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Item 1A. Risk Factors

2025-03-14 compared with 2024-03-27 · 161 added, 83 removed, 894 unchanged (21% of the section changed)

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$5 million to $10 million.

If, and to the extent, that sellers are unwilling to accept a significant portion of the purchase price in seller

notes and equity, then the cash required to execute our business plan could be as much as $10 million.

If, and to the extent, that sellers are unwilling to accept a significant portion of the purchase price in

seller notes and equity, then the cash required to execute our business plan could be as much as $10 million.

Although we do not believe that we will require

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continue as a going concern, our stockholders would likely lose most or all of their investment in our company.

Our typical accounts receivable collection

lifecycle is between 18 and 24 months.

This extended period creates several risks relating to our liquidity and cash flow, exposure to

bad debt, dependence on external financing, negative impact on our financial metrics and operational challenges.

We operate in the lien-based medical industry.

We provide orthopedic healthcare to uninsured patients.

Our patients have typically been in an accident and have filed a lawsuit as a

plaintiff against the defendant who is allegedly responsible for the accident as the result of negligence or another tort.

Since the patient

is uninsured, we must wait for payments of amounts owed to us until the patient’s lawyer settles the claim against the defendant’s

insurance company or the defendant himself.

As a result of our need to wait for such a settlement, we experience an extended accounts

receivable collection period, which typically ranges from 18 to 24 months.

This extended accounts receivable collection period is very

different from a traditional product or service business that collects a majority of receivables within 30, 60, and/or 90-day increments.

We routinely receive a letter of protection from our patient and its legal counsel which ensures payment in full from insurance settlements.

A letter of protection is a legally binding contract that exists between the patient’s personal injury attorney, the patient, and

our company, as the healthcare provider.

The letter promises that the patient will pay the medical expenses after the patient’s

injury claim reaches its settlement.

This prolonged collection cycle presents several

risks that could materially and adversely affect our business, financial condition, and results of operations, including the following.

Liquidity and Cash Flow Constraints :

The long duration between the sale of our products or services and the receipt of payment from our customers can significantly strain our liquidity and cash flow.

This extended time period can limit our ability to invest in growth opportunities, meet our operating expenses, and fulfill our obligations as they become due.

Increased Exposure to Bad Debt :

Notwithstanding that we typically receive a letter of protection, extended collection periods increase the risk that a net settlement will not be collected in cases where no settlement is reached with the defendant’s insurance company and the plaintiff (our patient) loses the case at trial, or the case is abandoned, potentially leading to higher than anticipated bad debt expenses.

Dependence on External Financing :

To mitigate the impact of delayed collections, we may need to rely more heavily on external financing sources such as factoring arrangements, lines of credit, loans, or equity financing.

Such dependence may result in increased interest expenses, dilution of stockholders' equity, or restrictive covenants that could limit our operational flexibility.

Impact on Financial Metrics :

Prolonged accounts receivable cycles can distort our financial metrics, including working capital ratios, days sales outstanding (DSO), and cash conversion cycle.

These distorted metrics may negatively influence investor perceptions, credit ratings, and our overall financial health.

Operational Challenges :

Managing long accounts receivable cycles requires robust credit risk management and collections processes.

Failure to effectively manage these processes could lead to inefficiencies and higher operational costs.

As a result of these risks relating to our extended

accounts receivable collection cycles, our financial condition, prospects and results of operations may be materially adversely affected.

We lack systematic processes and resources

to support the aging of our accounts receivables, which can result in inefficiencies and higher operational costs.

In order to remedy

this issue, we expect to make significant expenditures.

Our business model involves providing healthcare

services to patients who have been involved in accidents, with payment for these services typically collected from the patient’s

settlement with the defendant’s insurer.

This business model results in an extended accounts receivable collection period of 18

to 24 months.

The lengthy collection period may adversely impact our cash flow and liquidity, making it more challenging to meet operational

and financial obligations.

Historically, we have not maintained systematic

processes and resources to manage and monitor the aging of our accounts receivables.

The settlement process is complex and ongoing patient

care can further complicate the accurate aging of receivables.

These complexities may lead to difficulties in assessing the true financial

health of our company and in predicting cash flow accurately.

Currently, our third-party billing company only captures the first date

of service for each patient.

This first date of service may be months before surgery or before any significant services have been rendered.

The receivable relating to the patient continues to grow over time, which distorts the actual aging of the receivable.

With regard to

facilities and anesthesiology services, our third-party billing company historically had not captured any first date of service, so we

do not have historical data relating to the aging of accounts receivable relating to these services.

Recently, we have been working with

our third-party billing company to resolve the systematic issue with respect to facilities and anesthesiology services in order to begin

to capture the first date of service.

We believe that these changes to our financial systems will assist us going forward, but we expect

an 18 to 24 month lag before we are able to obtain relevant aging data with regard to these receivables.

We expect that it will take 18 to 24 months to

support the aging of our accounts receivables and ensure accurate estimation of the receivable lifecycle, and will require us to devote

significant resources during that period.

These resources include additional dedicated personnel.

We do not expect a significant additional

out-of-pocket cost to remedy this situation.

We are in the process of implementing enhanced

practices to better capture and manage the aging of its billings for accounts receivable.

However, these practices are not yet fully operational.

Until these new practices are effectively in place, we remain exposed to risks associated with delayed collections and potential inaccuracies

in financial reporting.

If we are unable to successfully implement and

maintain these enhanced processes, we may face continued challenges in managing our accounts receivables, which could have a material

adverse effect on its financial condition, results of operations, and cash flows.

Investors should consider these risks when evaluating

our financial stability and performance.

Our acquisition strategy exposes us to substantial

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Such acquisitions are subject to various risks and uncertainties, including:

· the inability to effectively integrate the operations, products, technologies, and personnel of the acquired

companies (some of which are in diverse geographic regions) and achieve expected synergies;

· the potential disruption of existing business and diversion of management’s attention from day-to-day

the inability to effectively integrate the operations, products, technologies, and personnel of the acquired companies (some of which are in diverse geographic regions) and achieve expected synergies;

the potential disruption of existing business and diversion of management’s attention from day-to-day operations;

the inability to maintain uniform standards, controls, procedures, and policies;

the need or obligation to divest portions of the acquired companies;

· the potential failure to identify material problems and liabilities during due diligence review of acquisition

· the potential failure to obtain sufficient indemnification rights to fully offset possible liabilities

associated with acquired businesses;

the potential failure to identify material problems and liabilities during due diligence review of acquisition targets;

the potential failure to obtain sufficient indemnification rights to fully offset possible liabilities associated with acquired businesses;

the challenges associated with operating in new geographic regions.

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the consent of our stockholders, which may result in our acquiring businesses or assets that are different from, and possibly riskier

than, the strategy described in this prospectus.

than, the strategy described in this report.

A change in our strategy may increase our exposure to interest rate and currency fluctuations,

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firm with respect to such a transaction, conflicts of interest may still exist with respect to a particular acquisition and, as a result,

the terms of the acquisition of a target business may not be as advantageous to our shareholders as it would have been absent any conflicts

the terms of the acquisition of a target business may not be as advantageous to our stockholders as it would have been absent any conflicts

The operational objectives and business

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be able to accurately report our financial results and prevent fraud.

As a result, current and potential shareholders could lose confidence

in our financial statements, which would harm the trading price of our common shares.

As a result, current and potential stockholders could lose confidence

in our financial statements, which would harm the trading price of our common stock.

Companies that file reports with the SEC, including

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were associated with our lack of (i) formal documentation over internal control procedures and environment, (ii) proper segregation of

duties and multiple level of reviews and (iii) expertise in accounting of derivative liabilities.

We also have not developed and

effectively communicated our accounting policies and procedures to our employees, which has resulted in inconsistent practices.

undertaking remedial measures, which measures will take time to implement and test, to address these material weaknesses.

no assurance that such measures will be sufficient to remedy the material weaknesses identified or that additional material weaknesses

or other control or significant deficiencies will not be identified in the future.

If we continue to experience material weaknesses in

our internal controls or fail to maintain or implement required new or improved controls, such circumstances could cause us to fail to

meet our periodic reporting obligations or result in material misstatements in our financial statements, or adversely affect the results

of periodic management evaluations and, if required, annual auditor attestation reports.

Each of the foregoing results could cause investors

to lose confidence in our reported financial information and lead to a decline in our stock price.

duties and multiple level of reviews and (iii) sufficient process, systems and access to technical accounting resources to enable appropriate

accounting for and reporting on complex and/or non-routine debt and equity financing transactions including accounting for derivatives,

convertible debt, preferred stock.

We also have not developed and effectively communicated our accounting policies and procedures

to our employees, which has resulted in inconsistent practices.

We are undertaking remedial measures, which measures will take time to

implement and test, to address these material weaknesses.

There can be no assurance that such measures will be sufficient to remedy the

material weaknesses identified or that additional material weaknesses or other control or significant deficiencies will not be identified

in the future.

If we continue to experience material weaknesses in our internal controls or fail to maintain or implement required new

or improved controls, such circumstances could cause us to fail to meet our periodic reporting obligations or result in material misstatements

in our financial statements, or adversely affect the results of periodic management evaluations and, if required, annual auditor attestation

Each of the foregoing results could cause investors to lose confidence in our reported financial information and lead to a decline

in our stock price.

Risks Related to Our Healthcare Business

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of the above factors may lead to cost overruns and longer periods before a return is generated on an investment, if at all.

significant capital expenditure but due to a regulatory, planning, or other reason, may find that we are prevented from opening a new

significant capital expenditure but due to a regulatory, planning, or other reason, we may find that we are prevented from opening a new

facility or modifying an existing facility.

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Our revenue is primarily provided by bodily injury

policies, general liability policies, and personal injury protection policies, which partially insulates our business from the declining

reimbursement programs paid from or correlated to Medicare/Medicaid and traditional health insurance companies.

However, we do also depend

on private and governmental third-party sources of payment for the services provided to patients and assume financial risks related to

changes in third-party reimbursement rates and changes in payor mix.

In some cases, our revenue decreases if our volume or reimbursement

decreases, but our expenses, including physician compensation, may not decrease proportionately.

insurance policies, general liability policies, and personal injury protection policies, which partially insulates our business from the

declining reimbursement programs paid from or correlated to Medicare/Medicaid and traditional health insurance companies.

do also depend on private and governmental third-party sources of payment for the services provided to patients and assume financial risks

related to changes in third-party reimbursement rates and changes in payor mix.

In some cases, our revenue decreases if our volume or

reimbursement decreases, but our expenses, including physician compensation, may not decrease proportionately.

The amount we receive for our services may be

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Failure to timely or accurately bill for

services could have a negative impact on our net revenue, bad debt expense and cash flow.

services could have a negative impact on our net revenue and cash flow.

Billing for healthcare services is an important

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our reliance on third-parties to provide billing services for certain of our service lines;

· the difficulty of adherence to specific compliance requirements, diagnosis coding and other procedures

mandated by various payors;

· in connection with billing for physician services, failure to obtain proper physician credentialing and

documentation in order to bill various payors.

the difficulty of adherence to specific compliance requirements, diagnosis coding and other procedures mandated by various payors;

in connection with billing for physician services, failure to obtain proper physician credentialing and documentation in order to bill various payors.

To the extent that the complexity associated with

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We cannot assure you that practices that are outside of a safe harbor will not be found to violate the anti-kickback

The Centers for Medicare and Medicaid Services, or CMS, published a Medicare

self-referral disclosure protocol, which is intended to allow providers to self-disclose actual or potential violations of the Stark Law.

Because there are only a few judicial decisions interpreting the Stark Law, there can be no assurance that our facilities will not be

found in violation of the Stark Law or that self-disclosure of a potential violation would result in reduced penalties.

The CMS published a Medicare self-referral disclosure protocol, which is intended to allow providers to self-disclose actual

or potential violations of the Stark Law.

Because there are only a few judicial decisions interpreting the Stark Law, there can be no

assurance that our facilities will not be found in violation of the Stark Law or that self-disclosure of a potential violation would result

in reduced penalties.

Federal regulations issued under HIPAA contain

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As part of our normal business activities, we

produce and store clinical waste which may produce effects harmful to the environment or human health.

produce and store clinical waste which may produce effects that are harmful to the environment or human health.

The storage and transportation

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the possibility that development may require additional capital that we or our partner do not have;

· the possibility that a co-venturer or partner might breach a loan agreement or other agreement or otherwise,

by action or inaction, act in a way detrimental to us;

· that such co-venturer or partner may at any time have economic or business interests or goals that are

or that become inconsistent with the business interests or goals of our company;

the possibility that a co-venturer or partner might breach a loan agreement or other agreement or otherwise, by action or inaction, act in a way detrimental to us;

that such co-venturer or partner may at any time have economic or business interests or goals that are or that become inconsistent with the business interests or goals of our company;

the possibility that we may incur liabilities as the result of the action taken by our partner;

· that such co-venturer or partner may be in a position to take action contrary to our instructions or requests

or contrary to our policies or objectives;

· that such co-partner may exercise buy/sell rights that force us to or dispose of our share, at a time

and price that may not be consistent with our objectives.

Any of the above might subject our real estate

assets to liabilities in excess of those contemplated and thus reduce our returns on our investment.

that such co-venturer or partner may be in a position to take action contrary to our instructions or requests or contrary to our policies or objectives;

that such co-partner may exercise buy/sell rights that force us to or dispose of our share, at a time and price that may not be consistent with our objectives.

Any of the above might subject our real estate assets to liabilities

in excess of those contemplated and thus reduce our returns on our investment.

Uninsured losses relating to real property

or excessively expensive premiums for insurance coverage may adversely affect the value of your stock.

The nature of our activities could expose us to

potential liability for personal injuries and, in certain instances, property damage claims.

For instance, there are types of losses,

generally catastrophic in nature, such as losses due to wars, acts of terrorism, earthquakes, pollution, environmental matters, or extreme

weather conditions such as hurricanes, floods, and snow storms that are uninsurable or not economically insurable, or may be insured subject

to limitations, such as large deductibles or co-payments.

We may not carry all the usual and customary insurance policies which would

be carried by a similarly-positioned company, and we may not be carrying those insurance policies in amounts and types sufficient

to cover every risk which may be encountered by our company.

Insurance risks associated with potential terrorist acts could sharply increase

the premiums we will pay for coverage against property and casualty claims.

We cannot assure you that we will have adequate coverage for

If any of our properties incur a casualty loss that is not fully covered by insurance, the value of our assets will be reduced

by the amount of any such uninsured loss.

In addition, other than the capital reserve or other reserves we may establish, we do not expect

to have any contingent sources of funding in place to repair or reconstruct any uninsured damaged property, and we cannot assure you that

any such sources of funding will be available to us for such purposes in the future.

Also, to the extent we must pay unexpectedly large

amounts for insurance, we could suffer reduced earnings that would result in a decreased value attributed to our publicly traded stock.

The nature of our activities could expose us

to potential liability for personal injuries and, in certain instances, property damage claims.

For instance, there are types of

losses, generally catastrophic in nature, such as losses due to wars, acts of terrorism, earthquakes, pollution, environmental

matters, or extreme weather conditions such as hurricanes, floods, and snowstorms that are uninsurable or not economically

insurable, or may be insured subject to limitations, such as large deductibles or co-payments.

We may not carry all the usual and

customary insurance policies which would be carried by a similarly-positioned company, and we may not be carrying those

insurance policies in amounts and types sufficient to cover every risk which may be encountered by our company.

Insurance risks

associated with potential terrorist acts could sharply increase the premiums we will pay for coverage against property and casualty

We cannot assure you that we will have adequate coverage for all losses.

If any of our properties incur a casualty loss that

is not fully covered by insurance, the value of our assets will be reduced by the amount of any such uninsured loss.

other than the capital reserve or other reserves we may establish, we do not expect to have any contingent sources of funding in

place to repair or reconstruct any uninsured damaged property, and we cannot assure you that any such sources of funding will be

available to us for such purposes in the future.

Also, to the extent we must pay unexpectedly large amounts for insurance, we could

suffer reduced earnings that would result in a decreased value attributed to our publicly traded stock.

Risks Related to Ownership of Our Common Stock

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months may, under certain conditions, sell every three months, in brokerage transactions, a number of shares that does not exceed the

greater of 1.0% of a company’s outstanding common shares.

There is no limitation on the amount of restricted securities that may

be sold by a non-affiliate after the owner has held the restricted securities for a period of six months if our company is a current reporting

company under the Exchange Act.

A sale under Rule 144 or under any other exemption from the Securities Act, if available, or pursuant

to subsequent registration of common stock of present stockholders, may have a depressive effect upon the price of our common stock in

any market that may develop.

greater of 1.0% of a company’s outstanding shares of common stock.

There is no limitation on the amount of restricted securities

that may be sold by a non-affiliate after the owner has held the restricted securities for a period of six months if our company is a

current reporting company under the Exchange Act.

A sale under Rule 144 or under any other exemption from the Securities Act, if available,

or pursuant to subsequent registration of common stock of present stockholders, may have a depressive effect upon the price of our common

stock in any market that may develop.

Future issuances of debt securities, which

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if any, they may be able to achieve from an investment in our common stock.

If our common stocks become subject to the

penny stock rules, it would become more difficult to trade our common stock.

If our shares of common stock become subject

to the penny stock rules, it would become more difficult to trade our shares.

The SEC has adopted rules that regulate broker-dealer

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50,000,000 shares of preferred stock.

Our board acting alone and without approval of our stockholders can designate and issue one or

more series of preferred stock containing super-voting provisions, enhanced economic rights, rights to elect directors, or other dilutive

features, that could be utilized as part of a defense to a take-over challenge.

Our board acting alone and without approval of our stockholders can designate and issue one or more

series of preferred stock containing super-voting provisions, enhanced economic rights, rights to elect directors, or other dilutive features,

that could be utilized as part of a defense to a take-over challenge.

In addition, various provisions of our amended

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors