Vivos Therapeutics, Inc. (VVOS) Earnings Call Transcript & Summary

Good afternoon. On behalf of our Board of Directors and our officers and employees, I would like to welcome everyone to the 2024 Annual Meeting of Stockholders of Vivos Therapeutics, Inc., which is being held via live webcast. I am Kirk Huntsman, Chief Executive Officer and Chairman of the Board of Directors of Vivos. I will act as Chair of this meeting. Here with me today is Brad Amman, our Chief Financial Officer, Secretary and Treasurer, who will act as the Secretary of the meeting; and Donna Ackerly of Lioness Consulting, our proxy solicitation adviser, who has been appointed as the Inspector of Election of this meeting. Also present today in listen-only mode are the members of our Board of Directors as well as many of our employees and our outside legal counsel. As we did last year, we are pleased to hold our annual meeting virtually via the Internet. Virtual shareholder meetings are increasingly in prevalence and allow for improved access and increased attendance. By hosting our meeting virtually, all of our shareholders are more easily able to attend. All stockholders of record on October 4, 2024, are eligible to vote either by proxy or virtually at this meeting. If you have already submitted a proxy to the company and do not wish to change your vote, you do not have to vote again. However, if you are a record holder as of the record date and have not submitted a proxy or if you desire to change your vote, you may receive a proxy card and vote now by e-mailing our proxy solicitation adviser, Donna Ackerly of Lioness Consulting at [email protected]. This information is on our screen. Donna is also available at that e-mail to assist our Street name holders as well. We will now move forward to conduct the business of today's meeting. The first part of the meeting will be to conduct the business of the 2024 Annual Meeting of Stockholders as set forth in our proxy materials. We will not be taking questions during the formal business part of the meeting. Following the close of the formal portion of the meeting, we will have a question-and-answer period. As Chair of this meeting, I reserve the right to answer such questions as I deem appropriate. If you wish to submit a question for the Q&A session, please submit your questions in writing using the Q&A option at the bottom of your screen. I'd now like to introduce Brad Amman, our Chief Financial Officer, who will provide our forward-looking statement disclaimer. Brad?

Good afternoon, and welcome. Please note that various remarks that Vivos' personnel may make at this meeting about management's future expectations, plans, prospects for the company constitute forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995 and related provisions of the U.S. federal securities laws. These statements include, without limitation, statements regarding our business plans and strategies or compliance with applicable regulatory requirements and future trends related to our business and the market in which we operate. You are cautioned that actual results may differ materially and adversely from those indicated by these forward-looking statements as a result of various important factors, including those discussed in the Risk Factors section of our most recent annual report on Form 10-K, which is on file with the SEC and other filings on Form 10-Q and Form 8-K that we make with the SEC as well as our press releases. In addition, these forward-looking statements represent our management's expectations only as of today. While Vivos may elect to update these forward-looking statements, it specifically disclaims any obligation to do so, except as may be required by law. Any forward-looking statements should not be relied upon as representing our management's estimates or views as of any date subsequent to today. Finally, please be aware that the U.S. Food and Drug Administration has given certain Vivos appliances specific 510(k) clearances to treat mild-to-severe OSA with the FDA clearance for severe OSA last November and more recently, the pediatric FDA clearance for treating moderate-to-severe OSA in children ages 6 to 17. The treatment of patients with severe OSA with Vivos-specific appliances is now no longer needed to be performed off-label at the clinical discretion of the treating doctor and is now an integral part of the Vivos treatment protocol. Any statements made today regarding Vivos treatment or the Vivos method should be viewed in that context. Treatment of OSA of any severity or any other sleep, breathing or other condition with any other Vivos FDA-cleared devices remains at the clinical discretion of the treating doctor. Thank you, and back to you, Kirk.

Thank you, Brad. As mentioned, Donna Ackerly has been duly appointed as Inspector of Election for today's meeting. Prior to the meeting, Donna provided her executed oath of office, whereby she has been sworn to faithfully perform the duties of Inspector of Election with impartiality according to the best of her ability. Donna?

Thank you, Kirk. The record date for determining the holders of common stock entitled to notice of and to vote at this meeting was October 4, 2024. I have in my possession a list of stockholders as of the close of business on the record date. This list will be filed with the records of the company. I'm also in possession of an affidavit of the Stock Transfer, the company's transfer agent, attesting that the notice of annual meeting and proxy materials, the 2023 annual report and form of proxy card were mailed commencing on or about October 15, 2024, to each stockholder of record at the close of business on the record date. This affidavit of mailing, along with the proxy materials will be annexed to the minutes of this meeting. On the record date, there were 4,765,300 shares of common stock issued, outstanding and entitled to vote at this meeting. Each share of common stock is entitled to 1 vote. For a quorum to be present, a majority of the shares entitled to vote must be present at this meeting. Prior to the meeting, as Inspector of Election, I submitted a report of the number of shares of common stock present or represented by proxy at this meeting. This report shows that represented at this meeting, there are either in person or by proxy approximately 2,695,565 shares of common stock of the company out of a total of 4,765,300 shares of common stock issued, outstanding and entitled to vote at this meeting. This constitutes approximately 56.6% of the company's outstanding shares of common stock entitled to vote at this meeting. Therefore, I declare there is a quorum present at this meeting for the transaction of business. Back to you, Kirk.

Thank you, Donna. We will now proceed with the matters to be voted upon at the meeting. The polls are open online and will remain open until after each of the matters to be presented at the meeting has been submitted. The first item of business is the election of directors for the coming year. A Board of Directors of 6 members is to be elected to serve until the next Annual Meeting of Stockholders or until their successors shall be elected and qualified. The following persons have been nominated to serve as directors: Dr. Ralph Green, Anya Krammer, Mark Lindsay, Leonard Sokolow, Dr. Matthew Thompson and R. Kirk Huntsman. In my capacity as a stockholder, I hereby move that the foregoing persons be nominated for election as directors. Would a stockholder second the motion and also please state their name.

My name is Jennifer Hauser, and I am a stockholder of the company. I second the motion.

Since no further nominations have been made or now can be made under The company's bylaws, the nominations for director are closed. The second item of business to come before this meeting is a proposal to adopt and approve Vivos' Proposed 2024 Omnibus Equity Incentive Plan and the issuance of contingent awards under the 2024 plan to certain officers and employees. This proposal will adopt the 2024 plan, which will allow Vivos to issue up to a total of 1,600,000 shares of common stock for future awards. This proposal will also allow Vivos to issue previously approved option awards under the 2024 plan to certain of Vivos' officers, employees and consultants as described in the proxy statement for this meeting. In my capacity as a stockholder, I hereby move that this proposal proceed. Would a stockholder second the motion and also please state their name?

My name is Jennifer Hauser, and I am a stockholder of the company. I second the motion.

The final item of business is to ratify the appointment by the Audit Committee of the Board of Directors of the company of the firm of Moss Adams LLP as Vivos' independent registered public accounting firm for fiscal year ended December 31, 2024. In my capacity as a stockholder, I hereby move that the foregoing motion proceed. Would a stockholder second the motion and also please state their name?

My name is Jennifer Hauser, and I am a stockholder of the company. I second the motion.

All matters to be voted on at this meeting have now been presented. If you have not already voted or you would like to change your vote, please do so now by e-mailing Donna Ackerly of Lioness Consulting at [email protected] as I described earlier. A majority of the votes cast at this meeting is required to approve each of the matters presented at this meeting. We will pause for a moment to ensure that those wishing to vote now may finish doing so. [Voting]

At this time, everyone should have completed voting. This concludes the presentation of the business items on the agenda for this annual meeting. The polls are now closed. We will now pause for a moment to allow the Inspector of Elections to make any adjustments due to voting that occurred at this meeting. I now ask Ms. Ackerly to present her report as Inspector of Election on the preliminary results of the voting. Ms. Ackerly?

The election of directors. Each of the director nominees has received a majority of the votes cast at this meeting, and therefore, each of the director nominees is elected as a director for a 1-year term, concluding at the next Annual Meeting of Stockholders or until their successors shall be elected and qualified. For the proposal to adopt -- approve and adopt Vivos' Proposed 2024 Omnibus Equity Incentive Plan and the issuance of contingent awards under the 2024 plan, a majority of the votes cast on this proposal have voted in favor of this proposal. Therefore, this proposal has been approved. For the ratification of auditors, a majority of the votes cast at this meeting have voted in favor of this proposal. Therefore, this proposal has been approved. I shall file the final report of the Inspector of Election in the corporate records of the company.

Thank you, Ms. Ackerly. As there is no further business to come before this meeting, I would now like to adjourn the formal business portion of this meeting. I will then open up the meeting for appropriate questions from stockholders. In my capacity as a stockholder, I hereby move that the meeting be adjourned. Do I hear a second motion to adjourn this formal part of this meeting?

My name is Jennifer Hauser, and I am a stockholder of the company. I second the motion.

I declare the formal part of this meeting adjourned. Thank you to our shareholders for your support. We will now have a brief Q&A session. Please note that as Chair of this meeting, I have the ability to deem questions inappropriate.

Brad, will you read that question out loud for me?

Given the pivot to the new Vivos business model 2.0, what kinds of strategic opportunities will present themselves to Vivos and why may they be of interest?

Thank you. I appreciate that question. And one important thing that I can say is that there is no shortage of opportunities that we are fielding from the marketplace in general from really like-minded firms engaged in the testing and diagnosis of obstructive sleep apnea across the country that are anxious to avail themselves of some sort of alliance or even possibly an acquisition pertaining to the value proposition that Vivos represents and brings. A lot of these testing companies operate off of a model that requires a high volume of patients to be tested with relatively low margins and that is not true for Vivos. Vivos brings to those people and to those companies an opportunity for those patients to avail themselves of our -- as we referenced earlier, the newly FDA-cleared treatment modalities that only Vivos has and that only Vivos can make available through one of our centers or through one of our Vivos-aligned doctors. So we are very excited about the market reception that we've received so far, both on a sort of a more global basis as well as what we've been doing at our previously announced project here in Colorado with CSI and Rebis Health. We have seen some really good uptake from patients. We've seen some really good acceptance of Vivos and the preference that they have for Vivos treatment over alternatives. And so being able to give patients a choice, informing them of all their treatment options appears to be a real sweet spot in the marketplace that no one else has really done for these people, and it's being received extraordinarily well. So we're very excited as we round out the year and the fourth quarter here of 2024. We're very excited about not only what's happening here in Colorado, but also what's happening with respect to just a number of very exciting opportunities around the country that represent thousands and thousands of additional patients who will soon be exposed to Vivos as a viable treatment modality for their sleep apnea. Let's see here. Next question. Brad, can you read that for me?

Can you provide some updates on the progress of the clinical trial at Stanford?

Yes. What I can tell you is that things appear to progress rather slowly at Stanford despite a lot of enthusiasm and leadership from Dr. Clete Kushida, who chairs our Clinical Advisory Board. I spoke with Clete this last week, and it just takes a little bit of time for them to get going on enrollments and that sort of thing. So unfortunately, that's not proceeding as rapidly as any of us would like to see it proceed. But that doesn't mean that we aren't continuing to make progress along the research front, and it doesn't mean that we aren't gathering important data from patients and from providers literally around the world with respect to our treatment and the treatment modalities that we engage in. We're now up over 50,000 patients that have been treated in this. We continue to monitor and garner important market data -- clinical data on things. And we do continue apace with our clinical trial for children, which we are conducting here in Colorado, and we're up probably in the neighborhood now of 125 to 140 pediatric patients that have been enrolled in that trial and have undergone treatment, and we're excited about the outcomes that we're seeing from that and expect to be able to publish that here in this next upcoming year. So even though Stanford is off to a little bit of a slower start than what we had hoped, we're continuing to make progress, and we're not letting that deter us. Okay. There are no further questions at this time. I would like to just make mention of one other development here that I think is important, and that is the successful completion of our initial training sessions over in the Middle East. Working in close collaboration with our Middle East distributor, Noum, N-O-U-M, we conducted recently our very first clinical training over there. It was very successful by all accounts. And we've actually seen a little bit of a surge in patients from that area and providers seeking to get their patients into treatment. And so we expect that, that area will continue to blossom and develop as we move forward, and we're off to a great start there. We'll be returning there right after the first of the year with further training, and it feels like there's a lot of momentum and a lot of enthusiasm in that part of the world. for what Vivos represents. So I wanted to just make that announcement and update. And then it doesn't appear that there is -- there are any further questions at this time. So with that, we will go ahead and close off the questions and wrap the meeting up. Again, I would like to express on behalf of all of us here at Vivos, management, Board of Directors, et cetera, our just deep appreciation for all the shareholders and their support, not only of our proposals but of all the things that we're attempting to do here at Vivos. We fully expect that 2025 will be a watershed year for this company, and we will begin to realize the clear potential that this company and its technology has for the future. And so with that, I'd like to wish everyone a very happy Thanksgiving holiday here in the U.S. and wonderful holiday season overall. And thank you very much as we look forward to 2025. Thank you.