UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒	QUARTERLY report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934

For the Quarterly Period Ended September 30, 2024
or

☐	Transition report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934

	For the Transition Period from to

Commission File Number: 001-39796

Vivos Therapeutics, Inc.

(Exact Name of Registrant as Specified in its Charter)

Delaware		81-3224056
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

7921 Southpark Plaza, Suite 210, Littleton, CO		80120
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code:		(844) 672-4357

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading symbol(s)		Name of exchange on which registered
Common stock, par value $0.0001 per share		VVOS		Nasdaq Capital Market

Indicate by check mark whether the registrant (1) has 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, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” or “emerging growth company” in Rule 12b-2 of the Exchange Act.

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 ☒

The registrant had 4,835,300 shares of its common stock, $0.0001 par value per share, outstanding as of November 14, 2024.

TABLE OF CONTENTS

		Page

	Cautionary Note Regarding Forward-Looking Statements	3

PART I.	FINANCIAL INFORMATION	4

Item 1.	Condensed Consolidated Financial Statements (Unaudited)	4
	Condensed Consolidated Balance Sheets as of September 30, 2024 and December 31, 2023	4
	Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2024 and 2023	5
	Condensed Consolidated Statements of Stockholders’ Equity as of September 30, 2024 and 2023	6
	Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2024 and 2023	7
	Notes to the Condensed Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	31
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	43
Item 4.	Controls and Procedures	44

PART II.	OTHER INFORMATION	45

Item 1.	Legal Proceedings	45
Item 1A.	Risk Factors	45
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	46
Item 3.	Defaults Upon Senior Securities	47
Item 4.	Mine Safety Disclosures	47
Item 5.	Other Information	47
Item 6.	Exhibits, Financial Statement Schedules	48

	Signatures	49

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (this “Report”) contains “forward-looking statements” (as defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended) that reflect our current expectations and views of future events. The forward-looking statements are contained principally in the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Readers are cautioned that known and unknown risks, uncertainties and other factors, including those over which we may have no control and others listed in this Report and our other public filings, may cause our actual results, performance or achievements to be materially different from those expressed or implied by the forward-looking statements.

You can identify some of these forward-looking statements by words or phrases such as “may,” “hope,” “will,” “expect,” “anticipate,” “aim,” “estimate,” “intend,” “plan,” “believe,” “is/are likely to,” “potential,” “continue” or other similar expressions. We have based these forward-looking statements largely on our current expectations and projections about future events that we believe may affect our financial condition, results of operations, business strategy and financial needs. These forward-looking statements include statements relating to:

	●	our ability to continue to refine and execute our business plan, including the recruitment of dentists to enroll in our Vivos Integrated Practice (“VIP”) program and utilize The Vivos Method;

	●	our ability to establish and grow our new marketing and distribution model where we create contractual alliances with operators of multiple sleep testing and treatment centers as a means of driving sales of our appliances;

	●	the understanding and adoption by dentists and other healthcare professionals of The Vivos Method, including our proprietary oral appliances, as a treatment for dentofacial abnormalities and/or mild to severe obstructive sleep apnea (“OSA”) and snoring in adults and moderate to severe OSA and snoring in children;

	●	our expectations concerning the effectiveness of treatment using The Vivos Method and patient relapse after completion of treatment;

	●	the potential financial benefits to VIP dentists from treating patients with The Vivos Method;

	●	our potential revenues and profit margin from the enrollment of VIPs, VIP service fees, sales of The Vivos Method treatments and appliances, leases of SleepImage^®home sleep testing rings and from our strategic alliance marketing and distribution model;

	●	our ability to properly train VIPs in the use of The Vivos Method inclusive of the services we offer independent dentists for use in treating their patients in their dental practices;

	●	our ability to formulate, implement and modify as necessary effective sales, marketing and strategic initiatives to drive revenue growth including, for example, our new strategic alliance marketing and distribution model, our Medical Integration Division, SleepImage^®home sleep apnea test, arrangements with durable medical equipment companies (“DMEs”) and other third-party collaborations;

	●	the viability of our current intellectual property and intellectual property created in the future;

	●	acceptance by the marketplace of the products and services that we market;

	●	government regulations and our ability to obtain applicable regulatory approvals and comply with government regulations including under healthcare laws and the rules and regulations of the U.S. Food and Drug Administration (“FDA”) and non-U.S. equivalent regulatory bodies as well as laws, rules and regulations related to the practice of medicine or dentistry;

	●	our ability to retain key employees;

	●	adverse changes in general market conditions for medical devices and the products and services we offer;

	●	our ability to generate cash flow and profitability and continue as a going concern;

	●	our future financing plans; and

	●	our ability to adapt to changes in market conditions (including as a result of outbreaks of disease such as COVID-19, inflation and volatile geopolitical and capital markets) which could impair our operations, financial performance and ability to raise new capital.

These forward-looking statements involve numerous risks and uncertainties. Although we believe that our expectations expressed in these forward-looking statements are reasonable, our expectations may later be found to be incorrect. Our actual results of operations or the results of other matters that we anticipate herein could be materially different from our expectations. Important risks and factors that could cause our actual results to be materially different from our expectations are generally set forth in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” “Business” and other sections in this Report as well as the “Risk Factors” section of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 and our other public filings. You should thoroughly read this Report and the documents that we refer to with the understanding that our actual future results may be materially different from and worse than what we expect. We qualify all of our forward-looking statements by these cautionary statements.

The forward-looking statements made in this Report relate only to events or information as of the date on which the statements are made in this Report. Except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events. You should read this Report and the documents that we refer to in this Report and have filed as exhibits to this Report and our other public filings, completely and with the understanding that our actual future results may be materially different from what we expect.

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements.

VIVOS THERAPEUTICS INC.

Unaudited Condensed Consolidated Balance Sheets

(In Thousands, Except Per Share Amounts)

	September 30, 2024			December 31, 2023

Current assets
Cash and cash equivalents	$	6,311		$	1,643
Accounts receivable, net of allowance of $262 and $250, respectively		454			202
Prepaid expenses and other current assets		634			616

Total current assets		7,399			2,461

Long-term assets
Goodwill		2,843			2,843
Property and equipment, net		3,317			3,314
Operating lease right-of-use asset		1,129			1,385
Intangible assets, net		383			420
Deposits and other		276			307

Total assets	$	15,347		$	10,730

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable	$	1,075		$	2,145
Accrued expenses		2,054			2,334
Current portion of contract liabilities		1,313			2,138
Current portion of operating lease liability		485			474
Other current liabilities		199			198

Total current liabilities		5,126			7,289

Long-term liabilities
Contract liabilities, net of current portion		178			289
Employee retention credit liability		1,220			1,220
Operating lease liability, net of current portion		1,158			1,521

Total liabilities		7,682			10,319

Commitments and contingencies (Note 11)		-			-

Stockholders’ equity
Preferred Stock, $0.0001 par value per share. Authorized 50,000,000 shares; no shares issued and outstanding		-			-
Common Stock, $0.0001 par value per share. Authorized 200,000,000 shares; issued and outstanding 4,765,300 shares as of September 30, 2024 and 1,833,877 shares as December 31, 2023		-			-
Additional paid-in capital		109,025			93,462
Accumulated deficit		(101,360	)		(93,051	)
Total stockholders’ equity		7,665			411
Total liabilities and stockholders’ equity	$	15,347		$	10,730

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

VIVOS THERAPEUTICS INC.

Unaudited Condensed Consolidated Statements of Operations

(In Thousands, Except Per Share Amounts)

	2024			2023			2024			2023
	Three Months Ended September 30,						Nine Months Ended September 30,
	2024			2023			2024			2023
Revenue
Product revenue	$	1,958		$	1,466		$	5,608		$	4,783
Service revenue		1,902			1,835			5,725			5,770
Total revenue		3,860			3,301			11,333			10,553

Cost of sales (exclusive of depreciation and amortization shown separately below)		1,526			1,554			4,411			4,371

Gross profit		2,334			1,747			6,922			6,182

Operating expenses
General and administrative		4,487			4,596			13,531			17,012
Sales and marketing		346			641			1,319			1,861
Depreciation and amortization		146			150			437			472

Total operating expenses		4,979			5,387			15,287			19,345

Operating loss		(2,645	)		(3,640	)		(8,365	)		(13,163	)

Non-operating income (expense)
Other expense		(18	)		(53	)		(42	)		(198	)
Excess warrant fair value		-			-			-			(6,453	)
Change in fair value of warrant liability, net of issuance costs of $645		-			1,600			-			10,362
Other income		47			-			98			128
Loss before income taxes		(2,616	)		(2,093	)		(8,309	)		(9,324	)

Net loss	$	(2,616	)	$	(2,093	)	$	(8,309	)	$	(9,324	)

Net loss per share (basic and diluted)	$	(0.40	)	$	(1.75	)	$	(1.94	)	$	(8.09	)
Weighted average number of shares of Common Stock outstanding (basic and diluted)		6,615,320			1,197,258			4,282,210			1,152,607

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

VIVOS THERAPEUTICS INC.

Unaudited Condensed Consolidated Statements of Stockholders’ Equity

(In Thousands, Except Common Stock Amounts)

	Shares		Amount		Capital			Deficit			Total
	Nine Months Ended September 30, 2024 and 2023
					Additional
	Common Stock				Paid-in			Accumulated
	Shares		Amount		Capital			Deficit			Total

Balances, December 31, 2022		920,592	$	-	$	84,269		$	(79,468	)	$	4,801
Issuance of common stock in private placement, net of issuance costs		80,000		-		-			-			-
Issuance of common stock for purchase of assets		10,000		-		116			-			116
Issuance of commons stock upon exercise of warrants		186,666		-		2,848			-			2,848
Fair value of warrants issued:
Issuance of warrants to consultants for services		-		-		625			-			625
Stock-based compensation expense		-		-		306			-			306
Net loss		-		-		-			(1,703	)		(1,703	)

Balances, March 31, 2023		1,197,258	$	-	$	88,164		$	(81,171	)	$	6,993
Fair value of warrants issued:
To consultants for services		-		-		182			-			182
Stock-based compensation expense		-		-		459			-			459
Net loss		-		-		-			(5,528	)		(5,528	)

Balances, June 30, 2023		1,197,258	$	-	$	88,805		$	(86,699	)	$	2,106
Fair value of warrants issued:
To consultants for services		-		-		(156	)		-			(156	)
Stock-based compensation expense		-		-		189			-			189
Net loss		-		-		-			(2,093	)		(2,093	)

Balances, September 30, 2023		1,197,258	$	-	$	88,838		$	(88,792	)	$	46

Balances, December 31, 2023		1,833,877	$	-	$	93,462		$	(93,051	)	$	411
Issuance of commons stock upon exercise of warrants, net of issuance costs		897,393		-		3,635			-			3,635
Issuance of warrants to consultants for services		-		-		6			-			6
Stock-based compensation expense		-		-		293			-			293
Net loss		-		-		-			(3,763	)		(3,763	)

Balances, March 31, 2024		2,731,270	$	-	$	97,396		$	(96,814	)	$	582
Issuance of common stock and warrants in private placement, net of issuance costs		169,498		-		7,400			-			7,400
Issuance of commons stock upon exercise of warrants, net of issuance costs		496,000		-		-			-			-
Issuance of common stock to consultants for services		4,720				11						11
Issuance of warrants to consultants for services		-		-		14			-			14
Stock-based compensation expense		-		-		270			-			270
Net loss		-		-		-			(1,930	)		(1,930	)

Balances, June 30, 2024		3,401,488	$	-	$	105,091		$	(98,744	)	$	6,347
Balance		3,401,488	$	-	$	105,091		$	(98,744	)	$	6,347
Issuance of common stock and warrants in private placement, net of issuance costs		1,363,812		-		3,786			-			3,786
Issuance of warrants to consultants for services		-		-		6			-			6
Stock-based compensation expense		-		-		142			-			142
Net loss		-		-		-			(2,616	)		(2,616	)

Balances, September 30, 2024		4,765,300	$	-	$	109,025		$	(101,360	)	$	7,665
Balance		4,765,300	$	-	$	109,025		$	(101,360	)	$	7,665

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

VIVOS THERAPEUTICS INC.

Unaudited Condensed Consolidated Statements of Cash Flows

(In Thousands)

	2024			2023
	Nine Months Ended September 30,
	2024			2023

CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(8,309	)	$	(9,324	)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation expense		705			954
Depreciation and amortization		437			472
Fair value of common stock issued for services		11			-
Fair value of warrants issued for services		26			651
Change in fair value of warrant liability, net of issuance costs of $645		-			(10,362	)
Excess warrant fair value		-			6,453
Changes in operating assets and liabilities:
Accounts receivable		(252	)		229
Operating lease liabilities, net		(95	)		(81	)
Prepaid expenses and other current assets		(19	)		679
Deposits		44			81
Accounts payable		(1,070	)		118
Accrued expenses		(293	)		42
Employee retention credit liability		-			1,220
Other liabilities		(1	)		94
Contract liability		(935	)		(424	)

Net cash used in operating activities		(9,751	)		(9,198	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisitions of property and equipment		(403	)		(638	)
Payment for asset purchase		-			(50	)

Net cash used in investing activities		(403	)		(688	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock		4,296			-
Proceeds from exercise of warrants		7,500			-
Proceeds from exercise of pre-funded warrants		3,941			8,000
Payments for issuance costs		(915	)		(645	)

Net cash provided by financing activities		14,822			7,355

Net increase (decrease) in cash and cash equivalents		4,668			(2,531	)
Cash and cash equivalents at beginning of year		1,643			3,519

Cash and cash equivalents at end of year	$	6,311		$	988

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for interest	$	7		$	-

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Fair value of warrants issued in asset purchase	$	-		$	116
Fair value of warrants issued in private placement	$	262		$	-

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

VIVOS THERAPEUTICS INC.

Notes to Unaudited Condensed Consolidated Financial Statements

NOTE 1 - ORGANIZATION, DESCRIPTION AND SIGNIFICANT ACCOUNTING POLICIES

Organization

BioModeling Solutions, Inc. (“BioModeling”) was organized on March 20, 2007 as an Oregon limited liability company, and subsequently incorporated in 2013. On August 16, 2016, BioModeling entered into a share exchange agreement (the “SEA”) with First Vivos, Inc., a Texas corporation (“First Vivos”), and Vivos Therapeutics, Inc., a Wyoming corporation (“Vivos”), which was established on July 7, 2016 to facilitate the SEA transaction. Pursuant to the SEA, all of the outstanding shares of common stock and warrants of BioModeling and all of the shares of common stock of First Vivos were exchanged for newly issued shares of common stock and warrants of Vivos, the legal acquirer.

The transaction was accounted for as a reverse acquisition and recapitalization, with BioModeling as the acquirer for financial reporting and accounting purposes. Upon the consummation of the merger, the historical financial statements of BioModeling became the Company’s historical financial statements and recorded at their historical carrying amounts.

On August 12, 2020, Vivos reincorporated from Wyoming to become a domestic Delaware corporation under Delaware General Corporate Law. Accordingly, as used herein, the term “the Company,” “we,” “us,” “our” and similar terminology refer to Vivos Therapeutics, Inc., a Delaware corporation, and its consolidated subsidiaries. As used herein, the term “Common Stock” refers to the common stock, $0.0001 par value per share, of Vivos Therapeutics, Inc., a Delaware corporation.

Reverse Stock Split

On October 25, 2023, the Company effected a reverse stock split of its outstanding shares of common stock at a ratio of 1-for-25 (the “Reverse Stock Split”). The Reverse Stock Split, which was approved by the Company’s Board of Directors under authority granted by the Company’s stockholders at the Company’s 2023 Annual Meeting of Stockholders held on September 22, 2023, was consummated pursuant to a Certificate of Amendment filed with the Secretary of State of Delaware on October 25, 2023 (the “Certificate of Amendment”). Unless the context otherwise requires, all references in the accompanying financial statements, these footnotes to the financial statements in general to shares of the Company’s common stock, including prices per share of the common stock, reflect the Reverse Stock Split. Fractional shares were not issued, and the final number of shares were rounded up to the next whole share.

Description of Business

We are a medical technology and services company that features a comprehensive suite of proprietary oral appliances and therapeutic treatments. Our products non-surgically treat certain maxillofacial and developmental abnormalities of the mouth and jaws that are closely associated with breathing and sleep disorders such as mild to severe obstructive sleep apnea (“OSA”) and snoring in adults. The Company offers three separate clinical pathways or programs to providers—Guided Growth and Development, Lifeline, and Complete Airway Repositioning and Expansion (“CARE”). Each program features certain oral appliances coupled with specific therapeutic treatments, and each clinical pathway is intended to address the specific needs of a diverse patient population with different patient needs. For example, the Guided Growth and Development program features the Vivos Guide and PE^xappliances along with adjunctive, non-Company therapies used by a dentist (such as CO₂ laser treatments and other therapies) designed for treating palatal growth (growth of the mouth roof) and expansion in pediatric patients as they grow. The mid-range priced Lifeline program features a selection of mandibular advancement devices (“MADs”) such as the Versa and Vida Sleep which are FDA 510(k) cleared for mild-to-moderate OSA in adults, along with the patented Vida appliance, which is FDA 510(k) cleared as unspecified classification for the alleviation of Temporomandibular Joint Dysfunction (“TMD”) symptoms, bruxism, migraine headaches, and nasal dilation.

The Company’s flagship CARE program, which is part of The Vivos Method, features the Company’s patented DNA, mRNA and mmRNA appliances, which are also FDA 510(k) cleared for mild-to-severe OSA and snoring in adults. The Vivos Method may also include adjunctive myofunctional, chiropractic/physical therapy, and laser treatments that, when properly used with the CARE appliances, constitute a powerful non-invasive and cost-effective means of reducing or eliminating OSA symptoms. In a small subset of a study, the data has actually shown that The Vivos Method can reverse OSA symptoms in a large portion (up to 80%) of patients. The primary competitive advantage of The Vivos Method over other OSA therapies is that The Vivos Method’s typical course of treatment is limited in most cases to 12 to 15 months, and it is possible not to need lifetime intervention, unlike CPAP and neuro-stimulation implants. Additionally, out of over 47,000 patients treated to date worldwide with the Company’s entire current suite of products, there have been very few instances of relapse.

The Company also offers a suite of diagnostic and support products and services to dental and medical providers and distributors who treat patients with OSA or related conditions. Such products and services include (i) VivoScore home sleep screenings and tests (powered by SleepImage^®technology), (ii) AireO2 (an electronic health record program designed specifically for use by dentists treating sleep patients), (iii) Treatment Navigator (a concierge service to assist a provider in educating and supporting the doctors as they navigate insurance coverage, diagnostic indications and treatment options), (iv) Billing Intelligence Services (“BIS”) (which optimizes medical and dental reimbursement), (v) advanced training and continuing education courses at the Company’s Vivos Institute in Denver, Colorado, (vi) MyoCorrect, a service through which Vivos-trained providers can provide orofacial myofunctional therapy (“OMT”) to patients via a telemedicine platform, and (vii) the Company’s Medical Integration Division (“MID”), which manages independent medical practices under management and development agreements which pays the Company from six (6%) to eight (8%) percent of all net revenue from sleep-related services as well as development fees.

Another aspect of the Company’s business model is to teach, train, and support dentists, medical doctors, and distributors in the use of the Company’s products and services. Dentists who use the Company’s products and services typically enroll in a variety of live or online training and educational programs offered through the Company’s Vivos Institute—an 18,000 sq. ft. facility located near the Denver International Airport. Dentists are able to select the specific program or clinical pathway that they want to focus on, such as Guided Growth and Development or Lifeline or both. Dentists may also enroll in the VIP program for the complete set training, educational, and support services available in all three clinical pathway programs. Dentists enrolled in the VIP Program are referred to as “VIPs.” The Company charges upfront enrollment fees to educate and train new providers. The Company also charges for the ancillary support services listed above and views each product and service as a revenue/profit center.

Further, in an effort to expand its potential for revenue generation, in June 2024, the Company entered into a strategic marketing and distribution alliance with an operator of multiple sleep testing and treatment centers in Colorado, under which each party’s products and services will be offered together as a comprehensive solution to OSA patients seeking obstructive sleep apnea treatment. Under this model, the Company will invoice patients (rather than dentists), for treatment by Vivos employed dentists. The Company anticipates this will be the first of a series of similar alliances across the country, marking an important pivot in the Company’s marketing and distribution model for treating patients and distributing its cutting edge OSA appliances.

Basis of Presentation and Consolidation

The Company’s unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). Any reference in these notes to applicable guidance is meant to refer to the authoritative GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”) of the Financial Accounting Standards Board (“FASB”).

In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments, consisting of normal recurring adjustments, which are necessary to present fairly the Company’s financial position, results of operations, and cash flows. The condensed consolidated balance sheet at December 31, 2023 has been derived from audited financial statements at that date. The interim results of operations are not necessarily indicative of the results that may occur for the full fiscal year. Certain information and footnote disclosure normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to instructions, rules, and regulations prescribed by the United States Securities and Exchange Commission (“SEC”).

The Company believes that the disclosures provided herein are adequate to make the information presented not misleading when these unaudited condensed consolidated financial statements are read in conjunction with the December 31, 2023 audited consolidated financial statements contained in the Company’s 2023 Annual Report on Form 10-K, which was filed with the Securities and Exchange Commission on March 28, 2024.

Emerging Growth Company Status

The Company is an “emerging growth company” (an “EGC”), as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and as a result, the Company may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not EGCs. These include, but are not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”), reduced disclosure obligations regarding executive compensation, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.

Further, Section 102(b)(1) of the JOBS Act exempts EGCs from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-EGC but any such election to opt out is irrevocable. The Company currently expects to retain its status as an EGC until the year ending December 31, 2026, but this status could end sooner under certain circumstances.

Revenue Recognition

The Company generates revenue from the sale of products and services. A significant majority of the Company’s revenues are generated from enrolling dentists as either (i) Guided Growth and Development VIPs; (ii) Lifeline VIPs; (iii) combined Guided Growth and Development and Lifeline VIPs; or Premier Vivos Integrated Providers (“Premier VIPs”). Prior to the second quarter of 2023, the majority of VIP enrollments were Premier VIPs. The other, lower priced enrollments were piloted in prior fiscal quarters on a limited basis. They were officially adopted during the second quarter of 2023. For each VIP program, revenue is recognized when control of the products or services is transferred to customers (i.e., VIP dentists ordering such products or services for their patients) in a manner that reflects the consideration the Company expects to be entitled to in exchange for those products and services.

Following the guidance of ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”) and the applicable provisions of ASC Topic 842, Leases (“ASC 842”), the Company determines revenue recognition through the following five-step model, which entails:

	1)	identification of the promised goods or services in the contract;
	2)	determination of whether the promised goods or services are performance obligations, including whether they are distinct in the context of the contract;
	3)	measurement of the transaction price, including the constraint on variable consideration;
	4)	allocation of the transaction price to the performance obligations; and

SEC Form 10-Q filed by Vivos Therapeutics Inc.