What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2024-03-28 compared with 2023-03-30 · 914 added, 668 removed, 513 unchanged (76% of the section changed)

Financial Statements and Supplementary Data.

Report of Independent Registered Public Accounting Firm

Consolidated balance sheets as of December 31, 2022 and 2021

Consolidated statements of operations for the years ended December 31, 2022 and 2021

Consolidated statements of stockholders’ equity (deficit) for the years ended December 31, 2022 and 2021

Consolidated statements of cash flows for the years ended December 31, 2022 and 2021

Notes to consolidated financial statements

of Independent Registered Public Accounting Firms

balance sheets as of December 31, 2023 and 2022

statements of operations for the years ended December 31, 2023 and 2022

statements of stockholders’ equity (deficit) for the years ended December 31, 2023 and 2022

statements of cash flows for the years ended December 31, 2023 and 2022

to consolidated financial statements

of Independent Registered Public Accounting Firm

1 unchanged sentence

Therapeutics, Inc.

and Subsidiaries

and Subsidiaries (PCAOB ID No.

on the Consolidated Financial Statements

have audited the accompanying consolidated balance sheets of Vivos Therapeutics, Inc.

and Subsidiaries (the “Company”) as

of December 31, 2022 and 2021, the related consolidated statements of operations, stockholders’ equity, and cash flows for each of the

years in the two-year period ended December 31, 2022, and the related notes (collectively referred to as the “financial statements”).

We have audited the accompanying consolidated balance sheet of Vivos Therapeutics,

and Subsidiaries (the “Company”) as of December 31, 2022, the related consolidated statement of operations, stockholders’

equity, and cash flows for the year ended December 31, 2022, and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company

as of December 31, 2022 and 2021, and the results of its operations and its cash flows for each of the years in the two-year period ended

December 31, 2022, in conformity with accounting principles generally accepted in the United States of America.

Company’s Ability to Continue as a Going Concern

financial statements have been prepared assuming the Company will continue as a going concern.

As discussed in Note 2 to the

financial statements, the Company’s significant operating losses raise substantial doubt about the Company’s

ability to continue as a going concern.

Management’s evaluation of the events and conditions and management’s plans in

regarding these matters are also described in Note 2.

The financial statements do not include any adjustments that might result from

the outcome of this uncertainty.

Company’s management is responsible for these financial statements.

Our responsibility is to express an opinion on the Company’s

financial statements based on our audits.

We are a public accounting firm registered with the Public Company Accounting Oversight Board

(United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S.

securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

conducted our audits in accordance with the standards of the PCAOB.

as of December 31, 2022, and the results of its operations and its cash flows for the year ended December 31, 2022, in conformity with

accounting principles generally accepted in the United States of America.

Basis for Opinion

The Company’s management is responsible for these financial statements.

Our responsibility is to express an opinion on the Company’s financial statements based on our audit.

We are a public accounting

firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent

with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities

and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB.

standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of

material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged to perform, an audit of

its internal control over financial reporting.

As part of our audit, we are required to obtain an understanding of internal control over

financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial

Accordingly, we express no such opinion.

Our audit included performing procedures to assess the risks of material

misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures

included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Our audit also included

evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation

of the financial statements.

We believe that our audit provides a reasonable basis for our opinion.

/s/ Plante & Moran, PLLC

Denver, Colorado

March 30, 2023, except for Note 9, as to which the date is November 22,

We served as the Company’s auditor from 2018

of Independent Registered Public Accounting Firm

the Stockholders and Board of Directors of

Therapeutics, Inc.

and Subsidiaries (PCAOB ID No.

on the Consolidated Financial Statements

have audited the accompanying consolidated balance sheet of Vivos Therapeutics, Inc.

and subsidiaries (the “Company”) as

of December 31, 2023, the related consolidated statements of operations, stockholders’ equity and cash flows for the year

then ended, and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion,

the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as

of December 31, 2023, and the consolidated results of its operations and its cash flows for the year then ended, in conformity with

accounting principles generally accepted in the United States of America.

Concern Uncertainty

accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern.

in Note 2 to the consolidated financial statements, the Company has suffered recurring losses from operations that raise substantial

doubt about its ability to continue as a going concern.

Management’s plans in regard to these matters are also described in Note

The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

consolidated financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion

on the Company’s consolidated financial statements based on our audit.

We are a public accounting firm registered with the Public

Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company

in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission

and the PCAOB.

conducted our audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain

reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audits,

we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion

on the effectiveness of the Company’s internal control over financial reporting.

reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

of our audit we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing

an opinion on the effectiveness of the Company’s internal control over financial reporting.

Accordingly, we express no such opinion.

audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error

or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding

the amounts and disclosures in the financial statements.

Our audits also included evaluating the accounting principles used and significant

estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audits

provide a reasonable basis for our opinion.

Plante & Moran, PLLC

audit included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due

to error or fraud, and performing procedures to respond to those risks.

Such procedures included examining, on a test basis, evidence

regarding the amounts and disclosures in the consolidated financial statements.

Our audit also included evaluating the accounting principles

used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that our audit provide a reasonable basis for our opinion.

Moss Adams, LLP

have served as the Company’s auditor since 2023.

4 unchanged sentences

Current assets

Cash and cash equivalents

Accounts receivable, net of allowance of $ 712 and $ 180 , respectively

Tenant improvement allowance receivable

Prepaid expenses and other current assets

Cash and cash

Accounts receivable, net

of allowance of $ 250 and $ 712 , respectively

expenses and other current assets

Total current assets

Long-term assets

Property and equipment, net

Operating lease right-of-use asset

Intangible assets, net

Deposits and other

LIABILITIES AND STOCKHOLDERS’ EQUITY

and equipment, net

lease right-of-use asset

LIABILITIES AND STOCKHOLDERS’

Current liabilities

1 unchanged sentence

Accrued expenses

Current portion of contract liabilities

Current portion of long-term debt

Current portion of operating lease liability

Current portion of deferred rent

Current portion of lease incentive liability

Other current liabilities

Current portion of contract

Current portion of operating

lease liability

current liabilities

Total current liabilities

Long-term liabilities

Contract liabilities, net of current portion

Operating lease

liability, net of current portion

Deferred rent, net of current portion

Lease incentive liability, net of current portion

Total liabilities

Commitments and contingencies (Note 13)

Contract liabilities, net

of current portion

Employee retention credit

lease liability, net of current portion

Commitments and contingencies

Stockholders’ equity

Preferred Stock, $ 0.0001 par value per share.

Preferred Stock, $ 0.0001

par value per share.

Authorized 50,000,000 shares;

issued and outstanding

no shares issued and outstanding

Common Stock, $ 0.0001 par value per share.

Authorized 200,000,000 shares;

issued and outstanding

23,012,119 shares as of December 31,2022 and December 31, 2021

issued and outstanding 1,833,877 shares as of December 31, 2023 and 920,592 shares as December 31,

Additional paid-in capital

Accumulated deficit

Total stockholders’ equity

Total liabilities and stockholders’ equity

stockholders’ equity

liabilities and stockholders’ equity

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

4 unchanged sentences

Product revenue

Service revenue

Cost of sales (exclusive of depreciation and amortization shown separately

Total revenue

of sales (exclusive of depreciation and amortization shown separately below)

Operating expenses

1 unchanged sentence

Sales and marketing

Impairment loss

Depreciation and amortization

Total operating expenses

and amortization

operating expenses

Operating loss

Non-operating income (expense)

Interest expense

Other expense

PPP loan forgiveness

Excess warrant fair value

Change in fair value of

warrant liability, net of issuance costs of $ 645

Loss before income taxes

Income tax expense

Net loss attributable to common stockholders

Net loss per share attributable to common stockholders (basic and diluted)

Weighted average number of shares of Common Stock outstanding (basic and

Net loss per share (basic

Weighted average number

of shares of Common Stock outstanding (basic and diluted)

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

THERAPEUTICS INC.

Statements of Stockholders’ Equity (Deficit)

Statements of Stockholders’ Equity

Ended December 31, 2023 and 2022

Balances, December 31, 2021

Issuance of Common Stock:

In follow-on public offering, net of issuance costs

To consultants for services

Exercise of stock options

Fair value of warrants issued:

To consultants for services

In business combination

For purchase of assets

Stock-based compensation expense

Issuance of warrants to

consultants for services

Stock-based compensation

Balances, December 31, 2022

Fair value of warrants issued:

To consultants for services

In business combination

Issuance of common stock

and warrants in private placement, net of issuance costs

Issuance of common stock

and warrants to consultants for services

Issuance of common stock

for purchase of assets

Stock-based compensation expense

Issuance of commons stock upon exercise of

Shares added for fractional shares pursuant to reverse stock split

Reclassification of liability-classified

warrants to equity

Stock-based compensation

Balances, December 31, 2023

3 unchanged sentences

Ended December 31, 2023 and 2022

CASH FLOWS FROM OPERATING ACTIVITIES:

Adjustments to reconcile net loss to net cash used in operating activities:

Stock-based compensation expense

Loss on disposal of assets

CASH FLOWS FROM OPERATING

Adjustments to reconcile net loss to net cash

used in operating activities:

Stock-based compensation

Depreciation and amortization

Fair value of warrants issued for services

Common stock issued for services

Accretion of discount on note receivable

Forgiveness of indebtedness income

Impairment on note receivable

Changes in operating assets and liabilities:

Loss on disposal of assets

Fair value of common stock

issued for services

Fair value of warrants

issued for services

Change in fair value of

warrant liability, net of issuance costs of $ 645

Excess warrant fair value

Forgiveness of indebtness

Changes in operating assets

and liabilities:

Accounts receivable

Operating lease assets and

liabilities, net

Operating lease liabilities,

Tenant improvement allowance

Prepaid expenses and other current assets

Prepaid expenses and other

current assets

Accounts payable

Accrued expenses

Employee retention credit

Other liabilities

Contract liability

Net cash used in operating activities

CASH FLOWS FROM INVESTING ACTIVITIES:

Acquisitions of property and equipment

Payment for business acquisition

Principal collections under note receivable

Net cash used in investing activities

CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from issuance of common stock

Redemption of preferred stock

Payments for issuance costs

Principal payments on debt

Net cash provided by financing activities

Net decrease in cash and cash equivalents

Cash and cash equivalents at beginning of year

Cash and cash equivalents at end of year

cash used in operating activities

CASH FLOWS FROM INVESTING

Acquisitions of property

and equipment

for asset purchase

cash used in investing activities

CASH FLOWS FROM FINANCING

Proceeds from the private

placement of common stock and pre-funded warrants

for issuance costs

cash provided by financing activities

Net increase (decrease)

in cash and cash equivalents

Cash and cash equivalents

at beginning of year

and cash equivalents at end of year

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

Cash paid for interest

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND

FINANCING ACTIVITIES:

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:

Fair value of warrants issued in asset purchase

Fair value of warrants issued in business acquisition

Fair value of warrants issued to underwriters in connection with follow-on offering

Capital expenditures included in accounts payable

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

THERAPEUTICS INC.

to Consolidated Financial Statements

Notes to the Consolidated Financial Statements

1 - ORGANIZATION, DESCRIPTION AND SIGNIFICANT ACCOUNTING POLICIES

24 unchanged sentences

refers to the common stock, $ 0.0001 par value per share, of Vivos Therapeutics, Inc., a Delaware corporation.

Company is a medical technology company focused on the development and commercialization to dental practices of a patented oral appliance

technology and related treatments and training called The Vivos Method.

The Company believes The Vivos Method represents the first non-surgical,

non-invasive and cost-effective treatment for people with dentofacial abnormalities and/or mild to moderate OSA and snoring in adults.

The Company’s business model is focused around dentists, and the Company’s program to train dentists and offer them other

value-added services in connection with their ordering and use of The Vivos Method for patients is called the Vivos Integrated Practice

(“VIP”) program.

October 25, 2023, the Company effected a reverse stock split of its outstanding shares of common stock at a ratio of 1-for-25 (the “Reverse

Stock Split”).

The Reverse Stock Split, which was approved by the Company’s Board of Directors under authority granted by

the Company’s stockholders at the Company’s 2023 Annual Meeting of Stockholders held on September 22, 2023, was consummated

pursuant to a Certificate of Amendment filed with the Secretary of State of Delaware on October 25, 2023 (the “Certificate of Amendment”).

Unless the context otherwise requires, all references in the accompanying financial statements, these footnotes to the financial statements

in general to shares of the Company’s common stock, including prices per share of the common stock, reflect the Reverse Stock Split.

Fractional shares were not issued, and the final number of shares were rounded up to the next whole share.

are a medical technology and services company that features a comprehensive suite of proprietary oral appliances and therapeutic

Our products non-surgically treat certain maxillofacial and developmental abnormalities of the mouth and jaws that are

closely associated with breathing and sleep disorders such as, mild to severe obstructive sleep apnea (“OSA”) and

snoring in adults.

The Company offers three separate clinical pathways or programs to providers—Guided Growth and Development,

Lifeline, and Complete Airway Repositioning and Expansion (“CARE”).

Each program features certain oral appliances

coupled with specific therapeutic treatments, and each clinical pathway is intended to address the specific needs of a diverse

patient population with different patient journeys.

For example, the Guided Growth and Development program features the Vivos Guide

and PE x appliances along with CO 2 laser treatments and other adjunctive therapies designed for treating

palatal growth and expansion in pediatric patients as they grow.

The mid-range priced Lifeline program features a selection of

mandibular advancement devices (“MADs”) such as the Versa and Vida Sleep which are FDA 510(k) cleared for

mild-to-moderate OSA in adults, along with the patented Vida appliance, which is FDA 510(k) cleared as unspecified classification

for the alleviation of Temporomandibular Joint Dysfunction (“TMD”) symptoms, bruxism, migraine headaches, and nasal

Company’s flagship CARE program, which is part of The Vivos Method, features the Company’s patented DNA, mRNA and mmRNA appliances,

which are also FDA 510(k) cleared for mild-to-severe OSA and snoring in adults.

The Vivos Method may also include adjunctive myofunctional,

chiropractic/physical therapy, and laser treatments that, when properly used with the CARE appliances, constitute a powerful non-invasive

and cost-effective means of reducing or eliminating OSA symptoms.

In a small subset of a study, the data has actually shown that The

Vivos Method can reverse OSA symptoms in a large portion (up to 80 %) of patients.

The primary competitive advantage of The Vivos Method

over other OSA therapies is that The Vivos Method’s typical course of treatment is limited in most cases to 12 to 15 months, and

it is possible not to need lifetime intervention, unlike CPAP and neuro-stimulation implants.

Additionally, out of approximately 42,000

patients treated to date worldwide with the Company’s entire current suite of products, there have been very few instances of relapse.

Company offers a suite of diagnostic and support products and services to dental and medical providers and distributors who service patients

with OSA or related conditions.

Such products and services include (i) VivoScore home sleep screenings and tests (powered by SleepImage ®

technology), (ii) AireO2 (an electronic health record program designed specifically for use by dentists treating sleep patients),

(iii) Treatment Navigator (a concierge service to assist a provider in educating and supporting the doctors as they navigate insurance

coverage, diagnostic indications and treatment options), (iv) Billing Intelligence Services (which optimizes medical and dental reimbursement),

(v) advanced training and continuing education courses at the Company’s Vivos Institute in Denver, Colorado, (vi) MyoCorrect, a

service through which Vivos-trained providers can provide orofacial myofunctional therapy (“OMT”) to patients via a telemedicine

platform, and (vii) the Company’s Medical Integration Division (“MID”), which manages independent medical practices

under management and development agreement which pays the Company from six ( 6 %) to eight ( 8 %) percent of all net revenue from sleep-related

services as well as development fees.

Company’s business model is to teach, train, and support dentists, medical doctors, and distributors in the use of the Company’s

products and services.

Dentists who use the Company’s products and services typically enroll in a variety of live or online training

and educational programs offered through the Company’s Vivos Institute—an 18,000 sq.

facility located near the Denver

International Airport.

Dentists are able to select the specific program or clinical pathway that they want to focus on, such as Guided

Growth and Development or Lifeline or both.

They may also enroll in the VIP program for the complete set training, educational, and support

services available in all three clinical pathway programs.

Dentists enrolled in the VIP Program are referred to as “VIPs.”

addition to providing VIPs with appliances for use with their patients, the Company offers other products and services to VIPs, including

(i) SleepImage ® home sleep apnea test rings (“SleepImage”), which can be leased to VIPs for use with patients;

(ii) training and continuing education at the Company’s Vivos Institute training center, (iii) the Billing Intelligence Service

(“BIS”), a subscription-based billing solution for VIPs, (iv) the Company’s Medical Integration Division (“MID”),

which manages independent medical practices under management and development agreement which pays the Company from six ( 6 %)

to eight ( 8 %)

percent of all net revenue from sleep-related services as well as development fees and (v) MyoCorrect, a service through which VIPs can

provide orofacial myofunctional therapy (“OMT”) to patients via telemedicine technology (“MyoCorrect”).

The Company charges up front enrollment fees to educate and train new providers.

The Company also charges for the ancillary support services

listed above, and views each product and service as a revenue/profit center.

of Presentation and Consolidation

accompanying condensed consolidated financial statements, which include the accounts of the Company and its wholly owned

subsidiaries (BioModeling, First Vivos, Vivos Therapeutics (Canada) Inc., Vivos Management and Development, LLC, Vivos Del Mar

Management, LLC, Vivos Modesto Management, LLC, Vivos Therapeutics DSO LLC, a Colorado limited liability company, and Vivos Airway

Alliances, LLC, a Colorado limited liability company), are prepared in conformity with generally accepted accounting principles in

the United States of America (“U.S.

All significant intercompany balances and transactions have been eliminated

in consolidation.

accompanying consolidated financial statements, which include the accounts of the Company and its wholly owned subsidiaries (BioModeling,

First Vivos, Vivos Therapeutics (Canada) Inc., Vivos Management and Development, LLC, Vivos Del Mar Management, LLC, Vivos Modesto Management,

LLC, Vivos Therapeutics DSO LLC, a Colorado limited liability company, and Vivos Airway Alliances, LLC, a Colorado limited liability

company), are prepared in conformity with generally accepted accounting principles in the United States of America (“U.S.

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

Growth Company Status

Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our

Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements

that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required

to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”),

reduced disclosure obligations regarding executive compensation, and exemptions from the requirements of holding a nonbinding advisory

vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.

Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting

standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do

not have a class of securities registered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) are

required to comply with the new or revised financial accounting standards.

The JOBS Act provides that a company can elect to opt out

of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election

to opt out is irrevocable.

The Company currently expects to retain its status as an emerging growth company until the year ending December

31, 2026, but this status could end sooner under certain circumstances.

Company is an “emerging growth company” (an “EGC”), as defined in Section 2(a) of the Securities Act, as modified

by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and as a result, the Company may take advantage of certain

exemptions from various reporting requirements that are applicable to other public companies that are not EGCs.

These include, but are

not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002

(the “Sarbanes-Oxley Act”), reduced disclosure obligations regarding executive compensation, and exemptions from the requirements

of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously

Section 102(b)(1) of the JOBS Act exempts EGCs from being required to comply with new or revised financial accounting standards until

private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class

of securities registered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) are required to comply

with the new or revised financial accounting standards.

The JOBS Act provides that a company can elect to opt out of the extended transition

period and comply with the requirements that apply to non-EGC but any such election to opt out is irrevocable.

The Company currently

expects to retain its status as an EGC until the year ending December 31, 2026, but this status could end sooner under certain circumstances.

Company generates revenue from the sale of products and services.

A significant majority of the Company’s revenues are generated

from enrolling dentists in the VIP program and sales of products and services to VIPs.

Revenue is recognized when control of the products

or services is transferred to customers (i.e., VIP dentists ordering such products or services for their patients) in a way that reflects

the consideration the Company expects to be entitled to in exchange for those products and services.

the guidance of ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”)

and the applicable provisions of ASC Topic 842, Leases (“ASC 842”) , the

Company determines revenue recognition through the following five-step model, which entails:

from enrolling dentists as either (i) Guided Growth and Development VIPs;

(ii) Lifeline VIPs;

(iii) combined Guided Growth and Development

and Lifeline VIPs;

or Premier Vivos Integrated Providers (Premier VIPs).

Prior to the second quarter of 2023, the majority of VIP enrollments

were Premier VIPs.

The other, lower priced enrollments were piloted in prior fiscal quarters on a limited basis.

They were officially

adopted during the second quarter of 2023.

For each VIP program, revenue is recognized when control of the products or services is transferred

to customers (i.e., VIP dentists ordering such products or services for their patients) in a manner that reflects the consideration the

Company expects to be entitled to in exchange for those products and services.

the guidance of ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”) and the applicable provisions of

ASC Topic 842, Leases (“ASC 842”), the Company determines revenue recognition through the following five-step model,

which entails:

identification

7 unchanged sentences

Company reviews its VIP enrollment contracts from a revenue recognition perspective using the 5-step method outlined above.

determined that a contract exists (a VIP enrollment agreement is executed and payment is received), service revenue related to VIP enrollments

is recognized when the underlying services are performed.

The price of the standard VIP enrollment that the VIP pays upon execution of

the contract is significant, running at approximately $ 31,500 , with different entry levels from $ 2,500 to $ 50,000 .

Unearned revenue reported on the balance sheet as contract liability represents

the portion of fees paid by VIP customers for services that have not yet been performed as of the reporting date and are recorded as

the service is rendered.

enrollees, irrespective of their level of enrollment, are commonly referred to as VIPs, unless it is necessary to specify their particular

Once it is determined that a contract exists (i.e., a VIP enrollment agreement is executed and payment is received), service

revenue related to VIP enrollments is recognized when the underlying services are performed.

The price of the Premier VIP enrollment

that the VIP pays upon execution of the contract is significant, running at approximately $ 26,200 ,

with different entry levels for the various programs described above .

Unearned revenue reported on the balance sheet as contract

liability represents the portion of fees paid by VIP customers for services that have not yet been performed as of the reporting date

and are recorded as the service is rendered.

The Company recognizes this revenue as performance obligations are met.

Accordingly, the contract liability

for unearned revenue is a significant liability for the Company.

Provisions for discounts are provided in the same period that the related

revenue from the products and/or services is recorded.

Accordingly, the

contract liability for unearned revenue is a significant liability for the Company.

Provisions for discounts are provided in the same

period that the related revenue from the products and/or services is recorded.

Company enters into programs that may provide for multiple performance obligations.

Commencing in 2018, the Company began enrolling medical

and dental professionals in a one-year program (later known as the VIP Program) which includes training in a highly personalized, deep

immersion workshop format which provides the VIP dentist access to a team who is dedicated to creating a successful integrated practice.

The key topics covered in training include case selection, clinical diagnosis, appliance design, adjunctive therapies, instructions on

ordering the Company’s products, guidance on pricing, instruction on insurance reimbursement protocols and interacting with our

proprietary software system and the many features on the Company’s website.

The initial training and educational workshop are typically

provided within the first 30 to 45 days that a VIP enrolls.

Ongoing support and additional training are provided throughout the year and

includes access to the Company’s proprietary Airway Intelligence Service (“AIS”) which provides the VIP with resources

to help simplify the diagnostic and treatment planning process.

AIS is provided as part of the price of each appliance and is not a separate

revenue stream.

Following the year of training and support, a VIP may pay for seminars and training courses that meet the Provider’s

needs on a subscription or a course-by-course basis.

and dental professionals in a one-year program (now known as the Premier VIP Program) which includes training in a highly personalized,

deep immersion workshop format which provides the Premier VIP dentist access to a team who is dedicated to creating a successful integrated

enrollment fees include multiple performance obligations which vary on a contract-by-contract basis.

16 unchanged sentences

Company uses significant judgements in revenue recognition including an estimation of customer life over which it recognizes the right

The Company has determined that VIPs who do not complete sessions 1 and 2 of training rarely complete training at all and fail

to participate in the VIP program long term.

Since the beginning of the VIP program, just under one-third of new VIP members fall into

this category, and the revenue allocated to the right to sell for those VIPs is accelerated at the time in which it becomes remote that

a VIP will continue in the program.

Revenue is recognized in accordance with each individual performance obligation unless it becomes

remote the VIP would continue, at which time the remainder of review is accelerated and recognized in the following month.

who complete training typically remain active for a much longer period, and revenue from the right to sell for those VIPs is recognized

over the estimated period of which those VIPs will remain active.

Because of various factors occurring year to year, the Company has

estimated customer life for each year a contract is initiated.

The estimated customer lives are calculated separately for each year and

have been estimated at 15 months for 2020, 14 months for 2021 and 18 months for 2022.

The right to sell is recognized on a sum of the

years’ digits method over the estimated customer life for each year as this approximates the rate of decline in VIPs purchasing

behaviors we have observed.

The Company has determined that Premier VIPs who do not complete sessions 1 and 2 of training rarely complete training at all

and fail to participate in the Premier VIP program long term.

Since the beginning of the Premier VIP program, just under one-third of

new VIP members fall into this category, and the revenue allocated to the right to sell for those VIPs is accelerated at the time in

which it becomes remote that a VIP will continue in the program.

Revenue is recognized in accordance with each individual performance

obligation unless it becomes remote the VIP will continue, at which time the remainder of revenue is accelerated and recognized in the

following month.

Those VIPs who complete training typically remain active for a much longer period, and revenue from the right to sell

for those VIPs is recognized over the estimated period of which those VIPs will remain active.

Because of various factors occurring year

to year, the Company has estimated customer life for each year a contract is initiated.

The estimated customer lives are calculated separately

for each year and have been estimated at 15 months for 2020, 14 months for 2021, 18 months for 2022, and 23 months for 2023, as a result

of customers staying active for longer periods of time.

The right to sell is recognized on a sum of the years’ digits method over

the estimated customer life for each year as this approximates the rate of decline in VIPs purchasing behaviors we have observed.

Service Revenue

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monthly during the month the services are rendered.

the Company offers its VIPs the ability to provide MyoCorrect to the VIP’s patients as part of treatment with The Vivos

Company also offers its VIPs the ability to provide MyoCorrect to the VIP’s patients as part of treatment with The Vivos Method.

The program includes packages of treatment sessions that are sold to the VIPs, and resold to their patients.

Revenue for MyoCorrect

services is recognized over the 12-month performance period as therapy sessions occur.

Revenue for MyoCorrect services

is recognized over the 12-month performance period as therapy sessions occur.

of Revenue to Performance Obligations

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reporting period and any changes in circumstances during the reporting period.

addition to revenue from services, the Company also generates revenue from the sale of its patented oral devices and preformed guides

addition to revenue from services, the Company also generates revenue from the sale of its line of oral devices and preformed guides

(known as appliances or systems) to its customers, the VIP dentists.

Revenue from the appliance sale is recognized when control of product

is transferred to the VIP in an amount that reflects the consideration it expects to be entitled to in exchange for those products.

VIP in turn charges the VIP’s patient and or patient’s insurance a fee for the appliance and for his or her professional

services in measuring, fitting, installing the appliance and educating the patient as to its use.

The Company is contracted with VIPs

for the sale of the appliance and is not involved in the sale of the products and services from the VIP to the VIP’s patient.

appliance is similar to a retainer that is worn after braces are removed.

Each appliance is unique and is fitted to the patient.

Company utilizes its network of certified VIPs throughout the United States and in some non-U.S.

jurisdictions to sell the appliances

to their customers as well as in two centers that the Company operates.

The Company utilizes third party contract manufacturers or labs

to produce its unique, patented appliances and preformed guides.

The manufacturer designated by the Company produces the appliance in

strict adherence to the Company’s patents, design files, treatments, processes and procedures and under the direction and specific

instruction of the Company, ships the appliance to the VIP who ordered the appliance from the Company.

All of the Company’s contract

manufacturers are required to follow the Company’s master design files in production of appliances or the lab will be in violation

of the FDA’s rules and regulations.

The Company performed an analysis under ASC 606-10-55-36 through 55-40 and concluded it is

the principal in the transaction and is reporting revenue gross.

The Company bills the VIP the contracted price for the appliance which

is recorded as product revenue.

Product revenue is recognized once the appliance ships to the VIP under the direction of the Company.

each center, the Company utilizes a team of medical professionals to measure, order and fit each appliance.

Upon scheduling the patient

(which is the Company’s customer in this case), the center takes a deposit and reviews the patient’s insurance coverage.

Revenue is recognized differently for Company owned centers than for revenue from VIPs.

The Company recognizes revenue in the centers

after the appliance is received from the manufacturer and once the appliance is fitted and provided to the patient.

These include the DNA appliance ® , mRNA appliance ® ,

the mmRNA appliance, the Versa, , the Vida, the Vida Sleep and others.

The Company expanded its product offerings in the first quarter

of 2023 via the acquisition of certain U.S.

and international patents, product rights, and other miscellaneous intellectual property

from Advanced Facialdontics, LLC, a New York limited liability company (“AFD”).

Revenue from appliance sales is recognized

when control of product is transferred to the VIP in an amount that reflects the consideration it expects to be entitled to in exchange

for those products.

The VIP in turn charges the VIP’s patient and or patient’s insurance a fee for the appliance and for

his or her professional services in measuring, fitting, installing the appliance and educating the patient as to its use.

contracts with VIPs for the sale of the appliance and is not involved in the sale of the products and services from the VIP to the VIP’s

Company’s appliances are similar to a retainer that is worn in the mouth after braces are removed.

Each appliance is unique and

is fitted to the patient.

The Company utilizes its network of certified VIPs throughout the United States and in some non-U.S.

jurisdictions

to sell the appliances to their customers as well as in two dental centers that the Company operates.

The Company utilizes third party

contract manufacturers or labs to produce its unique, patented appliances and preformed guides.

The manufacturer designated by the Company

produces the appliance in strict adherence to the Company’s patents, design files, treatments, processes and procedures and under

the direction and specific instruction of the Company, ships the appliance to the VIP who ordered the appliance from the Company.

of the Company’s contract manufacturers are required to follow the Company’s master design files in production of appliances

or the lab will be in violation of the FDA’s rules and regulations.

The Company performed an analysis under ASC 606-10-55-36 through

55-40 and concluded it is the principal in the transaction and is reporting revenue gross.

The Company bills the VIP the contracted price

for the appliance which is recorded as product revenue.

Product revenue is recognized once the appliance ships to the VIP under the direction

of the Company.

support of the VIPs using the Company’s appliances for their patients, the Company utilizes a team of trained technicians to measure,

order and fit each appliance.

Upon scheduling the patient (which is the Company’s customer in this case), the center takes a deposit

and reviews the patient’s insurance coverage.

Revenue is recognized differently for Company owned centers than for revenue from

The Company recognizes revenue in the centers after the appliance is received from the manufacturer and once the appliance is fitted

and provided to the patient.

Company offers certain dentists (known as Clinical Advisors) discounts from standard VIP pricing.

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volume within their practices.

These performance obligations are recorded as revenue in future periods over the life of the credit.

These incentives are recorded as a liability at issuance and deducted from the related product sale at

the time the credit is used.

preparation of financial statements and related disclosures in conformity with U.S.

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significant accounting estimates include, but are not necessarily limited to, assessing collectability on accounts receivable, the determination

of customer life and breakage related to recognizing revenue for VIP contracts, notes receivable, impairment of goodwill and long-lived

valuation assumptions for assets acquired in business combinations;

valuation assumptions for stock options, warrants and equity

of customer life and breakage related to recognizing revenue for VIP contracts, impairment of goodwill and long-lived assets;

assumptions for assets acquired in asset acquisitions;

valuation assumptions for stock options, warrants, warrant liabilities and equity

instruments issued for goods or services;

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Receivable, Net

accounts receivable in the accompanying financial statements are stated at the amounts management expects to collect.

The Company performs

credit evaluations of its customers’ financial condition and may require a prepayment for a portion of the services to be performed.

The Company reduces accounts receivable by estimating an allowance that may become uncollectible in the future.

Management determines

the estimated allowance for uncollectible amounts based on its judgements in evaluating the aging of the receivables and the financial

condition of our clients.

receivable represents amounts due from customers in the ordinary course of business and are recorded at the invoiced amount and do not

bear interest.

Accounts receivable are stated at the net amount expected to be collected, using an expected credit loss methodology to

determine the allowance for expected credit losses.

The Company evaluates the collectability of its accounts receivable and determines

the appropriate allowance for expected credit losses based on a combination of factors, including the aging of the receivables, historical

collection trends, and charge-offs.

When the Company is aware of a customer’s inability to meet its financial obligation, the Company

may individually evaluate the related receivable to determine the allowance for expected credit losses.

The Company uses specific criteria

to determine uncollectible receivables to be charged-off, including bankruptcy filings, the referral of customer accounts to outside

parties for collection, and the length that accounts remain past due.

and Equipment, Net

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The Company does not begin depreciating assets until assets are placed in service.

assets consist of assets acquired from First Vivos and costs paid to (i) MyoCorrect, LLC (“MyoCorrect LLC”), from whom the

Company acquired certain assets related to its OMT service in March 2021 and (ii) Lyon Management and Consulting, LLC and its affiliates

(“Lyon Dental”), from whom the Company acquired certain medical billing and practice management software, licenses and contracts

in April 2021 (including the software underlying AireO2) for work related to the Company’s acquired patents, intellectual property

and customer contracts.

The identifiable intangible assets acquired from First Vivos and Lyon Dental for customer contracts are amortized

using the straight-line method over the estimated life of the assets, which approximates 5 years (See Note 5).

The costs paid to MyoCorrect

LLC and Lyon Dental for patents and intellectual property are amortized over the life of the underlying patents, which approximates 15

is the excess of acquisition cost of an acquired entity over the fair value of the identifiable net assets acquired.

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We test for impairment annually as of December 31.

There were no quantitative or qualitative indicators of impairment that occurred for the year ended December 31,

2022 and accordingly, no impairment was required.

There were no quantitative or qualitative indicators

of impairment that occurred for the year ended December 31, 2023, and no impairment was required.

assets consist of assets acquired from First Vivos and costs paid to (i) MyoCorrect, from whom the Company acquired certain assets related

to its OMT service in March 2021, (ii) Lyon Management and Consulting, LLC and its affiliates (“Lyon Dental”), from whom

the Company acquired certain medical billing and practice management software, licenses and contracts in April 2021 (including the software

underlying AireO2) for work related to the Company’s acquired patents, intellectual property and customer contracts and (iii) AFD,

from whom the Company acquired certain U.S.

and international patents, trademarks, product rights, and other miscellaneous intellectual

property in March 2023.

The identifiable intangible assets acquired from First Vivos and Lyon Dental for customer contracts are amortized

using the straight-line method over the estimated life of the assets, which approximates 5 years (See Note 5).

The costs paid to MyoCorrect,

Lyon Dental and AFD for patents and intellectual property are amortized over the life of the underlying patents, which approximates 15

Intangible assets consist of assets acquired from First Vivos and costs

paid to (i) MyoCorrect, from whom the Company acquired certain assets related to its OMT service in March 2021, (ii) Lyon Management and

Consulting, LLC and its affiliates (“Lyon Dental”), from whom the Company acquired certain medical billing and practice management

software, licenses and contracts in April 2021 (including the software underlying AireO2) for work related to the Company’s acquired

patents, intellectual property and customer contracts and (iii) AFD, from whom the Company acquired certain U.S.

and international patents,

trademarks, product rights, and other miscellaneous intellectual property in March 2023.

The identifiable intangible assets acquired from

First Vivos and Lyon Dental for customer contracts are amortized using the straight-line method over the estimated life of the assets,

which approximates 5 years (See Note 5).

The costs paid to MyoCorrect, Lyon Dental and AFD for patents and intellectual property are amortized

over the life of the underlying patents, which approximates 15 years.

of Long-lived Assets

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require significant judgment and actual results may differ from assumed and estimated amounts.

There were no quantitative or qualitative indicators of impairment that occurred for the year ended December 31, 2022 and accordingly,

no impairment was required.

There were no quantitative or qualitative

indicators of impairment that occurred for the year ended December 31, 2023, and no impairment was required.

Offering Costs

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recorded a gain on the forgiveness of the loan in the quarter ended March 31, 2022 under non-operating income (expense).

Retention Tax Credit

employee retention tax credit (“ERTC”) for 2020 was established under the Coronavirus Aid, Relief, and Economic Security

Act of 2020 (the “CARES Act”) and amended by the Taxpayer Certainty and Disaster Tax Relief Act of 2020 (the “Relief

The ERTC provided for changes in the employee retention credit for 2020 and provided an additional credit for the first,

second and third calendar quarters of 2021.

Employers are eligible for the credit if they experienced either a full or partial suspension

of operations during any calendar quarter because of governmental orders due to the COVID-19 pandemic or if they experienced a significant

decline in gross receipts based on a comparison of quarterly revenue results for 2020 and/or 2021 and the corresponding quarters in 2019.

The ERTC is a refundable credit that employers can claim on qualified wages paid to employees, including certain health insurance costs.

to the Internal Revenue Service (“IRS”) Notice 2021-20, “Guidance on the Employee Retention Credit under Section 2301

of the Coronavirus Aid, Relief, and Economic Security Act,” the period during which there is a significant decline in gross receipts

is determined by identifying the first quarter in 2020 in which the gross receipts are less than 50 % of its gross receipts for the same

period in 2019.

The employee retention credit is available only to eligible employers.

Section 2301(c)(2)(A) of the CARES Act defines

the term “eligible employer” as any employer carrying on a trade or business during calendar year 2020, and, with respect

to any calendar quarter, for which (1) the operation of the trade or business carried on during calendar year 2020 is fully or partially

suspended due to orders from an appropriate governmental authority limiting commerce, travel, or group meetings (for commercial, social,

religious, or other purposes) due to COVID-19, or (2) such calendar quarter is within the period in which the employer had a significant

decline in gross receipts, as described in section 2301(c)(2)(B) of the CARES Act.

VIP dentists and potential VIPs were forced to close

their offices during 2020 as a result of COVID-19.

Therefore, the Company qualifies as an eligible employer under this under the CARES

2301(c)(3)(A)(ii) of the CARES Act also provides that if an eligible employer averaged 100 or fewer employees in 2019 (a “small

eligible employer”), qualified wages are those wages paid by the eligible employer with respect to an employee during any period

described in section 2301(c)(2)(A)(ii)(I) of the CARES Act (relating to a calendar quarter for which the operation of a trade or business

is fully or partially suspended due to a governmental order) or during a calendar quarter within the period described in section 2301(c)(2)(A)(ii)(II)

of the CARES Act (relating to a significant decline in gross receipts).

The Company averaged fewer than 80 employees in 2019 and is therefore

considered a small eligible employer under the CARES Act.

plan expenses were not included in the analysis, although they are eligible if an employee has paid health insurance through their paycheck.

Section 2301(c)(5)(B) of the CARES Act provides that “wages” include amounts paid by an eligible employer to provide and

maintain a group health plan (as defined in section 5000(b)(1) of the Code), but only to the extent that the amounts are excluded from

the gross income of employees by reason of section 106(a) of the Code.

The Company pays the first $500 of healthcare insurance for each

employee, which generally covers the monthly cost of their insurance.

Because of this, the Company conservatively did not include any

of the cost of insurance in its analysis.

Additionally, PPP loan amounts were deducted from the amount of total wages paid before calculating

the qualified ERTC wages.

The Company applied for the ERTC using Vivos Therapeutics Inc.’s payroll, which covers 95% of its employees .

indicated above, for 2020, companies were eligible for a credit equal to 50 percent of the first ten thousands of qualified wages paid

per employee in the aggregate of each eligible quarter.

Therefore, the maximum ERTC for the Company for 2020 is five thousand ($5,000)

per employee.

For the second and fourth quarters of 2020, the total eligible credit was limited to approximately $0.5 million .

2021, the ERTC was 70 % of the first ten thousand qualified wages paid per employee each quarter.

Accordingly, the credit was limited

to approximately $ 0.7 million.

As there is no authoritative guidance under U.S.

GAAP on accounting for government assistance to for-profit

business entities, the Company accounted for the ERTC by analogy to ASC 450, Contingencies .

Accordingly, under ASC 450, entities

would treat the ERTCs (whether received in cash or as an offset to current or future payroll taxes) as if they were gain contingencies.

When applying ASC 450-30, entities would not consider the probability of complying with the terms of the ERC program but, rather, would

defer any recognition in the income statement until all uncertainties are resolved and the income is “realized” or “realizable”

(i.e., upon receipt of the funds or formal notice by the IRS that the company is entitled to such funds).

In our case, the Company elected

to follow a more conservative approach and instead of recognizing a receivable for amounts to be received when the amended tax forms

were filed in 2022, it was decided to wait for the notice from IRS and cash was received.

As for financial statement presentation, it

is believed that either classifying the amounts as a reduction to payroll tax expense (expense off-set is however contrary to U.S.

or as other income to be acceptable with appropriate disclosure of the election made by the company.

However, the IRS issued a renewed

warning regarding the ERTC on March 7, 2023 urging taxpayers to carefully review the ERTC guidelines.

The Company continues to evaluate

additional information from the IRS, and elected to disclose the funds received as a separate line item under long-term liabilities on

the balance sheet, until more information becomes available from the IRS.

As a result, for the period ending December 31, 2023, approximately

$ 1.2 million was recorded under long-term liabilities.

and Gain Contingencies

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until realization is assured, which typically requires collection in cash.

Company measures the cost of employee and director services received in exchange for all equity awards granted, including stock

options, based on the fair market value of the award as of the grant date.

The Company computes the fair value of stock options

using the Black-Scholes-Merton (“BSM”) option pricing model.

The Company estimates the expected term using the

simplified method which is the average of the vesting term and the contractual term of the respective options.

determines the expected price volatility based on the historical volatilities of shares of the Company’s peer group as the

Company does not have a sufficient trading history for its Common Stock.

Industry peers consist of several public companies in the

bio-tech industry similar to the Company in size, stage of life cycle and financial leverage.

The Company intends to continue to

consistently apply this process using the same or similar public companies until a sufficient amount of historical information

regarding the volatility of the Company’s own stock price becomes available, or unless circumstances change such that the

identified companies are no longer similar to the Company, in which case, more suitable companies whose share prices are publicly

available would be utilized in the calculation.

The Company recognizes the cost of the equity awards over the period that services

are provided to earn the award, usually the vesting period.

For awards granted which contain a graded vesting schedule, and the only

condition for vesting is a service condition, compensation cost is recognized as an expense on a straight-line basis over the

requisite service period as if the award were, in substance, a single award.

The Company recognizes the impact of forfeitures and

cancellations in the period that the forfeiture and cancellations occurs, rather than estimating the number of awards that are not

Company measures the cost of employee and director services received in exchange for all equity awards granted, including stock options,

based on the fair market value of the award as of the grant date.

The Company computes the fair value of stock options using the Black-Scholes-Merton

(“BSM”) option pricing model.

The Company estimates the expected term using the simplified method which is the average of

the vesting term and the contractual term of the respective options.

The Company determines the expected price volatility based on the

historical volatilities of shares of the Company’s peer group as the Company does not have a sufficient trading history for its

Common Stock.

Industry peers consist of several public companies in the bio-tech industry similar to the Company in size, stage of life

cycle and financial leverage.

The Company intends to continue to consistently apply this process using the same or similar public companies

until a sufficient amount of historical information regarding the volatility of the Company’s own stock price becomes available,

or unless circumstances change such that the identified companies are no longer similar to the Company, in which case, more suitable

companies whose share prices are publicly available would be utilized in the calculation.

The Company recognizes the cost of the equity

awards over the period that services are provided to earn the award, usually the vesting period.

For awards granted which contain a graded

vesting schedule, and the only condition for vesting is a service condition, compensation cost is recognized as an expense on a straight-line

basis over the requisite service period as if the award were, in substance, a single award.

The Company recognizes the impact of forfeitures

and cancellations in the period that the forfeiture or cancellation occurs, rather than estimating the number of awards that are not

expected to vest in accounting for stock-based compensation.

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and enhancements to existing products.

Research and development costs incurred were less than $ 0.2 million for years ended December 31,

2022 and 2021.

Research and development costs incurred were less than $ 0.1 million and less than $ 0.2 million

for the years ended December 31, 2023 and 2022, respectively.

These are recorded on the statement of operations under general and administrative

leases are included in operating lease right-of-use (“ROU”) asset, accrued expenses, and operating lease liability - current

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of Common Stock, including stock options, convertible debt, Preferred Stock, and warrants, to the extent dilutive.

Company accounts for its warrants and financial instruments as either equity or liabilities based upon the characteristics and provisions

of each instrument, in accordance with ASC 815, Derivatives and Hedging .

Warrants classified as equity are recorded at fair value

as of the date of issuance on the Company’s consolidated balance sheets and no further adjustments to their valuation are made.

Warrants classified as liabilities and other financial instruments that require separate accounting as liabilities are recorded on the

Company’s consolidated balance sheets at their fair value on the date of issuance and will be revalued on each subsequent balance

sheet date until such instruments are exercised or expire, with any changes in the fair value between reporting periods recorded as other

income or expense.

Management estimates the fair value of these liabilities using the Black-Scholes model and assumptions that are based

on the individual characteristics of the warrants or instruments on the valuation date, as well as assumptions for future financings,

expected volatility, expected life, yield, and risk-free interest rate.

Segment Information

We manage our business within

one reportable segment.

The Company’s Chief Executive Officer, who is considered to be the chief operating decision maker (CODM), reviews

financial information presented on a consolidated basis, accompanied by information about operations for purposes of making operating

decisions and assessing financial performance.

Accounting Pronouncements

below is a discussion of new accounting standards including deadlines for adoption assuming that the Company retains its designation

Required to be Adopted in Future Years.

The following accounting standards are not yet effective as of December 31, 2022.

Adopted Standards.

The following recently issued accounting standards were adopted by the Company during the period ended December

June 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-13, Financial Instruments - Credit Losses

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of expected credit losses.

ASU 2016-13 is effective for the Company beginning in the first quarter of 2023.

The adoption of this standard

will not have a material impact on the Company’s consolidated financial statements.

accounting standards that have been issued or proposed by the FASB or other standards-setting bodies that do not require adoption until

a future date are not currently expected to have a material impact on the Company’s financial statements upon adoption.

Adopted Standards.

The following recently issued accounting standards were adopted by the Company during the year ended December

February 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-02, Leases (ASC 842).

This ASU requires the

Company to recognize lease assets and lease liabilities on the balance sheet and also disclose key information about leasing arrangements.

In July 2018, the FASB issued ASU No.

2018-11 Targeted Improvements , which provides lessees the option to adopt either (i) retrospectively

to each prior reporting period presented upon initial adoption, or (ii) apply the new leasing standard to all open leases as of the adoption

date by recognizing a cumulative-effect adjustment to accumulated deficit in the period of adoption without restating prior periods.

The Company adopted the new accounting standard on January 1, 2022, this adoption required the Company to recognize a current and long-term

lease liability of approximately of $ 1.9 million and a right-of-use (ROU) asset of approximately $ 1.2 million, while eliminating deferred rent of approximately $ 0.3 million and tenant improvement allowance of approximately

$ 0.4 million.

We applied the new lease standard to all open leases as of the adoption date, with no retrospective adjustments to prior comparative

December 2019, the FASB issued ASU 2019-12 , Income Taxes (Topic 740), Simplifying the Accounting for Income Taxes , which is intended

to simplify various aspects related to accounting for income taxes.

ASU 2019-12 removes certain exceptions to the general principles

in Topic 740 and clarifies and amends existing guidance to improve consistent application.

ASU 2019-12 was effective for the Company

beginning in the first quarter of 2022.

The adoption of this standard did not have a material impact on the Company’s consolidated

financial statements.

The Company adopted the new accounting standard on January 1, 2023.

The adoption of this standard did not

have a material impact on the Company’s consolidated financial statements.

2 - LIQUIDITY AND ABILITY TO CONTINUE AS A GOING CONCERN

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the Company as a going concern.

of December 31, 2022, the Company had an accumulated deficit of approximately $ 79.5 million.

As of December 31, 2022, the Company incurred

a net loss of approximately $ 23.8 million.

Net cash used in operating activities amounted to approximately $ 19.6 million for the year

ended December 31, 2022.

The Company has incurred losses since inception, including $ 13.6 and $ 23.8 million for the years ended

December 31, 2023 and 2022, respectively, resulting in an accumulated deficit of approximately $ 93.1 million as of December 31, 2023.

cash used in operating activities amounted to approximately $ 11.9 and $ 19.6 million for the years ended December 31, 2023 and 2022, respectively.

As of December 31, 2023, the Company had total liabilities of approximately $ 10.3 million.

of December 31, 2022, the Company had approximately $ 3.5 million in cash and cash equivalents, which may not be sufficient to fund the

operations and strategic objectives of the Company over the next twelve months from the date of issuance of these financial statements.

Without additional financing, these factors raise substantial doubt regarding the Company’s ability to continue as a going concern.

Company will be required to obtain additional financing and expects to satisfy its cash needs primarily from the issuance of equity securities

or indebtedness in order to sustain operations until it can achieve profitability and positive cash flows, if ever.

There can be no assurances,

however, that adequate additional funding will be available on favorable terms, or at all.

If such funds are not available in the future,

the Company may be required to delay, significantly modify or terminate its operations, all of which could have a material adverse effect

on the Company.

Company does not have any off-balance sheet arrangements, as defined by applicable regulations of the SEC, that are reasonably likely

to have a current or future material effect on our financial condition, results of operations, liquidity, capital expenditures or capital

of December 31, 2023, the Company had approximately $ 1.6 million in cash and cash equivalents, which will not be sufficient to fund operations

and strategic objectives over the next twelve months from the date of issuance of these financial statements.

Without additional financing,

these factors raise substantial doubt regarding the Company’s ability to continue as a going concern.

See Note 16 for additional

information regarding the Company’s financing activity following the period ended December 31, 2023.

a state of cash flow positivity is reached, management is reviewing all options to obtain additional financing to fund operations.

financing is expected to come primarily from the issuance of equity securities in order to sustain operations until the Company can achieve

profitability and positive cash flows, if ever.

There can be no assurances, however, that adequate additional funding will be available

on favorable terms, or at all.

If such funds are not available in the future, the Company may be required to delay, significantly modify

or terminate some or all of its operations, all of which could have a material adverse effect on the Company and stockholders.

3 - REVENUE, CONTRACT ASSETS AND CONTRACT LIABILITIES

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recognition is set forth in the table below (in thousands):

SCHEDULE OF REVENUE FROM CONTRACT WITH CUSTOMERS

Year Ended December 31,

OF REVENUE FROM CONTRACT WITH CUSTOMERS

Product revenue:

Appliance sales to VIPs

Center revenue

Total product revenue

Appliance sales

product revenue

Service revenue

Billing intelligence services

Management service revenue (includes MID)

Sleep testing services

Myofunctional therapy services

Sponsorship/seminar/other

Total service revenue

Total revenue

from the sale of products is typically fixed at inception of the contract and is recognized at the point in time when shipment of

the related products occurs.

from maintenance and subscription contracts is typically fixed at inception of the contract and is recognized ratably over time as

the services are performed and the performance obligations completed.

Revenue disclosed above for year ended December 31, 2022, includes

a cumulative adjustment from prior years of approximately $ 0.1 million increase.

disclosed above for the year ended December 31, 2022, includes a cumulative adjustment from prior years of approximately $ 0.4 million

service revenue

revenue from the sale of products is typically fixed at inception of the contract and is recognized at the point in time when shipment

of the related products occurs.

revenue disclosed above for the year ended December 31, 2022, includes a cumulative adjustment from prior years of approximately

$ 0.4 million decrease.

revenue from subscription contracts is typically fixed at inception of the contract and is recognized ratably over time as the services

are performed and the performance obligations completed.

Revenue disclosed above for year ended December 31, 2022, includes a cumulative

adjustment from prior years of approximately $ 0.1 million increase.

in Contract Liabilities

key components of changes in contract liabilities for the years ended December 31, 2023 and 2022 are as follows (in thousands):

SCHEDULE OF CONTRACT LIABILITY

OF CONTRACT LIABILITY

Beginning balance, January 1

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the period presented.

costs for product deliveries to customers are expensed as incurred and totaled approximately $ 0.1 million and $ 0.4 million for the years

ended December 31, 2022 and 2021, respectively.

Shipping costs for product deliveries to customers are included in cost of goods sold

in the accompanying consolidated statement of operations.

Additionally, revenue from breakage on contract liabilities was approximately $ 0.5 and $ 1.6 million for the years

ended December 31, 2023 and 2022.

in Accounts Receivable

customers are billed based on fees agreed upon in each customer contract.

Receivables from customers were $ 0.2 million at December 31,

2023, a decrease of $ 0.3 million from $ 0.5 million at December 31, 2022.

An allowance is maintained for accounts receivable which is

generally based on a combination of factors, including the aging of the receivables, historical collection trends, and charge-offs.

to the allowance are recorded in bad debt expense under general and administrative expenses in the consolidated statement of

An allowance of $ 0.3 and $ 0.7 million existed as of December 31, 2023 and 2022.

costs for product deliveries to customers are expensed as incurred and totaled approximately $ 0.2 million for the year ended December

31, 2023, and approximately $ 0.2 million for the year ended December 31, 2022.

Shipping costs for product deliveries to customers are

included in cost of goods sold in the accompanying consolidated statement of operations.

4 - PROPERTY AND EQUIPMENT, NET

of December 31, 2023 and 2022, property and equipment consist of the following (in thousands):

SCHEDULE OF PROPERTY AND EQUIPMENT

OF PROPERTY AND EQUIPMENT

Furniture and equipment

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Net Property and equipment

improvements relate to the Vivos Institute (the Company’s 15,000 square foot facility where the Company provides advanced post-graduate

education and certification to dentists, dental teams, and other healthcare professionals in a live and hands-on setting) and the two

Company-owned dental centers in Colorado.

Total depreciation and amortization expense was $ 0.6 million and $ 0.4 million for the years

ended December 31, 2022 and 2021, respectively.

improvements relate to the Vivos Institute (the Company’s 15,000

square foot facility where the Company provides advanced post-graduate education and certification to dentists, dental teams, and

other healthcare professionals in a live and hands-on setting) and the two Company-owned dental centers in Colorado.

depreciation and amortization expense was $ 0.7

and $ 0.6 million for the years ended December 31, 2023 and 2022, respectively.

5 - GOODWILL AND INTANGIBLE ASSETS

of $ 2.8 million as of December 31, 2023 and 2022, consist of the following acquisitions (in thousands):

SCHEDULE OF GOODWILL

Empowered Dental

Total goodwill

described in Note 1 above, on August 16, 2016, BioModeling entered into the SEA with First Vivos and Vivos.

The transaction was accounted

for as a reverse acquisition and recapitalization, with BioModeling as the acquirer for financial reporting and accounting purposes.

As a result of the transaction, we identified intangible assets of $ 2.1 million and goodwill (including the acquired workforce) of $ 2.6

million was recorded in accounting for the reverse acquisition.

November 2018, the Company entered into an asset purchase agreement with Empowered Dental Lab, LLC, a Utah limited liability company

(“Empowered Dental”), under which the Company agreed to purchase certain inventory and assets from Empowered Dental in exchange

for total consideration of $ 75,000 .

As a result of the transaction, goodwill of $ 52,000 was recognized in accounting for this transaction

as a business combination.

April 14, 2021, the Company acquired certain assets of Lyon Dental.

The business acquisition allowed the Company to expand and enhance

its current medical billing practice services under the name AireO2, which services are provided through the Company’s BIS offering.

The consideration transferred includes $ 0.2 million in cash and a warrant to purchase 25,000 shares of Common Stock at a price of $ 8.90

per share fair valued using a Black-Scholes Model as of April 14, 2021 for a total of $ 0.2 million, when combined the total consideration

exchanged is $ 0.4 million, the excess of the consideration transferred over the fair value of the acquired assets was allocated to goodwill.

of December 31, 2023 and 2022, identifiable intangible assets were as follows (in thousands):

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Net intangible assets

expense of identifiable intangible assets was less than $ 0.1 million and $ 0.3 million for the years ended December 31, 2022 and 2021,

respectively.

The estimated future amortization of identifiable intangible assets is as follows (in thousands):

expense of identifiable intangible assets was less than $ 0.1 million for the years ended December 31, 2023 and 2022.

The estimated future

amortization of identifiable intangible assets is as follows (in thousands):

SCHEDULE OF ESTIMATED FUTURE AMORTIZATION OF IDENTIFIABLE INTANGIBLE ASSETS

As of December 31,

of December 31,

6 - OTHER FINANCIAL INFORMATION

expenses consist of the following (in thousands):

of December 31, 2023 and 2022, accrued expenses consist of the following (in thousands):

SCHEDULE OF ACCRUED EXPENSES

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Total accrued expenses

May 8, 2020, the Company received approximately $ 1.3 million in loan funding through the PPP that was part of the Coronavirus Aid, Relief,

and Economic Security Act (the “CARES Act”) signed into law in March 2020.

The interest rate on the loan was 1.00 % per year

and was scheduled to mature on May 5, 2022 .

The Company used these funds to assist with payroll, rent and utilities.

On January 21, 2022,

the PPP loan was forgiven by the SBA in its entirety.

As a result, the Company recorded other income on the forgiveness of the loan in

the first quarter of 2022.

7 - PREFERRED STOCK

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As of December 31, 2023, the Company’s

Board of Directors has authority to designate up to an additional 50 million shares of Preferred Stock in various series that provide

Board of Directors continues to have the authority to designate up to 50,000,000 shares of Preferred Stock in various series that provide

for liquidation preferences, and voting, dividend, conversion, and redemption rights as determined at the discretion of the Board of

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The Company’s Board of Directors may declare dividends payable to the holders of Common Stock.

January 9, 2023, the Company closed a private placement (the “January 2023 Private Placement”) pursuant to which the Company

agreed to issue and sell 80,000 shares of Common Stock, Pre-Funded Warrants to purchase up to an aggregate of 186,667 shares of Common

Stock and Common Stock Purchase Warrants to purchase up to an aggregate of 266,667 shares of Common Stock for net proceeds of approximately

$ 7.4 million.

Issuance costs associated with the January 2023 Private Placement were approximately $ 0.6 million.

February 28, 2023, the Company acquired certain U.S.

and international patents, patent applications, trademarks, product rights, and

other miscellaneous intellectual property from AFD.

Pursuant to the asset acquisition the Company agreed to issue 10,000 shares of Common

Stock in addition to cash consideration of $ 50,000 .

As a result of this transaction the Company recorded intangible assets of approximately

$ 0.2 million.

As part of the Asset Purchase Agreement, the Company agreed to a future earnout payment consideration based on a sliding-scale

percentage on the volume of future sales, as well as a cash payment of $ 0.2 million upon the achievement of specified milestones.

the Company’s accounting policy, the contingent consideration obligation will be recorded as the contingency is resolved and the

consideration is paid or becomes payable.

addition, the Company entered into an employment agreement with Dr.

Scott Simonetti, DDS, the founder and Chief Executive Officer of

AFD, as part-time Senior Director of Research and Development for an annual salary of approximately $ 0.1 million and a five-year warrant

to purchase up to 16,000 shares of Common Stock with an exercise price of $ 15.25 per share;

provided, however, that the shares of Common

Stock underlying such warrant are subject to vesting only upon the achievement of specified milestones related to new FDA authorizations

for the intangible assets acquired.

disclosed above, on October 25, 2023 (the “Effective Date”), the Company effected a Reverse Stock Split of its outstanding

shares of common stock at a ratio of 1-for-25 .

As of the Effective Date, every twenty-five shares of the Company’s issued and outstanding

Common Stock was combined into one share of Common Stock.

As a result, the Company’s issued and outstanding Common Stock on the

Effective Date was proportionally reduced from approximately 29,928,786 shares to approximately 1,197,258 shares.

The ownership percentage

of each of the Company’s stockholders remained unchanged, other than as a result of fractional shares.

No fractional shares of

Common Stock were issued in connection with the Reverse Stock Split, and stockholders that would hold a fractional share of Common Stock

as a result of the Reverse Stock Split had such fractional shares of Common Stock rounded up to the nearest whole share of Common Stock.

November 2, 2023, the Company closed a private placement (the “November 2023 Private Placement”) with an institutional investor

pursuant to which the Company sold an aggregate of $ 4,000,003

of securities in a private placement consisting

of (i) 130,000

shares of Common Stock, (ii) a pre-funded warrant

to purchase 850,393

shares of Common Stock at an exercise price of

per share, (iii) a five-year Series A Common

Stock Purchase Warrant to purchase up to 980,393

shares of Common Stock with an exercise price

per share and (iii) an 18-month Series B Common

Stock Purchase Warrant (the “Series B Warrant”) to purchase up to 980,393 shares of Common Stock with an exercise

price of $ 3.83 per share.

Issuance costs associated with the November 2023 Private Placement were approximately $ 0.5 million.

14, 2024, the Company entered into a warrant inducement letter agreement (the “Inducement Agreement”) with the same institutional

investor in the November 2023 Private Placement pursuant to which the investor agreed to exercise for cash the entirety of the Series

B Warrant at an exercise price of $ 4.02 per share (with such exercise price being established for purposes of compliance with the listing

rules of the Nasdaq Stock Market), resulting in gross proceeds to the Company of approximately $ 4.0 million.

Pursuant to the Inducement

Agreement, in consideration for the immediate exercise of the Series B Warrant in full, the Company agreed to issue to the investor, in

a new private placement transaction (the “Inducement Transaction”):

(i) a 5-year, Series B-1 Common Stock Purchase Warrant

to purchase 735,296 shares of the Company’s common stock at an exercise price of $ 5.05 per share, and (ii) an 18-month, Series B-2

common stock purchase warrant to purchase 735,296 shares of our common stock at an exercise price of $ 5.05 per share (collectively, the

“Inducement Warrants” and such aggregate 1,470,592 shares of the Company’s common stock underlying the Inducement Warrants,

the “Inducement Warrant Shares”).

The Inducement Warrants are identical to each other, other than their dates of expiration,

and are substantially identical to the Series B Warrant.

number of shares of Common Stock available for issuance under the Company’s equity incentive plans and the Common Stock issuable

pursuant to outstanding equity awards and common stock purchase warrants immediately prior to the Reverse Stock Split were proportionately

adjusted by the ratio of the Reverse Stock Split.

The exercise prices of such outstanding options and warrants were also adjusted in

accordance with their respective terms.

The number of authorized shares of common stock was not affected by the Reverse Stock Split.

9 - STOCK OPTIONS AND WARRANTS

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The Company’s shareholders have

approved a total reserve of 1,333,333 million shares of Common Stock for issuance under the 2017 Plan.

approved a total reserve of 53,333 shares of Common Stock for issuance under the 2017 Plan.

April 2019, the Company’s shareholders approved the adoption of a stock and option award plan (the “2019 Plan”), under

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annual meeting of stockholders held in 2020 and 2021, the Company’s stockholders approved amendments to the 2019 Plan to increase

the number of shares of Common Stock available for issuance thereunder by an aggregate of 2,033,333 shares of Common Stock such that,

after such amendments, and prior to any grants, 2,366,667 shares of Common Stock were available for issuance.

the years ended December 31, 2022 and 2021, the Company issued stock options to purchase 1,974,168 and 969,000 shares of Common Stock

at a weighted average exercise price of $ 1.01 and $ 5.23 per share respectively, to certain members of the Board of Directors, employees

the number of shares of Common Stock available for issuance thereunder by an aggregate of 81,334 shares of Common Stock such that, after

such amendments, and prior to any grants, 94,667 shares of Common Stock were available for issuance.

September 22, 2023, stockholders approved an amendment to the Company’s 2019 Plan to increase the number of shares of Company common

stock authorized to be issued pursuant to the 2019 Plan by 80,000 shares from an aggregate of 94,667 shares to an aggregate of 174,667

the years ended December 31, 2023 and 2022, the Company issued stock options to purchase 16,000 and 78,967 shares of Common Stock at

a weighted average exercise price of $ 9.98 and $ 25.25 per share respectively, to certain members of the Board of Directors, employees

and consultants.

The stock options allow the holders to purchase shares of Common Stock at prices between $ 8.50 and $ 187.50 per share.

Options for the purchase of 1,206,348 shares of Common Stock expired as of December 31, 2022.

The following table summarizes all stock

options as of December 31, 2022 and 2021 (shares in thousands):

Options for the purchase of 33,553 and 48,254 shares of common stock expired as of December 31, 2023 and 2022, respectively.

The following

table summarizes all stock options as of December 31, 2023 and 2022 (shares in thousands):

SCHEDULE OF STOCK OPTIONS

Outstanding, beginning of year

Forfeited/cancelled

Outstanding, at December 31,

Outstanding, at December 31

Exercisable, at December 31

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the weighted average remaining contractual term until the stock options expire.

the respective exercise dates as of December 31, 2021, the aggregate intrinsic value of shares of Common Stock issued upon exercise

of stock options amounted to $ 0.6 million.

of December 31, 2022 and 2021, the aggregate intrinsic value of stock options outstanding was $ 0 .

of December 31, 2022 and 2021, the aggregate intrinsic value of exercisable stock options was $ 0 .

the years ended December 31, 2022, and 2021, the valuation assumptions for stock options granted under the 2019 Plan

were estimated on the date of grant using the BSM option-pricing model with the following weighted-average assumptions:

of December 31, 2023, and 2022 the aggregate intrinsic value of stock options outstanding was approximately $ 65,500 .

of December 31, 2023, and 2022 the aggregate intrinsic value of exercisable stock options was approximately $ 24,600 .

the year ended December 31, 2023 and 2022, the valuation assumptions for stock options granted under the 2017 Plan and the 2019 Plan were

estimated on the date of grant using the BSM option-pricing model with the following weighted-average assumptions:

SCHEDULE OF WEIGHTED AVERAGE ASSUMPTIONS USED IN THE FAIR VALUE

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Dividend yield

on the assumptions set forth above, the weighted-average grant date fair value per share for stock options granted for the year ended

on the assumptions set forth above, the weighted-average grant date fair value per share for stock options granted for the years ended

December 31, 2023 and 2022 was $ 9.89 and $ 25.25 , respectively.

the years ended December 31, 2022 and 2021, the Company recognized approximately $ 2.4 million and $ 2.7 million, respectively, of share-based

compensation expense relating to the vesting of stock options.

Unrecognized expense relating to these awards as of December 31, 2022

was approximately $ 3.0 million, which will be recognized over the weighted average remaining term of 4.1 years as of December 31, 2022.

the years ended December 31, 2023 and 2022, the Company recognized approximately $ 1.1

million, respectively, of share-based compensation expense relating to the vesting of stock options.

Unrecognized expense relating

to these awards as of December 31, 2023 and 2022 was approximately $ 1.8

million, respectively, which will be recognized over the weighted average remaining term of 3.7

years, respectively.

following table sets forth activity with respect to the Company’s warrants to purchase Common Stock for the years ended December

1 unchanged sentence

SCHEDULE OF WARRANT OUTSTANDING

Outstanding, beginning of year

Outstanding, at December 31

Grants of warrants:

Consultants for services

Acquisition of assets

Outstanding, December 31

Exercisable, December 31

Private placement

Outstanding, at December 31

Exercisable, at December 31

the weighted average exercise price.

the weighted average remaining contractual term until the warrants expire.

February, 2022, the Company granted warrants to consultants in exchange for marketing, business development, investor relations and

communication services.

Warrants issued in February 2022 provide for the purchase of an aggregate of 80,000 shares of Common Stock

and are exercisable at $ 3.27 per share.

The aggregate fair value of the February warrants amounted to $ 0.1 million which is being

recognized over the period that the services are provided.

In May, 2022, the Company granted warrants to consultants in exchange

for marketing and business development services.

Warrants issued in May 2022 provide for the purchase of an aggregate of 130,000

shares of Common Stock and are exercisable at $ 1.29 per share.

The aggregate fair value of the May warrants amounted to $ 0.1 million

which is being recognized over the period that the services are provided.

Warrants issued in December 2022 provide for the purchase

of an aggregate of 850,000 shares of Common Stock and are exercisable at $ 0.48 per share.

The aggregate fair value of the December

warrants amounted to $ 0.2 million which is being recognized over the period that the services are provided or according to the vesting

For the year ended December 31, 2022, the Company recognized expense of $ 0.7 million.

of December 31, 2022 and 2021, the aggregate intrinsic value of warrants outstanding was $ 0 .

of December 31, 2022 and 2021, the aggregate intrinsic value of warrants exercisable was $ 0 .

the year ended December 31, 2022, the valuation assumptions for warrants issued were estimated on the measurement date using the BSM

option-pricing model with the following weighted-average assumptions:

February 2023, the Company granted warrants to consultants in exchange for business development, product development and distribution.

Warrants issued in February 2023 provide for the purchase of an aggregate of 84,000 shares of common stock at an exercise price of

$ 22.75 and $ 15.25 per share with a fair value of approximately $ 1.3 million which will be recognized upon the achievement of performance

metrics and milestones.

In June 2023, the Company granted warrants to consultants in exchange for services.

Warrants issued in June

2023 provide for the purchase of an aggregate of 1,500 shares of common stock at an exercise price of $ 10.25 per share at a fair

value of approximately $ 0.1 million which will be recognized upon the achievement of performance metrics and milestones.

2023, the Company granted warrants to consultants in exchange for services.

Warrants issued in August 2023 provide for the purchase

of an aggregate of 900 shares of common stock at an exercise price of $ 8.50 per share at a fair value of approximately less than

$ 0.1 million which will be recognized per the vesting schedule.

For the years ended December 31, 2023 and 2022, the Company recognized

expense of $ 0.7 million, respectively.

January 2023, the Company granted warrants in connection with a private placement consisting of pre-funded warrants to purchase up

to an aggregate of 186,667 shares of common stock at an exercise price of $ 0.0001 per share, and warrants to purchase up to an aggregate

of 266,667 shares of common stock at an exercise price of $ 30 per share with a fair value of approximately $ 14.5 million which was

recognized as warrant liability at the time of issuance.

In November 2023, the Company amended the warrants to modify the provisions

that had required them to be previously classified as liabilities and enabled them to be classified as equity under the relevant

accounting standards (see note 14).

Additionally, in November 2023, the Company granted warrants in connection with a private placement

consisting of pre-funded warrants to purchase up to an aggregate of 850,393 shares of common stock at an exercise price of $ 0.0001

per share, and warrants to purchase up to an aggregate of 1,960,786 shares of common stock at an exercise price of $ 3.83 per share

with a relative fair value of approximately $ 3.8 million which was recorded to additional paid-in capital at the time of issuance.

March 2023, the Company issued an aggregate of 186,667 shares of common stock from the exercise of warrants previously issued in

January 2023.

In December 2023, the Company issued an aggregate of 437,393 shares of common stock from the exercise of warrants previously

issued in November 2023.

of December 31, 2023 and 2022, the aggregate intrinsic value of warrants outstanding was $ 19.2 million, and $ 0 , respectively.

of December 31, 2023 and 2022, the aggregate intrinsic value of warrants exercisable was $ 19.2 million, and $ 0 respectively.

the years ended December 31, 2023 and 2022, the valuation assumptions for warrants issued were estimated on the measurement date using

the BSM option-pricing model with the following weighted-average assumptions:

SCHEDULE OF WEIGHTED AVERAGE ASSUMPTIONS USED IN THE FAIR VALUE

Measurement date closing price of Common Stock (1)

Measurement date

closing price of Common Stock (1)

Contractual term (years) (2)

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average grant price.

valuation of warrants is based on the contractual term of the warrant rather than the expected term.

valuation of warrants is based on the expected term.

10 - RELATED PARTY TRANSACTIONS

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Loss before income taxes

the years ended December 31, 2022 and 2021, income tax expense (benefit) consists of the following (in thousands):

SCHEDULE OF INCOME TAX EXPENSE (BENEFIT)

Current income tax benefit (expense):

Total current income tax benefit (expense)

Deferred income tax benefit (expense):

Total deferred income tax benefit (expense)

Total income tax expense (benefit)

the years ended December 31, 2022 and 2021, income tax benefit differed from amounts that would result from applying the U.S.

income tax rate of 21.0% to the Company’s loss before income taxes as follows (in thousands):

OF INCOME TAX EXPENSE (BENEFIT) DIFFERED FROM LOSS BEFORE INCOME TAXE S

Income tax (benefit) computed at federal statutory rate

the years ended December 31, 2023 and 2022, , the Company did not recognize any current or deferred income tax expense due to a valuation

allowance against all of its net deferred income tax assets.

reconciliation between the income tax benefit computed by applying the statutory U.S.

federal income tax rate of 21% to the pre-tax loss,

and the income tax benefit recognized in the consolidated financial statements is as follows for the years ended December 31, 2023 and

2022 (in thousands):

OF INCOME TAX EXPENSE (BENEFIT) DIFFERED FROM LOSS BEFORE INCOME TAXES

Income tax (benefit) computed at

federal statutory rate

PPP loan forgiveness

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State tax expenses

Prior year adjustment to state NOL

Prior year adjustment to state net operating

loss carryforward

Nontaxable gain on change in fair value of

warrants, net of issuance costs

Non-qualified stock option cancellations

Change in valuation allowance

Change in valuation

Total income tax benefit

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Property, equipment and intangibles

Total deferred tax assets before valuation allowance

Total deferred tax assets before valuation

Valuation allowance

Total deferred income tax assets after valuation allowance

Total deferred income

tax assets after valuation allowance

Deferred tax liabilities:

Property, equipment and intangibles

Total deferred income tax liabilities

Net deferred tax assets and liabilities

assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to use the

existing deferred tax assets.

A significant piece of objective negative evidence evaluated was the cumulative loss incurred since

Such objective evidence limits the ability to consider other subjective evidence such as our projections for future

On the basis of this evaluation, as of December 31, 2022, a valuation allowance of $ 15.6

million has been recorded to record the deferred tax asset that is more likely than not to be realized.

The net change during the

year in the total valuation allowance is an increase of $ 4.8

Company has federal net operating loss carry forwards of $ 58.2 million.

The Company also has various state net operating loss carry forwards.

The determination of the state net operating loss carry forwards is dependent upon the apportionment percentages and state laws that

can change from year to year and impact the amount of such carry forwards.

If federal net operating loss carry forwards are not utilized,

approximately $ 3.3 million will begin to expire in 2036 .

As of December 31, 2022, the remaining federal net operating losses of $ 54.8

million have no expiration dates.

and state laws impose substantial restrictions on the utilization of net operating loss (“NOL”) carryforwards in the event

of an ownership change for income tax purposes, as defined in Section 382 of the Internal Revenue Code (“IRC”).

to IRC Section 382, annual use of the Company’s NOL carryforwards may be limited in the event a cumulative change in ownership

of more than 50% occurs within a three-year period.

The Company has not completed an IRC Section 382 analysis regarding the limitation

of NOL carryforwards.

However, it is possible that past ownership changes will result in the inability to utilize a significant portion

of the Company’s NOL carryforward that was generated prior to any change of control.

The Company’s ability to use its remaining

NOL carryforwards may be further limited if the Company experiences an IRC Section 382 ownership change in connection with future changes

in the Company’s stock ownership.

does not believe that there are significant uncertain tax positions related to the 2022 and 2021 taxable periods.

There are no interest

and penalties related to uncertain tax positions for the years ended December 31, 2022 and 2021.

Total deferred income

tax liabilities

Net deferred tax assets

and liabilities

assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to use the existing

deferred tax assets.

A significant piece of objective negative evidence evaluated was the cumulative loss incurred since inception.

objective evidence limits the ability to consider other subjective evidence such as our projections for future growth.

On the basis of

this evaluation, as of December 31, 2023, a valuation allowance of $ 19.3 million has been recorded to record the deferred tax asset that

is more likely than not to be realized.

For the years ended December 31, 2023 and 2022, the valuation allowance increased by $ 3.7 million

and $ 4.8 million, respectively.

of December 31, 2023, the Company has federal net operating loss (“NOL”) carryforwards of $ 72.4 million.

The Company also

has various state NOL carry forwards.

The determination of the state NOL carryforwards is dependent upon the apportionment percentages

and state laws that can change from year to year and impact the amount of such carryforwards.

If federal NOL carryforwards are not utilized,

approximately $ 3.3 million will expire in 2036 and 2037.

As of December 31, 2023, the remaining federal NOL carryforward of $ 69.1 million

has no expiration date.

and state laws impose substantial restrictions on the utilization of NOL carryforwards if the Company experiences significant ownership

changes as defined in Section 382 of the Internal Revenue Code (“IRC”).

Pursuant to IRC Section 382, annual use of the Company’s

NOL carryforwards may be limited in the event a cumulative change in ownership of more than 50% among 5% or greater shareholders (or

shareholder groups) over any three-year period.

The Company is not currently utilizing its federal and state NOL carryforwards and has

not completed a formal study to determine if any past ownership changes may have triggered limitations under IRC Section 382..

The Company’s

ability to use its remaining NOL carryforwards may be further limited if the Company experiences an IRC Section 382 ownership change

in connection with future changes in the Company’s stock ownership.

does not believe there are any significant uncertain tax positions as of and for the years ended December 31, 2023 and 2022.

no interest and penalties related to uncertain tax positions have been recognized for the years ended December 31, 2023 and 2022.

Company files income tax returns in the United States federal and various state jurisdictions.

17 unchanged sentences

uncertainty about whether the Orders will be reinstated should a new COVID-19 variant or entirely new virus emerge.

Our business was materially impacted by COVID-19 in 2020 and to some extent

in 2021due to the actions of governmental bodies that mandated quarantines and lockdowns that resulted in many of our VIPs and potential

VIPs having to close their offices.

The impact of COVID-19 on our business diminished somewhat as 2022 progressed.

However, it appears

that the latest COVID-19 subvariants evoke generally milder symptoms and do not pose the same health or economic threat as previous strains.

However, the residual effects of the pandemic on dental workforce availability as well as patient precautionary measures continued to

negatively impact our VIP dental practices and our revenue across the U.S.

and Canada during 2022.

We believe new enrollments during the

fourth quarter of 2022 were negatively impacted by the ongoing overall workforce uncertainties in the dental market.

As such, the long-term

financial impact on our business of COVID-19 as well as these other matters cannot reasonably be fully estimated at this time.

such, the long-term financial impact on our business of COVID-19 as well as these other matters cannot reasonably be fully estimated

at this time.

and War in Ukraine

Company believes the U.S.

has entered a period of inflation which has increased (and may continue to increase) the Company and its suppliers’

costs as well as the end cost of the Company’s products to consumers.

To date, the Company been able to manage inflation risk without

a material adverse impact on its business or results of operations.

However, inflationary pressures (including increases in the price

of raw material components of the Company’s appliances) made it necessary for the Company to adjust its standard pricing for its

appliance products effective May 1, 2022.

The full impact of such price adjustments on sales or demand for the Company’s products

is not fully known at this time and may require the Company to adjust other aspects of its business as it seek to grow revenue and, ultimately,

achieve profitability and positive cash flow from operations.

addition, worldwide supply chain constraints due in part to Russia’s invasion of Ukraine in February 2022, have emerged as new

barriers to long-term economic recovery.

business was materially impacted by COVID-19 in 2020 and to some extent thereafter and through the early part of 2023 due to the actions

of governmental bodies that mandated quarantines and lockdowns that resulted in many of our VIPs and potential VIPs having to close their

The impact of COVID-19 on our business diminished somewhat as 2023 has progressed.

However, it appears that the latest COVID-19

subvariants evoke generally milder symptoms and do not pose the same health or economic threat as previous strains.

However, the residual

effects of the pandemic on dental workforce availability as well as patient precautionary measures continued to negatively impact our

VIP dental practices and our revenue across the U.S.

and Canada during 2022 and into 2023.

We believe new enrollments during 2023 continue

to be negatively impacted by the ongoing overall workforce uncertainties in the dental market.

In addition, new variants of COVID-19

continue to arise, and such variants may in the future cause an adverse effect on the dental market.

As such, the long-term financial

impact on our business of COVID-19 as well as these other matters cannot reasonably be fully estimated at this time.

Inflation, the War in Ukraine and Middle East

Company believes that as the U.S.

experiences a period of inflation, which has increased (and may continue to increase), the Company

and its suppliers’ costs as well as the end cost of the Company’s products to consumers may also increase.

The worldwide

supply chain constraints and economic and capital markets uncertainty arising out of Russia’s invasion of Ukraine in February

2022 and Hamas attacks on Israel in October of 2023 and Israel’s response have emerged as new barriers to long-term economic

If an economic recession or depression commences and is sustained, it could have a material adverse effect on our business

as demand for our products could decrease.

To date, the Company has been able to manage inflation risk without a material adverse

impact on its business or results of operations, and inflation has begun to abate somewhat during 2023.

However, inflationary

pressures (including increases in the price of raw material components of the Company’s appliances) made it necessary for the

Company to adjust its standard pricing for its appliance products effective May 1, 2022.

The full impact of such price adjustments

on sales or demand for the Company’s products is not fully known at this time and may require the Company to adjust other

aspects of its business as it seeks to grow revenue and, ultimately, achieve profitability and positive cash flow from

additional inflation-related risk is the Federal Reserve’s response, which up to this point has been to raise interest rates.

actions have, in times past, created unintended consequences in terms of the impact on housing starts, overall manufacturing, capital

markets, and banking.

If such disruptions become systemic, like in the recession of 2008, then the impact on the Company’s revenue,

earnings potential and access to capital of both inflation and inflation-fighting responses would be impossible to know or calculate.

conditions could cause an economic recession or depression to commence, and if such recession or depression is sustained, it could have

a material adverse effect on the Company business as demand for its products could decrease.

Such conditions have also had, and may continue

to have, an adverse effect on the capital markets, with public stock price decreases and volatility, which could make it more difficult

for the Company to raise needed capital at the appropriate time.

a material adverse effect on the Company’s business as demand for its products could decrease.

Such conditions have also had, and

may continue to have, an adverse effect on the capital markets, with public stock price decreases and volatility, which could make it

more difficult for the Company to raise needed capital at the appropriate time.

Company has entered into various operating lease agreements for certain offices, medical facilities and training facilities.

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not to include options to extend the lease until it is reasonably certain that the Company will exercise that option.

January 2017, the Company entered into a commercial lease agreement for 2,220 square feet of office in Johnstown, CO that was to commence

on March 1, 2018 and end February 28, 2025.

As of January 1, 2022, the Company recorded an operating lease right of use asset and lease

liabilities of $ 0.3 million in the consolidated balance sheet representing the present value of minimum lease payments using the Company’s

incremental borrowing rate of 6.0 %.

May 2018, the Company entered into a commercial lease agreement for 3,643 square feet of office in Highlands Ranch, CO that was to commence

on November 1, 2018 and end on January 1, 2029.

As of January 1, 2022, the Company recorded an operating lease right of use asset and

lease liabilities of $ 0.8 million in the consolidated balance sheet representing the present value of minimum lease payments using the

Company’s incremental borrowing rate of 7.3 %.

January 2017, the Company entered into a commercial lease agreement for 2,220 square feet of office in Johnstown, Colorado that was to

commence on March 1, 2018 and end February 28, 2025.

As of January 1, 2022, the Company recorded an operating lease right of use asset

and lease liabilities of $ 0.3 million in the consolidated balance sheet representing the present value of minimum lease payments using

the Company’s incremental borrowing rate of 6.0 %.

May 2018, the Company entered into a commercial lease agreement for 3,643 square feet of office in Highlands Ranch, Colorado that was

to commence on November 1, 2018 and end on January 1, 2029.

As of January 1, 2022, the Company recorded an operating lease right of use

asset and lease liabilities of $ 0.8 million in the consolidated balance sheet representing the present value of minimum lease payments

using the Company’s incremental borrowing rate of 7.3 %.

October 2020, the Company entered into a commercial lease agreement for 4,800 square feet of office in Orem, Utah that was to commence

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Company’s incremental borrowing rate of 6.6 %.

April 2019, the Company entered into a commercial lease agreement for 3,231 square feet of office in Highlands Ranch, CO that was to

commence on May 1, 2019 and end on May 31, 2022.

As of January 1, 2022, the Company recorded an operating lease right of use asset and

lease liabilities of less than $ 0.1 million in the consolidated balance sheet representing the present value of minimum lease payments

using the Company’s incremental borrowing rate of 6.7 %.

April 2019, the Company entered into a commercial lease agreement for 14,732 square feet of office in Denver, CO that was to commence

on September 23, 2020 and end on March 22, 2028.

As of January 1, 2022, the Company recorded an operating lease right of use asset and

lease liabilities of less than $ 1.4 million in the consolidated balance sheet representing the present value of minimum lease payments

April 2019, the Company entered into a commercial lease agreement for 3,231 square feet of office in Highlands Ranch, Colorado that was

to commence on May 1, 2019 and end on May 31, 2022.

As of January 1, 2022, the Company recorded an operating lease right of use asset

and lease liabilities of less than $ 0.1 million in the consolidated balance sheet representing the present value of minimum lease payments

using the Company’s incremental borrowing rate of 6.7 %.

April 2022, the Company entered into a commercial lease agreement for 8,253 square feet of office in Littleton, CO that was to commence

in May 16, 2022 and end on November 15, 2027.

As of May 16, 2022, the Company recorded an operating lease right of use asset and lease

liabilities of less than $ 1.5 million in the consolidated balance sheet representing the present value of minimum lease payments using

the Company’s incremental borrowing rate of 10.6 %.

April 2019, the Company entered into a commercial lease agreement for 14,732 square feet of office space for its former corporate headquarters

in Denver, Colorado that was to commence on September 23, 2020 and end on March 22, 2028.

As of January 1, 2022, the Company recorded

an operating lease right of use asset and lease liabilities of less than $ 1.4 million in the consolidated balance sheet representing

the present value of minimum lease payments using the Company’s incremental borrowing rate of 7.1 %.

April 2022, the Company entered into a commercial lease agreement for 8,253 square feet of office space for its corporate headquarters

in Littleton, Colorado that commenced May 16, 2022 and ends on November 15, 2027.

As of May 16, 2022, the Company recorded an operating

lease right of use asset and lease liabilities of less than $ 1.5 million in the consolidated balance sheet representing the present value

of minimum lease payments using the Company’s incremental borrowing rate of 10.6 %.

of December 31, 2023 and 2022, the components of lease expense are as follows (in thousands):

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expense is recognized on a straight-line basis over the lease term.

Lease expense, including real estate taxes and related costs, for the years

ended December 31, 2022 and 2021 aggregated approximately $ 0.5

million, and $ 0.6

million respectively.

This is included under general and administrative expense.

of December 31, 2022, the remaining lease terms and discount rate used are as follows (in thousands):

Lease expense, including real estate taxes and related costs for

the years ended December 31, 2023 and 2022 aggregated approximately $ 0.5 million, respectively.

This is included under general and administrative

of December 31, 2023 and 2022, the remaining lease terms and discount rate used are as follows (in thousands):

OF REMAINING LEASE TERMS AND DISCOUNT RATE

Weighted-average remaining lease term (years)

Weighted-average remaining lease

Weighted-average discount rate

cash flow information related to leases as of December 31, 2022 is as follows (in thousands):

cash flow information related to leases as of December 31, 2023 and 2022 is as follows (in thousands):

RELATED TO LEASES

flow classification of lease payments:

cash flows from operating leases

of December 31, 2022, the maturities of the Company’s future minimum lease payments were as follows (in thousands):

Cash flow classification

of lease payments:

Operating cash

flows from operating leases

of December 31, 2023 and 2022, the maturities of the Company’s future minimum lease payments were as follows (in thousands):

SCHEDULE OF FUTURE MINIMUM LEASE PAYMENTS

As of December 31,

of December 31,

Total lease payments

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Calculation of Numerator:

Loss applicable to common stockholders

applicable to common stockholders

Calculation of Denominator:

Weighted average number of shares of Common Stock outstanding

Net loss per share of Common Stock (basic and diluted)

Weighted average number

of shares of Common Stock outstanding

loss per share of Common Stock (basic and diluted)

of December 31, 2023 and 2022, the following potential Common Stock equivalents were excluded from the computation of diluted net loss

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of December 31, 2023 and 2022, the fair value of the Company’s cash and cash equivalents, accounts receivable, accounts payable,

and accrued liabilities approximated their carrying values due to the short-term nature of these instruments.

and other accrued liabilities approximated their carrying values due to the short-term nature of these instruments.

discussed in Note 8, on January 9, 2023, the Company closed on the Private Placement for the sale by the Company of shares of the Company’s

common stock and the issuance of pre-funded warrant to purchase up to an aggregate of 186,667 shares of common stock at an exercise price

of $ 0.0001 per share, and the issuance of warrant to purchase up to an aggregate of 266,667 shares of common stock at an exercise price

of $ 30 per share.

The warrants are initially exercisable commencing January 9, 2023 through their expiration date of July 9, 2028.

addition, as part of the November 2023 Private Placement, we agreed to amend the existing outstanding common stock purchase warrant held

by the purchaser and issued in January 2023 to purchase up to an aggregate of 266,667 shares of Common Stock at an exercise price of

$ 30.00 per share with an expiration date of July 5, 2028.

Such amendment, which became effective upon the closing of the November 2023

Private Placement, reduced the exercise price of the January warrant to $ 3.83 per share and extended the expiration date of such warrant

to November 2, 2028 .

The amendment also restated in its entirety the definition of “Black Scholes Value” contained in the

January warrant which resulted in the classification of the warrant from liability to equity.

The liability associated with those warrants

was initially recorded at fair value in the Company’s consolidated balance sheet upon issuance, and subsequently re-measured as

of March 31, 2023, June 30, 2023, September 30, 2023, and November 2, 2023 when the November 2023 Private Placement closed.

in the fair value between issuance, the March 31, 2023 measurement date, the June 30, 2023 measurement date, the September 30, 2023,

and the November 2, 2023 measurement date are recorded as a component of other income (expense), in the consolidated statement of operations.

Fair Value Measurements

the years ended December 31, 2022 and 2021, the Company did not have any recurring measurements for the fair value of assets and liabilities.

the years ended December 31, 2023 and 2022, the Company did not have any assets and liabilities classified as Level 1, Level 2 or Level

The Company has concluded that the warrants issued in connection with the private placement, met the definition of a liability under

ASC 480, Distinguishing Liabilities from Equity and has classified the liability as Level 3.

following table represent a reconciliation of the Company’s liabilities measured at fair value on a recurring basis using significant

unobservable inputs (Level 3) for the year ended December 31, 2023:

SCHEDULE OF FAIR VALUE LIABILITIES ON RECURRING BASIS

Beginning balance, January 1

Issuance of warrants

Exercise of warrants

Change in fair value upon re-measurement

Reclassification of

warrant liabilities to additional paid-in-capital

Ending balance, December

Company has re-measured the liability to estimate fair value at November 2, 2023 as a result of the amendment described above, using

the Black-Scholes option pricing model with the following assumptions:

SCHEDULE OF FAIR VALUE PRICING MODEL

Measurement date

closing price of Common Stock (1)

Contractual term (years) (2)

Risk-free interest rate

Dividend yield

on the trading value of common stock of Vivos Therapeutics, Inc.

as of January 9, 2023 and each presented period ending date.

valuation of warrants is based on the expected term.

Company’s policy is to recognize asset or liability transfers among Level 1, Level 2 and Level 3 as of the actual date of the events

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Concentrations

instruments that subject the Company to concentrations of credit risk consist primarily of cash, cash equivalents, restricted cash, and

accounts receivable.

The Company maintains its cash, cash equivalents and restricted cash at high-quality financial institutions.

deposits, including those held in foreign branches of global banks, may exceed the amount of insurance provided on such deposits.

of December 31, 2022, the Company had cash and cash equivalents with two financial institutions in the United States with an aggregate

balance of $ 3.5 million.

As of December 31, 2021, the Company had cash and cash equivalents with two financial institutions in the United

States with an aggregate balance of $ 24.0 million.

The Company has never experienced any losses related to its investments in cash, cash

equivalents and restricted cash.

instruments that potentially expose the Company to concentrations of credit risk consist principally of cash and cash equivalents on

deposit with financial institutions, the balances of which frequently exceed federally insured limits.

Management monitors the soundness

of these financial institutions and believes the Company’s risk is negligible.

The Company has not experienced any losses in such

If any of the financial institutions with whom the Company does business was to be placed into receivership, the Company may

be unable to access the cash they have on deposit with such institutions.

If the Company were unable to access cash and cash equivalents

as needed, the financial position and ability to operate the business could be adversely affected.

As of December 31, 2023, the Company

had cash and cash equivalents with three financial institutions in the United States with an aggregate balance of $ 1.6 million.

credit risk with respect to accounts receivable is diversified due to the number of entities comprising the Company’s customer

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and generally does not require collateral on accounts receivable.

No single customer represented more than 10% of our accounts receivable

as of December 31, 2023.

The Company maintains reserves for potential bad debts.

Concentration

previously disclosed, the Company relies on third-party suppliers and contract manufacturers for the raw materials and components used

in our appliances and to manufacture and assemble our products.

As of December 31, 2023, the Company had five suppliers that accounted

for approximately 80 % of the Company’s total purchases during the year.

The Company expects to maintain existing relationships

with these vendors.

15 – SUBSEQUENT EVENTS

2023 Private Placement

January 5, 2023, we entered into a Securities Purchase Agreement (“Purchase Agreement”) with an institutional investor (who

is the selling stockholder named herein) pursuant to which we agreed sell up to an aggregate of $ 8,000,000 of our securities in a private

placement consisting of 2,000,000 shares of our Common Stock, a pre-funded warrant to purchase up to an aggregate of 4,666,667 shares

of our Common Stock and a Common Stock purchase warrant to purchase up to an aggregate of 6,666,667 shares of our Common Stock (as the

context requires, we sometimes refer to the pre-funded warrant and the Common Stock purchase warrant issued in our January 2023 private

placement as the “warrants”).

The purchase price per share and associated Common Stock purchase warrant was $ 1.20 , and the

purchase price per pre-funded warrant and associated Common Stock purchase warrant was $ 1.1999 .

private placement closed on January 9, 2023.

After the placement agent fees and estimated offering expenses payable by us, we received

net proceeds of approximately $ 7.4 million.

We intend to use the net proceeds from the private placement for general working capital

October 30, 2023, the Company entered into a Securities Purchase Agreement with an institutional investor (the “Holder”)

pursuant to which the Company sold an aggregate of approximately $ 4.0 million of securities of the Company in a private placement, such

securities consisting of shares of the Company’s common stock, par value $ 0.0001 (or, in lieu of a Share, a pre-funded warrant

to purchase one share of Common Stock), (ii) a Series A Warrant to purchase up to 980,393 shares of Common Stock and (iii) a Series B

Warrant to purchase up to 980,393 shares of Common Stock with an exercise price of $ 3.83 per share.

The private placement closed on November

As of January 31, 2024, all of the pre-funded warrants granted as part of the private placement were exercised.

February 14, 2024, the Company entered into a warrant inducement letter agreement (the “Inducement Agreement”) with the Holder

pursuant to which the Holder agreed to exercise for cash the entirety of the Series B Warrant at an exercise price of $ 4.02

per share (with such exercise price being established

for purposes of compliance with the listing rules of the Nasdaq Stock Market), resulting in gross proceeds to the Company of approximately

The resale of the shares of Common Stock

underlying the Series B Warrant has been registered pursuant to a Registration Statement on Form S-1 (File No.

333-275726), which became

effective with the Securities and Exchange Commission (“SEC”) on December 1, 2023.

to the Inducement Agreement, in consideration for the immediate exercise of the Series B Warrant in full, the Company agreed to issue

to the Holder, in a new private placement transaction (the “Inducement Transaction”):

(i) a 5-year, Series B-1 Common Stock

Purchase Warrant to purchase 735,296 shares of Common Stock at an exercise price of $ 5.05 per share, and (ii) an 18-month, Series B-2

Common Stock Purchase Warrant to purchase 735,296 shares of Common Stock at an exercise price of $ 5.05 per share (collectively, the “Inducement

Warrants” and such aggregate 1,470,592 shares of Common Stock underlying the Inducement Warrants, the “Inducement Warrant

The Inducement Warrants are identical to each other, other than their dates of expiration, and are substantially identical

to the Series B Warrant.

Inducement Transaction closed on February 20, 2024.

The Company intends to use the net proceeds received for general working capital

and general corporate purposes.

Common Stock purchase warrant entitles the holder, for a period of five years and 6 months, to purchase one share of Common Stock at

an exercise price of $1.20 per share.

The pre-funded warrant entitles the holder, for a period until the entirety of the pre-funded warrant

is exercised, to purchase one share of Common Stock at an exercise price of $0.0001 per share.

Both warrants contain a customary 4.99 %

beneficial ownership limitation that may be waived at the option of the holder upon 61 days’ notice to us.

Purchase Agreement includes standard representations, warranties and covenants.

In addition, and subject to customary exceptions, the

Purchase Agreement provides that:

from January 5, 2023 until ninety (90) days after the effective date of the registration statement, neither our company nor any subsidiary

of our company shall (i) issue, enter into any agreement to issue or announce the issuance or proposed issuance of any shares of Common

Stock or securities convertible into or exercisable for Common Stock or (ii) file any registration statement or any amendment or supplement

thereto, in each case other than as contemplated by the Registration Rights Agreement (as defined below);

from January 5, 2023 until nine (9) months after the effective date of the registration statement, we shall be prohibited from effecting

or entering into an agreement to effect any issuance by us or any of our subsidiaries of any shares of Common Stock or securities convertible

into or exercisable for Common Stock (or a combination of units thereof) involving a “variable rate transaction”, meaning

a transaction in which we (i) issue or sell any debt or equity securities that are convertible into, exchangeable or exercisable for,

or include the right to receive, additional shares of Common Stock either (i) at a conversion price, exercise price or exchange rate

or other price that is based upon, and/or varies with, the trading prices of or quotations for the shares of Common Stock at any time

after the initial issuance of such debt or equity securities or (ii) with a conversion, exercise or exchange price that is subject to

being reset at some future date after the initial issuance of such debt or equity security or upon the occurrence of specified or contingent

events directly or indirectly related to our business or the market for the Common Stock or (ii) enter into, or effect a transaction

under, any agreement, including, but not limited to, an equity line of credit, whereby we may issue securities at a future determined

January 5, 2023, in connection with the private placement, we entered into a registration rights agreement (the “Registration Rights

Agreement”) with the investor, pursuant to which we agreed to file a registration statement with the SEC to register for resale

the shares issued in the private placement and the shares of Common Stock issuable upon exercise of the warrants.

We is subject to customary

penalties and liquidated damages in the event we does not meet certain filing and effectiveness deadlines set forth in the Registration

Rights Agreement, up to a maximum aggregate penalty of 10.5 % of the gross proceeds of the private placement.

We have filed a registration

statement in order to satisfy our obligations under the Registration Rights Agreement.

Capital Partners, LLC and A.G.P./Alliance Global Partners acted as placement agents for the Private Placement (the “Placement Agents”).

Pursuant to a placement agency agreement, dated January 5, 2023, between us and the Placement Agents (the “Placement Agency Agreement”),

we agreed to pay the Placement Agent a cash fee equal to 6.0 % of the gross proceeds received by us in the private placement, in addition

to the reimbursement of $ 40,000 of expenses.

The Placement Agency Agreement contains customary representations, warranties, terms and

conditions, including for indemnification of the Placement Agents and their related parties by us.

2023 Asset Purchase

February 28, 2023, the Company entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”) with Advanced Facialdontics,

LLC, a New York limited liability company (“AFD”), pursuant to which the Company acquired certain

and international patents, trademarks, product rights, and other miscellaneous intellectual property from AFD (the “Acquired

flagship product, the Preventive Oral Device ® , known as the POD ® (the “POD”), is a custom single

arch device with an FDA 510(k) clearance for treating an estimated 40 million patients in the U.S.

and Canada with Temporomandibular

Joint Dysfunction (“TMD”) and/or Bruxism (teeth grinding or clenching), both known to be closely associated with OSA .

The Company’s primary existing products are used by dentists to treat mild to moderate OSA.

second FDA 510(k) cleared product, known as the Night Block™, is a custom dual-arch mandibular advancement oral appliance that

incorporates patented unilateral bite block technology, which can alleviate or eliminate many of the downsides of traditional oral appliance

treatment such as inflammation of the TMJ, facial pain, neck pain, headaches, tension, fatigue, clenching, and grinding.

acquisition of these novel technologies, patent portfolio, related trademarks, and product rights further enhance the Company’s

existing intellectual property and technology base, enabling the Company to provide new, complementary products to many OSA patients

who experience pain, discomfort, headaches, tooth loss, and other symptoms associated with TMD and Bruxism.

addition, this acquisition will provide dentists and other healthcare professional who use the Company’s existing products with

an additional treatment option for patients who do not have OSA, but suffer from jaw pain, headaches, and daytime fatigue.

expects to be able to manufacture the AFD products through existing manufacturing relationships.

of the Asset Purchase Agreement

to the terms of the Asset Purchase Agreement, the Company provided the following consideration for the Acquired Assets:

$ 50,000 in cash;

250,000 shares of unregistered Common Stock;

cash earnout payments based on sliding-scale percentages (from low double digits to low single digits) based on the volume of future

sales of POD devices;

additional cash earnout payments based on different sliding-scale percentages (from low double digits to mid-single digits) based on

the volume of future sales of non-POD devices developed by the Company utilizing the Acquired Assets;

a mid-single digit royalty on revenue received from licensing the Acquired Assets to third parties, including low five-digit quarterly

minimum royalties starting in 2024;

cash milestone payments of up to $ 225,000 in the aggregate, based upon the achievement of specified milestones related to new FDA authorizations

for the Acquired Assets;

a five-year warrant to purchase up to 400,000 shares of Common Stock with an exercise price of $0.61 per share;

provided, however, that

the shares of Common Stock underlying such warrant are subject to vesting only upon the achievement of specified milestones related to

new FDA authorizations for the Acquired Assets.

addition, Dr.

Scott Simonetti, DDS, the founder and Chief Executive Officer of AFD, has been hired as the Company’s part-time Senior

Director of Research and Development for an annual salary of $ 96,000 .

terms of the Inducement Agreement require the Company to file a registration statement registering the Inducement Warrant Shares for

resale (“Resale Registration Statement”) no later than April 5, 2024 and to use commercially reasonable best efforts to cause

the Resale Registration Statement to be effective within 60 calendar days following the filing.

Company further agreed that until forty-five (45) days after the closing date of the Inducement Transaction, it will not (other than

in connection with limited enumerated exceptions) issue, enter into any agreement to issue or announce the issuance or proposed issuance

of any shares of Common Stock or Common Stock equivalents or file any registration statement or any amendment or supplement (other than

the Resale Registration Statement).

The Company is further prohibited from entering into any “variable rate transaction”

for a period of six months from the effective date of the Resale Registration Statement.

Inducement Warrants contain (i) customary stock-based anti-dilution protection, (ii) a cashless

exercise provision in the event the Inducement Warrant Shares are not registered for resale at the time of exercise, (iii) beneficial

ownership limitations that may be waived at the option of the Holder upon 61 days’ notice to the Company, (iv) a put right granting

the Holder the right to require the Company or its successor to redeem the Inducement Warrants in cash for their Black-Scholes value

in the event of a Fundamental Transaction (as defined in the Inducement Warrants) and (v) other customary provisions for warrants of

Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.

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-K

Item 8. Financial Statements and Supplementary Data