Vivos Therapeutics, Inc.

Item 1A. Risk Factors

We are voluntarily providing in this Item 1A. updated risk factors associated with SCN, the Acquisition and related matters.

In 2024 and 2025, we worked to pivot our sales, marketing distribution model, including via the acquisition of the Sleep Center of Nevada (the Acquisition). However, this new model is unproven and may not produce the benefits we anticipate. This makes it difficult to evaluate our future prospects and may increase the risk of your investment.

In June 2025, we acquired all assets, including operating assets such as sleep testing, diagnostics, and treatment centers, of SCN. The Acquisition marked the completion in a pivot to our 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 consulting revenues, representing new higher margin revenue streams for us, as well as potential Vivos appliance sales revenue from SCN. We are exploring and seeking to implement additional acquisitions of, or collaborations with, medical sleep and similar healthcare practices to expand our business model in an effort to grow our revenues.

We are placing significant emphasis on establishing and growing this new model as means of increasing our revenue. However, this new model is unproven, and we have limited operating history associated with this new model. Our prior collaboration with Rebis Health in Colorado entered into in 2024 has not met our expectations and differed materially from the SCN acquisition in that we did not have adequate control over patient processing, systems and protocols, dentist hiring and management, staff hiring and management, patient education, hours of operation, or medical provider training and education. As a result, the Rebis Health collaboration has not benefited us as we had anticipated. There is therefore a lack of information for you to evaluate our future prospects utilizing this new model.

Moreover, there is a material risk that this new model will not increase our revenues or gross margins in the manner we anticipate. For example, we have faced challenges in fully integrating SCNs operations into our own and meeting market demand due to matters such as (i) difficulties in identifying and training healthcare providers in the products and services we offer and (ii) obtaining insurance reimbursement for such products and services. Our ability to address these and similar challenges could lead to slower increases, or even reductions, in our revenues.

In addition, we may be unable to find additional sleep medical providers to incorporate into our business, and even if we do, the is a risk we may not derive the benefits from additional acquisition that we intend to. Our inability to implement and scale this marketing and distribution model would materially harm our business and operating results and likely cause our stock price to suffer.

Additionally, if the benefits of the Acquisition or similar acquisitions or collaborations we may undertake do not meet the expectations of our shareholders, the market price of our securities may decline. Fluctuations, including declines, in the price of our common stock could contribute to the loss of all or part of your investment. Certain factors, including, but not limited to, the factors listed below could have a material adverse effect on the price of our common stock:

As such, no assurances can be given that the Acquisition or similar transactions will benefit our operating results or stock price.

We have incurred substantial indebtedness in connection with financing the SCN acquisition, the cost of servicing that debt could adversely affect our business, financial condition, and results of operation, and we may not be able in the future to service that debt.

Concurrently with the SCN Acquisition, we entered into a Note Purchase Agreement with Streeterville Capital, LLC, a Utah limited liability company (Lender), pursuant to which we issued and sold to Lender a Secured Promissory Note in the original principal amount of $8,250,000 (the Note). The Note is secured by our wholly-owned subsidiary AIM, which manages SCN in accordance with the corporate practice of medicine. The Company has also pledged the entirety of AIMs membership interests to the Lender as collateral for the Loan pursuant and caused AIM to provide a guarantee of our obligations to the Lender under the Note and the other transaction documents.

Our ability to make scheduled payments under the Note or any alternative debt financing arrangements we may enter into in connection with our growth strategy to acquire additional medical sleep practices will depend on our financial and operating performance, which will be affected by economic, financial, competitive, business, and other factors, some or all of which are beyond our control. The indebtedness we incurred in connection with the Acquisition will require us to dedicate a portion of our cash flow to servicing this debt, thereby reducing the availability of cash to fund other business initiatives. There can be no assurance that our business, inclusive of SCN, will generate sufficient cash flow from operations to service our indebtedness or to fund our other liquidity needs. If we are unable to meet our debt obligations or fund our other liquidity needs, we may need to restructure or refinance all or a portion of our indebtedness on or before maturity or sell certain of our assets. There can be no assurance that we will be able to restructure or refinance any of our indebtedness on commercially reasonable terms, if at all, which could cause us to default on our debt obligations and impair our liquidity. Any refinancing of our indebtedness could be at higher interest rates and may require us to comply with more onerous covenants, which could further restrict our business operations. If we are unable to generate or borrow sufficient cash to make payments on our indebtedness, our business, financial condition, and results of operations could be adversely affected.

Integrating SCNs operations may be more difficult, costly, or time-consuming than expected.

The ongoing integration of Vivos and SCN could result in the disruption of our ongoing business, and inconsistencies in standards, controls, procedures, policies and insurance coverage that adversely affect our ability to maintain relationships with patients and employees or achieve the anticipated benefits of the Acquisition. As with any acquisition, there also may be disruptions that cause us to lose patients or cause patients to elect alternative form of sleep treatment. We may also face other unintended consequences from the Acquisition (including adverse effects on our business reputation, supply chain issues, and similar matters) that that could have a material adverse effect on our results of operations, financial condition and stock price.

If our contractual arrangements between AIM and our physicians at SCN are found to constitute the improper rendering of medical services or fee splitting under applicable state laws, our business, financial condition and our ability to operate in those states could be adversely impacted.

Our contractual relationships between AIM and our physicians at SCN (and similar arrangements we may enter into in the future in connection with other sleep provider acquisitions) may implicate certain state laws that generally prohibit non-professional entities from providing licensed medical services or exercising control over medical practitioners or other healthcare professionals (such activities generally referred to as the corporate practice of medicine, and laws, rules and regulations relating to the corporate practice of medicine, the CPM Laws) or engaging in certain practices such as fee-splitting with such licensed professionals. The interpretation and enforcement of CPM Laws vary significantly from state to state. There can be no assurance that CPM Laws will be interpreted in a manner consistent with our practices or that other laws or regulations will not be enacted in the future that could have a material and adverse effect on our business, financial condition and results of operations. Regulatory authorities, state boards of medicine, state attorneys general and other parties may assert that, despite the agreements through which we operate, we are engaged in the provision of medical services and/or that our arrangements with our medical practitioners constitute unlawful fee-splitting. If a jurisdictions prohibition on the corporate practice of medicine or fee-splitting is interpreted in a manner that is inconsistent with our practices, we would be required to restructure or terminate our arrangements with our medical practitioner at SCN to bring our activities into compliance with such CPM Laws. A determination of non-compliance, or the termination of or failure to successfully restructure these relationships could result in disciplinary action, penalties, damages, fines, and/or a loss of revenue, any of which could have a material and adverse effect on our business, financial condition and results of operations. State corporate practice and fee-splitting prohibitions also often impose penalties our medical practitioners for aiding in the improper rendering of professional services, which could discourage medical practitioners and other healthcare professionals from providing clinical services at SCN or other sleep centers we may operate in the future.

As a result of our business model pivot which includes the acquisition of sleep centers like SCN, we may become a party to lawsuits, demands, claims, qui tam suits, governmental investigations and audits and other legal matters, any of which could result in, among other things, substantial financial and other penalties, damage to our reputation or adverse effects on our ability to conduct business.

As a result of our 2025 business model pivot, which includes acquisitions of sleep medical providers like SCN as a means of driving sales of our OSA treatments, our business has (subject to compliance with CPM laws as described above) become more associated with diagnosing and treating OSA patients. Given the nature of this business, we may in the future be subject to investigations and audits by governmental agencies, private civil qui tam complaints and other lawsuits, demands, claims, legal proceedings and/or other actions alleging our, or the medical practices we manage, failure to comply with applicable rules, regulations, laws or the practice of medicine.

For example, we and sleep medical providers we manage (like SCN) could become subject to audits from the government concerning the billing of patients. If, following the conclusion of any audit, the government were to require refunds and/or modifications to our business practices, and such amounts or changes are significant, it could have a material adverse effect on our business, results of operations, financial condition and cash flows. In addition, any allegation against us, our medical providers we manage or related personnel, representatives, third party vendors, or operations in such matters or matters that involve patients suffering adverse health outcomes, may, among other things harm our reputation, stock price, and adversely affect our relationships and/or contracts related to our business, among other things.

Responding to subpoenas, investigations and other lawsuits, claims and legal proceedings, as well as defending ourselves in such matters, would require managements attention and cause us to incur significant legal expense. Negative developments, findings or terms and conditions that we might agree to accept as part of a negotiated resolution of pending or future legal or regulatory matters, or have been forced upon us, could result in, among other things, harm to our or our medical providers reputation, substantial financial penalties or awards against us, substantial payments made by us, required changes to our business practices, impacts on our various relationships and/or contracts related to our business, exclusion from future participation in Medicare, Medicaid and other healthcare programs and, in certain cases, criminal penalties, any of which could have a material adverse effect on us.

Changes in the structure of and payment rates under private insurance, Medicare, Medicaid or other non-Medicare government-based programs or payment rates related to our business could have a material adverse effect on our business, results of operations, financial condition and cash flows.

Sleep center providers like SCN or other medical sleep providers we may acquire and manage or do business with rely on various forms of insurance held by patients for payment for products and services. These include private insurance, Medicare, Medicaid and other government programs. As such, the business of the medical sleep providers we manage and our business and results of operations could be adversely impacted by matters related to insurance coverage including, without limitation:

If we are faced with these or similar risks, we could face material adverse consequences on our business, results of operations, financial condition and cash flows.

Our business and the medical practices we manage are labor intensive. Our inability to recruit qualified talent and manage labor costs or shortages result could result significant increases in our operating costs, decreases in productivity, and disruptions in our business operations.

Our business and the business of the medical practices we manage is labor intensive. This is particularly true with respect to the Sleep Optimization (SO) teams we are putting in place at SCN, each consisting of one nurse practitioner (or physicians assistant), two specially trained dentists, six dental assistants, six administrative support personnel, and one treatment navigator. Labor requirements also exist, albeit to a lesser extent, for contractual alliances with medical sleep providers we may enter into. We face increased labor costs and the risk of difficulties in hiring skilled clinical personnel. The healthcare labor market for the talent we require is challenging and experiences volatility, uncertainty and labor supply shortages. We may be unable to achieve the financial results we desire from the SCN acquisition, the acquisition of other medical sleep providers or our contractual alliances due to variations in labor-related costs and the productivity our personnel.

We have incurred and, as we seek to scale our business, expect to continue to incur increased labor costs, including through elevated compensation levels to our personnel, the ultimate extent of which will depend on the needs at SCN or other medical sleep providers we acquire as well as macroeconomic conditions and ancillary impacts on the labor market, among other things.

We compete for qualified talent with hospitals and other healthcare providers. Furthermore, changes in certification requirements could adversely impact our ability to maintain sufficient staff levels, including to the extent our personnel are not able to meet new requirements. In addition, if we experience a higher than normal turnover rate for our skilled clinical personnel, our operations and ability to meet patient demand may be negatively impacted, which could adversely affect our business, results of operations, financial condition and cash flows.

Also, political or other efforts at the national or local level could result in actions or proposals that increase the likelihood of success of union organizing activities at the facilities we manage. If a significant portion of our personnel were to become unionized, we could experience, among other things, potential additional work stoppages or other business disruptions; adverse impacts to our financial results due to the costs of bargaining or implementing a grievance procedure and processing grievances, decreases in our operational flexibility and efficiency, or negative impacts on our employee culture. Any of these events or circumstances, including our responses to such events or circumstances, could have a material adverse effect on our employee relations, treatment growth, productivity, business, results of operations, financial condition, cash flows and reputation.Not applicable to smaller reporting companies.