Bitech Technologies Corp - Quarter Report: 2010 June (Form 10-Q)

Unassociated Document

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x Annual report under Section 13 or 15(d) of the Securities Exchange Act of 1934

For the fiscal year ended June 30, 2010.

o Transition report under Section 13 or 15(d) of the Securities Exchange Act of 1934 (No fee required)

For the transition period from _______ to _______.

Commission file number: 000-27407

SPINE PAIN MANAGEMENT, INC.

(Formerly “VERSA CARD, INC.”)

(Name of Registrant in Its Charter)

Delaware	98-0187705
(State or Other Jurisdiction of	(I.R.S. Employer
Incorporation or Organization)	Identification No.)

5225 Katy Freeway

Suite 600

Houston, Texas 77007

(Address of Principal Executive Offices)

(713) 521-4220

(Issuer's Telephone Number, Including Area Code)

Securities registered under Section 12(g) of the Exchange Act:

Title of Each Class

Common Stock ($0.001 Par Value)

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 x No ¨

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See 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 ¨ 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

As of August 11, 2010, the registrant had 17,603,396 shares of common stock, $0.001 par value (the only class of voting stock), issued and outstanding.

SPINE PAIN MANAGEMENT, INC.

(Formerly “VERSA CARD, INC.”)

FORM 10-Q

TABLE OF CONTENTS

PART I	FINANCIAL INFORMATION

Item 1.	Financial Statements

	Balance Sheets as of June 30, 2010 (Unaudited) and December 31, 2009	3

	Statements of Operations for the three and six months ended June 30, 2010 and 2009 (Unaudited)	4

	Statements of Cash Flows for the six months ended June30, 2010 and 2009 (Unaudited)	5

	Notes to Financial Statements (Unaudited)	6

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	16

Item 4.	Controls and Procedures	18

PART II	OTHER INFORMATION

Item 1.	Legal Proceedings	18

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	20

Item 3.	Defaults Upon Senior Securities	20

Item 6.	Exhibits	21

	Signatures	23

SPINE PAIN MANAGEMENT, INC. (FORMERLY "VERSA CARD, INC.")

BALANCE SHEETS

	June 30,			December 31,
ASSETS	2010			2009
	(Unaudited)
CURRENT ASSETS:
Cash	$	13,639		$	32,789
Account receivable, net		1,988,507			508,499
Total current assets		2,002,146			541,288

TOTAL ASSETS	$	2,002,146		$	541,288

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES
Accounts payable and accrued liabilities	$	859,237		$	475,138
Notes payable		11,317			11,317
Due to former officers and directors		56,016			56,016
Due to related party		310,699			269,295
Total current liabilities		1,237,269			811,766

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY (DEFICIT)
Common stock: $0.001 par value, 50,000,000 shares
authorized; 17,403,396 and 16,867,682 shares issued and outstanding
at June 30, 2010 and December 31, 2009, respectively and 50,000 issuable at June 30, 2010.		17,453			16,868
Additional paid-in capital		15,126,767			14,717,352
Accumulated deficit		(14,379,343	)		(15,004,698	)

Total stockholders’ equity (deficit)		764,877			(270,478	)

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)	$	2,002,146		$	541,288

See accompanying notes to the condensed financial statements

SPINE PAIN MANAGEMENT, INC. (FORMERLY "VERSA CARD, INC.")

UNAUDITED STATEMENTS OF OPERATIONS

	FOR THE THREE MONTHS ENDED JUNE 30,					FOR THE SIX MONTHS ENDED JUNE 30,
	2010		2009			2010		2009

REVENUE	$	1,732,126	$	-		$	3,184,259	$	-

COST OF SALES
Service costs		368,400		-			687,100		-

GROSS PROFIT		1,363,726		-			2,497,159		-

OPERATING EXPENSES
General and administrative expenses	$	297,738		394,029			382,178		1,050,903
Bad and Doubtful Debts expense		799,246		-			1,494,616		-

Total Operating Expenses		1,096,984		394,029			1,876,794		1,050,903

NET INCOME (LOSS) FROM OPERATIONS		266,742		(394,029	)		620,365		(1,050,903	)

Other income		3,490		-			4,990		-

NET INCOME (LOSS)	$	270,232	$	(394,029	)	$	625,355	$	(1,050,903	)

NET INCOME (LOSS) PER SHARE:
Basic and Diluted	$	0.02	$	(0.02	)	$	0.04	$	(0.07	)

WEIGHTED-AVERAGE SHARES:
Basic and Diluted		17,118,467		16,317,682			16,993,767		15,356,356

See accompanying notes to the condensed financial statements

SPINE PAIN MANAGEMENT, INC. (FORMERLY "VERSA CARD, INC.")

UNAUDITED STATEMENTS OF CASH FLOWS

	FOR THE SIX MONTHS ENDED JUNE 30,
	2010			2009
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	625,355		$	(1,050,903	)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Bad and Doubtful Debts expense		1,494,616			-
Issuance of common stock towards payable to NSO (see Note 7)		200,000			-
Issuance of common stock for consulting services and stock based compensation		210,000			544,000
Issuance of common stock towards acquisition of intangible assets		-			225,000
Changes in assets and liabilities:
Accounts receivable		(2,974,625	)		-
Accounts payable and accrued liabilities		384,100			118,182
Due to related parties		41,404			163,721
Net cash used in operating activities		(19,150	)		-

CASH FLOWS FROM INVESTING ACTIVITIES:
Net cash provided by (used in) investing activities		-			-

CASH FLOWS FROM FINANCING ACTIVITIES:
Net cash provided by (used in) financing activities		-			-
NET DECREASE IN CASH AND CASH EQUIVALENTS		(19,150	)		-

BEGINNING OF PERIOD		32,789			-
END OF PERIOD	$	13,639		$	-

Supplementary disclosure of cash flow information:
Cash paid for interest	$	-		$	-
Cash paid for income taxes	$	-		$	-

Supplementary disclosure of non-cash investing and financing activities:
Issuance of common stock towards payable to NSO	$	200,000		$	-
Issuance of common stock towards consulting services and stock based compensation	$	210,000		$	-

Acquisition of intangible assets	$	-		$	(225,000	)
Issuance of common stock towards acquisition of intangible assets		-			225,000
	$	-		$	-

See accompanying notes to the condensed financial statements

PART I

SPINE PAIN MANAGEMENT, INC., (Formerly “Versa Card, Inc.”)

NOTES TO THE FINANCIAL STATEMENTS (Unaudited)

NOTE 1. DESCRIPTION OF BUSINESS

Spine Pain Management, Inc., formerly known as Versa Card, Inc., Intrepid Global Imaging 3D, Inc., MangaPets, Inc. and Newmark Ventures, Inc. (the “Company”), was incorporated in Delaware on March 4, 1998 to acquire interests in various business operations and assist in their development. On November 12, 2009, the Company changed its name from Versa Card, Inc. to Spine Pain Management, Inc. The Company commenced commercial operations in August, 2009 and is no longer considered a development stage company.

Since inception, the Company had engaged in and contemplated several ventures and acquisitions, many of which were not consummated. In April 2005, the Company began focusing on the development of the “MangaPets” interactive web portal and acquiring other ventures in the technology sector. The Company entered into a Portal Development Agreement in July 2005, with Sygenics Interactive Inc. (“Sygenics”), a developer of advanced information management technology, located in Montreal, Quebec, Canada, and an authorized licensee of Sygenics Inc. The agreement provided for the design, development and deployment of an online virtual pet portal/website. However, in 2006, prior to Sygenics’ completion of the first stage of the portal, a dispute arose between the Company and Sygenics that resulted in work being halted. Since that time, the Company has attempted to develop the web portal or form another strategic relationship with a different developer to complete development of the web portal. The Company has reevaluated MangaPet's business of developing a web portal containing games, merchandizing, and other entertainment activities to determine the viability of that business concept. It has been determined that this business segment is no longer appropriate to pursue given the Company’s current business plan.

During 2006, in addition to developing the Manga themed web portal, the Company expended resources toward establishing a United Kingdom based subsidiary company to pursue acquisitions in the gaming sector. On the advice of counsel, and unfavorable events in the United States pertaining to on-line gaming, the Company decided not to pursue on-line gaming ventures.

Commencing in the fourth quarter of 2007, the Company focused on consummating a transaction with a smartcard / e-purse company, First Versatile Smartcard Solutions Corporation (“FVS”), and put on hold the development of its web portal for the Company’s MangaPets business. In November 2007, the Company entered into an agreement to merge with FVS, and subsequently in April 2008, the transaction was restructured as a stock purchase agreement. Based on various factors, the acquisition of FVS did not meet the expectations of the Company or FVS, and on December 30, 2008 the Company entered into a Mutual Release and Settlement Agreement to effectively rescind the transactions effected by the FVS acquisition agreements.

At the end of December 2008, the Company began moving forward to launch its new business concept of delivering turnkey solutions to spine surgeons, orthopedic surgeons and other healthcare providers for necessary and appropriate treatment of musculo-skeletal spine injuries. In connection with this business plan, in February, 2009, the Company acquired the website and propriety methodologies of One Source Plaintiff Funding, Inc. (“One Source”), a Florida corporation, which the Company planned to use in the business of “lawsuit funding”. Based on several factors, however, the Company decided in July 2009 not to enter the business of lawsuit funding (as described in more detail below in Note 2, “Change in Business”), and focus solely on assisting healthcare providers in providing necessary and appropriate treatment for patients with spine injuries.

In August 2009, the Company opened its first spine injury treatment center in Houston, Texas. On June 19, 2010, the Company opened a new Spine Diagnostic Center in McAllen, Texas. This new center facilitates medical spine injection procedures to patients from the lower Rio Grand Valley, including the cities of Harlingen, Brownsville and Edinburg, Texas. Like the Company’s Houston facility, the McAllen center uses a fellowship trained pain doctor to provide spine diagnostic injections, with assistance from Emergency Medical Transit and specialized radiological personnel. The Company is also currently evaluating the development of additional spine injury treatment centers in Texas and across the United States.

Spine Pain Management is a medical marketing, management and billing and collection company facilitating treatment for patients who have sustained spine injuries resulting from automobile and work-related accidents. The Company’s mission is to deliver turnkey solutions to spine surgeons, orthopedic surgeons and other health care providers for necessary and appropriate treatment for spine related injuries. The goal of the Company is to become a leader in providing care management services to spine surgeons and orthopedic surgeons to facilitate proper treatment of their injured clients. By providing early treatment, the Company believes that spine injuries can be managed, and injured victims can be quickly placed on the road to recovery. The Company believes its advocacy will be rewarding to patients who obtain needed relief from painful conditions. The Company provides a care management program that advocates for the injured victims by moving treatment forward to conclusion without the delay and hindrance of the legal process.

GOING CONCERN

The Company has a history of recurring losses from operations and has an accumulated deficit of approximately $14.4 million as of June 30, 2010. Successful business operations and its transition to attaining profitability are dependent upon obtaining additional financing and achieving a level of revenue adequate to support its cost structure. Considering the nature of the business, the Company is not generating immediate liquidity and sufficient working capital within a reasonable period of time to fund its planned operations and strategic business plan through December 31, 2010; therefore, it is actively seeking additional debt or equity financing. There can be no assurances that there will be adequate financing available to the Company. The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. This basis of accounting contemplates the recovery of the Company’s assets and the satisfaction of liabilities in the normal course of business. The financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the outcome of this uncertainty.

NOTE 2. CHANGE IN BUSINESS

At the end of 2008, the Company launched its new business concept of spine pain management. The Company’s goal is to engage in the delivery of turnkey solutions to spine surgeons, orthopedic surgeons and other healthcare providers for necessary and appropriate treatment of musculo-skeletal spine injuries. With the new business plan, the Company has reevaluated MangaPet's business of developing a web portal containing games, merchandizing, and other entertainment activities to determine the viability of that business concept. It has been determined that this business segment is no longer appropriate to pursue given the Company’s current business plan.

On February 28, 2009, in connection with the launch of its new spine pain injury treatment business segment, the Company entered into an agreement with Brian Koslow and David Waltzer to acquire the website and proprietary methodologies of One Source Plaintiff Funding, Inc., a Florida corporation (“One Source”). The agreement provided for the Company to acquire the website and proprietary methodologies of One Source in exchange for 900,000 shares of the Company’s common stock. One Source’s website and proprietary methodologies were designed for the business of "lawsuit funding" for plaintiff personal injury cases. In connection with the One Source transaction, the Company entered into employment agreements with Mr. Koslow and Mr. Waltzer, the founders of One Source, with Mr. Koslow being appointed as Executive Vice President of Business Development of the Company. With the assistance of Messrs. Koslow and Waltzer, the Company planned to further develop One Source’s website and proprietary methodologies so that the Company could enter the business of lawsuit funding. In July 2009, however, Mr. Koslow and Mr. Waltzer unexpectedly resigned from the Company. With the resignations of Messrs. Koslow and Waltzer, the Company realized it would be unable to use the proprietary methodology of One Source and has decided not to enter the business of lawsuit funding, focusing instead on its spine pain injury treatment business. Accordingly, the Company will have no use for the website and proprietary methodologies of One Source. Upon an evaluation of the expected life of the acquired One Source assets in the amount of approximately $231,000, it was decided at December 31, 2009 that these assets had no value, and the acquired cost of the impaired assets have been written off and recorded in the Company’s statement of operations for the year ended December 31, 2009. The Company also filed a lawsuit against Messrs. Koslow and Waltzer, which was recently resolved through a settlement agreement, as described in Note 12, “Commitments and Contingencies.”

On Nov. 12, 2009 the Company changed its name from "Versa Card, Inc." to "Spine Pain Management, Inc." and has changed its trading symbol from "IGLB" to "SPIN." The name change was effected legally with the Delaware Secretary of State on November 12, 2009 and was effected in the market on November 27, 2009. OTC Bulletin Board: SPIN.

NOTE 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The following are summarized accounting policies considered to be significant by the Company’s management:

Basis of Presentation

The accompanying unaudited condensed financial statements of Spine Pain Management, Inc. (the "Company") have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC). Certain information and footnote disclosures, normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such SEC rules and regulations. Nevertheless, the Company believes that the disclosures are adequate to make the information presented not misleading. These interim condensed financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company's 2009 Annual Report as filed on Form 10K. In the opinion of management, all adjustments, including normal recurring adjustments necessary to present fairly the financial position of the Company with respect to the interim financial statements and the results of its operations for the interim period ended June 30, 2010, have been included. The results of operations for interim periods are not necessarily indicative of the results for a full year.

Accounting Method

The Company’s financial statements are prepared using the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America and have been consistently applied in the preparation of the financial statements.

Change from Development Stage

Pursuant to FASB ASC 915, “Development Stage Entities”, the Company was considered to be a development stage entity from March 4, 1998 to December 31, 2008. Among other provisions, FASB ASC 915 stipulates the reporting of inception to date results of operations, cash flows and other financial information. Since August 2009, the Company began generating revenues from planned commercial operations. Although the Company’s management expects to focus a significant amount of resources to business development and expansion type activities over the next 2 to 3 years, the Company has been generating revenues that originate from planned principle operations relative to new business concept of spine pain management. Consequently, these financial statements are reported in accordance with accounting principles for an operating company and do not reflect inception to date information.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities known to exist as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Uncertainties with respect to such estimates and assumptions are inherent in the preparation of the Company’s financial statements; accordingly, it is possible that the actual results could differ from these estimates and assumptions and could have a material effect on the reported amounts of the Company’s financial position and results of operations.

Revenue Recognition

Revenues are recognized in accordance with SEC staff accounting bulletin, Topic 13, Revenue Recognition, which specifies that only when persuasive evidence for an arrangement exists; the fee is fixed or determinable; and collection is reasonably assured can revenue be recognized.

Persuasive evidence of an arrangement is obtained prior to services being rendered when the patient completes and signs the medical and financial paperwork. Delivery of services is considered to have occurred when treatment(s) are provided to the patient. The price and terms for the services are considered fixed and determinable at the time that the treatments are provided and are based upon the type and extent of the services rendered. The Company’s credit policy has been established based upon extensive experience by management in the industry and has been determined to ensure that collectability is reasonably assured. Payment for services are primarily made to the Company by a third party. Due to the Company’s relatively recent entry into this area of operations, collection is averaging over 220 days. However, management believes that the number of days outstanding on the collections will be reduced in the near future.

The Company maintains an allowance for doubtful accounts based on nature of its business, collection trends, current economic conditions, the composition of its accounts receivable aging, and the assessment of probable loss related to uncollectible accounts receivable. The Company recorded an allowance towards doubtful accounts in the amount of approximately $1,627,000 and $442,000 at June 30, 2010 and December 31, 2009, respectively.

Bad and doubtful debts expense is presented net of bad debt recoveries in the accompanying statements of operations.

Income Taxes

The Company accounts for income taxes in accordance with the liability method. Under the liability method, deferred assets and liabilities are recognized based upon anticipated future tax consequences attributable to differences between financial statement carrying amounts of assets and liabilities and their respective tax bases. The Company establishes a valuation allowance to the extent that it is more likely than not that deferred tax assets will not be utilized against future taxable income.

Uncertain tax positions

In July 2006, the Financial Accounting Standards Board (“FASB”) issued guidance codified in Accounting Standards Codification (“ASC”) Topic 740-10-25 “Accounting for Uncertainty in Income Taxes”. ASC Topic 740-10-25 supersedes guidance codified in ASC Topic 450, “Accounting for Contingencies”, as it relates to income tax liabilities and lowers the minimum threshold a tax position is required to meet before being recognized in the financial statements from “probable” to “more likely than not” (i.e., a likelihood of occurrence greater than fifty percent). Under ASC Topic 740-10-25, the recognition threshold is met when an entity concludes that a tax position, based solely on its technical merits, is more likely than not to be sustained upon examination by the relevant taxing authority. Those tax positions failing to qualify for initial recognition are recognized in the first interim period in which they meet the more likely than not standard, or are resolved through negotiation or litigation with the taxing authority, or upon expiration of the statute of limitations. De-recognition of a tax position that was previously recognized occurs when an entity subsequently determines that a tax position no longer meets the more likely than not threshold of being sustained.

The Company is subject to ongoing tax exposures, examinations and assessments in various jurisdictions. Accordingly, the Company may incur additional tax expense based upon the outcomes of such matters. In addition, when applicable, the Company will adjust tax expense to reflect the Company’s ongoing assessments of such matters which require judgment and can materially increase or decrease its effective rate as well as impact operating results.

Under ASC Topic 740-10-25, only the portion of the liability that is expected to be paid within one year is classified as a current liability. As a result, liabilities expected to be resolved without the payment of cash (e.g. resolution due to the expiration of the statute of limitations) or are not expected to be paid within one year are not classified as current. The Company has recently adopted a policy of recording estimated interest and penalties as income tax expense and tax credits as a reduction in income tax expense.

The Company did not file federal and applicable state income tax returns for the years ended December 31, 2009, 2008 and 2007, respectively. Although the Company has incurred losses since its inception, the Company is obligated to file income tax returns for compliance with IRS regulations and that of applicable state jurisdictions. The Company anticipates filing tax returns for the years ended December 31, 2009, 2008 and 2007 within 30 days of this report. Management believes that the Company will not incur significant penalty and interest for non-filing of federal and state income tax returns, as well as, federal and state income tax liabilities, as applicable, for the years ended December 31, 2009, 2008 and 2007, respectively, considering its loss making history since inception. The Company is still in the process of determining the amount of net taxable operating losses eligible to be carried forward for federal and applicable state income tax purposes for the years ended December 31, 2009, 2008 and 2007, respectively. The Company has not made any provision for federal and state income tax liabilities that may result from this uncertainty as of December 31, 2009 and 2008, respectively.

Although the Company has net income from operations of $625,355 for the six months ended June 30, 2010, management believes that no provision for federal and state income taxes is considered necessary for the six months ended June 30, 2010 as the company has a benefit of significant net operating losses carried forward from prior years. Management also determined that any amounts payable in the form of federal and state income tax liabilities including resultant penalties and interest, will not have a material impact on the Company’s financial position, its results of operations and its cash flows.

The number of years with open tax audits varies depending on the tax jurisdiction. The Company’s major taxing jurisdictions include the United States (including applicable states).

Reclassification - Certain prior period amounts have been reclassified to conform to current period presentations.

Accounting Standard Updates

In October 2009, the FASB has published Accounting Standard Updates (“ASU”) No. 2009-13, “Revenue Recognition (Topic 605)-Multiple Deliverable Revenue Arrangements,” which addresses the accounting for multiple-deliverable arrangements to enable vendors to account for products or services (deliverables) separately rather than as a combined unit. Specifically, this guidance amends the criteria in Subtopic 605-25, “Revenue Recognition-Multiple-Element Arrangements,” for separating consideration in multiple-deliverable arrangements. This guidance establishes a selling price hierarchy for determining the selling price of a deliverable, which is based on: (a) vendor-specific objective evidence; (b) third-party evidence; or (c) estimates. This guidance also eliminates the residual method of allocation and requires that arrangement consideration be allocated at the inception of the arrangement to all deliverables using the relative selling price method and also requires expanded disclosures. The guidance in this update is effective prospectively for revenue arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on the Company’s financial position and results of operations.

In April 2010, the FASB issued Accounting Standard Update No. 2010-12. “Income Taxes” (Topic 740). ASU No.2010-12 amends FASB Accounting Standard Codification subtopic 740-10 Income Taxes to include paragraph 740-10-S99-4. FASB Codification topic 740, Income Taxes, requires the measurement of current and deferred tax liabilities and assets to be based on provisions of enacted tax law. The effects of future changes in tax laws are not anticipated. Therefore, the different enactment dates of the Act and reconciliation measure may affect registrants with a period-end that falls between March 23, 2010 (enactment date of the Act), and March 30, 2010 (enactment date of the reconciliation measure). However, the announcement states that the SEC would not object if such registrants were to account for the enactment of both the Act and the reconciliation measure in a period ending on or after March 23, 2010, but notes that the SEC staff “does not believe that it would be appropriate for registrants to analogize to this view in any other fact patterns.” The adoption of this guidance is not expected to have a material impact on the Company’s consolidated financial statements.

In April 2010, the FASB issued Accounting Standard Update No. 2010-17. “Revenue Recognition-Milestone Method” (Topic 605) ASU No.2010-17 provides guidance on defining a milestone and determining when it may be appropriate to apply the milestone method of revenue recognition for research or development transactions. An entity often recognizes these milestone payments as revenue in their entirety upon achieving a specific result from the research or development efforts. A vendor can recognize consideration that is contingent upon achievement of a milestone in its entirety as revenue in the period in which the milestone is achieved only if the milestone meets all criteria to be considered substantive. Determining whether a milestone is substantive is a matter of judgment made at the inception of the arrangement. The ASU is effective for fiscal years and interim periods within those fiscal years beginning on or after June 15, 2010. Early application is permitted. Entities can apply this guidance prospectively to milestones achieved after adoption. However, retrospective application to all prior periods is also permitted. The adoption of this guidance is not expected to have a material impact on the Company’s consolidated financial statements.

Other ASUs that are effective after June 30, 2010, are not expected to have a significant effect on the Company’s financial position or results of operations.

NOTE 4. NOTES PAYABLE

Notes payable consist of the following:

	June 30,		December 31,
	2010		2009

Note payable to an individual	$	9,334	$	9,334
Note payable to a company		1,983		1,983
Total	$	11,317	$	11,317

The aforesaid notes are secured by all assets of the Company, due on demand and do not follow any specific repayment schedule. These notes have been placed on non-interest accrual status effective January 1, 2010 as amount due under these notes have not been claimed by third parties for a considerable period of time.

NOTE 5. DUE TO FORMER OFFICERS AND DIRECTORS

Due to former related parties consist of:

	June 30,		December 31,
	2010		2009

Due to former chief executive officer	$	4,237	$	4,237
Due to former chief accounting officer		51,779		51,779
Total	$	56,016	$	56,016

Amounts due to former related parties are unsecured, non-interest bearing, due on demand and do not follow any specific repayment terms.

NOTE 6. DUE TO RELATED PARTIES

Due to related parties consists of:

	June 30,		December 31,
	2010		2009

Due to chief executive officer	$	310,699	$	269,295
Total	$	310,699	$	269,295

Amounts due to Chief Executive Officer are unsecured, non-interest bearing, due on demand and do not follow any specific repayment terms. The Company used the amount financed for meeting with its working capital requirements.

NOTE 7. RELATED PARTY TRANSACTIONS

Medical Services Agreement

In August 2009, the Company entered into a medical services agreement (the “Agreement”) with Northshore Orthopedics, Assoc. ("NSO") to open its first spine injury treatment center in Houston, Texas. Pursuant to the terms of the Agreement, NSO will operate as an independent contractor for the Company to provide medical diagnostic services for evaluation and treatment of patients with spine injuries at pre-determined and pre-negotiated rate per patient. NSO will be deemed for all purposes an independent contractor and not an employee, agent, joint venturer or partner of the Company. NSO will be responsible for its own taxes associated with its performance of the services and receipt of payments pursuant to this Agreement. The Agreement has a term of three years, and thereafter will automatically renew for another three years at the discretion of involved parties. During 2010, the Company incurred $640,900 towards NSO’s costs which is included as cost of sales in the accompanying statement of operations. As of June 30, 2010, the Company had a balance of $440,900 payable towards NSO’s costs for providing medical diagnostic services relative to spine injuries which is included as accounts payable and accrued liabilities in the accompanying balance sheets. On May 25, 2010, the Company issued 285,714 shares of common stock valued at $0.70 per share totaling approximately $200,000 towards partial payment of amounts due to NSO. NSO is owned by Dr. William Donovan, Chief Executive Officer of the Company.

In-kind Contributions

Since August, 2009, the Company maintains its office at: 5225 Katy Freeway, Suite 600, Houston, Texas 77007. This office space encompasses approximately 450 square feet and is currently provided to the Company at no cost by Dr. William Donovan, the Company’s Director and Chief Executive Officer. As a result, the Company has recognized in-kind contributions of $3,000 as other income and related rental expense of $3,000 as general and administration expenses in the accompanying statement of operations for the six months ended June 30, 2010 (none in June 30, 2009).

NOTE 8. COMMON STOCK

Stock Issuances

In February, 2009, the Company issued 2,100,000 shares of Company common stock to various individuals, including certain directors, officers and stockholders, for services and compensation valued at approximately $544,000.

Pursuant to a Stock Exchange Agreement dated February, 2009, the Company acquired the website and proprietary methodologies of One Source Plaintiff Funding, Inc. in exchange for 900,000 shares of its common stock valued at $225,000.

On December 28, 2009, the Company issued 500,000 restricted shares of common stock to William Donovan, M.D., the Company’s Chief Executive Officer, for the conversion of $349,400 of outstanding debt owed by the Company to Dr. Donovan.

On May 11, 2010, The Company approved and authorized the issuance to John Talamas 50,000 shares of common stock at $0.70 per share valued at $35,000, towards his services as the Chief Operating Officer.

On May 13, 2010, the Company issued 250,000 restricted shares of common stock to Richard Specht, a Director of the Company, at $0.70 per share valued at $175,000 as consideration for serving on the Board of Directors.

On May 25, 2010, the Company issued 285,714 restricted shares of common stock to William Donovan, M.D., the Company’s Chief Executive Officer, for the conversion of $200,000 of outstanding amounts owed by the Company to NSO (see Note 7).

NOTE 9. INCOME TAXES

The Company has not made provision for income taxes for the six-month period ended June 30, 2010 and in the years ended December 31, 2009 and 2008, respectively, since the Company has incurred net operating losses in these periods.

Deferred income tax assets consist of:

	June 30, 2010			December 31, 2009
Net operating loss carryforwards	$	2,431,700		$	2,675,400
Less valuation allowance	$	(2,431,700	)	$	(2,675,400	)
Deferred income tax assets, net	$	-		$	-

Due to uncertainties surrounding the Company’s ability to generate future taxable income to realize these assets, a full valuation has been established to offset the net deferred income tax asset. Based on management’s assessment, utilizing an effective combined tax rate for federal and state taxes of approximately 39%, the Company has determined it to be more likely than not that a deferred income tax asset of approximately $2,431,700 and $2,675,400 attributable to the future utilization of the approximately $6,235,000 and $6,860,000 in eligible net operating loss carryforwards as of June 30, 2010 and December 31, 2009, respectively, will not be realized. The Company will continue to review this valuation allowance and make adjustments as appropriate. The net operating loss carryforwards will begin to expire in varying amounts from year 2018 to 2029.

Current income tax laws limit the amount of loss available to be offset against future taxable income when a substantial change in ownership occurs. Therefore, amounts available to offset future taxable income may be limited.

As the Company has not filed federal and applicable state income tax returns for the years ended December 31, 2009, 2008 and 2007, respectively, it is not practicable to determine amounts of interest and/or penalties related to income tax matters that will be due as of December 31, 2009 and 2008, respectively. Accordingly, the Company had no accrual for interest or penalties on the Company’s balance sheets at December 31, 2009 and 2008, respectively, and has not recognized interest and/or penalties in the accompanying statements of operations for the years ended December 31, 2009 and 2008, respectively. However, management of the Company believes that non-filing of federal and applicable state income tax returns will not have a significant impact on the Company’s financial position, its results of operations and cash flows considering continued operating losses since inception.

The Company is subject to taxation in the United States and certain state jurisdictions. The Company’s tax years for 2002 and forward are subject to examination by the United States and applicable state tax authorities due to the carry forward of unutilized net operating losses.

NOTE 10. COMMITMENTS AND CONTINGENCIES

On June 22, 2010, the Company filed a lawsuit against HSC Holdings, LLC (“HSC”) and Ilona Alexis Mandelbaum. The Company had previously executed certain consulting agreements with HSC providing for the Company to engage HSC as a consultant to provide certain business services. In the lawsuit, the Company alleges that (a) defendants made certain material misrepresentations to the Company, thereby fraudulently inducing the Company to enter into the consulting agreements, and (b) in the alternative, the defendants breached the consulting agreements. The Company also seeks a declaratory judgment from the Court regarding certain communications the Company had with the defendants for a mutually agreed upon resolution of this dispute. The defendants have not yet filed an answer to the Company’s complaint. The case is still pending in District Court. The Company strongly believes the facts support its case against the defendants. There can be no assurance, however, that the outcome of this case will be favorable to the Company.

On January 19, 2010, James McKay and Celebrity Foods, Inc. (“CFI”) filed a lawsuit against the Company and Dr. William Donovan, M.D., individually, in the United States District Court, Eastern District of Pennsylvania. Based on the lawsuit, in March 2009, Plaintiffs contacted the Company’s transfer agent to have restrictive legends removed on shares the plaintiffs had previously obtained from the Company in connection with a stock purchase agreement. The Company subsequently requested that the transfer agent place a stop transfer order on the shares. Plaintiffs allege the Company’s actions constitute a breach of contract, fraud and/or unjust enrichment. They are seeking monetary and punitive damages, attorneys’ fees and costs, as well as a divestment of all shares and a rescission of the stock purchase agreement. The Company filed a motion to dismiss on April 16, 2010. The case is still pending in District Court. We believe the case is without merit and are vigorously fighting the lawsuit. There can be, however, no assurance that the outcome of this case will be favorable to the Company.

In November 2009, the Company filed a lawsuit against Brian Koslow and David Waltzer in Harris County District Court. The lawsuit was removed to the District Court for the Southern District of Texas. The lawsuit relates to the transactions the Company entered into with Messrs. Koslow and Waltzer to acquire the website and proprietary methodologies of One Source Plaintiff Funding, Inc. In the suit, the Company alleges that Messrs. Koslow and Waltzer (a) breached an agreement to rescind the One Source acquisition, (b) made fraudulent representations to the Company to induce them to enter into the One Source acquisition, (c) will be unjustly enriched if the One Source acquisition is not rescinded, and (d) breached a fiduciary duty owed to the Company. Messrs. Koslow and Waltzer answered the Original Petition and asserted counterclaims against the Company for breach of contract and fraud. The parties mediated the lawsuit on April 16, 2010. During the mediation, the parties entered into a preliminary hand-written agreement for settlement of the lawsuit. In August 2010, the parties entered into a definitive settlement agreement. This agreement provides that (1) the Company will transfer to Messrs. Koslow and Waltzer the 1,000 shares of common stock of One Source Plaintiff Funding, Inc. and an aggregate of 200,000 options to purchase common stock of the Company at an exercise price of $1.00 per share for a term of three years, (2) Messrs Koslow and Waltzer will transfer to the Company an aggregate of 625,000 shares of common stock of the Company (thereby Messrs Koslow and Waltzer will retain an aggregate of 375,000 shares of common stock), (3) Messrs. Koslow and Waltzer will enter into a Lock Up/Leak Out Agreement whereby they can sell no more than an aggregate of 11,250 shares of common stock of the Company during any calendar month, and (4) all parties to the lawsuit will mutually release each other from all claims of liability. The Company anticipates filing the settlement agreement with the Court to have the case dismissed, as soon as possible.

On October 27, 2009, William R. Dunavant and William R. Dunavant Family Holdings, Inc. filed suit in the 55th Judicial District Court of Harris County, Texas, against the Company, William Donovan, M.D., Richard Specht, Rene Hamouth and Signature Stock Transfer, Inc. Plaintiffs claim that the Company issued 2,000,000 shares of stock as compensation for work performed on behalf of the Company. On December 31, 2008, and again in early 2009, Plaintiffs sold some of their shares. However, on February 10, 2009, the Company issued a stop transfer resolution preventing Plaintiffs from selling any of the remaining shares. Plaintiffs claim the following causes of action: 1) breach of contract, stating that Defendants agreed to compensate Plaintiffs by tendering 2,000,000 shares of stock free and clear; 2) conversion, claiming Defendants wrongfully and without authority converted the common stock owned by Plaintiffs; 3) fraud and fraudulent inducement, claiming Defendants’ conduct constitutes legal fraud and deceit; 4) breach of fiduciary duty, claiming Defendants had a fiduciary relationship with Plaintiffs and owed them the utmost duty of good faith, fair dealing, loyalty and candor; 5) intentional Infliction of emotional distress, claiming Defendants’ conduct was extreme, outrageous, deliberate and intentional; 6) unjust enrichment, claiming that Defendants had no right to prevent Plaintiffs from selling the stock; and 7) declaratory judgment, seeking the Court to declare the common stock was proper and authorized. Plaintiffs seek exemplary and punitive damages, as well as attorney fees. The case is currently scheduled to go to trial in January 2011. We believe the case is without merit and are vigorously fighting the lawsuit. There can be no assurance, however, that the outcome of this case will be favorable to the Company.

In March 2008, Kent Carasquero, Leslie Lounsbury, Riverside Manitoba, Inc. and Tyeee Capital Consultants, Inc. filed suit against the Company, Richard Specht, Rene Hamouth, Hamouth Family Trust, William R. Dunavant, and William R. Dunavant Family Holdings, Inc. The suit was filed in The United States District Court, Middle District of Florida and requests damages and injunctive relief for various breaches of contract and securities violations. A default judgment was entered against the defendants on July 20, 2008. The default judgment was set aside and the case reopened on November 7, 2008. The Company believes all claims against it are without merit, and it will continue to vigorously defend itself against such claims. There is no assurance, however, that the matter can be settled on terms favorable to the Company.

NOTE 11. SUBSEQUENT EVENTS

On July 13, 2010, the Company held its 2009 Annual Shareholders' meeting at the Company's home office in Houston, Texas. At the meeting, the Company’s shareholders approved the appointment of an auditor for the Company, re-election of the current two Directors and election of three new members to the Board of Directors. The three new Directors are:

Jerry Bratton, J.D., MBA, age 57 - Mr. Bratton has served as President of Bratton Steel, L.P. since 2006 and previously with Bratton Steel, Inc. (its predecessor) since 1991. Bratton Steel is a structural steel fabricating company. As President, Mr. Bratton has grown the company from a startup to a company that employs up to approximately 75 employees. He has significant experience in overseeing sales, estimating, project management and contracting. Mr. Bratton served as President of the Texas Structure Steel Institute from 2007 to 2008. He is also a member of the American Institute of Steel Construction. Mr. Bratton has business and investment background in medical software, personal medical information records storage, RFID security products and energy ventures. Mr. Bratton is a licensed attorney in the State of Texas and previously served as an assistant general counsel in the construction industry. Mr. Bratton earned a Juris Doctorate and Master of Business Administration degree from Texas Tech University in 1977.

Franklin A. Rose, M.D., age 58 - Dr. Rose is a Board Certified plastic and reconstructive surgeon. He has been in private practice since 1984 and currently has hospital affiliations in Houston, Texas with First Street Surgical Center, Woman's Hospital of Texas, Memorial Hermann Hospital-Northwest and Twelve Oaks Hospital. Dr. Rose is an experienced surgeon, well acquainted with various surgical and medical procedures. He has also been involved in investing with multiple micro-cap medical companies. Dr. Rose earned a Doctor of Medicine degree from the University of Colorado in 1977, and a Bachelor of Science degree from the University of Wisconsin, Madison in 1973. He is a member of the American Medical Association, the American Society of Plastic Surgeons, the Lipolysis Society of North America and the American Society of North America. He is also the attending plastic surgeon to The Texas Institute of Plastic Surgery.

John Bergeron, CPA, age 53 - Mr. Bergeron currently serves as President of Jolpeg Inc., a private firm that consults on financial matters in service industries, a position he has held since May 2008. Also since May 2008, he has worked as Controller of Christian Brothers Automotive Corporation, of which he also currently owns and operates a franchise. From May 2005 until May 2008, Mr. Bergeron served as Divisional Controller of Able Manufacturing, a division of NCI Group, Inc, where his responsibilities included financial reporting, budgeting and Sarbanes-Oxley Act compliance. Prior to that, Mr. Bergeron worked as controller of different internet companies and as an accounting manager for several other private firms. He has also worked as an auditor for Arthur Andersen. Mr. Bergeron has more than thirty years' experience in financial management and corporate development of manufacturing and service industry companies. He has extensive experience in financial reporting of public companies, risk management, business process re-engineering, structuring and implementing accounting procedures and internal control programs for Sarbanes-Oxley Act compliance. Mr. Bergeron is a Certified Public Accountant. He received a Bachelor of Business Administration in Accounting from Lamar University in 1979. He is also currently the President of the Montgomery County MUD #83.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with our consolidated financial statements and the related notes to the financial statements included in this Form 10-Q.

FORWARD LOOKING STATEMENT AND INFORMATION

We are including the following cautionary statement in this Form 10-Q to make applicable and take advantage of the safe harbor provision of the Private Securities Litigation Reform Act of 1995 for any forward-looking statements made by us or on behalf of us. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance and underlying assumptions and other statements, which are other than statements of historical facts. Certain statements in this Form 10-Q are forward-looking statements. Words such as "expects," "believes," "anticipates," "may," and "estimates" and similar expressions are intended to identify forward-looking statements. Such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Such risks and uncertainties are set forth below. Our expectations, beliefs and projections are expressed in good faith and we believe that they have a reasonable basis, including without limitation, our examination of historical operating trends, data contained in our records and other data available from third parties. There can be no assurance that our expectations, beliefs or projections will result, be achieved, or be accomplished.

Management Overview

At the end of 2008, the Company launched its new business concept of delivering turnkey solutions to spine surgeons, orthopedic surgeons and other healthcare providers for necessary, reasonable and appropriate treatment for musculo-skeletal spine injuries. Moving forward, the Company’s main focus will be on the expansion and development of spine testing centers and/or business relationships with subcontractors owning such facilities as needed by spine surgeons, orthopedic surgeons and other healthcare providers across the nation.

Results of Operations

Comparison of the three month period ended June 30, 2010 with the three month period ended June 30, 2009.

The Company recorded approximately $1,732,000 in service revenues for the three months ended June 30, 2010 and no revenue in the same period in 2009. This increase is attributable to revenues generated from the Company’s spine injury treatment centers in Houston and McAllen, Texas. The centers were not open in the quarter ended June 30, 2009. During the three month period ended June 30, 2009, the Company’s operations were limited to initial planning of the Company’s spine injury treatment business, preparing for the opening of its first spine injury treatment center and satisfying continuous public disclosure requirements. The Company’s spine injury treatment center in Houston opened in August 2009, and its center in McAllen opened in June 2010.

Service cost was approximately $368,000 for the three months ended June 30, 2010 compared to none in the same period in 2009.

During the three months ended June 30, 2010, the Company incurred approximately $298,000 of general and administration expenses as compared to approximately $394,000 for the same period in 2009. Approximately $298,000 of general and administrative expenses incurred during the three months ended June 30, 2010 includes recurring general and administrative charges, as well as approximately $210,000 of stock based compensation recorded as general and administrative expenses.

The total operating expenses for the three months ended June 30, 2010 and 2009 were approximately $1,097,000 and $394,000, respectively, representing an increase of approximately $703,000 or 178.4%. This increase is due primarily to allowance for doubtful accounts of approximately $799,000 for the three months ended June 30, 2010, which expense was not present for the same period ended June 30, 2009; offset in part by a decrease in stock based compensation. Total operating expenses for the three months ended June 30, 2009 were related to selling, general and administrative expenses.

As a result of the foregoing, we had a net income of approximately $270,200 for the three months ended June 30, 2010, compared to a net loss of approximately $394,000 for the three months ended June 30, 2009, a change of $664,200 or 168.6%.

Comparison of the six month period ended June 30, 2010 with the six month period ended June 30, 2009.

The Company recorded approximately $3,184,300 in service revenues for the six months ended June 30, 2010 and no revenue in the same period in 2009. This increase is attributable to revenues generated from the Company’s spine injury treatment centers in Houston and McAllen, Texas. The centers were not open for the six months ended June 30, 2009. During the six month period ended June 30, 2009, the Company’s operations were limited to initial planning of the Company’s spine injury treatment business, preparing for the opening of its first spine injury treatment center and satisfying continuous public disclosure requirements.

Service cost was approximately $687,000 for the six months ended June 30, 2010 compared to none in the same period in 2009.

During the six months ended June 30, 2010, the Company incurred approximately $382,200 of general and administration expenses as compared to approximately $1.1 million for the same period in 2009. The $382,200 of general and administrative expenses incurred during the six months ended June 30, 2010 includes recurring general and administrative charges, as well as approximately $210,000 of stock based compensation recorded as general and administrative expenses. For the six months ended June 30, 2009, there was approximately $769,000 of stock based compensation recorded as well as approximately $282,000 towards legal settlement and other expenses included as general and administrative expenses.

The total operating expenses for the six months ended June 30, 2010 and 2009 were approximately $1,876,800 and $1,051,000 respectively, representing an increase of approximately $825,800 or 78.6%. This increase is due primarily to allowance for doubtful accounts of approximately $1.5 million for the six months ended June 30, 2010, which expense was not present for the same period ended June 30, 2009, offset by a decrease in stock based compensation and other general and administrative expenses from the same period in 2009.

As a result of the foregoing, we incurred a net income of $625,355 for the six months ended June 30, 2010, compared to a net loss of $1,050,903 for the six months ended June 30, 2009, a change of $1,676,258 or 159.5%.

Liquidity and Capital Resources

For the six months ended June 30, 2010, cash used in operations was $19,150, which primarily included an increase in accounts receivable of approximately $3.0 million; partially offset by an increase in amounts due to related parties of approximately $41,400 and an increase to accounts payable and accrued liabilities of $384,000, an allowance for doubtful accounts of approximately $1.5 million, issuance of common stock towards payable to NSO of $200,000, issuance of common stock for consulting services and stock based compensation of $210,000 and net income of approximately $625,400 from operations. For the same period in 2009, net cash used in operating activities was $0, due primarily to a net loss of approximately $1.1 million, offset by costs of issuing common stock for consulting services, stock based compensation & acquisition of intangible assets of $769,000, an increase in amounts due to related parties of $163,721 and an increase in accounts payable and accrued liabilities of approximately $118,000.

There was no cash provided or used in investing and financing activities for the six months ended June 30, 2010 or 2009.

ITEM 4. CONTROLS AND PROCEDURES

Our principal executive officer and principal financial officer are responsible for establishing and maintaining disclosure controls and procedures for the Company. Such officers have concluded (based upon their evaluation of these controls and procedures as of the end of the period covered by this report) that our disclosure controls and procedures are effective to ensure that information required to be disclosed by us in this report is accumulated and communicated to management, including our principal executive and principal financial officer as appropriate, to allow timely decisions regarding required disclosure.

Our principal executive officer and principal financial officer have also indicated that, upon evaluation, there were no changes in our internal control over financial reporting or other factors during the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

Our management, including our principal executive officer and principal financial officer, does not expect that our disclosure controls or our internal controls will prevent all error and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. In addition, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people or by management override of the control. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Because of these inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

PART II OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

In March 2008, Kent Carasquero, Leslie Lounsbury, Riverside Manitoba, Inc. and Tyeee Capital Consultants, Inc. filed suit against the Company, Richard Specht, Rene Hamouth, -Hamouth Family Trust, William R. Dunavant, and William R. Dunavant Family Holdings, Inc. The suit was filed in The United States District Court, Middle District of Florida and requests damages and injunctive relief for various breaches of contract and securities violations. A default judgment was entered against the defendants on July 20, 2008. The default judgment was set aside and the case reopened on November 7, 2008. The Company believes all claims against it are without merit, and it will continue to vigorously defend itself against such claims. There is no assurance, however, that the matter can be settled on terms favorable to the Company.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

On May 11, 2010, the Company approved and authorized the issuance to John Talamas, the Company’s Chief Operating Officer, of 50,000 shares of restricted common stock as consideration for serving as an executive officer. The shares were issued under the exemption from registration provided by Section 4(2) of the Securities Act of 1933 and the rules and regulations promulgated thereunder. The offer and sale of the shares was made exclusively to an “accredited investor” (as such term is defined in Rule 501(a) of Regulation D) in an offer and sale not involving a public offering. The holder of the shares purchased the securities for his own account and not with a view towards or for resale. There was no general solicitation or advertising conducted in connection with the sale of the securities.

On May 11, 2010, the Company approved and authorized the issuance to Richard Specht, a Director of the Company, of 250,000 shares of restricted common stock as consideration for serving on the Board of Directors. The shares were issued under the exemption from registration provided by Section 4(2) of the Securities Act of 1933 and the rules and regulations promulgated thereunder. The offer and sale of the shares was made exclusively to an “accredited investor” (as such term is defined in Rule 501(a) of Regulation D) in an offer and sale not involving a public offering. The holder of the shares purchased the securities for his own account and not with a view towards or for resale. There was no general solicitation or advertising conducted in connection with the sale of the securities.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 6. EXHIBITS

INDEX TO EXHIBITS

Exhibit No.		Description
3(i)(a)		Articles of Incorporation dated March 4, 1998. (Incorporated by reference from Form 10SB filed with the SEC on January 5, 2000.) *

3(i)(b)		Amended Articles of Incorporation dated April 23,1998. (Incorporated by reference from Form 10SB filed with the SEC on January 5, 2000.) *

3(i)(c)		Amended Articles of Incorporation dated January 4, 2002. (Incorporated by reference from Form 10KSB filed with the SEC on May 21, 2003.) *

3(i)(d)		Amended Articles of Incorporation dated December 19, 2003. (Incorporated by reference from Form 10KSB filed with the SEC on May 20, 2004.) *

3(i)(e)		Amended Articles of Incorporation dated November 4, 2004. (Incorporated by reference from Form 10KSB filed with the SEC on April 15,2005) *

3(i)(f)		Amended Articles of Incorporation dated September 7,2005. (Incorporated by reference from Form 10QSB filed with the SEC on November 16, 2005) *

3(ii)		By-Laws dated April 23, 1998. (Incorporated by reference from Form 10SB filed with the SEC on January 5, 2000.) *

10(i)		The 2003 Benefit Plan of Delta Capital Technologies, Inc. dated August 20, 2003 (Incorporated by reference from Form S-8 filed with the SEC on August 26, 2003) *

10(ii)		Employee Agreement dated April 30, 2004 between the Company and Kent Carasquero. (Incorporated by reference from Form 10KSB filed with the SEC on May 20, 2004 *

10(iii)		Employee Agreement dated April 30, 2004 between the Company and Martin Tutschek. (Incorporated by reference from Form 10KSB filed with the SEC on May 20, 2004) *

10(iv)		Employee Agreement dated October 1, 2004 between the Company and Roderick Shand (Incorporated by reference from Form 10KSB filed with the SEC on April 15, 2005) *

10(v)		Employee Agreement dated October 1, 2004 between the Company and Mr. Paul Bains (Incorporated by reference from Form 10KSB filed with the SEC on April 15, 2005) *

10(vi)		Consulting Agreement dated October 1, 2004 between the Company and Kent Carasquero. (Incorporated by reference from Form 10KSB filed with the SEC on April 15, 2005) *

10(vii)		Portal Development Agreement dated July 15, 2005 between the Company and Sygenics Interactive Inc. (Incorporated by reference from Form 8-K filed with the SEC on August 9, 2005) *

10(viii)		Debt Settlement Agreement dated August 3, 2005 between the Company and Rajesh Vadavia and Sygenics Interactive, Inc. (Incorporated by reference from Form 10KSB filed with the SEC on April 17, 2006) *

10(ix)		Debt Settlement Agreement dated September 30, 2005 between the Company and Leslie Lounsbury. (Incorporated by reference from Form 10QSB filed with the SEC on November 16, 2005) *

10(x)		Debt Settlement Agreement dated November 9, 2005 between the Company and Roderick Shand. (Incorporated by reference from Form 10KSB filed on April 17, 2006) *

10(xi)		Debt Settlement Agreement dated November 9, 2005 between the Company and Paul Bains. (Incorporated by reference from Form 10KSB filed on April 17, 2006) *


10(xii)		Agreement and Plan of Merger between MangaPets Inc. and Intrepid World Communications Corporation dated January 29, 2007.(Incorporated by reference from Form 8k filed on January 29,2007) *

10(xiii)		Merger Agreement dated November 21, 2007 between the Company and First Versatile Smartcard Solutions Corporation (Incorporated by reference from Form 8-K filed on April 22, 2008) *

10(xiv)		Stock Purchase Agreement dated April 28, 2008 between the Company, First Versatile Smartcard Solutions Corporation and MacKay Group, Ltd. (Incorporated by reference from Form 10-K filed on April 15, 2009)*

10(xv)		Mutual Release and Settlement Agreement dated December 30, 2008 between the Company, James MacKay, MacKay Group, Ltd., Celebrity Foods, Inc. and Michael Cimino. (Incorporated by reference from Form 10-K filed on April 15, 2009)*

10(xvi)		Employment Agreement dated February 21, 2009 between the Company and William Donovan, M.D. (Incorporated by reference from Form 10-K filed on April 15, 2009)*

10(xvii)		Employment Agreement dated February 25, 2009 between the Company and John Talamas (Incorporated by reference from Form 10-K filed on April 15, 2009)*

10(xviii)		Employment Agreement dated February 21, 2009 between the Company and Brian Koslow (Incorporated by reference from Form 10-K filed on April 15, 2009)*

14		Code of Ethics (Incorporated by reference from Form 10KSB filed with the SEC on April 15, 2005) *

31(i)		Certification of principal executive officer required by Rule 13a – 14(1) or Rule 15d – 14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31(ii)		Certification of principal financial officer required by Rule 13a – 14(1) or Rule 15d – 14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32(i)		Certification of principal executive officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and Section 1350 of 18 U.S.C. 63.

32(ii)		Certification of principal financial officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and Section 1350 of 18 U.S.C. 63.

* Incorporated by reference from previous filings of the Company

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	Spine Pain Management, Inc.

Date: August 16, 2010	/s/ William F. Donovan, M.D.
	By: William F. Donovan, M.D.
	Chief Executive Officer and Principal Financial Officer