What changed in this filing

/stocks — the workspaceLOADING

Item 7. Management’s Discussion and Analysis

2026-04-15 compared with 2025-03-31 · 327 added, 404 removed, 281 unchanged (72% of the section changed)

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Risk Factors’’ and elsewhere in this Annual Report on Form 10-K.

are a revenue stage medical technology company focused on the development and commercialization of innovative treatment alternatives

for patients with dentofacial abnormalities and/or patients diagnosed with mild to severe obstructive sleep apnea (“OSA”)

and snoring in adults.

We believe our technologies and conventions represent a significant improvement in the treatment of mild to severe

OSA versus other treatments such as continuous positive airway pressure (“CPAP”) or palliative oral appliance therapies.

Our alternative treatments are part of The Vivos Method .

are a revenue stage medical technology and healthcare services company focused on the development and commercialization of innovative

treatment alternatives for patients with dentofacial abnormalities and/or patients diagnosed with mild to severe obstructive sleep apnea

(“ OSA ”) and snoring in adults.

We believe our technologies and conventions represent a significant improvement in

the treatment of mild to severe OSA versus other treatments such as CPAP or palliative oral appliance therapies.

Our alternative

treatments are part of The Vivos Method .

Vivos Method is an advanced therapeutic protocol, which often combines the use of customized oral appliance specifications and proprietary

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current suite of products by more than 2,000 trained dentists.

Note 1 to the accompanying financial statements for additional background information on our Company and current product and service

June 2025, we acquired all assets, including operating assets such as sleep testing, diagnostics, and treatment centers of SCN.

The Acquisition

marked a milestone in the pivot to our medical provider-focused sales, marketing distribution model for our innovative OSA appliances.

Under the new model, SCN will provide sleep disorder patients with the opportunity to be candidates for our advanced, proprietary and

FDA-cleared CARE oral medical devices, oral appliances and additional adjunctive therapies and methods.

Under customary agreements designed

to comply with applicable corporate practice of medicine law, our operation of SCN allows us to manage and capture both diagnostic and

diagnostic consulting revenues, representing new higher margin revenue streams for us, as well as potential Vivos appliance and related

product and service revenue.

Business of this Report for additional background information on our Company and current product and service

Items, Trends and Risks Impacting Our Business

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VIPs have the ability to start generating revenue for us and themselves after this training.

dentists to enroll as VIPs, we have worked with different marketing programs (which we generally call a “discovery track”)

with respect to the payment of VIPs enrollment fee, including discounts and payment plans.

Once VIPs execute their VIP enrollment agreement,

the discovery track allows the VIP 45 to 60 days to obtain financing and pay the enrollment fee.

Ongoing support and additional training

is provided throughout the year under the services contract, which includes access to our proprietary Airway Intelligence Services, which

provides the VIP with resources to help simplify the sleep apnea diagnostic and Vivos treatment planning process.

addition to enrollment service revenue, we offer additional services, such as our Billing Intelligence Services offering, and MyoCorrect

orofacial myofunctional therapy services, which was introduced in April 2021.

Revenue for these services is recognized as our performance

obligations are satisfied in accordance with ASC 606.

of our 2024 marketing and distribution business model pivot, we have become more focused on engaging in strategic collaborations or

acquisitions to market the benefits of the Vivos treatment modalities to dentists and other medical providers, including our

cooperative relationships with various medical providers to deliver diagnostic and medical consultation services to people across

North America who suffer from OSA.

As such, while we will continue to recognize some VIP enrollment revenue going forward, such

revenue will become increasing less important to us.

addition to enrollment service revenue, we offer additional services, such as our Billing Intelligence Services offering, and

MyoSync (formally MyoCorrect) orofacial myofunctional therapy services, which was introduced in April 2021.

Revenue for these

services is recognized as our performance obligations are satisfied in accordance with ASC 606.

of our 2024 marketing and distribution business model pivot, we have become more focused on engaging in strategic collaborations or acquisitions

to market the benefits of the Vivos treatment modalities to dentists and other medical providers, including our cooperative relationships

with various medical providers to deliver diagnostic and medical consultation services to people across North America who suffer from

As such, while we will continue to recognize some VIP enrollment revenue through 2026, we believe such revenue will become immaterial.

recognize revenue on VIP enrollments once the contract is executed, payment is received, and as our performance obligations are satisfied

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Vivos treatment case starts is paramount, as case starts lead to appliance orders and related revenue.

provider is fully trained, we encourage them to start cases.

However, our experience has been that VIPs typically start slowly as

they introduce The Vivos Method into their practices.

The slow acceptance rate Vivos appliances with providers lead Vivos to

consider other business models including the alliance marketing and distribution model announced in 2024 to sell additional product.

While we work with VIPs to screen their patients for OSA with our SleepImage ® home sleep apnea ring test (which we

expect will encourage Vivos Method case starts), not all VIPs incorporate our The Vivos Method into their practices at the same

We believe VIPs can recoup their investment in VIP enrollment with approximately eight Vivos Method case starts, but as noted

above, many VIPs start and also maintain their case starts at a significantly slower rate.

We presently have a concentration of

active VIPs who regularly start new Vivos Method treatment cases.

Approximately 36% of our VIPs initiated a new case as of December

As noted, we believe that reducing our reliance on VIPs and increasing the number of strategic marketing and distribution

alliances (or acquiring medical or dental practices) will provide us with a better opportunity to drive appliance sales going

Once a provider

is fully trained, we encourage them to start cases.

However, our experience has been that VIPs typically start slowly as they introduce

The Vivos Method into their practices.

The slow acceptance rate Vivos appliances with providers lead Vivos to consider other business

models including the medical provider-focused alliance marketing and distribution model announced in 2024 to sell additional product.

While we work with VIPs to screen their patients for OSA with our SleepImage ® home sleep apnea ring test (which we expect

will encourage Vivos Method case starts), not all VIPs incorporate our The Vivos Method into their practices at the same rate.

VIPs can recoup their investment in VIP enrollment with approximately eight Vivos Method case starts, but as noted above, many VIPs start

and also maintain their case starts at a significantly slower rate.

We presently have a low concentration of active VIPs who regularly

start new Vivos Method treatment cases.

As noted, we believe that reducing our reliance on VIPs and increasing the number of strategic

marketing and distribution alliances (or acquiring medical or dental practices) will provide us with a better opportunity to drive appliance

sales going forward.

addition, an important aspect of our strategy to increase product revenues relates to the products and related intellectual property

we acquired in March 2023 from Advanced Facialdontics, LLC (“AFD”), including a custom single arch device with an FDA 510(k)

clearance for treating TMD and/or Bruxism (teeth grinding or clenching).

We have rebranded the AFD products as Vivos Versa, Vivos Vida

and Vivos Vida Sleep.

we acquired in March 2023 from Advanced Facialdontics, LLC (“ AFD ”), including a custom single arch device with an

FDA 510(k) clearance for treating TMD and/or Bruxism (teeth grinding or clenching).

We have rebranded the AFD products as Vivos Versa,

Vivos Vida and Vivos Vida Sleep.

Our efforts to engage in research to demonstrate the clinical efficacy of our products and obtain additional regulatory

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Our DNA device is currently indicated for the treatment of mild

to severe sleep apnea and jaw repositioning in adults (and in the case of severe OSA, along with positive airway pressure and/or

myofunctional therapy, as needed) and has an FDA clearance intended to reduce nighttime snoring and to treat moderate and severe obstructive

sleep apnea in children, 6- 17 years of age who are diagnosed with snoring and/or moderate or severe obstructive sleep apnea and need

orthodontic treatment.

Enrollment of 150 patients with moderate to severe sleep apnea (apnea-hypopnea index score of 15 or greater) will

be randomly assigned to either treatment with our FDA-cleared DNA appliance or CPAP.

The protocol has been finalized, and enrollment

began in 2024.

Late 2024, our clinical study conducted in collaboration with Stanford University and evaluating the DNA and CPAP for

the treatment of OSA, was placed on hold by Stanford University.

The decision to pause the study was made due to low recruitment into

are actively working with Stanford University to address the concerns that led to the hold and has continued engaged discussions with

the university.

While we believe these efforts will facilitate the resumption of the study, there can be no assurance that the hold will

be lifted in a timely manner, or at all.

Any delay or failure to resolve the issues could impact the development timeline and future

prospects for the study.

We remain committed to the highest standards of patient safety, scientific integrity, and regulatory compliance

and will provide updates as material developments occur.

This trial may not meet its designated endpoints, and therefore additional FDA

clearances for the DNA device may not be obtained.

to severe sleep apnea and jaw repositioning in adults (and in the case of severe OSA, along with positive airway pressure and/or myofunctional

therapy, as needed) and has an FDA clearance intended to reduce nighttime snoring and to treat moderate and severe obstructive sleep

apnea in children, 6- 17 years of age who are diagnosed with snoring and/or moderate or severe obstructive sleep apnea and need orthodontic

Enrollment of 150 patients with moderate to severe sleep apnea (apnea-hypopnea index score of 15 or greater) will be randomly

assigned to either treatment with our FDA-cleared DNA appliance or CPAP.

The protocol has been finalized, and enrollment began in 2024.

Late 2024, our clinical study conducted in collaboration with Stanford University and evaluating the DNA and CPAP for the treatment of

OSA, was placed on hold by Stanford University.

The decision to pause the study was made due to low recruitment into the study.

is still on hold as of 2025.

are working with Stanford University to address the concerns that led to the hold and has continued engaged discussions with the university.

While we believe these efforts will facilitate the resumption of the study, there can be no assurance that the hold will be lifted in

a timely manner, or at all.

Any delay or failure to resolve the issues could impact the development timeline and future prospects for

We remain committed to the highest standards of patient safety, scientific integrity, and regulatory compliance and will provide

updates as material developments occur.

This trial may not meet its designated endpoints, and therefore additional FDA clearances for

the DNA device may not be obtained.

During 2023, we entered into distribution collaborations with third parties to expand access of our products to potential

We hope that these strategic initiatives will lead to revenue growth opportunities for us in 2024 and beyond, and our ability

to capitalize on these initiatives is expected to be a material aspect of our sales and marketing program going forward.

example, on June 1, 2023, we entered into a non-exclusive distribution agreement with Lincare, a leading supplier in the United States

of respiratory products, such as CPAP equipment.

Lincare currently provides respiratory products to approximately 1.8 million patients

Pursuant to this agreement, Lincare began to distribute certain of our products in the United States, including the Vida™,

VidaSleep™, and Versa ® .

The distribution agreement was subject to a 90-day pilot program in Colorado and Florida.

Within weeks of starting the pilot program, Lincare reported an initial 36% positive patient response to our products subject to the

October 24, 2023, we announced the conclusion of this pilot program and an amendment to our Lincare agreement to appoint Lincare as our

exclusive DME distributor in the U.S.

for a period of 6-months to distribute the products described above.

Although the roll out has

been slower than anticipated, plans are underway to extend the scope of the distribution territory beyond the initial two markets into

Texas, Virginia, North Carolina, New Jersey and at least one other major market.

Others are expected to follow soon thereafter.

hopeful that this new form of arrangement with Lincare and possibly other DME companies will help us increase our product revenues in

2024 and beyond.

to capitalize on these initiatives is expected to be a material aspect of our medical provider-focused sales and marketing program going

in October 2023, we announced an exclusive distribution agreement with NOUM DMCC, a Dubai-based company focused on diagnostic testing

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the Middle East-North Africa region.

With regulatory approvals pending, there was no revenue from this collaboration in 2024.

on Sales from Unregistered Oral Appliance Publicity.

On or about March 1, 2023, CBS News reported the tragic case of a woman with

a malocclusion and breathing problem who had received treatment via a fixed oral appliance known as the AGGA (Anterior Growth Guidance

According to the televised CBS report, the device created serious issues with her dentition and jaws, resulting in the loss

of several anterior teeth.

The patient filed a $10 million lawsuit against the treating dentist.

of this lawsuit quickly spread throughout the country, and particularly within the dental and orthodontic communities.

Within days, rumors

and wildly untrue statements were published on social media platforms and elsewhere that began to associate and confuse Vivos appliances

with the AGGA.

Vivos management immediately responded to correct any misinformation and to set the record straight.

was not named in the lawsuit, nor was our device implicated in creating the tooth displacement and other concerns that gave rise to the

To our knowledge, in approximately 58,000 patients treated, Vivos oral appliances have never caused the loss of even a single

tooth, and we have never been sued over a patient complaint or safety issue.

Vivos has never had any association or affiliation with

the AGGA device or its promoters, nor have we ever endorsed these kind of counterfeit fixed oral appliances that make unproven and unsubstantiated

AGGA is a non-FDA cleared oral appliance developed by Dr.

Steve Galella, a dentist from Tennessee.

He has actively promoted and taught

other dentists about his device for many years through the Las Vegas Institute (LVI) and elsewhere.

Galella has claimed that the

AGGA can “grow, expand, and remodel an adult’s jaw”, and that roughly 10,000 OSA and TMD patients have been successfully

treated using this device.

FDA regulates and categorizes all medical devices claiming to treat obstructive sleep apnea (OSA) and/or TMD disorders as Class II devices

and requires that they have a 510(k) clearance in order to be used with patients.

The AGGA device does not have any such FDA clearance,

nor are there any known peer-reviewed and published studies validating the safety and efficacy of this device.

In stark contrast, all

Vivos oral appliances are duly registered or cleared by the FDA according to strict FDA guidelines.

Our appliances and attending protocols

for proper use are also backed by extensive peer reviewed published research.

Moreover, Vivos appliances operate on a completely different

mechanism of action than that of the AGGA and similar devices on the market.

Vivos has always maintained that such appliances tend to

create inflammation and pose other risks that are unacceptable.

The AGGA is a fixed appliance, whereas Vivos appliances are removable

core product is The Vivos Method, not any one single device.

We believe this is a key distinguishing factor for our approach.

Method involves far more than just our oral appliances.

It begins with proper and thorough diagnosis and ends with a customized multidisciplinary

treatment plan that likely incorporates one or more of several treatment modalities, including oral myofunctional therapy, SOT chiropractic,

physical therapy, laser therapy, nutritional counseling, CPAP, mandibular advancement, C.A.R.E.

device therapy, and more.

The Vivos Method

is thus a fully integrated end-to-end diagnostic, training, and treatment platform that can adapt to the needs of virtually any and every

breathing disordered sleep patient.

Unfortunately,

and despite our best efforts to distance ourselves and our products from the AGGA device, the entire matter generated a certain

amount of confusion and fear amongst both existing VIP dentists and other non-affiliated dentist prospects.

Thus, new provider

enrollments and sales of Vivos appliances in the third quarter decreased as word spread in 2023.

By the latter part of June 2024, we

began to see a partial rebound in both new enrollments and appliance sales.

Nevertheless, certain Vivos-trained providers remain

very cautious and are being far more selective in their cases, which has continued to impact appliance sales through the end of the

third quarter.

believe that this is a short-term phenomenon and should not be a long-term hindrance to new case starts, but the full impact of this

phenomenon is hard to predict.

With regulatory approvals pending, there was no revenue from this collaboration in 2024 or 2025.

has been experiencing a period of inflation which has increased (and may continue to increase) our and our suppliers’

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to adjust other aspects of our business as we seek 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, as occurred in the recession of 2008, then the impact on our revenue, earnings

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

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

rates, however, the perceived decrease was lower than what was expected.

Such 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, as

occurred in the recession of 2008, then the impact on our revenue, earnings and access to capital of both inflation and inflation-fighting

responses would be impossible to know or calculate.

From time to time, we may experience supply chain challenges due to forces beyond our control.

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blockage earlier in 2021 caused some delay in shipments of SleepImage ® rings from China.

Overall, however, as our appliances

are made in the U.S., we have not experienced significant supply chain issues as a result of COVID-19 or otherwise, although this may

change in future periods.

in Ukraine and Middle East Hostilities.

In addition, worldwide supply chain constraints and economic and capital markets uncertainty

arising out of Russia’s invasion of Ukraine in February 2022 and the attacks by Hamas on Israel in October of 2023 and Israel’s

responses have disrupted commercial and capital markets and emerged as new barriers to long-term economic recovery.

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.

Capital markets uncertainty, with public stock price decreases and volatility, could make it more difficult for us to raise capital when

Changes in U.S.

or foreign trade

policy, including the imposition of new tariffs, increases in existing tariffs or changes in customs classifications, could increase

Overall, however, as our appliances are made in the U.S., we have not experienced significant supply chain issues as a result

of COVID-19 or otherwise, although this may change in future periods.

East Hostilities.

In addition, geopolitical instability in the Middle East continues to create uncertainty in global economic conditions

and commercial activity.

Hostilities in the region, including the attacks by Hamas on Israel in October 2023, Israel’s subsequent

military responses, and more recent U.S.

and Israeli military actions involving Iran, have contributed to heightened regional and global

These developments, combined with the ongoing effects of Russia’s invasion of Ukraine that began in February 2022, have

intensified supply chain constraints, increased commodity price volatility, disrupted international trade flows, creating.

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.

Capital markets uncertainty, with public stock price decreases and volatility, could make it more difficult for us to

raise capital when needed.

Nasdaq Delisting .

As previously reported, we are currently subject to two Nasdaq Stock Market (“Nasdaq”) listing deficiencies,

one related to Nasdaq’s $1.00 minimum bid price requirement (the “Minimum Bid Requirement”) and a second related to

Nasdaq’s $2,500,000 minimum stockholders’ equity requirement (the “Minimum Stockholders’ Equity Requirement”).

Given that our stockholders’ equity at December 31, 2025 was less than $2.5 million, we are presently not

in compliance with the Nasdaq Stock Market’s (“Nasdaq”) minimum stockholders’ equity requirement (the “Equity

Requirement”).

We are seeking to regain compliance by raising new funding in the form of equity and reducing costs.

will be faced with delisting proceedings which will distract management and cost resources to remedy,

have a history of challenges of maintaining compliance with the Nasdaq’s continuing listing requirements.

We have been subject

to two Nasdaq listing deficiencies, one related to Nasdaq’s $1.00 minimum bid price requirement (the “Minimum Bid Requirement”)

and a second related to the Equity Requirement.

September 21, 2023, we received a written notice from the Nasdaq staff confirming that since, as of that date, we failed to meet the

Minimum Bid Requirement, and because as of the period ended June 30, 2023 we also failed the Minimum Stockholders’ Equity Requirement,

Nasdaq would commence delisting proceedings against us.

As permitted under Nasdaq rules, we appealed the Nasdaq staff’s determination

and requested a hearing (the “Hearing”) before a Nasdaq Hearing Panel (the “Hearing Panel”).

The Hearing request

stayed any delisting or suspension action by the Nasdaq staff pending the issuance of the Hearing’s Panel decision.

took place on November 9, 2023.

Minimum Bid Requirement, and because as of the period ended June 30, 2023 we also failed the Equity Requirement, Nasdaq would commence

delisting proceedings against us.

As permitted under Nasdaq rules, we appealed the Nasdaq staff’s determination and requested a

hearing (the “Hearing”) before a Nasdaq Hearing Panel (the “Hearing Panel”).

The Hearing request stayed any delisting

or suspension action by the Nasdaq staff pending the issuance of the Hearing’s Panel decision.

The Hearing took place on November

to the date of the Hearing, we effectuated a reverse stock split of our issued and outstanding shares of common stock at a ratio of 1-for-25

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compliance with the Minimum Bid Requirement.

the Hearing on November 9, 2023, we presented our plan to regain compliance with the minimum stockholders’ equity requirement (the

“Equity Rule”), which plan includes raising additional equity capital.

On November 30, 2023, we received a letter from the

Hearings Panel that, subject to certain conditions, the Hearings Panel granted our request to continue to be listed on Nasdaq.

conditions include providing an update as to our plan to regain compliance with the Equity Rule as well as demonstrating compliance by

March 19, 2024.

On February 23, 2024 we presented our plan of compliance to the Hearings Committee.

On May 6, 2024, we received written

notice from the Nasdaq staff indicating that the Company had regained compliance with the Equity Rule.

the Hearing on November 9, 2023, we presented our plan to regain compliance with the Equity Requirement, which included raising additional

equity capital.

On November 30, 2023, we received a letter from the Hearings Panel that, subject to certain conditions, the Hearings

Panel granted our request to continue to be listed on Nasdaq.

On February 23, 2024 we presented our plan of compliance to the Hearings

On May 6, 2024, we received written notice from the Nasdaq staff indicating that we had regained compliance with the Equity

May 16, 2024, we received a further written notice from Nasdaq indicating that, as of March 31, 2024, we failed to comply with the Equity

On June 25, 2024, we reported in a Current Report on Form 8-K that it believed it had stockholders’ equity of at least

On June 25, 2024, we reported in a Current Report on Form 8-K that we believed we had stockholders’ equity of at least

$2.5 million as of the date of the filing of such report as a result of our closing of a $7.5 million equity private placement on June

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requested the continued listing of its securities on Nasdaq.

July 5, 2024, we were notified that the Panel had granted our request for continued listing on Nasdaq, subject to our filing of the Form

10-Q for the quarter ended June 30, 2024, with the Securities and Exchange Commission by August 15, 2024, evidencing our compliance with

the Equity Requirement.

July 5, 2024, we were notified that the Panel granted our request for continued listing on Nasdaq, subject to our filing of the Form

10-Q for the quarter ended June 30, 2024, with the Securities and Exchange Commission, evidencing our compliance with the Equity Requirement.

We made such filing in a timely manner.

are working diligently to ensure our continued compliance with the Equity Requirement, including exploring a potential additional equity

capital financing or financings to stay above the minimum threshold of the Equity Requirement.

We anticipate that our new strategic marketing

and distribution alliance model will also positively impact our revenue growth and stockholders’ equity in upcoming fiscal quarters.

However, there is a risk that we will be unable to raise sufficient capital or generate sufficient revenue or operating results to maintain

compliance with the Equity Requirement.

If we fail to achieve ongoing compliance and its common stock is delisted by Nasdaq, such delisting

would likely have a material adverse effect on our stock price, the ability of our stockholders to buy or sell their common stock, our

ability to raise capital and on our reputation, all of which could make it significantly more difficult to operate.

are working diligently to ensure our continued compliance with the Equity Requirement, including additional equity capital financing

or financings and cost reductions to stay above the minimum threshold of the Equity Requirement.

We anticipate that our new medical provider-focused

strategic marketing and distribution alliance model will also positively impact our revenue growth and stockholders’ equity in

upcoming fiscal quarters.

However, there is a risk that we will be unable to raise sufficient capital, reduce costs sufficiently or generate

sufficient revenue or operating results to maintain compliance with the Equity Requirement.

If we fail to achieve ongoing compliance

and our common stock is delisted by Nasdaq, such delisting would likely have a material adverse effect on our stock price, the ability

of our stockholders to buy or sell their common stock, our ability to raise capital and on our reputation, all of which could make it

significantly more difficult to operate.

Components of Consolidated Statements of Operations

We recognize revenue when we satisfy our performance obligations over time as our customers receive the benefit of

the promised goods and services, which generally occurs over a short period of time.

Performance obligations with respect to

appliance sales are typically satisfied by shipping or delivering products to our VIPs or to the sleep clinic, through our new

strategic alliance model, in the case of enrollment or service revenue, upon our satisfaction of performance obligations associated

with VIP enrollments.

Revenue consists of the gross sales price, net of estimated allowances, discounts, and personal rebates that

are accounted for as a reduction from the gross sale price.

We recognize revenue when we satisfy our performance obligations over time as our customers receive the benefit of the

promised goods and services, which generally occurs over a short period of time.

Performance obligations with respect to appliance sales

are typically satisfied at a point in time by shipping or delivering products to our VIPs or to the sleep clinic, through our new strategic

alliance model.

In the case of enrollment or service revenue, upon our satisfaction of performance obligations associated with VIP enrollments.

Revenue consists of the gross sales price, net of estimated allowances, discounts, and personal rebates that are accounted for as a reduction

from the gross sale price.

the case of product purchased by clinics managed by our subsidiary for inclusion in a treatment protocol, the sales price of the Vivos

device is recognized by us and becomes a component of cost of sales of the treatment center service provided to the patient.

treatment centers, the intercompany account is used to fulfil the account payable obligation and recognize the expense of the goods and

services in cost of sales.

Cost of goods sold primarily consists of direct costs attributable to the purchase from third party suppliers and related

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and administrative expenses.

General and administrative (“G&A”) expenses consist primarily of personnel costs

for our administrative, human resources, finance and accounting employees, and executives.

General and administrative expenses also include

contract labor and consulting costs, travel - related expenses, legal, auditing and other professional fees, rent and facilities

costs, repairs and maintenance, and general corporate expenses.

General and administrative (“ G&A ”) expenses consist primarily of personnel

costs for our administrative, human resources, finance and accounting employees, and executives.

General and administrative expenses

also include contract labor and consulting costs, travel - related expenses, legal, auditing and other professional fees, rent and

facilities costs, repairs and maintenance, and general corporate expenses.

and amortization expense.

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Other expense

Excess warrant fair value

Change in fair value of warrant liability, net of issuance costs of $645

increased approximately $1.2 million, or 9%, to approximately $15.0 million for the year ended December 31, 2024 compared to $13.8 million

for the year ended December 31, 2023.

Revenue during the year ended December 31,2024 was impacted by an increase of approximately $1.6

million in product revenue, coupled with a decrease of approximately $0.4 million in service revenue.

The increase in product revenue

is attributable to an increase of approximately $2.1 million in Guide sales to VIPs, followed by a decrease of approximately $0.5 million

appliance sales to VIPs.

Net loss attributable to non-controlling interest

Net loss attributable to stockholders

increased approximately $2.4 million, or 16%, to approximately $17.5 million for the year ended December 31, 2025 compared to $15.0

million for the year ended December 31, 2024.

This was due to an increase of approximately $4.8 million in Sleep testing services,

and an increase of approximately $2.2 million of revenue generated from Vivos treatment to patients launched at two SCN locations.

The increase in revenue during the year ended December 31, 2025 was offset by the decline in product revenue attributable to a

decrease of approximately $1.4 million in appliance sales to VIPs, followed by an increase of approximately $1.0 million in tooth

positioner sales to VIPs.

Additionally, we had a decrease in service revenue of approximately $2.0 million in our VIP enrollment

revenue, and a decrease of approximately $0.3 million from Myofunctional revenue.

This was offset by an increase of approximately $1.3

million in sponsorship, conference and training related revenue.

BIS revenue decreased by $0.1 million to approximately $0.8 million,

which was offset by an increase of $0.1 million from sleep testing services to approximately $1.3 million for the year ended December

the year ended December 31, 2024, we enrolled 112 VIPs and recognized VIP enrollment revenue of approximately $2.5 million, a decrease

of approximately 37% in enrollment revenue, compared to the year ended December 31, 2023, when we enrolled 150 VIPs for a total of approximately

$3.9 million.

Service revenue decrease in 2024 was due to changes to key inputs in our revenue recognition methodology, primarily estimated

customer lives.

As part of our annual process, the estimated customer lives are calculated separately for each year and was estimated

to be 27 months in 2024, an increase of 17%, compared to 23 months in 2023, and an increase of 50% when compared to 18 months in 2022.

Estimated customer lives impacts the amortization of revenue to be spread over a longer period of time, thus decreasing the revenue that

is recognized over the same period when compared to December 31, 2023.

Although such adjustment to customer lives negatively impacts

our revenue recognition, increasing estimated customer lives results in customers staying active for a longer period of time, thus increasing

our customer retention year-over-year.

Additionally, our revenue was lowered by a sales strategy shift and focus toward sleep center

affiliations, coupled with lower enrollments in late 2023 and all of 2024, which resulted in lower service revenue for the year ended

revenue, a decrease of approximately $0.7 million in sponsorship, conference and training related revenue, and a decrease of

approximately $0.3 million in Myofunctional therapy and $0.2 million in BIS revenue.

the year ended December 31, 2025, we enrolled no VIPs and recognized VIP enrollment revenue of approximately $0.5 million, a decrease

of approximately 80% in enrollment revenue due to the pivot to the new business model, compared to the year ended December 31, 2024,

when we enrolled 112 VIPs for a total of approximately $2.5 million.

Over the last year, our reliance on VIP enrollment revenue has diminished

significantly as such revenues have decreased due to our pivot.

Our revenue was impacted by the sales strategy shift and focus toward

sleep center affiliations, coupled with lower enrollments in 2024 and 2025, which resulted in lower service revenue for the year ended

December 31, 2025.

This was offset by a higher incidence of breakage in contracts, which accelerated revenue recognition on several contracts

for VIPs who did not complete their training during the first 90 days of their enrollment.

Approximately $1.7 million in revenue was

attributable to breakage during the year December 31, 2024, when compared to approximately $0.7 million during the year ended December

the year ended December 31, 2024, we sold 16,182 oral appliance arches and guides for a total of approximately $7.9 million, a 26% increase

in revenue from the year ended December 31, 2023, when we sold 8,240 oral appliance arches and guides for a total of approximately $6.3

The increase is directly attributable to a 71% decrease in discounts offered during the same period, with less than $0.2 million

in discounts offered during the year ended December 31, 2024 when compared to approximately $0.7 million of discounts offered during

the year ended December 31, 2023, coupled with an increase in Guide sales, which are lower revenue generating products when compared

to Vivos appliances.

the year ended December 31, 2025, we sold 25,441 oral appliance arches and tooth positioners for a total of approximately $6.5 million,

a 18% decrease in revenue from the year ended December 31, 2024, when we sold 16,182 oral appliance arches and tooth positioners for

a total of approximately $7.9 million.

The revenue decrease is directly attributable to an increase in discounts offered during the same

period, with $1.6 million in discounts offered during the year ended December 31, 2025 when compared to approximately $0.2 million of

discounts offered during the year ended December 31, 2024, coupled with an increase in tooth positioner sales, a lower price point product

when compared to Vivos appliances.

of Sales and Gross Profit

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to approximately $6.0 million for the year ended December 31, 2024.

This was primarily due to $1.2 million in higher costs directly related

to an increase in lab fees from our primary vendors, offset by a decrease of less than $0.3 million related to lower costs associated

with the ring lease program and a decrease of slightly over $0.3 million in VIP training, and a decrease of approximately $0.1 million

for inventory obsolescence expense.

the year ended December 31, 2024, gross profit increased by approximately $0.7 million to $9 million.

This was primarily due to approximately $1.1 million in higher costs

in diagnostic services related to new sleep center affiliations, and an increase of approximately $0.5 million related to additional

staff associated with the sleep center affiliations.

the year ended December 31, 2025, gross profit increased by approximately $1.5 million or 17% to $10.5 million.

This increase was attributable

to an increase in revenue of approximately $2.4 million, offset by an increase in cost of sales of approximately $0.9 million.

remained constant at 60% for the year ended December 31, 2024, compared year ended December 31, 2023.

margin remained constant at 60% for the year ended December 31, 2025, and 2024.

and Administrative Expenses

and administrative expenses decreased approximately $4.6 million, or approximately 20%, to approximately $17.9 million for the year ended

December 31, 2024, as compared to $22.5 million for the year ended December 31, 2023.

The primary driver of this decrease was a change

in personnel and related compensation of approximately $1.7 million, including salaries and benefits, paid time off, stock-based compensation,

and other employee-related expenses, as a result of reduction in force and less stock options vested during the year, as a result of

the reduction in force implemented beginning with the second and third quarters of 2023 and into the year ended December 31,

Other reasons for the decrease in general and administrative expenses include a decrease of approximately $1.8 million in professional

fees, including consulting and legal fees.

A decrease of approximately $0.4 million related to travel, meals and entertainment, a decrease

of approximately $0.3 million related to insurance, a decrease of approximately $0.2 million related to change in the allowance for credit

losses, and a decrease of approximately $0.2 million in infrastructure expenses such as communications, development and customization.

and Administrative expenses increased $9.8 million to $27.7 million for the year ended December 31, 2025, compared to approximately $17.9

million for the year ended December 31, 2024.

This increase was primarily due to approximately $6.7 million in costs associated with

running SCN’s operations and related Vivos treatment centers.

In addition, approximately $1.6 million related to professional fees,

approximately $0.8 million associated with salaries and wages and Vivos personnel and infrastructure costs of approximately $0.6 million

when compared to the year ended December 31, 2024.

and Marketing

and marketing expense decreased by $0.7 million to approximately $1.7 million for the year ended December 31, 2024, compared to $2.5

and marketing expense decreased by $0.3 million to $1.4 million for the year ended December 31, 2025, compared to approximately $1.7

million for the year ended December 31, 2024.

This decrease was primarily driven by a $0.2 million decrease in commissions, as well as

a $0.3 million decrease related to a reduction in website development, materials and product samples as well as print media and marketing

supplies, including conventions and tradeshow expenses.

a $0.1 million decrease in conventions and tradeshow expenses.

and Amortization

and amortization expense was approximately $0.6 million for the years ended December 31, 2024 and 2023.

Depreciation and

amortization remained constant during the period due to an immaterial amount of depreciable assets placed into service.

warrant fair value and change in fair value of warrant liability, net of issuance costs

liability for the warrants issued in the January 9, 2023 private placement totaled approximately $14.5 million which included 186,667

pre-funded warrants with a fair value of approximately $6.7 million and 266,667 additional warrants with a fair value of approximately

$7.7 million.

The difference between the fair value of the $14.5 million liability-classified warrants and the net proceeds received

of approximately $8.0 million, or approximately $6.5 million, was recognized as a day-one non-operating expense.

The change in fair value

of the warrant liability was approximately $10.8 million, or $10.2 million of other income net of issuance costs of $0.6 million, for

the year ended December 31, 2023.

The net impact of the private placement warrants on net loss for the year ended December 31, 2023 was

approximately $3.8 million of other income.

and amortization expense was approximately $1.3 million for the year ended December 31, 2025, compared to approximately $0.6 million

for the year ended December 31, 2024.

Depreciation and amortization increased due to an increase in depreciable assets related to the

new sleep center asset acquisition and affiliations.

and Capital Resources

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the Company as a going concern.

We have incurred losses since inception, including $11.1 and $13.6 million for the years ended December

31, 2024 and 2023, respectively, resulting in an accumulated deficit of approximately $104.2 million as of December 31, 2024.

We have incurred losses since inception, including $21.2 million and $11.1 million for the years ended

December 31, 2025 and 2024, respectively, resulting in an accumulated deficit of approximately $125.4 million as of December 31, 2025.

cash used in operating activities amounted to approximately $15.3 and $12.7 million for the years ended December 31, 2025 and 2024, respectively.

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these factors raise substantial doubt regarding our ability to continue as a going concern.

have implemented cost savings measures that lead to reduced impact to cash used in operations.

However, sales did not grow in the year

ended December 31, 2023 or in 2024 as anticipated, as our product offerings and distribution strategies continue to be improved and refined.

As such, we have raised equity capital in late 2023 and throughout 2024 and will be required to obtain additional financing to satisfy

our cash needs and bolster our stockholders’ equity for Nasdaq compliance purposes, as management continues to work towards increasing

revenue to achieve cash flow positive operations in the foreseeable future.

Until a state of cash flow positivity is reached, management is reviewing

all options to obtain additional financing to fund operations.

This financing is expected to come primarily from the issuance of equity

securities in order to sustain operations until we can achieve profitability and positive cash flows, if ever.

We expect that our new

sales and marketing alliance with Rebis (and similar alliances or acquisitions of sleep centers or other providers we may undertake) have

the potential to increase patient volume, drive top line revenue and lower customer acquisition costs and overhead.

However, there can

be no assurances that this new model will have effects we anticipate, and our relatively low cash on hand could lead us to again requiring

additional funding.

There is a risk that adequate additional funding will be available on favorable terms, or at all.

have implemented cost savings measures that have reduced cash used in operations.

However, sales did not grow in the year ended December

31, 2024 or in 2025 as anticipated, as our product offerings and distribution strategies continue to be improved and refined.

we raised equity capital throughout 2024 and 2025 and will be required to obtain additional financing to satisfy our cash needs and bolster

our stockholders’ equity for Nasdaq compliance purposes, as management continues to work towards increasing revenue to achieve

cash flow positive operations in the foreseeable future.

we attain positive cash flow, our management is reviewing all options to obtain additional financing to fund our operations.

the SCN acquisition from the issuance of senior secured debt and equity securities.

As reflected in our increase in revenue for the year

ended December 31, 2025, we expect the SCN Acquisition will ultimately allow our company to achieve positive cash flows;

however, there

is a risk this may not occur.

We originally expected the Strategic Alliance Agreement (“ SAA ”) with Rebis Health entered

into in June 2024 to increase patient volume, drive top line revenue and lower customer acquisition costs and overhead.

to ongoing delays at Rebis Health that are beyond our control, we are currently re-evaluating expectations under this SAA.

seek to acquire other sleep centers in transactions similar to the SCN Acquisition or enter into other strategic alliances with improved

There can be no assurances that adequate additional funding will be available on favorable terms, or at all.

If such funds are

not available in the future, or that if our new model does not result in the patient volume and financial results within the expected

timelines, we may also be required to delay, significantly modify or terminate some or all of our operations, all of which could have

a material adverse effect on us and our stockholders.

not available in the future, or the SAA or similar alliances or acquisitions do not result in the patient volume, appliance sales and

financial results within the timeframes we expect, we may be required to delay, significantly modify or terminate some or all of our

operations, all of which could have a material adverse effect on us and our stockholders.

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

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Financing activities

cash used in operating activities of approximately $12.7 million for the year ended December 31, 2024 is an increase of approximately

$0.7 million compared to net cash used in operating activities of approximately $11.9 million for the year ended December 31, 2023.

increase is due primarily to a decrease of approximately $1.8 million in accounts payable, decrease of approximately $0.5 million in

accrued expenses, a decrease of approximately $1.2 million for the employee retention credit liability which was not present in 2024,

a decrease in accounts receivable of approximately $0.4 million offset by the decrease in the allowance for doubtful accounts, an decrease

in prepaids of approximately $1.0 million, and a decrease in fair value of common stock and warrants issued for services of approximately

$0.7 million.

This was offset by a decrease in our net loss of approximately $2.5 million, a favorable net change in the fair value of

warrant liability of approximately $10.2 million, offset by day-one non-operating warrant expense of approximately $6.5 million.

the year ended December 31, 2024, net cash used in investing activities consisted of capital expenditures for software of $0.6 million

related to the development of software for internal use, expected to be placed in service in 2025.

This compares to net cash used in

investing activities for the year ended December 31, 2023 of $0.9 million due to capital expenditures for internally developed software,

as well as a purchase of a patent portfolio in February 2023.

cash provided by financing activities of $17.9 million for the years ended December 31, 2024, is attributable to proceeds of $19.2 million

from the issuance of Common Stock and Warrants, net of approximately $1.4 million of professional fees and other issuance costs, in our

February warrant inducement, as well as the June, September and December private placements.

This compares to net cash used in investing

financing for the year ended December 31, 2023 of $10.9 million, attributable to gross proceeds of $12.0 million from the issuance of

Common Stock, net of approximately $1.1 million of professional fees and other issuance costs, from our private placement in January

and November 2023.

cash used in operating activities of approximately $15.3 million for the year ended December 31, 2025 which represents an increase of

approximately $2.6 million compared to net cash used in operating activities of approximately $12.7 million for the year ended December

This increase is due primarily to an increase of approximately $3.3 million in accrued expenses, an increase of approximately

$1.6 million in accounts payable, an increase of approximately $0.9 million in contract liability, an increase of approximately $0.9

million in other liabilities, an increase of $0.7 million for depreciation and amortization, an increase of approximately $0.2 million

for prepaid expenses and other current assets, and an increase of approximately $0.2 million for net operating lease liabilities.

are offset by an increase in our net loss of approximately $10.1 million, a decrease of approximately $0.1 million for stock-based compensation

and a decrease of approximately $0.1 million for deposits.

the year ended December 31, 2025, net cash used in investing activities consisted of capital expenditures of approximately $5.2 million

for the SCN Acquisition in June 2025, assets placed in service in 2025 related to the integration of SCN and capital expenditures

of approximately $2.3 million related to the development of software for internal use that was also placed in service in the first quarter

of the fiscal year ended December 31, 2025.

This compares to net cash used in investing activities for the year ended December 31, 2024

of $0.6 million due to capital expenditures for the development of software for internal use.

cash provided by financing activities of $18.6 million for the years ended December 31, 2025, is attributable to proceeds of approximately

$5.6 million from the issuance of common stock, approximately $10.7 million from the issuance of debt, approximately $2.3 million from

the issuance of warrants, and approximately $0.9 million from the exercise of warrants, net of approximately $0.8 million of professional

fees and other issuance costs.

This compares to net cash provided by investing financing for the year ended December 31, 2024 of $17.9

million, attributable to proceeds of $19.2 million from the issuance of common stock and warrants, net of approximately $1.4 million

of professional fees and other issuance costs, in our February 2024 warrant inducement, as well as the June, September and December 2024

private placements.

Accounting Policies Involving Management Estimates and Assumptions

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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.

significant intercompany balances and transactions have been eliminated in consolidation.

Vivos Therapeutics (Canada) Inc., Vivos Management and Development, LLC, Vivos Therapeutics DSO LLC, a Colorado limited liability company,

Vivos Airway Alliance, LLC, a Colorado limited liability company, Vivos Providers Network, LLC, a Colorado limited liability company,

Airway Integrated Management Company, LLC and Airway Intelligence Center, LLC.

Additionally, Sleep Center of Nevada, Rachakonda &

Associates, PLLC, Nevada Sleep and Airway, Patterson & Associates, PLLC, AIM – Detroit, LLC, Sleep Medicine of Detroit, P.C.,

and Sleep Dentistry of Detroit, P.C.), are not wholly owned but are controlled by Vivos and 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.

Price Allocation

account for business combinations in accordance with ASC Topic 805, Business Combinations, which requires the assets acquired and liabilities

assumed in business combinations based on their estimated fair values at the date of acquisition, which involves a number of assumptions,

estimates, and judgments, which are inherently uncertain and subject to refinement.

We determine the estimated fair values with the assistance

of valuations performed by third party specialists, discounted cash flow analysis, and estimates made by management derived from comparable

market data and cash flow projections used to value the acquired business.

Our ability to realize the future cash flows used in our fair

value estimates may be affected by changes in our financial condition, financial performance, or business strategies.

Our assumptions

and estimates are also used to allocate goodwill to our reporting units that are expected to benefit from the business combination.

the measurement period, which may be up to one year from the acquisition date, we may recognize adjustments to the assets acquired and

liabilities assumed with the corresponding offset to goodwill.

We continue to collect information and reevaluate these estimates and

assumptions quarterly and record any adjustment to our preliminary estimates to goodwill provided that we are within the measurement

Upon the earlier of the conclusion of the measurement period or final determination of the fair value of assets acquired or liabilities

assumed, any subsequent adjustments are included in our consolidated results of operations.

Refer to Note 3.

Growth Company Status

are 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, we may take advantage of certain exemptions

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

These include, but are not limited

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

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

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

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.

We currently expect to

retain our status as an EGC until the year ending December 31, 2025, but this status could end sooner under certain circumstances.

January 1, 2026, the Company is no longer 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 must comply with

the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”).

generate revenue from the sale of products and services.

A significant majority of our revenues are generated from enrolling dentists

as either (i) Guided Growth and Development VIPs;

Historically, a significant majority of our revenues are generated from enrolling

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

(ii) Lifeline VIPs;

(iii) combined Guided Growth and Development and Lifeline VIPs;

(iii) combined Guided Growth and Development and Lifeline

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 fiscal quarters prior to second quarter of 2023, and on a limited

Prior to the second quarter of 2023, the majority of

VIP enrollments were Premier VIPs.

The other, lower priced enrollments were piloted in fiscal quarters prior to second quarter of 2023,

and 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 we expect 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”), we determine revenue recognition through the following five-step model,

which entails:

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 we expect 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 ”), we determine revenue recognition through the following five-step

model, which entails:

identification

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Enrollment Revenue

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

review our VIP enrollment contracts from a revenue recognition perspective using the 5-step method outlined above.

All program enrollees,

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the contract.

right to sell is similar to a license of intellectual property because without it the VIP cannot purchase appliances from us.

to sell performance obligation includes the Vivos training and enrollment materials which prepare dentists for treating their patients

using The Vivos Method.

right to sell is similar to a license of intellectual property, because without the right, the VIP cannot purchase appliances from us.

The right to sell performance obligation includes the Vivos training and enrollment materials which prepare dentists for treating their

patients using The Vivos Method.

the right to sell is never sold outside of VIP contracts, and VIP contracts are sold for varying prices, we believe that it is appropriate

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as this approximates the rate of decline in VIPs purchasing behaviors we have observed.

Given that our alliance-based marketing and distribution model is very new and has yet to generate significant revenues,

we are in the process of developing and implementing our revenue recognition plan for revenues derived from this model.

that our alliance-based marketing and distribution model is relatively new and has yet to generate significant revenues, we are in the

process of developing and implementing our revenue recognition plan for revenues derived from this model.

Service Revenue

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are rendered.

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

also offer our VIPs the ability to provide MyoSync to the VIP’s patients as part of treatment with The Vivos Method.

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

Revenue for MyoCorrect services is recognized

Revenue for MyoSync services is recognized

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

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circumstances during the reporting period.

addition to revenue from services, we also generate revenue from the sale of our line of oral devices and preformed guides (known as

appliances or systems) to our customers, the VIP dentists, or to OSA patients directly now in our strategic alliance model.

include the DNA appliance®, mRNA appliance®, the mmRNA appliance, the Versa, the Vida, the Vida Sleep and others.

expanded our 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

Revenue from appliance sales is recognized when the control of a 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, and

installing the appliance and educating the patient as to its use.

We contract with VIPs for the sale of the appliance and are not

involved in the sale of the products and services from the VIP to the VIP’s patient.

utilize third party contract manufacturers or labs to produce its patient-customized, patented appliances and its preformed guides.

manufacturer designated by us produces the appliance in strict adherence to our patents, design files, treatments, processes and procedures

and under the direction and our specific instruction, ships the appliance to the VIP who ordered the appliance from us.

All of our contract

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

rules and regulations.

We performed an analysis and concluded it is the principal in the transaction since it has control of the product

and are reporting revenue gross.

We bill the VIP the contracted price for the appliance which is recorded as product revenue.

revenue is recognized once the appliance ships to the VIP under our direction.

addition to revenue from services, we also generate revenue from the sale of our line of oral devices and preformed tooth positioners

(known as appliances or systems) to our customers, the VIP dentists, or to OSA patients directly now in our strategic alliance model.

These include the DNA appliance®, mRNA appliance®, the mmRNA appliance, the Versa, the Vida, the Vida Sleep and others.

our 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 the control of a 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, and installing the appliance and educating the

patient as to its use.

We contract with VIPs for the sale of the appliance and are not involved in the sale of the products and services

from the VIP to the VIP’s patient.

utilize third party contract manufacturers or labs to produce its patient-customized, patented appliances and its preformed tooth positioners.

The manufacturer designated by us produces the appliance in strict adherence to our patents, design files, treatments, processes and

procedures and under the direction and our specific instruction, ships the appliance to the VIP who ordered the appliance from us.

of our contract manufacturers are required to follow our master design files in production of appliances or the lab will be in violation

of the FDA’s rules and regulations.

We performed an analysis and concluded it is the principal in the transaction since it has

control of the product and are reporting revenue gross.

We bill the VIP the contracted price for the appliance which is recorded as product

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

support of the VIPs using our appliances for their patients, we utilize a team of trained technicians to measure, order and fit each

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recorded as a liability at issuance and are deducted from the related product sale at the time the credit is used.

and Intangible Assets, Net

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

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of impairment that occurred for the year ended December 31, 2025, accordingly no impairment was required.

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

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

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

AireO2) for work related our acquired patents, intellectual property and customer contracts and (iii) AFD, from whom we acquired certain

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.

assets consist of assets acquired from First Vivos, costs paid to (i) MyoSync, (ii) Lyon Management and Consulting, LLC and its affiliates

(“Lyon Dental”), (iii) AFD, and (iv) SCN, from whom we acquired tradenames and referral relationships.

The identifiable intangible

assets acquired are amortized using the straight-line method over the estimated life of the assets, which ranges between five and 15

years (See Note 6).

of Long-lived Assets

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indicators of impairment that occurred for the year ended December 31, 2025, accordingly no impairment was required.

account for income taxes in accordance with Accounting Standards Codification (“ASC”) 740, Income Taxes, under which deferred

income taxes are recognized based on the estimated future tax effects of differences between the financial statement and tax bases of

assets and liabilities given the provisions of enacted tax laws.

Deferred income tax provisions and benefits are based on changes to

the assets or liabilities from year to year.

In providing for deferred taxes, we consider tax regulations of the jurisdictions in which

we operate, estimates of future taxable income, and available tax planning strategies.

If tax regulations, operating results, or the

ability to implement tax-planning strategies vary, adjustments to the carrying value of deferred tax assets and liabilities may be required.

account for income taxes in accordance with Accounting Standards Codification (“ ASC ”) 740, Income Taxes, under which

deferred income taxes are recognized based on the estimated future tax effects of differences between the financial statement and tax

bases of assets and liabilities given the provisions of enacted tax laws.

Deferred income tax provisions and benefits are based on changes

to the assets or liabilities from year to year.

In providing for deferred taxes, we consider tax regulations of the jurisdictions in

which we operate, estimates of future taxable income, and available tax planning strategies.

If tax regulations, operating results, or

the ability to implement tax-planning strategies vary, adjustments to the carrying value of deferred tax assets and liabilities may be

A valuation allowance is recorded when it is more likely than not that a deferred tax asset will not be realized.

The recorded valuation

allowance is based on significant estimates and judgments and if the facts and circumstances change, the valuation allowance could materially

In accounting for uncertainty in income taxes, we recognize the financial statement benefit of a tax position only after determining

that the relevant tax authority would more likely than not sustain the position following an audit.

For tax positions meeting the more

likely than not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent

likelihood of being realized upon ultimate settlement with the relevant tax authority.

We recognize interest and penalties accrued on

any unrecognized tax benefits as a component of income tax expense.

valuation allowance is based on significant estimates and judgments and if the facts and circumstances change, the valuation allowance

could materially change.

In accounting for uncertainty in income taxes, we recognize the financial statement benefit of a tax position

only after determining that the relevant tax authority would more likely than not sustain the position following an audit.

For tax positions

meeting the more likely than not threshold, the amount recognized in the financial statements is the largest benefit that has a greater

than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority.

We recognize interest and penalties

accrued on any unrecognized tax benefits as a component of income tax expense.

account for our warrants and financial instruments as either equity or liabilities based upon the characteristics and provisions of each

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discussion of recent accounting pronouncements is included in Note 1 to our financial statements contained in this Annual Report on Form

Quantitative and Qualitative Disclosures About Market Risk

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 7. Management’s Discussion and Analysis