||||||
Institutional exercise of warrants (in shares) | 177,724 | |||||||
Warrant liability reclassified to equity, value | 476 | 476 | ||||||
Restricted shares issued for consulting services | 130 | 130 | ||||||
Restricted shares issued for consulting services (Shares) | 750 | |||||||
Balance at Dec. 31, 2021 | 622,399 | (577,973) | (92) | 44,334 | ||||
Balance (in shares) at Dec. 31, 2021 | 95,388 | 356,641 | ||||||
Balance at Mar. 31, 2021 | 532,504 | (519,701) | 12,708 | |||||
Changes in Stockholders' (Deficit) Equity | ||||||||
Net loss | (3,889) | (3,889) | ||||||
Balance at Jun. 30, 2021 | 581,823 | (523,590) | 58,132 | |||||
Changes in Stockholders' (Deficit) Equity | ||||||||
Net loss | (17,134) | (17,134) | ||||||
Stock-based compensation expense, net | 10,234 | 10,234 | ||||||
Balance at Sep. 30, 2021 | 620,125 | (540,724) | 79,312 | |||||
Balance at Dec. 31, 2021 | 622,399 | (577,973) | (92) | 44,334 | ||||
Changes in Stockholders' (Deficit) Equity | ||||||||
Net loss | (8,115) | (8,115) | ||||||
Stock-based compensation expense, net | 719 | 719 | ||||||
Balance at Mar. 31, 2022 | 623,118 | (586,088) | 36,959 | |||||
Balance at Dec. 31, 2021 | 622,399 | (577,973) | (92) | 44,334 | ||||
Balance (in shares) at Dec. 31, 2021 | 95,388 | 356,641 | ||||||
Changes in Stockholders' (Deficit) Equity | ||||||||
Net loss | (17,559) | (17,559) | ||||||
Stock-based compensation expense, net | 1,489 | 1,489 | ||||||
Balance at Jun. 30, 2022 | 626,380 | (595,532) | 30,776 | |||||
Balance at Dec. 31, 2021 | 622,399 | (577,973) | (92) | 44,334 | ||||
Balance (in shares) at Dec. 31, 2021 | 95,388 | 356,641 | ||||||
Changes in Stockholders' (Deficit) Equity | ||||||||
Net loss | (29,745) | (29,745) | ||||||
Stock-based compensation expense, net | 1,848 | 1,848 | ||||||
Balance at Sep. 30, 2022 | 626,739 | (607,718) | 18,953 | |||||
Balance at Dec. 31, 2021 | 622,399 | (577,973) | (92) | 44,334 | ||||
Balance (in shares) at Dec. 31, 2021 | 95,388 | 356,641 | ||||||
Changes in Stockholders' (Deficit) Equity | ||||||||
Net loss | (46,214) | (46,214) | ||||||
Other comprehensive income (loss), net of tax | 4 | 4 | ||||||
Common stock purchased | 639 | 639 | ||||||
Common stock purchased (in shares) | 47,851 | |||||||
Series D Mirroring preferred stock issued (in shares) | 2,500 | |||||||
Preferred stock cancelled, shares | (2,500) | |||||||
Stock-based compensation expense, net | 2,087 | $ 2,087 | ||||||
Cancellation of common stock pursuant to reverse acquisition (in shares) | (20,045) | |||||||
Stock options exercised (in shares) | 0 | |||||||
Issuance of stock from RSUs, shares | 21,362 | |||||||
Issuance of stock for bonuses, value | 318 | $ 318 | ||||||
Issuance of stock for bonuses, shares | 28,769 | |||||||
Institutional exercise of warrants | $ 1 | 2,492 | 2,493 | |||||
Institutional exercise of warrants (in shares) | 84,641 | |||||||
Balance at Dec. 31, 2022 | $ 1 | 627,935 | (624,187) | $ (88) | 3,661 | |||
Balance (in shares) at Dec. 31, 2022 | 95,388 | 519,219 | ||||||
Balance at Mar. 31, 2022 | 623,118 | (586,088) | 36,959 | |||||
Changes in Stockholders' (Deficit) Equity | ||||||||
Net loss | (9,444) | (9,444) | ||||||
Stock-based compensation expense, net | 770 | 770 | ||||||
Balance at Jun. 30, 2022 | 626,380 | (595,532) | 30,776 | |||||
Changes in Stockholders' (Deficit) Equity | ||||||||
Net loss | (12,186) | (12,186) | ||||||
Stock-based compensation expense, net | 359 | 359 | ||||||
Balance at Sep. 30, 2022 | $ 626,739 | $ (607,718) | $ 18,953 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Cash flows from operating activities: | ||
Net loss | $ (46,214) | $ (63,146) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation expense | 330 | 232 |
Amortization of intangible assets | 1,823 | 1,739 |
Noncash interest expense | 133 | |
Impairment of intangible assets | 18,744 | 30,649 |
Loss on extinguishment of debt, net | 2,061 | |
Loss on disposal of assets, net | 529 | |
Stock-based compensation | 2,087 | 12,227 |
Bad debt expense | (43) | 89 |
Provision for inventory excess and obsolescence | 579 | 294 |
Deferred income tax | (423) | (248) |
Warrant expense | 2,813 | |
Amortization of debt discount and deferred debt issuance costs | 494 | |
Other noncash items | (23) | |
Change in operating assets and liabilities, net of business combination: | ||
Accounts and other receivables | 678 | (284) |
Inventory | (1,187) | (369) |
Prepaid expenses and other current assets | 1,141 | (76) |
Accounts payable and accrued liabilities | 448 | (1,280) |
Warranty liability | (371) | (703) |
Net cash used in operating activities | (21,902) | (15,375) |
Cash flows from investing activities: | ||
Capital expenditures | (131) | (352) |
Acquisition of Lap-Band product line assets | (3,000) | |
Proceeds from acquisition | 5,207 | |
Proceeds from sale of capital assets | 39 | |
Cash (used in) provided by investing activities: | (92) | 1,855 |
Cash flows from financing activities: | ||
Payments of financing costs | (3,234) | |
Proceeds from sale and issuance of securities | 639 | |
Proceeds from warrants exercised | 2,491 | 45,616 |
Proceeds from stock options exercised | 417 | |
Proceeds from credit agreement | 1,000 | |
Payment of credit agreement | (10,500) | |
Net cash provided by financing activities | 3,130 | 33,299 |
Effect of currency exchange rate changes on cash and cash equivalents | 4 | 29 |
Net (decrease) increase in cash, cash equivalents and restricted cash | (18,860) | 19,808 |
Cash, cash equivalents and restricted cash at beginning of period | 22,815 | 3,007 |
Cash, cash equivalents and restricted cash at end of period | 3,955 | 22,815 |
Supplemental disclosure: | ||
Cash paid for income taxes | 5 | 102 |
Cash paid for interest | 296 | |
Noncash investing and financing activities: | ||
Capital expenditures accruals | $ 6 | 5 |
Purchase price, net of cash received | 25,355 | |
Fair value of warrants included as a component of loss on extinguishment of debt | 2,974 | |
Fair value of common stock and warrants issued related to the fundamental transaction exchange | 2,813 | |
Fair value of common stock issued for professional services | $ 97 |
Description of the Business and
Description of the Business and Risks and Uncertainties | 12 Months Ended |
Dec. 31, 2022 | |
Description of the Business and Risks and Uncertainties | |
Description of the Business and Risks and Uncertainties | (1) Description of the Business and Risks and Uncertainties Description of Business We were incorporated under the laws of Delaware on January 2, 2008. On June 15, 2021, we completed a merger with ReShape Lifesciences Inc. Pursuant to the Merger Agreement, a wholly owned subsidiary of Obalon merged with and into ReShape, with ReShape surviving the merger as a wholly owned subsidiary of Obalon. As a result of the merger, Obalon, the parent company, was renamed “ReShape Lifesciences Inc.” and ReShape was named ReShape Weightloss Inc. ReShape Lifesciences’ shares of common stock trade on the Nasdaq under the symbol RSLS. ReShape Medical (formerly ReShape Lifesciences Inc.) was incorporated in the state of Minnesota in December 2002 and reincorporated in the state of Delaware in July 2004. In 2017, the Company changed its name from EnteroMedics Inc. to ReShape Lifesciences Inc. The Company is headquartered in San Clemente, California. The Company is a developer of minimally invasive medical devices that advance bariatric surgery to treat obesity and metabolic diseases. The Company’s current portfolio consists of the Lap-Band ® TM TM Risks and Uncertainties The Company continues to devote significant resources to developing its product technology, commercialization activities and raising capital. These activities are subject to significant risks and uncertainties, including the ability to obtain additional financing, and there can be no assurance that the Company will be successful in obtaining additional financing on favorable terms, or at all. If adequate funds are not available, the Company may have to further reduce its cost structure until financing is obtained and/or delay development, or commercialization of products, or license to third parties the rights to commercialize products, or technologies that the Company would otherwise seek to commercialize. Refer to Note 5 for additional information about the Company’s liquidity, going concern and management’s plans. The medical device industry is characterized by frequent and extensive litigation and administrative proceedings over patent and other intellectual property rights. Whether a product infringes a patent involves complex legal and factual issues, the determination of which is often difficult to predict, and the outcome may be uncertain until the court has entered final judgment and all appeals are exhausted. The Company’s competitors may assert that its products or the use of the Company’s products are covered by U.S. or foreign patents held by them. Refer to Note 18 for additional information about contingencies and litigation matters. |
2021 Restatement and Other Corr
2021 Restatement and Other Corrections of Previously Issued Consolidated Financial Statements | 12 Months Ended |
Dec. 31, 2022 | |
2021 Restatement and Other Corrections of Previously Issued Consolidated Financial Statements | |
2021 Restatement and Other Corrections of Previously Issued Consolidated Financial Statements | (2) 2021 Restatement and Other Corrections of Previously Issued Consolidated Financial Statements Management identified the following misstatements that required restatement of our previously issued 2021 financial statements as follows: a. A D&O tail policy of $1.9 million should not have been recorded as an asset at the time of the Obalon merger. This resulted in an increase to goodwill of $1.9 million at the time of the merger and an increase to the subsequent impairment of goodwill at December 31, 2021. Additionally, the amortization of this asset resulted in an overstatement of general and administrative expenses of approximately $0.2 million, for the year ended December 31, 2021 that is now reversed. b. The Company identified certain valuation-related errors in the determination of grant date fair values related to stock options issued during the third quarter of 2021. This resulted in a reduction of stock based compensation expenses of $0.5 million and a corresponding reduction to additional paid in capital for the year ended December 31, 2021. c. The Company did not appropriately establish a reserve for uncertain tax positions and did not appropriately record deferred tax valuation allowances to assets written off during the year ended December 31, 2021 and the corresponding $0.2 million tax benefit. d. The Company recorded legal accruals for potential loss contingencies of approximately $0.2 million for the year ended December 31, 2021. e. As previously identified, the Company had an error in the computation of the weighted average shares used to compute basic and diluted net loss per share, refer to the statement of operations tables below. The following tables summarize the effects of the restatements on each financial statement line item as of the dates and for the periods indicated. The share and per share information has been adjusted for the reverse stock splits, for further details see Note 4 below. The effects of the restatement are incorporated within Notes 2, 3, 6, 8, 9, 12, 16 and 17. Consolidated Balance Sheet as of December 31, 2021 As Previously Reported Adjustments As Restated Prepaid expenses and other current assets $ 1,622 $ (317) $ 1,305 Total current assets 30,255 (317) 29,938 Other assets 1,456 (1,410) 46 Total assets 54,258 (1,727) 52,531 Accrued and other liabilities 3,169 199 3,368 Total current liabilities 7,331 199 7,530 Deferred income taxes 555 (188) 367 Total liabilities 8,186 11 8,197 Additional paid-in capital 622,924 (525) 622,399 Accumulated deficit (576,760) (1,213) (577,973) Total stockholders’ equity 46,072 (1,738) 44,334 Total liabilities and stockholders’ equity 54,258 (1,727) 52,531 Consolidated Statement of Operations for the year ended December 31, 2021 Year Ended December 31, 2021 As Previously Stated Adjustments As Restated Sales and marketing $ 9,165 $ (272) $ 8,893 General and administrative 24,410 (91) 24,319 Research and development 2,522 (153) 2,369 Loss on impairment of intangible asset and goodwill 28,752 1,897 30,649 Total operating expenses 64,849 1,381 66,230 Operating loss (56,501) (1,381) (57,882) Loss before income tax provision (62,039) (1,381) (63,420) Income tax benefit (106) (168) (274) Net loss (61,933) (1,213) (63,146) Net loss per share - basic and diluted: Net loss per share - basic and diluted $ (250.16) $ (38.81) $ (288.97) Shares used to compute basic and diluted net loss per share 247,571 (29,049) 218,522 Consolidated Statement of Other Comprehensive Income for the year ended December 31, 2021 Year Ended December 31, 2021 As Previously Stated Adjustments As Restated Net loss $ (61,933) $ (1,213) $ (63,146) Comprehensive loss (61,904) (1,213) (63,117) Consolidated Statement of Stockholders’ Equity for the year ended December 31, 2021 APIC Accumulated Deficit Total Equity As Previously As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Stated Adjustments As Restated Balance December 31, 2020 $ 529,435 $ — $ 529,435 $ (514,827) $ — $ (514,827) $ 14,488 $ — $ 14,488 Net loss — — — (61,933) (1,213) (63,146) (61,933) (1,213) (63,146) Stock-based compensation expense, net 12,752 (525) 12,227 — — — 12,752 (525) 12,227 Balance December 31, 2021 622,924 (525) 622,399 (576,760) (1,213) (577,973) 46,072 (1,738) 44,334 Consolidated Statement of Cash Flow for the year ended December 31, 2021 Year Ended December 31, 2021 As Previously Reported Adjustment As Restated Cash flows from operating activities: Net loss $ (61,933) $ (1,213) $ (63,146) Loss on impairment of intangible assets and goodwill 28,752 1,897 30,649 Stock-based compensation 12,752 (525) 12,227 Deferred income tax benefit (60) (188) (248) Prepaid expenses and other current assets (393) 317 (76) Accounts payable and accrued liabilities (1,480) 200 (1,280) Other 488 (488) — Restatement of Previously Issued Condensed Consolidated Financial Statements (Unaudited) As a result of the misstatements noted above, we have restated our previously reported unaudited consolidated balance sheets as of June 30, 2021 and September 30, 2021. We have also restated the unaudited consolidated statement of operations for the three months ended March 31, 2021, the three and six months ended June 30, 2021, and the three and nine months ended September 30, 2021, and the unaudited statement of cash flow for the three and six months ended June 30, 2021 and the nine months ended September 30, 2021. The following tables present the impact of the restatements, to the applicable line items in the unaudited consolidated balance sheets, unaudited consolidated statement of operations, and unaudited statements of cash flow to the Company’s previously reported consolidated financial statements for the above mentioned periods. Condensed Consolidated Balance Sheet as of June 30, 2021 June 30, 2021 As Previously Reported Adjustments As Restated Prepaid expenses and other current assets $ 1,371 $ (302) $ 1,069 Total current assets 65,605 (302) 65,303 Goodwill 21,623 1,897 23,520 Other assets 1,628 (1,582) 46 Total assets 120,000 13 120,013 Accumulated deficit (523,603) 13 (523,590) Total stockholders’ equity 58,119 13 58,132 Total liabilities and stockholders’ equity 120,000 13 120,013 Condensed Consolidated Balance Sheet as of September 30, 2021 September 30, 2021 As Previously Reported Adjustments As Restated Prepaid expenses and other current assets $ 1,633 $ (316) $ 1,317 Total current assets 37,589 (316) 37,273 Goodwill 21,053 1,897 22,950 Other assets 1,535 (1,489) 46 Total assets 90,698 92 90,790 Additional paid-in capital 620,611 (486) 620,125 Accumulated deficit (541,302) 578 (540,724) Total stockholders’ equity 79,220 92 79,312 Total liabilities and stockholders’ equity 90,698 92 90,790 Condensed Consolidated Statement of Operations for the three months ended March 31, 2021 As Previously Reported Adjustment As Revised Net loss per share - basic and diluted $ (62.04) $ 0.16 $ (61.88) Shares used to compute basic and diluted net loss per share 78,560 203 78,763 Condensed Consolidated Statement of Operations for the three and six months ended June 30, 2021 Three Months Ended June 30, 2021 Six Months Ended June 30, 2021 As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated General and administrative $ 4,311 $ (13) $ 4,298 $ 7,031 $ (13) $ 7,018 Total operating expenses 5,855 (13) 5,842 10,396 (13) 10,383 Operating loss (3,702) 13 (3,689) (5,960) 13 (5,947) Loss before income tax provision (3,874) 13 (3,861) (8,723) 13 (8,710) Net loss (3,902) 13 (3,889) (8,776) 13 (8,763) Net loss per share - basic and diluted: Net loss per share - basic and diluted $ (23.72) $ (18.98) $ (42.70) $ (55.34) $ (47.85) $ (103.19) Shares used to compute basic and diluted net loss per share 164,523 (73,443) 91,080 158,575 (73,654) 84,921 Condensed Consolidated Statement of Operations for the three and nine months ended September 30, 2021 Three Months Ended September 30, 2021 Nine Months Ended September 30, 2021 As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Sales and marketing $ 3,496 $ (250) $ 3,246 $ 6,186 $ (249) $ 5,937 General and administrative 12,052 (169) 11,883 19,085 (183) 18,902 Research and development 1,571 (146) 1,425 2,245 (146) 2,099 Total operating expenses 17,119 (565) 16,554 27,516 (578) 26,938 Operating loss (14,984) 565 (14,419) (20,944) 578 (20,366) Loss before income tax provision (17,729) 565 (17,164) (26,452) 578 (25,874) Net loss (17,699) 565 (17,134) (26,475) 578 (25,897) Net loss per share - basic and diluted: Net loss per share - basic and diluted $ (73.76) $ 23.63 $ (50.13) $ (125.43) $ (24.88) $ (150.31) Shares used to compute basic and diluted net loss per share 239,948 101,820 341,768 210,934 (38,646) 172,288 Condensed Consolidated Statement of Other Comprehensive Loss for the three and six months ended June 30, 2021 Three Months Ended June 30, 2021 Six Months Ended June 30, 2021 As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Net loss $ (3,902) $ 13 $ (3,889) $ (8,776) $ 13 $ (8,763) Comprehensive loss (3,909) 13 (3,896) (8,764) 13 (8,751) Condensed Consolidated Statement of Other Comprehensive Loss for the three and nine months ended September 30, 2021 Three Months Ended September 30, 2021 Nine Months Ended September 30, 2021 As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Net loss $ (17,699) $ 565 $ (17,134) $ (26,475) $ 578 $ (25,897) Comprehensive loss (17,697) 565 (17,132) (26,461) 578 (25,883) Condensed Consolidated Statement of Stockholders’ Equity for the three months ended June 30, 2021 Additional Paid-In Capital Accumulated Deficit Total Equity As Previously As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Stated Adjustments As Restated Balance March 31, 2021 $ 532,504 $ — $ 532,504 $ (519,701) $ — $ (519,701) $ 12,708 $ — $ 12,708 Net loss — — — (3,902) 13 (3,889) (3,902) 13 (3,889) Balance June 30, 2021 581,823 — 581,823 (523,603) 13 (523,590) 58,119 13 58,132 Condensed Consolidated Statement of Stockholders’ Equity for the six months ended June 30, 2021 Additional Paid-In Capital Accumulated Deficit Total Equity As Previously As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Stated Adjustments As Restated Balance December 31, 2020 $ 529,435 $ — $ 529,435 $ (514,827) $ — $ (514,827) $ 14,488 $ — $ 14,488 Net loss — — — (8,776) 13 (8,763) (8,776) 13 (8,763) Balance June 30, 2021 581,823 — 581,823 (523,603) 13 (523,590) 58,119 13 58,132 Condensed Consolidated Statement of Stockholders’ Equity for the three months ended September 30, 2021 Additional Paid-In Capital Accumulated Deficit Total Equity As Previously As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Stated Adjustments As Restated Balance June 30, 2021 $ 581,823 $ — $ 581,823 $ (523,603) $ 13 $ (523,590) $ 58,119 $ 13 $ 58,132 Net loss — — — (17,699) 565 (17,134) (17,699) 565 (17,134) Stock-based compensation expense, net 10,720 (486) 10,234 — — — 10,720 (486) 10,234 Balance September 30, 2021 620,611 (486) 620,125 (541,302) 578 (540,724) 79,220 92 79,312 Condensed Consolidated Statement of Stockholders’ Equity for the nine months ended September 30, 2021 Additional Paid-In Capital Accumulated Deficit Total Equity As Previously As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Stated Adjustments As Restated Balance December 31, 2020 $ 529,435 $ — $ 529,435 $ (514,827) $ — $ (514,827) $ 14,488 $ — $ 14,488 Net loss — — — (26,475) 578 (25,897) (26,475) 578 (25,897) Stock-based compensation expense, net 10,457 (486) 9,971 — — — 10,457 (486) 9,971 Balance September 30, 2021 620,611 (486) 620,125 (541,302) 578 (540,724) 79,220 92 79,312 Condensed Consolidated Statement of Cash Flow for the six months ended June 30, 2021 Six Months Ended June 30, 2021 As Previously Reported Adjustment As Restated Cash flows from operating activities: Net loss $ (8,776) $ 13 $ (8,763) Prepaid expenses and other current assets (267) 303 36 Other 316 (316) — Condensed Consolidated Statement of Cash Flow for the nine months ended September 30, 2021 Nine Months Ended September 30, 2021 As Previously Reported Adjustment As Restated Cash flows from operating activities: Net loss $ (26,475) $ 578 $ (25,897) Stock-based compensation 10,457 (486) 9,971 Prepaid expenses and other current assets (399) 316 (83) Other 408 (408) — |
2022 Restatement and Other Corr
2022 Restatement and Other Corrections of Previously Issued Condensed Consolidated Financial Statements (Unaudited) | 12 Months Ended |
Dec. 31, 2022 | |
2022 Restatement and Other Corrections of Previously Issued Condensed Consolidated Financial Statements (Unaudited) | |
2022 Restatement and Other Corrections of Previously Issued Condensed Consolidated Financial Statements (Unaudited) | (3) 2022 Restatement and Other Corrections of Previously Issued Condensed Consolidated Financial Statements (Unaudited) As a result of the misstatements noted in Note 2, we have restated our previously reported unaudited consolidated balance sheets as of March 31, 2022, June 30, 2022 and September 30, 2022. We have also restated the unaudited consolidated statement of operations for the three months ended March 31, 2022, the three and six months ended June 30, 2022, and the three and nine months ended September 30, 2022, and the unaudited statement of cash flow for the three months ended March 31, 2022, six months ended June 30, 2022 and the nine months ended September 30, 2022. In addition to this, management identified an additional impairment of intangibles of $0.5 million related to the BarioSurg, ReShape Vest, tradenames that was recorded in the fourth quarter of 2022 that should have been recorded during the third quarter of 2022 and is reflected in the consolidated financial statements below. Condensed Consolidated Balance Sheet as of March 31, 2022 March 31, 2022 As Previously Reported Adjustments As Restated Prepaid expenses and other current assets $ 1,759 $ (316) $ 1,443 Total current assets 23,627 (316) 23,311 Other assets 1,377 (1,331) 46 Total assets 47,270 (1,647) 45,623 Accrued and other liabilities 3,463 19 3,482 Total current liabilities 8,151 19 8,170 Total liabilities 8,645 19 8,664 Additional paid-in capital 623,671 (553) 623,118 Accumulated deficit (584,975) (1,113) (586,088) Total stockholders’ equity 38,625 (1,666) 36,959 Total liabilities and stockholders’ equity 47,270 (1,647) 45,623 Condensed Consolidated Balance Sheet as of June 30, 2022 June 30, 2022 As Previously Reported Adjustments As Restated Prepaid expenses and other current assets $ 1,269 $ (316) $ 953 Total current assets 19,487 (316) 19,171 Other assets 1,298 (1,252) 46 Total assets 41,925 (1,568) 40,357 Accrued and other liabilities 5,814 19 5,833 Total current liabilities 9,190 19 9,209 Total liabilities 9,562 19 9,581 Additional paid-in capital 626,986 (606) 626,380 Accumulated deficit (594,551) (981) (595,532) Total stockholders’ equity 32,363 (1,587) 30,776 Total liabilities and stockholders’ equity 41,925 (1,568) 40,357 Condensed Consolidated Balance Sheet as of September 30, 2022 September 30, 2022 As Previously Reported Adjustments As Restated Prepaid expenses and other current assets $ 926 $ (316) $ 610 Total current assets 13,573 (316) 13,257 Other intangible assets, net 12,513 (482) 12,031 Other assets 1,219 (1,173) 46 Total assets 28,456 (1,971) 26,485 Accrued and other liabilities 4,848 19 4,867 Total current liabilities 7,513 19 7,532 Total liabilities 7,513 19 7,532 Additional paid-in capital 627,373 (634) 626,739 Accumulated deficit (606,362) (1,356) (607,718) Total stockholders’ equity 20,943 (1,990) 18,953 Total liabilities and stockholders’ equity 28,456 (1,971) 26,485 Condensed Consolidated Statement of Operations for the three months ended March 31, 2022 Three Months Ended March 31, 2022 As Previously Stated Adjustments As Restated Sales and marketing $ 4,707 $ (13) $ 4,694 General and administrative 4,163 (271) 3,892 Research and development 748 (3) 745 Total operating expenses 9,618 (287) 9,331 Operating loss (8,400) 287 (8,113) Loss before income tax provision (8,372) 287 (8,085) Income tax benefit (157) 187 30 Net loss (8,215) 100 (8,115) Net loss per share - basic and diluted: Net loss per share - basic and diluted $ (22.16) $ 0.29 $ (21.87) Shares used to compute basic and diluted net loss per share 370,792 239 371,031 Condensed Consolidated Statement of Operations for the three and six months ended June 30, 2022 Three Months Ended June 30, 2022 Six Months Ended June 30, 2022 As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Sales and marketing $ 4,663 $ (27) $ 4,636 $ 9,371 $ (41) $ 9,330 General and administrative 5,454 $ (91) 5,363 9,616 (362) 9,254 Research and development 761 (14) 747 1,508 (16) 1,492 Total operating expenses 11,259 (132) 11,127 20,876 (419) 20,457 Operating loss (9,376) 132 (9,244) (17,775) 419 (17,356) Loss before income tax provision (9,567) 132 (9,435) (17,939) 419 (17,520) Income tax benefit 9 — 9 (148) 187 39 Net loss (9,576) 132 (9,444) (17,791) 232 (17,559) Net loss per share - basic and diluted: Net loss per share - basic and diluted $ (24.79) $ 0.34 $ (24.45) $ (46.98) $ 0.61 $ (46.37) Condensed Consolidated Statement of Operations for the three and nine months ended September 30, 2022 Three Months Ended September 30, 2022 Nine Months Ended September 30, 2022 As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Sales and marketing $ 2,619 $ (14) $ 2,605 $ 11,990 $ (54) $ 11,936 General and administrative 3,872 (88) 3,784 13,488 (451) 13,037 Research and development 588 (5) 583 2,096 (21) 2,075 Loss on impairment of intangible assets 6,947 482 7,429 6,947 482 7,429 Total operating expenses 14,027 375 14,402 34,904 (44) 34,860 Operating loss (11,926) (375) (12,301) (29,702) 44 (29,658) Loss before income tax provision (12,174) (375) (12,549) (30,113) 44 (30,069) Income tax benefit (363) — (363) (511) 187 (324) Net loss (11,811) (375) (12,186) (29,602) (143) (29,745) Net loss per share - basic and diluted: Net loss per share - basic and diluted $ (26.18) $ (0.83) $ (27.01) $ (73.43) $ (0.36) $ (73.79) Condensed Consolidated Statement of Other Comprehensive loss for the three months ended March 31, 2022 Three Months Ended March 31, 2022 As Previously Stated Adjustments As Restated Net loss $ (8,215) $ 100 $ (8,115) Comprehensive loss (8,194) 100 (8,094) Condensed Consolidated Statement of Other Comprehensive Loss for the three and six months ended June 30, 2022 Three Months Ended June 30, 2022 Six Months Ended June 30, 2022 As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Net loss $ (9,576) $ 132 $ (9,444) $ (17,791) $ 232 $ (17,559) Comprehensive loss (9,577) 132 (9,445) (17,771) 232 (17,539) Condensed Consolidated Statement of Other Comprehensive Loss for the three and nine months ending September 30, 2022 Three Months Ended September 30, 2022 Nine Months Ended September 30, 2022 As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Net loss $ (11,811) $ (375) $ (12,186) $ (29,602) $ (143) $ (29,745) Comprehensive loss (11,807) (375) (12,182) (29,578) (143) (29,721) Condensed Consolidated Statement of Stockholders’ Equity for the three months ended March 31, 2022 Additional Paid-In Capital Accumulated Deficit Total Equity As Previously As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Stated Adjustments As Restated Balance December 31, 2021 $ 622,924 $ (525) $ 622,399 $ (576,760) $ (1,213) $ (577,973) $ 46,072 $ (1,738) $ 44,334 Net loss — — — (8,215) 100 (8,115) (8,215) 100 (8,115) Stock-based compensation expense, net 747 (28) 719 — — — 747 (28) 719 Balance March 31, 2022 623,671 (553) 623,118 (584,975) (1,113) (586,088) 38,625 (1,666) 36,959 Condensed Consolidated Statement of Stockholders’ Equity for the three months ended June 30, 2022 Additional Paid-In Capital Accumulated Deficit Total Equity As Previously As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Stated Adjustments As Restated Balance March 31, 2022 $ 623,671 $ (553) $ 623,118 $ (584,975) $ (1,113) $ (586,088) $ 38,625 $ (1,666) $ 36,959 Net loss — (9,576) 132 (9,444) (9,576) 132 (9,444) Stock-based compensation expense, net 823 (53) 770 — — — 823 (53) 770 Balance June 30, 2022 626,986 (606) 626,380 (594,551) (981) (595,532) 32,363 (1,587) 30,776 Condensed Consolidated Statement of Stockholders’ Equity for the six months ended June 30, 2022 Additional Paid-In Capital Accumulated Deficit Total Equity As Previously As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Stated Adjustments As Restated Balance December 31, 2021 $ 622,924 $ (525) $ 622,399 $ (576,760) $ (1,213) $ (577,973) $ 46,072 $ (1,738) $ 44,334 Net loss — — — (17,791) 232 (17,559) (17,791) 232 (17,559) Stock-based compensation expense, net 1,570 (81) 1,489 — — — 1,570 (81) 1,489 Balance June 30, 2022 626,986 (606) 626,380 (594,551) (981) (595,532) 32,363 (1,587) 30,776 Condensed Consolidated Statement of Stockholders’ Equity for the three months ended September 30, 2022 Additional Paid-In Capital Accumulated Deficit Total Equity As Previously As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Stated Adjustments As Restated Balance June 30, 2022 $ 626,986 $ (606) $ 626,380 $ (594,551) $ (981) $ (595,532) $ 32,363 $ (1,587) $ 30,776 Net loss — — — (11,811) (375) (12,186) (11,811) (375) (12,186) Stock-based compensation expense, net 387 (28) 359 — — — 387 (28) 359 Balance September 30, 2022 627,373 (634) 626,739 (606,362) (1,356) (607,718) 20,943 (1,990) 18,953 Condensed Consolidated Statement of Stockholders’ Equity for the nine months ended September 30, 2022 Additional Paid-In Capital Accumulated Deficit Total Equity As Previously As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Stated Adjustments As Restated Balance December 31, 2021 $ 622,924 $ (525) $ 622,399 $ (576,760) $ (1,213) $ (577,973) $ 46,072 $ (1,738) $ 44,334 Net loss — — — (29,602) (143) (29,745) (29,602) (143) (29,745) Stock-based compensation expense, net 1,957 (109) 1,848 — — — 1,957 (109) 1,848 Balance September 30, 2022 627,373 (634) 626,739 (606,362) (1,356) (607,718) 20,943 (1,990) 18,953 Condensed Consolidated Statement of Cash Flow for the three months ended March 30, 2022 Three Months Ended March 31, 2022 As Previously Reported Adjustment As Restated Cash flows from operating activities: Net loss $ (8,215) $ 100 $ (8,115) Stock-based compensation 747 (28) 719 Deferred income tax benefit (187) 187 — Accounts payable and accrued liabilities 420 (180) 240 Other 79 (79) — Condensed Consolidated Statement of Cash Flow for the six months ended June 30, 2022 Six Months Ended June 30, 2022 As Previously Reported Adjustment As Restated Cash flows from operating activities: Net loss $ (17,791) $ 232 $ (17,559) Stock-based compensation 1,570 (81) 1,489 Deferred income tax benefit (188) 188 — Accounts payable and accrued liabilities 1,681 (181) 1,500 Other 158 (158) — Condensed Consolidated Statement of Cash Flow for the nine months Ended September 30, 2022 Nine Months Ended September 30, 2022 As Previously Reported Adjustment As Restated Cash flows from operating activities: Net loss $ (29,602) $ (143) $ (29,745) Loss on impairment of intangible assets and goodwill 6,947 482 7,429 Stock-based compensation 1,957 (109) 1,848 Deferred income tax benefit (555) 187 (368) Accounts payable and accrued liabilities 129 (180) (51) Other 237 (237) — |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | (4) Summary of Significant Accounting Policies Basis of Presentation The Company has prepared the accompanying consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”). Reverse Stock Splits On December 23, 2022, at the commencement of trading, the Company effected a 1 On June 15, 2021, and immediately prior to the closing of the merger, the Company effected a 1 Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany transactions and accounts have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. 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 on June 15, 2021, with Obalon, 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, for further details see Note 12. Cash and Cash Equivalents The Company considers highly liquid investments generally with maturities of 90 days or less when purchased to be cash equivalents. Cash equivalents are stated at cost, which approximates market value. The Company’s cash equivalents are primarily in money market funds and certificates of deposit. The Company deposits its cash and cash equivalents in high-quality credit institutions. Restricted Cash Restricted cash represents $100 thousands and $50 thousand at December 31, 2022 and 2021, respectively, related to a collateral money market account maintained by the Company as collateral in connection with corporate credit cards with Silicon Valley Bank. The following table provides a reconciliation of cash, cash equivalents and restricted cash reported in the consolidated balance sheets to the same total reported in the consolidated statements of cash flows (in thousands): December 31, December 31, 2022 2021 Cash and cash equivalents $ 3,855 $ 22,765 Restricted cash 100 50 Total cash, cash equivalents, and restricted cash in the consolidated statement of cash flows $ 3,955 $ 22,815 Accounts Receivable The majority of the Company’s accounts receivable arise from direct product sales and sales of products under consignment arrangements, and have payment terms that generally require payment within 30 At December 31, 2022, the Company had one customer that accounted for 20.4% of the Company’s total accounts receivable. At December 31, 2022, the Company has reserved approximately $0.1 million related to the outstanding receivable balance related to this customer. Inventory The Company accounts for inventory at the lower of cost or net realizable value, where net realizable value is based on market prices less costs to sell. The Company establishes inventory reserves for obsolescence based upon specific identification of expired or unusable units with a corresponding provision included in cost of revenue. The allowance for excess and slow-moving inventory was $1.0 million and $0.8 million at December 31, 2022 and 2021, respectively. Property and Equipment, Net Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation of property and equipment is computed using the straight-line method over their estimated useful lives of five three Goodwill and Other 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. Finite-lived intangible assets primarily consist of developed technology and trademarks/tradenames and are being amortized on a straight-line basis over their estimated useful lives. See Note 8 for additional information. 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 group 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. The Company recorded an impairment to developed technology and IPR&D intangible assets for the year ended December 31, 2022, and recorded an impairment to goodwill and IPR&D for the year ended December 31, 2021, for further details see Note 8 and Note 9. Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance for deferred income tax assets is recorded when it is more likely than not that some portion or all of the deferred income tax assets will not be realized. The Company’s policy is to classify interest and penalties related to income taxes as income tax expense in the consolidated statements of operations. Foreign Currency When the local currency of the Company's foreign subsidiaries is the functional currency, all assets and liabilities are translated into United States dollars at the rate of exchange in effect at the balance sheet date. Income and expense items are translated at the weighted-average exchange rate prevailing during the period. The effects of foreign currency translation adjustments for these subsidiaries are deferred and reported in stockholders’ equity as a component of Accumulated Other Comprehensive Loss. The effects of foreign currency transactions denominated in a currency other than an entity's functional currency are included in Gain on foreign currency exchange in the Consolidated Statements of Operations. The Company does not hedge foreign currency translation risk in the net assets and income it reports from these sources. Revenue Recognition The Company recognizes revenue when it satisfies a performance obligation by transferring control of the promised goods or services to its customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. Product sales consist of a single performance obligation that the Company satisfies at a point in time. The Company recognizes product revenue when the following events have occurred: (a) the Company has transferred physical possession of the products, (b) the Company has a present right to payment, (c) the customer has legal title to the products, and (d) the customer bears significant risks and rewards of ownership of the products. For the Company’s L -B Taxes collected from customers and remitted to governmental authorities are accounted for on a net basis. Accordingly, such amounts are excluded from revenues. Amounts billed to customers related to shipping and handling are included in revenues. Shipping and handling costs related to revenue producing activities are included in cost of sales. Variable Consideration The Company records revenue from customers in an amount that reflects the transaction price it expects to be entitled to after transferring control of the goods. Customers and distributors of the L -B L -B Certain L -B Warranty The Company generally provides warranties against defects in materials and workmanship, and provides replacements at no charge to the customer, as long as the customer has notified the Company within 30 days of delivery and returns such products in accordance with the Company’s instructions. As they are considered assurance-type warranties, the Company does not account for them as separate performance obligations. Warranty reserve requirements are based on a specific assessment of the products sold with warranties where a customer asserts a claim for warranty or a product defect. For the vBloc product line, the Company has a 5-year Advertising Cost Advertising costs are expensed as incurred and totaled $6.8 million and $3.0 million for the years ended December 31, 2022 and 2021, respectively. Stock-Based Compensation The Company applies ASC 718 Compensation — Stock Compensation and accordingly records compensation expense for stock options over the vesting or service period using the fair value on the date of grant, as calculated by the Company using the Black-Scholes model. The Company’s stock-based compensation plans are more fully described in Note 16. Net Loss Per Share Basic net loss per share is computed by dividing net loss by the weighted-average number of common shares outstanding during the period, including the pre-funded warrants, see Note 13, that were reclassified from warrant liability to equity as a result of the reverse stock split. Diluted net loss per share is based on the weighted-average common shares outstanding during the period plus dilutive potential common shares calculated using the treasury stock method. Such potentially dilutive shares are excluded when the effect would be to reduce a net loss per share. For purposes of basic and diluted per share computations, loss from continuing operations and net loss are reduced by the down round adjustments for convertible preferred stock and warrants. 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: December 31, 2022 2021 Stock options 21,416 17,701 Unvested restricted stock units 4,530 34,227 Convertible preferred stock 10 10 Warrants 193,476 139,047 Concentration of Credit Risk, Interest Rate Risk and Foreign Currency Exchange Rate Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and cash equivalents, restricted cash and trade accounts receivable. Cash and cash equivalents are primarily deposited in demand and money market accounts. At times, such deposits may be in excess of insured limits. Investments in money market funds are not considered to be bank deposits and are not insured or guaranteed by the federal deposit insurance company or other government agency. These money market funds seek to preserve the value of the investment at $1.00 per share; however, it is possible to lose money investing in these funds. The Company has not experienced any losses on its deposits of cash and cash equivalents. To minimize the risk associated with trade accounts receivable, management maintains relationships with the Company’s customers that allow management to monitor current changes in business operations so the Company can respond as needed. Substantially all of the Company’s revenue is denominated in U.S. dollars. Only a small portion of revenue and expenses are denominated in foreign currencies, principally the Australian dollar and Euro for 2022 and 2021. The Company has not entered into any hedging contracts. Future fluctuations in the value of the U.S. dollar may affect the price competitiveness of the Company’s products outside the U.S. Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (referred to as an “exit price”). Fair value of an asset or liability considers assumptions that market participants would use in pricing the asset or liability, including consideration of non-performance risk. Assets and liabilities are categorized into a three-level fair value hierarchy based on valuation inputs used to determine fair value. Level 1 inputs are quoted prices in active markets for identical assets or liabilities. Level 2 inputs are observable, either directly or indirectly. Level 3 inputs are unobservable due to little or no corroborating market data. The carrying amounts of the Company’s financial instruments, including cash equivalents, accounts receivable, accounts payable and certain accrued and other liabilities approximate fair value due to their short-term maturities. Refer to Note 9 regarding the impairment of developed technology, goodwill and IPR&D, Note 10 regarding the fair value of debt instruments and Note 14 regarding fair value measurements and inputs of warrants. Recent Accounting Pronouncements New accounting standards adopted by the Company in 2021 are discussed below or in the related notes, where appropriate. In May 2021, the FASB issued Accounting Standards Update (“ASU”) No. 2021-04, Earnings Per Share (Topic 260), Debt – Modifications and Extinguishments (Subtopic 470-50), Compensation – Stock Compensation (Topic 718), and Derivatives and Hedging Contracts in Entity’s Own Equity (Subtopic 815-40). This update provides guidance to clarify and reduce diversity in an accounting for modifications or exchanges of freestanding equity-classified written call options (for example, warrants) that is not within the scope of another Topic. An entity should treat a modification of the terms or conditions or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange as an exchange of the original instrument for a new instrument. This update additionally provides further guidance on measuring the effect of a modification or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange on the basis of the substance of the transaction, in the same manner as if cash had been paid as consideration. This guidance is effective for the fiscal years and interim periods within those years beginning after December 15, 2021. Early adoption is permitted, including adoption in an interim period. The Company adopted this guidance early and the adoption did not have a material impact on the Company’s consolidated financial statements. In December 2019, the FASB issued authoritative guidance intended to simplify the accounting for income taxes: ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. This guidance eliminates certain exceptions to the general approach to the income tax accounting model and adds new guidance to reduce the complexity in accounting for income taxes. The adoption of this guidance on January 1, 2021, did not have a material impact on the Company’s consolidated financial statements. New accounting standards not yet adopted are discussed below. In June 2016, the FASB issued ASU 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 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. Various other accounting standards and interpretations have been issued during 2022 effective dates and effective dates subsequent to December 31, 2021. The Company has evaluated the recently issued accounting pronouncements that are currently effective or will be effective in 2022 and believe that none of them have had or will have a material effect on the Company’s financial position, results of operations or cash flows. |
Liquidity and Management Plans
Liquidity and Management Plans | 12 Months Ended |
Dec. 31, 2022 | |
Liquidity and Management's Plans | |
Liquidity and Management's Plans | ( 5) Liquidity and Management’s Plans The Company currently does not generate revenue sufficient to offset operating costs and anticipates such shortfalls to continue, partially due to the unpredictability of COVID-19, which has resulted and may continue to result in a slow-down of elective surgeries and restrictions in some locations, and supply chain disruptions. As of December 31, 2022, the Company had net working capital of approximately $2.4 million, primarily due to cash and cash equivalents and restricted cash of $4.0 million. The Company’s principal source of liquidity as of December 31, 2022, consisted of approximately $4.0 million of cash and cash equivalents and restricted cash, and $2.2 million of accounts receivable. On February 8, 2023, the Company completed a public offering, which the Company received approximately $9.4 million in cash and cash equivalents after deducting underwriting expenses, commissions and offering expenses. Based on our available cash resources, we may not have sufficient cash on hand to fund our current operations for more than 12 months from the date of filing this Form 10-K. This condition raises substantial doubt about our ability to continue as a going concern. The Company’s anticipated operations include plans to (i) 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, (ii) introduce to the market place ReShapeCare and ReShape Marketplace as an extension, (iii) marketing efforts to increase brand recognition, create customer awareness and increase the patient demand, (iv) continue development of the DBSN device, (v) seek opportunities to leverage our intellectual property portfolio and custom development services to provide third-party sales and licensing opportunities, and (vi) explore and capitalize on synergistic opportunities to expand our portfolio and offer future minimally invasive treatments and therapies in the obesity continuum of care, including Lap-Band 2.0. 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, clinical and product development activities. The Company has incurred significant net losses and negative cash flows from operations since inception, and as a result has an accumulated deficit of approximately $624.2 million. The Company also expects to incur a net loss and negative cash flows from operations for 2023. The Company may be required to raise additional capital, however, there can be no assurance as to 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. COVID-19 and Supply Chain Disruptions Risk and Uncertainties The impact of the COVID-19 outbreak has subsided substantially in the U.S. but continues to result in reduced activity levels outside of the U.S., such as continued restrictions on travel and business operations and advising or requiring individuals to limit or forego their time outside of their homes or places of business. In response to the global supply chain instability and inflationary cost increases, we continue to take action to minimize, as much as possible, any potential adverse impacts by working closely with our suppliers to closely monitor the availability of raw materials, lead times, and freight carrier availability. We expect global supply chain instability will continue to have an impact on our business, but to date that has not been significant to our financial performance. The consequences of global supply chain instability, inflationary cost increases and the pandemic, and their adverse impact to the global economy, continue to evolve. Accordingly, the significance of the future impact to our business and financial. |
Supplemental Balance Sheet Info
Supplemental Balance Sheet Information (as Restated) | 12 Months Ended |
Dec. 31, 2022 | |
Supplemental Balance Sheet Information (as Restated) | |
Supplemental Balance Sheet Information (as Restated) | (6) Supplemental Balance Sheet Information (As Restated) Inventory December 31, December 31, 2022 2021 Raw materials $ 832 $ 829 Sub-assemblies 864 682 Finished goods 1,915 1,492 Total inventory $ 3,611 $ 3,003 Prepaid expenses and other current assets: December 31, December 31, 2022 2021 As Restated Prepaid insurance $ 78 $ 419 Prepaid advertising and marketing 3 698 Other current assets 84 188 Total prepaid expenses and other current assets $ 165 $ 1,305 Accrued and other liabilities: December 31, December 31, 2022 2021 As Restated Payroll and benefits $ 1,829 $ 1,527 Accrued legal settlements 1,775 180 Customer deposits 510 549 Taxes 119 326 Accrued insurance premium — 301 Accrued professional 316 300 Other liabilities 491 185 Total accrued and other liabilities $ 5,040 $ 3,368 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2022 | |
Property and Equipment | |
Property and Equipment | (7) Property and Equipment Property and equipment consist of the following: December 31, 2022 2021 Machinery and equipment $ 582 $ 955 Furniture and equipment 27 38 Computer hardware and software 136 135 Tooling and molds 199 236 Leasehold improvements 19 23 Construction in progress 66 407 1,029 1,794 Less accumulated depreciation and amortization (331) (340) Property and equipment, net $ 698 $ 1,454 Depreciation expense for the years ended December 31, 2022 and 2021, was approximately $330 thousand and $232 thousand, respectively. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (as Restated) | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets (as Restated) | |
Goodwill and Intangible Assets (as Restated) | (8) Goodwill and Intangible Assets (As Restated) The consolidated intangible assets consist of the following: December 31, 2022 Weighted Average Useful Life (years) Gross Carrying Amount Accumulated Amortization Net Book Value Finite-lived intangible assets: Developed technology 10.0 $ 5,989 $ (5,805) $ 184 Trademarks/Tradenames 10.0 462 (386) 76 Total $ 6,451 $ (6,191) $ 260 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 The gross amount and accumulated impairment loss of indefinite-lived intangible assets are as follows (in thousands): December 31, 2022 2021 Gross amount $ 20,721 $ 20,721 Accumulated impairment loss (20,721) (13,774) Indefinite-lived intangible assets, net $ — $ 6,947 Amortization expense for the years ended December 31, 2022 and 2021, was approximately $1.8 million and $1.7 million, respectively. Estimated amortization expense for each of the years ending December 31 is as follows: Year ending December 31, 2023 $ 44 2024 44 2025 44 2026 44 2027 44 Thereafter 40 $ 260 In connection with the merger with Obalon, ReShape recorded $23.5 million of goodwill which has been fully impaired, see Note 12 for details of the acquisition and Note 9 for details of the impairment. |
Impairment of Intangible Assets
Impairment of Intangible Assets and Goodwill (as Restated) | 12 Months Ended |
Dec. 31, 2022 | |
Impairment of Intangible Assets and Goodwill (as Restated) | |
Impairment of Intangible Assets and Goodwill (as Restated) | (9) Impairment of Intangible Assets and Goodwill (As Restated) As of December 31, 2022, the Company determined a triggering event occurred due to the decline in the Company’s market capitalization, and as such, the Company performed an impairment analysis of the long-lived assets. It was determined the developed technology related to the Obalon Balloon was fully impaired, as the Company has not been able to start up production or find a partner to manufacture the Obalon Balloon system. Based on this the Company has no current projections for revenues related to the Obalon Balloon and has fully impaired the asset of approximately $2.4 million. Additionally, due to the continuance of COVID-19, the Company has revised the near-term projected revenues related to the Lap-Band asset group and has recognized an impairment charge to both the developed technology and tradenames of approximately $8.4 million and $0.5 million, respectively. The fair value of the Lap-Band developed technology was estimated using an income approach using Level 3 assumptions which included discounting projected future net cash flows to their present value, with a discount rate of 17.9%. The Company also determined a triggering event occurred, as the Company elected to stop the clinical trials for the ReShape Vest and was closing out the previous trial that occurred, as significant additional clinical work and cost would be required to achieve regulatory approval. Additionally, the Company currently does not plan to pursue the development of the ReShape Vest. As such, the Company determined the carrying value of the IPR&D asset and related trademarks were impaired and recognized non-cash impairment charge of approximately $6.9 million and $0.5 million, respectively, on the consolidated balance sheet as of December 31, 2022, which reduced the value of these assets to zero. As of December 31, 2021, the Company determined a triggering event occurred due to the decline in the Company’s market capitalization, coupled with the delayed effects of the COVID-19 pandemic, and as such, the Company performed an impairment analysis of IPR&D. Due to continued delays in the clinical trials experienced during the COVID-19 restrictions, the Company revised its expectations of when revenues would commence for the ReShape Vest, thus reducing the near-term future net cash flows related to the ReShape Vest. As a result, the Company performed a quantitative impairment analysis and recorded a one-time nonrecurring impairment charge As of December 31, 2021, the Company determined due to a decrease in market capitalization, that it is more likely than not that the fair value of net assets are below their carrying amounts and, therefore, the Company performed a goodwill impairment test. The Company estimated the fair value of the goodwill using a combination of the income and market approach, and then the carrying amount including the goodwill to the fair value. Since the fair value was less than the carrying amount, we calculated the goodwill impairment as the difference between the fair value and carrying value. As the difference was greater than the carrying amount of the goodwill the Company impaired the entire balance of $23.5 million. |
Debt
Debt | 12 Months Ended |
Dec. 31, 2022 | |
Debt | |
Debt | (10) 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, has certified that the current economic uncertainty made the loan request necessary to support the ongoing operations of the Company. This certification further requires the Company to take into account our 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 intends to use proceeds from the PPP Loan primarily for payroll costs, rent and utilities. The PPP Loan has a 1.00% interest rate per annum, matures on April 24, 2022 and is subject to the terms and conditions applicable to loans administered by the SBA under the PPP. Under the terms of PPP, all or certain amounts of the PPP Loan may be forgiven if they are used for qualifying expenses as described in the CARES Act. 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, the PPP Loan has been forgiven in full including all interest incurred. Under the provisions of the CARES Act, the Company is eligible for a refundable employee retention credit subject to certain criteria. The Company recognized a $0.5 million employee recognition credit during the year ended December 31, 2021. Credit Agreement On January 19, 2021, the Company and the Lender entered into an amendment to the credit agreement that increased the amount available under delayed draw term loans by $1.0 million, which was used to fund the $1.0 million escrow fund securing the termination fee under the Merger Agreement and issued an additional 20,000 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, 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. 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 will be 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 14. The Company used some of the proceeds from this transaction to pay off the $10.5 million of debt outstanding under the credit agreement. At December 31, 2021, there was no outstanding amount under the credit agreement. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2022 | |
Leases | |
Leases | (11) Leases The Company had noncancelable operating leases for office and warehouse space in San Clemente and Carlsbad, California, as well as and noncancelable operating leases for certain office equipment that expire at various dates through 2022. On March 13, 2023 we entered into a lease for approximately 5,038 square feet at 18 Technology Drive, Suite 110, Irvine, California 92618 and intend to relocate our principal executive offices from our current San Clemente, California location to the Irvine, California location. The Irvine California 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 and the effects of any lease modifications have not been material. 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. The Company determines the lease term as the noncancelable period of the lease, and may include options to extend or terminated the lease when reasonably certain that the Company will exercise that option. Leases with a term of 12 months or less are not recognized on the balance sheet. The Company uses its incremental borrowing rate based on the information available at lease commencement in determining the present value of unpaid lease payments. Right-of-use assets also include any lease payments made at or before lease commencement and any initial direct costs incurred, and exclude any lease incentives received. Operating lease costs for the years ended December 31, 2022 and 2021, were $0.7 million and $0.6 million, respectively. Variable lease costs were not material. Supplemental information related to operating leases is as follows: December 31, December 31, Balance Sheet information 2022 2021 Operating lease ROU assets $ 171 $ 266 Operating lease liabilities, current portion $ 171 $ 279 Total operating lease liabilities $ 171 $ 279 Cash flow information for the year ended December 31, 2022 2021 Cash paid for amounts included in the measurement of operating leases liabilities $ 560 $ 565 Maturities of operating lease liabilities at December 31, 2022 were as follows: 2023 174 Total lease payments 174 Less: imputed interest 3 Total lease liabilities $ 171 Weighted-average remaining lease term at end of period (in years) 0.5 Weighted-average discount rate at end of period 5.1 % |
Acquisition (as Restated)
Acquisition (as Restated) | 12 Months Ended |
Dec. 31, 2022 | |
Acquisition (as Restated) | |
Acquisition (as Restated) | (12) Acquisition (As Restated) On June 15, 2021, the Company completed the 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 66,801 shares of common stock valued at $30.6 million at the closing market price of the day of merger and the cancellation of 53,607 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. Acquisition related costs of $2.3 million were recorded in general and administrative expense for the year ended December 31, 2021. 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 preliminary 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: (As Restated) Current assets $ 5,887 Property and equipment, net 796 Right-of-use assets 335 Goodwill 23,463 Developed technology 2,730 Liabilities assumed (2,650) Total purchase price 30,561 Less: cash acquired (5,207) Total purchase price, net of cash acquired $ 25,354 As part of the merger, the Company assumed warrants agreements previously entered into by Obalon that contained a fundamental transaction provision that provide the holders a cash payment based on a Black-Scholes valuation of the warrants. This clause was valid for 30 days subsequent to the date of the transaction. The merger was considered a fundamental transaction provision that allowed the holder to redeem the warrants for cash. The Company performed a preliminary valuation of these warrants and recorded a liability at the time of the merger of $2.0 million. The Company completed its valuation of these warrants which resulted in a liability for the warrants of $1.3 million, the decrease of $0.7 million, to the liability 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 13 and 14 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 impaired the goodwill due to the decline in market capitalization. For further details see Note 9. Obalon’s results of operations have been included in our financial statements for the periods subsequent to the consummation of the Merger on June 15, 2021. Obalon contributed no revenue and a net loss of $2.0 million, in addition to the $23.5 million of loss on impairment of goodwill, for the period from June 16, 2021 through December 31, 2021. Pro Forma Results of Operation (Unaudited) The following table summarizes the results of operations of the above mentioned acquisition from their respective dates of acquisition included in our consolidated results of operations and the unaudited pro forma results of operations of the combined entity had the date of acquisition been January 1, 2021: Revenue Net Loss (As Restated) (Unaudited) (Unaudited) Combined entity: Supplemental pro forma from January 1, 2021 to December 31, 2021 $ 13,432 $ (71,178) The information present above is for illustrative purpose only and is not necessarily indicative or results that would have been achieved if the acquisitions had occurred as of the beginning of our 2021 reporting period. |
Equity
Equity | 12 Months Ended |
Dec. 31, 2022 | |
Equity | |
Equity | (13) Equity The Company may issue preferred stock, common stock, or both, in connection with underwritten public offerings, registered direct offerings, private placements or business acquisitions. Such issuances of equity typically include the issuance or sale of warrants to purchase common stock. Certain issuances of convertible preferred stock and warrants may contain anti-dilutive features apart from customary adjustments for splits and reverse splits of common stock (collectively, “down round features”). When a series of convertible preferred stock contains this non-standard down round feature, the Company is required to adjust the conversion price in the event of future stock sales at a lower unit price. When warrants issued in connection with an equity transaction contain, or are amended to contain, this non-standard down round feature, the Company is required to adjust the exercise price upon the issuance of any shares of common stock or securities convertible into shares of common stock below the then-existing exercise price and evaluate and account for the value attributable to the reduced warrant exercise price. In the event down round adjustments are triggered, the values attributable to the adjustment to the convertible preferred stock conversion price and warrant exercise price are recorded as an increase to additional paid-in capital and increase to accumulated deficit. All series of the Company’s convertible preferred stock are classified in stockholders’ equity, including those with the down round feature, when applicable to the equity transaction. Warrants to purchase common stock are classified in stockholders’ equity, including those issued with the down round feature, as they are both indexed to the Company’s own stock and meet the scope exception in ASC 815 “Derivatives and Hedging.” The Company had the following equity transactions during the years ended December 31, 2022 and 2021: November 2022 Sale of Common Stock On November 8, 2022, the Company entered into a securities purchase agreement with an existing accredited investor, to issue and sell 47,851 shares of common stock, 2,500 shares of Series D Mirroring Preferred stock for $0.001 per share, which automatically terminated subsequent to the shareholder meeting on December 14, 2022, and prefunded warrants to purchase an aggregate of 9,841 shares of common stock. Each share of common stock was sold at a price of $13.00 per share, and each pre-funded warrant was sold at an offering price of $12.95 per share underlying such pre-funded warrants, for aggregate gross proceeds of $750,000 before deducting the placement agent’s fees and offering expenses. Under the purchase agreement, the Company also agreed to issue and sell to the investor in a concurrent private placement warrants to purchase an aggregate of 57,693 shares of common stock. The Company intends to use the remainder of the net proceeds for commercial growth, working capital and general corporate purposes. In connection with the offering, the Company also entered into a warrant amendment agreement with the investor. Under the warrant amendment agreement, the Company agreed to amend certain existing warrants to purchase up to 106,963 shares of common stock that were previously issued to the investor, with an exercise price of $33.33 per share and expiration dates of June 2026 and December 2029, in consideration of their purchase of securities in the offering as follows: (i) lower the exercise price of the existing warrants to $15.00 per share, (ii) provide the existing warrants as amended, will not be exercisable until six months following the closing date of the offering, and (iii) extend the expiration date of the existing warrants with an expiration date of June 2026 by five 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 74,773 shares of common stock. In consideration for the immediate exercise of the existing warrants for cash, the exercising holders received new unregistered warrants to purchase up to an aggregate of 74,773 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 32,190 remaining unexercised warrants from $300.00 to $33.33 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 see Note 14 below. The gross proceeds to the Company from the exercise was approximately $2.5 million, prior to deducting warrant inducement agent fees 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 750 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 will become unrestricted six months after the agreement date which is when the contract term ends. The value of the securities were included as a component of prepaid expenses and is amortized over the contract term. July 2021 Exchange of Warrants for Common Stock On July 16, 2021, the Company entered into an exchange agreement (the “Exchange Agreement”) with existing 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 Therapeutics, Inc. and ReShape Lifesciences Inc. 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 10,098 shares of common stock, which was calculated by dividing the Black Scholes Payment by $201.90, which was equal to 95% of the closing market price of the Company’s common stock on the Nasdaq on July 16, 2021 and (b) new warrants to purchase up to a total of 8,000 shares of common stock at an exercise price of $201.90 with a term of five years. For further details on the warrants see Note 14 below. June 2021 Exercises of Warrants for Common Stock On June 28, 2021, the Company entered into a warrant exercise agreement with existing investors to exercise certain outstanding warrants to purchase up to an aggregate of 158,588 shares of the Company’s common stock, which 142,617 of the shares were issued in July 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 118,941 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 $4.69 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 $300.00, 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 14 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 10 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 4,000 shares of common stock to investors, and on June 21, 2021, the Company issued 3,754 shares of common stock to investors, 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. Common Stock Issued Related to Stock Awards and Options Restricted Stock Units The Company issued restricted stock units (“RSUs”) to certain members of the management and Board of Directors. During the year ended December 31, 2022, the Company issued 50,131 shares of common stock subject to the vesting of the awards, of which 28,769 shares of common stock were related to bonus in-leu of cash. During the year ended December 31, 2021, the Company issued 37,986 shares of common stock subject to the vesting of the awards. For further details see Note 14. Exercise of Stock Options There were no exercises of stock options during the year ended December 31, 2022. On September 15, 2021, the Company issued 1,454 shares of common stock related to the exercise of previous Obalon employees exercising stock option awards. The Company received $0.2 million related to this exercise. On July 13, 2021, the Company issued 364 shares of common stock related to the exercise of previous Obalon employees exercising stock option awards. The Company received $42 thousand related to this exercise. On June 18, 2021, the Company issued 1,838 shares of common stock related to the exercise of previous Obalon employees exercising stock option awards. The Company received $0.2 million related to this exercise. Series C Convertible Preferred Stock The Series C convertible stock has a liquidation preference of $274.88 per share. Holders of the Series C convertible preferred stock have the right to convert their shares into shares of common stock instead of receiving the liquidation preference. The Series C convertible preferred stock is entitled to dividends on an as-if-converted-to-common stock basis if such dividends are paid on shares of common stock. In general, the holders of the Series C convertible preferred stock do not have voting rights. |
Warrants
Warrants | 12 Months Ended |
Dec. 31, 2022 | |
Warrants. | |
Warrants | (14) Warrants The Company’s grants of warrants to purchase common stock are primarily in connection with equity and debt financings. See Note 13 for additional information about equity financings and the related issuance of warrants. Warrant activity was as follows: Shares Balance December 31, 2020 161,050 Obtained due to merger 17,505 (1) Issued 138,215 (2) Exercised (177,723) (3) Cancelled — Balance December 31, 2021 139,047 Issued 145,192 (4) Exercised (84,614) (5) Cancelled (6,149) Balance December 31, 2022 193,476 (1) Obalon’s warrants outstanding at the time of the merger with the 1 -for-3 reverse stock split adjustment. In addition, this amount includes, 10,098 warrants converted into common shares in July of 2021, see Note 13 for further details. (2) Warrants issued in 2021 includes 11,274 of Series G warrants and 126,941 of warrants issued to various institutional investors. (3) Warrants exercised in 2021 includes 37,581 Series A warrants at an exercise price of $234.00 per share, 1,285 Series C pre-funded warrants at an exercise price of $10.50 per share, 37,581 Series E warrants at an exercise price of $300.00 per share, 7,754 Series F pre-funded warrants at an exercise price of $10.50 per share, and 83,428 Series G warrants with exercise prices ranging from $288.50 per share to $300.00 per share, and an exchange of 10,098 warrants for common stock. (4) Warrants issued in 2022 includes 74,773 reload warrants, 57,693 common stock purchase warrants, 2,885 representative’s warrants, and 9,841 pre-funded warrants. (5) Warrants exercised in 2022 includes 74,773 reload warrants at an exercise price of $33.33 per share, and 9,841 pre-funded warrants at an exercise price of $0.05 per share. Warrant Assumptions – 2022 Warrants Issued The following table provides the assumptions used to calculate the fair value of the new warrants issued during 2022, using a Black-Scholes model: Warrants Strike Price Volatility Remaining Life Risk Free Rate Reload warrants - June 2022 74,773 $ 33.33 64.8 % 7.5 3.32 % Reload warrants - November 2022 57,693 $ 15.00 84.3 % 5.5 4.21 % Representative's warrants 2,885 $ 15.00 84.3 % 5.0 4.23 % Pre-funded warrants 9,841 $ 0.05 84.3 % 5.5 4.21 % Warrant Assumptions – 2021 Warrants Issued The following table provides the assumptions used to calculate the fair value of the Series G warrants issued during 2021, using a Black-Scholes model: Warrants Strike Price Volatility Remaining Life Risk Free Rate January 19, 2021 11,274 $ 310.50 97.1 % 5.0 0.45 % June 28, 2021 118,941 $ 300.00 97.6 % 5.0 0.9 % July 16, 2021 8,000 $ 202.00 157.7 % 5.0 0.79 % |
Revenue Disaggregation and Oper
Revenue Disaggregation and Operating Segments | 12 Months Ended |
Dec. 31, 2022 | |
Revenue Disaggregation and Operating Segments | |
Revenue Disaggregation and Operating Segments | (15) Revenue Disaggregation and Operating Segments The following table presents the Company’s revenue disaggregated by geography: Year Ended December 31, 2022 2021 United States $ 9,230 $ 10,297 Australia 688 1,039 Europe 1,252 2,127 Rest of world 70 137 Total revenue $ 11,240 $ 13,600 Operating Segments The Company conducts operations worldwide and is managed in the following geographical regions: United States, Australia, Europe and Rest of World (primarily in the Middle East). All regions sell the Lap-Band product line, which consisted of nearly all our revenue and gross profit for the years ended December 31, 2022 and 2021. During the second half of 2020 the Company launched ReShapeCare, which had minimal revenue for the years ended December 31, 2022 and 2021. The Company anticipates generating more ReShapeCare revenue during 2022. There was no revenue or gross profit recorded for the DBSN device in 2022 or 2021 because these two products are still in the development stage. During June 2021, the Company merged with Obalon, which had no revenues for the years ended December 31, 2022 and 2021. The Company has one operating segment based on the financial information provided to the Chief Operating Decision Maker (the Chief Executive Officer, or “CODM”). The Company’s CODM evaluates segment performance based on revenue and gross profit at the consolidated level. The CODM does review revenue based on domestic and international. As such, the Company believes reporting revenue based on territory is useful to the user of the financial statements. |
Stock-based Compensation (as Re
Stock-based Compensation (as Restated) | 12 Months Ended |
Dec. 31, 2022 | |
Stock-based Compensation (as Restated) | |
Stock-based Compensation (as Restated) | (16) Stock-based Compensation(As Restated) The ReShape Lifesciences Inc. 2022 Equity Incentive Plan (the “Plan”) became effective December 14, 2022, and provides for the grant of stock options or other stock-based awards to employees, officers, non-employee directors and outside consultants of the Company. The maximum number of shares of common stock that will be available for issuance under this Plan was originally 105,000 shares; provided however, that the aggregate number of shares that may be issued under all awards under the Plan will automatically increase on an annual basis on the first day of each year beginning in 2023 such that the aggregate number of shares that may be issued under all awards under this Plan equals 15% of the total number of shares of Common Stock, on a converted basis, on the last day of the immediately preceding fiscal year. Under the 2003 Stock Incentive Plan, as amended in 2018 (the “Prior Plan”), as of January 1, 2022, there were 82,142 shares available under the Prior Plan and there were 30,215 shares of common stock available for issuance under the Prior Plan. The Plan is administered by the committee, which determines the types of awards to be granted, including the number of shares subject to the awards, the exercise price and the vesting schedule. Options granted under the Plan expire no later than ten years from the date of grant. The exercise price of each option may not be less than 100% of the fair market value of the common stock at the date of grant, except if an incentive stock option is granted to a Plan participant possessing more than 10% of the Company’s common stock, as defined by the Plan, the exercise price may not be less than 110% of the fair value of the common stock at the date of grant. Employee stock options generally vest over four years. Stock Options A summary of the status of the Company’s stock options 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, 2020 1 $ 106,534,131.00 $ — Vested options obtained due to merger 7,329 1,794.00 Options granted 15,814 181.00 Options exercised (3,654) 114.00 Options cancelled (1,788) 51,261.50 Outstanding at December 31, 2021 17,702 398.57 $ — Options granted 11,201 59.00 Options exercised — — Options cancelled (7,487) 139.16 Outstanding at December 31, 2022 21,416 311.65 7.2 $ — Exercisable at December 31, 2022 14,659 412.85 6.7 — Vested and expected to vest at December 31, 2022 21,416 311.65 7.2 — As of December 31, 2022, stock options under the Plan that were outstanding exercisable 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 recognizes 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 Expected Volatility Risk-free Interest Rate Expected Dividend Yield The Company’s weighted average assumptions used to estimate fair value of stock options granted were as follows: Year Ended December 31, 2022 2021 As Restated Risk-free interest rate 2.67% 1.19% Expected term (in years) 6.25 6.25 Expected dividend yield 0% 0% Expected volatility 80.40% 82.68% Restricted Stock Units A summary of the Company’s unvested RSUs award activity for the year ended December 31, 2022, were as follows: Weighted Average Grant Date Shares Fair Value Unvested RSUs at December 31, 2020 — $ — Granted 72,212 218.00 Vested (37,986) 218.00 Cancelled/Forfeited — — Unvested RSUs at December 31, 2021 34,226 218.00 Granted 32,777 16.92 Vested (1) (50,131) 97.44 Cancelled/Forfeited (12,342) 189.88 Non-vested RSUs at September 30, 2022 4,530 174.01 (1) At December 31, 2022, there were 278 shares of common stock related to RSU awards that have vested and the shares were not released to the participants until January of 2023. The fair value of each RSU is the closing 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 RSUs at December 31, 2022 was $0.7 million and is expected to be recognized over a period of 1.6 years. Compensation expense related to stock options was recognized as follows: Year Ended December 31, 2022 2021 As Restated Sales and marketing $ 280 $ 949 General and administrative 1,494 10,126 Research and development 313 1,152 Total stock-based compensation expense $ 2,087 $ 12,227 |
Income Taxes (as Restated)
Income Taxes (as Restated) | 12 Months Ended |
Dec. 31, 2022 | |
Income Taxes (as Restated) | |
Income Taxes (as Restated) | (17) Income Taxes (As Restated) Income tax expense (benefit) consists of the following: Year ended December 31, 2022 2021 Deferred: As Restated Federal $ (293) $ (218) State (76) (30) Foreign (54) — Deferred income tax benefit (423) (248) Current: Federal 30 — State 9 11 Foreign 4 (37) Total income tax benefit, net $ (380) $ (274) A reconciliation of the U.S. federal statutory income tax rate to the Company’s effective income tax rate is as follows: Year ended December 31, 2022 2021 As Restated Income tax benefit at U.S. federal statutory rate 21.0 % 21.0 % State income tax benefit, net of federal benefit 3.8 % 3.3 % Stock warrant valuation — % (2.0) % Goodwill impairment — % (7.8) % Stock-based compensation — % (12.0) % Other permanent differences (1.9) % (3.8) % Change in state tax rate 0.3 % (1.0) % Foreign rate differential (0.2) % — % Net operating loss true up — % 0.3 % Other adjustments 2.8 % 0.3 % Change in valuation allowance (25.0) % 2.1 % Effective income tax rate 0.8 % 0.4 % A reconciliation of the beginning and ending amount of uncertain tax positions are as follows: 2022 2021 As Restated Uncertain gross tax positions, January 1 $ 1,052 $ — Current year tax positions — — Increase in prior year tax positions — 1,052 Settlements — — Lapse of statute of limitations — — Uncertain gross tax positions, December 31 $ 1,052 $ 1,052 The components of deferred tax assets and liabilities are as follows: December 31, 2022 2021 Deferred tax assets: As Restated Start-up costs $ 1,137 $ 1,225 Capitalized research and development costs 272 408 Reserves and accruals 1,157 1,679 Property and equipment — — Intangible assets 4,597 — Research and development credit 2,492 2,492 Lease liability 43 74 Net operating loss carryforwards 63,424 55,725 State and local taxes 2 2 Total gross deferred tax assets 73,124 61,605 Valuation allowance (72,945) (61,231) Deferred tax assets, net of valuation allowance 179 374 Property and equipment (80) (23) Intangible assets — (648) Operating lease right-of-use assets (43) (70) Total gross deferred tax liabilities (123) (741) Deferred income taxes, net $ 56 $ (367) In assessing the realization of deferred tax assets, management 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 and projections of losses in future periods, the Company provided a valuation allowance at both December 31, 2022 and 2021. The remaining net deferred tax asset at December 31, 2022 is the remaining balance of the Netherlands net operating loss. A valuation allowance is not applicable to this entity, as they historically produce income and utilize their net operating loss carryforward. The deferred tax liability at December 31, 2021 is the result of the deferred tax liability associated with the indefinite-lived intangible asset less the deferred tax asset associated with U.S. federal net operating loss that do not expire. In 2022, the indefinite-lived intangible asset became fully impaired. The Company has a policy that NOL’s are shown gross with valuation allowances with respect to IRC 382 limitations. As of December 31, 2022 and 2021, the Company had U.S. federal net operating loss carryforwards of $207.9 million and $182.0 million, respectively. Of the total U.S. federal net operating loss carryforwards at December 31, 2022, $6.3 million is subject to a 20 year carryover period and begin expiring in 2023. Losses generated beginning in 2018 will carryover indefinitely. The Company had state net operating loss carryforwards of $329.1 million and $280.7 million at December 31, 2022 and 2021, respectively and had foreign net operating loss carryforwards of $0.2 million at both December 31, 2022 and 2021. Net operating loss carryforwards of the Company are subject to review and possible adjustment by the taxing authorities. With certain exceptions (e.g. the net operating loss carryforwards), the Company is no longer subject to U.S. federal, state or local examinations by tax authorities for years prior to 2016. There are no tax examinations currently in progress. The Company’s ability to utilize its net operating loss carryforwards, tax credits, and built-in items of deduction, including capitalized start-up costs and research and development costs, has been, and may continue to be substantially limited due to ownership changes. These ownership changes limit the amount of net operating loss carryforwards, credits and built-in items of deduction that can be utilized annually to offset future taxable income. In general, an ownership change, as defined in IRC Section 382, results from a transaction or series of transactions over a three-year period resulting in an ownership change of more than 50% of the outstanding stock of a company by certain stockholders or public groups. Due to the valuation allowance against deferred tax assets at December 31, 2022, the net effect of any further limitation will have no impact on results of operations. In 2021, the Company completed an IRC Section 382 review and determined that ownership changes had occurred, which resulted in the determination that $82.5 million and $91.0 million of U.S. federal and state net operating losses, respectively would expire unused. Additionally, it was determined that $3.4 million of U.S. federal research and development credits would also expire unused. Due to the valuation allowance against deferred tax assets at December 31, 2021, the net effect of this, and any further, limitation will have no impact on results of operations. These are not included in the gross benefit of the net operating losses, presented in the table above. The Company has adopted accounting standards which prescribe a recognition threshold and measurement attribute for the financial statement recognition and measurement of uncertain tax positions taken or expected to be taken in a company’s income tax return, and also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. The Company had no amounts of unrecognized tax benefits that, if recognized, would affect its effective income tax rate for the years ended December 31, 2022 and 2021. The Company’s policy is to classify interest and penalties related to income tax expense as tax expense. As of December 31, 2022, the Company had no amount accrued for the payment of interest and penalties related to unrecognized tax benefits. The Inflation Reduction Act (IRA) was enacted on August 16, 2022 and includes a new corporate alternative minimum tax based on book income, an excise tax on stock buybacks, and other items such as tax incentives for energy and climate initiatives. There is no impact to the Company at this time, however this may change depending on each year’s differing facts and activities. The Company will continue to monitor this over time. |
Commitment and Contingencies
Commitment and Contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitment and Contingencies | |
Commitment and Contingencies | (18) Commitments and Contingencies Employee Arrangements and Other Compensation Certain members of management are entitled to severance benefits payable upon termination following a change in control, which would approximate $0.8 million at December 31, 2022. The Company also has agreements with certain employees to pay bonuses based on targeted performance criteria. As of December 31, 2022 and 2021, approximately $0.3 million and $0.9 million, respectively, was accrued for performance bonuses, which is included in accrued liabilities in the consolidated balance sheets. Purchase Commitments The Company generally purchases its products and accessories from a limited group of third-party suppliers through purchase orders. The Company had $2.9 million of purchase commitments as of December 31, 2022, for which the Company has not received the goods or services and which are expected to be purchased primarily within one year. These purchase commitments were made to secure better pricing and to ensure the Company will have the necessary inventory to meet anticipated near term demand. Although open purchase orders are considered enforceable and legally binding, the Company may be able to cancel, reschedule, or adjust requirements prior to supplier fulfillment. 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 seeks reimbursement of Cowen’s attorneys’ fees and interest in connection with its claim. On December 6, 2022, the Supreme Court of the State of New York ruled 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. The Company has accrued the $1.35 million, for the ruling and $0.2 million, of accrued interest at December 31, 2022. On August 18, 2021, H.C. Wainwright & Co., LLC 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 alleges that Wainwright is 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 alleges 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 seeks 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 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 could have a material adverse effect on the Company’s business, operating results or financial condition. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2022 | |
Subsequent Events | |
Subsequent Events | (19) Subsequent Events The Company considers events or transactions that occur after the balance sheet date but prior to the issuance of the financial statements to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure. The Company evaluated all subsequent events and determined that there are no material recognized or unrecognized subsequent events requiring disclosure, except as described below. On March 13, 2023 we entered into a lease for approximately 5,038 square feet at 18 Technology Drive, Suite 110, Irvine, California 92618 and intend to relocate our principal executive offices from our current San Clemente, California location to the Irvine, California location. The Irvine California lease has a term of 36 months commencing on May 1, 2023. Silicon Valley Bank (SVB) was closed on March 10, 2023, by the California Department of Financial Protection and Innovation, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect depositors, the FDIC transferred all the deposits and substantially all of the assets of SVB to Silicon Valley Bridge Bank, N.A., a newly formed bridge bank that will be operated by the FDIC as it markets the institution to potential bidders. On March 12, 2023, the Department of the Treasury, Federal Reserve, and FDIC (collectively, the Agencies) announced that they were invoking the Systemic Risk Exception to the Federal Deposit Insurance Act to permit the FDIC to take action to fully protect all depositors of SVB, regardless of their deposit insurance coverage. In addition, the Agencies also announced that SVB depositors would have access to all their money starting March 13, 2023. On March 10, 2023, the Company held approximately $9.7 million of insured and uninsured deposits at SVB. As of April 11, 2023, the Company transferred funds of approximately $7.0 million to Bank of America and $1.4 million remains deposited at SVB. 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 Gross proceeds, before deducting underwriting discounts and commissions and estimated offering expenses, are approximately $10.2 million. The Company intends to use 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. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Summary of Significant Accounting Policies | |
Basis of Presentation | Basis of Presentation The Company has prepared the accompanying consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”). |
Reverse Stock Splits | On December 23, 2022, at the commencement of trading, the Company effected a 1 On June 15, 2021, and immediately prior to the closing of the merger, the Company effected a 1 |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany transactions and accounts have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. |
Acquisition | 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 on June 15, 2021, with Obalon, 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, for further details see Note 12. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers highly liquid investments generally with maturities of 90 days or less when purchased to be cash equivalents. Cash equivalents are stated at cost, which approximates market value. The Company’s cash equivalents are primarily in money market funds and certificates of deposit. The Company deposits its cash and cash equivalents in high-quality credit institutions. |
Restricted Cash | Restricted Cash Restricted cash represents $100 thousands and $50 thousand at December 31, 2022 and 2021, respectively, related to a collateral money market account maintained by the Company as collateral in connection with corporate credit cards with Silicon Valley Bank. The following table provides a reconciliation of cash, cash equivalents and restricted cash reported in the consolidated balance sheets to the same total reported in the consolidated statements of cash flows (in thousands): December 31, December 31, 2022 2021 Cash and cash equivalents $ 3,855 $ 22,765 Restricted cash 100 50 Total cash, cash equivalents, and restricted cash in the consolidated statement of cash flows $ 3,955 $ 22,815 |
Accounts Receivable | The majority of the Company’s accounts receivable arise from direct product sales and sales of products under consignment arrangements, and have payment terms that generally require payment within 30 At December 31, 2022, the Company had one customer that accounted for 20.4% of the Company’s total accounts receivable. At December 31, 2022, the Company has reserved approximately $0.1 million related to the outstanding receivable balance related to this customer. |
Inventory | Inventory The Company accounts for inventory at the lower of cost or net realizable value, where net realizable value is based on market prices less costs to sell. The Company establishes inventory reserves for obsolescence based upon specific identification of expired or unusable units with a corresponding provision included in cost of revenue. The allowance for excess and slow-moving inventory was $1.0 million and $0.8 million at December 31, 2022 and 2021, respectively. |
Property and Equipment, Net | Property and Equipment, Net Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation of property and equipment is computed using the straight-line method over their estimated useful lives of five three |
Goodwill and Other Long-Lived Assets | Goodwill and Other 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. Finite-lived intangible assets primarily consist of developed technology and trademarks/tradenames and are being amortized on a straight-line basis over their estimated useful lives. See Note 8 for additional information. 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 group 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. The Company recorded an impairment to developed technology and IPR&D intangible assets for the year ended December 31, 2022, and recorded an impairment to goodwill and IPR&D for the year ended December 31, 2021, for further details see Note 8 and Note 9. |
Income Taxes | Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance for deferred income tax assets is recorded when it is more likely than not that some portion or all of the deferred income tax assets will not be realized. The Company’s policy is to classify interest and penalties related to income taxes as income tax expense in the consolidated statements of operations. |
Foreign Currency | Foreign Currency When the local currency of the Company's foreign subsidiaries is the functional currency, all assets and liabilities are translated into United States dollars at the rate of exchange in effect at the balance sheet date. Income and expense items are translated at the weighted-average exchange rate prevailing during the period. The effects of foreign currency translation adjustments for these subsidiaries are deferred and reported in stockholders’ equity as a component of Accumulated Other Comprehensive Loss. The effects of foreign currency transactions denominated in a currency other than an entity's functional currency are included in Gain on foreign currency exchange in the Consolidated Statements of Operations. The Company does not hedge foreign currency translation risk in the net assets and income it reports from these sources. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue when it satisfies a performance obligation by transferring control of the promised goods or services to its customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. Product sales consist of a single performance obligation that the Company satisfies at a point in time. The Company recognizes product revenue when the following events have occurred: (a) the Company has transferred physical possession of the products, (b) the Company has a present right to payment, (c) the customer has legal title to the products, and (d) the customer bears significant risks and rewards of ownership of the products. For the Company’s L -B Taxes collected from customers and remitted to governmental authorities are accounted for on a net basis. Accordingly, such amounts are excluded from revenues. Amounts billed to customers related to shipping and handling are included in revenues. Shipping and handling costs related to revenue producing activities are included in cost of sales. Variable Consideration The Company records revenue from customers in an amount that reflects the transaction price it expects to be entitled to after transferring control of the goods. Customers and distributors of the L -B L -B Certain L -B Warranty The Company generally provides warranties against defects in materials and workmanship, and provides replacements at no charge to the customer, as long as the customer has notified the Company within 30 days of delivery and returns such products in accordance with the Company’s instructions. As they are considered assurance-type warranties, the Company does not account for them as separate performance obligations. Warranty reserve requirements are based on a specific assessment of the products sold with warranties where a customer asserts a claim for warranty or a product defect. For the vBloc product line, the Company has a 5-year |
Advertising Cost | Advertising Cost Advertising costs are expensed as incurred and totaled $6.8 million and $3.0 million for the years ended December 31, 2022 and 2021, respectively. |
Stock-Based Compensation | Stock-Based Compensation The Company applies ASC 718 Compensation — Stock Compensation and accordingly records compensation expense for stock options over the vesting or service period using the fair value on the date of grant, as calculated by the Company using the Black-Scholes model. The Company’s stock-based compensation plans are more fully described in Note 16. |
Net Loss Per Share | Net Loss Per Share Basic net loss per share is computed by dividing net loss by the weighted-average number of common shares outstanding during the period, including the pre-funded warrants, see Note 13, that were reclassified from warrant liability to equity as a result of the reverse stock split. Diluted net loss per share is based on the weighted-average common shares outstanding during the period plus dilutive potential common shares calculated using the treasury stock method. Such potentially dilutive shares are excluded when the effect would be to reduce a net loss per share. For purposes of basic and diluted per share computations, loss from continuing operations and net loss are reduced by the down round adjustments for convertible preferred stock and warrants. 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: December 31, 2022 2021 Stock options 21,416 17,701 Unvested restricted stock units 4,530 34,227 Convertible preferred stock 10 10 Warrants 193,476 139,047 |
Concentration of Credit Risk, Interest Rate Risk and Foreign Currency Exchange Rate | Concentration of Credit Risk, Interest Rate Risk and Foreign Currency Exchange Rate Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and cash equivalents, restricted cash and trade accounts receivable. Cash and cash equivalents are primarily deposited in demand and money market accounts. At times, such deposits may be in excess of insured limits. Investments in money market funds are not considered to be bank deposits and are not insured or guaranteed by the federal deposit insurance company or other government agency. These money market funds seek to preserve the value of the investment at $1.00 per share; however, it is possible to lose money investing in these funds. The Company has not experienced any losses on its deposits of cash and cash equivalents. To minimize the risk associated with trade accounts receivable, management maintains relationships with the Company’s customers that allow management to monitor current changes in business operations so the Company can respond as needed. Substantially all of the Company’s revenue is denominated in U.S. dollars. Only a small portion of revenue and expenses are denominated in foreign currencies, principally the Australian dollar and Euro for 2022 and 2021. The Company has not entered into any hedging contracts. Future fluctuations in the value of the U.S. dollar may affect the price competitiveness of the Company’s products outside the U.S. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (referred to as an “exit price”). Fair value of an asset or liability considers assumptions that market participants would use in pricing the asset or liability, including consideration of non-performance risk. Assets and liabilities are categorized into a three-level fair value hierarchy based on valuation inputs used to determine fair value. Level 1 inputs are quoted prices in active markets for identical assets or liabilities. Level 2 inputs are observable, either directly or indirectly. Level 3 inputs are unobservable due to little or no corroborating market data. The carrying amounts of the Company’s financial instruments, including cash equivalents, accounts receivable, accounts payable and certain accrued and other liabilities approximate fair value due to their short-term maturities. Refer to Note 9 regarding the impairment of developed technology, goodwill and IPR&D, Note 10 regarding the fair value of debt instruments and Note 14 regarding fair value measurements and inputs of warrants. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements New accounting standards adopted by the Company in 2021 are discussed below or in the related notes, where appropriate. In May 2021, the FASB issued Accounting Standards Update (“ASU”) No. 2021-04, Earnings Per Share (Topic 260), Debt – Modifications and Extinguishments (Subtopic 470-50), Compensation – Stock Compensation (Topic 718), and Derivatives and Hedging Contracts in Entity’s Own Equity (Subtopic 815-40). This update provides guidance to clarify and reduce diversity in an accounting for modifications or exchanges of freestanding equity-classified written call options (for example, warrants) that is not within the scope of another Topic. An entity should treat a modification of the terms or conditions or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange as an exchange of the original instrument for a new instrument. This update additionally provides further guidance on measuring the effect of a modification or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange on the basis of the substance of the transaction, in the same manner as if cash had been paid as consideration. This guidance is effective for the fiscal years and interim periods within those years beginning after December 15, 2021. Early adoption is permitted, including adoption in an interim period. The Company adopted this guidance early and the adoption did not have a material impact on the Company’s consolidated financial statements. In December 2019, the FASB issued authoritative guidance intended to simplify the accounting for income taxes: ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. This guidance eliminates certain exceptions to the general approach to the income tax accounting model and adds new guidance to reduce the complexity in accounting for income taxes. The adoption of this guidance on January 1, 2021, did not have a material impact on the Company’s consolidated financial statements. New accounting standards not yet adopted are discussed below. In June 2016, the FASB issued ASU 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 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. Various other accounting standards and interpretations have been issued during 2022 effective dates and effective dates subsequent to December 31, 2021. The Company has evaluated the recently issued accounting pronouncements that are currently effective or will be effective in 2022 and believe that none of them have had or will have a material effect on the Company’s financial position, results of operations or cash flows. |
2021 Restatement and Other Co_2
2021 Restatement and Other Corrections of Previously Issued Consolidated Financial Statements (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
2021 Restatement and Other Corrections of Previously Issued Consolidated Financial Statements | |
Summary of the effects of the restatements on each financial statements | Consolidated Balance Sheet as of December 31, 2021 As Previously Reported Adjustments As Restated Prepaid expenses and other current assets $ 1,622 $ (317) $ 1,305 Total current assets 30,255 (317) 29,938 Other assets 1,456 (1,410) 46 Total assets 54,258 (1,727) 52,531 Accrued and other liabilities 3,169 199 3,368 Total current liabilities 7,331 199 7,530 Deferred income taxes 555 (188) 367 Total liabilities 8,186 11 8,197 Additional paid-in capital 622,924 (525) 622,399 Accumulated deficit (576,760) (1,213) (577,973) Total stockholders’ equity 46,072 (1,738) 44,334 Total liabilities and stockholders’ equity 54,258 (1,727) 52,531 Consolidated Statement of Operations for the year ended December 31, 2021 Year Ended December 31, 2021 As Previously Stated Adjustments As Restated Sales and marketing $ 9,165 $ (272) $ 8,893 General and administrative 24,410 (91) 24,319 Research and development 2,522 (153) 2,369 Loss on impairment of intangible asset and goodwill 28,752 1,897 30,649 Total operating expenses 64,849 1,381 66,230 Operating loss (56,501) (1,381) (57,882) Loss before income tax provision (62,039) (1,381) (63,420) Income tax benefit (106) (168) (274) Net loss (61,933) (1,213) (63,146) Net loss per share - basic and diluted: Net loss per share - basic and diluted $ (250.16) $ (38.81) $ (288.97) Shares used to compute basic and diluted net loss per share 247,571 (29,049) 218,522 Consolidated Statement of Other Comprehensive Income for the year ended December 31, 2021 Year Ended December 31, 2021 As Previously Stated Adjustments As Restated Net loss $ (61,933) $ (1,213) $ (63,146) Comprehensive loss (61,904) (1,213) (63,117) Consolidated Statement of Stockholders’ Equity for the year ended December 31, 2021 APIC Accumulated Deficit Total Equity As Previously As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Stated Adjustments As Restated Balance December 31, 2020 $ 529,435 $ — $ 529,435 $ (514,827) $ — $ (514,827) $ 14,488 $ — $ 14,488 Net loss — — — (61,933) (1,213) (63,146) (61,933) (1,213) (63,146) Stock-based compensation expense, net 12,752 (525) 12,227 — — — 12,752 (525) 12,227 Balance December 31, 2021 622,924 (525) 622,399 (576,760) (1,213) (577,973) 46,072 (1,738) 44,334 Consolidated Statement of Cash Flow for the year ended December 31, 2021 Year Ended December 31, 2021 As Previously Reported Adjustment As Restated Cash flows from operating activities: Net loss $ (61,933) $ (1,213) $ (63,146) Loss on impairment of intangible assets and goodwill 28,752 1,897 30,649 Stock-based compensation 12,752 (525) 12,227 Deferred income tax benefit (60) (188) (248) Prepaid expenses and other current assets (393) 317 (76) Accounts payable and accrued liabilities (1,480) 200 (1,280) Other 488 (488) — Condensed Consolidated Balance Sheet as of June 30, 2021 June 30, 2021 As Previously Reported Adjustments As Restated Prepaid expenses and other current assets $ 1,371 $ (302) $ 1,069 Total current assets 65,605 (302) 65,303 Goodwill 21,623 1,897 23,520 Other assets 1,628 (1,582) 46 Total assets 120,000 13 120,013 Accumulated deficit (523,603) 13 (523,590) Total stockholders’ equity 58,119 13 58,132 Total liabilities and stockholders’ equity 120,000 13 120,013 Condensed Consolidated Balance Sheet as of September 30, 2021 September 30, 2021 As Previously Reported Adjustments As Restated Prepaid expenses and other current assets $ 1,633 $ (316) $ 1,317 Total current assets 37,589 (316) 37,273 Goodwill 21,053 1,897 22,950 Other assets 1,535 (1,489) 46 Total assets 90,698 92 90,790 Additional paid-in capital 620,611 (486) 620,125 Accumulated deficit (541,302) 578 (540,724) Total stockholders’ equity 79,220 92 79,312 Total liabilities and stockholders’ equity 90,698 92 90,790 Condensed Consolidated Statement of Operations for the three months ended March 31, 2021 As Previously Reported Adjustment As Revised Net loss per share - basic and diluted $ (62.04) $ 0.16 $ (61.88) Shares used to compute basic and diluted net loss per share 78,560 203 78,763 Condensed Consolidated Statement of Operations for the three and six months ended June 30, 2021 Three Months Ended June 30, 2021 Six Months Ended June 30, 2021 As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated General and administrative $ 4,311 $ (13) $ 4,298 $ 7,031 $ (13) $ 7,018 Total operating expenses 5,855 (13) 5,842 10,396 (13) 10,383 Operating loss (3,702) 13 (3,689) (5,960) 13 (5,947) Loss before income tax provision (3,874) 13 (3,861) (8,723) 13 (8,710) Net loss (3,902) 13 (3,889) (8,776) 13 (8,763) Net loss per share - basic and diluted: Net loss per share - basic and diluted $ (23.72) $ (18.98) $ (42.70) $ (55.34) $ (47.85) $ (103.19) Shares used to compute basic and diluted net loss per share 164,523 (73,443) 91,080 158,575 (73,654) 84,921 Condensed Consolidated Statement of Operations for the three and nine months ended September 30, 2021 Three Months Ended September 30, 2021 Nine Months Ended September 30, 2021 As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Sales and marketing $ 3,496 $ (250) $ 3,246 $ 6,186 $ (249) $ 5,937 General and administrative 12,052 (169) 11,883 19,085 (183) 18,902 Research and development 1,571 (146) 1,425 2,245 (146) 2,099 Total operating expenses 17,119 (565) 16,554 27,516 (578) 26,938 Operating loss (14,984) 565 (14,419) (20,944) 578 (20,366) Loss before income tax provision (17,729) 565 (17,164) (26,452) 578 (25,874) Net loss (17,699) 565 (17,134) (26,475) 578 (25,897) Net loss per share - basic and diluted: Net loss per share - basic and diluted $ (73.76) $ 23.63 $ (50.13) $ (125.43) $ (24.88) $ (150.31) Shares used to compute basic and diluted net loss per share 239,948 101,820 341,768 210,934 (38,646) 172,288 Condensed Consolidated Statement of Other Comprehensive Loss for the three and six months ended June 30, 2021 Three Months Ended June 30, 2021 Six Months Ended June 30, 2021 As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Net loss $ (3,902) $ 13 $ (3,889) $ (8,776) $ 13 $ (8,763) Comprehensive loss (3,909) 13 (3,896) (8,764) 13 (8,751) Condensed Consolidated Statement of Other Comprehensive Loss for the three and nine months ended September 30, 2021 Three Months Ended September 30, 2021 Nine Months Ended September 30, 2021 As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Net loss $ (17,699) $ 565 $ (17,134) $ (26,475) $ 578 $ (25,897) Comprehensive loss (17,697) 565 (17,132) (26,461) 578 (25,883) Condensed Consolidated Statement of Stockholders’ Equity for the three months ended June 30, 2021 Additional Paid-In Capital Accumulated Deficit Total Equity As Previously As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Stated Adjustments As Restated Balance March 31, 2021 $ 532,504 $ — $ 532,504 $ (519,701) $ — $ (519,701) $ 12,708 $ — $ 12,708 Net loss — — — (3,902) 13 (3,889) (3,902) 13 (3,889) Balance June 30, 2021 581,823 — 581,823 (523,603) 13 (523,590) 58,119 13 58,132 Condensed Consolidated Statement of Stockholders’ Equity for the six months ended June 30, 2021 Additional Paid-In Capital Accumulated Deficit Total Equity As Previously As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Stated Adjustments As Restated Balance December 31, 2020 $ 529,435 $ — $ 529,435 $ (514,827) $ — $ (514,827) $ 14,488 $ — $ 14,488 Net loss — — — (8,776) 13 (8,763) (8,776) 13 (8,763) Balance June 30, 2021 581,823 — 581,823 (523,603) 13 (523,590) 58,119 13 58,132 Condensed Consolidated Statement of Stockholders’ Equity for the three months ended September 30, 2021 Additional Paid-In Capital Accumulated Deficit Total Equity As Previously As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Stated Adjustments As Restated Balance June 30, 2021 $ 581,823 $ — $ 581,823 $ (523,603) $ 13 $ (523,590) $ 58,119 $ 13 $ 58,132 Net loss — — — (17,699) 565 (17,134) (17,699) 565 (17,134) Stock-based compensation expense, net 10,720 (486) 10,234 — — — 10,720 (486) 10,234 Balance September 30, 2021 620,611 (486) 620,125 (541,302) 578 (540,724) 79,220 92 79,312 Condensed Consolidated Statement of Stockholders’ Equity for the nine months ended September 30, 2021 Additional Paid-In Capital Accumulated Deficit Total Equity As Previously As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Stated Adjustments As Restated Balance December 31, 2020 $ 529,435 $ — $ 529,435 $ (514,827) $ — $ (514,827) $ 14,488 $ — $ 14,488 Net loss — — — (26,475) 578 (25,897) (26,475) 578 (25,897) Stock-based compensation expense, net 10,457 (486) 9,971 — — — 10,457 (486) 9,971 Balance September 30, 2021 620,611 (486) 620,125 (541,302) 578 (540,724) 79,220 92 79,312 Condensed Consolidated Statement of Cash Flow for the six months ended June 30, 2021 Six Months Ended June 30, 2021 As Previously Reported Adjustment As Restated Cash flows from operating activities: Net loss $ (8,776) $ 13 $ (8,763) Prepaid expenses and other current assets (267) 303 36 Other 316 (316) — Condensed Consolidated Statement of Cash Flow for the nine months ended September 30, 2021 Nine Months Ended September 30, 2021 As Previously Reported Adjustment As Restated Cash flows from operating activities: Net loss $ (26,475) $ 578 $ (25,897) Stock-based compensation 10,457 (486) 9,971 Prepaid expenses and other current assets (399) 316 (83) Other 408 (408) — |
2022 Restatement and Other Co_2
2022 Restatement and Other Corrections of Previously Issued Condensed Consolidated Financial Statements (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
2022 Restatement and Other Corrections of Previously Issued Condensed Consolidated Financial Statements (Unaudited) | |
Summary of the effect of the revision on condensed consolidated statements | Condensed Consolidated Balance Sheet as of March 31, 2022 March 31, 2022 As Previously Reported Adjustments As Restated Prepaid expenses and other current assets $ 1,759 $ (316) $ 1,443 Total current assets 23,627 (316) 23,311 Other assets 1,377 (1,331) 46 Total assets 47,270 (1,647) 45,623 Accrued and other liabilities 3,463 19 3,482 Total current liabilities 8,151 19 8,170 Total liabilities 8,645 19 8,664 Additional paid-in capital 623,671 (553) 623,118 Accumulated deficit (584,975) (1,113) (586,088) Total stockholders’ equity 38,625 (1,666) 36,959 Total liabilities and stockholders’ equity 47,270 (1,647) 45,623 Condensed Consolidated Balance Sheet as of June 30, 2022 June 30, 2022 As Previously Reported Adjustments As Restated Prepaid expenses and other current assets $ 1,269 $ (316) $ 953 Total current assets 19,487 (316) 19,171 Other assets 1,298 (1,252) 46 Total assets 41,925 (1,568) 40,357 Accrued and other liabilities 5,814 19 5,833 Total current liabilities 9,190 19 9,209 Total liabilities 9,562 19 9,581 Additional paid-in capital 626,986 (606) 626,380 Accumulated deficit (594,551) (981) (595,532) Total stockholders’ equity 32,363 (1,587) 30,776 Total liabilities and stockholders’ equity 41,925 (1,568) 40,357 Condensed Consolidated Balance Sheet as of September 30, 2022 September 30, 2022 As Previously Reported Adjustments As Restated Prepaid expenses and other current assets $ 926 $ (316) $ 610 Total current assets 13,573 (316) 13,257 Other intangible assets, net 12,513 (482) 12,031 Other assets 1,219 (1,173) 46 Total assets 28,456 (1,971) 26,485 Accrued and other liabilities 4,848 19 4,867 Total current liabilities 7,513 19 7,532 Total liabilities 7,513 19 7,532 Additional paid-in capital 627,373 (634) 626,739 Accumulated deficit (606,362) (1,356) (607,718) Total stockholders’ equity 20,943 (1,990) 18,953 Total liabilities and stockholders’ equity 28,456 (1,971) 26,485 Condensed Consolidated Statement of Operations for the three months ended March 31, 2022 Three Months Ended March 31, 2022 As Previously Stated Adjustments As Restated Sales and marketing $ 4,707 $ (13) $ 4,694 General and administrative 4,163 (271) 3,892 Research and development 748 (3) 745 Total operating expenses 9,618 (287) 9,331 Operating loss (8,400) 287 (8,113) Loss before income tax provision (8,372) 287 (8,085) Income tax benefit (157) 187 30 Net loss (8,215) 100 (8,115) Net loss per share - basic and diluted: Net loss per share - basic and diluted $ (22.16) $ 0.29 $ (21.87) Shares used to compute basic and diluted net loss per share 370,792 239 371,031 Condensed Consolidated Statement of Operations for the three and six months ended June 30, 2022 Three Months Ended June 30, 2022 Six Months Ended June 30, 2022 As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Sales and marketing $ 4,663 $ (27) $ 4,636 $ 9,371 $ (41) $ 9,330 General and administrative 5,454 $ (91) 5,363 9,616 (362) 9,254 Research and development 761 (14) 747 1,508 (16) 1,492 Total operating expenses 11,259 (132) 11,127 20,876 (419) 20,457 Operating loss (9,376) 132 (9,244) (17,775) 419 (17,356) Loss before income tax provision (9,567) 132 (9,435) (17,939) 419 (17,520) Income tax benefit 9 — 9 (148) 187 39 Net loss (9,576) 132 (9,444) (17,791) 232 (17,559) Net loss per share - basic and diluted: Net loss per share - basic and diluted $ (24.79) $ 0.34 $ (24.45) $ (46.98) $ 0.61 $ (46.37) Condensed Consolidated Statement of Operations for the three and nine months ended September 30, 2022 Three Months Ended September 30, 2022 Nine Months Ended September 30, 2022 As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Sales and marketing $ 2,619 $ (14) $ 2,605 $ 11,990 $ (54) $ 11,936 General and administrative 3,872 (88) 3,784 13,488 (451) 13,037 Research and development 588 (5) 583 2,096 (21) 2,075 Loss on impairment of intangible assets 6,947 482 7,429 6,947 482 7,429 Total operating expenses 14,027 375 14,402 34,904 (44) 34,860 Operating loss (11,926) (375) (12,301) (29,702) 44 (29,658) Loss before income tax provision (12,174) (375) (12,549) (30,113) 44 (30,069) Income tax benefit (363) — (363) (511) 187 (324) Net loss (11,811) (375) (12,186) (29,602) (143) (29,745) Net loss per share - basic and diluted: Net loss per share - basic and diluted $ (26.18) $ (0.83) $ (27.01) $ (73.43) $ (0.36) $ (73.79) Condensed Consolidated Statement of Other Comprehensive loss for the three months ended March 31, 2022 Three Months Ended March 31, 2022 As Previously Stated Adjustments As Restated Net loss $ (8,215) $ 100 $ (8,115) Comprehensive loss (8,194) 100 (8,094) Condensed Consolidated Statement of Other Comprehensive Loss for the three and six months ended June 30, 2022 Three Months Ended June 30, 2022 Six Months Ended June 30, 2022 As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Net loss $ (9,576) $ 132 $ (9,444) $ (17,791) $ 232 $ (17,559) Comprehensive loss (9,577) 132 (9,445) (17,771) 232 (17,539) Condensed Consolidated Statement of Other Comprehensive Loss for the three and nine months ending September 30, 2022 Three Months Ended September 30, 2022 Nine Months Ended September 30, 2022 As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Net loss $ (11,811) $ (375) $ (12,186) $ (29,602) $ (143) $ (29,745) Comprehensive loss (11,807) (375) (12,182) (29,578) (143) (29,721) Condensed Consolidated Statement of Stockholders’ Equity for the three months ended March 31, 2022 Additional Paid-In Capital Accumulated Deficit Total Equity As Previously As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Stated Adjustments As Restated Balance December 31, 2021 $ 622,924 $ (525) $ 622,399 $ (576,760) $ (1,213) $ (577,973) $ 46,072 $ (1,738) $ 44,334 Net loss — — — (8,215) 100 (8,115) (8,215) 100 (8,115) Stock-based compensation expense, net 747 (28) 719 — — — 747 (28) 719 Balance March 31, 2022 623,671 (553) 623,118 (584,975) (1,113) (586,088) 38,625 (1,666) 36,959 Condensed Consolidated Statement of Stockholders’ Equity for the three months ended June 30, 2022 Additional Paid-In Capital Accumulated Deficit Total Equity As Previously As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Stated Adjustments As Restated Balance March 31, 2022 $ 623,671 $ (553) $ 623,118 $ (584,975) $ (1,113) $ (586,088) $ 38,625 $ (1,666) $ 36,959 Net loss — (9,576) 132 (9,444) (9,576) 132 (9,444) Stock-based compensation expense, net 823 (53) 770 — — — 823 (53) 770 Balance June 30, 2022 626,986 (606) 626,380 (594,551) (981) (595,532) 32,363 (1,587) 30,776 Condensed Consolidated Statement of Stockholders’ Equity for the six months ended June 30, 2022 Additional Paid-In Capital Accumulated Deficit Total Equity As Previously As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Stated Adjustments As Restated Balance December 31, 2021 $ 622,924 $ (525) $ 622,399 $ (576,760) $ (1,213) $ (577,973) $ 46,072 $ (1,738) $ 44,334 Net loss — — — (17,791) 232 (17,559) (17,791) 232 (17,559) Stock-based compensation expense, net 1,570 (81) 1,489 — — — 1,570 (81) 1,489 Balance June 30, 2022 626,986 (606) 626,380 (594,551) (981) (595,532) 32,363 (1,587) 30,776 Condensed Consolidated Statement of Stockholders’ Equity for the three months ended September 30, 2022 Additional Paid-In Capital Accumulated Deficit Total Equity As Previously As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Stated Adjustments As Restated Balance June 30, 2022 $ 626,986 $ (606) $ 626,380 $ (594,551) $ (981) $ (595,532) $ 32,363 $ (1,587) $ 30,776 Net loss — — — (11,811) (375) (12,186) (11,811) (375) (12,186) Stock-based compensation expense, net 387 (28) 359 — — — 387 (28) 359 Balance September 30, 2022 627,373 (634) 626,739 (606,362) (1,356) (607,718) 20,943 (1,990) 18,953 Condensed Consolidated Statement of Stockholders’ Equity for the nine months ended September 30, 2022 Additional Paid-In Capital Accumulated Deficit Total Equity As Previously As Previously As Previously Stated Adjustments As Restated Stated Adjustments As Restated Stated Adjustments As Restated Balance December 31, 2021 $ 622,924 $ (525) $ 622,399 $ (576,760) $ (1,213) $ (577,973) $ 46,072 $ (1,738) $ 44,334 Net loss — — — (29,602) (143) (29,745) (29,602) (143) (29,745) Stock-based compensation expense, net 1,957 (109) 1,848 — — — 1,957 (109) 1,848 Balance September 30, 2022 627,373 (634) 626,739 (606,362) (1,356) (607,718) 20,943 (1,990) 18,953 Condensed Consolidated Statement of Cash Flow for the three months ended March 30, 2022 Three Months Ended March 31, 2022 As Previously Reported Adjustment As Restated Cash flows from operating activities: Net loss $ (8,215) $ 100 $ (8,115) Stock-based compensation 747 (28) 719 Deferred income tax benefit (187) 187 — Accounts payable and accrued liabilities 420 (180) 240 Other 79 (79) — Condensed Consolidated Statement of Cash Flow for the six months ended June 30, 2022 Six Months Ended June 30, 2022 As Previously Reported Adjustment As Restated Cash flows from operating activities: Net loss $ (17,791) $ 232 $ (17,559) Stock-based compensation 1,570 (81) 1,489 Deferred income tax benefit (188) 188 — Accounts payable and accrued liabilities 1,681 (181) 1,500 Other 158 (158) — Condensed Consolidated Statement of Cash Flow for the nine months Ended September 30, 2022 Nine Months Ended September 30, 2022 As Previously Reported Adjustment As Restated Cash flows from operating activities: Net loss $ (29,602) $ (143) $ (29,745) Loss on impairment of intangible assets and goodwill 6,947 482 7,429 Stock-based compensation 1,957 (109) 1,848 Deferred income tax benefit (555) 187 (368) Accounts payable and accrued liabilities 129 (180) (51) Other 237 (237) — |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Summary of Significant Accounting Policies | |
Reconciliation of cash, cash equivalents and restricted cash | The following table provides a reconciliation of cash, cash equivalents and restricted cash reported in the consolidated balance sheets to the same total reported in the consolidated statements of cash flows (in thousands): December 31, December 31, 2022 2021 Cash and cash equivalents $ 3,855 $ 22,765 Restricted cash 100 50 Total cash, cash equivalents, and restricted cash in the consolidated statement of cash flows $ 3,955 $ 22,815 |
Schedule of anti-dilutive securities | December 31, 2022 2021 Stock options 21,416 17,701 Unvested restricted stock units 4,530 34,227 Convertible preferred stock 10 10 Warrants 193,476 139,047 |
Supplemental Balance Sheet In_2
Supplemental Balance Sheet Information (as Restated) (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Supplemental Balance Sheet Information (as Restated) | |
Schedule of components of inventory | December 31, December 31, 2022 2021 Raw materials $ 832 $ 829 Sub-assemblies 864 682 Finished goods 1,915 1,492 Total inventory $ 3,611 $ 3,003 |
Schedule of components of prepaid expenses and other current assets | December 31, December 31, 2022 2021 As Restated Prepaid insurance $ 78 $ 419 Prepaid advertising and marketing 3 698 Other current assets 84 188 Total prepaid expenses and other current assets $ 165 $ 1,305 |
Schedule of components of accrued and other liabilities | December 31, December 31, 2022 2021 As Restated Payroll and benefits $ 1,829 $ 1,527 Accrued legal settlements 1,775 180 Customer deposits 510 549 Taxes 119 326 Accrued insurance premium — 301 Accrued professional 316 300 Other liabilities 491 185 Total accrued and other liabilities $ 5,040 $ 3,368 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Property and Equipment | |
Schedule of property and equipment | December 31, 2022 2021 Machinery and equipment $ 582 $ 955 Furniture and equipment 27 38 Computer hardware and software 136 135 Tooling and molds 199 236 Leasehold improvements 19 23 Construction in progress 66 407 1,029 1,794 Less accumulated depreciation and amortization (331) (340) Property and equipment, net $ 698 $ 1,454 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets (as Restated) (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets (as Restated) | |
Summary of identifiable intangible assets | December 31, 2022 Weighted Average Useful Life (years) Gross Carrying Amount Accumulated Amortization Net Book Value Finite-lived intangible assets: Developed technology 10.0 $ 5,989 $ (5,805) $ 184 Trademarks/Tradenames 10.0 462 (386) 76 Total $ 6,451 $ (6,191) $ 260 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 |
Schedule of gross amount and accumulated impairment loss of indefinite-lived intangible assets | December 31, 2022 2021 Gross amount $ 20,721 $ 20,721 Accumulated impairment loss (20,721) (13,774) Indefinite-lived intangible assets, net $ — $ 6,947 |
Schedule of future amortization of Finite-Lived intangible assets | Year ending December 31, 2023 $ 44 2024 44 2025 44 2026 44 2027 44 Thereafter 40 $ 260 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases | |
Schedule of supplemental information related to operating leases | December 31, December 31, Balance Sheet information 2022 2021 Operating lease ROU assets $ 171 $ 266 Operating lease liabilities, current portion $ 171 $ 279 Total operating lease liabilities $ 171 $ 279 Cash flow information for the year ended December 31, 2022 2021 Cash paid for amounts included in the measurement of operating leases liabilities $ 560 $ 565 |
Schedule of maturities of operating lease liabilities | 2023 174 Total lease payments 174 Less: imputed interest 3 Total lease liabilities $ 171 Weighted-average remaining lease term at end of period (in years) 0.5 Weighted-average discount rate at end of period 5.1 % |
Acquisition (as Restated) (Tabl
Acquisition (as Restated) (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Acquisition (as Restated) | |
Schedule of fair values of the assets acquired and liabilities assumed | (As Restated) Current assets $ 5,887 Property and equipment, net 796 Right-of-use assets 335 Goodwill 23,463 Developed technology 2,730 Liabilities assumed (2,650) Total purchase price 30,561 Less: cash acquired (5,207) Total purchase price, net of cash acquired $ 25,354 |
Schedule of pro forma results of operations of acquisition | Revenue Net Loss (As Restated) (Unaudited) (Unaudited) Combined entity: Supplemental pro forma from January 1, 2021 to December 31, 2021 $ 13,432 $ (71,178) |
Warrants (Tables)
Warrants (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Schedule of warrant activity | Shares Balance December 31, 2020 161,050 Obtained due to merger 17,505 (1) Issued 138,215 (2) Exercised (177,723) (3) Cancelled — Balance December 31, 2021 139,047 Issued 145,192 (4) Exercised (84,614) (5) Cancelled (6,149) Balance December 31, 2022 193,476 (1) Obalon’s warrants outstanding at the time of the merger with the 1 -for-3 reverse stock split adjustment. In addition, this amount includes, 10,098 warrants converted into common shares in July of 2021, see Note 13 for further details. (2) Warrants issued in 2021 includes 11,274 of Series G warrants and 126,941 of warrants issued to various institutional investors. (3) Warrants exercised in 2021 includes 37,581 Series A warrants at an exercise price of $234.00 per share, 1,285 Series C pre-funded warrants at an exercise price of $10.50 per share, 37,581 Series E warrants at an exercise price of $300.00 per share, 7,754 Series F pre-funded warrants at an exercise price of $10.50 per share, and 83,428 Series G warrants with exercise prices ranging from $288.50 per share to $300.00 per share, and an exchange of 10,098 warrants for common stock. (4) Warrants issued in 2022 includes 74,773 reload warrants, 57,693 common stock purchase warrants, 2,885 representative’s warrants, and 9,841 pre-funded warrants. (5) Warrants exercised in 2022 includes 74,773 reload warrants at an exercise price of $33.33 per share, and 9,841 pre-funded warrants at an exercise price of $0.05 per share. |
Black Scholes Model | |
Schedule of warrant assumptions used to calculate fair value | Warrants Strike Price Volatility Remaining Life Risk Free Rate Reload warrants - June 2022 74,773 $ 33.33 64.8 % 7.5 3.32 % Reload warrants - November 2022 57,693 $ 15.00 84.3 % 5.5 4.21 % Representative's warrants 2,885 $ 15.00 84.3 % 5.0 4.23 % Pre-funded warrants 9,841 $ 0.05 84.3 % 5.5 4.21 % Warrants Strike Price Volatility Remaining Life Risk Free Rate January 19, 2021 11,274 $ 310.50 97.1 % 5.0 0.45 % June 28, 2021 118,941 $ 300.00 97.6 % 5.0 0.9 % July 16, 2021 8,000 $ 202.00 157.7 % 5.0 0.79 % |
Revenue Disaggregation and Op_2
Revenue Disaggregation and Operating Segments (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Revenue Disaggregation and Operating Segments | |
Schedule of revenue disaggregated by geography | Year Ended December 31, 2022 2021 United States $ 9,230 $ 10,297 Australia 688 1,039 Europe 1,252 2,127 Rest of world 70 137 Total revenue $ 11,240 $ 13,600 |
Stock-based Compensation(as Res
Stock-based Compensation(as Restated) (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Stock-based Compensation | |
Schedule of stock-based compensation expense | Year Ended December 31, 2022 2021 As Restated Sales and marketing $ 280 $ 949 General and administrative 1,494 10,126 Research and development 313 1,152 Total stock-based compensation expense $ 2,087 $ 12,227 |
Summary of assumptions used to estimate grant date fair value of stock options granted | Year Ended December 31, 2022 2021 As Restated Risk-free interest rate 2.67% 1.19% Expected term (in years) 6.25 6.25 Expected dividend yield 0% 0% Expected volatility 80.40% 82.68% |
Summary of unvested RSUs award activity | Weighted Average Grant Date Shares Fair Value Unvested RSUs at December 31, 2020 — $ — Granted 72,212 218.00 Vested (37,986) 218.00 Cancelled/Forfeited — — Unvested RSUs at December 31, 2021 34,226 218.00 Granted 32,777 16.92 Vested (1) (50,131) 97.44 Cancelled/Forfeited (12,342) 189.88 Non-vested RSUs at September 30, 2022 4,530 174.01 (1) At December 31, 2022, there were 278 shares of common stock related to RSU awards that have vested and the shares were not released to the participants until January of 2023. |
2003 Stock Incentive Plan, as amended and restated | |
Stock-based Compensation | |
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, 2020 1 $ 106,534,131.00 $ — Vested options obtained due to merger 7,329 1,794.00 Options granted 15,814 181.00 Options exercised (3,654) 114.00 Options cancelled (1,788) 51,261.50 Outstanding at December 31, 2021 17,702 398.57 $ — Options granted 11,201 59.00 Options exercised — — Options cancelled (7,487) 139.16 Outstanding at December 31, 2022 21,416 311.65 7.2 $ — Exercisable at December 31, 2022 14,659 412.85 6.7 — Vested and expected to vest at December 31, 2022 21,416 311.65 7.2 — |
Income Taxes (as Restated) (Tab
Income Taxes (as Restated) (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Taxes (as Restated) | |
Schedule of income tax expense (benefit) | Year ended December 31, 2022 2021 Deferred: As Restated Federal $ (293) $ (218) State (76) (30) Foreign (54) — Deferred income tax benefit (423) (248) Current: Federal 30 — State 9 11 Foreign 4 (37) Total income tax benefit, net $ (380) $ (274) |
Schedule of effective tax rate reconciliation | Year ended December 31, 2022 2021 As Restated Income tax benefit at U.S. federal statutory rate 21.0 % 21.0 % State income tax benefit, net of federal benefit 3.8 % 3.3 % Stock warrant valuation — % (2.0) % Goodwill impairment — % (7.8) % Stock-based compensation — % (12.0) % Other permanent differences (1.9) % (3.8) % Change in state tax rate 0.3 % (1.0) % Foreign rate differential (0.2) % — % Net operating loss true up — % 0.3 % Other adjustments 2.8 % 0.3 % Change in valuation allowance (25.0) % 2.1 % Effective income tax rate 0.8 % 0.4 % |
Schedule of reconciliation of amounts of uncertain tax positions | 2022 2021 As Restated Uncertain gross tax positions, January 1 $ 1,052 $ — Current year tax positions — — Increase in prior year tax positions — 1,052 Settlements — — Lapse of statute of limitations — — Uncertain gross tax positions, December 31 $ 1,052 $ 1,052 |
Schedule of components of deferred tax assets and liabilities | December 31, 2022 2021 Deferred tax assets: As Restated Start-up costs $ 1,137 $ 1,225 Capitalized research and development costs 272 408 Reserves and accruals 1,157 1,679 Property and equipment — — Intangible assets 4,597 — Research and development credit 2,492 2,492 Lease liability 43 74 Net operating loss carryforwards 63,424 55,725 State and local taxes 2 2 Total gross deferred tax assets 73,124 61,605 Valuation allowance (72,945) (61,231) Deferred tax assets, net of valuation allowance 179 374 Property and equipment (80) (23) Intangible assets — (648) Operating lease right-of-use assets (43) (70) Total gross deferred tax liabilities (123) (741) Deferred income taxes, net $ 56 $ (367) |
2021 Restatement and Other Co_3
2021 Restatement and Other Corrections of Previously Issued Consolidated Financial Statements - Effect of Revision (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Jun. 15, 2021 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Goodwill | $ 22,950 | $ 23,520 | $ 23,520 | $ 22,950 | ||||||||
General and administrative | $ 3,784 | $ 5,363 | $ 3,892 | 11,883 | 4,298 | $ 9,254 | 7,018 | $ 13,037 | 18,902 | $ 17,250 | $ 24,319 | |
Stock-based compensation expense, net | 359 | 770 | 719 | 10,234 | 1,489 | 1,848 | 9,971 | 2,087 | 12,227 | |||
Income tax benefit | (363) | 9 | 30 | 39 | (324) | $ (380) | (274) | |||||
Obalon Therapeutics Inc. | ||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Goodwill | $ 23,463 | |||||||||||
Adjustment | ||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Goodwill | 1,897 | 1,897 | 1,897 | 1,897 | ||||||||
General and administrative | (88) | (91) | (271) | (169) | $ (13) | (362) | $ (13) | (451) | (183) | (91) | ||
Stock-based compensation expense, net | $ (28) | $ (53) | (28) | $ (486) | (81) | (109) | $ (486) | (525) | ||||
Income tax benefit | $ 187 | $ 187 | $ 187 | (168) | ||||||||
Legal accruals for potential loss contingencies | (200) | |||||||||||
Adjustment | Change in capitalization and amortization term from merger | Obalon Therapeutics Inc. | ||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Intangible assets acquired | 1,900 | |||||||||||
Goodwill | 1,900 | |||||||||||
General and administrative | 200 | |||||||||||
Adjustment | Error in fair value of stock options | ||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Stock-based compensation expense, net | $ (500) |
2021 Restatement and Other Co_4
2021 Restatement and Other Corrections of Previously Issued Consolidated Financial Statements - Effect of Revision on Consolidated Balance Sheet (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||
Prepaid expenses and other current assets | $ 165 | $ 610 | $ 953 | $ 1,443 | $ 1,305 | $ 1,317 | $ 1,069 | ||
Total current assets | 9,911 | 13,257 | 19,171 | 23,311 | 29,938 | 37,273 | 65,303 | ||
Goodwill | 22,950 | 23,520 | |||||||
Other assets | 46 | 46 | 46 | 46 | 46 | 46 | 46 | ||
Total assets | 11,142 | 26,485 | 40,357 | 45,623 | 52,531 | 90,790 | 120,013 | ||
Accrued and other liabilities | 5,040 | 4,867 | 5,833 | 3,482 | 3,368 | ||||
Total current liabilities | 7,481 | 7,532 | 9,209 | 8,170 | 7,530 | ||||
Deferred tax liability, net | 367 | ||||||||
Total liabilities | 7,481 | 7,532 | 9,581 | 8,664 | 8,197 | ||||
Additional paid-in capital | 627,935 | 626,739 | 626,380 | 623,118 | 622,399 | 620,125 | |||
Accumulated deficit | (624,187) | (607,718) | (595,532) | (586,088) | (577,973) | (540,724) | (523,590) | ||
Total stockholders' equity | 3,661 | 18,953 | 30,776 | 36,959 | 44,334 | 79,312 | 58,132 | $ 12,708 | $ 14,488 |
Total liabilities and stockholders' equity | $ 11,142 | 26,485 | 40,357 | 45,623 | 52,531 | 90,790 | 120,013 | ||
As Previously Reported | |||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||
Prepaid expenses and other current assets | 926 | 1,269 | 1,759 | 1,622 | 1,633 | 1,371 | |||
Total current assets | 13,573 | 19,487 | 23,627 | 30,255 | 37,589 | 65,605 | |||
Goodwill | 21,053 | 21,623 | |||||||
Other assets | 1,219 | 1,298 | 1,377 | 1,456 | 1,535 | 1,628 | |||
Total assets | 28,456 | 41,925 | 47,270 | 54,258 | 90,698 | 120,000 | |||
Accrued and other liabilities | 4,848 | 5,814 | 3,463 | 3,169 | |||||
Total current liabilities | 7,513 | 9,190 | 8,151 | 7,331 | |||||
Deferred tax liability, net | 555 | ||||||||
Total liabilities | 7,513 | 9,562 | 8,645 | 8,186 | |||||
Additional paid-in capital | 627,373 | 626,986 | 623,671 | 622,924 | 620,611 | ||||
Accumulated deficit | (606,362) | (594,551) | (584,975) | (576,760) | (541,302) | (523,603) | |||
Total stockholders' equity | 20,943 | 32,363 | 38,625 | 46,072 | 79,220 | 58,119 | $ 12,708 | $ 14,488 | |
Total liabilities and stockholders' equity | 28,456 | 41,925 | 47,270 | 54,258 | 90,698 | 120,000 | |||
Adjustment | |||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||
Prepaid expenses and other current assets | (316) | (316) | (316) | (317) | (316) | (302) | |||
Total current assets | (316) | (316) | (316) | (317) | (316) | (302) | |||
Goodwill | 1,897 | 1,897 | |||||||
Other assets | (1,173) | (1,252) | (1,331) | (1,410) | (1,489) | (1,582) | |||
Total assets | (1,971) | (1,568) | (1,647) | (1,727) | 92 | 13 | |||
Accrued and other liabilities | 19 | 19 | 19 | 199 | |||||
Total current liabilities | 19 | 19 | 19 | 199 | |||||
Deferred tax liability, net | (188) | ||||||||
Total liabilities | 19 | 19 | 19 | 11 | |||||
Additional paid-in capital | (634) | (606) | (553) | (525) | (486) | ||||
Accumulated deficit | (1,356) | (981) | (1,113) | (1,213) | 578 | 13 | |||
Total stockholders' equity | (1,990) | (1,587) | (1,666) | (1,738) | 92 | 13 | |||
Total liabilities and stockholders' equity | $ (1,971) | $ (1,568) | $ (1,647) | $ (1,727) | $ 92 | $ 13 |
2021 Restatement and Other Co_5
2021 Restatement and Other Corrections of Previously Issued Consolidated Financial Statements - Effect of Revision on Consolidated Statement of Operations (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Sales and marketing | $ 2,605 | $ 4,636 | $ 4,694 | $ 3,246 | $ 9,330 | $ 11,936 | $ 5,937 | $ 14,093 | $ 8,893 | |||
General and administrative | 3,784 | 5,363 | 3,892 | 11,883 | $ 4,298 | 9,254 | $ 7,018 | 13,037 | 18,902 | 17,250 | 24,319 | |
Research and development | 583 | 747 | 745 | 1,425 | 1,492 | 2,075 | 2,099 | 2,537 | 2,369 | |||
Loss on impairment of intangible asset and goodwill | 7,429 | 7,429 | 18,744 | 30,649 | ||||||||
Total operating expenses | 14,402 | 11,127 | 9,331 | 16,554 | 5,842 | 20,457 | 10,383 | 34,860 | 26,938 | 53,153 | 66,230 | |
Operating loss | (12,301) | (9,244) | (8,113) | (14,419) | (3,689) | (17,356) | (5,947) | (29,658) | (20,366) | (46,351) | (57,882) | |
Loss before income tax provision | (12,549) | (9,435) | (8,085) | (17,164) | (3,861) | (17,520) | (8,710) | (30,069) | (25,874) | (46,594) | (63,420) | |
Income tax benefit | (363) | 9 | 30 | 39 | (324) | (380) | (274) | |||||
Net loss | $ (12,186) | $ (9,444) | $ (8,115) | $ (17,134) | $ (3,889) | $ (17,559) | $ (8,763) | $ (29,745) | $ (25,897) | $ (46,214) | $ (63,146) | |
Net loss per share - basic and diluted: | ||||||||||||
Net loss per share - basic (in dollars per share) | $ (27.01) | $ (24.45) | $ (21.87) | $ (50.13) | $ (42.70) | $ (61.88) | $ (46.37) | $ (103.19) | $ (73.79) | $ (150.31) | $ (108.90) | $ (288.97) |
Net loss per share - diluted (in dollars per share) | $ (27.01) | $ (24.59) | $ (21.87) | $ (50.13) | $ (42.70) | $ (61.88) | $ (46.37) | $ (103.19) | $ (73.79) | $ (150.31) | $ (108.90) | $ (288.97) |
Shares used to compute basic net loss per share | 371,031 | 341,768 | 91,080 | 78,763 | 84,921 | 172,288 | 424,390 | 218,522 | ||||
Shares used to compute diluted net loss per share | 371,031 | 341,768 | 91,080 | 78,763 | 84,921 | 172,288 | 424,390 | 218,522 | ||||
As Previously Reported | ||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Sales and marketing | $ 2,619 | $ 4,663 | $ 4,707 | $ 3,496 | $ 9,371 | $ 11,990 | $ 6,186 | $ 9,165 | ||||
General and administrative | 3,872 | 5,454 | 4,163 | 12,052 | $ 4,311 | 9,616 | $ 7,031 | 13,488 | 19,085 | 24,410 | ||
Research and development | 588 | 761 | 748 | 1,571 | 1,508 | 2,096 | 2,245 | 2,522 | ||||
Loss on impairment of intangible asset and goodwill | 6,947 | 6,947 | 28,752 | |||||||||
Total operating expenses | 14,027 | 11,259 | 9,618 | 17,119 | 5,855 | 20,876 | 10,396 | 34,904 | 27,516 | 64,849 | ||
Operating loss | (11,926) | (9,376) | (8,400) | (14,984) | (3,702) | (17,775) | (5,960) | (29,702) | (20,944) | (56,501) | ||
Loss before income tax provision | (12,174) | (9,567) | (8,372) | (17,729) | (3,874) | (17,939) | (8,723) | (30,113) | (26,452) | (62,039) | ||
Income tax benefit | (363) | 9 | (157) | (148) | (511) | (106) | ||||||
Net loss | $ (11,811) | $ (9,576) | $ (8,215) | $ (17,699) | $ (3,902) | $ (17,791) | $ (8,776) | $ (29,602) | $ (26,475) | $ (61,933) | ||
Net loss per share - basic and diluted: | ||||||||||||
Net loss per share - basic (in dollars per share) | $ (26.18) | $ (24.79) | $ (22.16) | $ (73.76) | $ (23.72) | $ (62.04) | $ (46.98) | $ (55.34) | $ (73.43) | $ (125.43) | $ (250.16) | |
Net loss per share - diluted (in dollars per share) | $ (26.18) | $ (24.79) | $ (22.16) | $ (73.76) | $ (23.72) | $ (62.04) | $ (46.98) | $ (55.34) | $ (73.43) | $ (125.51) | $ (250.16) | |
Shares used to compute basic net loss per share | 370,792 | 239,948 | 164,523 | 78,560 | 158,575 | 210,934 | 247,571 | |||||
Shares used to compute diluted net loss per share | 370,792 | 239,948 | 164,523 | 78,560 | 158,575 | 210,934 | 247,571 | |||||
Adjustment | ||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Sales and marketing | $ (14) | $ (27) | $ (13) | $ (250) | $ (41) | $ (54) | $ (249) | $ (272) | ||||
General and administrative | (88) | (91) | (271) | (169) | $ (13) | (362) | $ (13) | (451) | (183) | (91) | ||
Research and development | (5) | (14) | (3) | (146) | (16) | (21) | (146) | (153) | ||||
Loss on impairment of intangible asset and goodwill | 482 | 482 | 1,897 | |||||||||
Total operating expenses | 375 | (132) | (287) | (565) | (13) | (419) | (13) | (44) | (578) | 1,381 | ||
Operating loss | (375) | 132 | 287 | 565 | 13 | 419 | 13 | 44 | 578 | (1,381) | ||
Loss before income tax provision | (375) | 132 | 287 | 565 | 13 | 419 | 13 | 44 | 578 | (1,381) | ||
Income tax benefit | 187 | 187 | 187 | (168) | ||||||||
Net loss | $ (375) | $ 132 | $ 100 | $ 565 | $ 13 | $ 232 | $ 13 | $ (143) | $ 578 | $ (1,213) | ||
Net loss per share - basic and diluted: | ||||||||||||
Net loss per share - basic (in dollars per share) | $ (0.83) | $ 0.34 | $ 0.29 | $ 23.63 | $ (18.98) | $ 0.16 | $ 0.61 | $ (47.85) | $ (0.36) | $ (24.88) | $ (38.81) | |
Net loss per share - diluted (in dollars per share) | $ (0.83) | $ 0.20 | $ (0.29) | $ 23.63 | $ (18.98) | $ 0.16 | $ 0.61 | $ (47.85) | $ (0.36) | $ (24.80) | $ (38.81) | |
Shares used to compute basic net loss per share | 239 | 101,820 | (73,443) | 203 | (73,654) | (38,646) | (29,049) | |||||
Shares used to compute diluted net loss per share | 239 | 101,820 | (73,443) | 203 | (73,654) | (38,646) | (29,049) |
2021 Restatement and Other Co_6
2021 Restatement and Other Corrections of Previously Issued Consolidated Financial Statements - Effect of Revision on Consolidated Statement of Other Comprehensive Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | |||||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Net loss | $ (12,186) | $ (9,444) | $ (8,115) | $ (17,134) | $ (3,889) | $ (17,559) | $ (8,763) | $ (29,745) | $ (25,897) | $ (46,214) | $ (63,146) |
Comprehensive loss | (12,182) | (9,445) | (8,094) | (17,132) | (3,896) | (17,539) | (8,751) | (29,721) | (25,883) | $ (46,210) | (63,117) |
As Previously Reported | |||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Net loss | (11,811) | (9,576) | (8,215) | (17,699) | (3,902) | (17,791) | (8,776) | (29,602) | (26,475) | (61,933) | |
Comprehensive loss | (11,807) | (9,577) | (8,194) | (17,697) | (3,909) | (17,771) | (8,764) | (29,578) | (26,461) | (61,904) | |
Adjustment | |||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Net loss | (375) | 132 | 100 | 565 | 13 | 232 | 13 | (143) | 578 | (1,213) | |
Comprehensive loss | $ (375) | $ 132 | $ 100 | $ 565 | $ 13 | $ 232 | $ 13 | $ (143) | $ 578 | $ (1,213) |
2021 Restatement and Other Co_7
2021 Restatement and Other Corrections of Previously Issued Consolidated Financial Statements - Effect of Revision on Consolidated Statement of Stockholders Equity (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | |||||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Changes in Stockholders' (Deficit) Equity | |||||||||||
Balance | $ 30,776 | $ 36,959 | $ 44,334 | $ 58,132 | $ 12,708 | $ 44,334 | $ 14,488 | $ 44,334 | $ 14,488 | $ 44,334 | $ 14,488 |
Net loss | (12,186) | (9,444) | (8,115) | (17,134) | (3,889) | (17,559) | (8,763) | (29,745) | (25,897) | (46,214) | (63,146) |
Stock-based compensation expense, net | 359 | 770 | 719 | 10,234 | 1,489 | 1,848 | 9,971 | 2,087 | 12,227 | ||
Balance | 18,953 | 30,776 | 36,959 | 79,312 | 58,132 | 30,776 | 58,132 | 18,953 | 79,312 | 3,661 | 44,334 |
As Previously Reported | |||||||||||
Changes in Stockholders' (Deficit) Equity | |||||||||||
Balance | 32,363 | 38,625 | 46,072 | 58,119 | 12,708 | 46,072 | 14,488 | 46,072 | 14,488 | 46,072 | 14,488 |
Net loss | (11,811) | (9,576) | (8,215) | (17,699) | (3,902) | (17,791) | (8,776) | (29,602) | (26,475) | (61,933) | |
Stock-based compensation expense, net | 387 | 823 | 747 | 10,720 | 1,570 | 1,957 | 10,457 | 12,752 | |||
Balance | 20,943 | 32,363 | 38,625 | 79,220 | 58,119 | 32,363 | 58,119 | 20,943 | 79,220 | 46,072 | |
Adjustment | |||||||||||
Changes in Stockholders' (Deficit) Equity | |||||||||||
Balance | (1,587) | (1,666) | (1,738) | 13 | (1,738) | (1,738) | (1,738) | ||||
Net loss | (375) | 132 | 100 | 565 | 13 | 232 | 13 | (143) | 578 | (1,213) | |
Stock-based compensation expense, net | (28) | (53) | (28) | (486) | (81) | (109) | (486) | (525) | |||
Balance | (1,990) | (1,587) | (1,666) | 92 | 13 | (1,587) | 13 | (1,990) | 92 | (1,738) | |
Additional Paid-in Capital | |||||||||||
Changes in Stockholders' (Deficit) Equity | |||||||||||
Balance | 626,380 | 623,118 | 622,399 | 581,823 | 532,504 | 622,399 | 529,435 | 622,399 | 529,435 | 622,399 | 529,435 |
Stock-based compensation expense, net | 359 | 770 | 719 | 10,234 | 1,489 | 1,848 | 9,971 | 2,087 | 12,227 | ||
Balance | 626,739 | 626,380 | 623,118 | 620,125 | 581,823 | 626,380 | 581,823 | 626,739 | 620,125 | 627,935 | 622,399 |
Additional Paid-in Capital | As Previously Reported | |||||||||||
Changes in Stockholders' (Deficit) Equity | |||||||||||
Balance | 626,986 | 623,671 | 622,924 | 581,823 | 532,504 | 622,924 | 529,435 | 622,924 | 529,435 | 622,924 | 529,435 |
Stock-based compensation expense, net | 387 | 823 | 747 | 10,720 | 1,570 | 1,957 | 10,457 | 12,752 | |||
Balance | 627,373 | 626,986 | 623,671 | 620,611 | 581,823 | 626,986 | 581,823 | 627,373 | 620,611 | 622,924 | |
Additional Paid-in Capital | Adjustment | |||||||||||
Changes in Stockholders' (Deficit) Equity | |||||||||||
Balance | (606) | (553) | (525) | (525) | (525) | (525) | |||||
Stock-based compensation expense, net | (28) | (53) | (28) | (486) | (81) | (109) | (486) | (525) | |||
Balance | (634) | (606) | (553) | (486) | (606) | (634) | (486) | (525) | |||
Accumulated Deficit | |||||||||||
Changes in Stockholders' (Deficit) Equity | |||||||||||
Balance | (595,532) | (586,088) | (577,973) | (523,590) | (519,701) | (577,973) | (514,827) | (577,973) | (514,827) | (577,973) | (514,827) |
Net loss | (12,186) | (9,444) | (8,115) | (17,134) | (3,889) | (17,559) | (8,763) | (29,745) | (25,897) | (46,214) | (63,146) |
Balance | (607,718) | (595,532) | (586,088) | (540,724) | (523,590) | (595,532) | (523,590) | (607,718) | (540,724) | (624,187) | (577,973) |
Accumulated Deficit | As Previously Reported | |||||||||||
Changes in Stockholders' (Deficit) Equity | |||||||||||
Balance | (594,551) | (584,975) | (576,760) | (523,603) | (519,701) | (576,760) | (514,827) | (576,760) | (514,827) | (576,760) | (514,827) |
Net loss | (11,811) | (9,576) | (8,215) | (17,699) | (3,902) | (17,791) | (8,776) | (29,602) | (26,475) | (61,933) | |
Balance | (606,362) | (594,551) | (584,975) | (541,302) | (523,603) | (594,551) | (523,603) | (606,362) | (541,302) | (576,760) | |
Accumulated Deficit | Adjustment | |||||||||||
Changes in Stockholders' (Deficit) Equity | |||||||||||
Balance | (981) | (1,113) | (1,213) | 13 | (1,213) | (1,213) | $ (1,213) | ||||
Net loss | (375) | 132 | 100 | 565 | 13 | 232 | 13 | (143) | 578 | (1,213) | |
Balance | $ (1,356) | $ (981) | $ (1,113) | $ 578 | $ 13 | $ (981) | $ 13 | $ (1,356) | $ 578 | $ (1,213) |
2021 Restatement and Other Co_8
2021 Restatement and Other Corrections of Previously Issued Consolidated Financial Statements - Effect of Revision on Consolidated Statement of Cash Flow (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | |||
Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||
Net loss | $ (17,559) | $ (8,115) | $ (8,763) | $ (29,745) | $ (25,897) | $ (46,214) | $ (63,146) |
Stock-based compensation | 1,489 | 719 | 1,848 | 9,971 | 2,087 | 12,227 | |
Deferred income tax | (368) | (423) | (248) | ||||
Prepaid expenses and other current assets | 36 | (83) | 1,141 | (76) | |||
Accounts payable and accrued liabilities | 1,500 | 240 | (51) | $ 448 | (1,280) | ||
As Previously Reported | |||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||
Net loss | (17,791) | (8,215) | (8,776) | (29,602) | (26,475) | (61,933) | |
Stock-based compensation | 1,570 | 747 | 1,957 | 10,457 | 12,752 | ||
Deferred income tax | (188) | (187) | (555) | (60) | |||
Prepaid expenses and other current assets | (267) | (399) | (393) | ||||
Accounts payable and accrued liabilities | 1,681 | 420 | 129 | (1,480) | |||
Other | 158 | 79 | 316 | 237 | 408 | 488 | |
Adjustment | |||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||
Net loss | 232 | 100 | 13 | (143) | 578 | (1,213) | |
Stock-based compensation | (81) | (28) | (109) | (486) | (525) | ||
Deferred income tax | 188 | 187 | 187 | (188) | |||
Prepaid expenses and other current assets | 303 | 316 | 317 | ||||
Accounts payable and accrued liabilities | (181) | (180) | (180) | 200 | |||
Other | $ (158) | $ (79) | $ (316) | $ (237) | $ (408) | $ (488) |
2022 Restatement and Other Co_3
2022 Restatement and Other Corrections of Previously Issued Condensed Consolidated Financial Statements (Unaudited) - Effect of Revision on Condensed Consolidated Balance Sheet (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||
Prepaid expenses and other current assets | $ 165 | $ 610 | $ 953 | $ 1,443 | $ 1,305 | $ 1,317 | $ 1,069 | ||
Total current assets | 9,911 | 13,257 | 19,171 | 23,311 | 29,938 | 37,273 | 65,303 | ||
Other intangible assets, net | 260 | 12,031 | 20,827 | ||||||
Other assets | 46 | 46 | 46 | 46 | 46 | 46 | 46 | ||
Total assets | 11,142 | 26,485 | 40,357 | 45,623 | 52,531 | 90,790 | 120,013 | ||
Accrued and other liabilities | 5,040 | 4,867 | 5,833 | 3,482 | 3,368 | ||||
Total current liabilities | 7,481 | 7,532 | 9,209 | 8,170 | 7,530 | ||||
Total liabilities | 7,481 | 7,532 | 9,581 | 8,664 | 8,197 | ||||
Additional paid-in capital | 627,935 | 626,739 | 626,380 | 623,118 | 622,399 | 620,125 | |||
Accumulated deficit | (624,187) | (607,718) | (595,532) | (586,088) | (577,973) | (540,724) | (523,590) | ||
Total stockholders' equity | 3,661 | 18,953 | 30,776 | 36,959 | 44,334 | 79,312 | 58,132 | $ 12,708 | $ 14,488 |
Total liabilities and stockholders' equity | $ 11,142 | 26,485 | 40,357 | 45,623 | 52,531 | 90,790 | 120,013 | ||
As Previously Reported | |||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||
Prepaid expenses and other current assets | 926 | 1,269 | 1,759 | 1,622 | 1,633 | 1,371 | |||
Total current assets | 13,573 | 19,487 | 23,627 | 30,255 | 37,589 | 65,605 | |||
Other intangible assets, net | 12,513 | ||||||||
Other assets | 1,219 | 1,298 | 1,377 | 1,456 | 1,535 | 1,628 | |||
Total assets | 28,456 | 41,925 | 47,270 | 54,258 | 90,698 | 120,000 | |||
Accrued and other liabilities | 4,848 | 5,814 | 3,463 | 3,169 | |||||
Total current liabilities | 7,513 | 9,190 | 8,151 | 7,331 | |||||
Total liabilities | 7,513 | 9,562 | 8,645 | 8,186 | |||||
Additional paid-in capital | 627,373 | 626,986 | 623,671 | 622,924 | 620,611 | ||||
Accumulated deficit | (606,362) | (594,551) | (584,975) | (576,760) | (541,302) | (523,603) | |||
Total stockholders' equity | 20,943 | 32,363 | 38,625 | 46,072 | 79,220 | 58,119 | $ 12,708 | $ 14,488 | |
Total liabilities and stockholders' equity | 28,456 | 41,925 | 47,270 | 54,258 | 90,698 | 120,000 | |||
Adjustment | |||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||
Prepaid expenses and other current assets | (316) | (316) | (316) | (317) | (316) | (302) | |||
Total current assets | (316) | (316) | (316) | (317) | (316) | (302) | |||
Other intangible assets, net | (482) | ||||||||
Other assets | (1,173) | (1,252) | (1,331) | (1,410) | (1,489) | (1,582) | |||
Total assets | (1,971) | (1,568) | (1,647) | (1,727) | 92 | 13 | |||
Accrued and other liabilities | 19 | 19 | 19 | 199 | |||||
Total current liabilities | 19 | 19 | 19 | 199 | |||||
Total liabilities | 19 | 19 | 19 | 11 | |||||
Additional paid-in capital | (634) | (606) | (553) | (525) | (486) | ||||
Accumulated deficit | (1,356) | (981) | (1,113) | (1,213) | 578 | 13 | |||
Total stockholders' equity | (1,990) | (1,587) | (1,666) | (1,738) | 92 | 13 | |||
Total liabilities and stockholders' equity | $ (1,971) | $ (1,568) | $ (1,647) | $ (1,727) | $ 92 | $ 13 |
2022 Restatement and Other Co_4
2022 Restatement and Other Corrections of Previously Issued Condensed Consolidated Financial Statements (Unaudited) - Effect of Revision on Condensed Consolidated Statement of Operations (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||
Revenue | $ 11,240 | $ 13,600 | ||||||||||
Cost of revenue | 4,438 | 5,252 | ||||||||||
Gross profit | 6,802 | 8,348 | ||||||||||
Operating expenses: | ||||||||||||
Sales and marketing | $ 2,605 | $ 4,636 | $ 4,694 | $ 3,246 | $ 9,330 | $ 11,936 | $ 5,937 | 14,093 | 8,893 | |||
General and administrative | 3,784 | 5,363 | 3,892 | 11,883 | $ 4,298 | 9,254 | $ 7,018 | 13,037 | 18,902 | 17,250 | 24,319 | |
Research and development | 583 | 747 | 745 | 1,425 | 1,492 | 2,075 | 2,099 | 2,537 | 2,369 | |||
Loss on impairment of intangible assets and goodwill | 7,429 | 7,429 | 18,744 | 30,649 | ||||||||
Total operating expenses | 14,402 | 11,127 | 9,331 | 16,554 | 5,842 | 20,457 | 10,383 | 34,860 | 26,938 | 53,153 | 66,230 | |
Operating loss | (12,301) | (9,244) | (8,113) | (14,419) | (3,689) | (17,356) | (5,947) | (29,658) | (20,366) | (46,351) | (57,882) | |
Loss before income tax provision | (12,549) | (9,435) | (8,085) | (17,164) | (3,861) | (17,520) | (8,710) | (30,069) | (25,874) | (46,594) | (63,420) | |
Income tax benefit | (363) | 9 | 30 | 39 | (324) | (380) | (274) | |||||
Net loss | $ 12,186 | $ 9,444 | $ 8,115 | $ 17,134 | $ 3,889 | $ 17,559 | $ 8,763 | $ 29,745 | $ 25,897 | $ 46,214 | $ 63,146 | |
Net loss per share - basic and diluted: | ||||||||||||
Net loss per share - basic (in dollars per share) | $ (27.01) | $ (24.45) | $ (21.87) | $ (50.13) | $ (42.70) | $ (61.88) | $ (46.37) | $ (103.19) | $ (73.79) | $ (150.31) | $ (108.90) | $ (288.97) |
Net loss per share - diluted (in dollars per share) | $ (27.01) | $ (24.59) | $ (21.87) | $ (50.13) | $ (42.70) | $ (61.88) | $ (46.37) | $ (103.19) | $ (73.79) | $ (150.31) | $ (108.90) | $ (288.97) |
Shares used to compute basic net loss per share | 371,031 | 341,768 | 91,080 | 78,763 | 84,921 | 172,288 | 424,390 | 218,522 | ||||
Shares used to compute diluted net loss per share | 371,031 | 341,768 | 91,080 | 78,763 | 84,921 | 172,288 | 424,390 | 218,522 | ||||
As Previously Reported | ||||||||||||
Operating expenses: | ||||||||||||
Sales and marketing | $ 2,619 | $ 4,663 | $ 4,707 | $ 3,496 | $ 9,371 | $ 11,990 | $ 6,186 | $ 9,165 | ||||
General and administrative | 3,872 | 5,454 | 4,163 | 12,052 | $ 4,311 | 9,616 | $ 7,031 | 13,488 | 19,085 | 24,410 | ||
Research and development | 588 | 761 | 748 | 1,571 | 1,508 | 2,096 | 2,245 | 2,522 | ||||
Loss on impairment of intangible assets and goodwill | 6,947 | 6,947 | 28,752 | |||||||||
Total operating expenses | 14,027 | 11,259 | 9,618 | 17,119 | 5,855 | 20,876 | 10,396 | 34,904 | 27,516 | 64,849 | ||
Operating loss | (11,926) | (9,376) | (8,400) | (14,984) | (3,702) | (17,775) | (5,960) | (29,702) | (20,944) | (56,501) | ||
Loss before income tax provision | (12,174) | (9,567) | (8,372) | (17,729) | (3,874) | (17,939) | (8,723) | (30,113) | (26,452) | (62,039) | ||
Income tax benefit | (363) | 9 | (157) | (148) | (511) | (106) | ||||||
Net loss | $ 11,811 | $ 9,576 | $ 8,215 | $ 17,699 | $ 3,902 | $ 17,791 | $ 8,776 | $ 29,602 | $ 26,475 | $ 61,933 | ||
Net loss per share - basic and diluted: | ||||||||||||
Net loss per share - basic (in dollars per share) | $ (26.18) | $ (24.79) | $ (22.16) | $ (73.76) | $ (23.72) | $ (62.04) | $ (46.98) | $ (55.34) | $ (73.43) | $ (125.43) | $ (250.16) | |
Net loss per share - diluted (in dollars per share) | $ (26.18) | $ (24.79) | $ (22.16) | $ (73.76) | $ (23.72) | $ (62.04) | $ (46.98) | $ (55.34) | $ (73.43) | $ (125.51) | $ (250.16) | |
Shares used to compute basic net loss per share | 370,792 | 239,948 | 164,523 | 78,560 | 158,575 | 210,934 | 247,571 | |||||
Shares used to compute diluted net loss per share | 370,792 | 239,948 | 164,523 | 78,560 | 158,575 | 210,934 | 247,571 | |||||
Adjustment | ||||||||||||
Operating expenses: | ||||||||||||
Sales and marketing | $ (14) | $ (27) | $ (13) | $ (250) | $ (41) | $ (54) | $ (249) | $ (272) | ||||
General and administrative | (88) | (91) | (271) | (169) | $ (13) | (362) | $ (13) | (451) | (183) | (91) | ||
Research and development | (5) | (14) | (3) | (146) | (16) | (21) | (146) | (153) | ||||
Loss on impairment of intangible assets and goodwill | 482 | 482 | 1,897 | |||||||||
Total operating expenses | 375 | (132) | (287) | (565) | (13) | (419) | (13) | (44) | (578) | 1,381 | ||
Operating loss | (375) | 132 | 287 | 565 | 13 | 419 | 13 | 44 | 578 | (1,381) | ||
Loss before income tax provision | (375) | 132 | 287 | 565 | 13 | 419 | 13 | 44 | 578 | (1,381) | ||
Income tax benefit | 187 | 187 | 187 | (168) | ||||||||
Net loss | $ 375 | $ (132) | $ (100) | $ (565) | $ (13) | $ (232) | $ (13) | $ 143 | $ (578) | $ 1,213 | ||
Net loss per share - basic and diluted: | ||||||||||||
Net loss per share - basic (in dollars per share) | $ (0.83) | $ 0.34 | $ 0.29 | $ 23.63 | $ (18.98) | $ 0.16 | $ 0.61 | $ (47.85) | $ (0.36) | $ (24.88) | $ (38.81) | |
Net loss per share - diluted (in dollars per share) | $ (0.83) | $ 0.20 | $ (0.29) | $ 23.63 | $ (18.98) | $ 0.16 | $ 0.61 | $ (47.85) | $ (0.36) | $ (24.80) | $ (38.81) | |
Shares used to compute basic net loss per share | 239 | 101,820 | (73,443) | 203 | (73,654) | (38,646) | (29,049) | |||||
Shares used to compute diluted net loss per share | 239 | 101,820 | (73,443) | 203 | (73,654) | (38,646) | (29,049) | |||||
Adjustment | BarioSurg, ReShape Vest, Tradenames | ||||||||||||
Operating expenses: | ||||||||||||
Loss on impairment of intangible assets and goodwill | $ 500 |
2022 Restatement and Other Co_5
2022 Restatement and Other Corrections of Previously Issued Condensed Consolidated Financial Statements (Unaudited) - Effect of Revision on Condensed Consolidated Statement of of Other Comprehensive Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | |||||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Net loss | $ (12,186) | $ (9,444) | $ (8,115) | $ (17,134) | $ (3,889) | $ (17,559) | $ (8,763) | $ (29,745) | $ (25,897) | $ (46,214) | $ (63,146) |
Comprehensive loss | (12,182) | (9,445) | (8,094) | (17,132) | (3,896) | (17,539) | (8,751) | (29,721) | (25,883) | $ (46,210) | (63,117) |
As Previously Reported | |||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Net loss | (11,811) | (9,576) | (8,215) | (17,699) | (3,902) | (17,791) | (8,776) | (29,602) | (26,475) | (61,933) | |
Comprehensive loss | (11,807) | (9,577) | (8,194) | (17,697) | (3,909) | (17,771) | (8,764) | (29,578) | (26,461) | (61,904) | |
Adjustment | |||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Net loss | (375) | 132 | 100 | 565 | 13 | 232 | 13 | (143) | 578 | (1,213) | |
Comprehensive loss | $ (375) | $ 132 | $ 100 | $ 565 | $ 13 | $ 232 | $ 13 | $ (143) | $ 578 | $ (1,213) |
2022 Restatement and Other Co_6
2022 Restatement and Other Corrections of Previously Issued Condensed Consolidated Financial Statements (Unaudited) - Effect of Revision on Condensed Consolidated Statement of Stockholders Equity (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | |||||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Changes in Stockholders' (Deficit) Equity | |||||||||||
Balance | $ 30,776 | $ 36,959 | $ 44,334 | $ 58,132 | $ 12,708 | $ 44,334 | $ 14,488 | $ 44,334 | $ 14,488 | $ 44,334 | $ 14,488 |
Net loss | (12,186) | (9,444) | (8,115) | (17,134) | (3,889) | (17,559) | (8,763) | (29,745) | (25,897) | (46,214) | (63,146) |
Stock-based compensation expense, net | 359 | 770 | 719 | 10,234 | 1,489 | 1,848 | 9,971 | 2,087 | 12,227 | ||
Balance | 18,953 | 30,776 | 36,959 | 79,312 | 58,132 | 30,776 | 58,132 | 18,953 | 79,312 | 3,661 | 44,334 |
As Previously Reported | |||||||||||
Changes in Stockholders' (Deficit) Equity | |||||||||||
Balance | 32,363 | 38,625 | 46,072 | 58,119 | 12,708 | 46,072 | 14,488 | 46,072 | 14,488 | 46,072 | 14,488 |
Net loss | (11,811) | (9,576) | (8,215) | (17,699) | (3,902) | (17,791) | (8,776) | (29,602) | (26,475) | (61,933) | |
Stock-based compensation expense, net | 387 | 823 | 747 | 10,720 | 1,570 | 1,957 | 10,457 | 12,752 | |||
Balance | 20,943 | 32,363 | 38,625 | 79,220 | 58,119 | 32,363 | 58,119 | 20,943 | 79,220 | 46,072 | |
Adjustment | |||||||||||
Changes in Stockholders' (Deficit) Equity | |||||||||||
Balance | (1,587) | (1,666) | (1,738) | 13 | (1,738) | (1,738) | (1,738) | ||||
Net loss | (375) | 132 | 100 | 565 | 13 | 232 | 13 | (143) | 578 | (1,213) | |
Stock-based compensation expense, net | (28) | (53) | (28) | (486) | (81) | (109) | (486) | (525) | |||
Balance | (1,990) | (1,587) | (1,666) | 92 | 13 | (1,587) | 13 | (1,990) | 92 | (1,738) | |
Additional Paid-in Capital | |||||||||||
Changes in Stockholders' (Deficit) Equity | |||||||||||
Balance | 626,380 | 623,118 | 622,399 | 581,823 | 532,504 | 622,399 | 529,435 | 622,399 | 529,435 | 622,399 | 529,435 |
Stock-based compensation expense, net | 359 | 770 | 719 | 10,234 | 1,489 | 1,848 | 9,971 | 2,087 | 12,227 | ||
Balance | 626,739 | 626,380 | 623,118 | 620,125 | 581,823 | 626,380 | 581,823 | 626,739 | 620,125 | 627,935 | 622,399 |
Additional Paid-in Capital | As Previously Reported | |||||||||||
Changes in Stockholders' (Deficit) Equity | |||||||||||
Balance | 626,986 | 623,671 | 622,924 | 581,823 | 532,504 | 622,924 | 529,435 | 622,924 | 529,435 | 622,924 | 529,435 |
Stock-based compensation expense, net | 387 | 823 | 747 | 10,720 | 1,570 | 1,957 | 10,457 | 12,752 | |||
Balance | 627,373 | 626,986 | 623,671 | 620,611 | 581,823 | 626,986 | 581,823 | 627,373 | 620,611 | 622,924 | |
Additional Paid-in Capital | Adjustment | |||||||||||
Changes in Stockholders' (Deficit) Equity | |||||||||||
Balance | (606) | (553) | (525) | (525) | (525) | (525) | |||||
Stock-based compensation expense, net | (28) | (53) | (28) | (486) | (81) | (109) | (486) | (525) | |||
Balance | (634) | (606) | (553) | (486) | (606) | (634) | (486) | (525) | |||
Accumulated Deficit | |||||||||||
Changes in Stockholders' (Deficit) Equity | |||||||||||
Balance | (595,532) | (586,088) | (577,973) | (523,590) | (519,701) | (577,973) | (514,827) | (577,973) | (514,827) | (577,973) | (514,827) |
Net loss | (12,186) | (9,444) | (8,115) | (17,134) | (3,889) | (17,559) | (8,763) | (29,745) | (25,897) | (46,214) | (63,146) |
Balance | (607,718) | (595,532) | (586,088) | (540,724) | (523,590) | (595,532) | (523,590) | (607,718) | (540,724) | (624,187) | (577,973) |
Accumulated Deficit | As Previously Reported | |||||||||||
Changes in Stockholders' (Deficit) Equity | |||||||||||
Balance | (594,551) | (584,975) | (576,760) | (523,603) | (519,701) | (576,760) | (514,827) | (576,760) | (514,827) | (576,760) | (514,827) |
Net loss | (11,811) | (9,576) | (8,215) | (17,699) | (3,902) | (17,791) | (8,776) | (29,602) | (26,475) | (61,933) | |
Balance | (606,362) | (594,551) | (584,975) | (541,302) | (523,603) | (594,551) | (523,603) | (606,362) | (541,302) | (576,760) | |
Accumulated Deficit | Adjustment | |||||||||||
Changes in Stockholders' (Deficit) Equity | |||||||||||
Balance | (981) | (1,113) | (1,213) | 13 | (1,213) | (1,213) | $ (1,213) | ||||
Net loss | (375) | 132 | 100 | 565 | 13 | 232 | 13 | (143) | 578 | (1,213) | |
Balance | $ (1,356) | $ (981) | $ (1,113) | $ 578 | $ 13 | $ (981) | $ 13 | $ (1,356) | $ 578 | $ (1,213) |
2022 Restatement and Other Co_7
2022 Restatement and Other Corrections of Previously Issued Condensed Consolidated Financial Statements (Unaudited) - Effect of Revision on Condensed Consolidated Statement of Cash Flow (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||
Net loss | $ (17,559) | $ (8,115) | $ (8,763) | $ (29,745) | $ (25,897) | $ (46,214) | $ (63,146) | |
Loss on impairment of intangible assets and goodwill | $ 7,429 | 7,429 | 18,744 | 30,649 | ||||
Stock-based compensation | 1,489 | 719 | 1,848 | 9,971 | 2,087 | 12,227 | ||
Deferred income tax | (368) | (423) | (248) | |||||
Accounts payable and accrued liabilities | 1,500 | 240 | (51) | $ 448 | (1,280) | |||
As Previously Reported | ||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||
Net loss | (17,791) | (8,215) | (8,776) | (29,602) | (26,475) | (61,933) | ||
Loss on impairment of intangible assets and goodwill | 6,947 | 6,947 | 28,752 | |||||
Stock-based compensation | 1,570 | 747 | 1,957 | 10,457 | 12,752 | |||
Deferred income tax | (188) | (187) | (555) | (60) | ||||
Accounts payable and accrued liabilities | 1,681 | 420 | 129 | (1,480) | ||||
Other | 158 | 79 | 316 | 237 | 408 | 488 | ||
Adjustment | ||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||
Net loss | 232 | 100 | 13 | (143) | 578 | (1,213) | ||
Loss on impairment of intangible assets and goodwill | $ 482 | 482 | 1,897 | |||||
Stock-based compensation | (81) | (28) | (109) | (486) | (525) | |||
Deferred income tax | 188 | 187 | 187 | (188) | ||||
Accounts payable and accrued liabilities | (181) | (180) | (180) | 200 | ||||
Other | $ (158) | $ (79) | $ (316) | $ (237) | $ (408) | $ (488) |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Reverse Stock Splits, Cash, A/R, Inventory (Details) $ in Thousands | 12 Months Ended | ||||
Dec. 23, 2022 | Jun. 15, 2021 | Dec. 31, 2022 USD ($) customer | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Reverse stock split ratio | 0.02 | 0.333 | |||
Cash and cash equivalents | $ 3,855 | $ 22,765 | |||
Restricted cash | 100 | 50 | |||
Total cash, cash equivalents, and restricted cash in the consolidated statement of cash flows | 3,955 | 22,815 | $ 3,007 | ||
Allowance for excess and slow moving inventory | $ 1,000 | $ 800 | |||
Number of customers | customer | 1 | ||||
Reserves recorded against outstanding balance | $ 100 | ||||
Obalon Therapeutics Inc. | |||||
Stock exchange ratio | 0.5367 | ||||
Accounts receivable | Customer Concentration Risk | Customer One | |||||
Percentage of total | 20.40% | ||||
Minimum | |||||
Payment period for accounts receivable | 30 days | ||||
Maximum | |||||
Payment period for accounts receivable | 90 days |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Property and Equipment Useful Lives (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Furniture and equipment | Minimum | |
Property and equipment | |
Property and equipment estimated useful life | 5 years |
Furniture and equipment | Maximum | |
Property and equipment | |
Property and equipment estimated useful life | 7 years |
Computer hardware and software | Minimum | |
Property and equipment | |
Property and equipment estimated useful life | 3 years |
Computer hardware and software | Maximum | |
Property and equipment | |
Property and equipment estimated useful life | 5 years |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Revenue Recognition (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Revenue Recognition | ||
Restocking fee (as a percent) | 10% | |
Warranty term | 30 days | |
Advertising cost | $ 6.8 | $ 3 |
LAP-BAND product | Maximum | ||
Revenue Recognition | ||
Threshold period for right to return or exchange products purchased | 30 days | |
ReShape vBloc product | ||
Revenue Recognition | ||
Warranty term | 5 years |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Anti-dilutive Securities (Details) - shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Stock options | ||
Anti-dilutive securities | ||
Anti-dilutive securities (in shares) | 21,416 | 17,701 |
Unvested restricted stock units | ||
Anti-dilutive securities | ||
Anti-dilutive securities (in shares) | 4,530 | 34,227 |
Convertible preferred stock | ||
Anti-dilutive securities | ||
Anti-dilutive securities (in shares) | 10 | 10 |
Warrants | ||
Anti-dilutive securities | ||
Anti-dilutive securities (in shares) | 193,476 | 139,047 |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Credit Risk Concentration (Details) | 12 Months Ended |
Dec. 31, 2022 $ / shares | |
Concentration of credit risk | |
Concentration risk | |
Money market funds preserve the value of investment per share | $ 1 |
Liquidity and Management Plans
Liquidity and Management Plans (as Restated) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||||||
Feb. 08, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Dec. 31, 2020 | |
Liquidity, Going Concern and Management's Plans | |||||||||
Working capital | $ 2,400 | ||||||||
Cash and cash equivalents and restricted cash | 3,955 | $ 22,815 | $ 3,007 | ||||||
Accounts receivable | 2,180 | 2,815 | |||||||
Accumulated deficit | (624,187) | $ (607,718) | $ (595,532) | $ (586,088) | $ (577,973) | $ (540,724) | $ (523,590) | ||
Gross proceeds from issuance of shares | $ 639 | ||||||||
Public offering | |||||||||
Liquidity, Going Concern and Management's Plans | |||||||||
Gross proceeds from issuance of shares | $ 9,400 |
Supplemental Balance Sheet In_3
Supplemental Balance Sheet Information (as Restated) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 |
Inventory: | |||||||
Raw materials | $ 832 | $ 829 | |||||
Sub-assemblies | 864 | 682 | |||||
Finished goods | 1,915 | 1,492 | |||||
Total inventory | 3,611 | 3,003 | |||||
Prepaid expenses and other current assets: | |||||||
Prepaid insurance | 78 | 419 | |||||
Prepaid advertising and marketing | 3 | 698 | |||||
Other current assets | 84 | 188 | |||||
Total prepaid expenses and other current assets | 165 | $ 610 | $ 953 | $ 1,443 | 1,305 | $ 1,317 | $ 1,069 |
Accrued and other liabilities: | |||||||
Payroll and benefits | 1,829 | 1,527 | |||||
Accrued legal settlements | 1,775 | 180 | |||||
Customer deposits | 510 | 549 | |||||
Taxes | 119 | 326 | |||||
Accrued insurance premium | 301 | ||||||
Accrued professional | 316 | 300 | |||||
Other liabilities | 491 | 185 | |||||
Total accrued and other liabilities | $ 5,040 | $ 4,867 | $ 5,833 | $ 3,482 | $ 3,368 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Property and equipment | ||
Property and Equipment, Gross | $ 1,029 | $ 1,794 |
Less accumulated depreciation and amortization | (331) | (340) |
Property and equipment, net | 698 | 1,454 |
Depreciation | 330 | 232 |
Machinery and equipment | ||
Property and equipment | ||
Property and Equipment, Gross | 582 | 955 |
Furniture and equipment | ||
Property and equipment | ||
Property and Equipment, Gross | 27 | 38 |
Computer hardware and software | ||
Property and equipment | ||
Property and Equipment, Gross | 136 | 135 |
Tooling and molds | ||
Property and equipment | ||
Property and Equipment, Gross | 199 | 236 |
Leasehold improvements | ||
Property and equipment | ||
Property and Equipment, Gross | 19 | 23 |
Construction in progress | ||
Property and equipment | ||
Property and Equipment, Gross | $ 66 | $ 407 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets (as Restated) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2022 | |
Acquisition. | |||
Gross Carrying Amount | $ 6,451 | $ 19,213 | |
Gross Carrying amount | 26,160 | ||
Accumulated amortization | (6,191) | (5,333) | |
Total finite-lived intangible assets | 260 | 13,880 | |
Indefinite-lived intangible assets | 6,947 | ||
Net book value | 260 | 20,827 | $ 12,031 |
Amortization expense | 1,823 | $ 1,739 | |
Obalon Therapeutics Inc. | |||
Acquisition. | |||
Goodwill acquired during the year | $ 23,500 | ||
Developed technology | |||
Acquisition. | |||
Weighted Average Useful Life (years) | 10 years | 10 years 9 months 18 days | |
Gross Carrying Amount | $ 5,989 | $ 17,092 | |
Accumulated amortization | (5,805) | (4,467) | |
Total finite-lived intangible assets | $ 184 | $ 12,625 | |
Trademarks/Tradenames | |||
Acquisition. | |||
Weighted Average Useful Life (years) | 10 years | 10 years | |
Gross Carrying Amount | $ 462 | $ 2,045 | |
Accumulated amortization | (386) | (790) | |
Total finite-lived intangible assets | 76 | $ 1,255 | |
Covenant not to compete | |||
Acquisition. | |||
Weighted Average Useful Life (years) | 3 years | ||
Gross Carrying Amount | $ 76 | ||
Accumulated amortization | (76) | ||
In-process research and development | |||
Acquisition. | |||
Indefinite-lived intangible assets | $ 0 | $ 6,947 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets (as Restated) - Gross Amount and Accumulated Impairment Loss (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Goodwill and Intangible Assets (as Restated) | ||
Gross amount | $ 20,721 | $ 20,721 |
Accumulated impairment loss | $ (20,721) | (13,774) |
Indefinite-lived intangible assets, net | $ 6,947 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets (as Restated) - Expected Amortization (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Estimated amortization of intangible assets | ||
2023 | $ 44 | |
2024 | 44 | |
2025 | 44 | |
2026 | 44 | |
2027 | 44 | |
Thereafter | 40 | |
Total finite-lived intangible assets | $ 260 | $ 13,880 |
Impairment of Intangible Asse_2
Impairment of Intangible Assets and Goodwill (as Restated) (Details) - USD ($) $ in Thousands | 7 Months Ended | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Acquisition. | |||
Impairment of intangible assets | $ 18,744 | $ 30,649 | |
Finite-lived intangible assets impairment | 7,200 | ||
Indefinite-lived intangible assets | $ 6,947 | $ 6,947 | |
Impairment, Intangible Asset, Finite-Lived, Statement of Income or Comprehensive Income [Extensible Enumeration] | Goodwill and Intangible Asset Impairment | ||
Discount rate | 17.90% | 21.70% | |
Goodwill impairment | $ 23,500 | ||
Obalon Therapeutics Inc. | |||
Acquisition. | |||
Impairment of intangible assets | $ 2,400 | ||
Goodwill impairment | 23,500 | ||
In-process research and development | |||
Acquisition. | |||
Impairment of intangible assets | 6,900 | ||
Indefinite-lived intangible assets | $ 6,947 | 0 | $ 6,947 |
Trademarks/Tradenames | |||
Acquisition. | |||
Impairment of intangible assets | 500 | ||
Trademarks/Tradenames | LAP-BAND product | |||
Acquisition. | |||
Impairment of intangible assets | 500 | ||
Developed technology | LAP-BAND product | |||
Acquisition. | |||
Impairment of intangible assets | $ 8,400 |
Debt - CARES Act (Details)
Debt - CARES Act (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Apr. 24, 2020 | Dec. 31, 2021 | |
Debt Instrument [Line Items] | ||
Gain on extinguishment of debt | $ (2,061) | |
Employee retention credit | $ 500 | |
PPP loan | ||
Debt Instrument [Line Items] | ||
Amount received | $ 1,000 | |
Discount rate (as a percent) | 1% |
Debt - Credit agreement (Detail
Debt - Credit agreement (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Jun. 28, 2021 | Jan. 19, 2021 | Dec. 31, 2021 | Dec. 31, 2022 | |
Short-term Debt [Line Items] | ||||
Debt discount | $ 494 | |||
Loss on extinguishment of debt, net | 2,061 | |||
Payment of credit agreement | $ 10,500 | |||
Series G Warrants | ||||
Short-term Debt [Line Items] | ||||
Number of shares in exchange of warrant exercise | 11,274 | |||
Credit agreement | ||||
Short-term Debt [Line Items] | ||||
Additional borrowing amount | $ 1,000 | |||
New debt fair value | 10,000 | |||
Unamortized debt discount | 500 | |||
Loss on extinguishment of debt, net | 3,000 | |||
Payment of credit agreement | $ 10,500 | |||
Termination fees | $ 1,000 | |||
Credit agreement | Series G Warrants | ||||
Short-term Debt [Line Items] | ||||
Number of shares in exchange of warrant exercise | 20,000 | |||
Credit agreement | LIBOR | ||||
Short-term Debt [Line Items] | ||||
Credit facility bear interest | 2.50% | |||
Credit agreement fourth amendment | ||||
Short-term Debt [Line Items] | ||||
Total debt | $ 0 | |||
Credit agreement fifth amendment | ||||
Short-term Debt [Line Items] | ||||
Unamortized debt discount | $ 100 |
Leases - Supplemental Informati
Leases - Supplemental Information (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Mar. 13, 2023 ft² | |
Operating lease costs | $ 700 | $ 600 | |
Balance Sheet information related to operating leases | |||
Operating lease ROU assets | 171 | 266 | |
Operating lease liabilities, current | 171 | 279 | |
Total operating lease liabilities | 171 | 279 | |
Cash flow information related to operating leases | |||
Cash paid for amounts included in the measurement of operating leases liabilities | $ 560 | $ 565 | |
Irvine, California, Office and Warehouse Space | |||
Lease term | 36 months | ||
Irvine, California, Office and Warehouse Space | Subsequent Event | |||
Lease renewal term | 36 months | ||
Area of land | ft² | 5,038 |
Leases - Maturities of Liabilit
Leases - Maturities of Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Maturities of operating lease liabilities | ||
2023 | $ 174 | |
Total lease payments | 174 | |
Less: imputed interest | 3 | |
Total lease liabilities | $ 171 | $ 279 |
Weighted-average remaining lease term at end of period (in years) | 6 months | |
Weighted-average discount rate at end of period | 5.10% |
Acquisition (as Restated) (Deta
Acquisition (as Restated) (Details) - Obalon Therapeutics Inc. - USD ($) $ in Millions | 12 Months Ended | |
Jun. 15, 2021 | Dec. 31, 2021 | |
Acquisitions | ||
Aggregate purchase price | $ 30.6 | |
Issuance of shares of common stock | 66,801 | |
Shares issued value | $ 30.6 | |
Cancellation of shares | 53,607 | |
General and administrative expense | ||
Acquisitions | ||
Acquisition related costs | $ 2.3 |
Acquisition (as Restated) - Fai
Acquisition (as Restated) - Fair value of assets acquired and liabilities assumed (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Jun. 15, 2021 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | |
Fair values of the assets acquired and liabilities assumed | ||||
Goodwill | $ 22,950 | $ 23,520 | ||
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 | |||
Goodwill | 23,463 | |||
Developed technology | 2,730 | |||
Liabilities assumed | (2,650) | |||
Total purchase price | 30,561 | |||
Less: cash acquired | (5,207) | |||
Total purchase price, net of cash acquired | $ 25,354 |
Acquisition (as Restated) - Nar
Acquisition (as Restated) - Narrative (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | 7 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||
Jul. 15, 2021 USD ($) item $ / shares | Jun. 15, 2021 USD ($) | Sep. 30, 2022 USD ($) | Jun. 30, 2022 USD ($) | Mar. 31, 2022 USD ($) | Sep. 30, 2021 USD ($) | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Acquisition. | ||||||||||||||
Warrant liability | $ 1,300 | $ 2,000 | ||||||||||||
Decrease in warrant liability | $ (700) | $ (371) | $ (703) | |||||||||||
Number of holders exercised fundamental transaction option | item | 1 | |||||||||||||
Fair value portion of warrants | $ 900 | |||||||||||||
Reclassification of warrants | $ 500 | |||||||||||||
Revenue | 11,240 | 13,600 | ||||||||||||
Net loss | $ (12,186) | $ (9,444) | $ (8,115) | $ (17,134) | $ (3,889) | $ (17,559) | $ (8,763) | $ (29,745) | $ (25,897) | $ (46,214) | (63,146) | |||
Goodwill impairment | 23,500 | |||||||||||||
Minimum | ||||||||||||||
Acquisition. | ||||||||||||||
Warrant exercise price (in dollars per share) | $ / shares | $ 13.20 | |||||||||||||
Maximum | ||||||||||||||
Acquisition. | ||||||||||||||
Warrant exercise price (in dollars per share) | $ / shares | $ 15 | |||||||||||||
Discount rate | Income approach | ||||||||||||||
Acquisition. | ||||||||||||||
Discount rate | 0.220 | |||||||||||||
Risk Free Rate | ||||||||||||||
Acquisition. | ||||||||||||||
Warrant fair value measurement inputs | 0.0044 | |||||||||||||
Volatility | ||||||||||||||
Acquisition. | ||||||||||||||
Warrant fair value measurement inputs | 1.221 | |||||||||||||
Expected dividends | ||||||||||||||
Acquisition. | ||||||||||||||
Warrant fair value measurement inputs | 0 | |||||||||||||
Obalon Therapeutics Inc. | ||||||||||||||
Acquisition. | ||||||||||||||
Revenue | $ 0 | $ 0 | $ 0 | |||||||||||
Net loss | (2,000) | |||||||||||||
Goodwill impairment | $ 23,500 | |||||||||||||
Obalon Therapeutics Inc. | Developed technology | ||||||||||||||
Acquisition. | ||||||||||||||
Useful life | 15 years |
Acquisition (as Restated) - Pro
Acquisition (as Restated) - Pro forma results of operations of acquisition (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2021 USD ($) | |
Acquisition (as Restated) | |
Revenue | $ 13,432 |
Net Loss | $ (71,178) |
Equity - Issuance of stock and
Equity - Issuance of stock and warrants (Details) - USD ($) | 12 Months Ended | ||||||||||||
Nov. 08, 2022 | Jun. 16, 2022 | Sep. 15, 2021 | Aug. 11, 2021 | Jul. 13, 2021 | Jun. 28, 2021 | Jun. 21, 2021 | Jun. 18, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Jun. 15, 2022 | Jul. 16, 2021 | Jul. 15, 2021 | |
Equity | |||||||||||||
Warrants exercise price expressed | 95% | ||||||||||||
Percentage of common stock issued | 75% | ||||||||||||
Proceeds from warrants exercised | $ 2,491,000 | $ 45,616,000 | |||||||||||
Payment of credit agreement | 10,500,000 | ||||||||||||
Common stock purchased (in shares) | 3,754 | 4,000 | |||||||||||
Stock options exercised (in shares) | 1,454 | 364 | 1,838 | 0 | |||||||||
Proceeds from stock options exercised | $ 200,000 | $ 42,000 | $ 200,000 | 417,000 | |||||||||
Common stock issued for professional services | $ 130,000 | ||||||||||||
Credit agreement | |||||||||||||
Equity | |||||||||||||
Payment of credit agreement | $ 10,500,000 | ||||||||||||
Minimum | |||||||||||||
Equity | |||||||||||||
Warrant exercise price (in dollars per share) | $ 13.20 | ||||||||||||
Maximum | |||||||||||||
Equity | |||||||||||||
Warrant exercise price (in dollars per share) | $ 15 | ||||||||||||
2019 private placement | |||||||||||||
Equity | |||||||||||||
Proceeds from warrants exercised | $ 100,000 | ||||||||||||
Restricted Shares | |||||||||||||
Equity | |||||||||||||
Common stock issued for professional services (in shares) | 750 | ||||||||||||
Contract expiration term | 6 months | ||||||||||||
Restricted stock units | |||||||||||||
Equity | |||||||||||||
Issuance of stock from RSUs (shares) | 28,769 | ||||||||||||
Issuance of stock for bonuses, shares | 28,769 | ||||||||||||
Number of common shares issued to vesting of awards | 50,131 | 37,986 | |||||||||||
Class Of Warrant Investors Issued June 2022 | |||||||||||||
Equity | |||||||||||||
Issuance of common stock upon exercise of warrants, net of transaction costs (in shares) | 74,773 | ||||||||||||
Proceeds from warrants exercised | $ 2,500,000 | ||||||||||||
June 2021 warrants | |||||||||||||
Equity | |||||||||||||
Issuance of common stock upon exercise of warrants, net of transaction costs (in shares) | 158,588 | ||||||||||||
Proceeds from warrants exercised | $ 45,500,000 | ||||||||||||
June 2021 warrants | Credit agreement | |||||||||||||
Equity | |||||||||||||
Proceeds to repay | 10,800,000 | ||||||||||||
Payment of credit agreement | 10,500,000 | ||||||||||||
Accrued interest | $ 300,000 | ||||||||||||
New Unregistered Warrants | |||||||||||||
Equity | |||||||||||||
Number of shares in exchange of warrant exercise | 74,773 | 118,941 | |||||||||||
Warrant exercise price (in dollars per share) | $ 300 | ||||||||||||
Issuance of common stock upon exercise of warrants, net of transaction costs (in shares) | 142,617 | ||||||||||||
Percentage of common stock issued | 100% | ||||||||||||
Cash purchase price per share | $ 33.33 | $ 4.69 | $ 300 | ||||||||||
Exchange Warrants | |||||||||||||
Equity | |||||||||||||
Number of shares in exchange of warrant exercise | 10,098 | ||||||||||||
Warrant exercise price (in dollars per share) | $ 201.90 | ||||||||||||
New Warrants | |||||||||||||
Equity | |||||||||||||
Warrant exercise price (in dollars per share) | $ 201.90 | ||||||||||||
Warrants term | 5 years | ||||||||||||
New Warrants | Maximum | |||||||||||||
Equity | |||||||||||||
Number of shares in exchange of warrant exercise | 8,000 | ||||||||||||
Series C convertible preferred stock | |||||||||||||
Equity | |||||||||||||
Preferred stock liquidation preference per share | $ 274.88 | ||||||||||||
Securities purchase agreement | |||||||||||||
Equity | |||||||||||||
Purchase price (in dollars per share) | $ 13 | ||||||||||||
Securities purchase agreement | Private Placement Warrants | |||||||||||||
Equity | |||||||||||||
Warrants term | 6 months | ||||||||||||
Common stock purchased (in shares) | 57,693 | ||||||||||||
Securities purchase agreement | Pre-funded warrants | |||||||||||||
Equity | |||||||||||||
Number of shares in exchange of warrant exercise | 9,841 | ||||||||||||
Warrant exercise price (in dollars per share) | $ 12.95 | ||||||||||||
Proceeds from issuance of common stock warrant liabilities, net of issuance costs of $1,442 | $ 750,000 | ||||||||||||
Securities purchase agreement | Common Stock | |||||||||||||
Equity | |||||||||||||
Common stock purchased (in shares) | 47,851 | ||||||||||||
Securities purchase agreement | Series D Mirroring Preferred Stock | |||||||||||||
Equity | |||||||||||||
Common stock purchased (in shares) | 2,500 | ||||||||||||
Purchase price (in dollars per share) | $ 0.001 | ||||||||||||
Warrant amendment agreement | |||||||||||||
Equity | |||||||||||||
Warrant exercise price (in dollars per share) | $ 15 | ||||||||||||
Warrant expiry term | 5 years 6 months | ||||||||||||
Purchase price (in dollars per share) | $ 33.33 | ||||||||||||
Warrant amendment agreement | Maximum | |||||||||||||
Equity | |||||||||||||
Number of shares in exchange of warrant exercise | 106,963 | ||||||||||||
Common Stock | |||||||||||||
Equity | |||||||||||||
Common stock issued for professional services (in shares) | 750 | ||||||||||||
Common stock purchased (in shares) | 47,851 | ||||||||||||
Stock options exercised (in shares) | 3,654 | ||||||||||||
Exercise of warrants (in shares) | 84,641 | 177,724 | |||||||||||
Issuance of stock from RSUs (shares) | 28,769 | ||||||||||||
Issuance of stock for bonuses, shares | 28,769 | ||||||||||||
Warrants to purchase common stock | |||||||||||||
Equity | |||||||||||||
Number of unexercised warrants | 32,190 |
Warrants - Activity (Details)
Warrants - Activity (Details) - shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Warrants. | ||
Balance at beginning of period (in shares) | 139,047 | 161,050 |
Obtained due to merger | 17,505 | |
Issued (in shares) | 145,192 | 138,215 |
Exercised (in shares) | (84,614) | (177,723) |
Cancelled (in shares) | (6,149) | |
Balance at end of period (in shares) | 193,476 | 139,047 |
Warrants - Activity - Additiona
Warrants - Activity - Additional Information (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | |
Jul. 31, 2021 shares | Dec. 31, 2022 $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | |
Warrants | |||
Issued (in shares) | 145,192 | 138,215 | |
Warrants exercised (in shares) | 84,614 | 177,723 | |
Reverse stock split ratio, warrants | 0.333 | ||
Warrants converted in to common stock. | 10,098 | 10,098 | |
Additional warrant expense | $ | $ 2,813 | ||
Series A warrants | |||
Warrants | |||
Warrants exercised (in shares) | 37,581 | ||
Warrants exercised (in dollars per share) | $ / shares | $ 234 | ||
Series E warrants | |||
Warrants | |||
Warrants exercised (in shares) | 37,581 | ||
Warrants exercised (in dollars per share) | $ / shares | $ 300 | ||
Series G Warrants | |||
Warrants | |||
Warrants exercised (in shares) | 83,428 | ||
Warrants issued | 11,274 | ||
Series G Warrants | Minimum | |||
Warrants | |||
Warrants exercised (in dollars per share) | $ / shares | $ 288.50 | ||
Series G Warrants | Maximum | |||
Warrants | |||
Warrants exercised (in dollars per share) | $ / shares | $ 300 | ||
Institutional Investors | |||
Warrants | |||
Warrants issued | 126,941 | ||
Series C pre-funded warrants | |||
Warrants | |||
Warrants exercised (in shares) | 1,285 | ||
Warrants exercised (in dollars per share) | $ / shares | $ 10.50 | ||
Series F prefunded warrants | |||
Warrants | |||
Warrants exercised (in shares) | 7,754 | ||
Warrants exercised (in dollars per share) | $ / shares | $ 10.50 | ||
Reload Warrants [Member] | |||
Warrants | |||
Issued (in shares) | 74,773 | ||
Warrants exercised (in shares) | 74,773 | ||
Warrants exercised (in dollars per share) | $ / shares | $ 33.33 | ||
Common Stock Purchase Warrants | |||
Warrants | |||
Issued (in shares) | 57,693 | ||
Representatives Warrants [Member] | |||
Warrants | |||
Issued (in shares) | 2,885 | ||
Pre-funded warrants | |||
Warrants | |||
Issued (in shares) | 9,841 | ||
Warrants exercised (in shares) | 9,841 | ||
Warrants exercised (in dollars per share) | $ / shares | $ 0.05 |
Warrants - Warrant assumptions
Warrants - Warrant assumptions (Details) | Dec. 31, 2022 $ / shares shares | Dec. 31, 2021 $ / shares shares | Jul. 15, 2021 | Dec. 31, 2020 shares |
Class of Warrant or Right [Line Items] | ||||
Warrants (in shares) | 193,476 | 139,047 | 161,050 | |
Reload warrants - June 2022 | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants (in shares) | 74,773 | |||
Reload warrants - November 2022 | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants (in shares) | 57,693 | |||
Representatives Warrants [Member] | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants (in shares) | 2,885 | |||
Pre-funded warrants | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants (in shares) | 9,841 | |||
January 19, 2021 placement agent warrants | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants (in shares) | 11,274 | |||
June 28, 2021 placement agent warrants | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants (in shares) | 118,941 | |||
July 16, 2021 placement agent warrants | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants (in shares) | 8,000 | |||
Strike Price | Reload warrants - June 2022 | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrant fair value measurement inputs | $ / shares | 33.33 | |||
Strike Price | Reload warrants - November 2022 | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrant fair value measurement inputs | $ / shares | 15 | |||
Strike Price | Representatives Warrants [Member] | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrant fair value measurement inputs | $ / shares | 15 | |||
Strike Price | Pre-funded warrants | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrant fair value measurement inputs | $ / shares | 0.05 | |||
Strike Price | January 19, 2021 placement agent warrants | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrant fair value measurement inputs | $ / shares | 310.50 | |||
Strike Price | June 28, 2021 placement agent warrants | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrant fair value measurement inputs | $ / shares | 300 | |||
Strike Price | July 16, 2021 placement agent warrants | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrant fair value measurement inputs | $ / shares | 202 | |||
Volatility | ||||
Class of Warrant or Right [Line Items] | ||||
Warrant fair value measurement inputs | 1.221 | |||
Volatility | Reload warrants - June 2022 | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrant fair value measurement inputs | 0.648 | |||
Volatility | Reload warrants - November 2022 | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrant fair value measurement inputs | 0.843 | |||
Volatility | Representatives Warrants [Member] | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrant fair value measurement inputs | 0.843 | |||
Volatility | Pre-funded warrants | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrant fair value measurement inputs | 0.843 | |||
Volatility | January 19, 2021 placement agent warrants | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrant fair value measurement inputs | 0.971 | |||
Volatility | June 28, 2021 placement agent warrants | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrant fair value measurement inputs | 0.976 | |||
Volatility | July 16, 2021 placement agent warrants | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrant fair value measurement inputs | 1.577 | |||
Remaining Life | Reload warrants - June 2022 | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants term | 7 years 6 months | |||
Remaining Life | Reload warrants - November 2022 | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants term | 5 years 6 months | |||
Remaining Life | Representatives Warrants [Member] | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants term | 5 years | |||
Remaining Life | Pre-funded warrants | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants term | 5 years 6 months | |||
Remaining Life | January 19, 2021 placement agent warrants | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants term | 5 years | |||
Remaining Life | June 28, 2021 placement agent warrants | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants term | 5 years | |||
Remaining Life | July 16, 2021 placement agent warrants | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants term | 5 years | |||
Risk Free Rate | ||||
Class of Warrant or Right [Line Items] | ||||
Warrant fair value measurement inputs | 0.0044 | |||
Risk Free Rate | Reload warrants - June 2022 | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrant fair value measurement inputs | 0.0332 | |||
Risk Free Rate | Reload warrants - November 2022 | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrant fair value measurement inputs | 0.0421 | |||
Risk Free Rate | Representatives Warrants [Member] | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrant fair value measurement inputs | 0.0423 | |||
Risk Free Rate | Pre-funded warrants | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrant fair value measurement inputs | 0.0421 | |||
Risk Free Rate | January 19, 2021 placement agent warrants | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrant fair value measurement inputs | 0.0045 | |||
Risk Free Rate | June 28, 2021 placement agent warrants | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrant fair value measurement inputs | 0.009 | |||
Risk Free Rate | July 16, 2021 placement agent warrants | Black Scholes Model | ||||
Class of Warrant or Right [Line Items] | ||||
Warrant fair value measurement inputs | 0.0079 |
Revenue Disaggregation and Op_3
Revenue Disaggregation and Operating Segments (Details) $ in Thousands | 7 Months Ended | 12 Months Ended | |
Dec. 31, 2021 USD ($) | Dec. 31, 2022 USD ($) segment item | Dec. 31, 2021 USD ($) | |
Revenue Recognition | |||
Revenue | $ 11,240 | $ 13,600 | |
Number of products in development stage | item | 2 | ||
Number of Operating Segments | segment | 1 | ||
United States | |||
Revenue Recognition | |||
Revenue | $ 9,230 | 10,297 | |
Australia | |||
Revenue Recognition | |||
Revenue | 688 | 1,039 | |
Europe | |||
Revenue Recognition | |||
Revenue | 1,252 | 2,127 | |
Rest of world | |||
Revenue Recognition | |||
Revenue | 70 | 137 | |
Obalon Therapeutics Inc. | |||
Revenue Recognition | |||
Revenue | $ 0 | 0 | 0 |
DBSN Device | |||
Revenue Recognition | |||
Revenue | $ 0 | $ 0 |
Stock-based Compensation (as _2
Stock-based Compensation (as Restated) - Plan Description (Details) - shares | 12 Months Ended | ||
Dec. 14, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Stock options | |||
Stock-based compensation | |||
Option expiration period | 10 years | ||
Award vesting period | 4 years | ||
2003 Stock Incentive Plan, as amended and restated | |||
Stock-based compensation | |||
Shares authorized | 82,142 | ||
Shares available for grant | 30,215 | ||
2003 Stock Incentive Plan, as amended and restated | Minimum | |||
Stock-based compensation | |||
Purchase price of common stock (as a percent) | 100% | ||
2003 Stock Incentive Plan, as amended and restated | Principal (10 percent) owner | Minimum | |||
Stock-based compensation | |||
Purchase price of common stock (as a percent) | 110% | ||
2003 Stock Incentive Plan, as amended and restated | Stock options | |||
Stock-based compensation | |||
Award vesting period | 4 years | ||
2003 Stock Incentive Plan, as amended and restated | Stock options | Maximum | |||
Stock-based compensation | |||
Option expiration period | 10 years | ||
2022 Equity Incentive Plan | |||
Stock-based compensation | |||
Number of shares authorized for plan as a percentage of stock outstanding | 15% | ||
Shares available for grant | 105,000 |
Stock-based Compensation (as _3
Stock-based Compensation (as Restated) - Stock Option Activity (Details) - USD ($) | 12 Months Ended | ||||
Sep. 15, 2021 | Jul. 13, 2021 | Jun. 18, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Shares | |||||
Shares, Options exercised (in shares) | (1,454) | (364) | (1,838) | 0 | |
Stock options | |||||
Additional disclosures | |||||
Unrecognized share-based expenses | $ 700,000 | ||||
Weighted average period | 2 years 6 months | ||||
Vesting Period | 4 years | ||||
Option expiration period | 10 years | ||||
2003 Stock Incentive Plan, as amended and restated | |||||
Shares | |||||
Shares outstanding, Beginning balance (in shares) | 17,702 | 1 | |||
Shares, Options granted (in shares) | 11,201 | 15,814 | |||
Shares, Options exercised (in shares) | (3,654) | ||||
Shares, Options cancelled (in shares) | (7,487) | (1,788) | |||
Shares outstanding, Ending balance (in shares) | 21,416 | 17,702 | |||
Shares, Exercisable (in shares) | 14,659 | ||||
Shares, Vested and expected to vest (in shares) | 21,416 | ||||
Shares, Vested options obtained due to merger (in shares) | 7,329 | ||||
Weighted Average Exercise Price | |||||
Weighted Average Exercise Price Outstanding, Beginning balance (in dollars per share) | $ 398.57 | $ 106,534,131 | |||
Weighted Average Exercise Price, Options granted (in dollars per share) | 59 | 181 | |||
Weighted Average Exercise Price, Options exercised (in dollars per share) | 114 | ||||
Weighted Average Exercise Price, Options cancelled (in dollars per share) | 139.16 | 51,261.50 | |||
Weighted Average Exercise Price Outstanding, Ending balance (in dollars per share) | 311.65 | 398.57 | |||
Weighted Average Exercise Price, Exercisable (in dollars per share) | 412.85 | ||||
Weighted Average Exercise Price, Vested and expected to vest (in dollars per share) | $ 311.65 | ||||
Weighted Average Exercise Price, Vested options obtained due to merger (in dollars per share) | $ 1,794 | ||||
Weighted Average Remaining Contractual Life | |||||
Weighted Average Remaining Contractual Life Outstanding | 7 years 2 months 12 days | ||||
Weighted Average Remaining Contractual Life, Exercisable | 6 years 8 months 12 days | ||||
Weighted Average Remaining Contractual Life, Vested and expected to vest | 7 years 2 months 12 days | ||||
Aggregate Intrinsic Value | |||||
Aggregate Intrinsic Value Outstanding (in dollars) | $ 0 | ||||
Aggregate Intrinsic Value, Exercisable (in dollars) | 0 | ||||
Vested and expected to vest (in dollars) | $ 0 | ||||
2003 Stock Incentive Plan, as amended and restated | Stock options | |||||
Additional disclosures | |||||
Vesting Period | 4 years |
Stock-based Compensation (as _4
Stock-based Compensation (as Restated) - Fair Value of Stock Options (Details) - Stock options | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Stock-based compensation | ||
Risk-free interest rate (as a percent) | 2.67% | 1.19% |
Expected term (in years) | 6 years 3 months | 6 years 3 months |
Expected dividend yield (as a percent) | 0% | 0% |
Expected volatility (as a percent) | 80.40% | 82.68% |
Stock-based Compensation (as _5
Stock-based Compensation (as Restated) - Restricted Stock Units (Details) - Restricted stock units - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Shares | ||
Unvested RSUs, Beginning balance (in shares) | 34,226 | |
Shares, Granted (in shares) | 32,777 | 72,212 |
Shares, Vested (in shares) | (50,131) | (37,986) |
Shares, Cancelled/Forfeited (in shares) | (12,342) | |
Non-vested RSUs, Ending balance (in shares) | 4,530 | 34,226 |
Weighted Average Grant Date Fair Value | ||
Unvested RSUs, Beginning balance (in dollars per share) | $ 218 | |
Weighted Average Grant Date Fair Value, Granted (in dollars per share) | 16.92 | $ 218 |
Weighted Average Grant Date Fair Value, Vested (in dollars per share) | 97.44 | 218 |
Weighted Average Grant Date Fair Value, Cancelled/Forfeited (in dollars per share) | 189.88 | |
Non-vested RSUs, Ending balance (in dollars per share) | $ 174.01 | $ 218 |
Additional disclosures | ||
Vested and undistributed | 278 | |
Unrecognized compensation costs | $ 0.7 | |
Recognition period | 1 year 7 months 6 days |
Stock-based Compensation (as _6
Stock-based Compensation (as Restated) - Expense for Stock-Based Awards (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Compensation expense recognized | ||
Stock-based compensation expense | $ 2,087 | $ 12,227 |
Sales and marketing | ||
Compensation expense recognized | ||
Stock-based compensation expense | 280 | 949 |
General and administrative expense | ||
Compensation expense recognized | ||
Stock-based compensation expense | 1,494 | 10,126 |
Research and development | ||
Compensation expense recognized | ||
Stock-based compensation expense | $ 313 | $ 1,152 |
Income Taxes (as Restated) - In
Income Taxes (as Restated) - Income Tax Benefit (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2022 | Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Deferred: | |||||||
Federal | $ (293) | $ (218) | |||||
State | (76) | (30) | |||||
Foreign | (54) | ||||||
Deferred income tax benefit | $ (368) | (423) | (248) | ||||
Current: | |||||||
Federal | 30 | ||||||
State | 9 | 11 | |||||
Foreign | 4 | (37) | |||||
Total income tax benefit, net | $ (363) | $ 9 | $ 30 | $ 39 | $ (324) | $ (380) | $ (274) |
Income Taxes (as Restated) - Ta
Income Taxes (as Restated) - Tax Rate Reconciliation (Details) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Taxes (as Restated) | ||
Income tax benefit at U.S. federal statutory rate | 21% | 21% |
State income tax benefit, net of federal benefit | 3.80% | 3.30% |
Stock warrant valuation | (2.00%) | |
Goodwill impairment | (7.80%) | |
Stock-based compensation | (12.00%) | |
Other permanent differences | (1.90%) | (3.80%) |
Change in state tax rate | 0.30% | (1.00%) |
Foreign rate differential | (0.20%) | |
Net operating loss true up | 0.30% | |
Other adjustments | 2.80% | 0.30% |
Change in valuation allowance | (25.00%) | 2.10% |
Effective income tax rate | 0.80% | 0.40% |
Income Taxes (as Restated) -Unc
Income Taxes (as Restated) -Uncertain tax positions (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Reconciliation of amount of uncertain tax positions | ||
Uncertain gross tax positions, January 1 | $ 1,052 | |
Increase in prior year tax positions | $ 1,052 | |
Settlements | 0 | |
Uncertain gross tax positions, December 31 | $ 1,052 | $ 1,052 |
Income Taxes (as Restated) - Co
Income Taxes (as Restated) - Components of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred tax assets (liabilities): | ||
Start-up costs | $ 1,137 | $ 1,225 |
Capitalized research and development costs | 272 | 408 |
Reserves and accruals | 1,157 | 1,679 |
Intangible assets | 4,597 | |
Research and development credit | 2,492 | 2,492 |
Lease liability | 43 | 74 |
Net operating loss carryforwards | 63,424 | 55,725 |
State and local taxes | 2 | 2 |
Total gross deferred tax assets | 73,124 | 61,605 |
Valuation allowance | (72,945) | (61,231) |
Deferred tax assets, net of valuation allowance | 179 | 374 |
Property and equipment | (80) | (23) |
Intangible assets | (648) | |
Operating lease right-of-use assets | (43) | (70) |
Total gross deferred tax liabilities | (123) | (741) |
Net deferred tax liability | $ (367) | |
Deferred income taxes, net | $ 56 |
Income Taxes (as Restated) - Ca
Income Taxes (as Restated) - Carryforwards and Limitations (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income taxes | ||
Net operating losses subject to expiration | $ 82.5 | |
Research and development credits, operating loss carryforwards | 3.4 | |
Unrecognized tax benefits, if recognized, would affect its effective income tax rate | $ 0 | 0 |
Unrecognized tax benefits, income tax penalties and interest accrued | $ 0 | |
Minimum | ||
Income taxes | ||
Percentage of change in ownership | 50% | |
State | ||
Income taxes | ||
Net operating loss carryforwards amount | $ 329.1 | 280.7 |
Net operating losses subject to expiration | 91 | |
Foreign | ||
Income taxes | ||
Net operating loss carryforwards amount | 0.2 | 0.2 |
U.S. federal | ||
Income taxes | ||
Net operating loss carryforwards amount | 207.9 | $ 182 |
Net operating loss carryforwards subject to expiration and IRC Section 382 limitation | $ 6.3 | |
Carryover period | 20 years |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ in Thousands | Dec. 06, 2022 | Jul. 19, 2022 | Aug. 18, 2021 | Aug. 06, 2021 | Dec. 31, 2022 | Dec. 31, 2021 |
Employee Arrangements and Other Compensation | ||||||
Severance benefits payable | $ 800 | |||||
Purchase Commitments | ||||||
Purchase commitments | 2,900 | |||||
Accrued liabilities | ||||||
Employee Arrangements and Other Compensation | ||||||
Accrued performance bonuses | 300 | $ 900 | ||||
Cowen and Company | ||||||
Litigation | ||||||
Agreed settlement amount | $ 1,350 | |||||
Service fees sought | $ 1,350 | |||||
Litigation settlement, interest percent | 9% | |||||
Litigation settlement, accrued interest | 1,350 | |||||
Litigation liability | $ 200 | |||||
H. C. Wainwright and Company | ||||||
Contingencies | ||||||
Percentage of gross proceeds received from the exercise of warrants issued pursuant to capital raising engagement agreements sought | 8% | |||||
Litigation | ||||||
Agreed settlement amount | $ 1,000 |
Subsequent Events (Details)
Subsequent Events (Details) $ / shares in Units, $ in Millions | Feb. 08, 2023 USD ($) $ / shares shares | Jun. 21, 2021 shares | Jun. 18, 2021 shares | Apr. 11, 2023 USD ($) | Mar. 29, 2023 USD ($) | Mar. 13, 2023 ft² | Mar. 10, 2023 USD ($) | Dec. 31, 2021 shares | Jul. 15, 2021 $ / shares |
Subsequent Events | |||||||||
Common stock purchased (in shares) | 3,754 | 4,000 | |||||||
Subsequent Event | |||||||||
Subsequent Events | |||||||||
Warrants, cashless exercise provision, shares, multiplier | 0.50 | ||||||||
Subsequent Event | Public offering | |||||||||
Subsequent Events | |||||||||
Number of units issued | 1,275,000 | ||||||||
Number of shares for each unit | 1 | ||||||||
Share price (in dollars per share) | $ / shares | $ 8 | ||||||||
Warrant exercise price (in dollars per share) | $ / shares | $ 8 | ||||||||
Warrants term | 5 years | ||||||||
Gross proceeds from issuance of shares | $ | $ 10.2 | ||||||||
Subsequent Event | Over-allotment option | |||||||||
Subsequent Events | |||||||||
Common stock purchased (in shares) | 191,250 | ||||||||
Warrants to purchase shares of common stock | 286,875 | ||||||||
Issuance of common stock upon exercise of warrants, net of transaction costs (in shares) | 286,875 | ||||||||
SVB | Subsequent Event | |||||||||
Subsequent Events | |||||||||
Insured and uninsured deposits | $ | $ 1.4 | $ 9.7 | |||||||
Bank of America | Subsequent Event | |||||||||
Subsequent Events | |||||||||
Insured and uninsured deposits | $ | $ 7 | ||||||||
Series G Warrants | |||||||||
Subsequent Events | |||||||||
Warrants to purchase shares of common stock | 11,274 | ||||||||
Pre-funded warrants | Subsequent Event | Public offering | |||||||||
Subsequent Events | |||||||||
Number of warrants for each unit | 1 | ||||||||
Class of warrant or right, number of securities called by each warrant | 1 | ||||||||
Public warrants | Subsequent Event | Public offering | |||||||||
Subsequent Events | |||||||||
Number of warrants for each unit | 1 | ||||||||
Class of warrant or right, number of securities called by each warrant | 0.5 | ||||||||
Irvine, California, Office and Warehouse Space | Subsequent Event | |||||||||
Subsequent Events | |||||||||
Area of land | ft² | 5,038 | ||||||||
Lease renewal term | 36 months | ||||||||
Minimum | |||||||||
Subsequent Events | |||||||||
Warrant exercise price (in dollars per share) | $ / shares | $ 13.20 | ||||||||
Maximum | |||||||||
Subsequent Events | |||||||||
Warrant exercise price (in dollars per share) | $ / shares | $ 15 |