VIVEVE MEDICAL, INC. (Form: 10-Q, Received: 11/10/2016 16:08:07)

ITEM 1. Financial Statements (unaudited)

VIVEVE MEDICAL, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)

	September 30,			December 31,
	2016			2015
	(unaudited)				(1)
ASSETS
Current assets:
Cash and cash equivalents	$	14,011		$	7,360
Accounts receivable		1,807			593
Inventory		1,413			1,549
Prepaid expenses and other current assets		1,298			1,228
Total current assets		18,529			10,730
Property and equipment, net		445			239
Other assets		133			138
Total assets	$	19,107		$	11,107
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	2,477		$	1,432
Accrued liabilities		1,978			1,293
Note payable, current portion		865			4,446
Total current liabilities		5,320			7,171
Note payable, noncurrent portion		8,730			-
Total liabilities		14,050			7,171
Commitments and contingences (Note 6)
Stockholders’ equity:
Preferred stock, $0.0001 par value; 10,000,000 shares authorized as of September 30, 2016; no shares issued		-			-
Preferred stock, no par value; unlimited shares authorized as of December 31, 2015; no shares issued		-			-
Common stock, $0.0001 par value; 75,000,000 shares authorized as of September 30, 2016; 10,648,407 shares issued and outstanding as of September 30, 2016		1			-
Additional paid-in capital		67,858			-
Common stock and paid-in capital, no par value; unlimited shares authorized as of December 31, 2015; 7,490,288 shares issued and outstanding as of December 31, 2015		-			52,447
Accumulated deficit		(62,802	)		(48,511	)
Total stockholders’ equity		5,057			3,936
Total liabilities and stockholders’ equity	$	19,107		$	11,107

(1) The condensed consolidated balance sheet as of December 31, 2015 has been derived from the audited consolidated financial statements as of that date.

Note: All share and per share data has been adjusted to reflect the 1-for-8 reverse stock split which became effective April 15, 2016, as discussed in Note 2.

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

VIVEVE MEDICAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share data)

(unaudited)

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2016			2015			2016			2015

Revenue	$	1,849		$	584		$	4,689		$	695
Cost of revenue		1,158			417			3,116			520
Gross profit		691			167			1,573			175

Operating expenses:
Research and development		2,054			1,515			6,313			3,446
Selling, general and administrative		3,272			1,757			8,435			5,155
Total operating expenses		5,326			3,272			14,748			8,601
Loss from operations		(4,635	)		(3,105	)		(13,175	)		(8,426	)
Interest expense, net		(221	)		(114	)		(1,094	)		(302	)
Other expense, net		(13	)		-			(22	)		(21	)
Comprehensive and net loss	$	(4,869	)	$	(3,219	)	$	(14,291	)	$	(8,749	)


Net loss per share:
Basic and diluted	$	(0.46	)	$	(0.50	)	$	(1.63	)	$	(1.99	)

Weighted average shares used in computing net loss per common share
Basic and diluted		10,630,468			6,418,457			8,741,667			4,403,620

Note: All share and per share data has been adjusted to reflect the 1-for-8 reverse stock split which became effective April 15, 2016, as discussed in Note 2.

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

VIVEVE MEDICAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)

	Nine Months Ended
	September 30,
	2016			2015

Cash flows from operating activities:
Net loss	$	(14,291	)	$	(8,749	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		78			57
Stock-based compensation		662			145
Fair value of warrants issued		162			152
Fair value of warrants issued to employees for bonuses		-			244
Non-cash interest expense		422			151
Changes in assets and liabilities:
Accounts receivable		(1,214	)		(233	)
Inventory		76			(534	)
Prepaid expenses and other current assets		(70	)		(861	)
Other noncurrent assets		5			10
Accounts payable		1,045			685
Accrued liabilities		931			604
Net cash used in operating activities		(12,194	)		(8,329	)

Cash flows from investing activities:
Purchase of property and equipment		(224	)		(48	)
Net cash used in investing activities		(224	)		(48	)

Cash flows from financing activities:
Proceeds from sale of common stock, net of issuance costs		13,886			11,040
Proceeds from note payable		9,910			2,500
Repayments of note payable		(4,833	)		-
Proceeds from exercise of warrants		92			3
Proceeds from exercise of stock options		14			-
Net cash provided by financing activities		19,069			13,543
Net increase in cash and cash equivalents		6,651			5,166

Cash and cash equivalents - beginning of period		7,360			895
Cash and cash equivalents - end of period	$	14,011		$	6,061

Supplemental disclosure:
Cash paid for interest	$	636		$	151
Cash paid for income taxes	$	1		$	1


Supplemental disclosure of cash flow information as of end of period:
Issuance of warrant in connection with note payable	$	350		$	10
Restricted stock awards granted to employees for 2015 accrued bonuses	$	246		$	-
Net transfer of equipment between inventory and property and equipment	$	60		$	20

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

VIVEVE MEDICAL, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. The Company and Basis of Presentation

Viveve Medical, Inc. (“Viveve Medical”, the “Company”, “we”, “our”, or “us”) competes in the women’s health industry by marketing Geneveve™ as a way to improve the overall sexual well-being and quality of life of women suffering from vaginal laxity.

Public Offering

On June 17, 2016, in connection with the closing of a public offering (the “June 2016 Offering”), we issued an aggregate of 3,105,000 shares of common stock, including the shares issued in connection with the exercise of the underwriters’ overallotment option, at a public offering price of $5.00 per share for gross proceeds of approximately $15,525,000. The net proceeds to the Company, after the deduction of underwriting discounts, commissions and other offering expenses, were approximately $13,886,000.

Change of Corporate Domicile

On May 9, 2016, the Company filed the necessary Application for Authorization to Continue into Another Jurisdiction and Statutory Declaration with the Yukon registrar. On May 10, 2016, the Company filed a Certificate of Incorporation with the Secretary of State of the State of Delaware to move its domicile from the Yukon Territory to Delaware. In connection with the incorporation in Delaware, the Company's stock now has a par value of $0.0001 per share.

Interim Unaudited Financial Information

The accompanying unaudited condensed consolidated financial statements of Viveve Medical have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) for interim financial information and pursuant to the instructions to Form 10-Q and Article 8-03 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by US GAAP for complete financial statements. In the opinion of management, all adjustments, consisting of normal recurring adjustments, considered necessary for a fair presentation of the condensed consolidated financial statements have been included.

The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Annual Report on Form 10-K for the year ended December 31, 2015, which was filed with the Securities and Exchange Commission on March 24, 2016. The results of operations for the three and nine months ended September 30, 2016 are not necessarily indicative of the results for the year ending December 31, 2016 or any future interim period.

2. Summary of Significant Accounting Policies

Financial Statement Presentation

The condensed consolidated financial statements include the accounts of the Company and our wholly-owned subsidiaries, Viveve, Inc. and Viveve BV. All significant intercompany accounts and transactions have been eliminated in consolidation.

Reclassification of Prior Year Presentation

Certain prior year amounts have been reclassified for consistency with the current period presentation. These reclassifications had no effect on the reported results of operations. Accounting Standards Update (“ASU”) 2015-03 requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. ASU 2015-03 is effective for the Company’s fiscal year beginning January 1, 2016. We adopted this guidance in the first quarter of 2016. Accordingly, the Company has revised the classification in the condensed consolidated balance sheet to report debt issuance costs as a contra debt liability as of December 31, 2015. This resulted in a decrease of $387,000 to the December 31, 2015 amounts reported as prepaid expenses and other current assets, total assets, note payable, total liabilities, and total liabilities and stockholders’ equity.

Reverse Stock Split

On April 15, 2016, the Company effected a 1-for-8 reverse stock split of its common stock. On the effective date of the reverse stock split, (i) each 8 shares of outstanding common stock were reduced to one share of common stock; (ii) the number of shares of common stock into which each outstanding warrant or option to purchase common stock is exercisable were proportionately reduced on an 8-to-1 basis; and (iii) the exercise price of each outstanding warrant or option to purchase common stock were proportionately increased on a 1-to-8 basis. All of the share numbers, share prices, and exercise prices have been adjusted, on a retroactive basis, to reflect this 1-for-8 reverse stock split.

Use of Estimates

The preparation of condensed consolidated financial statements in conformity with US GAAP requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, and expenses and the related disclosure of contingent assets and liabilities. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates. In addition, any change in these estimates or their related assumptions could have an adverse effect on our operating results.

Concentration of Credit Risk and Other Risks and Uncertainties

To achieve profitable operations, the Company must successfully develop, manufacture, and market its products. There can be no assurance that any such products can be developed or manufactured at an acceptable cost and with appropriate performance characteristics, or that such products will be successfully marketed. These factors could have a material adverse effect upon the Company’s financial results, financial position, and future cash flows.

The Company’s products may require approval from the U.S. Food and Drug Administration or other international regulatory agencies prior to commencing commercial sales. There can be no assurance that the Company’s products will receive any of these required approvals. If the Company was denied such approvals or such approvals were delayed, it would have a material adverse effect on the Company’s financial results, financial position and future cash flows.

The Company is subject to risks common to companies in the medical device industry including, but not limited to, new technological innovations, dependence on key personnel, protection of proprietary technology, compliance with government regulations, uncertainty of market acceptance of products, product liability, and the need to obtain additional financing. The Company’s ultimate success is dependent upon its ability to raise additional capital and to successfully develop and market its products.

The Company designs, develops, manufactures and markets a medical device for the non-invasive treatment of vaginal laxity that it refers to as the Geneveve™, which includes the Viveve System™, single-use treatment tips and other ancillary consumables. The Company outsources the manufacture and repair of the Viveve System to a single contract manufacturer. Also, certain other components and materials that comprise the Geneveve are currently manufactured by a single supplier or a limited number of suppliers. A significant supply interruption or disruption in the operations of the contract manufacturer or these third-party suppliers would adversely impact the production of our products for a substantial period of time, which could have a material adverse effect on our business, financial condition, operating results and cash flows.

During the three months ended September 30, 2016, two customers accounted for 89% of the Company’s revenue. During the three months ended September 30, 2015, three customers accounted for 93% of the Company’s revenue. During the nine months ended September 30, 2016, three customers accounted for 83% of the Company’s revenue. During the nine months ended September 30, 2015, three customers accounted for 83% of the Company’s revenue.

Revenue Recognition

The Company recognizes revenue from the sale of its products, the Viveve System, single-use treatment tips and ancillary consumables. Revenue is recognized upon shipment, provided that persuasive evidence of an arrangement exists, the price is fixed or determinable and collection of the resulting receivable is reasonably assured. Sales of our products are subject to regulatory requirements that vary from country to country. The Company has regulatory clearance, or can sell its products without a clearance, in many countries throughout the world, including countries within the following regions: North America, Latin America, Europe, the Middle East and Asia Pacific.

The Company does not provide its customers with a contractual right of return.

Customer Advance Payments

From time to time, customers will pay for a portion of the products ordered in advance. Upon receipt of such payments, the Company records the customer advance payment as a component of accrued liabilities. The Company will remove the customer advance payment from accrued liabilities and revenue is recognized upon shipment of the product assuming all other revenue recognition criteria are met.

Product Warranty

The Company’s products are generally subject to a one-year warranty, which provides for the repair, rework or replacement of products (at the Company’s option) that fail to perform within stated specification. The Company has assessed the historical claims and, to date, product warranty claims have not been significant. The Company will continue to assess the need to record a warranty accrual at the time of sale going forward.

Comprehensive Loss

Comprehensive loss represents the changes in equity of an enterprise, other than those resulting from stockholder transactions. Accordingly, comprehensive loss may include certain changes in equity that are excluded from net loss. For the three and nine months ended September 30, 2016 and 2015, the Company’s comprehensive loss is the same as its net loss.

Net Loss per Share

The Company’s basic net loss per share is calculated by dividing the net loss by the weighted average number of shares of common stock outstanding for the period. The diluted net loss per share is computed by giving effect to all potentially dilutive common stock equivalents outstanding during the period. For purposes of this calculation, stock options and warrants to purchase common stock and restricted common stock awards are considered common stock equivalents. For periods in which the Company has reported net losses, diluted net loss per share is the same as basic net loss per share, since dilutive common shares are not assumed to have been issued if their effect is anti-dilutive.

The following securities were excluded from the calculation of net loss per share because the inclusion would be anti-dilutive.

	September 30,
	2016		2015

Stock options to purchase common stock		1,315,808		419,127
Warrants to purchase common stock		425,274		358,119
Restricted common stock awards		64,405		-

Recently Issued and Adopted Accounting Standards

In May 2014, as part of its ongoing efforts to assist in the convergence of US GAAP and International Financial Reporting Standards (“IFRS”), the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09, “Revenue from Contracts with Customers (Topic 606).” The new guidance sets forth a new five-step revenue recognition model which replaces the prior revenue recognition guidance in its entirety and is intended to eliminate numerous industry-specific pieces of revenue recognition guidance that have historically existed in US GAAP. The underlying principle of the new standard is that a business or other organization will recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects what it expects in exchange for the goods or services. The standard also requires more detailed disclosures and provides additional guidance for transactions that were not addressed completely in the prior accounting guidance. The ASU provides alternative methods of initial adoption and is effective for annual and interim periods beginning after December 15, 2017. The FASB has issued several updates to the standard which i) defer the original effective date from January 1, 2017 to January 1, 2018, while allowing for early adoption as of January 1, 2017 (ASU 2015-14); ii) clarify the application of the principal versus agent guidance (ASU 2016-08); and iii) clarify the guidance on inconsequential and perfunctory promises and licensing (ASU 2016-10). In May 2016, the FASB issued ASU 2016-12, “Revenue from Contracts with Customers (Topic 606) Narrow-Scope Improvements and Practical Expedients”, to address certain narrow aspects of the guidance including collectibility criterion, collection of sales taxes from customers, noncash consideration, contract modifications and completed contracts. This issuance does not change the core principle of the guidance in the initial topic issued in May 2014. We are currently evaluating the impact that this standard will have on our condensed consolidated financial statements.

In April 2015, the FASB issued ASU 2015-03, “Simplifying the Presentation of Debt Issuance Costs” (“ASU 2015-03”). ASU 2015-03 requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. ASU 2015-03 is effective for the Company’s fiscal year beginning January 1, 2016 and subsequent interim periods, with earlier adoption permitted. We adopted this guidance in the first quarter of 2016 and have reclassified our condensed consolidated balance sheets to comply with the new standard.

In July 2015, the FASB issued ASU 2015-11, “Simplifying the Measurement of Inventory” (“ASU 2015-11”). ASU 2015-11 requires that an entity should measure inventory within the scope of this pronouncement at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The pronouncement does not apply to inventory that is being measured using the last-in, first-out (“LIFO”) method or the retail inventory method. Subsequent measurement is unchanged for inventory measured using LIFO or the retail inventory method. ASU 2015-11 will be effective for the Company’s fiscal year beginning January 1, 2017 and subsequent interim periods, with earlier adoption permitted. We are currently evaluating the effect of the adoption of this guidance on our condensed consolidated financial statements.

In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842)”. Under this guidance, an entity is required to recognize right-of-use assets and lease liabilities on its balance sheet and disclose key information about leasing arrangements. This guidance offers specific accounting guidance for a lessee, a lessor and sale and leaseback transactions. Lessees and lessors are required to disclose qualitative and quantitative information about leasing arrangements to enable a user of the financial statements to assess the amount, timing and uncertainty of cash flows arising from leases. This guidance is effective for annual reporting periods beginning after December 15, 2018, including interim periods within the reporting period, and requires a modified retrospective adoption, with early adoption permitted. We are currently evaluating the effect of the adoption of this guidance on our condensed consolidated financial statements.

In March 2016, the FASB issued ASU 2016-09, “Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting”. This guidance identifies areas for simplification involving several aspects of accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, an option to recognize gross stock compensation expense with actual forfeitures recognized as they occur, as well as certain classifications on the statement of cash flows. This guidance is effective for annual reporting periods beginning after December 15, 2016, including interim periods within the reporting period, with early adoption permitted. We are currently evaluating the effect of the adoption of this guidance on our condensed consolidated financial statements.

In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows, Classification of Certain Cash Receipts and Cash Payments (Topic 230). This guidance addresses specific cash flow issues with the objective of reducing the diversity in practice for the treatment of these issues. The areas identified include: debt prepayment or debt extinguishment costs; settlement of zero-coupon debt instruments; contingent consideration payments made after a business combination; proceeds from the settlement of insurance claims; proceeds from the settlement of corporate-owned life insurance policies; distributions received from equity method investees; beneficial interests in securitization transactions and application of the predominance principle with respect to separately identifiable cash flows. This guidance is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period, with early adoption permitted. We are currently evaluating the effect of the adoption of this guidance on our condensed consolidated financial statements.

3. Fair Value Measurements

The Company recognizes and discloses the fair value of its assets and liabilities using a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). Each level of input has different levels of subjectivity and difficulty involved in determining fair value.

Level 1

Inputs used to measure fair value are unadjusted quoted prices that are available in active markets for the identical assets or liabilities as of the reporting date. Therefore, determining fair value for Level 1 investments generally does not require significant judgment, and the estimation is not difficult.

Level 2

Pricing is provided by third party sources of market information obtained through investment advisors. The Company does not adjust for or apply any additional assumptions or estimates to the pricing information received from its advisors.

Level 3

Inputs used to measure fair value are unobservable inputs that are supported by little or no market activity and reflect the use of significant management judgment. These values are generally determined using pricing models for which the assumptions utilize management’s estimates of market participant assumptions. The determination of fair value for Level 3 instruments involves the most management judgment and subjectivity.

Assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires management to make judgments and consider factors specific to the asset or liability.

There were no financial instruments that were measured at fair value on a recurring basis as of September 30, 2016 and December 31, 2015.

The carrying amounts of the Company’s financial assets and liabilities, including cash and cash equivalents, accounts receivable, accounts payable, and accrued expenses as of September 30, 2016 and December 31, 2015 approximate fair value because of the short maturity of these instruments. Based on borrowing rates currently available to the Company for loans with similar terms, the carrying value of the notes payable approximates fair value.

4. Accrued Liabilities

Accrued liabilities consisted of the following (in thousands):

	September 30,		December 31,
	2016		2015

Accrued professional fees	$	587	$	388
Accrued bonuses		513		613
Customer advance payments		442		20
Accrued payroll and other related expenses		251		113
Accrued clinical trial costs		4		112
Other accruals		181		47
Total accrued liabilities	$	1,978	$	1,293

5. Note Payable

On September 30, 2014, we entered into a Loan and Security Agreement, as amended on February 19, 2015, May 14, 2015, November 30, 2015 and March 18, 2016 (collectively, the “2014 Loan Agreement”), with Pacific Western Bank (as successor in interest by merger to Square 1 Bank) (the “Lender”), pursuant to which we received a term loan in the amount of $5,000,000, funded in three tranches. The first tranche of $2,500,000 was provided to us on October 1, 2014 and proceeds of $500,000 from the second tranche were received on each of February 19, 2015, March 16, 2015 and April 6, 2015 for aggregate proceeds of $1,500,000. The terms of the loan required that the Company meet certain financial covenants and milestones in connection with the Company’s randomized, blinded and sham-controlled clinical trial in Europe and Canada (the “OUS Clinical Trial”), and on July 15, 2015 we received the final $1,000,000 of the term loan with a drawdown of funds from the third tranche.

In connection with the 2014 Loan Agreement, we entered into an Intellectual Property Security Agreement, dated September 30, 2014, pursuant to which a first priority security interest was created in all of our intellectual property, and we issued a 10-year warrant to the Lender for the purchase of 58,962 shares of the Company’s common stock at an exercise price $4.24 per share, and pursuant to the first amendment to the 2014 Loan Agreement in February 2015, such number of shares to automatically increase in the event the Company fails to meet certain covenants. In connection with the second amendment to the 2014 Loan Agreement in May 2015, we issued a second 10-year warrant to the Lender to purchase a total of 3,125 shares of common stock at an exercise price of $2.96 per share. These two warrants were exercised in July and August 2016 (See Note 7).

On June 20, 2016, we entered into a Loan and Security Agreement (the “2016 Loan Agreement”) with Western Alliance Bank (the “WAB”), pursuant to which the WAB agreed to loan us up to an aggregate of $10,000,000 payable in two tranches of $7,500,000 and $2,500,000. The funding conditions for both tranches were satisfied as of the closing date, and therefore, the aggregate principal amount of $10,000,000 was provided to us on June 20, 2016. The proceeds received were used to repay the outstanding existing indebtedness under the 2014 Loan Agreement and the remaining balance will be used for working capital purposes and to fund general business requirements. The borrowings are repayable in interest only payments until July 1, 2017 and then 30 monthly equal installments of principal and interest. The term loan shall bear interest on the outstanding obligations under the loan at a floating per annum rate equal to the greater of (i) the Index Rate (i.e., the 30 day U.S. LIBOR rate reported in the Wall Street Journal) plus 6.96%, determined as of the last day of each month, and (ii) 7.40%.

In connection with the 2016 Loan Agreement, we issued a 10-year warrant to the WAB to purchase a total of 100,402 shares of the Company’s common stock at an exercise price of $4.98 per share (See Note 7).

All borrowings under the 2016 Loan Agreement are collateralized by substantially all of the Company’s assets, including intellectual property.

The Company is also required to meet certain financial and other covenants in connection with the 2016 Loan Agreement. As of September 30, 2016, the Company was in compliance with all covenants.

As of September 30, 2016, future minimum payments under the note payable are as follows (in thousands):

Year Ending December 31,
2016 (remaining 3 months)	$	187
2017		2,719
2018		4,463
2019		4,512
Total payments		11,881
Less: Amount representing interest		(1,881	)
Present value of obligations		10,000
Less: Unamortized debt discount		(405	)
		9,595
Less: Note payable, noncurrent portion		8,730
Note payable, current portion	$	865

6. Commitments and Contingencies

Operating Lease

In January 2012, the Company entered into a lease agreement for office and laboratory facilities. The lease agreement, as amended in September 2016, commenced in March 2012 and will terminate in March 2018. Rent expense for the three months ended September 30, 2016 and 2015 was $55,000 and $55,000, respectively. Rent expense for the nine months ended September 30, 2016 and 2015 was $164,000 and $156,000, respectively.

As of September 30, 2016, future minimum payments under the lease are as follows (in thousands):

Year Ending December 31,
2016 ( remaining 3 months)	$	58
2017		303
2018		81
Total minimum lease payments	$	442

Indemnification Agreements

The Company enters into standard indemnification arrangements in the ordinary course of business. Pursuant to these arrangements, the Company indemnifies, holds harmless and agrees to reimburse the indemnified parties for losses suffered or incurred by the indemnified party, in connection with performance of services within the scope of the agreement, breach of the agreement by the Company, or noncompliance of regulations or laws by the Company, in all cases provided the indemnified party has not breached the agreement and/or the loss is not attributable to the indemnified party’s negligence or willful malfeasance. The term of these indemnification agreements is generally perpetual any time after the execution of the agreement. The maximum potential amount of future payments the Company could be required to make under these arrangements is not determinable. The Company has never incurred costs to defend lawsuits or settle claims related to these indemnification agreements. As a result, the Company believes the estimated fair value of these agreements is minimal.

Loss Contingencies

The Company is or has been subject to proceedings, lawsuits and other claims arising in the ordinary course of business. The Company evaluates contingent liabilities, including threatened or pending litigation, for potential losses. If the potential loss from any claim or legal proceeding in considered probable and the amount can be estimated, the Company accrues a liability for the estimated loss. Because of uncertainties related to these matters, accruals are based upon the best information available. For potential losses for which there is a reasonable possibility (meaning the likelihood is more than remote but less than probable) that a loss exists, the Company will disclose an estimate of the potential loss or range of such potential loss or include a statement that an estimate of the potential loss cannot be made. As additional information becomes available, the Company reassesses the potential liability related to pending claims and litigation and may revise its estimates, which could materially impact its condensed consolidated financial statements.

7. Common Stock

On June 17, 2016, in connection with the closing of the June 2016 Offering, we issued an aggregate of 3,105,000 shares of common stock, including the exercise of the underwriters’ overallotment option, at a public offering price of $5.00 per share for gross proceeds of approximately $15,525,000. The net proceeds to the Company, after the deduction of underwriting discounts, commissions and other offering expenses, were approximately $13,886,000.

Warrants for Common Stock

As of September 30, 2016, outstanding warrants to purchase shares of common stock were as follows:

					Number of
					Shares
					Outstanding
	Exercisable	Expiration	Exercise		Under
Issuance Date	for	Date	Price		Warrants

September 2014	Common Shares	September 23, 2019	$	4.24		91,532
October 2014	Common Shares	October 13, 2019	$	4.24		29,000
November 2014	Common Shares	November 12, 2019	$	4.24		12,500
February 2015	Common Shares	February 17, 2025	$	4.00		75,697
March 2015	Common Shares	March 26, 2025	$	2.72		1,454
May 2015	Common Shares	May 12, 2025	$	4.24		36,229
May 2015	Common Shares	May 17, 2020	$	4.24		21,585
December 2015	Common Shares	December 16, 2025	$	5.60		26,875
April 2016	Common Shares	April 1, 2026	$	6.08		25,000
May 2016	Common Shares	May 11, 2021	$	7.74		5,000
June 2016	Common Shares	June 20, 2026	$	4.98		100,402
						425,274

In connection with the 2014 Loan Agreement entered into on September 30, 2014, the Company issued a warrant to the Lender to purchase a total of 58,962 shares of common stock at an exercise price of $4.24 per share. The fair value of the warrant was recorded as debt issuance costs, presented in the condensed consolidated balance sheets as a deduction from the carrying amount of the note payable, and was being amortized to interest expense over the loan term. The outstanding indebtedness was repaid in June 2016 from the proceeds of the new term loan in connection with the 2016 Loan Agreement and the remaining unamortized balance of debt issuance costs was recorded to interest expense for the quarter ended June 30, 2016. During the three and nine months ended September 30, 2016, the Company recorded zero and $387,000, respectively, of interest expense relating to the debt issuance costs. During the three and nine months ended September 30, 2015, the Company recorded $47,000 and $141,000, respectively, of interest expense relating to the debt issuance costs. This warrant was exercised on a cashless basis in August 2016 and 17,295 net shares were issued.

In conjunction with the second amendment to the 2014 Loan Agreement in May 2015, the Company issued a warrant to the Lender to purchase a total of 3,125 shares of common stock at an exercise price of $2.96 per share. During the three and nine months ended September 30 2015, the Company recorded $2,000 and $10,000 of interest expense relating to the debt issuance costs for this warrant. The debt issuance costs for this warrant were fully amortized as of September 30, 2015. This warrant was exercised on a cashless basis in July 2016 and 885 net shares were issued.

In April 2016, the Company issued a common stock warrant to a distributor to purchase a total of 25,000 shares of common stock at an exercise price of $6.08 per share. The warrant has a contractual life of ten years and is exercisable immediately in whole or in part, on or before ten years from the issuance date. The Company determined the fair value of the warrant using the Black-Scholes option pricing model. Assumptions used were dividend yield of 0%, volatility of 72.1%, risk free interest rate of 1.78% and a contractual life of ten years. The fair value of the warrant was recorded as sales costs, which are included in selling, general and administrative expenses in the condensed consolidated statements of operations.

In May 2016, the Company issued common stock warrants to nonemployee contractors to purchase a total of 5,000 shares of common stock at an exercise price of $7.74 per share. The warrants have a contractual life of five years and are exercisable immediately in whole or in part, on or before five years from the issuance date. The Company determined the fair value of the warrants using the Black-Scholes option pricing model. Assumptions used were dividend yield of 0%, volatility of 61.6%, risk free interest rate of 1.20% and a contractual life of five years. The fair value of the warrants was recorded as clinical consulting costs, which are included in research and development expenses in the condensed consolidated statements of operations.

In connection with the 2016 Loan Agreement entered into on June 20, 2016, the Company issued a warrant to purchase a total of 100,402 shares of common stock at an exercise price of $4.98 per share. The warrant has a contractual life of ten years and is exercisable immediately in whole or in part, on or before ten years from the issuance date. The Company determined the fair value of the warrant on the date of issuance to be $350,000 using the Black-Scholes option pricing model. Assumptions used were dividend yield of 0%, volatility of 63.0%, risk free interest rate of 1.67% and a contractual life of ten years. The fair value of the warrant, along with other legal fees totaling $90,000, were recorded as debt issuance costs, presented in the condensed consolidated balance sheet as of September 30, 2016 as a deduction from the carrying amount of the note payable, and are being amortized to interest expense over the loan term. During the three and nine months ended September 30, 2016, the Company recorded $35,000 of interest expense relating to the debt issuance costs. As of September 30, 2016, the unamortized debt issuance cost was $405,000.

A total of 735 and 25,268 shares issuable pursuant to warrants issued in connection with a private offering on September 30, 2014 were exercised in 2015 and 2016, respectively.

A total of 5,157 and 1,094 shares issuable pursuant to warrants issued to two vendors in October 2014 were cancelled in 2015 and 2016, respectively, as the milestones related to these shares were not achieved.

The stock-based compensation expense related to warrants issued was zero and $162,000 for the three and nine months ended September 30, 2016, respectively. The stock-based compensation expense related to warrants issued was $16,000 and $396,000 for the three and nine months ended September 30, 2015, respectively.

8. Summary of Stock Options

Stock Option Plans

The Company has issued equity awards in the form of stock options and restricted stock awards from three employee benefit plans. The plans include the Company’s 2005 Stock Incentive Plan (the “2005 Plan”), the Viveve Amended and Restated 2006 Stock Plan (the “2006 Plan”) and the Company’s Amended and Restated 2013 Stock Option and Incentive Plan (the “2013 Plan”).

The 2005 Plan was adopted by the Company’s board of directors and approved by its stockholders. As of September 30, 2016, 1,892 shares of common stock remain reserved for issuance under the 2005 Plan. The Company does not intend to grant further awards from the 2005 Plan, however, it will continue to administer the 2005 Plan until all outstanding awards are exercised, expire, terminate or are forfeited. There are currently outstanding stock option awards issued from the 2005 Plan covering a total of 1,892 shares of the Company’s common stock. The weighted average exercise price of the outstanding stock options is $116.29 per share and the weighted average remaining contractual term is 0.98 years.

The 2006 Plan was adopted by the board of directors of Viveve, Inc. and was terminated in conjunction with the merger that took place on September 23, 2014 between PLC Systems Inc., Viveve, Inc. and PLC Systems Acquisition Corp. (the “Merger”). Prior to the Merger, the board of directors voted to accelerate the vesting of all unvested options that were outstanding as of the date of the Merger such that all options would be immediately vested and exercisable by the holders. In conjunction with the Merger, the Company agreed to assume and administer the 2006 Plan and all outstanding options to purchase shares of Viveve, Inc. common stock issued from the 2006 Plan were converted into options to purchase shares of the Company’s common stock (rounded down to the nearest whole share). The number of shares of the Company’s common stock into which the 2006 Plan options were converted was determined by multiplying the number of shares covered by each 2006 Plan option by the exchange ratio of 0.0080497 (or 0.0010062 on a post- reverse stock split basis). The exercise price of each 2006 Plan option was determined by dividing the exercise price of each 2006 Plan option immediately prior to the Merger by the exchange ratio of 0.0080497 (or 0.0010062 on a post- reverse stock split basis) (rounded up to the nearest cent). There are currently outstanding stock option awards issued from the 2006 Plan covering a total of 38,378 shares of the Company’s common stock and no shares are available for future awards. The weighted average exercise price of the outstanding stock options is $10.49 per share and the weighted average remaining contractual term is 6.13 years.

The 2013 Plan was also adopted by the Company’s board of directors and approved by its stockholders. The 2013 Plan is administered by the Compensation Committee of the Company’s board of directors (the “Administrator”). Under the 2013 Plan, the Company may grant equity awards to eligible participants which may take the form of stock options (both incentive stock options and non-qualified stock options), stock appreciation rights, restricted, deferred or unrestricted stock awards, performance based awards or dividend equivalent rights. Awards may be granted to officers, employees, nonemployee directors (as defined in the 2013 Plan) and other key persons (including consultants and prospective employees). The term of any stock option award may not exceed 10 years and may be subject to vesting conditions, as determined by the Administrator. Options granted generally vest over four years. Incentive stock options may be granted only to employees of the Company or any subsidiary that is a “subsidiary corporation” within the meaning of Section 424(f) of the Internal Revenue Code. The exercise price of any stock option award cannot be less than the fair market value of the Company’s common stock, provided, however, that an incentive stock option granted to an employee who owns more than 10% of the Company’s outstanding voting power must have an exercise price of no less than 110% of the fair market value of the Company’s common stock and a term that does not exceed five years.

On August 22, 2016, the Company’s stockholders approved an amendment to the 2013 Plan increasing the maximum number of shares of common stock reserved and available for awards under the 2013 Plan (the “Stock Issuable”) by 737,500 shares from 1,262,500 shares to a total of 2,000,000 shares and to add an “evergreen” provision to the 2013 Plan which will automatically increase annually, on the first day of each January, the Stock Issuable by an amount equal to the lesser of (i) the number of shares that will increase the Stock Issuable by 4% of the total number of shares of common stock outstanding (on a fully diluted basis) or (ii) an amount determined by the board of directors. As of September 30, 2016, there are outstanding stock option awards issued from the 2013 Plan covering a total of 1,275,538 shares of the Company’s common stock and there remain reserved for future awards 610,736 shares of the Company’s common stock. The weighted average exercise price of the outstanding stock options is $6.35 per share, and the remaining contractual term is 9.03 years.

Activity under the 2005 Plan, the 2006 Plan and the 2013 Plan is as follows:

	Nine Months Ended September 30, 2016
						Weighted
				Weighted		Average		Aggregate
	Number			Average		Remaining		Intrinsic
	of			Exercise		Contractual		Value
	Shares			Price		Term (years)		(in thousands)

Options outstanding, beginning of period		1,022,195		$	6.47		9.37	$	-
Options granted		378,932		$	7.25
Options exercised		(3,020	)	$	4.80
Options canceled		(82,299	)	$	7.55
Options outstanding, end of period		1,315,808		$	6.63		8.93	$	1,615,644

Vested and exercisable and expected to vest, end of period		1,221,813		$	6.65		8.90	$	1,523,776

Vested and exercisable, end of period		279,725		$	8.05		7.84	$	473,807

The aggregate intrinsic value reflects the difference between the exercise price of the underlying stock options and the Company’s closing share price as of September 30, 2016.

The options outstanding and exercisable as of September 30, 2016 are as follows:

			Options Outstanding						Options Exercisable
							Weighted
			Number		Weighted		Average		Number		Weighted
			Outstanding		Average		Remaining		Exercisable		Average
Range of			as of		Exercise		Contractual		as of		Exercise
Exercise Prices			September 30, 2016		Price		Term (Years)		September 30, 2016		Price

	$2.64			12,500	$	2.64		8.62		4,428	$	2.64
$3.68	-	$3.76		79,376	$	3.75		8.36		31,420	$	3.75
	$4.80			195,907	$	4.80		7.88		100,029	$	4.80
	$6.00			568,640	$	6.00		9.17		83,666	$	6.00
$6.24	-	$6.40		129,267	$	6.35		9.40		-	$	-
$7.00	-	$7.92		284,203	$	7.71		9.74		14,267	$	7.74
	$9.92			38,135	$	9.92		6.14		38,135	$	9.92
$56.00	-	$72.00		5,902	$	71.55		1.04		5,902	$	71.55
$96.00	-	$149.04		1,846	$	118.68		1.23		1,846	$	118.68
	$296.00			32	$	296.00		0.98		32	$	296.00
				1,315,808	$	6.63		8.93		279,725	$	8.05

Restricted Stock Awards

In January 2016, the Company granted restricted stock awards (“RSAs”) for 39,494 shares of common stock under the 2013 Plan to employees for 2015 accrued bonuses with a weighted average grant date fair value of $6.24 per share. The fair value of the RSAs was determined on the grant date based on the fair value of the Company’s common stock.

In August 2016, the Company granted RSAs for 5,998 shares of common stock under the 2013 Plan to board members as director compensation for the second quarter of 2016 with a weighted average grant date fair value of $7.89 per share. The RSAs were fully vested on the date of grant. The fair value of the RSAs was determined on the date of grant to be $47,000 based on the fair value of the Company’s common stock on that date.

In September 2016, the Company granted 25,000 shares to a consultant with a weighted average grant date fair value of $7.58 per share. The RSA vests over one year at a rate of 1/4 ^th per quarter beginning as of the award date. As of September 30, 2016, all 25,000 shares were unvested.

A total of 89 shares pursuant to a RSA granted in January 2016 were cancelled in September 2016.

The total number of shares pursuant to outstanding RSAs as of September 30, 2016 were 64,405 shares.

Stock-Based Compensation

During the three months ended September 30, 2016 and 2015, the Company granted stock options to employees to purchase 220,915 and 43,375 shares of common stock with a weighted average grant date fair value of $3.58 and $4.08 per share, respectively. During the nine months ended September 30, 2016 and 2015, the Company granted stock options to employees to purchase 378,932 and 135,250 shares of common stock with a weighted average grant date fair value of $3.54 and $2.56 per share, respectively. The aggregate intrinsic value of options exercised during the nine months ended September 30, 2016 and 2015 was $5,000 and zero, respectively.

The Company estimated the fair value of stock options using the Black-Scholes option pricing model. The fair value of employee stock options is being amortized on a straight-line basis over the requisite service period of the awards. The fair value of employee stock options granted was estimated using the following assumptions:

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2016			2015			2016			2015

Expected term (in years)		5			5			5			5
Average volatility		46	%		62	%		54	%		62	%
Risk-free interest rate		1.14	%		1.63	%		1.31	%		1.45	%
Dividend yield		0	%		0	%		0	%		0	%

Option-pricing models require the input of various subjective assumptions, including the option’s expected life and the price volatility of the underlying stock. The expected stock price volatility is based on analysis of the Company’s stock price history over a period commensurate with the expected term of the options, trading volume of comparable companies’ stock, look-back volatilities and Company specific events that affected volatility in a prior period. The expected term of employee stock options represents the weighted average period the stock options are expected to remain outstanding and is based on the history of exercises and cancellations on all past option grants made by the Company, the contractual term, the vesting period and the expected remaining term of the outstanding options. The risk-free interest rate is based on the U.S. Treasury interest rates whose term is consistent with the expected life of the stock options. No dividend yield is included as the Company has not issued any dividends and does not anticipate issuing any dividends in the future.

The following table shows stock-based compensation expense included in the condensed consolidated statements of operations for the three and nine months ended September 30, 2016 and 2015 (in thousands):

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2016		2015		2016		2015

Research and development	$	31	$	5	$	80	$	13
Selling, general and administrative		241		50		582		132
Total	$	272	$	55	$	662	$	145

As of September 30, 2016, the total unrecognized compensation cost in connection with unvested stock options was approximately $2,874,000. These costs are expected to be recognized over a period of approximately 3.21 years.

9. Income Taxes

For interim periods, the Company estimates its annual effective income tax rate and applies the estimated rate to the year-to-date income or loss before income taxes. The Company also computes the tax provision or benefit related to items reported separately and recognizes the items net of their related tax effect in the interim periods in which they occur. The Company also recognizes the effect of changes in enacted tax laws or rates in the interim periods in which the changes occur.

The Company’s effective tax rate is 0% for the three and nine months ended September 30, 2016 and 2015. The Company expects that its effective tax rate for the full year 2016 will be 0%.

10. Related Party Transactions

In June 2006, the Company entered into a Development and Manufacturing Agreement (the “Agreement”) with Stellartech Research Corporation (“Stellartech”). The Agreement was amended on October 4, 2007. Under the Agreement, the Company agreed to purchase 300 generators manufactured by Stellartech. As of September 30, 2016, the Company has purchased 222 units. The price per unit is variable and dependent on the volume and timing of units ordered. In conjunction with the Agreement, Stellartech purchased 37,500 shares of Viveve, Inc.’s common stock. Under the Agreement, the Company paid Stellartech $1,816,000 and $1,871,000 for goods and services during the three months ended September 30, 2016 and 2015, respectively, and $3,976,000 and $3,082,000 for goods and services during the nine months ended September 30, 2016 and 2015, respectively.

Delaware	04-3153858
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

Large accelerated filer ☐		Accelerated filer ☐

Non-accelerated filer ☐		Smaller reporting company ☒
(Do not check if a smaller reporting company)

Note About Forward-Looking Statements
		Page No .
PART I	FINANCIAL INFORMATION

Item 1.	Condensed Consolidated Financial Statements (unaudited)	4

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	18

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	26

Item 4.	Controls and Procedures	26

PART II	OTHER INFORMATION

Item 1.	Legal Proceedings	27

Item 1A.	Risk Factors	27

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	41

Item 3.	Defaults Upon Senior Securities	42

Item 4.	Mine Safety Disclosures	42

Item 5.	Other Information	42

Item 6.	Exhibits	43

SIGNATURES		44

Indication for Use:	No. of Countries:
General Surgical procedures for coagulation and hemostasis	3 Countries
For treatment of vaginal laxity	35 Countries
For treatment of the vaginal introitus, after vaginal childbirth, to improve sexual function	10 Countries
For vaginal rejuvenation	1 Country

			Less than						More than
Contractual Obligations:	Total		1 Year		1 - 3 Year		3 -5 Years		5 Years
Non-cancellable operating lease obligations	$	442	$	279	$	163	$	-	$	-
Debt obligations (including interest)		11,881		1,744		8,775		1,362		-
Total	$	12,323	$	2,023	$	8,938	$	1,362	$	-

	Three Months Ended
	September 30,				Change
	2016		2015		$		%
	(in thousands, except percentages)

Revenue	$	1,849	$	584		1,265		217	%

	●	delays in receipt of anticipated purchase orders;
	●	performance of our independent distributors;
	●	positive or negative media coverage of Geneveve, the Viveve Treatment or products of our competitors;
	●	our ability to obtain further regulatory clearances or approvals;
	●	delays in, or failure of, product and component deliveries by our subcontractors and suppliers;
	●	customer response to the introduction of new product offerings; and
	●	fluctuations in foreign currency.

	●	whether our marketing efforts directed toward increasing consumer awareness of the Viveve Treatment, for which we have limited experience and resources, are successful;
	●	the extent to which physicians recommend the Viveve Treatment to their patients;
	●	the cost, safety and effectiveness of a Viveve Treatment versus alternative treatments;
	●	general consumer sentiment about the benefits and risks of such procedures; and
	●	consumer confidence, which may be impacted by economic and political conditions.

	●	difficulties in staffing and managing international operations;
	●	difficulties in penetrating markets in which our competitors’ products may be more established;
	●	reduced or no protection for intellectual property rights in some countries;
	●	export restrictions, trade regulations and foreign tax laws;
	●	fluctuating foreign currency exchange rates;
	●	foreign certification and regulatory clearance or approval requirements;
	●	difficulties in developing effective marketing campaigns for unfamiliar, foreign countries;
	●	customs clearance and shipping delays;
	●	political and economic instability; and
	●	preference for locally produced products.

	●	hire qualified individuals as needed;
	●	provide adequate training for the effective sale of Geneveve; and
	●	retain and motivate sales employees.

	●	interruption of supply resulting from modifications to or discontinuation of a supplier’s operations;
	●	delays in product shipments resulting from uncorrected defects, reliability issues or a supplier’s variation in a component;
	●	a lack of long-term supply arrangements for key components with our suppliers;
	●	inability to obtain adequate supply in a timely manner, or to obtain adequate supply on commercially reasonable terms;
	●	difficulty locating and qualifying alternative suppliers for our components in a timely manner;
	●	production delays related to the evaluation and testing of products from alternative suppliers, and corresponding regulatory qualifications;
	●	delay in delivery due to suppliers prioritizing other customer orders over our orders;
	●	damage to our brand reputation caused by defective components produced by our suppliers;
	●	increased cost of our warranty program due to product repair or replacement based upon defects in components produced by our suppliers; and
	●	fluctuation in delivery by our suppliers due to changes in demand from us or from their other customers.

	●	untitled letters, warning letters, fines, injunctions, consent decrees and civil penalties;
	●	customer notifications for repair, replacement or refunds;
	●	recall, detention or seizure of our products;
	●	operating restrictions or partial suspension or total shutdown of production;
	●	refusing or delaying our requests for 510(k) clearance, de novo classification, or premarket approval of new products or modified products;
	●	operating restrictions;
	●	reclassifying a device that previously received a 510(k) clearance or withdrawing a PMA approval that was previously granted;
	●	refusal to grant export approval for our product; or
	●	criminal prosecution.

	●	actual or anticipated fluctuations in our quarterly financial results or the quarterly financial results of companies perceived to be similar to us;
	●	changes in the market’s expectations about our operating results;
	●	success of competitors;
	●	our operating results failing to meet the expectations of securities analysts or investors in a particular period;
	●	changes in financial estimates and recommendations by securities analysts concerning our business, the market for our products, the health services industry, or the healthcare and health insurance industries in general;
	●	operating and stock price performance of other companies that investors deem comparable to us;
	●	our ability to market new and enhanced products on a timely basis;
	●	changes in laws and regulations affecting our business;
	●	commencement of, or involvement in, litigation involving us;
	●	changes in our capital structure, such as future issuances of securities or the incurrence of debt;
	●	the volume of shares of our common stock available for public sale;
	●	any major change in our board of directors or management;
	●	sales of substantial amounts of common stock by our directors, executive officers or significant stockholders or the perception that such sales could occur; and
	●	general economic and political conditions such as recessions, fluctuations in interest rates and international currency fluctuations.

Exhibit Number		Document


3.1(1)		Certificate of Conversion for Delaware

3.1.1(1)		Certificate of Incorporation

3.1.2(2)		Articles of Amendment to the Articles of Continuance of Viveve Medical, Inc.

3.2(1)		Bylaws

10.1#(3)		Amendment No. 1 to the Viveve Medical, Inc. Independent Director Compensation Policy

10.2#(4)		Viveve Medical, Inc. Amended and Restated 2013 Stock Option and Incentive Plan

10.3*		Second Amendment to Standard Industrial/Commercial Multi-Tenant Lease – Gross, dated September 12, 2016 between Viveve, Inc. and Commercial Street Properties, LLC.

31.1*		Certification of the Company’s Principal Executive Officer pursuant to Rule 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2*		Certification of the Company’s Principal Financial and Accounting Officer pursuant to Rule 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1+		Certification of the Company’s Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2+		Certification of the Company’s Principal Financial and Accounting Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

99.1+		Press Release announcing 2016 Third Quarter Financial Results issued on November 10, 2016

101 .INS*		XBRL Instance Document

101.SCH* XBRL Taxonomy Extension Schema Document

101.CAL* XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF* XBRL Taxonomy Extension Definition Linkbase Document

101.LAB* XBRL Taxonomy Extension Label Linkbase Document

101.PRE* XBRL Taxonomy Extension Presentation Linkbase Document

Dated: November 10, 2016	VIVEVE MEDICAL, INC.
	(Registrant)

	By:	/s/ Patricia Scheller
		Patricia Scheller
		Chief Executive Officer Principal Executive Officer

	By:	/s/ Scott Durbin
		Scott Durbin
		Chief Financial Officer Principal Financial and Accounting Officer

Months of Extended Term	Monthly Base Rent		Annual Base Rent

April 1, 2017 - March 31, 2018	$	27,219.50	$	326,634

Date: November 10, 2016	/s/ Patricia Scheller
	Patricia Scheller
	Chief Executive Officer
	(Principal Executive Officer)