Champion Pain Care Corp - FORM 10-K

Attached files

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EX-32.1 - EXHIBIT 32.1 - Champion Pain Care Corp	f10kexhibit32114apr16.htm
EX-31.1 - EXHIBIT 31.1 - Champion Pain Care Corp	f10kceoexhibit31114apr16.htm
EX-31.2 - EXHIBIT 31.2 - Champion Pain Care Corp	f10kcfoexhibit31214apr16.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

ANNUAL REPORT PURSUANT TO SECTIONS 13 OR 15 (d) OF THE SECURITIES AND EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2015

Commission file number: 333-162084

Champion Pain Care Corporation

(Exact Name of Registrant as Specified in its Charter)



Delaware		27-0625383
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

48 Wall Street, 10^th Floor

New York, NY 10005

(Address of Principal Executive Offices)

Registrant’s telephone number, including area code: 775-546-0311

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to section 12(g) of the Act:

Common Stock, $0.0001 par value

(Title of class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined by Rule 405 of the Securities Act. Yes . No X .

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act. Yes . No .

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes . No X

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. .

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):



Large accelerated filer	.	Accelerated filer	.
Non-accelerated filer	. (Do not check if a smaller reporting company)	Smaller reporting company	X .

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes . No X

For the years ended December 31, 2014 and 2015, the issuer had no revenues.

As of December 31, 2015, there was a limited trading market for the issuer’s common stock, $0.0001 par value.

The number of shares outstanding of the issuer’s common stock, $0.0001 par value, as of April14, 2016 was 119,438,500 shares.

DOCUMENTS INCORPORATED BY REFERENCE

Champion Pain Care Corporation

Form 10-K Annual Report

Table of Contents




PART I
Item 1.	Business	3
Item 1A.	Risk Factors	18
Item 1B.	Unresolved Staff Comments	31
Item 2.	Properties	31
Item 3.	Legal Proceedings	31
Item 4.	Mine Safety Disclosures	31
PART II
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	32
Item 6.	Selected Financial Data	33
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	33
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	38
Item 8.	Financial Statements and Supplementary Data	38
Item 9.	Change in and Disagreements with Accountants on Accounting and Financial Disclosure	38
Item 9A.	Controls And Procedures	38
Item 9B.	Other Information	39
PART III
Item 10.	Directors, Executive Officers, and Corporate Governance	40
Item 11.	Executive Compensation	42
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	43
Item 13.	Certain Relationships and Related Transactions, and Director Independence	43
Item 14.	Principal Accountant Fees and Services	46
PART IV
Item 15.	Exhibits and Financial Statement Schedules	47

EXPLANATORY NOTE

Unless otherwise indicated or the context otherwise requires, all references in this Form 10-K to “we,” “us,” “our,” or “the Company” refer to Champion Pain Care Corporation (“Champion”).

PART I

This report may contain forward-looking statements within the meaning of Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, or the Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements are based on our management’s beliefs and assumptions and on information currently available to our management and involve risks and uncertainties. Forward-looking statements include statements regarding our plans, strategies, objectives, expectations and intentions, which are subject to change at any time at our discretion. Forward-looking statements include our assessment, from time to time of our competitive position, the industry environment, potential growth opportunities and the effects of regulation. Forward-looking statements include all statements that are not historical facts and can be identified by terms such as “anticipates,” “believes,” “could,” “estimates,” “expects,” “hopes,” “intends,” “may,” “plans,” “potential,” “predicts,” “projects,” “should,” “will,” “would” or similar expressions.

Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. We discuss many of these risks in greater detail in “Risk Factors.” Given these uncertainties, you should not place undue reliance on these forward-looking statements. Also, forward-looking statements represent our management’s beliefs and assumptions only as of the date of this report. You should read this report and the documents that we reference in this report and have filed as exhibits to the report completely and with the understanding that our actual future results may be materially different from what we expect. Except as required by law, we assume no obligation to update these forward-looking statements publicly, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.

ITEM 1. BUSINESS

Our History

We were incorporated as OICco Acquisition I, Inc. on July 24, 2009, under the laws of the State of Delaware, as a special purpose acquisition company. On November 15, 2012, we closed on the acquisition of Imperial Automotive Group (“IAG”), a limousine and specialty vehicle manufacturing company incorporated under laws of the state of Florida in exchange for 40,000,000 shares of our common stock (the “IAG Shares”). IAG was a limousine and specialty vehicle manufacturing company with experience in the creation and restoration of custom and classic automobiles. In December, 2012, IAG changed its business plan to begin operations as a marketer and distributor of automobiles, small buses, specialty vehicles, limousines and custom vehicles. In July, 2013, we decided to abandon IAG’s business and negotiated the return of the IAG Shares which were subsequently cancelled. IAG remains a non-operational subsidiary of the Company.

On May 29th 2013, we entered into a Share Exchange Agreement and Plan of Reorganization (the “Exchange Agreement”) with Champion Pain Care Corp. (“CPCC”), a Nevada corporation. On October 18, 2013 and pursuant to the terms of the Exchange Agreement, 31,500,000 shares of our $0.0001 par value common stock (the “Common Stock”) were issued to Champion Care Corp., a Canadian corporation (“Champion Toronto”), in exchange for all of the issued and outstanding shares of common stock of CPCC owned by Champion Toronto. Upon completion of the foregoing transactions, CPCC became our wholly-owned subsidiary. On October 31, 2014, the name of the Company was changed to Champion Pain Care Corporation and a new ticker symbol, CPAI, and CUSIP number, 158571109, were assigned.

Our Company

We are a pain management company that has licensed the rights in the United States to a proprietary pain management protocol, the Champion Pain Care Protocol (the “Protocol”), from our principal shareholder, Champion Toronto. We intend to acquire private medical clinics throughout the United States that specialize in the treatment and management of chronic pain and add the Protocol to the treatments already provided by acquired clinics.

Our Industry

It is estimated that 1.5 billion people are affected by chronic pain globally (Anon., 2011a; Anon. 2012) including from 100 Million (Anon., 2011b) to 116 Million Americans (Bisbee et al. 2011) making it the number one reason patients seek medical care (Anon. 2011). Bisbee et al. (2011) provide a review of literature that quantifies the magnitude of the costs that are attributed to chronic pain in the United States and describes the following examples:

The annual cost of chronic pain in the United States, including direct medical costs, lost income, and lost productivity, is estimated to be $635 billion. In comparison, the estimated annual costs in 2010 dollars of heart disease, cancer and diabetes was $309, $243 and $188 billion, respectively.

Total estimated medical costs associated with back and neck pain, two of the commonest types of chronic pain, increased by 65% between 1997 and 2005, to about $86 billion a year.

The estimated annual direct medical cost of low back pain alone is $30 billion. The impact of back pain is $100-200 billion in decreased wages and lost productivity.

Patients with chronic pain have more hospital admissions, longer hospital stays, and unnecessary trips to emergency rooms.

Other studies, including private sector market and corporate reports, have quantified the direct costs of chronic pain as described below.

The U.S. market for pain-management therapeutics is estimated to grow to $60 billion by 2015 (Anon., 2011a). This market consists of prescription and OTC medications, patient-controlled dosing, implants, and electrical stimulation.

In 2011, the market for pain medications totaled $20 billion in the U.S. (Anon., 2013a). In 2010, opioid analgesics accounted for approximately $8.3 billion of those sales which included $3.1 billion for the market leader, Oxycontin^® (Anon., 2011c).

Even though there is information available on the overall market size for pain treatment and management and for pain medications in the United States, there is little information available on our targeted market, private clinics that specialize in pain management. To gain a better understanding regarding private pain management practices we did our own market research.

Our market research

In August 2012, we identified 285 cities in the U.S. with populations greater than 100,000 as of July, 2011 on Wikipedia (http://en.wikipe dia.org/wiki/List_of_United_States_cities_by_population). That information has now been updated with estimates of population for July 2013 and, at that time, 295 cities exceed populations of 100,000.

We used the search engine provided for the SummaCare Medicare Advantage plans to estimate the number of doctors and private clinics specializing in pain medicine that were registered with this agency in each of the 285 cities with populations of 100,000 or more that were identified in July, 2011.

In all cities, we counted the number of doctors located at each address and, were able to identify those doctors practicing at public institutions and eliminate them from the estimate of doctors practicing in private clinics By doing so, we estimated that in August 2012 there were 1,339 private clinics and 2,022 doctors at those clinics specializing in pain medicine in the United States that were registered with the SummaCare Medicare Advantage Multiplan.

We also conducted a random check to see if another insurance provider had these same clinics registered in the selected cities and, in most cases, we determined, that most clinics were registered with more than one agency. In other cases, clinics registered with SummaCare did not appear to be registered with the other agency that was used for the cross check.

Since there is not a complete overlap of doctors registered with the various agencies, we assumed that there are approximately 1,500 private clinics with as many as 2,500 doctors specializing in pain medicine in the United States. Also, we did not consider any centers with fewer than 100,000 people. These factors likely explain why an independent study estimated that there are 6,801 doctors specializing in pain management in the United States (Anon., 2013b) since that estimate would have included doctors in smaller centers and in public institutions.

As part of our due diligence on acquisition targets, we examined the financial statements of 10 clinics specializing in pain management. Eight of these clinics had a sole practitioner while the larger two clinics had 3 and 5 practitioners, respectively, for an aggregate of 16 doctors. These 10 clinics, with an average of 1.60 doctors per clinic, were representative of the clinics we identified in our research which showed that all 1,339 clinics had an average of 1.52 doctors per clinic. The total revenues for the 10 clinics we examined were approximately $26 Million for 2012 or $1.6 Million per doctor with a range from $500,000 to $3,200,000. The 95% Confidence Interval for revenues per doctor is approximately $800,000 to $2,000,000. Assuming that there are 2,500 doctors practicing in private clinics specializing in pain management in the United States, we estimate that the total annual market for private pain management clinics is at least $2 Billion based on the current structure of the market, procedures provided by the clinics and management by doctors.

Our research also revealed that the market for private pain management clinics is very fragmented. Of the 1,339 clinics identified in our investigation, 91.2% had one or two doctors, 7.5% had 3 to 4 doctors and 1.3% had more than 4 doctors. This observation is corroborated by a study of the number of doctors in all practices in the United States which surveyed 264,742 medical offices and observed that 70.9% of these offices had 1 or 2 doctors, 18.7% had 3 to 5 doctors and 10.4% had 6 doctors or more (Anon., 2013c).

Our strategy

Our strategy is to bring clinics that are operating in this fragmented market under the ownership of our company and provide professional management and additional sources of revenue through accreditation and the ancillary services described below. By doing so, we believe that we can continually improve on our services, develop competitive advantages and build a national brand for the treatment and management of chronic pain. We do not expect to generate any revenues until we complete the acquisition of our first clinics.

Establish standard operating procedures (“SOP’s”) and best practices

After acquiring clinics specializing in pain management, we intend to continue their businesses as before but also implement SOP’s that will bring efficiencies and economies of scale to the clinics that individual doctors or partnerships of doctors are not able to achieve on their own. We believe that these SOP’s will bring consistency, efficiency and economy to such activities as human resources, compliance, regulatory affairs, marketing, management, accounting, purchasing, billing and legal services. As clinics are acquired, we expect to find that certain clinics will have “best practices” that can be implemented in other clinics we own.

Implement the Protocol

In addition to continuing existing business practices of the clinics, implementing SOP’s and best practices, we also intend to augment the services provided by our clinics by implementing the Protocol. In a pilot study conducted in a clinic in Ohio, revenues of $200 per patient per 30 minute visit were generated by the Protocol under two specific Current Procedural Terminology Codes (“CPT”). The results of this and another pilot study are reported elsewhere herein. With accreditation, the revenues increase with the additional treatments that are approved for reimbursement.

Accreditation

CARF International (“CARF”, www.carf.org) is an organization that provides international accreditation for Medical Rehabilitation, including pain management therapies. CARF accreditation ensures that standardized service will be provided in all clinics that adopt the Protocol. CARF accreditation increases the number of CPT billing codes that are eligible for reimbursement. Securing CARF accreditation is expected to provide an increase in revenues for each patient treated with the Protocol.

Addition of ancillary services and facilities

In addition to supplementing treatments originally provided by our acquired clinics with the Protocol, we intend to add ancillary services and facilities with the assistance of health care professionals such as nurse practitioners, pharmacists, physiotherapists, dieticians, counsellors, and rehabilitation specialists. Additional revenues can be realized by establishing facilities such as pharmacies, physical therapy clinics and rehabilitation centers.

Factors affecting our market

New restrictions on opioids

The FDA has stated that extended-release and long-acting (“(ER/LA)”) opioids, such as oxycodone, are extensively prescribed incorrectly, misused, and abused, leading to overdoses, addiction, and even deaths across the United States. (Anon. 2011d). This view is corroborated by reports from the Centers for Disease Control and Prevention (Anon., 2012; Anon., 2013e) that opioid pain relievers such as oxycodone, hydrocodone, and methadone, were involved in 14,800 overdose deaths in 2008, 15,597 in 2009 and 16,651 in 2010. These deaths in 2008 were more than overdose deaths from cocaine and heroin combined and, for every death, there are 10 treatment admissions for abuse, 32 emergency department visits for misuse or abuse, 130 people who abuse or are dependent and 825 non-medical users (Anon., 2011e).

Because of concern over overdose deaths caused by opioids, the White House, on April 19, 2011, announced a plan aimed at reducing the “epidemic” of prescription drug abuse and the diversion of prescription drugs for recreational use in the United States by expanding, through law enforcement, state-based prescription drug monitoring programs and reducing the number of “pill mills” and doctor-shopping. (Anon., 2011d).

On September 10, 2013 the U.S. Food and Drug Administration (“FDA”) announced labeling changes and new study requirements for all ER/LA opioid analgesics intended to treat pain. (Anon., 2013e). The new requirements are that ER/LA opioids are only to be used for the management of pain severe enough to require daily, around-the-clock, long-term opioid treatment for which alternative treatment options are inadequate.

We believe that these controls over the use of opioid pain medications is a positive externality for our business because making the availability of pain medications more difficult should cause patients to seek alternative pain management treatments.

Chronic pain not a priority.

Despite the prevalence and incidence of chronic pain, affected patients appear to be poorly served. Bisbee et al. (2011) undertook an extensive survey of health care executives in 87 large health care systems relating to the management of chronic pain in the United States and made the following observations from the respondents to the survey:

77% rated the strength of their chronic low back pain programs as somewhat, minimally or not effective.

18% of respondents ranked chronic pain in the top one-third of their health system priorities;

83% indicated that chronic pain management protocols have some, minimal or no integration with the health system’s electronic medical records: and

30% believed that they have effective practice protocols in place to promote non-opiate analgesics.

Chronic pain management is fragmented across clinical services, modes of care, e.g., inpatient, outpatient, emergency department, medical homes. This observation corroborates our findings about fragmentation of the market.

These observations coincide with our analysis of the pain management market and support our contention that a standardized, nationally branded service that specializes only in the treatment and management of chronic pain will offer a competitive advantage in the market.

Our Services

The Protocol is a new, proprietary medical approach for the treatment and management of chronic pain which consists of the following personalized treatment plans.

Physical examination by the attending doctor, blood testing and urine drug screening to:

provide accurate diagnoses of the type and source of pain;

establish baseline drug profiles;

monitor treatment progress; and

maintain post-treatment support.

Education for patients about the specific nature of their chronic pain.

On-going interaction to ensure and support patient adherence to beneficial behavioral changes such as keeping regular hours to enhance sleep patterns.

Relaxation training to reduce the effects or stress and anxiety which can aggravate pain.

Specific amino acids and other dietary supplements to restore and maintain normal brain chemistry.

Reduction of cellular inflammation through:

patient pain diary and tracking of food intake and activities;

identification of pain triggers and food sensitivities in the diet; and

proper nutrition to eliminate problem foods and provide better nutrition.

Reduction of joint inflammation through:

dietary changes;

topical medications; and

light exercise regimens.

Day and night time regimens to promote restorative sleep.

Use electrotherapy stimulation (“CES”) to promote production and release of endorphins (Han et al., 1991; Han, 2004).

Topical medications for pain relief.

On-going counseling, telephone and on-line support and regular checkups to:

review progress and maintain flexible, individualized programs;

allow changes in the treatment protocols to achieve optimal results; and

promote continuing patient compliance and contact.

Our results

Two preliminary studies have been conducted using the Protocol.

Study #1

A study was conducted at a pain management clinic in Ohio. Thirty-nine patients were treated with the 2 components of the Protocol that, without CARF accreditation, are funded under 2 separate CPT codes by the Bureau of Workers’ Compensation of Ohio.

The patients received 2 in-clinic treatments of 30 to 45 minutes each for 6 to 12 weeks. The procedures were overseen by a doctor but mostly implemented by other staff or self-administered by unattended patients.

Each patient provided a subjective assessment of the following symptoms before and after the treatment:

Mood from 1 for bad to 10 for good

Energy from 1 for low to 10 for high

Pain from 1 for low to 10 for high

The results are presented in the table below.

Symptom

Mood

Energy

Pain

Pre-treatment average

4.94

3.45

6.47

Standard deviation

2.32

1.90

1.71

Post treatment average

6.54

5.04

4.73

Standard deviation

2.25

2.08

1.81

Confidence level in efficacy

>95%

>99%

Statistic

2SEM

2.58SEM

These results indicate that patients felt that their mood and energy improved and their pain reduced as a result of being treated with an abbreviated version of the Protocol.

Study #2

A study was conducted at the Natural Pain Relief Centre in Toronto, Canada. Eighteen patients were selected at random and treated over a period of 8 weeks. At the beginning of the treatment program, each patient provided a subjective measurement of the following symptoms:

Number of times waking up from sleep

Hours of sleep each night

Maximum pain level during the day from 0 for no pain to 10 for maximum pain

Average pain level during the day from 0 for no pain to 10 for maximum pain

Energy level for the day from 1 for low to 10 for high

Hours per day without pain

The patients also kept a diary of food and drink consumed over the test period.

After 8 weeks of treatment with the Protocol, patients assessed the above symptoms. The table below sets forth the results.


Symptom	Waking up	Hours of sleep	Maximum pain level	Average pain level	Energy level	Hours no pain

Pre-treatment average	3.75	5.61	7.56	6.53	4.78	2.06
Standard deviation	1.48	1.61	2.12	2.07	1.44	2.91

Post treatment average	1.77	6.52	4.63	2.54	6.26	7.95
Standard deviation	0.89	1.01	2.05	1.33	1.34	4.77

Confidence level in efficacy	>99.9%	<95%*	>99.9%	>99.9%	>95%	>99.9%
Statistic	3.39SEM	2SEM	3.39SEM	3.39SEM	2SEM	3.39SEM

*Not significant

These results indicate that with the full treatment proscribed for the Protocol patients were waking up from sleep less, their maximum and average pain levels were reduced and their energy levels and hours without pain increased. There was not a significant effect on the hours of sleep at the 95% confidence level.

Other observations

One of the most notable observations that has come from our above studies and from other patients that have been treated with the Protocol is that many patients are able to reduce their intake of medications to control their pain. Although the level of drug use by patients before, during and after treatment with the Protocol has not been measured in any study, we do intend to conduct formal clinical trials so that we may quantify the effect of treatments with the Protocol on drug use, if any.

We also hypothesize that treatment with the Protocol restores normal brain chemistry by boosting the concentration of endorphins and other pain-reducing chemicals in cerebrospinal fluid (“CSF”). We have no direct evidence for this but it is another aspect of treating pain with the Protocol that we intend to study in formal clinical trials.

We do have indirect support for the hypothesis which provides us with encouragement to undertake such a study. Lipman et al. (1990) observed that chronic pain led to a 50% reduction in the concentration of endorphins in the CSF compared to the control group that was not suffering from chronic pain. These authors further observed that 14 of the 20 patients, as assessed by a verbal rating scale, as used in our studies, reported complete or greater than 50% relief from pain when injected with a saline placebo. In these patients that responded to a placebo, a concomitant 2.3 fold increase in the endorphin levels in their CSF was observed (P<0.05, paired t-test). In the 6 patients who did not respond to the placebo, no difference in the CSF endorphin levels when compared before and after the treatment (P>0.4, paired t-test).

As noted by Almay et al. (1978) patients with somatogenic or organic pain have lower CSF endorphin levels than patients with psychogenic pain that stems from emotional or mental stress. In the study by Lipman et al. (1990), the nature of the pain was not disclosed. Gracheva et al., (2000) observed that there is also a specific relationship between the brain chemicals N-acetyl aspartate, creatine, choline, glutamate, glutamine, g-aminobutyric acid, inositol, glucose and lactate and perceptual measures of pain and anxiety.

Clearly the relationship between brain chemistry and the absence or presence of chronic pain, the type of chronic pain and chronic pain treatments is very complex. We therefore consider it very important to study the effect on brain chemistry, if any, in patients with chronic pain who are treated with the Protocol.

Our proposed clinic acquisitions

We are pursuing the acquisition of clinics that specialize in pain management that are seeking improved care for their patients and wish to augment their standard pain management treatments. Our initial strategy is to acquire such clinics but we will also consider licensing the Protocol, as permitted by our agreement with Champion Toronto, or entering into joint venture agreements with these clinics or clinics in the public sector. Once we have successfully established the Protocol at a clinic, we expect that the physicians will be able to treat their patients by assessing their specific needs and directing other personnel, such as counselors, massage therapists, nurse practitioners and dieticians, to provide the individualized, comprehensive care that is the hallmark of the Protocol. We also expect to establish pharmacies at some of our acquired clinics, subject to applicable rules and regulations, so patients may purchase medications prescribed by their physician under the Protocol.

Our definitive acquisition agreement will provide for:

Employment agreements for physicians and key employees who are retained.

Non-disclosure, non-competition and non-solicitation agreements.

Distribution or payment of accounts receivable and accounts payable, respectively.

Consulting agreements for physicians and other key personnel who are choosing to retire or otherwise leave the clinic to extend during a negotiated transition phase.

The success of any clinics that we may acquire will depend on the effectiveness of other health-care professionals who will be working under the direction of our physicians including counselors, massage therapists, nurse practitioners and dieticians. The recruitment of suitable personnel is integral to our business as the health-care team at any acquired clinic will need to be trained to implement the Protocol and assist with securing CARF accreditation for that clinic. CARF International (“CARF”) is an organization that provides accreditation for Medical Rehabilitation, including pain management therapies. CARF accreditation provides evidence to patients and funding agencies that a standardized service will be provided in all clinics that adopt the Protocol.

We are currently conducting due diligence on a number of clinics in the United States that are run by sole practitioners. In this regard, we have identified certain opportunities that we believe will yield substantial revenues after an acquisition. In certain cases, a physician’s time may be divided between two clinics, each of which are only operating on a part-time basis. We believe that revenues can be increased by hiring an additional physician and running both clinics full-time. In most cases, doctors have preferred funding sources and tend to downplay or ignore others. Our strategy is to increase revenues by pursuing unexploited sources of revenues, developing ancillary services and securing CARF accreditation.

Sales and Marketing

We plan to attend as exhibitors and make presentations at conferences such as the annual meetings of The American Society of Regional Anesthesia and Pain Medicine, The American Academy of Pain Medicine and The American Pain Society. We will also develop printed materials for distribution to funding agencies such as bureaus of workers’ compensation, insurance companies, managed care companies and government agencies. In addition, we plan to establish a strong presence online and to implement social network marketing strategies. Our goal is to establish our company as a national brand across the United States, so that our patients can expect and receive consistent service and treatment at any facility that we own. We intend to further develop our sales and marketing strategies for the Protocol by engaging outside marketing consultants once sufficient financing is available to do so.

Customers

We expect that the individual patients and third parties payors for the clinics we acquire will continue to utilize the services of the acquired clinic. The clinics we are now evaluating or attempting to acquire have existing revenues from individuals who pay for their own treatments but, based upon our due diligence, the substantial portion of the clinic’s revenue derives from third party payors, such as state Bureaus of Worker’s Compensation (“BWCs”), national health insurance companies such as Anthem Blue Cross, Summacare and United Healthcare, regional insurance companies such as Medical Mutual of Ohio, managed health care companies such as Kaiser Permanente and Humana, and federal government programs such as Medicare, Medicaid and Tricare. In addition to this base of customers, we plan to pursue additional contracts and relationships with institutions, both in the private and public sectors that have an interest in securing relief for their clients and patients from chronic pain, such as the Department of Veterans Affairs and elder care facilities that offer nursing homes and assisted living facilities. We will also evaluate the mix of payors that each clinic has because we have noticed that each clinic has its own preferred payors and may be ignoring or avoiding other payors depending on the personal preferences or prejudices of the owners of the clinics. Clearly, we believe, there is an opportunity to increase revenues in each clinic by adding payors that are not being currently served.

Competition

In August 2012, we identified 285 cities in the U.S. with populations greater than 100,000 and found that 2,022 doctors were practicing in 1,339 private clinics that specialized in pain management and were registered for that specialty with at least one national health insurance provider. We also found that most clinics were registered with more than one insurance company.

Further examination revealed that approximately 14% of those clinics were operated by sole practitioners, nearly 72% averaged between one and two doctors, approximately 5% had between two or three doctors on staff and less than 9% had three or more doctors. This suggests that the practice of pain management is highly fragmented and that there is little, if any, consolidation of practices in the pain management field. Based on these numbers, we believe that our competition consists of highly independent, small clinics and that our strategy of acquiring clinics, implementing the Protocol, securing CARF accreditation and standardizing our service as a national brand will provide us with a competitive advantage over individualized clinics that have a sole practitioner or a only a few partners.

While our estimates of the numbers of clinics and doctors did not include large medical institutions such as private and public hospitals or research institutions such as hospitals run by the managed health care companies, e.g., Humana, Summacare and public institutions such as Johns Hopkins Hospital. We understand that we will also be competing with these hospitals and institutions for patients and funding and recognize that they have a high level of credibility and a national presence. However, we believe that many patients prefer a local provider and individualized service for their health care needs. The clinics that we are seeking to acquire are, or are capable of, generating attractive revenues and profits by operating under these principals. By bringing consistent management, standardized service, a national brand and accounting and administrative efficiencies to the clinics we acquire, we hope to establish a competitive advantage and co-exist with these large providers of similar services.

Intellectual property

We license the Protocol from Champion Toronto exclusively for delivery in United States in exchange for a royalty payment of 10% of net sales. The term of our license extends through February 1, 2018, with automatic 5 year renewals until the license agreement is terminated by either party. All of our directors are also directors of Champion Toronto, and as such, we expect our relationship with Champion Toronto to be long lasting.

The Protocol is a trade secret and Champion Toronto has no patent or copyright protection in place. Without formal intellectual property (“IP”) protection, the Protocol is vulnerable to theft or being copied. Although trade secret protection is often chosen as a means to protect IP, it leaves a company with few options to take action if a third party manages to reverse engineer or copy the trade secret. To protect our interests, we do not provide any information on the Protocol to third parties without a Non-Disclosure Agreement (“NDA”) in place. We intend to strengthen our IP protection options with copyright protection. We also intend to evaluate patenting certain key procedures or apparatus to the Protocol.

Research and Development

We have not conducted any formal clinical trials using standardized methodology to directly compare the effectiveness of the Protocol against current medical approaches for pain relief or to measure the hypothesized restoration of endorphin concentrations in the CSF. Our evidence on the effectiveness of the Protocol is empirical only and consists of case studies that have used subjective evaluations of pain relief by patients who have been subject to the Protocol. As such, we have not expended any amounts on research and development to date. However, it is our intention to initiate formal clinical trials of the Protocol once we have secured sufficient funding to do so.

References

Anon. 2011a. Pain-Management Market Projected to Grow to $60 Billion. PMP News Magazine.
UBM Canon, Santa Monica, CA, USA. 1 p.

http://www.pmpnews.c om/news/pa in-management-market-projected-grow-60-billion

Anon. 2011b. Relieving Pain in America: A Blueprint for Transforming Prevention, Care, Education, and Research. Institute of Medicine. Washington, D.C., USA. 4 pp.

http://www.iom.edu/Re ports/2011/Relieving-Pain-in-America-A-Blueprint-for-Transforming-Prevention-Care-Education-Research/Report-Brief.aspx

Anon. 2011c. The Use of Medicines in the United States: Review of 2010. IMS Institute for Healthcare Informatics. Parsippany, NJ, USA. 37 pp.

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Anon. 2011d. FDA Acts to Reduce Harm from Opioid Drugs. U.S. Food and Drug Administration, Silver Spring, MD, USA. 2 pp.

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Anon. 2011e. Policy Impact: Prescription Painkiller Overdoses. Centers for Disease Control and Prevention. Atlanta, GA., USA. 8 pp.

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Governmental Regulation

General

The following information is presented with the understanding that we have not yet acquired any clinics and are not yet subject to the regulations described below. However, as soon as we have acquired at least one clinic, most, if not all, of the federal regulations and the applicable state and municipal laws described below will apply to our business. For this discussion, it is understood that when we mention “our clinics” or “our facilities” or clinics or facilities that that we “own”, it is in reference to clinics or facilities that we may acquire in the course of our business, assuming that we are able to acquire any clinics at all.

The United States healthcare industry is subject to extensive regulation by a number of governmental entities at the federal, state and local level. Government regulation will affect our business activities by controlling our growth, requiring licensure and certification of the facilities we manage and controlling reimbursement to us for the services we provide.

Medicare-Medicaid Fraud and Abuse Provisions

Section 1128B(b) of the Social Security Act (the “Federal Anti-Kickback Statute”) prohibits the knowing or willful offering, payment, solicitation or receipt or remuneration, directly or indirectly, overtly or covertly, in cash or in kind, for: (1) the referral of patients or arranging for the referral of patients to receive services for which payment may be made in whole or in part under a federal or state healthcare program; or (2) the purchase, lease, order or arranging for the purchase, lease or order of any good, facility, service or item for which payment may be made under a federal or state healthcare program. The Federal Anti-Kickback Statute is very broad in scope and many of its provisions have not been uniformly or definitively interpreted by case law or regulations. Violations may result in criminal penalties or fines of up to $25,000, imprisonment for up to five years, or both. Violations of the Federal Anti-Kickback Statute may also result in substantial civil penalties, including penalties of up to $50,000 for each violation, plus three times the amount claimed and exclusion from participation in the Medicare and Medicaid programs. Exclusion from these programs would result in significant reductions in revenue and would have a material adverse effect on our business. As authorized by Congress, the Office of the Inspector General (“OIG”) promulgated safe harbor regulations that outline categories of activities protected from prosecution under the Federal Anti-Kickback Statute. These safe harbors cover, among other things, investment interests, personal services and management contracts and employment arrangements. Although conduct or business arrangements that do not fall within a safe harbor are not unlawful per se, noncompliant conduct or business arrangements risk increased scrutiny by governmental enforcement authorities. In addition to the Federal Anti-Kickback Statute, the Health Insurance Portability and Accountability Act of 1996, or “HIPAA,” provides for criminal penalties for healthcare fraud offenses that apply to all health benefit programs, including the payment of inducements to Medicare and Medicaid beneficiaries in order to influence those beneficiaries to order or receive services from a particular provider or practitioner. Federal enforcement officials have numerous enforcement mechanisms to combat fraud and abuse, including the Medicare Integrity Program and an incentive program under which individuals can receive up to $1,000 for providing information on Medicare fraud and abuse that leads to the recovery of at least $100 of Medicare funds. In addition, federal enforcement officials have the ability to exclude from Medicare and Medicaid any investors, officers and managing employees associated with business entities that have committed healthcare fraud. Evolving interpretations of current, or the adoption of new, federal or state laws or regulations, could affect many of our arrangements. Law enforcement authorities, including the OIG, the courts and Congress, are increasing their scrutiny of arrangements between healthcare providers and potential referral sources to ensure that the arrangements are not designed as a mechanism to exchange remuneration for patient care referrals and opportunities. Investigators also have demonstrated a willingness to look behind the formalities of a business transaction to determine the underlying purposes of payments between healthcare providers and potential referral sources.

The Federal False Claims Act and Similar Federal and State Laws

The False Claims Act (the “FCA”) prohibits any person from knowingly presenting or causing to be presented a false or fraudulent claim, record or statement to obtain payment from the government or decrease any payments owed to the government. Governmental enforcement agencies or courts may impose fines up to three times the actual damages sustained by the government, plus mandatory civil penalties of between $5,500 and $11,000 for each separate false claim.

Criminal false claims provisions apply to (1) false claims or statements made knowingly or willfully to obtain benefits under Medicare or Medicaid or feign compliance with certification requirements, or (2) failure to refund, knowingly and with fraudulent intent, Medicare and Medicaid funds not properly paid. Governmental enforcement agencies or courts may impose up to five years in prison, $25,000 in fines for each offense, or both.

FCA claims may be brought by governmental enforcement authorities or by individuals on the government’s behalf under the FCA’s qui tam, or “whistleblower,” provisions. Whistleblower provisions allow private individuals to bring actions on behalf of the government alleging that the defendant defrauded the federal government. Additionally, HIPAA established (1) civil liability for up-coding and billing medically unnecessary items and services, and (2) federal criminal sanctions for healthcare fraud against a private, nongovernmental healthcare benefit program. Although we have implemented policies and procedures to avoid violations of these laws, there can be no assurance that the conduct will not be reviewed and challenged by whistleblowers or governmental enforcement authorities. Any adverse determination could subject us to criminal and civil liability.

A number of states have adopted their own false claims provisions as well as their own qui tam provisions whereby a private party may file a civil lawsuit in state court.

Healthcare Industry Investigations

Both federal and state government agencies have heightened and coordinated civil and criminal enforcement efforts as part of numerous ongoing investigations of healthcare companies, as well as their executives and managers. These investigations relate to a wide variety of topics, including referral and billing practices.

From time to time, the OIG and the United States Department of Justice (the “DOJ”) have established national enforcement initiatives that focus on specific billing practices or other suspected areas of abuse. Some of our activities could become the subject of governmental investigations or inquiries. In addition, our executives and managers, many of whom have worked at other healthcare companies that are or may become the subject of federal and state investigations and private litigation could be included in governmental investigations or named as defendants in private litigation. We are not aware of any governmental investigations involving any of our facilities, our executives or our managers. A future adverse investigation of us, our executives or our managers could result in significant expense to us, as well as adverse publicity.

Privacy Requirements and Administrative Simplification

Federal and state governmental enforcement authorities extensively regulate the confidentiality of patient health information. HIPAA privacy regulations regulate the use and disclosure of patient health information, whether communicated electronically, on paper or orally. The regulations also provide patients with significant rights related to understanding and controlling how their health information is used or disclosed. HIPAA security regulations require healthcare providers to implement administrative, physical and technical safeguards to protect the security of patient health information that is maintained or transmitted electronically. Further, as required by HIPAA, Department of Health and Safety has adopted regulations establishing electronic data transmission standards that all healthcare providers must use when submitting or receiving certain healthcare transactions electronically.

The penalty for failure to comply with HIPAA privacy and security standards is a fine of up to $100 for each violation, with a maximum penalty of $25,000 imposed for all violations of an identical requirement during a calendar year. Additionally, any person or entity who violates HIPAA privacy or security regulations may be fined up to $250,000, imprisoned for not more than 10 years or both. We believe we will comply in all material respects with all applicable federal and state laws, rules and regulations governing the privacy and security of patient health information. Because of the complexity of these regulations, however, there can be no assurance that our privacy and security practices will not be reviewed and found not to be in compliance with these standards. An adverse determination by governmental enforcement authorities could materially and adversely affect our business.

In addition, our clients will continue to remain subject to any state laws that are more restrictive than the HIPAA privacy and security regulations. These statutes vary by state and could impose additional penalties.

Patient Protection and Affordable Care Act

On March 23, 2010, President Obama signed into law the Patient Protection and Affordable Care Act (the “ACA”). The Healthcare and Education Reconciliation Act of 2010 (the “Reconciliation Act”), which contains a number of amendments to the ACA, was signed into law on March 30, 2010. Two primary goals of the ACA, combined with the Reconciliation Act (collectively referred to as the “Health Reform Legislation”), are to provide for increased access to coverage for healthcare and to reduce healthcare-related expenses.

On June 28, 2012, the United States Supreme Court upheld the constitutionality of the requirement in PCA that individuals maintain health insurance or pay a penalty under Congress’s taxing power. The Supreme Court upheld the ACA provision expanding Medicaid eligibility to new populations as constitutional, but only so long as the expansion of the Medicaid program is optional for the states. States that choose not to expand their Medicaid programs to newly eligible populations in ACA can only lose the new federal Medicaid funding in ACA but not their eligibility for existing federal Medicaid matching payments.

The Health Reform Legislation expands coverage of uninsured individuals and provides for significant reductions in the growth of Medicare program payments, material decreases in Medicare and Medicaid disproportionate share hospital payments, and the establishment of programs where reimbursement is tied in part to patient outcomes. Based on Congressional Budget Office estimates, the Health Reform Legislation, as enacted, is expected to expand health insurance coverage to approximately 32 to 34 million additional individuals through a combination of public program expansion and private sector health insurance reforms.

Some of the most significant changes will expand the categories of individuals eligible for Medicaid coverage and permit individuals with relatively higher incomes to qualify. The federal government reimburses the majority of a state’s Medicaid expenses, and it conditions its payment on the state meeting certain requirements. The federal government currently requires that states provide coverage for only limited categories of low-income adults under 65 years old (e.g., women who are pregnant, and the blind or disabled). In addition, the income level required for individuals and families to qualify for Medicaid varies widely from state to state. While the Health Reform Legislation will greatly expand the number of adults who are eligible for Medicaid, it may not impact our business as Medicaid generally does not reimburse for care provided to adults treated in freestanding behavioral health facilities. As the direct impact of the Health Reform Legislation will be felt by our customers, we are unable to predict with any reasonable certainty the likely impact of the Health Reform Legislation on our business model, financial condition or result of operations due to the law’s complexity, lack of implementing regulations or interpretive guidance, gradual and partially delayed implementation, court challenges and possible amendment, repeal or further implementation delays, as well as our inability to foresee how individuals, states and businesses will respond to the choices afforded them by the law.

The laws of many states prohibit physicians from splitting fees with non-physicians (i.e., sharing in a percentage of professional fees), prohibit non-physician entities, such as ourselves, from practicing medicine and exercising control over or employing physicians and prohibit referrals to facilities in which physicians have a financial interest. We believe our planned activities will not violate these state laws as we do not intend to acquire clinics in any such states. We believe that outpatient treatments and diagnostic services will continue to be subject to intense regulation at the federal and state levels. We are unable to predict what additional government regulations, if any, affecting our business may be enacted in the future or how existing or future laws and regulations might be interpreted. Future interpretations of, or changes in, these laws might require structural and organizational modifications of our relationships with facilities and the physician network, and we cannot assure you that we will be able to appropriately modify such relationships.

In addition, every state imposes licensing requirements on individual physicians and healthcare facilities. Many states require regulatory approval, including licenses and, in some cases, certificates of need, before establishing certain types of healthcare facilities, including the facilities we plan to acquire. States may also require approval for certain expenditures in excess of certain amounts for healthcare equipment, facilities or programs. Our ability to operate profitably will depend in part upon all of our acquired clinics obtaining and maintaining all necessary licenses, certificates of need and other approvals and operating in compliance with applicable healthcare regulations. If we, or any of our facilities, fail to comply with applicable laws, it might have a material adverse effect on our business.

Clinics we acquire will be also subject to federal, state and local laws dealing with issues such as occupational safety, employment, medical leave, insurance regulations, civil rights, discrimination, building codes and medical waste and other environmental issues. The imposition of these regulatory requirements may have the effect of increasing operating costs and reducing the profitability of our operations.

Survey and Accreditation

Health care facilities are subject to periodic inspection by federal, state and local authorities to determine their compliance with applicable regulations and requirements necessary for licensing, certification and accreditation. We expect that any clinics we acquire will comply with appropriate state laws but we cannot provide any assurance that any particular clinic will be qualified to participate in the Medicare and Medicaid programs. We intend to seek CARF International (“CARF”) accreditation for selected, if not all, of the clinics that we acquire. CARF is an organization that provides voluntary accreditation for Medical Rehabilitation, including pain management treatments. CARF accreditation provides independent validation that a standardized service for pain treatment and management will be provided in all clinics we acquire. There is no guarantee that we will be able to achieve or retain CARF accreditation for any clinic. If any clinic fails to acquire or retain CARF accreditation, the lack of accreditation will have an adverse effect on that clinic and on our Company.

Regulatory Compliance Program

It is our policy to conduct our business with integrity and in compliance with the law. However, at this time we do not have in place a program that focuses on all areas of regulatory compliance including billing, reimbursement, cost reporting practices and contractual arrangements with referral sources. It may be some time before such a program can be established but, when the resources are available to do so, we will endeavor to establish a regulatory compliance program that will help ensure that high standards of conduct are maintained in the operation of our business and that policies and procedures are implemented so that employees act in full compliance with all applicable laws, regulations and company policies. Under a typical regulatory compliance program, every employee and certain contractors involved in patient care, and coding and billing, receive initial and periodic legal compliance and ethics training. In addition, we expect that we will need to regularly monitor our ongoing compliance efforts and develop and implement policies and procedures designed to foster compliance with the law. The program will also need a mechanism for employees to report, without fear of retaliation, any suspected legal or ethical violations to their supervisors, designated compliance officers in our facilities, a compliance hotline or directly to a corporate compliance office, when such an office is established. We will endeavor to ensure that any compliance program that we may establish is consistent with standard industry practices. However, we cannot provide any assurances that any compliance program that may be set up will detect all violations of law or protect against qui tam suits or government enforcement actions.

Employees

At the time of this report, we have no employees.

ITEM 1A. RISK FACTORS

The following risk factors and other information included in this Annual Report on Form 10-K should be carefully considered. The risks and uncertainties described below are not the only ones we face. Additional risks and uncertainties not presently known to us or that we currently believe to be immaterial may also adversely affect our business We refer you to our the cautionary statements regarding forward-looking statements set forth in Management’s Discussion and Analysis of Financial Condition and Results of Operations which identifies certain forward-looking statements contained in this report that are qualified by these risk factors. If any of the following risks occur, our business, financial condition, results of operations and future growth prospects could be materially and adversely affected.

Although we have not yet acquired any clinics or licensed the Protocol, the following risk factors are expected to affect our business and the industry in which we will operate. Accordingly, when we refer to “our clinics” below, it is with reference to clinics that we intend to acquire, regardless of the level of ownership or clinics that are involved in joint ventures with us. The risks and uncertainties described below are not the only ones facing our Company. Additional risks and uncertainties not presently known to us or that we currently consider immaterial may also have an adverse effect on us. If any of the matters discussed in the following risk factors were to occur, our business, financial condition, results of operations, cash flows or prospects could be materially adversely affected.

Risks related to our business

We have not yet commenced substantive operations or earned revenue, and as such, our financial statements may not serve as an adequate basis to judge our future prospects and results of operations.

To date, we have been involved primarily in pursuing acquisition of pain care clinics and have not earned any revenues. As such, our financial statements may not provide a meaningful basis on which to evaluate our business. Moreover, we cannot assure you we will be able to implement our business plan and growth strategy successfully. We will continue to encounter risks and difficulties frequently experienced by companies at an early stage of development, which include a potential failure in:

implementing the Protocol to pain management clinics in the United States;

obtaining sufficient capital to acquire clinics in accordance with our business plan;

maintaining adequate control of our expenses;

maintaining the proprietary nature of the Protocol;

implementing our marketing and acquisition strategies and adopting and modifying them as needed;

anticipating and adapting to changing conditions in the health care and pain management industries; and

anticipating and adapting to any changes in government regulation.

Our inability to manage successfully any or all of these risks may materially and adversely affect our business, financial condition and results of operations.

We are a presently a holding company that will, unless we make acquisitions at the parent level, depend on cash flow from our wholly owned subsidiaries to meet our obligations, and any inability of our subsidiaries to pay us dividends or make other payments to us when needed could disrupt or have a negative impact on our business.

We are presently a holding company with no material assets other than our ownership interests in our wholly-owned subsidiaries, CPCC and IAG, for which we have no present plans. We expect to rely on dividends, advances, or other such distributions, from our clinics for our cash needs to service any debt we may incur and to pay our operating expenses. Distributions to us will depend upon the profitability of the clinics we acquire, which will be subject to a number of business considerations, state and federal laws and the agreements between us and the acquired clinic. We cannot provide any assurance that any distribution of funds to us will be adequate to satisfy our liquidity needs, and if we are not able to obtain sufficient funds to pay our obligations as they become due, our business could be negatively impacted.

We may not be able to implement our business strategy successfully on a timely basis or at all.

Our future success depends, in large part, on our ability to implement our business strategy of acquiring clinics for delivery of the Protocol. Our ability to implement this growth strategy depends, among other things, on our ability to:

Obtain financing to enable us to buy clinics,

enter into acquisition agreements with clinics we have outstanding MOUs with as well as other clinics that we deem accretive to our business interests;

increase the recognition of the Protocol; and

expand and maintain delivery of the Protocol in the United States.

In the event we are unable to successfully implement our business strategy or if we invest resources in a strategy that ultimately proves unsuccessful, our operating results will be adversely affected.

Our business is substantially dependent on the efficacy of the physicians who work in our acquired clinics; any loss or reduction in the quality of the physician’s services will negatively impact our results of operations.

Our business depends on, among other things, the physicians who will work in our acquired clinics and the strength of our relationship with those physicians. If a physician leaves our clinic either upon or subsequent to our acquisition, or does not provide quality medical care or follow required professional guidelines at our clinic, or if the physician’s reputation is damaged during his tenure at our clinic, we may need to recruit a replacement physician. In such a case, the revenues generated in an acquired clinic will be negatively impacted during the time it takes us to recruit a replacement physician.

If we fail to acquire and develop clinics on favorable terms, our future growth and operating results could be adversely affected.

We plan to generate revenues and earnings by acquiring existing pain management clinics two of which are subject to outstanding MOUs and augmenting their established treatment protocols with the Protocol, our own proprietary system for treating and managing chronic pain. The success of our business plan will be affected by our ability to continue to identify suitable clinics for acquisition and our ability to negotiate and close on clinic acquisitions in a timely manner and on favorable terms. There can be no assurances that we will be successful in identifying additional clinics suitable for acquisition or that we will be able to close on clinic acquisitions in a timely manner and/or on terms favorable to us.

If we are unable to implement our growth strategy at our acquired clinics, our operating margins and profitability could be adversely affected.

We plan to increase revenues and earnings from the clinics we acquire by increasing the type and number of procedures performed and increasing the number of physicians performing procedures, consistent with the Protocol. In addition, we plan to obtain new or more favorable contracts with third party payors, increase the capacity of our clinics and increase patient and physician awareness of our clinics. Through this strategy we expect to increase the volume of procedures performed at our acquired clinics and result in higher revenues. However, procedure volume at our acquired clinics is susceptible to economic conditions, such as high unemployment rates, higher co-pays and other factors that may cause patients to delay or cancel previously planned procedures. As such, there can be no assurances that we will be successful at implementing our growth strategy at our acquired clinics.

If we are unable to manage the growth of our business through the acquisition of clinics our business and results of operations could be adversely affected.

If we close on the acquisition of the clinics we are pursuing we nevertheless may not be able to successfully integrate their operations with our then existing clinics and we may not realize all or any of the expected benefits of acquiring new clinics as and when planned. The integration of operations of new clinics with existing clinics will be complex, costly and time-consuming. We expect that the integration of the operations of new clinics will require significant attention from our senior management and will impose substantial demands on our operations and personnel, potentially diverting attention from other important pending projects. Therefore, we may not be able to successfully manage our growth within our budgetary expectations and anticipated timetable. Accordingly, we may fail to realize some or all of the anticipated benefits of acquiring new clinics, including increasing the scale of our operations, diversification, and cash flows and operational efficiency.

If we do not have sufficient capital resources to complete acquisitions and develop our clinics, our ability to implement our business plan could be adversely affected.

We will need capital to implement our business plan, and will seek to finance future clinic acquisitions and development projects through debt or equity financings of which there can be no assurance. Disruptions to financial markets or other adverse economic conditions may adversely impact our ability to complete any such financing or the terms of any such financing may be unacceptable or unfavorable to us. To the extent that we undertake financings with our equity securities, our current shareholders will experience ownership dilution. To the extent we incur debt, we may have significant interest expense and may be subject to covenants in the related debt agreements that restrict the conduct of our business. No assurance can be given that we will be able to obtain financing necessary to further implement and develop our business plan or that the financing will be available on terms acceptable to us.

Since most medical clinics operate on a cash rather than an accrual basis, we may not be able to accurately determine the profitability or current assets of clinics that are acquisition prospects and possibly overpay for them which will adversely affect our profitability, diminish our tangible assets and increase our accounting costs.

We have observed that most of the financial statements of clinics that we have reviewed are prepared on a cash basis rather than on an accrual basis and that no information is available on the value or aging of Accounts Receivable or Accounts Payable. As a result, this information must be obtained through audits which will increase our accounting costs and, if the records are incomplete, may lead to incorrect estimates, overpayment for certain clinics and diminished asset value. In addition, all clinics operating on a cash basis will have to be converted to accrual accounting which will also lead to additional costs that could have an adverse effect on our profitability.

Implementation of the Protocol may not meet our expectations, and any such failure would adversely affect our ability to implement our business plan.

We anticipate that a material portion of our revenues will be derived from the introduction of the Protocol into our acquired clinics and possibly through licensing the Protocol to other entities, such as hospitals. We can give no assurance that the Protocol will be widely accepted or that we will be able to receive enough, or any, funding from payors to introduce or sustain the Protocol in any given clinic, or at all. Because the Protocol is a new medical approach, it is possible that wide acceptance will never be attained which would have an adverse effect on our business, financial condition and results of operations.

If we are unable to secure CARF accreditation for our acquired clinics, our revenues, credibility and market acceptance may be adversely affected.

CARF is an organization that provides accreditation for medical rehabilitation, including pain management therapies. While CARF accreditation is voluntary, and the process for accreditation is rigorous and costly, we intend to secure accreditation for the clinics we acquire to demonstrate that a standardized service is available in all clinics that use the Protocol. If we fail to achieve accreditation for some or any of our clinics, our reputation may be adversely affected and we may have difficulty attracting a suitable number of patients or third party payors to generate additional revenues at our acquired clinics.

No clinical trials of the Protocol have been undertaken and, if such trials are completed, there is no assurance that the Protocol will demonstrate any comparative advantage to standard medical approaches.

The evidence for the effectiveness of the Protocol is derived from two preliminary studies and patient testimonials that have relied on subjective evaluations of pain relief by patients. Although we wish to undertake formal clinical trials and test the Protocol against standard medical approaches for pain relief using standardized methodology, there is no assurance that such clinical trials will ever take place due to the expense of conducting such trials. While we perceive advantages to the Protocol based upon our studies, clinical trials, if conducted, may not show any measurable advantage of the Protocol over standard medical approaches to pain care which could affect the marketability of the Protocol, and thus negatively impact on our ability to implement our business plan.

A lack of formal intellectual property protection for the Protocol may result in unauthorized use by physicians or clinics.

The Protocol is a trade secret and, without formal intellectual property (“IP”) protection, is vulnerable to unauthorized use. Although trade secret protection is often chosen as a means to protect IP, it leaves a company with few options to take action if a third party manages to reverse engineer or copy the trade secret. To protect our interests, we do not provide any information on the Protocol to third parties without a Non-Disclosure Agreement (“NDA”) in place. In the future, we intend to strengthen our IP protection options in due course with copyright protection. We also intend to evaluate patenting certain key procedures or apparatus related to the Protocol. However, we may not be able to support the expense of taking such steps and, even after we have taken all reasonable steps to protect our IP, it is still possible that unauthorized third parties will use our IP. If such unauthorized use of our IP does occur, our ability to stop such practices may be very limited and, if so, we will likely lose some potential revenues.

In order to treat patients, the Protocol requires extensive orientation and training of personnel, which may be beyond our capabilities, or unavailable.

The Protocol involves a number of different procedures, types of personnel, products, apparatus, supplements and medications. At this time, we only have our executive officers available to provide the training needed for a clinic to adopt the Protocol. To mitigate this problem, we may seek to establish a training center at a centrally-located clinic that has the resources to accommodate mandatory training courses. Also, we may run mandatory training programs in different centers across the United States to accommodate the needs of new clinics. However, the personnel needed to treat patients using the Protocol may not be available at a particular clinic. We believe we may need to engage the services of independent health care professionals to provide selected services in our acquired clinics until we are in a position to hire our own professionals. However, personnel needed to deliver the Protocol to patients may not be available in the area of our acquired clinics, which may lead to high travel and accommodation costs to have the necessary personnel available, which, in turn, could adversely affect our profitability.

If we are restricted from establishing pharmacies associated with our clinics, there will be an adverse effect on our revenues and profits.

We expect a significant portion of our revenues to come from pharmacies associated with our clinics. Although one of the clinics with which we are negotiating acquisition terms does include an associated pharmacy, we can provide no assurance that the federal, state or municipal regulations will allow a pharmacy to be established at any particular clinic we acquire in the future. If we are unable to open pharmacies at our clinics, our revenue and profit potential will be adversely affected.

Regulators at the federal and state level are monitoring and restricting the prescribing and use of pain medications which could have an adverse effect on our growth.

State and federal regulators are enforcing new restrictions to reduce the amount of abuse of strong and addictive pain medications, such as opiates. In some states, such as Florida, a moratorium on new licenses for pain management clinics has been put in place in an attempt to stop the illegal distribution of such medications. Such restrictions on the licensing of new clinics could have a material effect on our business because a significant component of our planned growth is expected to come from expanding our clinics into new locations within a geographical area.

Risks specific to our industry

The healthcare regulatory and political framework is uncertain and evolving.

Healthcare laws and regulations may change significantly in the future which could adversely affect our financial condition and results of operations. We will continually monitor these developments and modify our operations from time to time as the legislative and regulatory environment changes. In March 2010, President Barack Obama signed one of the most significant health care reform measures in decades providing healthcare insurance for approximately 30 million more Americans. The Patient Protection and Affordable Care Act, as amended by the Health Care and Education Affordability Reconciliation Act (collectively, the “ACA”), substantially changes the way health care is financed by both governmental and private insurers, including several payment reforms that establish payments to hospitals and physicians based in part on quality measures, and may significantly impact our industry. We are unable to predict what effect the ACA or other healthcare reform measures that may be adopted in the future will have on our business.

The healthcare industry is highly regulated, and government authorities may determine that we have failed to comply with applicable laws or regulations.

The healthcare industry and physicians’ medical practices, including the healthcare and other services that we and our affiliated physicians intend to provide, are subject to extensive and complex federal, state and local laws and regulations, compliance with which will impose substantial costs on us. Of particular importance are the provisions summarized as follows:

federal laws (including the federal False Claims Act) that prohibit entities and individuals from knowingly or recklessly making claims to Medicare and other government programs that contain false or fraudulent information or from improperly retaining known overpayments;

a provision of the Social Security Act, commonly referred to as the “anti-kickback” law, that prohibits the knowing and willful offer, payment, solicitation or receipt of any bribe, kickback, rebate or other remuneration, in cash or in kind, in return for the referral or recommendation of patients for items and services covered, in whole or in part, by federal healthcare programs, such as Medicare;

a provision of the Social Security Act, commonly referred to as the Stark Law, that, subject to limited exceptions, prohibits physicians from referring Medicare patients to an entity for the provision of certain “designated health services” if the physician or a member of such physician’s immediate family has a direct or indirect financial relationship (including a compensation arrangement) with the entity;

similar state law provisions pertaining to anti-kickback, fee splitting, self-referral and false claims issues, which typically are not limited to relationships involving federal payors;

provisions of HIPAA that prohibit knowingly and willfully executing a scheme or artifice to defraud a healthcare benefit program or falsifying, concealing or covering up a material fact or making any material false, fictitious or fraudulent statement in connection with the delivery of or payment for healthcare benefits, items or services;

state laws that prohibit general business corporations from practicing medicine, controlling physicians’ medical decisions or engaging in certain practices, such as splitting fees with physicians;

It is possible that future legislation and regulation, aside from the ACA, and the interpretation of existing and future laws and regulations could have a material adverse effect on our ability to operate under Medicare and Medicaid and to continue to serve and attract new providers and patients. In addition, we believe that our business will continue to be subject to increasing regulation, the scope and effect of which we cannot predict.

We may in the future become the subject of regulatory or other investigations or proceedings, and our interpretations of applicable laws, rules and regulations may be challenged.

Regulatory authorities or other parties may assert that our arrangements with our affiliated professional contractors constitute fee splitting or the corporate practice of medicine and seek to invalidate these arrangements, which could have a material adverse effect on our business, financial condition, results of operations, cash flows and the trading price of our common stock. Regulatory authorities or other parties also could assert that our relationships, including fee arrangements, among our affiliated professional contractors, hospital clients or referring physicians violate the anti-kickback, fee splitting or self-referral laws and regulations or that we have submitted false claims or otherwise failed to comply with government program reimbursement requirements. Such investigations, proceedings and challenges could result in substantial defense costs to us and a diversion of management’s time and attention. In addition, violations of these laws are punishable by monetary fines, civil and criminal penalties, exclusion from participation in government-sponsored healthcare programs, and forfeiture of amounts collected in violation of such laws and regulations, any of which could have a material adverse effect on our business, financial condition, results of operations, cash flows and the trading price of our common stock.

Our records and submissions to funding agencies may contain inaccurate or unsupportable coding which could cause us to overstate or understate our revenue and subject us to various penalties.

A major component of the regulatory environment is the interpretation of billing procedures established by the American Medical Association and provided in the Current Procedural Terminology (“CPT”) code set. The CPT code set describes medical, surgical, and diagnostic services and is designed to communicate uniform information about medical services and procedures among physicians, coders, patients, accreditation organizations, and payors for administrative, financial, and analytical purposes. CPT coding is similar to the International Statistical Classification of Diseases and Related Health Problems (“ICD”), a medical classification list by the World Health Organization except that CPT identifies the services rendered rather than the diagnosis on the claim. The 9^th revision of the ICD (“ICD-9”) describes approximately 14,000 procedures, while the 10^th revision (“ICD-10”), when implemented, will describe about 70,000 procedures. Inaccurate or unsupportable coding, inaccurate records for patients and erroneous claims could result in inaccurate fee revenue being reported. Such errors are subject to correction or retroactive adjustment in later periods and may be reflected in financial statements for periods subsequent to the period in which the revenue was recorded. We may also find that we are required to refund a portion of the revenue that we received, which, depending on its magnitude, could damage our relationship with the subject funding agency and have a material adverse effect on our results of operations or cash flows.

The Centers for Medicare and Medicaid Services (“CMS”) has expanded the pilot recovery audit contractor (“RAC”) program to a permanent nationwide program. RACs are private contractors contracting with CMS to identify overpayments and underpayments for services through post-payment reviews of claims submitted by Medicare and Medicaid providers. The Healthcare Reform Acts expands the RAC program's scope to include managed Medicare and to include Medicaid claims by requiring all states to establish programs to contract with RACs. All states were required to implement Medicaid RAC programs by January 1, 2012. In addition, CMS employs Medicaid Integrity Contractors (“MICs”) to perform post-payment audits of Medicaid claims and identify overpayments. The Healthcare Reform Acts increases federal funding for the MIC program for federal fiscal year 2011 and later years. In addition to RACs and MICs, the state Medicaid agencies and other contractors have increased their review activities. MICs are assigned to five geographic regions and have commenced audits in states assigned to those regions. It is possible that our clinics will receive letters from RAC auditors requesting repayment of alleged overpayments for services and will incur expenses associated with responding to and appealing these RAC requests, as well as the costs of repaying any overpayments. Demands for repayments can occur even if a clinic is acquired by means of an asset transfer. If we have inadequate resources to enable us to dispute and overturn such demands for overpayments, it is possible that such payments will have to be returned which could have a material adverse effect on our financial condition and results of operations.

We intend to use third party coding and billing agencies but there is no assurance that such agencies will not make coding and billing errors causing us to understate or overstate revenues, subjecting us to penalties and demands for refunds or leading to attempts to recover funds.

Interpretation of the correct billing procedures mandated by the ICD-10 requires specific expertise. It is our intention to employ the services of qualified, third party coding and billing services to maximize billing revenues. There are a number of such third party agencies and their level of expertise and experience varies. Regardless of which agency we may use, there is no assurance that correct codes will be used which could lead to a significant reduction in revenues that may be properly claimed or a significant overpayment to us from the funding agencies. In the case of overpayments, the funding agencies will most likely demand refunds and may impose penalties which could have a material and adverse effect on our business and results of operations. In the case of underpayments, we may attempt to resubmit the billings to recover the revenues that were not claimed. There could be a substantial cost to undertake this effort which would affect our projected profitability. There is no assurance that we would be successful in receiving further payments.

If we acquire a clinic that has made coding and billing errors prior to our ownership, we would most likely be liable for those errors that led to overpayments and may be subject to penalties as well as being required to provide refunds.

Historical coding and billing errors made by a clinic prior to our acquisition, even in the case of solely an asset acquisition, may require us to provide refunds to payors and possibly pay penalties. In the case of underpayments, it is very unlikely that we would be able to collect funds that were owed to the clinic prior to our acquisition. In order to mitigate this risk, we intend to employ consultants at the due diligence stage of acquiring a clinic to conduct a compliance audit. There can be no assurance that any such compliance audit will disclose any future liabilities for overpayments that any of our clinics may have incurred.

Changes in the rates or methods of third-party reimbursements for medical services could result in reduced demand for our services or create downward pricing pressure, which would result in a decline in our revenues and harm to our financial position.

Third-party payors such as Medicare, Tricare and commercial health insurance companies, may change the rates or methods of reimbursement for the services we plan to provide and could have a significant negative impact on those revenues. At this time, we cannot predict the impact of rate reductions will have on our future revenues or business. Moreover, patients on whom we will depend for the majority of our medical clinic revenues generally rely on reimbursement from third-party payors. If our patients receive decreased reimbursement, this could result in a reduced demand for our services or downward pricing pressures, which could have a material impact on our financial position.

Furthermore, the Budget Control Act of 2011 (“BCA”) requires automatic spending reductions of $1.2 trillion for federal fiscal years 2013 through 2021, minus any deficit reductions enacted by Congress and debt service costs. We are unable to predict how these spending reductions will be structured or how they would impact us, what other deficit reduction initiatives may be proposed by Congress or whether Congress will attempt to suspend or restructure the automatic budget cuts. We can give you no assurances that future changes to reimbursement rates by government healthcare programs, cost containment measures by private third-party payors or other factors affecting payments for healthcare services will not adversely affect our future revenues, operating margins or profitability.

Managed care organizations may prevent their members from using our services which would cause us to lose current and prospective patients.

Healthcare providers participating as providers under managed care plans may be required to refer medical services to specific medical clinics depending on the plan in which each covered patient is enrolled. These requirements may inhibit their members from using our medical services in some cases. The proliferation of managed care may prevent an increasing number of their members from using our services in the future which would cause our revenues to decline.

Stark Law prohibition on physician referrals may be interpreted so as to limit our prospects.

The Ethics in Patient Referral Act of 1989, as amended (the "Stark Law"), is a civil statute that generally (i) prohibits physicians from making referrals for designated health services to entities in which the physicians have a direct or indirect financial relationship and (ii) prohibits entities from presenting or causing to be presented claims or bills to any individual, third party payer, or other entity for designated health services furnished pursuant to a prohibited referral. Under the Stark Law, a physician may not refer patients for certain designated health services to entities with which the physician has a direct or indirect financial relationship, unless allowed under an enumerated exception. Under the Stark Law, there are numerous statutory and regulatory exceptions for certain otherwise prohibited financial relationships. A transaction must fall entirely within an exception to be lawful under the Stark Law.

The Stark Law contains significant civil sanctions for violations, including denial of payment, refunds of amounts collected in violation of the Stark Law and exclusion from Medicare programs. In addition, OIG may impose a penalty of $10,000 for submitting an illegal claim or not refunding such a claim on a timely basis and a civil monetary penalty of up to $100,000 for each circumvention arrangement or scheme.

We believe that any referrals between or among the Company, the physicians providing services and the facilities where procedures are performed will be for services compliant under the Stark Law. If these arrangements are found to violate the Stark Law, we may be required to restructure such services or be subject to civil or criminal fines and penalties, including the exclusion of our Company, the physicians, and the facilities from the Medicare programs, any of which events could have a material adverse effect on our business, financial condition and results of operations.

Some states have enacted statutes, similar to the federal Anti-Kickback Statute and Stark Law, applicable to our operations because they cover all referrals of patients regardless of the payer or type of healthcare service provided. These state laws vary significantly in their scope and penalties for violations. Although we will endeavor to structure our business operations to be in material compliance with such state laws, authorities in those states could determine that our business practices are in violation of their laws. This could have a material adverse effect on our business, financial condition and results of operations.

Fee-splitting prohibitions in some states may be interpreted so as to limit our prospects.

Many states prohibit medical professionals from paying a portion of a professional fee to another individual unless that individual is an employee or partner in the same professional practice. If we violate a state's fee-splitting prohibition, we may be subject to civil or criminal fines, and the physician participating in such arrangements may lose his or her licensing privileges. Many states do not offer clear guidance on what relationships constitute fee-splitting, particularly in the context of providing management services for doctors. We have endeavored to structure our business operations in material compliance with these laws. However, state authorities could find that fee-splitting prohibitions apply to our business practices in their states. If any aspect of our operations were found to violate fee-splitting laws or regulations, this could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Facility licensure requirements in some states may be costly and time-consuming, limiting or delaying our operations.

State Departments of Health may require us to obtain licenses in the various states in which we have our pain care clinics. We intend to obtain the necessary material licensure in states where licensure is required. However, not all of the regulations governing the need for licensure are clear and there is limited guidance available regarding certain interpretative issues. Therefore, it is possible that a state regulatory authority could determine that we are improperly conducting business operations without a license in that state. This could subject us to significant fines or penalties, result in our being required to cease operations in that state or otherwise have a material adverse effect on our business, financial condition and results of operations.

Health Insurance Portability and Accountability Act compliance is critically import to our continuing operations.

In December 2000, the U.S. Department of Health and Human Services ("DHHS") released final health privacy regulations implementing portions of the Administrative Simplification Provisions of the Health Insurance Portability and Accountability Act of 1996 ("HIPAA"). These final health privacy regulations were effective in April 2003, for providers that engage in certain electronic transactions, including the submission of claims for payment. Additionally, DHHS published final standards to protect the security of health-related information in February 2003. Finally, in August 2009 DHHS published interim final breach notification regulations implementing section 13402 of the Health Information Technology for Economic and Clinical Health ("HITECH") Act. The HIPAA privacy and security regulations and the HITECH Act extensively regulate the use and disclosure of individually identifiable health-related information. Our clinics and physicians will be covered entities under HIPAA if those entities provide services that are reimbursable under Medicare or other third-party payers. Although the covered health care providers themselves are primarily liable for HIPAA compliance, as a "business associate" to these covered entities we are bound indirectly to comply with the HIPAA privacy regulations, and we are directly bound to comply with certain of the HIPAA security regulations. Although we cannot predict the total financial or other impact of these privacy and security regulations on our business, compliance with these regulations could require us to incur substantial expenses, which could have a material adverse effect on our business, financial condition and results of operations. In addition, we will continue to remain subject to any state laws that are more restrictive than the privacy regulations issued under the Administrative Simplification Provisions.

If we are unable to effectively compete for physicians, contracts, patients and strategic relationships, our business would be adversely affected.

The healthcare business is highly competitive. We will be competing with other facilities, such as hospitals and private clinics, for physicians to staff our clinics, patients and to obtain contracts with funding agencies. In some of the markets in which we plan to operate, there are shortages of physicians in our targeted specialty. In addition, physicians, hospitals, payors and other providers may form integrated delivery systems that restrict physicians who may otherwise be willing to treat certain patients at our clinics on a part-time basis outside of their main employment. These restrictions may impact our clinics and the medical practices of physicians with whom we may otherwise enter into service agreements. Some of our competitors may have greater resources than we do, including financial, marketing, staff and capital resources, have or may develop new technologies or services that are attractive to physicians or patients, or have established relationships with physicians and payors.

We may also be competing in the future with public and private companies in the development and acquisition of clinics. Further, many physician groups develop clinics without a corporate partner. We can give you no assurances that we will be able to compete effectively in any of these areas.

Competition for the acquisition of new clinics and other factors may impede our ability to acquire clinics and may inhibit our growth.

We anticipate that the future growth of our business will be dependent upon our successful acquisition of clinics. The success of this strategy depends upon our ability to identify suitable acquisition candidates, reach agreements to acquire these clinics, obtain necessary financing on acceptable terms and successfully integrate the operations of these businesses. In pursuing acquisition opportunities, we may compete with other companies that have similar growth strategies. Some of these competitors are larger and have greater financial and other resources than we have. This competition may prevent us from acquiring clinics that could generate substantial revenues for our business.

If regulations or regulatory interpretations change, we may be obligated to buy out interests of physicians who retain equity in any clinics in which we have the majority interest.

We expect that we will acquire complete ownership of most of the clinics that we choose to purchase either through share or asset purchases although in some cases, the selling physician or physicians may retain a minority interest. If certain regulations or regulatory interpretations change, we may be obligated to purchase some or all of the non-controlling interests of the physician partners. The regulatory changes that could trigger such obligations include changes that:

make the referral of Medicare and other patients to our clinics by physicians affiliated with us illegal;

create the substantial likelihood that cash distributions from limited liability companies to the affiliated physicians will be illegal; or

cause the ownership by the physicians of interests in limited liability companies to be illegal.

The cost of repurchasing these non-controlling interests would be substantial if a triggering event were to result in simultaneous purchase obligations at a substantial number or at all of our clinics. We anticipate that the purchase price to be paid in such event would be determined by a predefined formula set out in a shareholders’ agreement, which also provide for the payment terms, generally over a period of time. There can be no assurance, however, that our existing capital resources would be sufficient for us to meet the obligations, if they arose, to purchase these non-controlling interests held by physicians. The determination of whether a triggering event has occurred generally would be made by the concurrence of our legal counsel and counsel for the physician partners or, in the absence of such concurrence, by a nationally recognized law firm having an expertise in healthcare law jointly selected by both parties. Such determinations therefore would not be within our control. The triggering of these obligations could have a material adverse effect on our financial condition and results of operations. While we will ensure, to the best of our abilities that physician ownership of an interest in any clinic is in compliance with applicable laws, we can give no assurances that legislative or regulatory changes would not have an adverse impact on us. From time to time, the issue of physician ownership in clinics is considered by some state legislatures and federal and state regulatory agencies.

Risks Related to Our Securities

Our stock price may be volatile or may decline regardless of our operating performance, and you may lose part or all of your investment.

While there is presently a market for our common stock, if an active market develops, the market price of our common stock may nevertheless fluctuate widely in response to various factors, some of which are beyond our control, including:

market conditions or trends in the healthcare industry or in the economy as a whole;

actions by competitors;

actual or anticipated growth rates relative to our competitors;

the public’s response to press releases or other public announcements by us or third parties, including our filings with the SEC;

economic, legal and regulatory factors unrelated to our performance;

any future guidance we may provide to the public, any changes in such guidance or any difference between our guidance and actual results;

changes in financial estimates or recommendations by any securities analysts who follow our common stock;

speculation by the press or investment community regarding our business;

litigation;

changes in key personnel; and

future sales of our common stock by our officers, directors and significant shareholders.

In addition, the over-the-counter markets in which our common stock is being quoted, have experienced, at times, extreme price and volume fluctuations that have affected and continue to affect the market prices of equity securities of many companies. These broad market fluctuations may materially affect our stock price, regardless of our operating results. Market fluctuations and volatility, as well as general economic, market and political conditions, could reduce our market price. As a result, these factors may make it more difficult or impossible for you to sell our common stock for a positive return on your investment. In the past, shareholders have instituted securities class action litigation following periods of market volatility. If we were involved in securities litigation, we could incur substantial costs and our resources and the attention of management could be diverted from our business.

Our common stock may lack a significant trading market, which could make it more difficult for an investor to sell our common stock.

While we are approved for trading by the Financial Industry Regulatory Authority (“FINRA”) with the symbol CPAI and our shares have traded in the over-the-counter market, there is no assurance that an active trading market in our common stock will develop, or if such a market develops, that it will be sustained. In addition, there is a greater chance for market volatility for securities quoted in the over-the-counter markets as opposed to securities traded on a national exchange. This volatility may be caused by a variety of factors, including the lack of readily available quotations, the absence of consistent administrative supervision of “bid” and “ask” quotations and generally lower trading volume. As a result, an investor may find it more difficult to dispose of, or to obtain accurate quotations as to the market value of, our common stock, or to obtain coverage for significant news events concerning us, and our common stock could become substantially less attractive for investment by financial institutions, as consideration in future capital raising transactions or for other purposes.

Our common stock is subject to the “penny stock” rules of the SEC and the trading market in our securities is limited, which makes transactions in our common stock cumbersome and may reduce the value of an investment in our common stock.

The SEC has adopted Rule 3a51-1 which establishes the definition of a “penny stock,” for the purposes relevant to us, as any equity security that (i) has a market price of less than $5.00 per share or with an exercise price of less than $5.00 per share, or (ii) is not registered on a national securities exchange or listed on an automated quotation system sponsored by a national securities exchange. For any transaction involving a penny stock, unless exempt, Rule 15g-9 of the Exchange Act requires:

that a broker or dealer approve a person’s account for transactions in penny stocks; and

the broker or dealer receive from the investor a written agreement to the transaction, setting forth the identity and quantity of the penny stock to be purchased.

In order to approve a person’s account for transactions in penny stocks, the broker or dealer must:

obtain financial information and investment experience objectives of the person; and

make a reasonable determination that the transactions in penny stocks are suitable for that person and the person has sufficient knowledge and experience in financial matters to be capable of evaluating the risks of transactions in penny stocks.

The broker or dealer must also deliver, prior to any transaction in a penny stock, a disclosure schedule prescribed by the SEC relating to the penny stock market, which, in highlight form:

sets forth the basis on which the broker or dealer made the suitability determination; and

attests that the broker or dealer received a signed, written agreement from the investor prior to the transaction.

Due to the requirements of the penny stock rules, many broker-dealers have decided not to trade penny stocks. As a result, the number of broker-dealers willing to act as market makers in such securities is limited. If we remain subject to the penny stock rules for any significant period, it could have an adverse effect on the market, if any, for our securities. Moreover, if our securities are subject to the penny stock rules, investors will find it more difficult to dispose of our securities.

Future sales of shares of our common stock, or the perception in the public markets that these sales may occur, may depress our stock price.

The market price of our common stock could decline significantly as a result of sales of a large number of shares of our common stock in the market after our stock commences trading. In addition, if our significant shareholders sell a large number of shares, or if we issue a large number of shares, the market price of our stock could decline. Any issuance of additional common stock, or warrants or options to purchase our common stock, by us in the future would result in dilution to our existing shareholders. Such issuances could be made at a price that reflects a discount or a premium to the then-current trading price of our common stock. Moreover, the perception in the public market that shareholders might sell shares of our stock or that we could make a significant issuance of additional common stock in the future could depress the market for our shares. These sales, or the perception that these sales might occur, could depress the market price of our common stock or make it more difficult for us to sell equity securities in the future at a time and at a price that we deem appropriate.

We could issue additional common stock, which might dilute the book value of our common stock.

Our Board of Directors has authority, without action or vote of our shareholders, to issue all or a part of our authorized but unissued shares. Our certificate of incorporation, as amended, authorizes the issuance of up to 500,000,000 shares. As of date of this report on Form 10-K, there were 119,438,500 shares of our common stock outstanding. Although we have no commitments as of the date of this report to issue additional securities, we may issue a substantial number of additional shares of our common stock or debt securities to complete a business combination or to raise capital. Such stock issuances could be made at a price that reflects a discount or a premium from the then-current trading price of our common stock. In addition, in order to raise capital, we may need to issue securities that are convertible into or exchangeable for a significant amount of our common stock. These issuances would dilute your percentage ownership interest, which would have the effect of reducing your influence on matters on which our shareholders vote, and might dilute the book value of our common stock. You may incur additional dilution if holders of stock options and warrants, whether currently outstanding or subsequently granted, exercise their options or warrants to purchase shares of our common stock.

We do not anticipate paying dividends in the foreseeable future, and, accordingly, any return on investment may be limited to the value of our common stock.

We do not anticipate paying cash dividends on our common stock in the foreseeable future. The payment of dividends on our common stock will depend on earnings, financial condition and other business and economic factors affecting it at such time as the Board of Directors may consider relevant. We intend to follow a policy of retaining all of our earnings to finance the development and execution of our strategy and the expansion of our business. If we do not pay dividends, our common stock may be less valuable because a return on your investment will occur only if our stock price appreciates.

Our largest shareholders have significant control over our common stock and may be able to control our Company indefinitely.

Our largest shareholders currently have beneficial ownership of approximately 78% of our outstanding common stock. This significant stockholder therefore has considerable influence over the outcome of all matters submitted to our stockholders for approval, including the election of directors and the approval of significant corporate transactions.

ITEM 1B. UNRESOLVED STAFF COMMENTS.

As of December 31, 2015, there were no outstanding or unresolved staff comments on the company.

ITEM 2. PROPERTIES

We have office services provided to us at 48 Wall Street, New York, NY 10005. We have no other properties but are actively pursuing the acquisition of a number of clinics that specialize in the treatment and management of chronic pain and, if the sellers of the clinics also own the property on which the clinics are located, we may also acquire the property or take an option of the property.

ITEM 3. LEGAL PROCEEDINGS

At the time of this report, we are not involved in any legal proceedings.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable

PART II

ITEM 5. MARKET FOR OUR COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

(a) Market Information. On July 15, 2014, our Common Stock became eligible for trading on the OTCBB under the original name, OICco Acquisition I, Inc. and the symbol, OCAQ. On October 31, 2014, the name of the company was changed to Champion Pain Care Corporation. A new ticker symbol, CPAI, and a new CUSIP Number, 158571109, were assigned. No assurance can be given that any market for our Common Stock will ever develop.

(b) Unregistered Sales of Equity Securities. On October 18, 2013, pursuant to the Exchange Agreement, we issued 31,500,000 shares of our restricted common stock to Champion Toronto, which was the shareholder of CPCC, in exchange for all of the outstanding capital stock of CPCC. The issuance of our common stock to Champion Toronto was exempt from the registration requirements of the Securities Act pursuant to Section 4(2). These shares of our common stock have not been registered under the Securities Act and may not be offered or sold absent registration or an applicable exemption from registration requirements. Also effective on October 18, 2013, concurrent with the completion of the Exchange Agreement, 8,500,000 of our restricted common shares were issued to 11 individuals for past services rendered.

On November 21, 2014, we issued 238,500 shares of our restricted common stock to redeem convertible debentures valued at $47,690 plus accumulated interest of $3,885.

On September 15, 2014, we issued 150,000 shares of our restricted common stock in exchange for services valued at $30,000 for website management and hosting and social media activities for one year commencing on September 15, 2014.

On November 24, 2014, we issued 1,500,000 shares of our restricted common stock to Champion Toronto in exchange for services rendered to the Issuer by Champion Toronto valued at $320,400 which reduced the Related Party Payable to Champion Toronto by that amount.

On May 6, 2015, we issued 4,500,000 shares of our restricted common stock valued at $409,950 in exchange for general management consulting services.

On June 9, 2015, we issued 50,000 shares of our restricted common stock valued at $3,000 in exchange for a general release.

On June 19, 2015, we issued 40,000,000 shares of our restricted common stock to Champion Toronto in exchange for services rendered to the Issuer by Champion Toronto valued at $200,000 which reduced the Related Party Payable to Champion Toronto by that amount.

On June 19, 2015, we issued 8,000,000 shares of our restricted common stock valued at $556,000 in exchange for general management consulting services.

On June 19, 2015, we issued 10,000,000 shares of our restricted common stock valued at $695,000 to the CEO, Garland A. Brown, Jr. and an additional 10,000,000 shares of our restricted common stock valued at $695,000 to the COO, Mark H. Conner, as partial compensation under the terms of their respective Employment Agreements.

(c) Holders. Our authorized capital consists of 500,000,000 shares of common stock, par value of $0.0001 per share. As of December 31, 2015, there were 119,438,500 shares of Common Stock issued and outstanding held by 75 record holders. No other classes of shares are issued or authorized.

(d) Dividend Policy

We have not declared or paid any cash dividends on our Common Stock and do not intend to declare or pay any cash dividend in the foreseeable future. The payment of dividends, if any, is within the discretion of the Board of Directors and will depend on our earnings, if any, our capital requirements and financial condition and such other factors as the Board of Directors may consider.

ITEM 6. SELECTED FINANCIAL DATA.

This item is not required for smaller reporting companies.

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

Overview

The following discussion highlights the principal factors that have affected our financial condition and results of operations as well as our liquidity and capital resources for the periods described. This discussion should be read in conjunction with our Consolidated Financial Statements and the related notes included in Item 8 of this Form 10-K. This discussion contains forward-looking statements. Please see the explanatory note concerning “Forward-Looking Statements” in Part I of this Annual Report on Form 10-K and Item 1A. Risk Factors for a discussion of the uncertainties, risks and assumptions associated with these forward-looking statements.

We intend to acquire equity ownership or assets of medical clinics that specialize in the treatment and management of chronic pain.

Our acquisition of clinics depends on the availability of funding which we have not yet obtained. On January 31, 2014, we entered into a Corporate Finance Engagement with Xnergy Financial LLC a New York and California based company, to secure the financing required for us to accomplish the goals set forth above. We terminated that agreement effective February 23, 2015. On July 21, 2014, we accepted an Expression of Interest from Continental Advisory Services, LLC of New York to secure funding for the acquisition of clinics and allowed this agreement to expire on January 5, 2015.

We are interested in acquiring clinics which are generating revenues and have either positive cash flow or are undervalued and have significant turnaround potential in exchange for cash and/or our securities. We currently have Memoranda of Understanding with four such clinics and have identified approximately ten additional clinics that are prospects for acquisition. We have not yet actively sought out such clinics but have had the prospects brought to our attention by business brokers and word of mouth. We will attempt to build a critical mass of clinics within selected geographical areas so that we can achieve efficiencies in administration, purchasing, opportunities for personnel and other activities that will benefit from having a number of clinics in close proximity.

The structure of our acquisitions are expected to vary. We intend to acquire 100% of a clinic’s equity but, depending on federal, state and municipal laws governing the ownership of medical clinics, we may enter into joint venture or partnership agreements in which we own less than 100% of a particular clinic or even be in a minority position. We may also enter into agreements to sub-license the Protocol to both private and public sector clinics and have no ownership.

We anticipate that the acquisition of clinics will be complex, risky and expensive in the early stages. As we gain experience, the risks and expenses may be mitigated but, due to the highly fragmented nature of the market, each acquisition will present unique opportunities and problems. Physicians may have personal attachments to their clinics and overvalue them. Accounting records, which generally do not adhere to GAAP, may be incomplete, inaccurate and poorly organized which will lead to complex and expensive audits and conversion to GAAP. Detailed and costly due diligence will be needed and conducted with the assistance of independent consultants to ensure the accuracy and validity of billing codes for all procedures performed at every clinic since payors may demand reimbursement, even after an asset transfer, if there are errors. Retiring physicians may be difficult to replace and physicians that stay with their clinics may not work well under the requirements of a public company. The same problems of replacing or working with key employees are also expected to occur which would add to the costs of human resources management. Integrating the operations of individual clinics, adopting best practices and new technologies, securing CARF accreditation and building a national brand will be complex and difficult, especially if any physicians in charge of clinics are resistant to change. Existing and changing legislation at the federal, state and municipal levels will require constant due diligence and updating to ensure that any particular clinic is in compliance with all applicable laws. The amount of scrutiny and restrictions that medical clinics and physicians are subjected to will also increase the burden and expense of compliance. Compliance with securities laws and regulations will affect each acquisition since it is our intention to offer our securities for all or part of each acquisition. The owners of the clinics may be required to incur significant legal and accounting costs in connection with the acquisition of a clinic, including the costs of providing information for SEC filings, agreements and related reports and documents. The Securities Exchange Act of 1934 (the "34 Act"), specifically requires that any merger or acquisition candidate comply with all applicable reporting requirements, which include providing audited financial statements to be included within the numerous filings. Certain clinic owners may refuse to comply and not proceed with a transaction even if we offer to bear the cost and deduct that from the purchase price. Other unforeseen obstacles may also inhibit or prohibit any acquisition at any time and even require divestment of certain clinics.

The analysis of new acquisition prospects will be undertaken by, or under the supervision of, our President, COO and CFO who are not professional business analysts. To assist management with acquisitions, we will engage the services of consultants and advisors in addition to our legal counsel and accountants to evaluate such information as the billing practices, medical procedures and personnel. We will concentrate on identifying preliminary prospective business opportunities which may be brought to our attention through business brokers, word of mouth, direct solicitation of clinic owners, attending conferences or other referrals. In analyzing prospective clinic acquisitions we will consider such matters as the availability of required personnel, financial resources, working capital and other financial requirements, history of operations, prospects for the future, nature of present and expected competition, the quality and experience of management services which may be available and the depth of that management, specific risk factors, the potential for growth or expansion, existing and expected profitability, the perceived public recognition of services and name identification and other relevant factors. We will conduct site visits and meet personally with the owners, physicians, management and key personnel of each clinic and, to the extent possible, require written reports. We will not acquire any clinic for which audited financial statements cannot be obtained within a reasonable period of time after closing of the proposed transaction.

Any merger or acquisition completed by us may have a significant dilutive effect on the percentage of shares issued by us.

We will participate in an acquisition only after the negotiation and execution of appropriate written agreements. Although the terms of such agreements cannot be predicted, generally such agreements will require specific representations and warranties by all of the parties, will specify certain events of default, will detail the terms of closing and the conditions which must be satisfied by each of the parties prior to and after such closing, will outline the manner of bearing costs, including costs associated with our attorneys and accountants, will set forth remedies on default and will include miscellaneous other terms and will include provisions for non-competition, non-disclosure and non-solicitation.

As stated above, we will not acquire or merge with any entity which cannot provide independent audited financial statements within a reasonable period of time after closing of the proposed transaction. We are subject to all of the reporting requirements included in the 34 Act. Included in these requirements is our affirmative duty to file independent audited financial statements as part of our Form 8-K to be filed with the Securities and Exchange Commission upon consummation of a merger or acquisition, as well as our audited financial statements included in our annual report on Form 10-K (or 10-KSB, as applicable). If such audited financial statements are not available at closing, or within time parameters necessary to insure our compliance with the requirements of the 34 Act, or if the audited financial statements provided do not conform to the representations made by the clinic to be acquired in the closing documents, the closing documents may provide that the proposed transaction will be voidable, at the discretion of the present management of the Company.

Sources of revenues

At the time of this report, we have no revenues.

Critical Accounting Policies

Basis of Presentation

The accompanying financial statements of the Company have been prepared by the Company in accordance with accounting principles generally accepted in the United States.

Use of Estimates

The preparation of these financial statements in accordance with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses in the reporting period. The Company regularly evaluates estimates and assumptions related to recoverability of long-lived assets, and deferred income tax asset valuations. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between estimates and the actual results, future results of operations will be affected.

Related parties

A party is considered to be related to the Company if the party directly or indirectly or through one or more intermediaries, controls, is controlled by, or is under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. A party which can significantly influence the management or operating policies of the transacting parties or if it has an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests is also a related party.

Basic and Diluted Net Loss per Share

The Company computes loss per share in accordance with ASC 260, Earnings per Share. ASC 260 requires presentation of both basic and diluted earnings per share (“EPS”) on the face of the income statement. Basic EPS is computed by dividing net loss available to common shareholders (numerator) by the weighted average number of common shares outstanding (denominator) during the period. Diluted earnings per share gives effect to all dilutive potential common shares outstanding during the period including stock warrants and options, using treasury stock method, and convertible preferred stock using the if-converted method. As there are no dilutive securities issued, basic and diluted loss per share is the same for the period from January 31, 2015 through December 31, 2015.

Results of Operations

There were no operations prior to the date of this report. We are showing a net loss of $861,202 for the year ended December 31, 2014 and an accumulated deficit of $1,643,017 as of December 31, 2014. For the year ended December 31, 2015, we showing a net loss of $5,846,530 and an accumulated deficit of $7,489,547as of December 31, 2015. On December 31, 2015, assets were $27,764 in cash deposited with our subsidiary, CPCC in BMO Bank of Montreal and our account at Alliance Bank of Arizona compared to $343 in the BMO Bank of Montreal account of CPCC as of December 31, 2014. Liabilities were $1,282,297 as of December 31, 2014 and $2,017,298 as of December 31, 2015.

Year Ended December 31, 2014 Compared to Year Ended December 31, 2015

Net Sales

We had no sales for the period.

Cost of sales

We had no cost of sales for either period.

Gross Profit or Loss

We had no gross profit or loss for either period.

Net Losses

For the year ended through December 31, 2014, a net loss of $861,202 was incurred. Expenses consisted of $58,181 for accounting, audit and legal fees. Legal fees included the costs for assisting us with corporate finance, FINRA and SEC submissions, initiation of trading of our shares, the name change, investment documents, clinic reviews, inter-company agreements and general legal counsel.

The bulk of the remaining expenses were incurred under the Services Agreement between CPCC and Champion Toronto for services provided by Champion Toronto which included corporate finance, FINRA and SEC submissions, drafting investment documents and inter-company agreements, evaluating acquisition prospects, negotiation and preparation of agreements with medical clinics, due diligence investigations of medical clinics under MoU, preparing marketing materials and financial projections for prospective investors, participating in discussions with prospective investors and general administrative requirements.

For the year ended December 31, 2015, a net loss of $5,846,530 was incurred. These expenses consisted of $42,059 for accounting, audit and legal fees. Legal fees included the costs for assisting us with corporate finance, FINRA and SEC submissions, increasing the authorized share capital, new share issuances to related parties and third parties, appointment of new directors and officers, preparation of Executive Employment and Consulting Agreements, investment documents, clinic reviews, amendments to inter-company agreements and general legal counsel.

The increase in our net loss for the year ended December 31, 2015 compared to the year ended December 31, 2014 was primarily attributed to the one-time Stock Based Compensation costs and the loss that resulted from the issuance of shares in partial settlement of the payable to Champion Toronto that occurred during the second quarter of 2015.

During the year ended December 31, 2015, we incurred one-time Stock Based Compensation costs of $2,358,950 for 32,550,000 shares as follows:

10,000,000 shares issued to each of the CEO and COO, who were appointed on June 19, 2015, under the terms of their Executive Employment Agreements (attached as Exhibits 10.9 and 10.10, respectively, to the Form 8-K filed by the company on June 15, 2015);

12,500,000 shares to CGPM, LLC under the terms of the Consulting Agreement between the Company and CGPM (attached as Exhibit 10.8 to the Form 8-K filed by the company on May 7, 2015) and 50,000 shares issued in settlement of a claim for legal services.

During the year ended December 31, 2015, we issued 40,000,000 shares to Champion Toronto in partial payment for services rendered under the Services Agreement in place between the Company and Champion Toronto and recognized a loss of $2,580,000 which was the difference between the market price of the shares and the deemed value of $0.005 per share.

The bulk of the remaining expenses were incurred under the Services Agreement between CPCC and Champion Toronto for services provided by Champion Toronto which included drafting of all filings required by the SEC, evaluating acquisition prospects, preparation and negotiation of Memoranda of Understanding (“MoU”) with medical clinics, due diligence investigations of medical clinics under MoU, preparing marketing materials and financial projections for prospective investors, participating in discussions with prospective investors, increasing the authorized capital of the Company, issuance of new shares, recruiting new Directors and Officers, drafting of Executive Employment Agreements and for fulfilling our general administrative requirements.

Liquidity and Capital Resources

Cash and cash equivalents at December 31, 2014 and 2015 were $343 and $27,764, respectively. As of December 31, 2014 and 2015 we had total stockholders’ deficits of $1,281,954 and $1,989,534, respectively.

There are now 119,438,500 Common Shares of the Company issued and outstanding as of December 31, 2015 and as of the date of this report.

No warrants or options have been issued from as of December 31, 2014 and 2015.

The Company’s financial statements are prepared in accordance with generally accepted accounting principles applicable to a going concern. This contemplates the realization of assets and the liquidation of liabilities in the normal course of business. Currently, the Company has minimal cash, no material assets and does not have operations or a source of revenue sufficient to cover its operation costs to allow it to continue as a going concern. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The Company will be dependent upon the raising of additional capital through placement of its common stock or debt in order to implement its business plan. There can be no assurance that the Company will be successful in either situation in order to continue as a going concern.

We are actively looking for either equity or debt financing or both to settle our current and future liabilities and to accomplish our plans but there is no assurance that we will be able to do so.

Commitments

We do not have any commitments which are required to be disclosed as of December 31, 2015.

Off-Balance Sheet Arrangements

As of December 31, 2015, we are not aware of any off-balance sheet transactions requiring disclosure.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

This item is not required for smaller reporting companies.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

See the Financial Statements below, beginning on page F-1.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.

There have been no changes in or disputes with accountants on accounting or financial disclosure for the periods covered in this Form 10-K.

ITEM 9A. CONTROLS AND PROCEDURES.

(a) Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our CFO, carried out an evaluation of the effectiveness of our “disclosure controls and procedures” (as defined in the Exchange Act Rules 13a-15(e) and 15-d-15(e)) as of the end of the period covered by this report (the “Evaluation Date”). Based upon that evaluation, the CFO concluded that as of the Evaluation Date, our disclosure controls and procedures are not effective to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act (i) is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms and (ii) is accumulated and communicated to our management, including our CFO, as appropriate to allow timely decisions regarding required disclosure.

(b) Management’s Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act). Our management assessed the effectiveness of our internal control over financial reporting as of December 31, 2015. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework. Our management has concluded that, as of December 31, 2015, our internal control over financial reporting is not effective based on these criteria. This annual report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the SEC that permit us to provide only management’s report in this annual report.

Based on that assessment, our management has determined that as of December 31, 2015, the Company’s internal control over financial reporting were not effective for the purposes for which it is intended. Specifically, management’s evaluation was based on the following material weaknesses, which existed as of December 31, 2015:

There is a lack of segregation of duties necessary for a good system on internal control due to insufficient accounting staff due to the size of the Company.

Management and accounting staffs lack qualifications and training to fulfill their assigned accounting and reporting functions.

There is a lack of controls related to multiple levels of review and overall supervision over financial reporting and related financial statements disclosures.

Prior to the next year end, the Company intends to hire additional accounting personnel who will institute controls regarding the assignment of authority and responsibility, consistent policies and procedures, monitoring of controls and adequate disclosure controls.

This annual report does not include an attestation report of the Company’s registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the Company’s registered public accounting firm pursuant to temporary rules of the SEC that permit the Company to provide only management’s report in this annual report.

There were no changes in our internal controls over financial reporting that occurred during the last fiscal year covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

ITEM 9B. OTHER INFORMATION

None.

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.

The following table sets forth information concerning our officers and directors as of December 31, 2015.

Name

Position

Age

Period of Service⁽¹⁾

Garland A. Brown, Jr.

CEO and Director

June 15, 2015 to present

Mark H. Conner

COO

June 15, 2015 to present

Jack Fishman

President and Director

October 18, 2013 to present

Emil Schiller

Director

October 18, 2013 to present

Terrance Owen

Director

(& CFO as of 3/16/16)

October 18, 2013 to present

Our executive officers are appointed by, and serve at the discretion of, our Board of Directors. Each executive officer is a full time employee. Our directors hold office for one-year terms or until their successors have been elected and qualified. There are no family relationships between any of our directors, executive officers or other key personnel and any other of our directors, executive officers or key personnel. There are no arrangements or understandings between any of our directors or executive officers and any other persons pursuant to which such director or executive officer was selected in that capacity.

BACKGROUND OF DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS

Garland A. Brown, Jr., CEO and Director

Garland A. Brown, Jr. is an attorney and co-founder of the Scottsdale, Arizona law firm, Weiss Brown. Mr. Brown has focused his practice on counseling emerging technology-based companies, entrepreneurs, and established businesses on a wide range of day-to-day legal and business issues including intellectual property matters and de facto general counsel services. Mr. Brown has wide-ranging and exceptionally unique experience in the technology field that includes 12 years of senior-level experience in Redmond, Washington with Microsoft as both a lead software development engineer and as a Director in Antitrust Law Compliance. His time and experience at Microsoft, combined with his time in private practice as an attorney at the international law firm of Greenberg Traurig, has enabled him to draw on this vast experience to be a frequent speaker on issues related to early stage and emerging technology-based businesses.

Mark H. Conner, COO

Mark H. Conner founded MARS Medical Systems, Inc. (“MARS”). Originally organized as Applied Software Techniques, Mr. Conner led the strategic direction of the company since its founding in 1984. As Chief Architect of all MARS products, Mr. Conner is a pioneer in the practice management industry by making NetPracticePM™ the first fully browser-based practice management solution in 1999. Under the leadership of Mr. Conner, MARS, acquired by Noteworthy Medical Systems in 2008, again achieved an industry first in 2001 with the introduction of a series of powerful modules for NetPracticePM™. This suite of tools provided the first fully integrated and automated medical coding analysis, appointment reminders, eligibility verification, secure patient Web portal and mobile device charge capture system. Mr. Conner has successfully negotiated strategic partnerships with several major healthcare industry companies as the leader of Noteworthy's Sales and Service Partners (SSP) program.

Jack Fishman, President and Director

Mr. Fishman is one of our co-founders and leads the development and the integration of corner office strategy to front line solutions. Mr. Fishman has a successful 22-year career track record of business growth, innovation and experience in general management, sales and marketing. He has provided strategic leadership for a diverse range of major corporations and has helped develop and launch new consumer award winning business initiatives for Snap-On-Tools and Honda. He is often sought out for keynote speeches at marketing conferences, most recently the National Public Relations Conference. He is a co-founder of Champion Toronto and was appointed as the President and as a Director of our company on October 23, 2013.

Terrance Owen, Director

Dr. Owen obtained a BSc (Honours) in Biology from the University of Victoria in 1968, a MSc in Biology from the University of New Brunswick in 1970, a PhD in Zoology from the University of British Columbia in 1974 and a MBA from Simon Fraser University in 1991. From 2000 to 2013, Dr. Owen was the President, CEO & Director of ALDA Pharmaceuticals Corp. (Since renamed Vanc Pharmaceuticals Inc.) and serves as a Director and on the audit committees of three other public companies that are listed on the TSX Venture Exchange. From December, 1980 to April 2002, Dr. Owen was the President of Helix Biotech ULC, a laboratory providing DNA identity testing services for paternity, immigration and forensic cases. He was the President and a director of Helix BioPharma Corp. from July, 1995 to June, 1998. Dr. Owen began advising Champion Toronto in April, 2012 and was appointed as CEO in July, 2013. On October 23, 2013 he was appointed as the CEO and as a Director of the Company and resigned as CEO on June 15, 2015 when Mr. Brown was appointed as CEO. On March 16, 2016, Dr. Owen was appointed as CFO by the Board.

Emil Schiller, Director

Mr. Schiller is a co-founder of the Company. Under his leadership, his operational and team building programs have benefited a number of companies. Mr. Schiller is responsible for financial, operational, planning and distribution systems. Mr. Schiller is a seasoned executive with more than 22 years of international business experience. He has a broad range of high-level management experience within several industries. He has an extensive business background, having initiated several culture change initiatives, including the introduction of quality improvement programs to ensure consistent delivery of standards of excellence for major retail chains across North America. He also a co-founder of Champion and was appointed as the COO and as a Director of our company on October 23, 2013 and resigned as COO on June 15, 2015 when Mr. Conner was appointed as COO.

Involvement in certain legal proceedings

During the past ten years, none of our directors or executive officers has been:


·	the subject of any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time;


·	convicted in a criminal proceeding or is subject to a pending criminal proceeding (excluding traffic violations and other minor offenses);


·	subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities;


·	found by a court of competent jurisdiction (in a civil action), the SEC or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, that has not been reversed, suspended, or vacated;


·	subject of, or a party to, any order, judgment, decree or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of a federal or state securities or commodities law or regulation, law or regulation respecting financial institutions or insurance companies, law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or


·	subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization, any registered entity or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.

None of our directors, executive officers or affiliates, or any beneficial owner of 5% or more of our common stock, or any associate of such persons, is an adverse party in any material proceeding to, or has a material interest adverse to, us or any of our subsidiaries.

Compensation and Audit Committees

As we only have three board members and limited operations, we do not have separate or independent audit or compensation committees. Our Board of Directors has determined that it does not have an “audit committee financial expert,” as that term is defined in Item 407(d)(5) of Regulation S-K. In addition, we have not adopted any procedures by which our shareholders may recommend nominees to our Board of Directors.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Exchange Act requires our directors and executive officers and persons who beneficially own more than ten percent of our Common Stock (collectively, the “Reporting Persons”) to report their ownership of and transactions in our Common Stock to the SEC. Copies of these reports are also required to be supplied to us. To our knowledge, during the fiscal year ended December 31, 2015, the Reporting Persons had complied with all applicable Section 16(a) reporting requirements.

Code of Ethics

We have not adopted a Code of Ethics given our limited operations.

ITEM 11. EXECUTIVE COMPENSATION

Executive compensation

Executive Employment Agreements were established for the CEO and COO and were attached as Exhibits 10.9 and 10.10, respectively, to the Form 8-K filed on EDGAR by us on June 15, 2015. Under the terms of these agreements, the CEO and COO each received 10,000,000 of our Common Shares as partial compensation on June 19, 2015. No other compensation has been provided to the executives of the company at the time of this report but has been deferred until such time as the Company is adequately funded. An Executive Services Agreement was established for the President and was attached as Exhibits 10.11 to the Form 8-K filed on EDGAR by us on June 15, 2015. Under the terms of this agreement, the President receives no compensation as his services to the Company are provided through Champion Toronto which has a Services Agreement in place with the Company.

Compensation of Directors

To date, no compensation has been paid to any of our directors.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

The following table sets forth certain information as of the date of this report regarding the number and percentage of our Common Stock (being our only voting securities) beneficially owned by each officer, director, each person (including any “group” as that term is used in Section 13(d)(3) of the Exchange Act) known by us to own 5% or more of our Common Stock, and all officers and directors as a group.


Name of Beneficial Owner of Shares	Class	Shares	Percent of Class
Garland A. Brown, Jr. 48 Wall Street, 10^th Floor New York, NY 10005	Common Stock	10,000,000	8.4%
Mark H. Conner 48 Wall Street, 10^th Floor New York, NY 10005	Common Stock	10,000,000	8.4%
Champion Care Corp. 635 Fourth Line, Unit 1 Oakville, ON, L6L 5B0, Canada	Common Stock	40,355,000	33.8%
Terrance Owen, Director 635 Fourth Line, Unit 1 Oakville, ON, L6L 5B0, Canada	Common Stock	3,750,000	3.1%
Jack Fishman, President 635 Fourth Line, Unit 1 Oakville, ON, L6L 5B0, Canada	Common Stock	3,750,000	3.1%
Emil Schiller, Director 635 Fourth Line, Unit 1 Oakville, ON, L6L 5B0, Canada	Common Stock	3,750,000	5.86%
Allan Gold 635 Fourth Line, Unit 1 Oakville, ON, L6L 5B0, Canada	Common Stock	7,400,000	6.2%
Patricia Genereaux ⁽¹⁾ 635 Fourth Line, Unit 1 Oakville, ON, L6L 5B0, Canada	Common Stock	3,750,000	3.1%
Sheena Sim⁽²⁾ 635 Fourth Line, Unit 1 Oakville, ON, L6L 5B0, Canada	Common Stock	3,750,000	3.1%

⁽¹⁾ Spouse of Terrance Owen, Director

⁽²⁾ Spouse of Jack Fishman, President

Unless otherwise indicated, we have been advised that all individuals or entities listed have the sole power to vote and dispose of the number of shares set forth opposite their names. For purposes of computing the number and percentage of shares beneficially owned by a security holder, any shares which such person has the right to acquire within 60 days of the date of this report are deemed to be outstanding, but those shares are not deemed to be outstanding for the purpose of computing the percentage ownership of any other security holder. We currently do not maintain any equity compensation plans. We are not aware of any arrangements that could result in a change in control of the company.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE

Exchange Agreement

On May 29th 2013, we entered into the Exchange Agreement with CPCC, a wholly owned subsidiary of Champion Toronto. Terrance Owen, Jack Fishman and Emil Schiller are the Directors and Executive Officers of both CPCC and Champion Toronto. On completion of the Exchange Agreement on October 18, 2013, Champion acquired a 70% interest in our company with the issuance of 31,500,000 our shares to Champion Toronto in exchange for 100% of the shares of CPCC which became our wholly owned subsidiary. Messrs. Owen, Fishman and Schiller also became Directors and Executive Officers of our company on October 18, 2013 as well.

Other material agreements

License Agreement between Champion Toronto and CPCC

CPCC and Champion Toronto entered into a license agreement dated February 1, 2013, (“the License Agreement”) in which Champion Toronto provides CPCC with the exclusive rights to market and implement the Protocol in the United States (“the Territory”). The License Agreement was attached as Exhibit 10.5 to the Form 8-K filed on October 23, 2013.

The material terms of the License Agreement are as follows.

Champion Toronto provides CPCC with the exclusive right to any of Champion Toronto’s knowhow and trademarks and the right to (i) enter into licensing, joint venture and acquisition agreements with clinics that provide pain management services under the direction of physicians who are properly licensed to practice medicine and qualified to treat patients using the Protocol in the Territory; (ii) establish pharmacies that will be within or associated with clinics acquired by Licensor as permitted by the regulations enforced by the applicable governments within the Territory; and (iii) take such steps that are deemed necessary to develop the business of pain management in the Territory.

The License Agreement is subject to the laws of Ontario, Canada and the initial term is five years with automatic renewals for new 5 year terms unless the agreement is otherwise terminated.

Champion Toronto was issued 10,000 shares of CPCC which were subsequently transferred to the Company pursuant to the terms of the Exchange Agreement. CPPC is entitled to a royalty of 10% of all Net Sales in the Territory meaning the amount of sales generated after the deduction of refunds, discounts, rebates and other reductions.

On completion of the Exchange Agreement, Champion Toronto, as our majority shareholder, would cause our Board of Directors to enter into a new license agreement containing standard representations and warranties as to royalties, remedies, termination, provisions for non-competition, non-solicitation, non-disclosure and ownership of developments, discoveries and new intellectual property and would cause the name of OICco to be changed to Champion Pain Care Corp.

CPCC is a subsidiary of the Company. Although the License Agreement is still in place between CPCC and Champion Toronto, it is now a non-exclusive agreement since a license agreement has also been established directly between the Company and Champion Toronto as described below.

License Transfer Agreement between CPCC and the Company

On February 1, 2013 Champion Toronto and CPCC entered into the License Agreement which specifically provided that, upon the acquisition of CPCC by the Company, Champion Toronto, as our then majority shareholder, would cause the Board of Directors of CPCC to transfer the License Agreement to the Company while allowing CPCC to retain non-exclusive rights to the Protocol in the US. On July 1, 2014, the transfer of the License Agreement to the Company was completed through the execution of a License Transfer Agreement which was attached as Exhibit 10.6 to the Form 10-Q filed on November 19, 2014.

Services Agreement between Champion Toronto and CPCC

CPCC and Champion Toronto entered into a services agreement dated February 1, 2013 with an effective date of December 1, 2012 (“the Services Agreement”) in which Champion Toronto agreed to provide management services to CPCC in exchange for fees and for reimbursement of the costs incurred by Champion Toronto.

The material terms of the Services Agreement area as follows.

To assist CPCC with the implementation of the License Agreement, Champion Toronto has been or will be providing the following services and any other services to which the parties mutually agree.

Provide training for the Protocol, for all of the Territory as defined in the License Agreement, through health care practitioners selected by Champion Toronto who are properly licensed to practice medicine and qualified to treat patients using the Protocol in the Territory.

Establish ‘clinical excellence’ that will be within or associated with the clinics acquired by CPCC as permitted by the regulations enforced by the applicable governments within the Territory.

Take any other actions that are required to develop the business of pain management in the Territory.

Oversee all marketing activities for the Protocol in the Territory.

Provide management for all administrative, financial, and technical matters.

Oversee the public listing process for CPCC including, identifying a suitable public company vehicle, ensuring complete regulatory compliance, listing on the OTC Market and registration of the shares for trading.

The Services Agreement is subject to the laws of Ontario, Canada and the initial term is five years.

The fee structure is as follows.

Upon signing of the Services Agreement;

$10,000

January 1, 2013;

$10,000

Base payable the first of each month for the term of the agreement

$10,000

In addition to the Base, an hourly rate;

$ 400

Bonuses for clinic acquisitions as follows.

$10,000 plus 50,000 shares for each clinic that is acquired

$50,000 plus 200,000 shares for every ten (10) clinics that are acquired

Reimbursement of direct expenses

The Services Agreement was attached as Exhibit 10.6 to the Form 8-K filed on October 23, 2013.

CPCC is now an inactive subsidiary of the Company. Although the Services Agreement is still in place between CPCC and Champion Toronto, CPCC’s obligations under the Services Agreement are now being met by the Company under the terms of a Services Agreement that has been established directly between the Company and Champion Toronto as described below.

Services Agreement between Champion Toronto and the Company

On February 1, 2013, Champion Toronto and CPCC entered into the Services Agreement which specifically required that, upon the acquisition of CPCC by the Company, Champion Toronto, as our then majority shareholder, would cause our Board of Directors of to enter into a separate Services Agreement between Champion Toronto and the Company. On July 1, 2014, a Services Agreement, effective October 23, 2013, was entered into between Champion Toronto and the Company and was attached as Exhibit 10.7 to the Form 10-Q filed on November 19, 2014. The terms of this agreement do not differ in any material way with those of the Services Agreement between CPCC and Champion Toronto.

On April 1, 2015, Paragraph 3.4 of the Services Agreement was amended so that any shares accepted by Champion Toronto in lieu of unpaid fees would be at a price per share mutually agreeable to us and Champion Toronto and not based on an average trading price so as to avoid the need for accounting for derivatives. This amendment was attached as Exhibit 10.12 to the Form 8-K filed on EDGAR on June 15, 2015.

On June 12, 2015, Paragraph 3.1 of the Services Agreement was amended, effective June 19, 2015 so that fees paid to Champion Toronto for services provided by the personnel of Champion Toronto are as follows in US currency.

Jack Fishman - $18,000 per month or $240 per hour if less than full time.

Terrance Owen - $240 per hour.

Emil Schiller - $240 per hour.

Other personnel – to be determined by mutual agreement.

Increases to the fees shall be made at such times and in such amounts as mutually agreed upon by CPAI and Champion Toronto.

This amendment was attached as Exhibit 10.13 to the Form 8-K filed on EDGAR on June 15, 2015.

Executive Employment Agreements between the Company and its CEO and COO

On June 12, 2015, the Company entered into Employment Agreements (“Agreements”) with Garland A. Brown, Jr. and Mark H. Conner (the “Executives”) to act as CEO and COO, respectively. Copies of the Agreements were attached to the Form 8-K filed on EDGAR on June 15, 2015 as Exhibits 10.9 and 10.10.

Under the terms of the Agreements, which came into effect on June 19, 2015, the CEO and COO are to receive annual salaries of $200,000 and $180,000, respectively, with any changes to be made at the discretion of the Board of Directors (the “Board”). Each Executive has received 10,000,000 Common Shares of Company Stock. The CEO and COO are eligible to receive annual performance bonuses of up to $300,000 and $260,000 per annum, respectively, when 100% of the goals, as agreed upon by the Board in consultation with the Executive, have been fulfilled. The bonuses are to be proportional to the achievement of the defined goals. Any additional bonuses to be provided to an Executive when goals are exceeded are at the discretion of the Board. The terms and conditions of Executives’ bonus plans shall be set forth in a separate document. At the date of this report, no bonus plans have been prepared. The Company shall reimburse the Executives for all ordinary and necessary business expenses incurred in connection with Executives’ employment. The Executives shall be entitled to receive a minimum of four (4) weeks of paid vacation time. The Executives shall be eligible to participate in all health benefits, insurance programs, retirement plans and other employee benefit and compensation arrangements that the Company may provide to its executive employees. The Company shall cover the Executives under a standard directors and officers liability insurance policy and provide Key Man Insurance for the benefit of the Company when such policies are put in place. The Executives shall be eligible to participate in any stock option and/or stock appreciation rights plan, at the discretion of the Board. The Agreements also provide provisions for assignment of interest in inventions by the Executives to the Company, protection of confidential information, non-competition, non-solicitation, termination and regulatory compliance.

Director Independence

Our Board of Directors is currently comprised of four directors, Mr. Brown, Dr. Owen, Mr. Fishman and Mr. Schiller, none of whom qualify as “Independent” directors for the purposes of the NASDAQ listed company standards currently in effect and all applicable rules and regulations of the SEC.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

MaloneBailey, LLP is our independent registered public accounting firm.

Audit Fees

The aggregate fees billed by Malone Bailey, LLP for professional services rendered for the audit of our annual financial statements on Form 10-K and review of financial statements included in our quarterly reports on Form 10-Q or services that are normally provided in connection with statutory and regulatory filings were $17,500 in 2014 and $18,500 in 2015.

Audit-Related Fees

There were no fees billed by Malone Bailey LLP for assurance and related services that are reasonably related to the performance of the audit or review of our financial statements for the fiscal year ended December 31, 2014 and 2015.

Tax Fees

No fees were billed by Malone Bailey, LLP for professional services for tax compliance, tax advice, and tax planning for the fiscal year ended December 31, 2014 and 2015.

There were no fees billed by Malone Bailey, LLP for other products and services for the fiscal year ended December 31, 2014 and 2015.

Pre-Approval Policy

We do not currently have a standing audit committee. The above services were approved by our Board of Directors.

ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a) The following documents are filed as part of this Report:

3. Exhibits Incorporated by Reference or Filed with this Report.



Exhibit No.	Description

31.1	CEO Certification pursuant to section 302 of the Sarbanes-Oxley Act of 2002*
31.2	CFO Certification pursuant to section 302 of the Sarbanes-Oxley Act of 2002
32.1	Certification pursuant to section 906 of the Sarbanes-Oxley Act of 2002.*

*Included herewith

SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act of 1934, the registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.



	Champion Pain Care Corporation

Date: April 14, 2016

	By: /s/ Garland A. Brown, Jr.
	Garland A. Brown, Jr., CEO

In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.



Date: April 14, 2016
	By: /s/ Garland A. Brown, Jr.
	Garland A. Brown, Jr., CEO & Director
	(Principal Executive Officer)

Date: April 14, 2016
	By: /s/ Terrance Owen
	Terrance Owen, CFO & Director
	(Principal Financial and Accounting Officer)

CHAMPION PAIN CARE CORPORATION

FINANCIAL STATEMENTS

December 31, 2015

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors:

Champion Pain Care Corporation

New York, NY.

We have audited the accompanying consolidated balance sheet of Champion Pain Care Corporation and its subsidiary (collectively, the “Company”) as of December 31, 2015 and 2014, and the related consolidated statements of expenses, stockholders’ deficit and cash flows for the years ended December 31, 2015 and 2014. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with standards of the Public Company Accounting Oversight Board

(United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of the Champion Pain Care Corporation and its subsidiary as of December 31, 2015 and 2014, and the related results of their consolidated operations and their cash flows for the years ended December 31, 2015 and 2014 in conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company has a working capital deficit and has incurred a net loss from operations. These matters raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans regarding those matters are also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/s/ MaloneBailey, LLP

www.malone-bailey.com

Houston, Texas

April 14, 2015

Champion Pain Care Corporation

Consolidated Balance Sheets


ASSETS	December 31, 2015	December 31, 2014
Current Assets
Cash	$ 27,764	$ 343
Total Current Assets	27,764	343

TOTAL ASSETS	$ 27,764	$ 343

LIABILITIES AND STOCKHOLDERS' DEFICIT
Current Liabilities
Accounts Payable	$ 76,168	$ 83,489
Accounts Payable - related parties	1,570,047	1,183,558
Accrued liabilities	255,833	-
Short term debt - related parties	15,250	15,250
Loan payable	100,000	-

Total Current Liabilities	$ 2,017,298	$ 1,282,297

Stockholders' Deficit
Common Stock, $0.0001 par value; 500,000,000 shares authorized;
119,438,500 and 46,888,500 issued and outstanding, respectively	11,944	4,689
Additional Paid in Capital	5,488,069	356,374
Accumulated Deficit	(7,489,547)	(1,643,017)
Total Stockholders' Deficit	$ (1,989,534)	$ (1,281,954)

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$ 27,764	$ 343

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

Champion Pain Care Corporation

Consolidated Statements of Expenses


	For the year ended	For the year ended
	December 31, 2015	December 31, 2014
Operating Expenses	$ (3,266,530)	$ (858,252)

Loss from Operations	(3,266,530)	(858,252)

Interest Expense	-	(2,950)
Loss on settlement of related party accounts payable	(2,580,000)	-

Net Loss	$ (5,846,530)	$ (861,202)

Basic and diluted loss per common share	$ (0.07)	$ (0.02)
Basic and diluted weighted average common
shares outstanding	86,191,925	45,222,164

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

Champion Pain Care Corporation

Consolidated Statement of Stockholders' Deficit

For the years ended December 31, 2014 and 2015


					Additional		Total
	Common Stock				Paid-in	Accumulated	Stockholders'
	Shares		Amount		Capital	Deficit	Deficit
Balance, December 31, 2013		45,000,000		$ 4,500	$ (41,537)	$ (781,815)	$ (818,852)

Shares issued for services		150,000		15	29,985		30,000

Shares issued in debt conversion		238,500		24	47,676		47,700

Shares issued for accounts payable related parties		1,500,000		150	320,250		320,400

Net Loss						(861,202)	(861,202)

Balance, December 31, 2014		46,888,500		$ 4,689	$ 356,374	$ (1,643,017)	$ (1,281,954)

Shares issued for services		32,550,000		3,255	2,355,695		2,358,950

Shares issued for accounts payable related parties		40,000,000		4,000	2,776,000		2,780,000

Net Loss						(5,846,530)	(5,846,530)

Balance, December 31, 2015		119,438,500		$ 11,944	5,488,069	$ (7,489,547)	$ (1,989,534)

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

Champion Pain Care Corporation

Consolidated Statement of Cash Flows


	Year ended	Year ended
	December 31, 2015	December 31, 2014
Cash Flows from operating activities
Net Loss	$ (5,846,530)	$ (861,202)
Adjustments to reconcile net loss to net cash
used in operating activities:
Forgiveness of accrued interest	-	(3,875)
Stock based compensation	2,358,950	30,000
Loss on settlement of related party accounts payable	2,580,000	-
Changes in operating assets and liabilities
Accounts payable	(7,321)	2,236
Accounts payable - related parties	586,489	814,600
Accrued liabilities	255,833	2,950
Cash used in operating activities	$ (72,579)	$ (15,291)

Cash Flows from financing activities
Borrowing on related party debt	-	15,250
Proceeds from loan payable	100,000	-
Cash provided by financing activities	100,000	15,250

Net change in cash	27,421	(41)
Cash at beginning of period	343	384
Cash at end of period	$ 27,764	$ 343

Supplemental cash flow information
Cash paid for interest	$ -	$ -
Cash paid for income taxes	$ -	$ -

Non-cash transactions
Shares issued for debt conversion	$ -	$ 47,690
Shares issued to settle accounts payable due to related party	$ 200,000	$ 320,400

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

Champion Pain Care Corporation

Notes to Consolidated Financial Statements

December 31, 2015 and 2014

NOTE 1 – NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Business

Champion Pain Care Corporation (the Company) was incorporated as OICco Acquisition I, Inc. under the laws of the State of Delaware on July 24, 2009. On October 31, 2014, the name of the Company was changed to Champion Pain Care Corporation.

On October 18, 2013, Champion Care Corp. of Toronto, Canada (“Champion Toronto”), entered into a share exchange agreement with the Company, a public shell company. Pursuant to the agreement, the Company acquired all of the outstanding shares of common stock of Champion Pain Care Corp. (“CPCC”), a Nevada corporation and a wholly owned subsidiary of Champion Toronto by issuing 31,500,000 shares of its common stock to Champion Toronto in exchange for all of the CPPC issued and outstanding shares. As a result of the share exchange, Champion Toronto controlled approximately 70% of the issued and outstanding common shares of the Company resulting in a change in control. The transaction was accounted for as a reverse recapitalization transaction, as the Company qualified as a non-operating public shell company given the fact that it held nominal monetary assets, consisting of only cash at the time of merger transaction.

The Company and CPCC hold the rights in the United States to a proprietary pain management protocol, the Champion Pain Care Protocol (the “Protocol”) which was licensed from Champion Toronto. The Company intends to acquire private medical clinics throughout the United States that specialize in the treatment and management of chronic pain and add the Protocol to the treatments already provided by acquired clinics.

The Company has elected a fiscal year end of December 31.

Principal of Consolidation

Our consolidated financial statements include the accounts of Champion Pain Care Corporation, incorporated in Delaware and quoted on the OTC Markets, and Champion Pain Care Corp., incorporated in Nevada and a wholly owned subsidiary of the Company.

Use of Estimates and Assumptions

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Related Parties

Cash and Cash Equivalents

All highly liquid investments with maturity of three months or less are considered to be cash equivalents. There were no cash equivalents as of December 31, 2014 or 2015.

Income Taxes

The Company accounts for income taxes under ASC 740 "Income Taxes". Under the asset and liability method of ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under ASC 740, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period the enactment occurs. A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations.

Non-Employee Stock-Based Compensation

The Company accounts for stock-based compensation in accordance with the provision of ASC 505, “Equity Based Payments to Non-Employees” (“ASC 505”), which requires that such equity instruments are recorded at their fair value on the measurement date. The measurement of stock-based compensation is subject to periodic adjustment as the underlying equity instruments vest.

Employee Stock-Based Compensation

The Company accounts for employee stock-based compensation in accordance with the provision of ASC 718, “Compensation – Stock Compensation”. ASC 718 requires companies to measure the cost of employee services received in exchange for an award of equity instruments, including stock options, based on the grant-date fair value of the award and to recognize it as compensation expense over the period the employee is required to provide service in exchange for the award, usually the vesting period.

Derivative Financial Instruments

The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. For stock-based derivative financial instruments, the Company uses a Black-Scholes option pricing model, assuming maximum value, in accordance with ASC 815-15 “Derivative and Hedging” to value the derivative instruments at inception and on subsequent valuation dates. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument could be required within 12 months of the balance sheet date.

Beneficial Conversion Features

The intrinsic value of a beneficial conversion feature inherent to a convertible note payable, which is not bifurcated and accounted for separately from the convertible note payable and may not be settled in cash upon conversion, is treated as a discount to the convertible note payable. This discount is amortized over the period from the date of issuance to the date the note is due using the effective interest method. If the note payable is retired prior to the end of its contractual term, the unamortized discount is expensed in the period of retirement to interest expense. In general, the beneficial conversion feature is measured by comparing the effective conversion price, after considering the relative fair value of detachable instruments included in the financing transaction, if any, to the fair value of the common shares at the commitment date to be received upon conversion.

The Company measures its financial assets and liabilities in accordance with the requirements of FASB ASC 820, “Fair Value Measurements and Disclosures”. FASB ASC 820 defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles, and expands disclosures about fair value measurements. ASC 820 establishes a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value as follows:

Level 1. Observable inputs such as quoted prices in active markets;

Level 2. Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and

Level 3. Unobservable inputs in which there is little or no market data, which requires the reporting entity to develop its own assumptions.

The Company does not have any assets or liabilities measured at fair value on a recurring basis at December 31, 2014 and 2015. The Company did not have any fair value adjustments for assets and liabilities measured at fair value on a nonrecurring basis during the periods ended December 31, 2014 and 2015.

Concentration of Credit Risks

Financial instruments that potentially subject the company to credit risk consist principally of cash and cash equivalents and receivables. The Company places its cash and cash equivalents with financial institutions. Deposits are insured to Federal Deposit Insurance Corp. limits. At December 31, 2015, there was no uninsured cash. Other financial instruments include notes payable and amounts due to related parties. Due to the short-term maturity of these obligations and the stated interest rates on notes payable, the carrying value of these instruments represent their fair value.

Earnings Per Share Information

FASB ASC 260, “Earnings Per Share” provides for calculation of "basic" and "diluted" earnings per share. Basic earnings per share includes no dilution and is computed by dividing net income (loss) available to common shareholders by the weighted average common shares outstanding for the period. Diluted earnings per share gives effect to all dilutive potential common shares outstanding during the period including stock warrants and options, using treasury stock method, and convertible preferred stock using the if-converted method. As there were no dilutive securities issued, basic and diluted loss per share is the same for the year ended December 31, 2014 and 2015.

Recent Accounting Pronouncements

The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new pronouncements that have been issued that might have a material impact on its financial position or results of operations.

NOTE 2 – GOING CONCERN

The Company’s financial statements are prepared in accordance with generally accepted accounting principles applicable to a going concern. This contemplates the realization of assets and the liquidation of liabilities in the normal course of business. Currently, the Company has minimal cash and no material assets, nor does it have operations or a source of revenue sufficient to cover its operation costs and allow it to continue as a going concern. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The Company will be dependent upon the raising of additional capital through placement of our common stock or debt financing in order to implement its business plan. There can be no assurance that the Company will be successful in either situation in order to continue as a going concern.

NOTE 3 – RELATED PARTY PAYABLES

As of December 31, 2015, the Company has payables of $1,570,047 to related parties for unpaid consulting fees and other general and administrative expenses compared to $1,183,558 as of December 31, 2014. A non-interest bearing and due on demand loan of $15,250 to a related party was outstanding as of December 31, 2014 and 2015. Accrued liabilities of $255,833 to related parties for unpaid salaries were outstanding as of December 31, 2015 compared to $Nil as of December 31, 2014. The related parties are Champion Toronto, Garland A. Brown, Jr., CEO, Mark H. Conner, COO, Terrance Owen, Director, companies owned by Terrance Owen and Nanotech Systems, Inc., a company for which Terrance Owen is the CEO and a Director.

On November 24, 2014, the Company issued 1,500,000 shares of its restricted common stock to Champion Toronto at a fair market value of $0.21 per share to reduce the amount payable to Champion Toronto, a related party due to having common directors with the Company, by $320,400.

On June, 2015, we issued 40,000,000 shares with an agreed upon value of $200,000 to Champion Toronto in partial payment for services rendered under the Services Agreement in place between the Company and Champion Toronto. The fair value of the 40,000,000 shares issued was determined to be $2,780,000 based on the stock price on the conversion date, resulting in $2,580,000 loss on settlement of related party accounts payable.

NOTE 4 – CONVERTIBLE DEBENTURES

The Company issued two convertible debentures, in principal balance of $22,690 and $25,000 through its subsidiary, CPCC. These notes had a one year term with interest to be paid at 5% per annum. The “$22,690 note” was convertible at $0.20 per share of the Company common stock. The “$25,000 note” was to be convertible at a 25% discount to the closing market price of the Company Shares on the day the Company Shares first traded. On November 21, 2014, the Company issued 238,500 shares of its restricted common stock at a fair market value of $0.20 per share to repay both convertible debentures. In the case of the $22,690 note, a total of 113,450 shares were issued to repay the principal, 50 shares were issued to cover interest of $10 and remaining interest of $1,565 was forgiven. In the case of the $25,000 note, the accrued interest of $2,310 was forgiven.

The Company analyzed the conversion option for beneficial conversion features consideration under ASC 470-20

“Convertible Securities with Beneficial Conversion Features” and noted none.

The Company also analyzed the conversion option for derivative accounting under ASC 815-15 “Derivatives and Hedging” and determined that the embedded conversion feature should be classified as a liability due to there being no explicit limit to the number of shares to be delivered upon settlement of the above conversion options.

The embedded conversion feature was measured at fair value at the date of inception and at the end of each reporting period or termination of the instrument with the change in fair value recorded to earnings. Since the Company’s common stock has had a limited trading market during the period trading commenced on July 15, 2014 to December 31, 2014 and, in addition, the Company has nominal assets and no revenue to date, the Company determined the stock is worth nil. As a result, the derivative liability is valued at zero.

NOTE 5 – LOAN PAYABLE

On June 18, 2015, the Company accepted a non-interest bearing loan of $100,000, payable on demand from a third party who is a business acquaintance of the CEO.

NOTE 6 – STOCK BASED COMPENSATION

On September 15, 2014, we issued 150,000 shares of our restricted common stock at $0.20 per share in exchange for services valued at $30,000 for website management and hosting and social media activities for one year commencing on September 15, 2014.

On May 6, 2015, under the terms of the Consulting Agreement with CGPM, LLC (“CGPM”), attached as Exhibit 10.8 to the Form 8-K filed on June 5, 2015, we issued 4,500,000 shares to CGPM for services rendered. Stock based compensation of $409,950 was recognized for the fair value of the 4,500,000 shares issued, based on the stock price on the agreement date.

On June 9, 2015, we issued 50,000 shares to David Lopez, Esq. in exchange for a general release. Stock based compensation of $3,000 was recognized for the fair value of the 50,000 shares issued, based on the stock price on the agreement date.

On June 19, 2015, under the terms of their Executive Employment Agreements, attached as Exhibits 10.9 and 10.10, respectively, to the Form 8-K filed by the company on June 15, 2015, we issued 10,000,000 shares to each of the CEO and COO who were appointed on June 19, 2015. A total of $1,390,000 stock based compensation expense was recognized for the fair value of the 20,000,000 share issued, based on the stock price on the agreement date.

On June 19, 2015, under the terms of the Consulting Agreement between the Company and CGPM, attached as Exhibit 10.8 to the Form 8-K filed by the company on June 5, 2015, we issued 8,000,000 shares to CGPM, LLC for services rendered. Stock based compensation of $556,000 was recognized for the fair value of the 8,000,000 shares issued, based on the stock price on the service completion date.

On June 19, 2015, we issued 40,000,000 shares to Champion Toronto in partial payment of $200,000 for services rendered under the Services Agreement in place between the Company and Champion Toronto. The fair value of the 40,000,000 shares issued was determined to be $2,780,000 based on the stock price on the conversion date, resulting in $2,580,000 loss on settlement of related party accounts payable.

NOTE 7 – INCOME TAXES

The Company uses the liability method, where deferred tax and liabilities are determined based on the expected future tax consequences of temporary differences between the carrying amounts of assets and liabilities for financial and income tax reporting purposes.

For the years ended December 31, 2014 and 2015, the Company incurred net losses, and, therefore, had no tax liability. The net deferred asset generated by the loss carry forward has been fully reserved. The cumulative net operating loss carry forward is $968,078 as of December 31, 2015 and will expire in year 2033.

Deferred tax assets consist of the tax effect of NOL carry-forwards. The Company has provided a full valuation allowance on the deferred tax assets because of the uncertainty regarding its realizability.

As of December 31, 2015 and 2014, deferred tax assets consisted of the following:



	December 31, 2015		December 31, 2014
Net operating loss carry forward	$	329,147	151,966
Valuation allowance		(329,147)	(151,966)
Net deferred tax asset	$	0	0

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