RELIABILITY INC 10-K

ITEM 1A. RISK FACTORS There are numerous and varied risks that may prevent us from achieving our goals, including those described below. You should carefully consider the risks described below and the other information included in this Annual Report on Form 10-K, including our consolidated financial statements and related notes. Our business, financial condition, and our results of operations could be harmed by any of the following risks. If any of the events or circumstances described below were to occur, our business, the financial condition and the results of operations could be materially adversely affected. As a result, the trading price of Company Common Stock could decline, and investors could lose part or all of their investment. The risks below are not the only risks we face. Additional risks not currently known to us or that we currently deem to be immaterial may also adversely affect our business, financial condition, or results of operations. 10 An investment in our Common Stock should be considered high risk . An investment in RLBY should be considered high risk and requires a long-term commitment, with no certainty of return. We face risks related to health pandemics, wars, inflation, and other widespread outbreaks of contagious disease, including COVID-19 and its variants, or other potential causes of global instability which could significantly disrupt our operations and impact our financial results. The demand for staffing services has been and will be significantly affected by general economic conditions. The trend of companies allowing remote workers has negatively impacted the media staffing business because some companies have elected not to bring back the worker count it had pre-pandemic. Also, pandemic related vaccine mandates maintained by some clients have on occasion had an adverse impact on our business when associates have elected not to comply. In some cases, we are able to backfill the post and in some we may not have the opportunity. When we are able to backfill, there are still gaps in the period of revenue generation until a selection is made and a start date is determined. The extent to which the coronavirus impacts our results will depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning new strains of the virus, the severity of the coronavirus, rollout of vaccines, and federal, state and local government and client actions to contain the coronavirus or treat its impact, among others. Our executive management team continues to track COVID-19 news and developments, including the deployment of vaccines. RISKS RELATED TO OUR COMPANY Disputes between Reliability and the Vivos Group put our growth plans on hold as Reliability cannot tap the public markets for capital. Approximately 84.4% of Common Stock is owned by two groups of related parties (“Vivos Group”), set forth below, however their ownership has been the subject of an arbitration. Name Directly Owned Shares of Common Stock Percentage Beneficial ownership of Common Stock Percentage Naveen Doki 10,138,882 3.4 % 202,634,728 67.5 % Silvija Valleru 4,972,644 1.7 % 50,657,482 16.9 % Shirisha Janumpally 192,495,846 64.2 % 202,634,728 67.5 % Kalyan Pathuri 45,684,838 15.2 % 50,657,482 16.9 % Totals 253,292,210 84.4 % Related Party Indebtedness; Default. Prior to the Merger, shareholders of Vivos (“Vivos Debtors”), directly and through affiliated entities, borrowed amounts from Maslow (the “Related Party Debt”) that reached an aggregate outstanding balance (including principal and interest) as of December 31, 2019 of approximately $4,169. The Related Party Debt is currently in default, and as of December 31, 2023, had a balance of $5,501. In August 2022, Maslow learned it had prevailed in arbitration against the Vivos Group. In May and October of 2023, the Company was afforded three supplemental awards. On January 29, 2024, the three arbitration awards entered as judgments in Reliability’s case against the Vivos Group became final giving Reliability collectible judgments which the appointed Receiver is now eligible to pursue. While the Company is optimistic that it will recover the amounts of the award, failure to recover the Related Party Debt could have a material adverse effect on the Company. 11 In addition, prior to the Merger, some of the Vivos Group incurred obligations at a number of other businesses they owned and caused Maslow to become obligated thereon as co-obligor or guarantor and pledged assets of Maslow to secure certain of these obligations. In 2021, Maslow paid approximately $450 in satisfaction of obligations incurred before the Merger. In September 2022, MMG learned that a Vivos IT, LLC lawsuit against Second Wind Consultants (“SWC”) in May 2019 included MMG as a plaintiff. The lawsuit brought claims of fraud in the inducement, unjust enrichment, and other monetary claims against SWC. The five parties suing SWC included Vivos IT, LLC, Maslow Media Group, Inc., 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. SWC countersued all plaintiffs on September 30, 2019, seeking to collect the balance of $403 not paid by the Vivos Group. This was not disclosed to Maslow management or to Reliability before the Merger, which closed on October 29, 2019. Maslow’s retained counsel filed a motion to include all original parties to the SWC agreement, and in March 2024, SWC petitioned the court for a summary judgment to which MMG filed opposition. The Company could be subject to unknown liabilities incurred by its previous sole shareholder, Vivos Holdings LLC . Maslow, subsequent to the Merger with Reliability, discovered that unbeknownst to them at the time of origination that it was guarantor or direct obligor for loans, advances, or other liabilities for the benefit of the Vivos Group and related entities. For example, we became aware of being a party to the SWC lawsuit in September 2022. There may be additional obligations of other Vivos Group entities for which Maslow may have liability as a result of these arrangements that are not known to the management of Maslow. These liabilities could have a material adverse effect on the Company and the value of the Common Stock. Reliability periodically runs lien checks to detect if there are any other new uncommunicated pre-existing liabilities on the record. The Arbitration outcome could lead to a new shareholder base where the new affiliated parties decide a different strategic direction for the Company and take appropriate action. If a new shareholder base is the outcome of the arbitration, a new shareholder base may decide to change the strategic direction of the Company in a significant way. This might include, but is not limited to, capitalization plans, whether the Company remains a public company, merger and acquisition plans, corporate structure, and executive management. The success of our business depends on our ability to attract and retain qualified employees that possess the skills demanded by clients and intense competition may limit the ability to attract and retain such qualified employees . For the Company’s staffing, executive recruiting, and video production services, the success of the Company depends on the ability to attract and retain qualified employees who possess the skills and experience necessary to meet the requirements of clients or to successfully bid for new client projects. The legal dispute with the Vivos Group has negatively impacted the Company’s ability to attract and retain some top talent. The level of uncertainty since the legal dispute began in late 2019 until the arbitration award issued in August 2022 provided reason for concern for existing and prospective staff in remaining or joining the Company. The ability to attract and retain qualified employees could be impaired by improvement in economic conditions resulting in lower unemployment, increases in compensation, or increased competition. During periods of economic growth, the Company faces increasing competition from other staffing companies for retaining and recruiting qualified temporary and permanent employees, which in turn leads to greater advertising and recruiting costs and increased salary expenses. These problems can be exacerbated by the fact that the Company often must attract and retain employees with skills specific to the video production industry, which narrows the pool of available, qualified employees that the Company may draw upon. If the Company cannot attract and retain qualified temporary and permanent employees, the quality of its services may deteriorate and the financial condition, business, and results of operations may be materially adversely affected. 12 Our success depends to a large degree on growth in market acceptance of human resources outsourcing and related services we provide . Because the majority of our revenues currently come from EOR services, a substantial portion of our success depends on the willingness of clients to outsource their contingent staffing requirements to a third-party service provider. Many companies have invested substantial personnel, infrastructure, and financial resources in their own internal HR organizations, and therefore, may be reluctant to switch to our solution. Companies may not engage us for other reasons, including a desire to maintain control over all aspects of their HR activities, a belief that they manage their HR activities more effectively using their internal administrative organizations, perceptions about the expenses associated with our services, perceptions about whether our services comply with laws and regulations applicable to them or their businesses, or other considerations that may not always be evident. We also lost some of our headcounts with existing clients who decided to convert placed resources to their payroll. This has had a modest impact on our business with a few clients. Additional concerns or considerations may also emerge in the future. We must address our potential clients’ concerns and explain the benefits of our approach in order to convince them to change the way that they manage their HR activities, particularly in parts of the United States where our Company and solution are less well-known. If we are not successful in addressing potential clients’ concerns and convincing companies that our solution can fulfil their HR needs, then the market for our solution may not develop as we anticipate, thus our business may not grow. Any significant or prolonged economic downturn could result in clients using fewer staffing and executive recruiting services offered by the Company, terminating their relationship with the Company, or becoming unable to pay for services on a timely basis or at all. Because demand for the types of services our Company offers is sensitive to changes in the level of economic activity, the Company’s business has in the past, and may in the future, suffer during economic downturns. Demand for the services we provide is highly correlated to changes in the level of economic activity and employment. Consequently, as economic activity begins to slow down, it has been the Company’s experience that companies tend to reduce their use of our services, resulting in decreased revenues and profit levels. In addition, the Company may experience pricing pressure during economic downturns, which could have a negative impact on the results of operations. Further, many of our clients are corporate media departments and broadcast networks. As a result, any industry downturn that affects these kinds of companies could have a major effect on our business. The deterioration of the financial condition and business prospects of clients could reduce their need for the staffing and executive recruiting services we provide and could result in a significant decrease in the Company’s revenues and earnings derived from these clients. In addition, during economic downturns, companies may slow down the rate at which they pay their vendors, seek more flexible payment terms, or become unable to pay their debts as they become due. In late 2022 and early 2023, some of our clients announced layoffs, which led to a reduced usage of our staff in 2023. Our two largest clients, however, increased their business as measured by revenue by 2% and 6%, respectively, in 2023 over 2022. State unemployment insurance expense is a direct cost of doing business in the staffing industry. State unemployment tax rates are established based on a company’s specific experience rate of unemployment claims and a state’s required funding formula on covered payroll. Economic downturns have in the past, and may in the future, result in a higher occurrence of unemployment claims resulting in higher state unemployment tax rates. This would result in higher direct costs to us. In addition, many states unemployment funds were depleted during the recent economic downturn and many states have borrowed from the federal government under the Title XII loan program. Employers in all states receive a credit against their federal unemployment tax liability if the employer’s federal unemployment tax payments are current and the applicable participating state is also current with its Title XII loan program. If a state fails to repay such loans within a specific time period, employers in such states may lose a portion of their tax credit. The Company is exposed to employment-related claims and costs, as well as periodic litigation that could materially adversely affect the Company’s financial condition, business, and results of operations . Our business often entails employing individuals and placing such individuals in our clients’ workplaces. The Company’s ability to control the workplace environment of clients is limited. As the employer of record of these employees, the Company incurs a risk of liability to its employees and clients for various workplace events, including: ● claims of misconduct or negligence on the part of employees; 13 ● discrimination or harassment claims against employees, or claims by employees of discrimination or harassment by clients or the Company; ● immigration-related claims; ● claims relating to violations of wage, hour, and other workplace regulations; ● claims related to wrongful termination or denial of employment; ● violation of employment rights related to employment screening or privacy issues; ● claims relating to employee benefits, entitlements to employee benefits, or errors in the calculation or administration of such benefits; and ● possible claims relating to misuse of clients’ confidential information, misappropriation of assets, or other similar claims. The Company may incur fines and other losses and negative publicity with respect to any of these situations. Some of the claims may result in litigation, which is expensive and distracts attention from the operation of ongoing business. The Company assumes the obligation to make wage, tax, and regulatory payments for our employees, and, as a result, is exposed to client credit risks. The Company generally assumes responsibility for and manages the risks associated with employees’ payroll obligations, including liability for payment of salaries, wages, and certain taxes. These obligations are fixed, whether clients make payments as required by service contracts with the Company, which exposes the Company to credit risks of clients. Workers’ compensation costs for employees may rise and reduce our margins and require more liquidity. The Company is responsible for, and pays, workers’ compensation costs for individuals employed by the Company – both regular staff and client employees for which the Company is the employer of record. At times, these costs have risen substantially as a result of increased claims and claim trends, general economic conditions, changes in business mix, increases in healthcare costs, and government regulations. Although the Company carries insurance, unexpected changes in claim trends, including the severity and frequency of claims, actuarial estimates, and medical cost inflation could result in costs that are significantly different than initially reported. If future claims-related liabilities increase due to unforeseen circumstances, or if new laws, rules, or regulations are passed, costs could increase significantly. There can be no assurance that the Company will be able to increase the fees charged to clients in a timely manner and in a sufficient amount to cover increased costs as a result of any changes in claims-related liabilities. We currently depend on two to four customers for a material portion of our net revenue. The loss of or a substantial reduction in business of one of these four customers would significantly reduce our net revenue and adversely impact our operating results. Revenue reliance in 2023 was concentrated on two clients compared to 2022 when it was four clients delivering 10% or more the revenue. The top two revenue producing clients in 2023, Clients C (25.1%) and D (15.1%), produced 40.3% of the revenue whereas in 2022, Clients C (19.6%), D (12.9%), A (12.0%), and B (14.4%) brought in 58.8% of the revenue. When comparing the top four irrespective of a 10% threshold, the four clients produced 57.7% in 2023 compared with the aforementioned 2022 total of 58.8%. In terms of accounts receivable balances on December 31, 2023, Client D had 42.2% compared to 21.7% for the same period 2022. Client C had 19.9% and Client A had 12.3%, respectively in 2023, compared to Client C’s 18.5% and Client A’s 13.7% of accounts receivable on December 31, 2022. Client B had the largest share of accounts receivable on December 31, 2022 with 33.7%. But on December 31, 2023, Client B had only a 3.6% share of the accounts receivable. Client B’s drop was because Client B was eligible for an early payment discount which was taken. The loss of or a substantial reduction in business from these four to five customers would have a significant negative impact on our business and our operating results. We may not be successful in finding a client or clients that could replace the level of loss of these customers, and as such, it could have a negative impact on our revenue and results of operations for a prolonged period. 14 Improper disclosure of employee and client data could result in liability and harm to the reputation of the Company. The business of the Company involves the use, storage, and transmission of information about employees and clients. It is possible that security controls over personal and other data and practices that the Company follows may not prevent the improper access to, or disclosure of, personally identifiable or otherwise confidential information. Our security controls may be inadequate, or hackers or other malicious groups or organizations may attempt to interfere with our data through different means, including but not limited to malware attacks, denial of service attacks, consensus-based attacks. Any event that results in a disclosure of our clients’ and employees’ data could harm the reputation of the Company and subject the Company to liability under contracts and the laws that protect personal data and confidential information, resulting in increased costs or loss of revenue. Further, data privacy is subject to frequently changing rules and regulations, which sometimes conflict among the various jurisdictions in which the Company provides services. The failure to adhere to or successfully implement processes in response to changing regulatory requirements in this area could result in legal liability or impairment to the reputation of the Company in the marketplace. The Company could face disruption and increased costs from outsourcing and offshoring various aspects of its business. The Company may outsource aspects of its business to lower cost of employment areas in the United States and potentially to places such as India. This outsourcing solution would focus predominantly on shared service activities which traditionally consist of back-office functions, such as “hire to retire,” “procure to pay,” and “order to cash” processes. Although a goal of outsourcing our operations is to reduce the operational costs of our business, it is possible that we will not realize any benefit from outsourcing such aspects of our business or even increase our overhead expenses. A transition may create the risk of errors and omissions or technical disruptions that could negatively impact our clients, and in turn, damage our reputation resulting in a loss of customers. The Company depends on its management team to manage its business effectively . The Company’s future success is largely dependent upon its ability to understand, develop, and execute the business plan and to attract and retain highly skilled management, operational, and executive personnel. Thus, the Company is highly dependent on its officers to provide the necessary skills, experience, and background to execute the Company’s business plan. Additionally, the employer of record business is a specialty service which requires a full understanding of the service and its merits to be able to educate clients and potential clients to win business and operate optimally. The loss of any officer’s services with this knowledge could stifle the Company’s growth for four to nine months, and could impede, particularly initially, the Company’s EOR business with existing clients, record and reputation with new clients, ability to develop and execute on its objectives, and as such, negatively impact the Company’s possible overall development. To mitigate this risk, on September 1, 2021, Reliability entered into new employment agreements with President/CEO, Nick Tsahalis, and CFO, Mark Speck, respectively. The board of directors acted in accordance with the advice of its compensation committee to grant new employment agreements to Mr. Tsahalis, who has served as wholly owned subsidiary Maslow Media Group’s CEO since November of 2016, and Mr. Speck, who has served MMG as CFO since April of 2019. Government regulation could negatively impact the business . The Company’s business is subject to various government regulations in the jurisdictions in which it operates. Currently, the Company has clients and places employees in all 50 U.S. states. Due to the wide scope of the Company’s operations, the Company could be subject to regulation by various political and regulatory entities, including various local and municipal agencies and government sub-divisions. The Company may incur increased costs necessary to comply with existing and newly adopted laws and regulations or penalties for any failure to comply. The Company’s operations could be adversely affected, directly or indirectly, by existing or future laws and regulations relating to its business or industry, such as the imposition of additional licensing or tax requirements. Failure to comply with the legal regulations in places we do business, or the regulatory prohibition or restriction of employment services, could lead to financial liability and regulatory action against the Company, which could significantly harm our development as a business. 15 The Company may face significant competition from companies that serve its industries . The Company may face competition from other companies that offer similar solutions. Some of these potential competitors may have longer operating histories, greater brand recognition, larger client bases, and significantly greater financial, technical, and marketing resources than the Company possesses. These advantages may enable such competitors to respond more quickly to new or emerging trends and changes in customer preferences. These advantages may also allow them to engage in more extensive market research and development, undertake extensive far-reaching marketing campaigns, adopt more aggressive pricing policies, and make more attractive offers to potential customers, employees, and strategic partners. Increased competition may result in price reductions, reduced gross margin, and loss of market share. The Company may not be able to compete successfully, and competitive pressures may adversely affect its business, results of operations, and financial condition. The staffing industry is highly competitive with low barriers to entry which could limit the Company’s ability to maintain or increase our market share or profitability. The staffing services industry is highly competitive with limited barriers to entry. Although we specialize in EOR and providing staffing services specifically for video production where the market is not yet saturated by competitors, we still face significant competition on a national, regional, and local scale with full-service and specialized temporary staffing companies. We expect that the level of competition will remain high, which could limit our ability to maintain or increase our market share or profitability. Several of our existing or potential competitors have substantially greater financial, technical, and marketing resources than we do, which may enable them to: ● Invest in innovative technologies; ● Be more competitive in cash and price paid for acquisitions; ● Devote greater resources to sales and marketing; ● Aggressively price products and services below market rates; and ● Offer better benefit packages that we may not be able to match. The Company is subject to the potential factors of market and customer changes, which could result in our inability to timely respond to the needs of our clients. The business of the Company is susceptible to rapidly changing preferences of the marketplace and its customers. The needs of customers are subject to constant change. Although the Company intends to continue to develop and improve its services to meet changing customer needs of the marketplace, there can be no assurance that funds for such expenditures will be available or that the Company’s competition will not develop similar or superior capabilities or that the Company will be successful in its internal efforts. The future success of the Company will depend in part on its ability to respond effectively to rapidly changing trends, industry standards, and customer requirements by adapting and improving the features and functions of its services. In the Company’s industry, failure by a business to adapt to the changing needs and demands of customers is likely to render the business obsolete. Negative publicity could adversely affect our business and operating results . Negative publicity about our industry or our Company, including the utility of our services, even if inaccurate, could adversely affect our reputation and confidence in and the use of our services, which could harm our business and operating results. Harm to our reputation can arise from many sources, including poor performance or misconduct by the workers we supply and recruit for our clients, misconduct by our partners, outsourced service providers, or other counterparties, and failure by us to meet minimum standards of service expected by clients in our industry. 16 The Company has generated revenues, but limited profits, to date . The business model of the Company involves significant costs of services, resulting in a lower gross and net margin on revenues than many staffing businesses derive. Coupling this fact with the required operating expenses incurred by the Company, the Company has only generated approximately $1,000 in operating income and net income from operations in any one year, with a high net income of approximately $500 since 2015. Net income for the Company specifically was $386 in 2018, $195 in 2019, and in 2020, with the Company taking on the added expense of being a public company, additional expenses of approximately $900 for management compensation, administrative costs, D&O insurance, consulting, and legal fees for reporting and regulatory compliance, had the most impact on our incurring a net loss of $789. In 2021, the Company earned a record $7,893 in net income, but $9,631 was achieved as Other Income based on eligibility for government programs. The Company hopes and expects that as its business expands, it will enjoy economies of scale resulting in higher operating and net margins and improved cash flows, but there is no guarantee this will occur. The Company may suffer from a lack of availability of additional funds . We have ongoing needs for working capital in order to fund operations, pay costs associated with being a public company, and to continue to expand our operations. To that end, we will be required to raise additional funds through equity or debt financing. However, there can be no assurance that we will be successful in securing additional capital on favorable terms, if at all. There is a potential that we will continue to lack shares of Company Common Stock available for equity financing. If additional debt is incurred, the Company may fail to comply with the terms of such financing, which could result in significant liabilities for our Company. If we are unsuccessful, we may need to (a) initiate cost reductions; (b) forego business development opportunities; (c) seek extensions of time to fund liabilities, or (d) seek protection from creditors. In addition, any future sale of our equity securities would dilute the ownership and control of your shares and could be at prices substantially below the prices at which our shares currently trade. Our inability to raise capital could require us to significantly curtail or terminate our operations. Our plan is to increase our cash reserves through the sale of additional equity or debt securities. The sale of convertible debt securities or additional equity securities could result in additional and potentially substantial dilution to our shareholders. The incurrence of indebtedness would result in increased debt service obligations and could result in operating and financing covenants that would restrict our operations and liquidity. In addition, our ability to obtain additional capital on acceptable terms is subject to a variety of uncertainties. In addition, if we are unable to generate adequate cash from operations, and if we are unable to find sources of funding, it may be necessary for us to sell all or a portion of our assets, enter into a business combination, or reduce or eliminate operations. These possibilities, to the extent available, may be in terms that result in significant dilution to our shareholders or that result in our shareholders losing all of their investment in our Company. Our acquisition strategy creates risks for our business . We expect that we will pursue acquisitions of other businesses, assets, or technologies to grow our business. We may fail to identify attractive acquisition candidates, or we may be unable to reach acceptable terms for future acquisitions. We might not be able to raise enough cash to compete for attractive acquisition targets. If we are unable to complete acquisitions in the future, our ability to grow our business at our anticipated rate will be impaired. 17 We may pay for acquisitions by issuing additional shares of Common Stock, if such shares become available, which would dilute our shareholders, or by issuing debt, which could include terms that restrict our ability to operate our business or pursue other opportunities and subject us to meaningful debt service obligations. We may also use significant amounts of cash to complete acquisitions. Most acquisitions will include “Earn Out” provisions which ensure adequate generation of revenue and profits, but cash required to pay Earn Outs likely will exceed that total or incremental cash flow generated by the acquired business. To the extent that we complete acquisitions in the future, we likely will incur future depreciation and amortization expenses associated with the acquired assets. We may also record significant amounts of intangible assets, including goodwill, which could become impaired in the future. Acquisitions involve numerous other risks, including: ● difficulties integrating the operations, technologies, services, and personnel of the acquired companies; ● challenges maintaining our internal standards, controls, procedures, and policies; ● diversion of management’s attention from other business concerns; ● over-valuation by us of acquired companies; ● litigation resulting from activities of the acquired company, including claims from terminated employees, customers, former shareholders, and other third parties; ● insufficient revenues to offset increased expenses associated with the acquisitions and unanticipated liabilities of the acquired companies; ● insufficient indemnification or security from the selling parties for legal liabilities that we may assume in connection with our acquisitions; ● entering markets in which we have no prior experience and may not succeed; ● risks associated with foreign acquisitions, such as communication and integration problems resulting from geographic dispersion and language and cultural differences, compliance with foreign laws and regulations, and general economic or political conditions in other countries or regions; ● potential loss of key employees of the acquired companies; and ● impairment of relationships with clients and employees of the acquired companies or our clients and employees as a result of the integration of acquired operations and new management personnel. The Company may suffer from a lack of liquidity . By incurring indebtedness, the Company may subject itself to increased debt service obligations, which could result in operating and financing covenants that would restrict our operations and liquidity. This would impair our ability to hire the necessary senior and support personnel required for our business, as well as carry out its acquisition strategy and other business objectives. The Company has only been able to secure asset-based lending at this time. The Company relies on its factoring relationship with Gulf Coast Bank which is based on accounts receivable balance. As of December 31, 2023, Maslow could raise an additional $2,624 in cash through factoring. In the past, Maslow has tried to tap non-asset-based lending but the market for such loans is challenging, and the Vivos Group’s association has prevented loans from proceeding in the past. Thus, at this time, Maslow is limited in borrowing based on the amount of unfactored accounts receivable that is available. The Company services numerous geographic areas, and therefore may be subject to risks such as natural disasters and travel-related disruptions, which may materially adversely affect our business, financial condition, and results of operations. We operate in all U.S. states and territories and in numerous countries around the world. To do so, we often send workers to locations that could be affected by a range of factors beyond our control that could adversely effect our ability to service our clients. These factors could also affect our employees, vendors, insurance carriers, and other contractual counterparties. Such factors include: ● war, terrorist activities, or threats, and heightened travel security measures instituted in response to these events; ● outbreaks of pandemic or contagious diseases or consumers’ concerns relating to potential exposure to contagious diseases; 18 ● natural disasters, such as hurricanes, fires, earthquakes, tsunamis, tornados, floods, and volcanic eruptions and human-caused disasters; ● dangerous weather and even forecasts of severe weather, including abnormally hot, cold, and/or wet weather; ● oil prices and travel costs and the financial condition of the airline, automotive, and other transportation-related industries, any travel-related disruptions or incidents and their impact on travel; and ● actions or statements by U.S. and foreign governmental officials related to travel and corporate travel-related activities (including changes to the U.S. visa rules) and the resulting public perception of such travel and activities. Any one or more of these factors could adversely affect our ability to offer services to clients, which could materially adversely affect our business, financial condition, and results of operations. A downturn of the U.S. or global economy could result in our clients using fewer workforce solutions or becoming unable to pay us for our services on a timely basis or at all, which would materially adversely impact our business. Because demand for workforce solutions and services, particularly staffing services, is sensitive to changes in the level of economic activity, our business may suffer during an economic downturn, which can be caused by such events as the COVID-19 pandemic. During periods of weak economic growth or economic contraction, the demand for staffing services typically declines. When demand drops, our operating profit is typically impacted unfavorably as we experience a deleveraging of our selling and administrative expense base as expenses may not decline as quickly as revenues. In periods of decline, we can only reduce selling and administrative expenses to a certain level without negatively impacting our long-term prospects. Additionally, during economic downturns companies may slow the rate at which they pay their vendors, or they may become unable to pay their obligations. If our clients become unable to pay amounts owed to us, or pay us more slowly, then our cash flow and profitability may suffer. A client’s use of our services may be terminated on short notice, leaving us vulnerable to a significant loss in revenue. Client staffing needs can change and, as a result, we could lose staffing or EOR headcount rather quickly. In early 2022, this was the case when Client A moved eight heads from our payroll to theirs and Client B’s loss of major sports program, which we staffed, to a competitor had approximately $1,800 impact to our revenues in 2023. In 2022, our client did not rebid on a government contract, and it was awarded to another party. The end customer required a minority or disadvantaged business to own the contract, a requirement that our Company does not meet. The result was a loss of approximately $130 in revenue in 2022 and $320 in 2023 revenue. A reduction in such needs and resulting loss of clients or placements at clients could result in a significant decrease in revenue within a short period of time that would be difficult to quickly replace. Inability to retain or attract new clients. The growth and profitability of our business is dependent upon our ability to retain and capture new clients. Our ability to achieve success in both areas is reliant in large part on our sales and service organization. If we are unable to execute effectively, or our selected business development efforts falter, we may not be able to attract a significant number of new clients and our existing client base could shrink, resulting in an adverse impact on our revenues and profitability. Concentration Risk of Customers Our business relies on relationships with several large customers to generate a large portion of our revenue. This revenue concentration in a relatively small number of customers makes us particularly dependent on factors affecting those companies. Workforce clients C, D, F, and A made up approximately 57.7% of our revenues in 2023. Whereas, in 2022, Workforce Clients C, D, B, and A, made up approximately 58.8% of our 2022 revenues. As of December 31, 2023, Clients D, C, and A account for approximately 74.4% of our accounts receivable compared to the 2022 group of four (Clients C, D, B, and A) which comprised 87.6% of our receivables as of December 31, 2022. 19 We face risks related to health pandemics, wars, inflation, and other widespread outbreaks of contagious disease, including COVID-19 and its variants, or other potential causes of global instability which could significantly disrupt our operations and impact our financial results. RISKS RELATED TO OWNERSHIP OF COMMON STOCK Our stock price may be volatile or may decline regardless of our operating performance, resulting in substantial losses for our shareholders . The market price of Common Stock has been, and will likely continue to be, volatile for the foreseeable future. The market price of Common Stock may fluctuate significantly in response to numerous factors, many of which are beyond our control, including the factors listed below: ● actual or anticipated fluctuations in our results of operations; ● any financial projections we provide to the public, any changes in these projections or our failure to meet these projections; ● lack of securities analyst coverage; ● effect of applicable “penny stock” rules and FINRA Rule 2111; ● failure of securities analysts to initiate or maintain coverage of our Company, changes in financial estimates by any securities analysts who follow our Company, or our failure to meet these estimates or the expectations of investors; ● ratings change by any securities analysts who follow our Company; ● announcements by us or our competitors of significant innovations, acquisitions, strategic partnerships, joint ventures, or capital commitments; ● changes in operating performance and stock market valuations of other business services companies generally, or those in our industry in particular; ● price and volume fluctuations in the overall stock market, including as a result of trends in the economy as a whole; ● changes in our board of directors or management; ● sales of large blocks of Common Stock, including sales by our executive officers, directors, and significant shareholders; ● lawsuits threatened or filed against us; ● short sales, hedging, and other derivative transactions involving our capital stock; ● general economic conditions in the United States and abroad; and ● other events or factors, including those resulting from war, incidents of terrorism, or responses to these events. In addition, stock markets have experienced extreme price and volume fluctuations that have affected and continue to affect the market prices of equity securities of many business services companies. Stock prices of many business services companies have fluctuated in a manner unrelated or disproportionate to the operating performance of those companies. In the past, shareholders have instituted securities class action litigation following periods of market volatility. If we were to become involved in securities litigation, it could subject us to substantial costs, divert resources and the attention of management from our business and adversely affect our business, results of operations, and financial condition. Common stock is subject to risks arising from restrictions on reliance on Rule 144 by shell companies or former shell companies. Under a regulation of the SEC known as “Rule 144,” a person who beneficially owns restricted securities of an issuer and who is not an affiliate of that issuer may sell them without registration under the Securities Act provided that certain conditions have been met. One of these conditions is that such person has held the restricted securities for a prescribed period, which is six months for common stock. However, Rule 144 is unavailable for the resale of securities issued by an issuer that is a shell company (other than a business combination related shell company) or, unless certain conditions are met, was, at any time, previously a shell company. 20 The SEC defines a shell company as a company that has (a) no or nominal operations and (b) either (i) no or nominal assets, (ii) assets consisting solely of cash and cash equivalents; or (iii) assets consisting of any amount of cash and cash equivalents and nominal other assets. As a result of the Merger described in Item 1.01, the Company ceased being a shell company as such term is defined in Rule 12b-2 under the Exchange Act. While we believe that as a result of the Merger, Reliability ceased to be a shell company, the SEC and others whose approval is required for shares to be sold under Rule 144 might take a different view. Rule 144 is available for the resale of securities of former shell companies if and for as long as the following conditions are met: (i) the issuer of the securities that was formerly a shell company has ceased to be a shell company; (ii) the issuer of the securities is subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act; (iii) the issuer of the securities has filed all Exchange Act reports and materials required to be filed, as applicable, during the preceding 12 months (or such shorter period that the issuer was required to file such reports and materials), other than Current Reports on Form 8-K; and (iv) at least one year has elapsed from the time that the issuer filed current comprehensive disclosure with the SEC reflecting its status as an entity that is not a shell company known as “Form 10 Information.” Although the Company filed Form 10 Information with the SEC on its Current Report on Form 8-K filed October 29, 2019, shareholders who receive the Company’s restricted securities will not be able to sell them pursuant to Rule 144 without registration until the Company has met the other conditions to this exception and then for only as long as the Company continues to meet the condition described in subparagraph (iii), above, and is not a shell company. No assurance can be given that the Company will meet these conditions or that, if it has met them, it will continue to do so, or that it will not again be a shell company. The issuance of the additional shares of Common Stock could cause the value of Common Stock to decline. The sale or issuance of a substantial number of shares of Common Stock, or anticipation of such sales, could make it more difficult for us to sell equity or equity-related securities in the future at a time and at a price that we might otherwise wish. Further, if we do sell or issue more Common Stock, any investors’ investment in the Company will be diluted. Moreover, the Company has outstanding warrants. The conversion or exercise of the warrants for shares of Company Common Stock would dilute the common shareholders. If significant dilution occurs, any investment in Common Stock could significantly decline in value. The application of the “penny stock” rules could adversely affect the market price of Common Stock and increase transaction costs to sell those shares. This can be exacerbated by the current low float of the stock in relation to the shares outstanding. The SEC adopted Rule 3a51-1, which establishes the definition of a “penny stock,” for the purposes relevant to us, as any equity security that has a market price of less than $5.00 per share or with an exercise price of less than $5.00 per share, subject to certain exceptions. For any transaction involving a penny stock, unless exempt, Rule 15g-9 requires: ● that a broker or dealer approve a person’s account for transactions in penny stocks and ● the broker or dealer receive from the investor a written agreement to the transaction, setting forth the identity and quantity of the penny stock to be purchased. 21 In order to approve a person’s account for transactions in penny stocks, the broker or dealer must: ● obtain financial information and investment experience objectives of the person and ● make a reasonable determination that the transactions in penny stocks are suitable for that person and the person has enough knowledge and experience in financial matters to be capable of evaluating the risks of transactions in penny stocks. The broker or dealer must also deliver, prior to any transaction in a penny stock, a disclosure schedule prescribed by the SEC relating to the penny stock market, which, in highlight form, sets forth the basis on which the broker or dealer made the suitability determination, and that the broker or dealer received a signed written agreement from the investor prior to the transaction. Generally, brokers may be less willing to execute transactions in securities subject to the “penny stock” rules. This may make it more difficult for investors to dispose of Common Stock and cause a decline in the market value of Common Stock. Financial Industry Regulatory Authority (“FINRA”) sales practice requirements may also limit a stockholder’s ability to buy and sell our stock. In addition to the “penny stock” rules described above, FINRA adopted Rule 2111 that requires a broker-dealer to have reasonable grounds for believing that an investment is suitable for a customer before recommending the investment. Prior to recommending speculative low-priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer’s financial status, tax status, investment objectives, and other information. Under interpretations of these rules, FINRA believes that there is a high probability that speculative low-priced securities will not be suitable for at least some customers. The FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy Common Stock, which may limit your ability to buy and sell our stock and have an adverse effect on the market for our shares. We do not intend to pay dividends for the foreseeable future . We have never declared nor paid any cash dividends on our stock and do not intend to pay any cash dividends in the foreseeable future. We anticipate that we will retain all our future earnings for use in the development of our business and for general corporate purposes. Any determination to pay dividends in the future will be at the discretion of our board of directors. RISKS RELATED TO OUR PREVIOUS STATUS AS A SHELL COMPANY We may have contingent liabilities related to our operations prior to the Merger of which we are not aware and for which we have not adequately provided for. For example, in October 2022, we learned about a Vivos IT, LLC lawsuit against Second Wind Consultants (‘SWC”) in May 2019 which included MMG as a plaintiff. SWC is seeking to collect the balance of $403 not paid by the Vivos Group. In July 2021 the Company paid $475 plus $3 in attorney fees to settle a debt owed by the Vivos Group to Libertas Funding, LLC (“Libertas”). This settlement relieved MMG from obligation to Libertas given the Vivos Group had included MMG as a signing company to its debt in July 2018. In March 2022, Vivos Real Estate defaulted on its mortgage loan with FVCBank for which Maslow was listed as a guarantor. In June 2023, this matter was resolved with the sale of the property, leaving Maslow with no liability. Reliability identified as a shell company with no operating activities prior to the Merger. Upon completion of the Merger, we acquired all of the operations of The Maslow Media Group, Inc. Prior to the consummation of the Merger, Reliability, Incorporated was engaged from 1971 to 2007 in the design, manufacture, market, and support of high-performance equipment used to test and condition integrated circuits. This business was closed in 2007. We cannot assure you that there are no material claims outstanding, or other circumstances of which we are not aware, that would give rise to a material liability relating to those prior operations, even though we do not record any provisions in our financial statements related to any such potential liability. If we are subject to past claims or material obligations relating to our operations prior to the consummation of the Merger, such claims could materially adversely affect our business, financial condition, and results of operations. RISK RELATED TO THE MERGER AND OWNERSHIP OF COMMON STOCK Costs and risks associated with being a public company. The company incurs costs with demands upon management and accounting and finance resources as a result of complying with the laws and regulations affecting public companies; any failure to establish and maintain adequate internal control over financial reporting or to recruit, train and retain necessary accounting and finance personnel could have an adverse effect on our ability to accurately and timely prepare our consolidated financial statements. 22 As a public operating company, we are now incurring significant administrative, legal, accounting, and other burdens and expenses beyond those of a private company, including those associated with corporate governance requirements and public company reporting obligations. We enhanced and supplemented our internal accounting department with additional accounting and finance personnel with public company experience and expertise, added requisite technical resources, as well as refined our quarterly and annual financial statement closing process, to enable us to satisfy such reporting obligations over the past four years. However, even with perceived success in doing so, there can be no assurance that our finance and accounting organization will be able to adequately meet the increased demands that result from being a public company. Furthermore, we are required to comply with Section 404 of the Sarbanes-Oxley Act of 2002. In order to satisfy the requirements of Section 404 of the Sarbanes-Oxley Act of 2002, we are required to document and test our internal control procedures and prepare annual management assessments of the effectiveness of our internal control over financial reporting. These assessments will need to include disclosure of identified material weaknesses in our internal control over financial reporting. Testing and maintaining internal control over financial reporting will involve significant costs and could divert management’s attention from other matters that are important to our business. Additionally, we cannot provide any assurances that we will be successful in remediating any deficiencies that may be identified. If we are unable to remediate any such deficiencies or otherwise fail to establish and maintain adequate accounting systems and internal control over financial reporting, or we are unable to recruit, train, and retain necessary accounting and finance personnel, we may not be able to accurately and timely prepare our consolidated financial statements and otherwise satisfy our public reporting obligations. Any inaccuracies in our consolidated financial statements or other public disclosures (in particular if resulting in the need to restate previously filed financial statements), or delays in our making required SEC filings, could have a material adverse effect on the confidence in our financial reporting, our credibility in the marketplace, and the trading price of Common Stock. We devote significant resources to address public company-associated requirements, including compliance programs as well as our financial reporting obligations. Complying with these rules and regulations has substantially increased our legal and financial compliance costs and make some activities more time-consuming and costly. Our Common Stock may not be eligible for listing on a national securities exchange . Our Common Stock is not currently listed on a national securities exchange, and we do not currently meet the initial quantitative listing standards of a national securities exchange. We cannot assure you that we will be able to meet the initial listing standards of any national securities exchange, or, if we do meet such initial qualitative listing standards, that we will be able to maintain any such listing. Our Common Stock is currently quoted on the pink sheets OTC of the OTC Marketplace under the symbol of “RLBY,” and, unless and until our Common Stock is listed on a national securities exchange, we expect that it will continue to be eligible and quoted on the “pink sheets,” to which time we are eligible to apply to the OTCQB or OTCQX. In order to qualify for the OTCQB for instance, we would need our float to be a minimum of 10% of outstanding shares to even apply for an exception. Currently, our float is 10.4% of our outstanding shares. In those venues, however, an investor may find it difficult to obtain accurate quotations as to the market value of our Common Stock. In addition, if we continue to fail to meet the criteria set forth in SEC regulations, various requirements would be imposed by law on broker-dealers who sell our securities to persons other than established customers and accredited investors. Consequently, such regulations normally deter broker-dealers from recommending or selling common stock, which may further affect its liquidity. This would also make it more difficult for us to raise additional capital. 23 We cannot predict whether there will be an active trading market for our Common Stock and the market price of our Common Stock may remain volatile. Given our low float of approximately 30,129,085 shares and the absence of an active trading market, shareholders may have difficulty buying and selling our Common Stock at all or at the price you consider reasonable. Market visibility for shares of our Common Stock may be limited, which may have a depressive effect on the market price for shares of our Common Stock and on our ability to raise capital or make acquisitions by issuing our Common Stock. Our compliance with regulations concerning corporate governance and public disclosure has resulted and may in the future result in additional expenses. Evolving disclosure, governance and compliance laws, regulations and standards relating to corporate governance and public disclosure, including the Sarbanes-Oxley Act of 2002 (“SOX”) and the Dodd-Frank Wall Street Reform and Consumer Protection Act. New or changing laws, regulations, and standards are subject to varying interpretations in many cases due to their lack of specificity, and, as a result, their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies, which could result in continuing uncertainty regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure and governance practices. As a result, our efforts to comply with evolving laws, regulations, and standards of a public company are likely to continue to result in increased general and administrative expenses and a diversion of management time and attention from revenue-generating activities to compliance activities. ITEM 1B. UNRESOLVED STAFF COMMENTS Not applicable. ITEM 2. PROPERTIES The Company does not have any active office leases at this time and has been operating the Company in a remote environment since April of 2020.