UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

☒Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period ended March 31, 2022

☐Transmission Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from ______ to ______

Commission file number: 001-32046

Tivic Health Systems, Inc.

(Exact name of registrant as specified in its charter)


Delaware (State or other jurisdiction of incorporation or organization)	81-4016391 (I.R.S. Employer Identification No.)

25821 Industrial Blvd., Suite 100 Hayward, CA 94545 (Address of principal executive offices including zip code)	(888) 276-6888 (Registrant’s telephone number, including area code)

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

Title of Each Class

Common Stock, par value $0.0001 per share

Trading Symbol(s)

TIVC

Name of Each Exchange on Which Registered

The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act (Check one):


☐ Large accelerated Filer	☐ Accelerated Filer
☒ Non-accelerated Filer	☒ Smaller reporting company
☒ Emerging Growth Company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of May 10, 2022, 9,621,484 shares of the registrant’s common stock, par value $0.0001 per share, were outstanding.

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Table of Contents


PART I - FINANCIAL INFORMATION

		Page
Item 1.	Financial Statements	1

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	17

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	26

Item 4.	Controls and Procedures	26

PART II - OTHER INFORMATION

Item 1.	Legal Proceedings	28

Item 1A.	Risk Factors	28

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	28

Item 3.	Defaults upon Senior Securities	28

Item 4.	Mine Safety Disclosures	29

Item 5.	Other Information	29

Item 6.	Exhibits	29

	Signatures	30

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PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

Our condensed financial statements included in this Quarterly Report on Form 10-Q are as follows:

Condensed Balance Sheets as of March 31, 2022 (unaudited) and December 31, 2021	2
Condensed Statements of Operations for the three months ended March 31, 2022 and 2021 (unaudited)	3
Condensed Statements of Stockholders’ Equity for the three months ended March 31, 2022 and 2021 (unaudited)	4
Condensed Statements of Cash Flow for the three months ended March 31, 2022 and 2021 (unaudited)	5
Notes to Condensed Financial Statements (unaudited)	6

This Quarterly Report on Form 10-Q for the quarter ended March 31, 2022, should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, filed with the Securities and Exchange Commission (“SEC”) on March 31, 2022.

The accompanying condensed financial statements and footnotes have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and the SEC instructions to Form 10-Q. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. Operating results for the interim period ended March 31, 2022 are not necessarily indicative of the results that can be expected for the full year.

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Tivic Health Systems, Inc.

Condensed Balance Sheets (Unaudited)

March 31, 2022 and December 31, 2021

(in thousands, except share and per share data)


	March 31,		December 31,
	2022		2021
ASSETS
Current assets
Cash and cash equivalents	$	10,801	$	12,975
Accounts receivable, net		117		92
Inventory, net		447		429
Prepaid expenses and other current assets		633		793
Total current assets		11,998		14,289
Property and equipment, net		16		11
Right-of-use assets, operating lease		647		687
Other assets		33		49
Total assets	$	12,694	$	15,036

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable	$	625	$	789
Other accrued expenses		304		267
Operating lease liability, current		168		163
Total current liabilities		1,097		1,219
Operating lease liability		504		545
Total liabilities		1,601		1,764
Commitments and contingencies
Stockholders’ equity
Preferred stock, $0.0001 par value, 10,000,000 shares authorized; no shares issued and outstanding at March 31, 2022 and December 31, 2021		—		—
Common stock, $0.0001 par value, 200,000,000 shares authorized; 9,715,234 shares issued and outstanding at March 31, 2022 and December 31, 2020, respectively		1		1
Additional paid in capital		32,878		32,817
Accumulated deficit		(21,786)		(19,546)
Total stockholders’ equity		11,093		13,272
Total liabilities and stockholders’ equity	$	12,694	$	15,036

The accompanying notes are an integral part of these condensed financial statements.

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Tivic Health Systems, Inc.

Condensed Statements of Operations (Unaudited)

Three Months Ended March 31, 2022 and 2021

(in thousands, except share and per share data)


	Three Months Ended
	March 31,
	2022		2021
Revenue	$	428	$	323
Cost of sales		358		301
Gross profit		70		22
Operating expenses:
Research and development		401		198
Sales and marketing		684		300
General and administrative		1,226		581
Total operating expenses		2,311		1,079
Loss from operations		(2,241)		(1,057)
Other income (expense):
Interest expense		—		(274)
Change in fair value of derivative liabilities		—		(27)
Other income		1		2
Total other income (expense)		1		(299)
Loss before provision for income taxes		(2,240)		(1,356)
Net loss and comprehensive loss	$	(2,240)	$	(1,356)
Net loss per share - basic and diluted	$	(0.23)	$	(0.58)
Weighted-average number of shares - basic and diluted		9,715,234		2,334,479

The accompanying notes are an integral part of these condensed financial statements.

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Tivic Health Systems, Inc.

Statements of Stockholders’ Equity (Deficit) (Unaudited)

Three Months Ended March 31, 2022 and 2021

(in thousands except share and per share data)

For the Three Months Ended March 31, 2021


	Convertible						Additional				Total
	Preferred Stock			Common Stock			Paid-in		Accumulated		Stockholders’
	Shares	Amount		Shares	Amount		Capital		Deficit		Deficit
Balances at January 1, 2021	8,908,600	$	1	2,324,479	$	—	$	9,874	$	(11,052)	$	(1,177)
Exercise of stock options	—		—	6,250		—		6		—		6
Stock-based compensation expense	—		—	—		—		10		—		10
Net loss	—		—	—		—		—		(1,356)		(1,356)
Balances at March 31, 2021	8,908,600	$	1	2,306,250	$	—	$	9,890	$	(12,408)	$	(2,517)

For the Three Months Ended March 31, 2022


							Additional				Total
	Preferred Stock			Common Stock			Paid-in		Accumulated		Stockholders'
	Shares	Amount		Shares	Amount		Capital		Deficit		Equity
Balances at January 1, 2022	—	$	—	9,715,234	$	1	$	32,817	$	(19,546)	$	13,272
Stock-based compensation expense	—		—	—		—		61		—		61
Net loss	—		—	—		—		—		(2,240)		(2,240)
Balances at March 31, 2022	—	$	—	9,715,234	$	1	$	32,878	$	(21,786)	$	11,093

The accompanying notes are an integral part of these condensed financial statements.

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Tivic Health Systems, Inc.

Condensed Statements of Cash Flows (Unaudited)

Three Months Ended March 31, 2022 and 2021

(in thousands)


	Three Months Ended
	March 31,
	2022		2021
Cash flows from operating activities
Net loss	$	(2,240)	$	(1,356)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock based compensation		61		10
Depreciation		2		2
Change in fair value of derivative liabilities		—		27
Amortization of debt discount		—		261
Amortization of right-of-use asset		40		—
Accounts receivable allowances		5		22
Reserve for inventory obsolescence		—		(8)
Changes is operating assets and liabilities:
Accounts receivable		(30)		(33)
Inventory		(18)		7
Prepaid expenses and other current assets		175		(62)
Accounts payable

SEC Form 10-Q filed by Tivic Health Systems Inc.