What changed in this filing

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Item 1. Financial Statements

2023-05-15 compared with 2022-11-14 · 251 added, 304 removed, 206 unchanged (73% of the section changed)

3 unchanged sentences

in thousands, except per share data)

September 30,

CURRENT ASSETS

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Income taxes payable

Other current liabilities

Total current liabilities

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SHAREHOLDERS’ EQUITY

Common stock, without par value, 300,000,000 shares authorized, 300,000,000 issued and outstanding as of September 30, 2022, and as of December 31, 2021

Common stock, without par value, 300,000,000 shares authorized, 300,000,000 issued and outstanding as of March 31, 2023, and as of December 31, 2022

Additional paid-in capital

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in thousands, except per share data)

For the Three Months Ended September 30,

Revenue earned

Service revenue

Cost of revenue

Selling, general, and administrative expenses

Operating loss

Other income (expense)

Interest income

Interest expense

Other income (expense)

Income before income tax expense

Income tax expense

Consolidated net income

Net income per share:

Shares used in per share computation:

accompanying notes are an integral part of these statements.

AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF OPERATIONS

in thousands, except per share data)

For the Nine Months Ended September 30,

For the Three Months Ended March 31,

Revenue earned

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Other income (expense)

Interest income from related parties

Interest income

Interest expense

Income (loss) before income tax expense

Other (expense)

Loss before income tax expense

Income tax expense

Consolidated net income (loss)

Consolidated net loss

Net income per share:

Shares used in per share computation:

Share used in per share computation:

accompanying notes are an integral part of these statements.

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CONSOLIDATED STATEMENTS OF CHANGE IN EQUITY

the Nine Months Ended September 30, 2022 and 2021

the Three Months Ended March 31, 2023 and 2022

in thousands, except per share data)

Balance, December 31, 2021

Balance, September 30, 2021

Balance, March 31, 2022

Balance, December 31, 2022

Income (Loss)

Balance, September 30, 2022

Balance, March 31, 2023

accompanying notes are an integral part of these statements.

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in thousands)

For the Nine Months Ended September 30,

For the Three Months Ended March 31,

Cash flows from operating activities:

Net income (loss)

Adjustments to reconcile net (loss) to net cash provided by operating activities:

Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

Depreciation and amortization

Accrued interest

(Gain)/loss on disposal of property and equipment

Gain on forgiveness of PPP loan payable

Changes in operating assets and liabilities:

Trade receivables

Retention credit receivable

Prepaid expenses and other current assets

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Accrued expenses

Deferred revenue

Other liabilities

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Purchase of fixed assets

Net cash provided by (used in) investing activities

Net cash used in investing activities

Cash flows from financing activities:

Net borrowing/(repayment) of factoring liability

Borrowing of note payable

Net borrowing/(repayment) of line-of-credit

Advances to related parties

Net cash provided by (used in) financing activities

Net increase in cash and cash equivalents

Net increase (decrease) in cash and cash equivalents

Cash and cash equivalents, beginning of year

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in thousands)

For the Nine Months Ended September 30,

For the Three Months Ended March 31,

Supplemental disclosures of cash flow information:

Cash paid during the period for:

Supplemental disclosures of non-cash investing and financing activities:

The Company received forgiveness from the SBA of its PPP loan payable

Cash paid during the year for:

INCORPORATED AND SUBSIDIARY

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of Operations

Incorporated is a leading provider of Workforce Management & Staffing Solutions, along with its wholly owned subsidiary, The Maslow Media

Group, Inc (“MMG”), (collectively, “Reliability” or the “Company”), primarily within the United States

of America in four industry segments:

Employer of Record (“EOR”), Recruiting and Staffing, Direct Placements, and Video and

Multimedia Production Services.

Our Staffing segment provides skilled field talent on a nationwide basis for Media, Video Production,

IT, and Finance and Accounting client partner projects.

Our Staffing segment occasionally receives requests for direct placements.

Production involves assembling and providing crews for special projects that can last anywhere from a week to 6 months.

is a leading provider of employer of record and temporary media and information technology (“IT”) staffing services

that operates, along with its wholly owned subsidiary, The Maslow Media Group, Inc (“MMG”), (collectively, “Reliability”

or the “Company”), primarily within the United States of America in four industry segments:

Employer of Record (“EOR”),

Recruiting and Staffing, Direct Placements, and Video and Multimedia Production which provides script to screen media talent.

segment provides skilled field talent on a nationwide basis for Media, IT and finance and accounting client partner projects.

Video Production

involves assembling and providing crews for special projects that can last anywhere from a week to 6 months.

was incorporated under the laws of the State of Texas in 1953, but the then principal business of the Company started in 1971 was closed

down in 2007.

The Company completed a reverse merger with MMG (the “Merger”) on October 29, 2019.

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Valleru, Igly Trust, and Judos Trust also

have common ownership combinations in a number of other entities [Vivos Holdings, LLC.

Vivos Real Estate Holdings, LLC (“VREH”),

have common ownership combinations in a number of other entities [Vivos Holdings, LLC, Vivos Real Estate Holdings, LLC (“VREH”),

Vivos Holdings, Inc., Vivos Group, Vivos Acquisitions, LLC, and Federal Systems, LLC], (collectively referred to herein as “Vivos

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in control” of Reliability.

Upon purchasing MMG and thereafter, Vivos Holdings,

LLC and their affiliates (collectively the “Vivos Group”) began borrowing monies from MMG starting with $ 1,400 in 2016 and

by the end of 2019 the balance had reached $ 3,418 which included a $ 3,000 guarantee from Dr.

INCORPORATED AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

in thousands, except per share data)

purchasing MMG and thereafter, Vivos Holdings, LLC and their affiliates (collectively the “Vivos Group”) began borrowing

monies from MMG starting with $ 1,400 in 2016 and by the end of 2019 the balance had reached $ 3,418 which included a $ 3,000 guarantee

(See Note 8 for more details).

or about February 25, 2020, the Company, as plaintiff, filed a complaint with the Circuit Court of Montgomery County, Maryland against

Vivos Holdings, LLC, Vivos Real Estate Holdings, LLC and Dr.

Doki (collectively “Vivos Debtors”), to enforce Maslow’s

rights under certain promissory notes and a personal guarantee made by the Dr.

RELIABILITY INCORPORATED AND SUBSIDIARY

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022

(amounts in thousands, except per share data)

or about May 6, 2020, the Vivos Debtors filed a counterclaim and third-party complaint for damages, declaratory and injunctive relief,

and jury demand (the “Counterclaim”).

refer below to the disputes between Reliability and the Vivos Group as the “Vivos Matter.”

March 21, 2022, the Company began agreed upon arbitration proceedings against the Vivos Group.

Among several claims, MMG sought remedy on three notes, plus a guarantee totaling approximately $ 5,039 when the arbitration

hearing began.

August 2, 2022, VREH filed for Chapter 11 Bankruptcy Protection in the District Court of Maryland.

This action prevented the Arbitrator

from providing any ruling relating to Note II in the arbitration case at the time of his award.

August 24 , 2022, the Company filed a motion to stay the VREH Bankruptcy filing to allow the Arbitrator to rule on the claims

against VREH.

The motion to lift the stay was granted by the court on September 16, 2022, after the initial award by the Arbitrator.

attempted collection of the guarantee and debt from the Vivos Group set off a chain of legal events culminating in an arbitration hearing

and award in 2022.

(See below and Item 3 for complete summary).

We refer below to the disputes between Reliability and the Vivos Group

as the “Vivos Matter.”

series of legal actions and hearings took place starting in March of 2020 through September of 2021.

At that time, Arbitration was agreed

by both the Vivos Group and MMG, The proceedings began in February 2022 and were completed in March 2022.

August 31, 2022, the Arbitrator issued an award (the “Award”) with the Company and MMG prevailing on their claims.

and MMG were awarded the following:

award in favor of MMG against Vivos Holdings LLC under Note I (as defined in the Award) in the amount of $ 3,458,377 ,

with interest thereon from June 30, 2022, at the rate of 4.5 %

award in favor of MMG against Vivos Holdings LLC under Note I (as defined in the Award) in the amount of $ 3,458 , with interest thereon

from June 30, 2022, at the rate of 4.5 % per year;

award as to Note II (as defined in the Award) until and at such time as the automatic stay imposed by the United States Bankruptcy

Court as a result of the filing of a petition in bankruptcy by VREH is lifted or the bankruptcy proceeding is terminated;

award in favor of MMG against Vivos Holdings, LLC under Note III (as defined in the Award) in the amount of $ 800,448 ,

with interest thereon from June 30, 2022, at the rate of 2.5 %

per year, plus collection costs, including reasonable attorneys’ fees, incurred in the effort to collect Note III;

award in favor of MMG against Vivos Holdings, LLC under Note III (as defined in the Award) in the amount of $ 800 , with interest thereon

from June 30, 2022, at the rate of 2.5 % per year, plus collection costs, including reasonable attorneys’ fees, incurred in

the effort to collect Note III;

award in favor of MMG against Naveen under the Personal Guaranty (as defined in the Award) in the amount of $ 2,309 , plus interest

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award in favor of the Company against Naveen, Valleru, Janumpally, individually and as Trustee of Judos Trust, and Pathuri, as Trustee

of Igly Trust, jointly and severally, for contract damages of $ 1,000,000 , to be satisfied by the transfer of their shares of the

Company common stock to the Company equal in value to $ 1,000,000 , valued as of the date of the Award, in accordance with the provisions

of Section 9.06(d) of the Merger Agreement;

of Igly Trust, jointly and severally, for contract damages of $ 1,000 , to be satisfied by the transfer of their shares of the Company

common stock to the Company equal in value to $ 1,000 , valued as of the date of the Award, in accordance with the provisions of Section

9.06(d) of the Merger Agreement;

award in favor of the Company against Naveen, Valleru, Janumpally, individually and as Trustee of Judos Trust, and Pathuri, as Trustee

of Igly Trust, jointly and severally, for fraud damages in the amount of $ 4,327,127 , plus interest thereon at the rate of 6 % per

year from the date of the Award, together with any out-of-pocket fees and expenses, including attorneys’ and accountants’

of Igly Trust, jointly and severally, for fraud damages in the amount of $ 4,327 , plus interest thereon at the rate of 6 % per year

from the date of the Award, together with any out-of-pocket fees and expenses, including attorneys’ and accountants’

award appointing a rehabilitative receiver for the Company under the deadlock situation provisions of Section 11.404(a)(1)(B) of

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Upon the completion

of the receiver’s

primary function of collecting damages due to the Company, the receivership shall terminate and the restrictions on the rights of the

shareholders of the Company imposed by the Award shall be lifted.

of the receiver’s primary function of collecting damages due to the Company, the receivership shall terminate and the restrictions

on the rights of the shareholders of the Company imposed by the Award shall be lifted.

INCORPORATED AND SUBSIDIARY

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in thousands, except per share data)

parties to the Arbitration had until September 19, 2022 to submit their requests related to the Supplemental Award to be filed by the

Arbitrator relating to the assignment of a Receiver.

An extension was granted until October 6, 2022 at which point all parties submitted

their requests to the Arbitrator.

The parties now have until November 23, 2022 to respond to the submissions received by the Arbitrator

on October 6, 2022.

The Company does not have a definitive date by which it will receive the supplemental award identified in the Arbitration

Award dated August 31, 2022, but hopes it will be received before the end of the year.

parties submitted material for clarification of the Award on March 7, 2023, and March 20, 2023, which included proposed language for

an award to be entered against Vivos Real Estate Holdings, LLC (“VREH”), in light of the bankruptcy court order lifting the

stay that pertains to VREH, which filed a petition in bankruptcy court.

The date of a final award has not yet been determined.

through counsel, has reached out to the Arbitrator to inquire about when a final award may be expected.

a final resolution as to the underlying ownership and rights of certain shareholders, the Company intends to hold an annual meeting of

shareholders within a reasonable time thereafter.

of March 31, 2023, the Vivos Debtor (“Vivos Debtor”) balance was $ 5,327 .

The arbitration award covering all bulleted items

above currently totals $ 9,585 , independent of legal fees, interest, and other fees.

of presentation

unaudited consolidated interim financial statements include the accounts of the Company and all wholly owned divisions, including its

100 % owned subsidiary, MMG.

unaudited condensed consolidated interim financial statements include the accounts of the Company and all wholly owned divisions, including

its 100 % owned subsidiary, MMG.

All significant intercompany accounts and transactions have been eliminated in consolidation.

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a fair presentation of financial position and the results of operations for the periods presented have been reflected herein.

of operations for the periods presented are not necessarily indicative of the results to be expected for the full year.

of operations for the periods presented herein are not necessarily indicative of the results to be expected for the full year.

further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s annual report

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of Credit Risk

the nine months ended September 30, 2022, 20.3 %

of revenue came from Goldman Sachs, 13.5 %

from AT&T Services Inc (“AT&T”), and 12.2 %

from Janssen Pharmaceuticals (which includes workforce partner Johnson & Johnson) and 10.8 %

from DirecTV.

the three months ended March 31, 2023, 25.2 % of revenue came from one customer, and 12.6 % from a second customer.

Combined, this totals

AT&T, Goldman Sachs, Janssen, Morgan Stanley and DirectTV accounted for 18.1 % ,

respectively, 67.1 %

in aggregate revenue for the same period ended September 30, 2021.

other client has exceeded 10% of revenues in 2022 or 2021.

LIQUIDITY AND GOING CONCERN

considers on a regular basis, the Company’s ability to continue as a going concern.

The factors which have impacted the business

and our liquidity are:

of the timing or form of recovery of the of the arbitration award., with some of the award being collected in in the form of shares

losses in ten of the last eleven quarters starting with the first quarter of 2020 through the third quarter of 2022 ending September

30, 2022, totaling in aggregate $ 2,131

slow-moving rebound of client demand for our services to pre-pandemic levels;

in raising cash via public markets for organic and inorganic growth, due to lack of unissued authorized shares available for Company

and Contingencies, described further in Note 6.

these conditions noted and factored above, and if the $ 5,157

in notes receivable is not realized in full, part, or all, create substantial doubt about the Company’s ability to continue

as a going concern.

37.8 % of revenue.

Last year these two companies plus a third, accounted for 46.7 % of revenue for the same period ended March 31, 2022.

No other client has exceeded 10% of revenues for the three months ended March 31, 2023, or 2022.

MANAGEMENT’S PLAN

the Company continues to experience net operating losses, management believes it has the ability to continue as a going concern and meet

its financial obligation as they become due in 2023 and beyond.

The factors impacting this view include, but are not limited to, the

flow forecasts showing sufficient cash and working capital 52 weeks from April 23, 2023;

prospect of receiving the amounts awarded in the arbitration hearing in 2023, which include

the $ 5,327 in notes receivable from related parties, plus awards for fraud totaling $ 4,327 ,

contract damages of $ 1,000 , and additional interest, and legal fees, after the receiver is

anticipated reduction in legal fees;

of a new Vice President of Sales recently hired with experience and success in managing contingent

and direct hire staffing organizations;

Company has additional availability to use its factoring line to extend borrowings of up

to 93 % of unfactored invoices which as of May 1, 2023, was $ 2,041 .

INCORPORATED AND SUBSIDIARY

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in thousands, except per share data)

Additionally,

from an operational view the underlying business has yet to fully recover from COVID-19 with current quarterly comparative revenue levels

down 36% from 2019 standards .

there can be no assurances that the Company will be successful in managing the impact of the foregoing or its ability to maintain sufficient

liquidity over a period of time that will allow it to continue as a going concern.

The accompanying consolidated financial statements

do not include any adjustments that might result from the outcome from these uncertainties.

Company is quoted on the OTC Marketplace under the symbol “RLBY.”

ACCOUNTS RECEIVABLE

receivable are broken down as follows

SCHEDULE OF ACCOUNTS RECEIVABLE

September 30, 2022

December 31, 2021

Accounts Receivable

Trade receivables

Unbilled receivables

Less allowance for doubtful accounts

Total trade accounts receivable

a result of the foregoing, the Company believes that it has sufficient cash to meet its financial obligations for the next 12 months

and beyond as they become due.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Accounting Pronouncements

January 2017, the FASB issued ASU No.

2017-04, Intangibles—Goodwill and Other (Topic 350):

Simplifying the Test for Goodwill

Impairment , to simplify the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test.

no longer will determine goodwill impairment by calculating the implied fair value of goodwill by assigning the fair value of a reporting

unit to all of its assets and liabilities as if the reporting unit had been acquired in a business combination.

Instead, under the amendments

in this update, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting

unit with its carrying amount.

The FASB also eliminated the requirements for any reporting unit with a zero or negative carrying amount

to perform a qualitative assessment and, if it fails that qualitative test, to perform Step 2 of the goodwill impairment test.

The amendments

in this update will be effective for the Company beginning with fiscal year 2023, with early adoption permitted.

The Company adopted

this during 2021 resulting in an impairment charge as stated in the financial statements.

Company does not believe any other recently issued but not yet effective accounting pronouncement, if adopted, would have a material

effect on its present or future consolidated financial statements.

MMG was initially acquired by Vivos Holdings, LLC in 2016, the Company’s corporate status was changed from an S Corp to

a C Corp due to its new ownership structure.

This triggered an accelerated tax event, a $ 215 estimated annual impact per year for 4 years

which was accounted for in subsequent tax returns through 2019.

In 2021, MMG completed settlement of the estimated $ 860 tax liability

caused by the Vivos Group in 2017, paying the final estimated portion of $ 300 in 2021.

of September 30, 2022, the Company no longer has a federal tax liability related to tax periods prior to 2020.

ACCOUNTS RECEIVABLE

receivable can be broken down as follows:

SCHEDULE OF ACCOUNTS RECEIVABLE

Accounts receivable, Unfactored

Unbilled receivables

Accounts receivable, factored

Total Accounts Receivable

of March 31, 2023, the Company’s overall tax liability was $ 5 compared to $ 688 at end of same period in 2022 and $ 6 as of December

Company is in a factoring and security agreement with Gulf Coast Bank and Trust (“Gulf”)

which enables the Company to receive advances on its accounts receivable (i.e., invoices) through Gulf to fund growth and operations.

The proceeds of this agreement are most frequently used to pay operating costs of the business which include employee salaries, vendor

payments and overhead expenses.

arrangement calls for interest at prime plus 2 % and includes an advance rate of 18 basis points.

The amount of an invoice eligible for

sale to Gulf is 93%.

This agreement is month to month.

The Company continues to be obligated to meet certain financial covenants in respect

to invoicing and reserve account balance.

INCORPORATED AND SUBSIDIARY

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in thousands, except per share data)

Coast Bank and Trust

August 24, 2022, we were notified by our factoring company Triumph Business Capital (“TBC”) that our factoring arrangement had been sold

to Gulf Coast Bank and Trust (“Gulf”), as TBC had decided to sell its non-transportation portfolio.

The transition took place between August

26 th and 28 th with new financing coming from Gulf.

However, until all open accounts receivable (“A/R”) managed by

TBC is collected, a portion of those funds plus non factored receivables continue to come to MMG from TBC.

The Company continues to be

obligated to meet certain financial covenants in respect to invoicing and reserve account balance.

accordance with the agreement, a reserve amount is required for the total unpaid balance of all purchased accounts multiplied by a percentage

equal to the difference between one hundred percent and the advanced rate percentage.

As of September 30, 2022, the required amount was

Any excess of the reserve amount is paid to the Company on a weekly basis, as requested.

If a reserve shortfall exists for a period

of ten days, the Company is required to make payment to the financial institution for the shortage.

As of May 1, 2023, the required amount was 10 % .

Any excess of the reserve amount is paid to the Company as requested.

If a reserve shortfall exists for a period of ten days, the Company

is required to make payment to Gulf for the shortage.

receivables were sold with full recourse.

Proceeds from the sale of receivables were $ 3,429 for the three-month period ending September

30, 2022, compared to $ 1,756 for the same period ending on September 30, 2021, and $ 10,388 compared to $ 2,453 for the nine months ended

September 30, 2022 and 2021, respectively.

The total outstanding balance under the recourse contract was $ 2,014 on September 30, 2022,

compared to $ 946 as of December 31, 2021.

Proceeds from the sale of receivables were $ 2,971 for the three-month period ending March 31,

2023, compared to $ 2,811 for the same period ending on March 31, 2022.

The total outstanding balance under the recourse contract was

$ 924 on March 31, 2023, compared to $ 2,619 as of December 31, 2022, and $ 1,590 on March 31, 2022.

Factoring facility is collateralized by substantially all the assets of the Company.

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that the Company repurchase the receivable or debit the reserve account.

Total finance line fees for the three months ended September

30, 2022, and 2021 totaled $ 46 and $ 15 , respectively, and $ 111 and $ 78 for the nine months ended September 30, 2022, and 2021, respectively.

Total finance line fees for the three months ended March 31,

2023, and 2022 totaled $ 44 and $ 29 , respectively.

COMMITMENTS AND CONTINGENCIES

are a number of debts and confessions of judgement (“COJ”) related to the Vivos Group that included MMG as a co-signer or

guarantor at some stage in the Vivos Group debt process from November 2016 through October 29, 2019 when Vivos Holdings, LLC owned Maslow.

December 2019, the Company’s executive management learned that prior to the Merger, in January 2018, one of the

Company’s related parties, on behalf of MMG, executed a guarantee of obligations of Vivos Real Estate Holdings, LLC

(“VREH”), under a mortgage loan for the purchase of the property at 22 Baltimore Rd., Rockville, Maryland.

this space on market terms through April 30, 2020.

This obligation had not been disclosed by the Vivos Group to Reliability prior to

the Merger and consequently not included in MMG’s financial statements.

March 3, 2022, MMG received a notice of default, acceleration, and demand for payment in full, from FVCBank due to incurable events of

default on behalf of Borrower, Vivos Real Estate Holdings, LLC.

Per the default notice, “[a]s of March 2, 2022, the total indebtedness

due and owing under the Loan (the ‘‘Debt’’) is $ 1,743 consisting of an unpaid principal balance in the amount

of $ 1,703 accrued and unpaid interest in the amount of $ 7 , deferred payments in the amount of $ 20 and late fees in the amount of $ 12

plus prepayment penalties and attorneys’ fees, costs and expenses,” less setoff fees of $ 16 .

MMG believes it has grounds

to contest it being a guarantor on the loan.

July 12, 2022, MMG was advised that a foreclosure sale of the 22 Baltimore Road property was scheduled to take place on Thursday August

are a number of debts and confessions of judgement (“COJ”) related to the Vivos Group that included Maslow as a co-signer

or guarantor at some stage in the Vivos Group debt process from November 2016 through October 29, 2019, when Vivos Holdings LLC owned

All known debts disclosed to Maslow management and Reliability prior to the Merger were addressed by various safeguards such

as the Liquidation Agreement, and the Naveen Doki personal guarantee described in Item 1.

However, there were certain non-disclosures

by Vivos Holdings, LLC that are included below which are completely covered in Note 8 and Item 3 Legal Proceedings.

December 2019, the Company’s executive management learned that prior to the Merger, in January 2018, one of the Company’s

related parties, on behalf of Maslow, executed a guarantee of obligations of Vivos Real Estate Holdings, LLC (“VREH”), under

a mortgage loan for the purchase of the property at 22 Baltimore Rd., Rockville, Maryland.

Maslow leased this space on market terms.

This obligation had not been included in Maslow’s consolidated financial statements and was not separately disclosed prior to the

March 3, 2022, Maslow received a notice of default, acceleration, and demand for payment-in-full from FVCBank due to incurable events

of default on behalf of Borrower, VREH.

Per the default notice, “As of March 2, 2022, the total indebtedness due and owing under

the Loan (the ‘‘Debt’’) is $ 1,743 consisting of an unpaid principal balance in the amount of $ 1,703 accrued and

unpaid interest in the amount of $ 7 , deferred payments in the amount of $ 20 and late fees in the amount of $ 12 plus prepayment penalties

and attorneys’ fees, costs and expenses,” less setoff fees of $ 16 .

Maslow may have grounds to contest it being a guarantor

July 12, 2022, MMG was advised that a foreclosure sale of the 22 Baltimore Road property was scheduled to take place on August 4, 2022,

at Montgomery County Circuit Court in Rockville, Maryland.

It was subsequently cancelled after VREH filed for bankruptcy on

August 2, 2022.

It was subsequently cancelled after VREH filed for bankruptcy on August 2,

August 2, 2022, VREH filed for Chapter 11 bankruptcy in the District Court of Maryland.

filed a Motion to Vacate Confessed Judgment entered against it by FVC Bank in the Circuit Court for Fairfax County.

November 17, 2022, FVC Bank and VREH entered into a Stipulation and Consent Order through the bankruptcy court that provides VREH to

pay back taxes and interest, hire a new property manager and make repairs to the building, and work on a plan to refinance or sell the

This automatic stay to the bankruptcy proceeding provides VREH until April 15 th , 2023, to either refinance or sell

the building to prevent FVC Bank from foreclosing on the property and commencing action to sell the property.

INCORPORATED AND SUBSIDIARY

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in thousands, except per share data)

has filed a Motion to Vacate Confessed Judgment entered against it by FVC Bank in the Circuit Court for Fairfax County.

A hearing date

is set for December 9, 2022.

October 20, 2022, FVC bank filed a Motion to Dismiss Chapter 11 Case for Cause with respect to this pending proceeding filed by VREH.

A hearing date is set for November 16, 2022.

November 2, 2022, Maslow filed a “Response” to the Bank’s Motion to Dismiss, which in essence is a separate Motion for

court to dismiss VREH’s Chapter 11 protection filing.

October 2022, MMG learned that Vivos IT, LLC filed a lawsuit against Second Wind Consultants (“SWC”) in May 2019

included MMG as a plaintiff.

April 2023, VREH and FVC Bank negotiated through the bankruptcy court a revised Stipulation and Consent Order.

VREH has so far met the

requirements of the new order which included paying down the liability owed to FVC Bank by $ 350,000 .

VREH is working towards obtaining

a commitment letter from a lender so that one of their affiliated entities can purchase the building by June 1 st , 2023.

Company continues to dispute its placement as a guarantor on the mortgage associated with FVC Bank and is working to mitigate any liability

associated with VREH’s default on the mortgage.

September 2022, MMG learned that Vivos IT, LLC filed a lawsuit against Second Wind Consultants (“SWC”) in May 2019 included

MMG as a plaintiff.

The lawsuit included claims of fraud in inducement and unjust enrichment against SWC.

The Five parties suing SWC, included Vivos LLC, The Maslow Media Group, Suresh Venkat Doki, Naveen

Doki and Silvija Valleru.

The lawsuit related to a debt restructuring services agreement secured by Suresh Doki, Naveen Doki and

Silvija Valleru to assist the following then owned Vivos entities:

Maslow Media Group, Inc., Health Care Resources Network, Inc.,

Mettler & Michael, Inc., 360 IT Professionals, Inc.

and US IT Solutions, Inc.

Second Wind countersued all plaintiffs on

September 30th, 2019, seeking to collect the balance of $ 402,500

not paid by the Vivos Group.

The five parties suing SWC,

included Vivos LLC, The Maslow Media Group, Suresh Venkat Doki, Naveen Doki and Silvija Valleru.

The lawsuit related to a debt restructuring

services agreement secured by Suresh Doki, Naveen Doki and Silvija Valleru to assist the following then owned Vivos entities:

Media Group, Inc., Health Care Resources Network, Inc., Mettler & Michael, Inc., 360 IT Professionals, Inc.

and US IT Solutions,

SWC countersued all plaintiffs on September 30th, 2019, seeking to collect the balance of $ 402,500 not paid by the Vivos Group.

These suits were not disclosed to Maslow management or to Reliability before the Merger closed on October 29, 2019.

MMG is weighing its legal options at this time.

MMG is weighing its

legal options at this time.

The Company filed a motion in January 2023 to include all original parties to the SWC Agreement.

has not yet issued its ruling on the motion filed.

the present time, the Company is uncertain as to whether any of the above items will have a material impact on their consolidated financial

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RELATED PARTY TRANSACTIONS

Purchase Agreement

November 9, 2016, Vivos Holdings, LLC, the former owner of MMG, acquired 100 % of MMG through a stock acquisition exchange for a purchase

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These payments

were paid by the MMG on behalf of the Vivos Debtors.

The Vivos Debtors subsequently entered into a promissory note receivable with MMG,

described below, for the full stock purchase price.

No payment has ever been made against this note and between 2018 to present, there

has been $ 2,503 in additional borrowings.

of September 30, 2022, and December 31, 2021, the receivable totaled $ 5,157

and $ 4,985 , respectively.

This is not inclusive of the additional amounts awarded in the arbitration.

Settlement Agreements

July 21, 2021, MMG settled the obligation which Vivos Holdings, LLC had obligated MMG to in July 2018, with Libertas Funding, LLC and

Kinetic for $ 475 .

March 6, 2022, MMG received a notice of default, acceleration, and demand for payment-in-full from FVC Bank due to incurable events of

default on behalf of Borrower Vivos Real Estate Holdings, LLC.

has filed a Motion to Vacate Confessed Judgment entered against it by FVC Bank in the Circuit Court for Fairfax County and has requested

that the matter be heard before the end of 2022.

October 20, 2022, FVC bank filed a Motion to Dismiss Chapter 11 Case for Cause with respect to this pending proceeding filed by VREH.

A hearing date is set for November 16, 2022.

November 2, 2022, Maslow filed a “Response” to the Bank’s Motion to Dismiss, which in essence is a separate Motion for

court to dismiss VREH’s Chapter 11 protection filing.

were paid by MMG on behalf of the Vivos Debtors.

The Vivos Debtors subsequently entered into a promissory note receivable with MMG, described

below, for the full stock purchase price.

No payment has ever been made against this note and between 2018 to present, there has been

$ 2,503 in additional borrowings.

of March 31, 2023, and December 31, 2022, the receivable totaled $ 5,327 and $ 5,251 , respectively.

This is not inclusive of the additional

amounts awarded in the arbitration.

Company has notes receivable from Vivos Holdings, LLC and VREH, a member of Vivos Group, both related party affiliates due to their ownership

percentage in the Company.

Per Code of Virginia the legal rate of interest shall be implied when there is an obligation to pay interest

and no express contract to pay interest at a specified rate.

However, it was determined in 2021 that the two notes had clauses capping

the default interest at 4.5 % and 5.5 % respectively.

The rate adjustment for the allowed periods was made using the eligible agreement

INCORPORATED AND SUBSIDIARY

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in thousands, except per share data)

connection with the Vivos/MMG Purchase Agreement, on November 15, 2016, MMG executed a promissory note receivable with Vivos Holdings

LLC in the amount of $ 1,400 .

As defined by the Vivos/MMG Purchase Agreement, the loan consisted of two periods, whereby in the first

period no principal or interest payments were required.

During the second loan period, interest was supposed to have been paid in 20

equal consecutive payments, quarterly.

Principal plus any unpaid interest is due September 20, 2023 .

As of December 31, 2022, the total

outstanding balance was $ 3,585 which includes accrued interest receivable of $ 168 .

November 15, 2017, MMG executed an intercompany promissory note receivable with VREH in the amount of $ 772 .

There were two loan periods

During the first loan period, interest accrued monthly and a new loan amount of $ 781 was subject to a second loan period.

of March 31, 2023, the total outstanding balance was $ 868 which includes accrued interest receivable of $ 14 for the period ending March

June 12, 2019, MMG entered into a Personal Guaranty agreement with Dr.

Doki, pursuant to which Dr.

Naveen Doki personally guaranteed

to MMG repayment of $ 3,000 of the balance of the Promissory Note issued to Vivos Debtors on November 15, 2017, within the 2019 calendar

year via cash, stock, or other business assets acceptable to the Company.

Doki is a 5 % or greater beneficial holder of Company Common

Stock, and therefore is a related party.

of February 2020, the Company filed a lawsuit against the majority shareholder, pursuant to the personal guaranty agreement for defaulting

on the outstanding notes receivable.

the period between November 2016 and March 31, 2023, the Vivos Group borrowed an additional $ 2,547 .

which is included in the note receivable

totaling $ 3,643 .

September 5, 2019, MMG entered into a Secured Promissory Note agreement with Vivos, pursuant to which MMG issued a secured promissory

note to the Vivos Group in the principal amount of $ 750 .

The note bears interest at 2.5 % per year and requires the Vivos Group to make

monthly payments to MMG of $ 10 beginning December 1, 2019, with balance due and payable on November 1, 2026 .

Upon an event of default

has occurred, MMG has the right to declare the entire unpaid balance of the note due and payable.

The note was secured by 30,000,000

shares of Company Common Stock, was due and payable upon a default by Vivos.

In addition, both Naveen Doki and Silvija Valleru personally

guaranteed the repayment of the note by the Vivos Group.

Naveen Doki and Silvija Valleru were beneficial owners of Vivos and are also

5 % or greater beneficial owners of Company Common Stock, which is qualified by the Merger Arbitration complaint.

As of March 31, 2023,

the total outstanding balance was $ 869 , which includes 2023 interest of $ 12 .

Settlement Agreements

July 21, 2022, Maslow settled the obligation which Vivos Holdings, LLC had obligated Maslow to in July 2018, with Libertas Funding, LLC

and Kinetic for $ 475 .

(See Section 1A).

The $ 475 is included in the additional borrowing cited above.

Party Relationships

October 29, 2019, prior to the Merger, pursuant to the Merger Agreement, Dr.

Doki and Silvija Valleru became beneficial owners of 206,606,528

and 51,652,908 shares of RLBY common stock, respectively, equal to 68.9 % and 17.2 % of the total number of shares of RLBY common stock

outstanding after giving effect to the Merger, respectively.

The Company is seeking damages, which, if granted, will likely be the remedy

set forth within the Merger Agreement which is primarily the relinquishment in whole or in part shares of Company common stock received

by the Respondents in connection with the Merger.

October 29, 2019, prior to the Merger, pursuant to the Merger Agreement, Naveen Doki and Silvija Valleru became beneficial owners of

206,606,528 and 51,652,908 shares of RLBY Common Stock, respectively, equal to 68.9 % and 17.2 % of the total number of shares of RLBY

Common Stock outstanding after giving effect to the Merger, respectively.

The Company’s arbitration award thus far includes relinquishment

of shares of the Company common stock equal in value to $ 1,000 , valued as of the date of the Award, in accordance with the provisions

of Section 9.06(d) of the Merger Agreement (see Note 1).

INCORPORATED AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

in thousands, except per share data)

2019, the Company entered into transactions with two executive officers, Nick Tsahalis and Mark Speck, of the Company, resulting in the

issuance of warrants to purchase 163,232 shares each of common stock.

term “warrant” herein refers to warrants issued by MMG and assumed by the Company as a result of the Merger.

The term “warrant” herein refers to warrants issued by MMG and assumed by the Company as a result of the Merger.

all Warrants are the same other than as to the number of shares covered thereby.

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adjustments being made for any splits, combinations or dividends relating to the Company common stock, or combinations, recapitalization,

reclassifications, extraordinary distributions and similar events, that occur following one transaction constituting a part of the Qualified

Financing and prior to one or more other transactions constituting a part of the Qualified Financing (the “Exercise Price”).

The warrants were not valued and included as liability on balance sheet because of uncertainty around their pricing, value and low probability

at this juncture in receiving the $ 5,000 trigger.

September 7, 2021, the Company entered in Arbitration and Tolling Agreements with alleged shareholder Dr.

Doki, and his affiliates and

all other persons who were parties to the pending litigation previously reported in the Texas, New York and Maryland courts and before

the American Arbitration Association.

August 31, 2022, the Arbitrator issued an award (the “Award”) with the Company with MMG prevailing on their claims.

Note 1) for more details.

parties to the Arbitration had until September 19, 2022, to submit their requests related to the Supplemental Award to be filed by the

Arbitrator relating to the assignment of a Receiver.

An extension was granted until October 6, 2022, at which point all parties submitted

their requests to the Arbitrator.

The parties now have until November 23, 2022, to respond to the submissions received by the Arbitrator

on October 6, 2022.

The Company does not have a definitive date by which it will receive the supplemental award identified in the Arbitration

Award dated August 31, 2022, but hopes it will be received before the end of the year.

reclassifications, extraordinary distributions and similar events, that occur following

transaction constituting a part of the Qualified Financing and prior to one or more other transactions constituting a part of the Qualified

Financing (the “Exercise Price”).

Convertible note warrants were not valued and included as liability on balance sheet because

of uncertainty around their pricing, value and low probability at this juncture in receiving the $ 5,000 trigger.

BUSINESS SEGMENTS

Company operates within four industry segments:

EOR, Recruiting and Staffing, Direct Placements, and Video Production.

Company operates within four

industry segments:

EOR, Recruiting and Staffing, Direct Hire, and Video Production.

The EOR segment

provides freelance talent to a host of large corporate customers in all 50 states.

The Recruiting and Staffing segment provides skilled

media and IT field talent on a nationwide basis for customers in a myriad of industries.

Direct Placements was added as a segment in

the second quarter 2021 as the Company began to take on clients who desired the Company source candidates for direct hire needs on a

regular basis.

The Video and Multimedia Production segment provides crewing and Script to Screen services for corporate, government,

and non-profit clients, globally.

INCORPORATED AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

in thousands, except per share data)

following tables provides a reconciliation of revenue by reportable segment to consolidated results for the three and nine months ended

September 30, 2022, and 2021, respectively:

the three months ended September 30:

SCHEDULE OF RECONCILIATION OF REVENUE AND

OPERATING INCOME BY REPORTABLE SEGMENT TO CONSOLIDATED RESULTS

Recruiting and Staffing

Direct Placement

Video and Multimedia Production

the nine months ended September 30:

provides media field talent to a host of large corporate customers in all 50 states.

The Recruiting and Staffing segment provides

skilled Media and IT field talent on a nationwide basis for customers in a myriad of industries.

Direct Hire fulfils direct

placement requests by MMG clients for a wide variety of posts, including administrative, media and IT professionals.

The Video and

Multimedia Production segment provides Script to Screen services for corporate, government and non-profit clients,

following table provides a reconciliation of revenue by reportable segment to consolidated results for the three months ended March 31,

2023, and 2022, respectively:

the three months ended March 31:

SCHEDULE OF RECONCILIATION OF REVENUE AND OPERATING INCOME BY REPORTABLE SEGMENT TO CONSOLIDATED RESULTS

Recruiting and Staffing

Direct Placement

Video and Multimedia Production

SUBSEQUENT EVENTS

Company has evaluated subsequent events through November 15, 2022, the date on which the unaudited consolidated financial statements were

available to be issued.

Based upon this evaluation, management has determined that no material subsequent events have occurred that would

require recognition in or disclosures in the accompanying unaudited condensed consolidated financial statements, except as follows:

has filed a Motion to Vacate Confessed Judgment entered against it by FVC Bank in the Circuit Court for Fairfax County.

A hearing has

been scheduled for December 9, 2022.

October 20, 2022, FVC bank filed a Motion to Dismiss Chapter 11 Case for Cause with respect to this pending proceeding filed by Vivos

Real Estate Holdings, LLC (VREH).

A hearing date is set for November 16, 2022.

November 2, 2022, Maslow filed a “Response” to the Bank’s Motion to Dismiss, which in essence is a separate Motion for

court to dismiss VREH’s Chapter 11 protection filing.

Company has evaluated subsequent events through May 10, 2023, the date on which the unaudited condensed consolidated financial statements

were available to be issued.

Based upon this evaluation, management has determined that no material subsequent events have occurred that

would require recognition in or disclosures in the accompanying unaudited condensed consolidated financial statements, except as follows:

April 29, 2023, the Company received a check from the IRS for $ 1,203 covering its second quarter ERC claim which at the end of March

31, 2023, was posted as receivable (Item 1) for $ 1,226 including accrued interest.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements