UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

x ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended: December 31, ~~2012~~2014

¨ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to _____________

Commission File No.: 000-27795

~~AVWORKS~~VAPOR ~~AVIATION~~GROUP, ~~CORP~~INC. (Exact name of registrant as specified in its charter)

(Exact name of registrant as specified in its charter)

Florida		98-0427526
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

~~10778~~3901 NWSW ~~53RD~~47th ~~STREET~~AVENUE, SUITE E415

~~SUNRISE~~DAVIE, FLORIDA ~~33356~~33314

(Address of principal executive offices)

Registrant’s telephone number, including area code: (954) ~~990~~792-~~6827~~8450

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

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

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

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

Indicate by check mark whether the registrant has (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 ~~o No~~ x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x o No x ¨

Indicate by check mark if disclosure of delinquent filers in response to Item 405 of Regulation S-K (§229.405) is not contained herein, and will not be contained, to the best of the registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. Yes o ¨ No x

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 the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer	¨	Accelerated filer	¨
Non-accelerated filer	¨	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

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average ~~big~~bid and ~~asked~~ask price of such common equity, as of the last business day of the registrant's most recently completed ~~second~~ fiscal quarter: ended December 31, 2014 was $~~459~~2,~~034~~969,495. (This calculation is based on historical data at ~~June~~December 3031, ~~2013~~2014). For purposes of the foregoing calculation only, directors, executive officers, and holders of 10% or more of the issuer’s common capital stock have been deemed affiliates.

The number of shares outstanding of the Registrant’s Common Stock as of ~~January 10~~March 30, ~~2014 was~~2015 ~~270~~is 2,~~020~~658,~~145~~813,601.

DOCUMENTS INCORPORATED BY REFERENCE: ~~None.~~

~~TABLE OF CONTENTS~~None.

ITEM 1.	BUSINESS.	4
ITEM 1A.	RISK FACTORS	6
ITEM 1B.	UNRESOLVED STAFF COMMENTS.	11
ITEM 2.	PROPERTIES.	11
ITEM 3.	LEGAL PROCEEDINGS.	11
ITEM 4.	MINE SAFETY DISCLOSURE.	11
ITEM 5.	MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.	12
ITEM 6.	SELECTED FINANCIAL DATA.	14
ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.	15
ITEM 7A.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.	20
ITEM 8.	FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.	20
ITEM 9.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.	20
ITEM 9A.	CONTROLS AND PROCEDURES.	20
ITEM 9B.	OTHER INFORMATION.	21
ITEM 10.	DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE.	22
ITEM 11.	EXECUTIVE COMPENSATION.	23
ITEM 12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.	25
ITEM 13.	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.	25
ITEM 14.	PRINCIPAL ACCOUNTANT FEES AND SERVICES.	25
ITEM 15.	EXHIBITS, FINANCIAL STATEMENT SCHEDULES.	26

TABLE OF CONTENTS

ITEM 1.	BUSINESS.	6

ITEM 1A.	RISK FACTORS	9

ITEM 1B.	UNRESOLVED STAFF COMMENTS.	19

ITEM 2.	PROPERTIES.	19

ITEM 3.	LEGAL PROCEEDINGS.	19

ITEM 4.	MINE SAFETY DISCLOSURE.	19

ITEM 5.	MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.	20

ITEM 6.	SELECTED FINANCIAL DATA.	30

ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.	31

ITEM 7A.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.	38

ITEM 8.	FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.	38

ITEM 9.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.	38

ITEM 9A.	CONTROLS AND PROCEDURES.	39

ITEM 9B.	OTHER INFORMATION.	40

ITEM 10.	DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE.	41

ITEM 11.	EXECUTIVE COMPENSATION.	44

ITEM 12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.	45

ITEM 13.	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.	46

ITEM 14.	PRINCIPAL ACCOUNTANT FEES AND SERVICES.	46

ITEM 15.	EXHIBITS, FINANCIAL STATEMENT SCHEDULES.	47

INTRODUCTORY COMMENT

This Annual Report on Form 10-K ("Annual Report"), in particular the Management'’s Discussion and Analysis of Financial Condition and Results of Operations appearing in Item 7 herein ("MD&A") contains certain "forward-looking statements"” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements give expectations or forecasts of future events. The reader can ~~indentify~~identify these forward-looking statements by the fact that they do not relate strictly to historical or current facts. They use words such as "believe(s)," "goal(s)," "target(s)," "estimate(s)," "anticipate(s)," "forecast(s)," "project(s)," (plan(s)," "intend(s)," "expect(s)," "might," may" and other words and terms of similar meaning in connection with a discussion of future operating, financial performance or financial condition. Forward-looking statements, in particular, include statements relating to future actions, prospective services or products, future performance or results of current and anticipated services or products, sales efforts, expenses, the outcome of contingencies such as legal proceedings, trends of operations and financial results.

Any or all forward-looking statements may turn out to be wrong, and, accordingly, readers are cautioned not to place undue reliance on such statements, which speak only as of the date of this Annual Report. These statements are based on current expectations and current the current economic environment. They involve a number of risks and uncertainties that are difficult to predict. These statements are not guarantees of future performance; actual results could differ materially from those expressed or implied in the forward-looking statements. Forward-looking statements can be affected by inaccurate assumptions or by known or unknown risks and uncertainties. Many such factors will be important in determining the Company's actual results and financial condition. The reader should consider the following list of general factors that could affect the Company's future results and financial condition.

Among the general factors that could cause actual results and financial condition to differ materially from estimated results and financial condition are:

* the · The success or failure of management's efforts to implement their business strategy · The ability of the Company to raise sufficient capital to meet operating requirements · The uncertainty of consumer demand for our products and services; · The ability of the Company to compete with major established companies; · Heightened competition, including, with respect to pricing, entry of · New competitors and the development of new products by new and existing competitors; · Absolute and relative performance of our products and services; · The effect of changing economic conditions; · The ability of the Company to attract and retain quality employees and management; · The current global recession and financial uncertainty; and · Other risks which may be described in future filings with the U.S. Securities and Exchange Commission ("SEC").

* the ability of the Company to raise sufficient capital to meet operating requirements;

* the uncertainty of consumer demand for our products and services;

* the ability of the Company to compete with major established companies;

* heightened competition, including, with respect to pricing, entry of new competitors and the development of new products by new and existing competitors;

* absolute and relative performance of our products and services;

* the effect of changing economic conditions;

* the ability of the Company to attract and retain quality employees and management;

* the current global recession and financial uncertainty; and

* other risks which may be described in future filings with the U.S. Securities and Exchange Commission ("SEC").

No assurances can be given that the results contemplated in any forward-looking statements will be achieved or will be achieved in any particular timetable. We assume no obligation to publicly correct or update any forward-looking statements as a result of events or developments subsequent to the date of this Annual Report. The reader is advised, however, to consult any further disclosures we make on related subjects in our filings with the SEC.

PART I

ITEM 1. BUSINESS.

Corporate Overview and History of AvWorks Aviation Corp..

We had been originally incorporated under the laws of Canada on January 15, 1990, under the name "Creemore Star Printing, Inc." We changed our name on June 15, 2003 to "Smitten Press: Local Lore and Legends, Inc." We domesticated in the State of Nevada by filing Articles of Incorporation in Nevada on May 8, 2007, and we were incorporated in the State of Nevada on May 8, 2007, as SmittenPress: Local Lore and Legends, Inc. On April 30, 2010, our Board of Directors approved a change in our name to DataMill Media Corp., effective at the close of business on June 30, 2010. In June 2011, we completed our initial public offering of 5,000,000 shares of Common Stock and received $100,000 in proceeds from the offering.

We were a management consulting firm that planned to educate and assist small businesses to improve their management, corporate governance, regulatory compliance and other business processes, with a focus on capital market participation. However, after we completed our initial public offering, we explored a couple of opportunities to acquire operating companies in order to enhance shareholder value. On September 2, 2011, we entered into a Share Exchange Agreement with Young Aviation, LLC. On September 19, 2011, we amended our Articles of Incorporation to (i) increase our authorized capital stock to 500,000,000 shares of Common Stock and (ii) effect a 10 shares for one share forward stock split. On October 3, 2011, we closed the Share Exchange Agreement, which resulted in Young Aviation, LLC becoming a wholly-owned subsidiary. On November 10, 2011, a majority of our shareholders approved a change in our name to AvWorks Aviation Corp., effective November 30, 2011, to reflect the Company’s business focus.

Young Aviation, founded in 2004, is currently a diversified broker and supplier of parts, components and products to the general aviation and aerospace markets of the U.S., Europe and Asia. "General aviation" is defined as all aviation other than military and scheduled commercial airlines. Over 20% of our sales revenue has been derived from international sales for the period from January 1, 2009 to date.

Young Aviation services a broad range of clients such as aircraft leasing companies, major airlines, repair stations, fixed-base operators, leasing companies and after market suppliers.

As a result of the Share Exchange Agreement, the Company acquired Young Aviation and Joel A. Young became the President, Chief Executive Officer and sole Director of the Company on October 3, 2011, when our prior management officials resigned. In addition, as a result of acquiring Young Aviation, we ceased being a "shell company" as that term is defined in Section 12b-2 of the Securities Exchange Act of 1934.

The acquisition of Young Aviation, considered a reverse merger, resulted in a change in control at the Company and new management decided to abandon our former business of management consulting and focus solely on the business of Young Aviation. In early, 2013 the Company decided to seek other business opportunities and as result the Company is investigating certain opportunities and has decided to abandon the activities of Young Aviation.

Effective on August 1, 2013, the Board of Directors of the Company, accepted the resignation of Joel Young as the President/Chief Executive Officer, Secretary, Treasurer/Chief Financial Officer and a member of the Board of Directors. Simultaneously, the Board of Directors accepted the consent of Michael Zoyes, as a member of the Board of Directors, the President/Chief Executive Officer, Secretary, Treasurer and Chief Financial Officer of the Company. Therefore, as of the date of this Current Report, the member of the Board of Directors is Michael Zoyes.

Mr. Young did not resign as a result of any disagreement with the Company on any matter relating to the Company’s operations, policies or practices.

Effective on September 23, 2013, the Board of Directors of the Company, accepted the resignation of Michael Zoyes as the President/Chief Executive Officer, Secretary, Treasurer/Chief Financial Officer and a member of the Board of Directors. Simultaneously, the Board of Directors accepted the consent of Joe Eccles, as a member of the Board of Directors, the President/Chief Executive Officer, Secretary, Treasurer and Chief Financial Officer of the Company. Therefore, as of the date of this Current Report, the member of the Board of Directors is Joe Eccles.

Mr. Zoyes did not resign as a result of any disagreement with the Company on any matter relating to the Company’s operations, policies or practices.

Members of the Board of Directors and stockholders owning or having voting authority for 165,000,000 shares of outstanding Common Stock and 1,000,000 shares of our Series A Preferred Stock have voted in favor of an amendment to our Articles of Incorporation to affect a reverse stock split of all of the outstanding shares of Common Stock, at a ratio of one-for-thirty. The reverse split is currently pending and will become effective once FINRA completes its review of the Company’s filings related to this corporate action.

Overview

This discussion of the proposed business is purposefully general and is not meant to be restrictive of our virtually unlimited discretion to search for and enter into potential business opportunities. We anticipate that we may be able to participate in only one potential business venture because we have nominal assets and limited financial resources. This lack of diversification should be considered a substantial risk to our stockholders because it will not permit us to offset potential losses from one venture against gains from another.

We may seek a business opportunity with entities which have recently commenced operations, or which wish to utilize the public marketplace in order to raise additional capital in order to expand into new products or markets, to develop a new product or service, or for other corporate purposes. We may acquire assets and establish wholly-owned subsidiaries in various businesses or acquire existing businesses as subsidiaries. We anticipate that the selection of a business opportunity in which to participate will be complex and extremely risky. Due to general economic conditions, rapid technological advances being made in some industries and shortages of available capital, management believes that there are numerous firms seeking the perceived benefits of a publicly registered corporation. These perceived benefits may include facilitating or improving the terms on which additional equity financing may be sought, providing liquidity for incentive stock options or similar benefits to key employees, providing liquidity (subject to restrictions of applicable statutes), for all stockholders and other factors. Potentially, available business opportunities may occur in many different industries and at various stages of development, all of which will make the task of comparative investigation and analysis of such business opportunities extremely difficult and complex.

The analysis of new business opportunities will be undertaken by, or under the supervision of, Mr. Joe Eccles, our chief executive officer and sole director, and our Board of Directors, and corporate advisors, all of whom may not be considered professional business analysts. Mr. Eccles will be the key person in the search, review and negotiation with potential acquisition or merger candidates. We intend to concentrate on identifying preliminary prospective business opportunities which may be brought to our attention through present associations of our officers and directors, or by our stockholders. In analyzing prospective business opportunities, we will consider such matters as the available technical, financial and managerial resources; working capital and other financial requirements; history of operations, if any; prospects for the future; nature of present and expected competition; the quality and experience of management services which may be available and the depth of that management; the potential for further research, development, or exploration; specific risk factors not now foreseeable but which then may be anticipated to impact our proposed activities; the potential for growth or expansion; the potential for profit; the perceived public recognition of acceptance of products, services, or trades; name identification; and other relevant factors. We will not acquire or merge with any company for which audited financial statements cannot be obtained within the time period prescribed by applicable rules of the Securities and Exchange Commission which is presently four business days from the closing date of the transaction. This requirement for readily available audited financial statement may require us to preclude a transaction with a potential candidate which might otherwise be beneficial to our stockholders.

WePART will not restrict our search for any specific kind of company, but may acquire a venture which is in its preliminary or development stage, which is already in operation, or in essentially any stage of its corporate life. It is impossible to predict at this time the status of any business in which we may become engaged, in that such business may need to seek additional capital, may desire to have its shares publicly traded, or may seek other perceived advantages which we may offer. However, we do not intend to obtain funds in one or more private placements to finance the operation of any acquired business opportunity until such time as we have successfully consummated such a merger or acquisition.I

WeITEM ~~anticipate that we will incur nominal expenses in the implementation of our business plan described herein~~1. ~~Because we have no capital with which to pay these anticipated expenses, these expenses will be paid by certain shareholders as interest-free loans~~BUSINESS. However, the only opportunity to have these loans repaid will be from a prospective merger or acquisition candidate. Repayment of any loans made on our behalf will not impede, or be made conditional in any manner, to consummation of a proposed transaction.

InCorporate ~~implementing~~Overview a structure for a particular business acquisition, we may become a party to a merger, consolidation, reorganization, joint venture, or licensing agreement with another corporation or entity. We may also acquire stock or assets of an existing business. On the consummation of a transaction, it is probable that our present management and ~~stockholders~~History ~~will no longer be in control~~ of ~~our~~Vapor ~~company. In addition~~Group, ~~our directors may, as part of the terms of the acquisition transaction, resign and be replaced by new directors without a vote of our stockholders or may sell their stock~~Inc. Any terms of sale of the shares presently held by officers and/or directors will be also afforded to all other stockholders on similar terms and conditions. Any and all such sales will only be made in compliance with federal and applicable state securities laws.

We ~~anticipate~~were ~~that~~originally ~~any~~incorporated ~~securities~~under ~~issued~~the inlaws ~~any~~of ~~such~~Canada ~~reorganization~~on ~~would~~January be15, ~~issued~~1990, inunder ~~reliance~~the ~~upon~~name ~~exemption~~"Creemore ~~from~~Star ~~registration~~Printing, ~~under~~Inc." ~~applicable~~We ~~federal~~changed ~~and~~our ~~state~~name ~~securities~~on ~~laws.~~June ~~In some circumstances~~15, ~~however,~~2003 asto a"Smitten ~~negotiated~~Press: ~~element~~Local ofLore aand ~~transaction~~Legends, weInc." ~~may~~We ~~agree~~domesticated toin ~~register~~the ~~all~~State orof aNevada ~~part~~by offiling ~~such~~Articles ~~securities~~of ~~immediately~~Incorporation ~~after~~in ~~the~~Nevada ~~transaction~~on isMay ~~consummated~~8, or2007, atand ~~specified~~we ~~times~~were ~~thereafter.~~incorporated Ifin ~~such~~the ~~registration~~State ~~occurs,~~ of ~~which~~Nevada ~~there~~on ~~can~~May be8, ~~no assurance~~2007, itas ~~will~~SmittenPress: beLocal ~~undertaken~~Lore byand ~~the~~Legends, ~~surviving~~Inc. ~~entity~~On ~~after~~April we30, ~~have~~2010, ~~successfully~~our ~~consummated~~Board aof ~~merger~~Directors orapproved ~~acquisition.~~a ~~The~~change ~~issuance~~in ofour ~~substantial~~name ~~additional~~to ~~securities~~DataMill ~~and~~Media ~~their~~Corp., ~~potential~~effective ~~sale~~at ~~into~~the ~~any~~close ~~trading~~of ~~market~~business ~~which~~on ~~may~~June ~~develop~~30, in2010. ~~our~~In ~~securities~~June ~~may~~2011, ~~have~~we acompleted ~~depressive~~our ~~effect~~initial onpublic ~~the~~offering ~~value~~ of ~~our~~5,000,000 ~~securities~~shares inof ~~the~~Common ~~future,~~Stock ifand ~~such~~received ~~a market develops~~$100,000 ofin ~~which~~proceeds ~~there~~from isthe ~~no assurance~~offering.

~~ITEM~~We 1Awere a management consulting firm that planned to educate and assist small businesses. ~~RISK~~ ~~FACTORS~~However, after we completed our initial public offering, we explored opportunities to acquire operating companies to enhance shareholder value. On September 2, 2011, we entered into a Share Exchange Agreement with Young Aviation, LLC, founded in 2004, a broker and supplier of parts, components and products to the general aviation (that is, non-military and commercial airline) and aerospace markets (“Young Aviation”).

~~You~~On ~~should~~September ~~carefully~~19, ~~consider~~2011, ~~the~~we ~~risks~~amended ~~described~~our ~~below~~Articles ~~together with all~~ of ~~the~~Incorporation ~~other~~to ~~information~~(i) ~~included~~increase inour ~~this~~authorized ~~report~~capital ~~before~~stock ~~making an investment decision with regard~~ to ~~our~~500,000,000 ~~securities. The~~shares ~~statements~~of ~~contained~~Common inStock orand ~~incorporated~~(ii) ~~herein~~effect ~~that~~a ~~are~~10:1 ~~not historic facts are~~ forward~~-looking~~ ~~statements~~stock ~~that~~split. ~~are~~On ~~subject~~October to3, ~~risks~~2011, ~~and~~we ~~uncertainties~~closed ~~that~~the ~~could~~Share ~~cause~~Exchange ~~actual~~Agreement, ~~results~~wherein toYoung ~~differ~~Aviation ~~materially~~became ~~from~~a ~~those set forth in or implied by forward~~wholly-~~looking~~owned ~~statements~~subsidiary. IfOn ~~any~~November of10, ~~the~~2011, ~~following~~a ~~risks~~majority ~~actually~~of ~~occurs,~~ our ~~business,~~shareholders ~~financial~~approved ~~condition~~a orchange ~~results~~ of ~~operations~~our ~~could~~name beto ~~harmed~~AvWorks Aviation Corp., Ineffective ~~that~~November ~~case~~30, ~~you~~2011, ~~may~~to ~~lose~~reflect ~~all~~the orCompany’s ~~part~~new ofbusiness ~~your investment~~focus.

~~Risks~~As ~~Relating~~a toresult ~~Our~~of ~~Business~~execution of the Share Exchange Agreement on October 3, 2011 in which the Company acquired Young Aviation: (a) the Company ceased being a "shell company" as that term is defined in Section 12b-2 of the Securities Exchange Act of 1934; (b) Joel Young, an individual, became the owner of 165,000,000 shares of restricted common stock of the Company or 61.11% of the total of 270,020,145 issued and outstanding shares of common stock of the Company as of that date, making him the Company’s majority shareholder; and (c) the Board of Directors of the Company appointed Joel A. Young as its President, CEO and sole Director. Following Joel Young’s acceptance of this appointment, all prior officers and directors of the Company resigned.

WEThe ~~ARE~~acquisition ~~CURRENTLY~~of AYoung ~~DEVELOPMENTAL~~Aviation ~~BUSINESS,~~was ~~AND~~by ~~INTEND~~reverse TOmerger ~~PURSUE~~and Aresulted ~~COURSE~~in OFa ~~ACQUISITION~~change in control of the Company and new management ‘s abandonment of its former management consulting business with a new focus solely on the business of Young Aviation. Subsequently, ~~MERGER~~as ~~AND~~the ~~ORGANIC~~result ~~GROWTH~~of the slow growth of such operations, ~~WHICH~~in ~~ACCORDINGLY~~early ~~MAY~~2013 ~~RESULT~~the INCompany ~~THE~~decided ~~VALUE~~to OFseek ~~YOUR~~other ~~SHARES~~business TOopportunities, ~~DECREASE~~including a business combination.

WeOn ~~are~~August ~~now~~1, a2013, ~~development~~the ~~business.~~Board Weof ~~continue~~Directors toaccepted ~~incur~~the ~~operating~~consent ~~expenses~~of ~~while~~Michael weZoyes ~~consider growth opportunities through merger & acquisition, and operating plans~~ to ~~execute~~become ~~our business plan. These plans may include business combinations with or investments in other operating companies, or entering into~~ a ~~completely~~member ~~new lines~~ of ~~business.~~its WeBoard ~~have~~of ~~not~~Directors, ~~yet~~the ~~identified all such opportunities~~President/CEO, ~~and thus~~Secretary, ~~you~~Treasurer ~~will~~and ~~not~~CFO beof ~~able to evaluate~~ the ~~impact~~Company ofreplacing ~~such~~Joel aYoung ~~business~~who ~~strategy~~resigned onas ~~the~~its ~~value~~sole ofofficer ~~your~~and ~~stock~~director. InMr. ~~addition,~~Young wedid ~~cannot~~not ~~assure~~resign ~~you~~as ~~that~~a weresult ~~will~~of ~~be able to identify~~ any ~~appropriate~~disagreement ~~business~~with ~~opportunities.~~the ~~Even~~Company ifon weany ~~are~~matter ~~able~~relating to ~~identify~~its ~~business~~operations, ~~opportunities~~policies ~~that~~or ~~our Board deems appropriate~~practices, weand ~~cannot~~remained ~~assure~~available ~~you~~to ~~that such a strategy will provide you with a positive return on your investment, and~~ it ~~may~~ in ~~fact~~an ~~result~~advisory incapacity awhile ~~substantial~~Mr. ~~decrease~~Zoyes inpursued ~~the~~a ~~value~~strategy of ~~your~~seeking ~~stock.~~a ~~These~~business ~~factors~~combination ~~will~~partner ~~substantially~~for ~~increase~~ the ~~uncertainty, and thus the risk, of investing in our shares~~Company.

WEOn ~~HAVE~~September ~~LIMITED~~3, ~~RESOURCES~~2013, ~~AND~~the NOmajority ~~REVENUES~~shareholder ~~FROM~~of ~~OPERATIONS~~the Company, ~~AND~~being ~~WILL~~the ~~NEED~~record ~~ADDITIONAL~~holder ~~FINANCING~~of IN165,000,000 ~~ORDER~~shares TOof ~~EXECUTE~~restricted ~~ANY~~common ~~BUSINESS~~stock ~~PLAN;~~of ~~OUR~~the ~~AUDITORS~~Company ~~HAVE~~(61.11% ~~EXPRESSED~~of ~~DOUBT~~the AS270,020,145 TOshares ~~OUR~~of ~~ABILITY~~common TOstock ~~CONTINUE~~issued ~~BUSINESS~~and ASoutstanding), and Corporate Excellence Consulting, Inc., a Florida corporation, the holder of 1,000,000 shares of the Series A ~~GOING~~Preferred ~~CONCERN~~Stock of the Company (100% of the issued and outstanding shares of preferred stock of the Company), (collectively, the “Sellers), entered into a share purchase agreement (the “Share Purchase Agreement”) with Dror Svorai, an individual, (the “Buyer”), and the future President and CEO of the Company (post-Merger Agreement as hereinafter described). In accordance with this Agreement, the Sellers agreed to sell and transfer over time their shares of restricted common stock and Series A Preferred Stock of the Company to the Buyer for a total purchase price of $115,000. The Share Purchase Agreement provided that the purchase price is to be paid on or before February 13, 2014 and that as the purchase price is being paid by the Buyer, the shares of common and preferred stock were to be released pro-rata to the Buyer by the Sellers. The Share Purchase Agreement was completed and paid-in-full within its terms, and the sale and transfer of the common stock and Series A Preferred Stock to the Buyer was finalized on February 20, 2014. The sale and purchase of the 165,000,000 shares of common stock of the Company constitutes 49.34% of the total issued and outstanding shares of the Company of 334,381,399 as of April 11, 2014, and the sale and purchases of the 1,000,000 shares of Series A Preferred Stock constitutes 100% of the total issued and outstanding shares of preferred stock which has over 50% voting control of the Company. As a result, Dror Svorai, an individual, is the controlling shareholder of the Company.

WeEffective ~~have~~on ~~limited~~September ~~resources~~23, no2013, ~~revenues~~the ~~from~~Board ~~operations~~of ~~during~~Directors ~~2012~~accepted ~~and our cash on hand may not be sufficient to satisfy our cash requirements during~~ the ~~next~~consent ~~twelve~~of ~~months.~~Joe ~~In addition~~Eccles, weto ~~will~~become ~~not~~a ~~achieve~~member ~~any~~of ~~revenues~~its ~~(other~~Board ~~than~~of ~~insignificant investment income) until~~Directors, at the ~~earliest~~President/CEO, ~~the~~Secretary, ~~consummation~~Treasurer ~~of a merger~~ and weCFO ~~cannot~~of ~~ascertain~~the ~~our~~Company ~~capital~~replacing ~~requirements~~Michael ~~until~~Zoyes ~~such~~who ~~time.~~resigned ~~There~~as ~~can~~its besole noofficer ~~assurance~~and ~~that~~director. ~~determinations ultimately made by us will permit us to achieve our business objectives~~Mr. ~~Our~~Zoyes ~~auditors~~did ~~have~~not ~~included~~resign anas ~~explanatory~~a ~~paragraph~~result inof ~~their~~any ~~report~~disagreement ~~for~~with the ~~year~~Company ~~ended~~on ~~December~~any ~~30,~~matter ~~2012,~~relating ~~indicating that certain conditions raise substantial doubt regarding our ability~~ to ~~continue~~its asoperations, apolicies ~~going~~or ~~concern~~practices. ~~The~~Mr. ~~financial~~Eccles ~~statements~~served ~~included~~as inthe ~~this~~Company’s ~~annual~~sole ~~report~~officer doand ~~not~~director ~~include~~until ~~any~~January ~~adjustment~~22, to2014 ~~asset~~at ~~values~~which ortime ~~recorded~~the ~~amounts~~Company ofentered ~~liability~~into ~~that might be necessary in~~ the ~~event~~Merger weAgreement ~~are unable to continue~~ as ahereinafter ~~going concern~~discussed. ~~If we are in fact unable to continue as a going concern, shareholders may lose their entire investment in our common stock.~~

WEOn ~~DEPEND~~November ~~SUBSTANTIALLY~~11, ~~UPON~~2013, AThe ~~SINGLE~~Board ~~EXECUTIVE~~of ~~OFFICER~~Directors ~~AND~~and ~~DIRECTOR~~stockholders owning or having voting authority over a majority of the voting capital stock of the Company, ~~WHOSE~~voted ~~EXPERIENCE~~in ISfavor ~~LIMITED~~of an amendment to the Articles of Incorporation to affect a reverse stock split of all of the outstanding shares of Common Stock, TOat ~~MAKES~~a ~~ALL~~ratio ~~MANAGEMENT~~of ~~DECISIONS~~one-for-thirty. The reverse split which was pending per completion of a FINRA review was subsequently cancelled by the Board of Directors on March 13, 2014, as filed on Form 8-K on March 18, 2014.

~~Our~~On ~~ability~~January to22, ~~effect~~2014, athe ~~merger~~Company ~~will~~entered beinto ~~dependent~~an ~~upon~~Agreement ~~the~~of ~~efforts~~Merger and Plan of ~~our~~Reorganization ~~chief~~("Merger ~~executive~~Agreement") ~~officer~~by and ~~sole~~among ~~director,~~the ~~Joe~~Company ~~Eccles~~and the Vapor Group, Inc., ~~Notwithstanding~~a Florida corporation ("Vapor Group") and the ~~importance~~shareholders of ~~Mr.~~Vapor ~~Eccles,~~Group as(the of“Vapor ~~this~~Group ~~time~~Shareholders”), wepursuant ~~have~~to ~~not~~which ~~entered~~the ~~into~~Company ~~any~~will ~~employment~~acquire ~~agreement~~100% orof ~~other~~the ~~understanding~~issued ~~with~~and ~~Mr.~~outstanding ~~Eccles~~shares ~~concerning~~of ~~compensation~~Vapor orGroup ~~obtained~~from ~~any~~the ~~"key~~Vapor ~~man"~~Group ~~life~~Shareholders ~~insurance~~in onreturn ~~his~~for ~~life~~the issuance of 750,000,000 shares of its common stock. ~~The~~As ~~loss~~a condition to be met prior to the closing of the ~~services~~Merger Agreement, the Company was required to increase its authorized shares of ~~Mr.~~common ~~Eccles~~stock ~~will~~to ~~have~~2,000,000,000 afrom ~~material~~500,000,000, ~~adverse~~which ~~effect~~it did by filing an amendment to its Articles of Incorporation with the State of Florida on ~~our~~January ~~business~~10, ~~objectives.~~2014, Wewhich ~~will~~amendment ~~rely~~was ~~upon~~accepted by the ~~expertise~~State of MrFlorida on January 15, 2014 thereby increasing its authorized shares. ~~Eccles~~The ~~and~~Merger weAgreement ~~cannot~~subsequently ~~anticipate~~became ~~that~~effective weas ~~will~~of ~~have~~January ~~the~~27, ~~financial~~2014 ~~means~~with toits ~~hire~~filing ~~additional~~in ~~personnel~~the State of Florida.

~~THERE~~As ISa ~~COMPETITION~~result ~~FOR~~of ~~THOSE~~the ~~PRIVATE~~Merger ~~COMPANIES~~Agreement: ~~SUITABLE~~(i) ~~FOR~~the AVapor ~~MERGER~~Group ~~TRANSACTION~~assumed OFmanagement ~~THE~~control ~~TYPE~~of ~~CONTEMPLATED~~the BYCompany ~~MANAGEMENT~~and established its business model and operations as the primary business operations of the Company; (ii)Joe Eccles resigned as the sole officer and director of the Company; (iii) Dror Svorai consented to act as a member of the Board of Directors, Chairman of the Board of Directors and as the President/Chief Executive Officer, and Treasurer of the Company; (iv) Yaniv Nahon consented to act as a member of the Board of Directors and as a Vice President/Chief Operating Officer, and Secretary of the Company; and (v) Jorge Schcolnik consented to act as a member of the Board of Directors and Vice President/Chief Financial Officer of the Company.

We are in a highly competitive market for a small number of business opportunities which could reduce the likelihood of consummating a successful business combination. We are and will continue to be an insignificant participant in the business of seeking mergers with, joint ventures with and acquisitions of small private and public entities. A large number of established and well-financed entities, including small public companies and venture capital firms, are active in mergers and acquisitions of companies that may be desirable target candidates for us. Nearly all these entities have significantly greater financial resources, technical expertise and managerial capabilities than we do; consequently, we will be at a competitive disadvantage in identifying possible business opportunities and successfully completing a business combination. These competitive factors may reduce the likelihood of our identifying and consummating a successful business combination.7

~~Even~~Mr. ifEccles wedid ~~are~~not ~~able~~resign toas ~~identify business opportunities that our Board deems appropriate, we cannot assure you that such~~ a ~~strategy will provide you with a positive return on your investment, and may in fact~~ result ~~in a substantial decrease in the value~~ of ~~your~~any ~~stock.~~disagreement ~~In addition, if we enter into a combination~~ with athe ~~business~~Company ~~that~~on ~~has~~any ~~operating~~matter ~~income,~~relating ~~we cannot assure you that we will be able~~ to utilize all or even a portion of our existing net operating loss carryover for federal or state tax purposes following such a business combination. If we are unable to make use of our existing net operating loss carryover, the ~~tax~~Company’s ~~advantages of such a combination may be limited~~operations, ~~which~~policies ~~could~~or ~~negatively impact the price of our stock and the value of your investment~~practices. ~~These factors will substantially increase the uncertainty, and thus the risk, of investing in our shares.~~

~~FUTURE~~The ~~SUCCESS~~biographies ISof ~~HIGHLY~~the ~~DEPENDENT~~new ONdirectors ~~THE~~and ~~ABILITY~~officers OFto ~~MANAGEMENT~~be TOelected ~~LOCATE~~and ~~AND~~appointed ~~ATTRACT~~respectively Aare ~~SUITABLE~~set ~~ACQUISITION.~~forth below as follows:

~~The~~Dror ~~nature~~Svorai. Mr. Svorai, President and Chief Executive Officer and Treasurer of ~~our~~the ~~operations~~Vapor Group, Inc., is ~~highly~~a ~~speculative.~~founder ~~The~~in ~~success~~2012 of ~~our~~the ~~plan~~Vapor ofGroup, ~~operation~~Inc., ~~will~~and ~~depend~~its tosubsidiaries, aTotal ~~great~~Vapor ~~extent~~Inc., onVapor 123, Inc. and Vapor Products, Inc. For the past two years he has overseen the day-to-to operations, ~~financial~~of ~~condition~~these companies and ~~management~~managed oftheir steady growth. In the ~~identified~~ten ~~business~~years ~~opportunity~~prior to 2012, Mr. ~~While~~Svorai ~~management~~has ~~intends~~served toin ~~seek~~executive ~~business~~positions, ~~combination(s)~~including ~~with~~president ~~entities~~and ~~having~~chief ~~established~~executive ~~operating~~officer ~~histories~~of several companies, weand ~~cannot~~has ~~assure~~maintained ~~you~~an ~~that~~ongoing weinvolvement ~~will~~in beseveral ~~successful~~private inreal ~~locating~~estate ~~candidates~~ventures. ~~meeting~~Before ~~that~~then, ~~criterion~~Mr. InSvorai ~~the~~also ~~event~~was weinvolved ~~complete~~in investments of real estate, and was a business ~~combination~~owner in the garment industry and the private jet industry. From 1997 until 2001, Mr. Svorai was the ~~success~~founder and chief executive officer of ~~our~~Ocean ~~operations~~Drive ~~may~~of beOrlando. ~~dependent~~From ~~upon~~1998 ~~management~~until of2003, Mr. Svorai was the ~~successor~~founder ~~firm~~and orchief ~~venture~~executive ~~partner~~officer ~~firm~~of ~~and~~Ocean ~~numerous~~Drive ~~other~~Fashion. ~~factors~~From ~~beyond~~2003 ~~our~~until ~~control~~2006 Mr. Svorai was the founder and chief executive officer of the D & D Fashion Group Inc.

7Yaniv Nahon. Mr. Nahon established the first e-cigarette retail business in Southwest Florida in 2008. Since 2008, he has remained focused on the development and marketing of e-cigarettes at both the wholesale and retail levels, owning an operating his own retail businesses. In 2012 he joined Vapor Group as Vice President and Chief Operating Officer having overall responsibility for product development, quality control and the supply chain. Mr. Nahon is also the corporate Secretary of the Vapor Group and a member of its Board of Directors.

WEJorge ~~HAVE~~Schcolnik. NOIn ~~EXISTING~~September ~~AGREEMENT~~2013, ~~FOR~~Mr. ASchcolnik ~~BUSINESS~~became ~~COMBINATION~~Vice ORPresident, ~~OTHER~~Chief ~~TRANSACTION~~Financial Officer and a member of Board of Directors of the Vapor Group. During the past five years, Mr. Schcolnik has been involved in several large international companies. Mr. Schcolnik was one of the founders of Integral Bioenergies Systems SL, a company located in Spain, where he was involved in its restructure and ultimate sale in 2008. Mr. Schcolnik was associated with E-Libro Corp. for which he deployed the digital publishing market in Argentina. He was also associated with the Federal and City of Buenos Aires Government for the company's academic platform. Since 2010, Mr. Schcolnik has been an officer in Advanced Envirotec Corp., Advanced Copisa Environmental Corp. and other environmental remediation companies. Since 1995, Mr. Jorge Schcolnik has also been representing the State of Buenos Aires, Argentina, within the United States in a number of capacities Commencing 1999, Mr. Schcolnik acted as the chief advisor to the Small and Medium Sized Enterprises Secretariat of the Republic of Argentina based in the United States. Mr. Schcolnik held that position until 2001. During 2001, Mr. Schcolnik participated as a co-founder of Enterprise Buenos Aires Corp., which was later transformed into EBA PLC Corp., a company dedicated to the development of power-line communications. EBA PLC Corp. became a prominent company within the power line communications industry as after two years it was sold in a transaction involving several million US Dollars. Mr. Schcolnik was born in Buenos Aires, Argentina, in 1945 and moved to the United States in September 1995.

WeBusiness ~~have no agreement with respect to engaging in a merger with, joint venture with or acquisition~~ of, aVapor private or public entity. No assurances can be given that we will successfully identify and evaluate suitable business opportunities or that we will conclude a business combination. Management has not identified any particular industry or specific business within an industry for evaluation. We cannot guarantee that we will be able to negotiate a business combination on favorable termsGroup, ~~and there is consequently a risk that funds allocated to the purchase of our shares will not be invested in a company with active business operations~~Inc.

~~MANAGEMENT~~The ~~MAY~~principal ~~CHANGE~~business ~~UPON~~of ~~THE~~Vapor ~~CONSUMMATION~~Group, OFInc., Awww.vaporgroup.com, ~~MERGER~~(“Vapor Group”) is in the designing, developing, manufacturing and marketing high quality, vaporizers and e-cigarettes and accessories which use state-of-the-art electronic technology and specially formulated, “Made in the USA” e-liquids, which may or may not contain nicotine. Vapor Group offers a range of products and unique e-liquid flavors that it believes are unmatched in its industry. Its products are marketed under the Vapor Group, Total Vapor, Vapor 123, and Vapor Products brands, each of which is also a wholly-owned subsidiary of the same name. It sells nationwide through distributors, wholesalers and directly to consumers through its own websites and direct response advertising, and also owns as a wholly-owned subsidiary, Total Vapor Opportunities, Inc., a pending franchisor of “Total Vapor” retail stores in the continental U.S. In addition, Vapor Group owns as a wholly-owned subsidiary, VGR Media, Inc., www.vgr-media.com, a full service interactive advertising agency, offering Vapor Group’s products, and more generally customized performance marketing solutions to help marketers of consumer products acquire new customers and maximize their return on investment. VGR Media operates in the U.S. and sells domestically and internationally.

WeVapor doGroup, ~~not~~Inc. ~~anticipate~~and ~~any~~its ~~change~~subsidiaries ofare ~~control~~managed asby wea ~~pursue~~highly ~~acquisitions~~experienced ~~for~~team ~~our~~of ~~lifestyle~~executives ~~growth~~committed ~~strategies~~to responsible business policies and practices, ~~but~~including ~~should~~the wemarketing ~~close~~of aour ~~merger~~products oronly ~~business~~to ~~combination~~those eighteen years of age or older, itnot ismaking ~~possible~~or avoiding claims about our ~~current~~product ~~management~~health ~~will~~benefits, ~~not~~and ~~retain~~fulfilling ~~any~~the ~~control~~requirements orof ~~managerial~~all ~~responsibilities.~~applicable laws and regulations.

~~CURRENT SHAREHOLDERS WILL BE IMMEDIATELY AND SUBSTANTIALLY DILUTED UPON A MERGER OR BUSINESS COMBINATION.~~8

ToITEM the extent that additional shares of common stock are issued in connection with a merger or business combination, our shareholders could experience significant dilution of their respective ownership interests1A. ~~Furthermore,~~RISK the issuance of a substantial number of shares of common stock may adversely affect prevailing market prices, if any, for the common stock and could impair our ability to raise additional capital through the sale of equity securities.FACTORS

~~OUR~~You ~~COMMON~~should ~~STOCK~~carefully ISconsider ~~CLASSIFIED~~the ASrisks Adescribed ~~“PENNY~~below ~~STOCK”~~together ASwith ~~THAT~~all ~~TERM~~of ISthe ~~GENERALLY~~other ~~DEFINED~~information INincluded ~~THE~~in ~~SECURITIES~~this ~~EXCHANGE~~report ~~ACT~~before OFmaking ~~1934,~~an ASinvestment ~~AMENDED,~~decision TOwith ~~MEAN~~regard ~~EQUITY~~to ~~SECURITIES~~our ~~WITH~~securities. AThe ~~PRICE~~statements OFcontained ~~LESS~~in ~~THAN~~or ~~$5.00.~~incorporated ~~OUR~~herein ~~COMMON~~that ~~STOCK~~are ~~WILL~~not BEhistoric ~~SUBJECT~~facts TOare ~~RULES~~forward-looking ~~THAT~~statements ~~IMPOSE~~that ~~SALES~~are ~~PRACTICE~~subject ~~AND~~to ~~DISCLOSURE~~risks ~~REQUIREMENTS~~and ONuncertainties ~~BROKER~~that could cause actual results to differ materially from those set forth in or implied by forward-~~DEALERS~~looking ~~WHO~~statements. ~~ENGAGE~~If INany ~~CERTAIN~~of ~~TRANSACTIONS~~the ~~INVOLVING~~following Arisks ~~PENNY~~actually ~~STOCK~~occurs, our business, financial condition or results of operations could be harmed. In that case, you may lose all or part of your investment.

WeRisks ~~will~~Relating ~~be subject~~ to ~~the~~Our penny stock rules adopted by the Securities and Exchange Commission that require brokers to provide extensive disclosure to its customers prior to executing trades in penny stocks. These disclosure requirements may cause a reduction in the trading activity of our common stock, which in all likelihood would make it difficult for our stockholders to sell their securities.Business

~~Rule~~WE ~~3a51-1~~RELY ofUPON ~~the~~KEY ~~Securities~~MEMBERS ~~Exchange~~OF ~~Act~~OUR ofMANAGEMENT ~~1934~~TEAM ~~establishes~~AND ~~the~~OTHER ~~definition~~KEY ofPERSONNEL aAND ~~“penny~~A ~~stock,”~~LOSS ~~for~~OF ~~purposes~~KEY ~~relevant~~PERSONNEL toCOULD ~~us,~~PREVENT asOR ~~any~~SIGNIFICANTLY ~~equity~~DELAY ~~security~~THE ~~that~~ACHIEVEMENT ~~has~~OF aOUR ~~minimum bid price of less than $5~~GOALS.00 per share or with an exercise price of less than $5.00 per share, subject to a limited number of exceptions which are not available to us. It is likely that our shares will be considered to be penny stocks for the immediately foreseeable future. This classification severely and adversely affects any market liquidity for our common stock.

~~For~~Our ~~any~~success ~~transaction~~will ~~involving~~depend to a ~~penny~~large ~~stock,~~extent ~~unless~~on ~~exempt,~~ the ~~penny~~abilities ~~stock~~and ~~rules~~continued ~~require~~services ~~that~~of akey ~~broker~~members orof ~~dealer~~our ~~approve~~management ateam ~~person’s~~including ~~account~~our ~~for~~President ~~transactions~~and inCEO, ~~penny stocks~~ and ~~the~~Vice ~~broker~~President orand ~~dealer~~COO, ~~receive~~as ~~from~~well ~~the~~as ~~investor~~other akey ~~written~~personnel. ~~agreement~~The toloss ~~the~~of ~~transaction~~these ~~setting~~key ~~forth~~members ~~the identity and quantity~~ of ~~the~~our ~~penny~~management ~~stock~~team toor beother ~~purchased.~~key Inpersonnel ~~order~~could toprevent ~~approve~~or asignificantly ~~person’s~~delay ~~account~~the ~~for~~implementation ~~transactions~~of inour ~~penny~~business ~~stocks~~plan, ~~the~~research ~~broker~~and ordevelopment ~~dealer~~and ~~must~~marketing ~~obtain~~efforts. ~~financial~~If ~~information~~we ~~and~~continue ~~investment~~to ~~experience~~grow, ~~and~~we ~~objectives~~will ofneed ~~the~~to ~~person~~add ~~and~~additional ~~make~~management aand ~~reasonable~~other ~~determination~~personnel. ~~that~~Our ~~the~~success ~~transactions~~will independ ~~penny~~on ~~stocks~~our ~~are~~ability ~~suitable~~to ~~for~~attract ~~that person~~ and ~~that~~retain ~~that~~highly ~~person~~skilled ~~has~~personnel ~~sufficient knowledge~~ and ~~experience~~our inefforts ~~financial matters~~ to beobtain ~~capable~~or ofretain ~~evaluating~~such ~~the~~personnel ~~risks~~may ofnot ~~transactions~~be ~~in penny stocks~~successful.

8WE HAVE LIMITED RESOURCES AND WILL NEED ADDITIONAL FINANCING IN ORDER TO EXECUTE OUR BUSINESS PLAN AND CONTINUE AS A GOING CONCERN.

~~The~~We ~~broker~~have orlimited ~~dealer~~resources ~~must~~and ~~also~~our ~~deliver,~~cash ~~prior~~on hand may not be sufficient to ~~any~~satisfy ~~transaction~~our cash requirements during the next twelve months. The financial statements included in athis ~~penny~~annual ~~stock,~~report ado ~~disclosure~~not ~~schedule~~include ~~prepared~~any byadjustment to asset values or recorded amounts of liability that might be necessary in the ~~SEC~~event ~~relating~~we are unable to ~~the~~continue ~~penny~~as ~~stock~~a ~~market,~~going ~~which,~~concern. If we are in ~~highlight~~fact ~~form~~unable to continue as a going concern, ~~sets~~shareholders ~~forth:~~may lose their entire investment in our common stock.

~~• the~~IF ~~basis~~WE onARE ~~which~~UNABLE ~~the~~TO ~~broker~~MANAGE orANY ~~dealer~~FUTURE ~~made~~GROWTH ~~the~~EFFECTIVELY, ~~suitability~~OUR ~~determination,~~PROFITABILITY ~~and~~AND LIQUIDITY COULD BE ADVERSELY AFFECTED.

~~• that~~Our ~~the~~growth ~~broker~~is orexpected ~~dealer~~to ~~received~~place asignificant ~~signed~~strain on our limited research and development, ~~written~~sales ~~agreement~~and ~~from~~marketing, ~~the~~operational ~~investor~~and ~~prior~~administrative resources. To manage any future growth, we must continue to ~~the~~improve ~~transaction~~our operational and financial systems and expand, train and manage our employee base. We also need to improve our supply chain management and quality control operations and hire and train new employees, including sales and customer service representatives and operations managers. If we are unable to manage our growth effectively, our profitability and liquidity could be adversely affected.

~~Disclosure~~IF ~~also~~OUR ~~has~~DEVELOPED toTECHNOLOGY beOR ~~made~~TECHNOLOGY ~~about~~UNDER ~~the~~DEVELOPMENT ~~risks~~DOES ofNOT ~~investing~~ACHIEVE inMARKET ~~penny stocks in both public offerings and in secondary trading and commissions payable to both the broker-dealer and the registered representative~~ACCEPTANCE, ~~current~~PROSPECTS ~~quotations~~FOR ~~for~~OUR ~~the~~GROWTH ~~securities~~AND ~~and~~PROFITABILITY ~~the~~WOULD ~~rights~~BE ~~and remedies available to an investor in cases of fraud in penny stock transactions~~LIMITED. ~~Finally, monthly statements have to be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stocks.~~

~~OUR~~Our ~~COMMON~~future ~~STOCK~~success ~~HAS~~depends ~~BEEN~~on ~~THINLY~~market ~~TRADED~~acceptance of the technology used in our products and our technology currently under development. Although adoption of e-cigarettes has grown in recent years, ~~LIQUIDITY~~adoption ISof ~~LIMITED~~such products has only recently begun, ~~AND~~is WEstill ~~MAY~~limited BEand ~~UNABLE~~faces TOsignificant ~~OBTAIN~~challenges. ~~LISTING~~Potential OFcustomers ~~OUR~~may ~~COMMON~~be ~~STOCK~~reluctant ONto Aadopt ~~MORE~~e-cigarette ~~LIQUID~~products ~~MARKET~~as an alternative to traditional smoking because of its higher initial cost or perceived risks relating to its novelty, reliability, usefulness, quality and cost-effectiveness when compared to other established smoking products on the market. Changes in economic and market conditions may also affect the marketability of e-cigarette products. Even if e-cigarette products continue to achieve performance improvements and cost reductions, limited customer awareness of their benefits, lack of widely accepted standards governing them and customer unwillingness to adopt their use in favor of entrenched solutions could significantly limit the demand for such products and adversely impact our results of operations.

Our common stock is quoted on the OTC which provides significantly less liquidity than a securities exchange (such as the American or New York Stock Exchange) or an automated quotation system (such as the Nasdaq National Market or SmallCap Market). There is uncertainty that we will ever be accepted for a listing on an automated quotation system or a securities exchange.9

~~Often~~E-CIGARETTE ~~there~~PRODUCTS isARE ~~currently~~SUBJECT aTO ~~limited~~RAPID ~~volume~~TECHNOLOGICAL ~~of trading in our common stock, and on many days there has been no trading activity at all~~CHANGES. ~~The~~IF ~~purchasers~~WE ofFAIL ~~shares~~TO ofACCURATELY ~~our~~ANTICIPATE ~~common~~AND ~~stock~~ADAPT ~~may~~TO ~~find~~THESE itCHANGES, ~~difficult~~THE toPRODUCTS ~~resell~~WE ~~their~~SELL ~~shares~~WILL atBECOME ~~prices~~OBSOLETE, ~~quoted~~CAUSING inA ~~the~~DECLINE ~~market~~IN orOUR atSALES ~~all~~AND PROFITABILITY.

~~Certain~~E-cigarette ~~stockholders~~products ~~control~~are asubject ~~large~~to ~~percentage~~rapid oftechnological ~~our~~changes ~~common~~that ~~stock~~often cause product obsolescence. Companies within the e-cigarette industry are continuously developing new products with heightened performance and ~~Series~~functionality. AThis ~~Preferred~~puts ~~Shares~~pricing pressure on existing products and ~~therefore~~constantly ~~the~~threatens ~~current~~to ~~stockholders~~make ~~will~~them, ~~continue~~or causes them to ~~control~~be, obsolete. If we fail to accurately anticipate the ~~Company,~~introduction ~~and~~of ~~their~~new ~~interests~~technologies, we may possess significant amounts of obsolete inventory that can only be ~~different~~sold ~~from~~at ~~yours~~substantially lower prices and profit margins than we anticipated. In addition, asif awe ~~result~~fail to accurately anticipate the introduction of new technologies or are unable to develop the planned new technologies, ~~you~~we may ~~have~~be nounable ~~effective~~to ~~voice~~compete ineffectively due to our ~~management~~failure to offer products most demanded by the marketplace. If any of these failures occur, our sales, profit margins and profitability will be adversely affected.

~~The~~WE ~~Company’s~~MAY ~~President~~BE ~~and~~SUBJECT ~~CEO~~IN ~~and~~THE ~~certain~~FUTURE ~~other~~TO ~~shareholders~~BURDENSOME ofGOVERNMENTAL ~~the Company will retain control of all the outstanding Common Stock as a result of their ownership of the Series A Preferred Stock, which has super voting rights~~REGULATION.. Accordingly, management will have control of the Company for the foreseeable future and their interests may be different from yours, as a result, the shareholders may have no effective voice in our managing the affairs of the Company.

~~THE~~The ~~COMPANY~~e-cigarette ~~HAS~~industry ~~NOT~~is ~~PAID~~relatively ~~DIVIDENDS~~new and the manufacture and distribution of its products is not currently subject to consistent or significant amounts of governmental regulation. Over time, ~~NOR~~we ~~DOES~~may ITbecome ~~INTEND~~subject TOto burdensome and costly governmental regulation at the municipal, state and federal levels. The cost of compliance with such regulation may be costly, and may negatively impact our future revenues, profits, and the manner in which we distribute and market our products.

~~The~~IF ~~Company~~WE ~~has~~ARE ~~paid~~UNABLE noTO ~~dividends~~INCREASE onPRODUCTION ~~its~~CAPACITY ~~Common~~FOR ~~Stock~~OUR toPRODUCTS ~~date,~~IN ~~and~~A ~~there~~COST ~~are~~EFFECTIVE noAND ~~plans~~TIMELY ~~to pay any in the foreseeable future. Initial earnings which the Company may realize~~MANNER, ifWE ~~any,~~MAY ~~will~~INCUR beDELAYS ~~retained~~IN toSHIPMENT ~~finance~~AND ~~growth~~OUR ofREVENUES ~~the~~AND ~~Company. Any~~REPUTATION ~~future~~IN ~~dividends,~~THE ofMARKETPLACE ~~which~~COULD ~~there~~BE ~~can be no assurance, will be directly dependent upon the earnings of the Company, its financial requirements and other factors~~HARMED.

~~Other~~An ~~Risks~~important part of our business plan is the expansion of production capacity for our products. In order to fulfill anticipated demand for our products, we invest in capacity in advance of actual customer orders, typically based on preliminary, non-binding indications of future demand. As customer demand for our products changes, we must be able to adjust our production capacity to meet demand while keeping costs down. Uncertainty is inherent within our facility and capacity expansion, and unforeseen circumstances could offset the anticipated benefits, disrupt our ability to provide products to our customers and impact product quality.

~~Mergers~~Our ability to successfully increase production capacity in a cost effective and timely manner will depend on a number of factors, including the ~~type~~following: we(i) ~~intend~~our ~~are~~ability ~~often~~to ~~heavily~~transition ~~scrutinized~~production byin our manufacturing facility; (ii) the ~~SEC~~ability ~~and~~of wecontract ~~may~~manufacturers ~~encounter~~to ~~difficulties~~allocate more of their existing capacity to us or ~~delays~~their inability ~~obtaining~~to add new capacity quickly; (iii) the ability of any future ~~regulatory~~contract ~~approvals~~manufacturers ~~which~~to ~~would~~successfully ~~negatively~~implement ~~impact~~our manufacturing processes; (iv) the availability of critical components and subsystems used in the manufacture of our products; (v) our ability to effectively establish adequate management information systems, financial ~~condition~~controls and ~~the~~supply ~~value~~chain management and ~~liquidity~~quality ofcontrol ~~your~~procedures; ~~shares~~and (vi) the occurrence of ~~common~~equipment ~~stock~~failures, power outages, environmental risks or variations in the manufacturing process.

OnIf ~~June~~we ~~29,~~are ~~2005,~~unable ~~the~~to ~~SEC~~increase ~~adopted~~production ~~rules~~capacity ~~dealing~~for ~~with~~our ~~private~~products ~~company~~in ~~mergers~~a ~~into~~cost ~~dormant~~effective orand ~~inactive~~timely ~~public~~manner ~~companies.~~while Asmaintaining aadequate ~~result~~quality, itwe ismay ~~likely~~incur ~~that~~delays wein ~~will~~shipment or be ~~scrutinized~~unable ~~carefully~~to bymeet ~~the~~increased ~~SEC~~demand ~~and~~for ~~possibly~~our byproducts ~~the~~which ~~Financial~~could ~~Industry~~harm ~~Regulatory~~our ~~Authority~~revenues ~~(“FINRA”)~~and ~~which~~operating ~~could~~margins ~~result~~and indamage ~~difficulties~~our orreputation ~~delays~~and inour ~~achieving~~relationships ~~SEC~~with ~~clearance~~current ofand ~~any~~prospective ~~future~~customers. ~~registration~~Conversely, ~~statements~~due orto ~~other~~the ~~SEC~~proportionately ~~filings~~high ~~that~~fixed wecost ~~may~~nature ~~pursue,~~of inour ~~attracting~~business ~~FINRA-member~~(such ~~broker-dealers~~as tofacility ~~serve~~expansion ascosts), ~~market-makers~~if indemand ~~our~~does ~~common~~not ~~stock,~~increase orat inthe ~~achieving~~rate ~~admission~~forecasted, towe ~~one~~may ofnot ~~the~~be ~~Nasdaq~~able ~~stock~~to ~~markets~~reduce ormanufacturing ~~any~~expenses ~~other~~or ~~national~~overhead ~~securities~~costs ~~market.~~at Asthe asame ~~consequence,~~rate ~~our~~as ~~financial~~demand ~~condition~~decreases, ~~and~~which ~~the~~could ~~value~~also ~~and~~result ~~liquidity~~in oflower ~~your~~margins ~~shares~~and ofadversely impact our ~~common~~business ~~stock~~and ~~may~~results beof ~~negatively impacted~~operations.

910

~~THE~~WE ~~ELIMINATION~~INTEND OFTO ~~MONETARY~~ASSEMBLE ~~LIABILITY AGAINST OUR DIRECTORS, OFFICERS~~ AND ~~EMPLOYEES~~MANUFACTURE ~~UNDER~~CERTAIN ~~FLORIDA LAW AND THE EXISTENCE~~ OF ~~INDEMNIFICATION~~OUR ~~RIGHTS~~PRODUCTS TOAND OUR ~~DIRECTORS~~SALES, ~~OFFICERS~~RESULTS ~~AND~~OF ~~EMPLOYEES~~OPERATIONS ~~MAY~~AND ~~RESULT~~REPUTATION INCOULD ~~SUBSTANTIAL~~BE ~~EXPENDITURES~~MATERIALLY BYADVERSELY USAFFECTED ~~AND~~IF ~~MAY~~THERE ~~DISCOURAGE~~IS ~~LAWSUITS~~A ~~AGAINST~~DISRUPTION AT OUR ~~DIRECTORS,~~ASSEMBLY ~~OFFICERS~~ AND ~~EMPLOYEES~~MANUFACTURING FACILITY.

Our ~~Bylaws~~assembly ~~contain~~and ~~specific~~manufacturing ~~provisions~~operations ~~that~~for ~~eliminate~~our ~~the~~products ~~liability~~is based in Davie, Florida. The operation of ~~our~~this ~~directors~~facility ~~for~~involves ~~monetary~~many ~~damages~~risks, toincluding ~~our~~equipment ~~company~~failures, ~~and~~natural ~~shareholders~~disasters, ~~and~~industrial weaccidents, ~~are~~power ~~prepared~~outages toand ~~give~~other ~~such~~business ~~indemnification~~interruptions. toWe ~~our~~could ~~directors~~incur ~~and~~significant ~~officers~~costs to ~~the~~maintain ~~extent~~compliance ~~provided~~with, byor ~~Florida~~due ~~law.~~to Weliabilities ~~may~~under, ~~also~~environmental ~~have~~laws ~~contractual~~and ~~indemnification~~regulations, ~~obligations~~the ~~under~~violation ~~our~~of ~~employment~~which ~~agreements~~could ~~with~~lead ~~our~~to ~~officers~~significant fines and penalties. ~~The~~Although ~~foregoing~~we ~~indemnification~~intend ~~obligations~~to ~~could~~carry ~~result~~business ininterruption ~~our~~insurance ~~company~~and ~~incurring~~third-party ~~substantial~~liability ~~expenditures~~insurance to cover ~~the~~certain ~~cost~~claims in respect of ~~settlement~~personal injury or property or environmental damage ~~awards~~arising ~~against~~from ~~directors~~accidents ~~and~~on ~~officers~~our properties or relating to our operations, ~~which~~any weexisting insurance coverage may not be ~~unable~~sufficient to ~~recoup.~~cover ~~These~~all ~~provisions~~risks ~~and~~associated ~~resultant~~with ~~costs~~our business. As a result, we may ~~also~~be ~~discourage~~required ~~our~~to ~~company~~pay ~~from~~for ~~bringing~~financial aand ~~lawsuit~~other ~~against~~losses, ~~directors~~damages and ~~officers~~liabilities, ~~for~~including ~~breaches~~those ofcaused ~~their~~by ~~fiduciary~~natural ~~duties,~~disasters and ~~may~~other ~~similarly~~events ~~discourage~~beyond ~~the~~our ~~filing~~control, out of ~~derivative~~our ~~litigation~~own byfunds, ~~our~~which ~~shareholders~~could ~~against~~have a material adverse effect on our ~~directors~~business, ~~and~~financial ~~officers~~condition ~~even~~and ~~though~~results ~~such~~of ~~actions~~operations. Additionally, ifany ~~successful~~interruption in our ability to assemble, ~~might~~manufacture ~~otherwise~~or ~~benefit~~distribute our ~~company~~products could result in lost sales, limited revenue growth and ~~shareholders~~damage to our reputation in the market, all of which would adversely affect our business.

~~FUTURE~~Additionally, ~~SALES~~we OFintend ~~SHARES~~to OFrely ~~OUR~~on ~~COMMON~~arrangements ~~STOCK~~with ~~MAY~~independent ~~DECREASE~~shipping ~~THE~~companies, ~~PRICE~~such ~~FOR~~as ~~SUCH~~United ~~SHARES~~Parcel Service, Inc. and Federal Express Corp., for the delivery of certain components and subsystems from vendors and products to our customers in both the United States and abroad. The failure or inability of these shipping companies to deliver components, subsystems or products timely, or the unavailability of their shipping services, even temporarily, could have a material adverse effect on our business. We may also be adversely affected by an increase in freight surcharges due to rising fuel costs or added security.

~~Actual~~WE ~~sales,~~MAY orUTILIZE ~~the~~A ~~prospect~~CONTRACT ofMANUFACTURER ~~sales~~TO byMANUFACTURE ~~our~~CERTAIN ~~shareholders,~~OF ~~may~~OUR ~~have~~PRODUCTS aAND ~~negative~~ANY ~~effect~~DISRUPTION onIN ~~the~~THIS ~~market~~RELATIONSHIP ~~price~~MAY ofCAUSE ~~the~~US ~~shares~~TO ofFAIL ~~our~~TO ~~common~~MEET ~~stock.~~OUR WeCUSTOMERS’ ~~may~~DEMANDS ~~also~~AND ~~register~~MAY ~~certain~~DAMAGE ~~shares~~OUR ofCUSTOMER ~~our common stock that are subject to outstanding convertible securities, if any, or reserved for issuance under our stock option plans, if any~~RELATIONSHIPS. Once such shares are registered, they can be freely sold in the public market upon exercise of the options. If any of our shareholders either individually or in the aggregate causes a large number of securities to be sold in the public market, or if the market perceives that these holders intend to sell a large number of securities, such sales or anticipated sales could result in a substantial reduction in the trading price of shares of our common stock and could also impede our ability to raise future capital.

~~OUR~~Although ~~COMMON~~we ~~STOCK~~intend ~~WILL~~to BEassemble ~~SUBJECT~~and TOmanufacture ~~PRICE~~certain ~~VOLATILITY~~of ~~UNRELATED~~our TOproducts, ~~OUR~~we ~~OPERATIONS~~may depend on a third party contract manufacturer to manufacture a portion of our products elsewhere. This manufacturer will need to provide the necessary facilities and labor to manufacture these products, which may be primarily high volume products. Our reliance on a contract manufacturer involves certain risks, including the following: (i) lack of direct control over production capacity and delivery schedules; (ii) risk of equipment failures, natural disasters, industrial accidents, power outages and other business interruptions; (iii) lack of direct control over quality assurance and manufacturing yield; and (iv) risk of loss of inventory while in transit.

~~The~~If ~~market~~a ~~price~~potential ofcontract ~~our~~manufacturer ~~common~~were ~~stock~~to ~~could~~terminate ~~fluctuate~~its ~~substantially~~arrangements ~~due~~with tous aor ~~variety~~fail ofto ~~factors,~~provide ~~including~~the ~~market~~required ~~perception~~capacity ofand ~~our~~quality ~~ability~~on toa ~~achieve~~timely ~~our planned growth~~basis, ~~quarterly~~we ~~operating~~would ~~results~~experience ofdelays ~~other companies~~ in the ~~same~~manufacture ~~industry,~~and ~~trading~~shipment ~~volume~~of in our ~~common~~products ~~stock,~~until ~~changes~~alternative inmanufacturing ~~general~~services ~~conditions~~could inbe ~~the~~contracted ~~economy~~or ~~and~~offsetting ~~the~~internal ~~financial~~manufacturing ~~markets~~processes orcould ~~other~~be ~~developments~~implemented. ~~affecting~~Any ~~our~~significant ~~competitors~~shortages or interruption may cause us. Into ~~addition,~~be ~~the~~unable ~~stock~~to ~~market~~timely isdeliver ~~subject~~sufficient quantities of our products to ~~extreme~~satisfy ~~price~~our contractual obligations and ~~volume~~particular ~~fluctuations~~revenue expectations. ~~This~~Moreover, ~~volatility~~even ~~has~~if ~~had~~we atimely ~~significant~~locate ~~effect~~substitute onproducts ~~the~~and ~~market~~their price ofmaterially ~~securities~~exceeds ~~issued~~the byoriginal ~~many~~expected ~~companies~~cost ~~for~~of ~~reasons~~such ~~unrelated~~products, tothen ~~their~~our ~~operating~~margins ~~performance~~ and ~~could~~results ~~have~~of ~~the~~operations ~~same~~would ~~effect~~be onadversely ~~our common stock~~affected.

~~EMPLOYEES~~To qualify a contract manufacturer, familiarize it with our products, quality standards and other requirements and commence volume production may be a costly and time-consuming process. If we are required to choose a contract manufacturers for any reason, our revenue, gross margins and customer relationships could be adversely affected.

~~We currently have no employees, aside from our sole director, CEO and CFO.~~11

~~BANKRUPTCY~~OUR ~~PROCEEDINGS~~INDUSTRY ~~DURING~~IS ~~THE~~HIGHLY ~~PAST~~COMPETITIVE ~~FIVE~~AND ~~YEARS~~IF WE ARE NOT ABLE TO COMPETE EFFECTIVELY, INCLUDING AGAINST LARGER E-CIGARETTE MANUFACTURERS WITH GREATER RESOURCES, OUR PROSPECTS FOR FUTURE SUCCESS WILL BE JEOPARDIZED.

Our ~~Company~~industry ~~has~~is ~~not~~highly ~~been~~competitive. ~~involved~~We inface ~~any~~competition ~~bankruptcy,~~from ~~receivership~~both ortraditional ~~any~~smoking ~~similar~~technologies ~~proceeding,~~provided ~~and,~~by ~~except~~numerous vendors as ~~set~~well ~~forth~~as ~~herein,~~from wee-cigarette ~~have~~products ~~not~~provided ~~had~~by ora ~~been~~growing aroster ~~party~~of toindustry ~~any~~participants. ~~material~~The ~~reclassifications~~e-cigarette industry is characterized by rapid technological change, ~~mergers~~short orproduct ~~consolidations~~lifecycles ~~during~~and frequent new product introductions, and a competitive pricing environment. These characteristics increase the ~~previous~~need ~~five~~for ~~(5)~~continual ~~years~~innovation and provide entry points for new competitors as well as opportunities for rapid market share shifts.

~~DOMAIN~~Currently, ~~NAMES~~we view our primary competition to be from large, established companies in the traditional e-cigarette ~~None~~industry. Certain of these companies also provide, or have undertaken initiatives to develop, e-cigarette products as well as other similar or related products. Additionally, we face competition from a fragmented universe of smaller niche or low-cost offshore providers of e-cigarette products. We also anticipate that larger e-cigarette manufacturers may seek to compete with us by introducing products similar to ours.

~~MAJOR~~Some ~~CUSTOMERS~~of our current and future competitors are larger companies with greater resources to devote to research and development, manufacturing and marketing, as well as greater brand name recognition. Some of our more diversified competitors could also compete more aggressively with us by subsidizing losses in their e-cigarette ~~None~~businesses with profits from other lines of business. Moreover, if one or more of our competitors or suppliers were to merge with one another, the change in the competitive landscape could adversely affect our customer, channel or supplier relationships, or our competitive position. Additionally, any loss of a key channel partner, whether to a competitor or otherwise, could severely and rapidly damage our competitive position. To the extent that competition in our markets intensifies, we may be required to reduce our prices in order to remain competitive. If we do not compete effectively, or if we reduce our prices without making commensurate reductions in our costs, our net sales and profitability, and our future prospects for success, may be harmed.

10IF WE DO NOT PROPERLY ANTICIPATE THE NEED FOR CRITICAL RAW MATERIALS AND COMPONENTS, WE MAY BE UNABLE TO MEET THE DEMANDS OF OUR CUSTOMERS, WHICH COULD REDUCE OUR COMPETITIVENESS, CAUSE A DECLINE IN OUR MARKET SHARE AND HAVE A MATERIAL ADVERSE EFFECT ON OUR RESULTS OF OPERATIONS.

~~RESEARCH~~We ~~AND~~depend ~~DEVELOPMENT~~on ~~ACTIVITIES~~our suppliers for certain standard components as well as custom components critical to the manufacture of our products. We currently rely on a select number of suppliers for the components, including “e-liquids”, used in the production of our products. We depend on our vendors to supply such materials in a timely manner in adequate quantities and consistent quality and at reasonable costs. Should any of our suppliers be unable to fulfill an order for us, finding a suitable alternative supply of the required component that meets our strict specifications and obtaining them in needed quantities may be a time-consuming process, and we may not be able to find an adequate alternative source of supply at an acceptable cost. Any significant interruption in the supply of these raw materials and components could have a material adverse effect on our results of operations.

~~The~~OUR ~~Company~~FINANCIAL ~~has~~RESULTS ~~not~~MAY ~~performed~~VARY ~~any~~SIGNIFICANTLY ~~customer~~FROM PERIOD-~~sponsored~~TO-PERIOD ~~research~~DUE ~~and~~TO ~~development~~UNPREDICTABLE ~~activities~~SALES ~~relating~~CYCLES toIN ~~any~~CERTAIN ~~new~~OF ~~products~~THE orMARKETS ~~services~~INTO ~~during~~WHICH ~~2011~~WE orSELL ~~2012~~OUR PRODUCTS, AND CHANGES IN THE MIX OF PRODUCTS WE SELL DURING A PERIOD, WHICH MAY LEAD TO VOLATILITY IN OUR STOCK PRICE.

~~ENVIRONMENTAL~~The ~~LAWS~~size and timing of our potential revenue from sales to our customers is difficult to predict and is market dependent. Our sales efforts will often require us to educate our customers about the use and benefits of our products, including their technical and performance characteristics. We intend to spend substantial amounts of time and money on our sales efforts and there is no assurance that these investments will produce any sales within expected time frames or at all. Given the potentially large size of purchase orders for our products, particularly in the retail distribution market, the loss of or delay in the signing of a customer order could significantly reduce our revenue in any period. Our revenues in each period may also vary significantly as a result of purchases, or lack thereof, by potential significant customers. Because most of our operating and capital expenses will be incurred based on the estimated number of product purchases and their timing, they are difficult to adjust in the short term. As a result, if our revenue falls below our expectations or is delayed in any period, we may not be able to proportionately reduce our operating expenses or manufacturing costs for that period, and any reduction of manufacturing capacity could have long-term implications on our ability to accommodate future demand.

We do not handle, store or transport hazardous materials or waste products. We abide by all applicable federal, state and local laws and regulations governing the use, manufacture, storage, handling and disposal of hazardous materials and waste products. We do not anticipate the cost of complying with these laws and regulations to be material.12

~~ITEM~~Our 1Bprofitability from period-to-period may also vary significantly due to the mix of products that we may sell in different periods. ~~UNRESOLVED~~ ~~STAFF~~Consequently, ~~COMMENTS~~sales of individual products may not necessarily be consistent across periods, which could affect product mix and cause gross and operating profits to vary significantly. As a result of these factors, we believe that quarter-to-quarter comparisons of our operating results cannot necessarily be relied upon to be meaningful and that these comparisons cannot be relied upon as indicators of future performance.

~~None~~OUR PRODUCTS MAY CONTAIN DEFECTS THAT COULD REDUCE SALES, RESULT IN COSTS ASSOCIATED WITH THE RECALL OF THOSE ITEMS AND RESULT IN CLAIMS AGAINST US.

~~ITEM~~The 2manufacture of our products involves highly complex processes. ~~PROPERTIES~~ Despite testing by us and our customers, defects have been and could be found in our existing or future products. These defects may cause us to incur significant warranty, support and repair costs, and costs associated with recall may divert the attention of our engineering personnel from our product development efforts and harm our relationships with customers and our reputation in the marketplace. We generally provide lifetime warranty on our products, and such warranty may require us to repair, replace or reimburse the purchaser for the purchase price of the product, at the customer’s discretion. Moreover, even if our products meet standard specifications, our customers may attempt to use our products in applications they were not designed for, resulting in product failures and creating customer dissatisfaction. These problems could result in, among other things, a delay in the recognition or loss of revenues, loss of market share or failure to achieve market acceptance. Defects, integration issues or other performance problems in our products could also result in personal injury or financial or other damages to our customers for which they might seek legal recourse against us. We may be the target of product liability lawsuits and could suffer losses from a significant product liability judgment against us if the use of our products at issue is determined to have caused injury. A significant product recall or product liability case could also result in adverse publicity, damage to our reputation and a loss of customer confidence in our products and adversely affect our results of operations.

~~Office~~IF ~~Locations~~WE ARE UNABLE TO OBTAIN AND PROTECT OUR INTELLECTUAL PROPERTY RIGHTS, OUR ABILITY TO COMMERCIALIZE OUR PRODUCTS COULD BE SUBSTANTIALLY LIMITED.

WeAs ~~maintain~~of ~~our~~the ~~principal~~date ~~offices~~of atthis ~~10778~~Annual NWReport, ~~53rd~~we ~~Street~~have filed for the registration and protection of certain trademarks in the U.S. Our applications may not be granted. Because trademarks involve complex legal, ~~Suite~~technical Eand factual questions, ~~Sunrise~~the ~~Florida~~issuance, ~~33352~~scope, validity and enforceability of them cannot be predicted with certainty. ~~The~~ ~~Company~~Competitors ~~occupies~~may andevelop ~~executive~~products ~~office~~similar to our products that do not conflict with our trademark rights. Others may challenge our trademarks and, as a result, any of ~~500~~our ~~square~~trademarks ~~feet~~could be narrowed or invalidated. In some cases, we may rely on confidentiality agreements or trade secret protections to protect our proprietary technology. Such agreements, however, may not be honored and ~~pays~~particular aelements ~~monthly~~of ~~rent~~our proprietary technologies may not qualify as protectable trade secrets under applicable law. In addition, others may independently develop similar or superior technology, and in the absence of ~~$917~~applicable prior patents, we would have no recourse against them.

~~ITEM~~OUR ~~3. LEGAL~~BUSINESS ~~PROCEEDINGS~~MAY BE IMPAIRED BY CLAIMS THAT WE, OR OUR CUSTOMERS, INFRINGE INTELLECTUAL PROPERTY RIGHTS OF OTHERS.

~~There~~Our ~~are~~industry nois ~~pending~~characterized ~~legal~~by vigorous protection and pursuit of intellectual property rights. These traits may result in significant and often protracted and expensive litigation. In addition, we may inadvertently infringe on patents or ~~governmental~~rights ~~proceedings~~owned ~~relating~~by others and licenses might not be available to ~~our~~us ~~Company~~on reasonable or acceptable terms or at all. Litigation to ~~which~~determine wethe ~~are~~validity aof ~~party~~patents, trademarks or claims by third parties of infringement of patents, trademarks or other intellectual property rights could result in significant legal expense and todivert the efforts of our ~~knowledge~~personnel and management, ~~there~~even ~~are~~if nothe ~~material~~litigation ~~proceedings~~results in a determination favorable to ~~which~~us. ~~any~~Third ofparties have and may in the future attempt to assert infringement claims against us, or our ~~directors~~wholesale customers, ~~executive~~with ~~officers~~respect orto ~~affiliates~~our ~~are~~products. aIn ~~party~~the event of an adverse result in such litigation, we could be required to uspay substantial damages; stop the manufacture, use and sale of products found to be infringing; incur asset impairment charges; discontinue the use of processes found to be infringing; expend significant resources to develop non-infringing products or ~~which~~processes; ~~have~~or obtain a ~~material~~license ~~interest~~to use third party technology and whether or not the result is adverse to us, we may have to indemnify our wholesale customers if they were brought into the litigation.

~~ITEM 4. MINE SAFETY DISCLOSURE.~~13

~~Not~~FAILURE ~~applicable~~TO ACHIEVE AND MAINTAIN EFFECTIVE INTERNAL CONTROLS COULD HAVE A MATERIAL ADVERSE EFFECT ON OUR OPERATIONS AND OUR STOCK PRICE.

11We are subject to Section 404 of the Sarbanes-Oxley Act of 2002, which requires an annual management assessment of the effectiveness of our internal control over financial reporting. Effective internal controls are necessary for us to produce reliable financial reports, and failure to achieve and maintain effective internal controls over financial reporting could cause investors to lose confidence in our operating results, and could have a material adverse effect on our business and on the price of our common stock. Because of our status as a smaller reporting company registrant as defined in Rule 12b-2 of the Securities Exchange Act of 1934, as amended, or the Exchange Act, the independent registered public accounting firm auditing our financial statements has not been required to attest to, and report on, the effectiveness of our internal control over financial reporting.

~~PART~~IF IIWE ARE UNABLE TO ATTRACT, HIRE AND RETAIN QUALIFIED SALES AND MANAGEMENT PERSONNEL, THE COMMERCIAL OPPORTUNITY FOR OUR PRODUCTS AND SERVICES MAY BE DIMINISHED.

~~ITEM~~Currently, 5our sales force consists of three full-time sales representatives. ~~MARKET~~ ~~FOR~~We ~~REGISTRANT’S~~may ~~COMMON~~not ~~EQUITY~~be able to attract, ~~RELATED~~hire, ~~STOCKHOLDER~~train ~~MATTERS~~and ~~AND~~retain ~~ISSUER~~qualified ~~PURCHASES~~sales OFand ~~EQUITY~~sales ~~SECURITIES~~management personnel. If we are not successful in our efforts to maintain and grow a qualified sales force, our ability to independently market and promote our products may be impaired. In such an event, we would likely need to establish collaboration, co-promotion, distribution or other similar arrangement to market and sell our products. However, we might not be able to enter into such an arrangement on favorable terms, if at all. Even if we are able to effectively maintain a qualified sales force, our sales force may not be successful in commercializing our products and services.

AsIF ofWE ~~the~~FAIL ~~date~~TO ofATTRACT ~~this~~AND ~~Annual~~RETAIN ~~Report,~~KEY ~~the Company's Common Stock is quoted on the Over-the-Counter Pink-Sheets under the symbol "SPLI." The market for the Company's Common Stock is limited~~PERSONNEL, ~~volatile~~OR ~~and~~TO ~~sporadic~~RETAIN ~~and~~OUR ~~the~~EXECUTIVE ~~price~~MANAGEMENT ~~of the Company's Common Stock could be subject to wide fluctuations in response to quarterly variations in operating results~~TEAM, ~~news~~WE ~~announcements,~~MAY ~~trading~~BE ~~volume,~~UNABLE ~~sales~~TO ofSUCCESSFULLY ~~Common~~DEVELOP ~~Stock~~OR byCOMMERCIALIZE ~~officers,~~OUR ~~directors and principal shareholders of the Company, general market trends, changes in the supply and demand for the Company's shares, and other factors~~PRODUCTS. The following table sets forth the high and low sales prices for each quarter relating to the Company's Common Stock for the last two fiscal years. These quotations reflect inter-dealer prices without retail mark-up, markdown, or commissions, and may not reflect actual transactions.

Fiscal 2011	High		Low
First Quarter		N/A		N/A
Second Quarter	" "		" "
Third Quarter	" "		" "
Fourth Quarter		0.1499		0.0800

Our success depends in part on our continued ability to attract, retain and motivate highly qualified managerial personnel. We are highly dependent upon our executive management team. The loss of the services of any one or more of the members of our executive management team could delay or prevent the successful completion of some of our development and commercialization objectives.

Fiscal 2012	High		Low
First Quarter		0.2100		0.0040
Second Quarter		0.0079		0.0021
Third Quarter		0.0039		0.0002
Fourth Quarter		0.0038		0.0006

Recruiting and retaining qualified sales and marketing personnel is critical to our success. We may not be able to attract and retain these personnel on acceptable terms given the competition among numerous pharmaceutical and biotechnology companies for similar personnel. In addition, we rely on consultants and advisors, including scientific and clinical advisors, to assist us in formulating our development and commercialization strategy. Our consultants and advisors may also be employed by companies and may have commitments under consulting or advisory contracts with other entities that may limit their availability to us.

~~Description~~IF ofTHE ~~Securities~~ESTIMATES THAT WE MAKE, OR THE ASSUMPTIONS UPON WHICH WE RELY, IN PREPARING OUR FINANCIAL STATEMENTS PROVE INACCURATE, OUR FUTURE FINANCIAL RESULTS MAY VARY FROM EXPECTATIONS.

Our ~~authorized~~financial ~~capital~~statements ~~stock~~have ~~consists~~been prepared in accordance with accounting principles generally accepted in the United States. The preparation of ~~500,000,000~~our ~~shares~~financial statements requires us to make estimates and judgments that affect the reported amounts of ~~common~~our ~~stock~~assets, ~~par~~liabilities, ~~value~~stockholders’ ~~$0.001~~equity, ~~per~~revenues ~~share~~and expenses, the amounts of charges accrued by us and ~~10,000,000~~related ~~shares~~disclosure of ~~preferred~~contingent ~~stock,~~assets $0and liabilities.~~001~~ ~~par~~We ~~value~~base ~~per~~our ~~share~~estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. As ofWe ~~January~~cannot 8assure you, ~~2013~~therefore, anthat ~~aggregate~~there ofmay ~~270,020,145 shares~~not ofbe ~~our~~material ~~common~~fluctuations ~~stock~~between ~~were~~our ~~issued~~estimates and ~~outstanding~~the actual results.

Common Stock. Each outstanding share of common stock entitles the holder thereof to one vote per share on all matters. Stockholders do not have preemptive rights to purchase shares in any future issuance of our common stock. Upon our liquidation, dissolution or winding up, and after payment of creditors and preferred stockholders, if any, our assets will be divided pro-rata on a share-for-share basis among the holders of the shares of common stock.14

~~The~~THE ~~holders~~CURRENT ofGLOBAL ~~shares~~ECONOMIC ofDOWNTURN ~~our~~OR ~~common~~RECESSION ~~stock~~MAY ~~are~~NEGATIVELY ~~entitled~~AFFECT toOUR ~~dividends out of funds legally available when and as declared by our board of directors~~BUSINESS. Our board of directors has never declared a cash dividend and does not anticipate declaring any dividend in the foreseeable future. Should we decide in the future to pay dividends, as a holding company, our ability to do so and meet other obligations depends upon the receipt of dividends or other payments from our operating subsidiaries and other holdings and investments. In addition, our operating subsidiaries, from time to time, may be subject to restrictions on their ability to make distributions to us, including as a result of restrictive covenants in loan agreements, restrictions on the conversion of local currency into U.S. dollars or other hard currency and other regulatory restrictions. In the event of our liquidation, dissolution or winding up, holders of our common stock are entitled to receive, ratably, the net assets available to stockholders after payment of all creditors and preferred stockholders.

12The current global economic downturn or recession could negatively affect our sales because many consumers consider the purchase of our products and services as discretionary. We cannot predict the timing or duration of the economic slowdown or recession or the timing or strength of a subsequent recovery, worldwide, or in the specific end markets we serve. If the market for our products and services significantly deteriorates due to the economic situation, our business, financial condition or results of operations could be materially and adversely affected.

~~Preferred~~Risks ~~Stock.~~Related ~~Our~~To Articles of Incorporation also provide that we are authorized to issue up to 10,000,000 shares of preferred stock with a par value of $.001 per share. As of the date of this report, there are 1,000,000 shares of Series A Preferred Stock issued and outstanding. Our ~~Board~~Common of Directors has the authority, without further action by the shareholders, to issue from time to time the preferred stock in one or more series for such consideration and with such relative rights, privileges, preferences and restrictions that the Board may determine. The preferences, powers, rights and restrictions of different series of preferred stock may differ with respect to dividend rates, amounts payable on liquidation, voting rights, conversion rights, redemption provisions, sinking fund provisions and purchase funds and other matters. The issuance of preferred stock could adversely affect the voting power or other rights of the holders of common stock.Stock

~~Series~~OUR ACOMMON ~~Preferred~~STOCK ~~Stock.~~IS ~~There~~CLASSIFIED ~~are~~AS ~~1,000,000 shares of preferred stock designated as Series~~ A ~~Preferred~~“PENNY ~~Stock.~~STOCK” ~~Each~~AS ~~share~~THAT ofTERM ~~Series~~IS AGENERALLY ~~Preferred~~DEFINED ~~Stock~~IN ~~shall~~THE ~~have~~SECURITIES aEXCHANGE ~~par~~ACT ~~value~~OF of $.001 per share and a stated value equal to $.001. The Holders of outstanding Series A Preferred Stock shall be entitled to participate in any dividends declared on the Corporation’s common stock .In addition to voting as a class as to all matters that require class voting under the Florida Business Corporation Act1934, ~~the~~AS ~~Holders of the Series A Preferred Stock shall vote on all matters with the holders of the Common Stock (and not as a separate class) on ten thousand votes per share (10~~AMENDED,~~000:1)~~ ~~basis. The~~TO ~~Holders~~MEAN ofEQUITY ~~the~~SECURITIES ~~Series~~WITH A ~~Preferred~~PRICE ~~Stock~~OF ~~shall~~LESS beTHAN entitled to receive all notices relating to voting as are required to be given to the holders of the Common Stock. The Series A Preferred Stock shall, with respect to rights on liquidation, rank equivalent to all classes of the common stock, $5.~~0001 par value per share (collectively, the "Common Stock" or "Common Shares"), of the Corporation~~00. ~~Shares~~ ofOUR ~~Series~~COMMON ASTOCK ~~Preferred~~WILL ~~Stock~~BE ~~may~~SUBJECT ~~not~~TO beRULES ~~redeemed~~THAT byIMPOSE ~~the~~SALES ~~Corporation.~~PRACTICE ~~Each~~AND ~~share~~DISCLOSURE ofREQUIREMENTS ~~Series~~ON ABROKER-DEALERS ~~Preferred~~WHO ~~Stock~~ENGAGE ~~shall~~IN beCERTAIN ~~convertible,~~TRANSACTIONS ~~without~~INVOLVING ~~the payment of any additional consideration by the holder thereof and at the option of the holder thereof, at any time after the Series~~ A ~~Issue~~PENNY ~~Date at the conversion ratio of one (1) share of Series A Preferred Stock for one thousand (1,000) shares of Common Stock~~STOCK.

~~Holders~~We will be subject to the penny stock rules adopted by the Securities and Exchange Commission that require brokers to provide extensive disclosure to its customers prior to executing trades in penny stocks. These disclosure requirements may cause a reduction in the trading activity of our common stock, which in all likelihood would make it difficult for our stockholders to sell their securities.

AsRule 3a51-1 of ~~January~~the 8Securities Exchange Act of 1934 establishes the definition of a “penny stock,” ~~2013~~for purposes relevant to us, ~~there~~ ~~are~~as ~~approximately~~any 75equity ~~shareholders~~security that has a minimum bid price of less than $5.00 per share or with an exercise price of less than $5.00 per share, subject to a limited number of exceptions which are not available to us. It is likely that our shares will be considered to be penny stocks for the immediately foreseeable future. This classification severely and adversely affects any market liquidity for our common stock.

~~Transfer~~For ~~Agent~~any transaction involving a penny stock, unless exempt, the penny stock rules require that a broker or dealer approve a person’s account for transactions in penny stocks and ~~Registrar~~the broker or dealer receive from the investor a written agreement to the transaction setting forth the identity and quantity of the penny stock to be purchased. In order to approve a person’s account for transactions in penny stocks, the broker or dealer must obtain financial information and investment experience and objectives of the person and make a reasonable determination that the transactions in penny stocks are suitable for that person and that that person has sufficient knowledge and experience in financial matters to be capable of evaluating the risks of transactions in penny stocks.

~~Interwest~~The ~~Transfer~~broker ~~Co.~~or isdealer ~~currently~~must ~~the~~also ~~transfer~~deliver, ~~agent~~prior ~~and~~to ~~registrar~~any ~~for~~transaction ~~our~~in ~~common~~a penny stock, ~~Its~~a ~~address~~disclosure isschedule ~~1981~~prepared ~~Murray~~by ~~Holladay~~the ~~Road,~~SEC ~~Suite~~relating ~~100~~to ~~Salt~~the ~~Lake~~penny ~~City~~stock market, ~~Utah~~which, ~~84117~~in highlight form, sets forth:

~~Our~~· ~~common stock is considered a "penny stock."~~ The ~~application~~basis ofon ~~the~~which ~~"penny stock" rules to our common stock could limit~~ the ~~trading~~broker ~~and~~or ~~liquidity~~dealer ofmade the ~~common~~suitability ~~stock~~determination, ~~adversely affect the market price of our common stock~~ and ~~increase~~· ~~your~~That ~~transaction~~the ~~costs~~broker toor ~~sell~~dealer ~~those~~received ~~shares. The Commission has adopted regulations which generally define~~ a ~~"penny~~signed, ~~stock"~~written toagreement befrom ~~any~~the ~~equity~~investor ~~security~~prior ~~that has a market price (as defined) of less than $5.00 per share or an exercise price of less than $5.00 per share, subject~~ to ~~certain~~the ~~exceptions~~transaction.

~~Shareholders~~Disclosure ~~should~~also behas ~~aware that, according~~ to ~~SEC~~be ~~Release~~made ~~No.~~about ~~34-29093~~the ~~dated~~risks ~~April~~of ~~17,~~investing ~~1991,~~in ~~the market for~~ penny stocks ~~has suffered~~ in ~~recent~~both ~~years~~public ~~from~~offerings ~~patterns of fraud~~ and ~~abuse.~~in ~~Such~~secondary ~~patterns~~trading ~~include~~and ~~(1)control~~commissions ofpayable ~~the~~to ~~market~~both ~~for~~ the ~~security by one or a few~~ broker-~~dealers~~dealer ~~that~~and ~~are often related to~~ the ~~promoter~~registered orrepresentative, ~~issuer;~~current ~~(2)~~quotations ~~manipulation~~for ofthe ~~prices~~securities ~~through prearranged matching of purchases~~ and ~~sales~~the ~~and~~rights ~~false~~ and ~~misleading~~remedies ~~press~~available ~~releases;~~to ~~(3)~~an ~~boiler~~investor ~~room~~in ~~practices~~cases involving high-pressure sales tactics and unrealistic price projections by inexperienced sales persons; (4) excessive and undisclosed bid-ask differential and markups by selling broker dealers; and (5) the wholesale dumping of fraud ~~the~~in ~~same~~penny ~~securities~~stock bytransactions. ~~promoters~~Finally, ~~and~~monthly ~~broker-dealers~~statements ~~after prices~~ have ~~been~~to ~~manipulated~~be tosent adisclosing ~~desired~~recent ~~level,~~price ~~along~~information ~~with~~for the ~~resulting~~penny ~~inevitable~~stock ~~collapse~~held ofin ~~those~~the ~~prices~~account and ~~with~~information ~~consequent~~on ~~investor losses. The occurrence of these patterns or practices could increase~~ the ~~volatility~~limited ofmarket ~~our~~in ~~share~~penny ~~price~~stocks.

~~Our management~~FINRA isSALES ~~aware~~PRACTICE ofREQUIREMENTS ~~the~~MAY ~~abuses~~LIMIT ~~that~~A ~~have~~STOCKHOLDER'S ~~occurred historically in~~ABILITY ~~the~~TO ~~penny~~BUY ~~stock~~AND ~~market~~SELL OUR STOCK.

13The Financial Industry Regulatory Authority ("FINRA") has adopted rules that relate to the application of the Commission's penny stock rules in trading our securities and require that a broker/dealer have reasonable grounds for believing that the investment is suitable for that customer, prior to recommending the investment. Prior to recommending speculative, low priced securities to their non-institutional customers, broker/dealers must make reasonable efforts to obtain information about the customer's financial status, tax status, investment objectives and other information. Under interpretations of these rules, the FINRA believes that there is a high probability that speculative, low priced securities will not be suitable for at least some customers. The FINRA requirements make it more difficult for broker/dealers to recommend that their customers buy our common stock which may have the effect of reducing the level of trading activity and liquidity of our common stock. Further, many brokers charge higher transactional fees for penny stock transactions. As a result, fewer broker/dealers may be willing to make a market in our common stock thereby reducing a shareholder's ability to resell shares of our common stock.

~~Dividends~~15

~~The~~IF ~~Company~~WE ~~has~~FAIL ~~not~~TO ~~declared~~COMPLY ~~any~~WITH ~~cash~~THE ~~dividends~~RULES ~~with~~UNDER ~~respect~~THE toSARBANES-OXLEY ~~its~~ACT ~~common~~RELATED ~~stock~~TO orACCOUNTING ~~preferred~~CONTROLS ~~stock~~AND ~~during~~PROCEDURES ~~the~~OR ~~last~~IF ~~two~~MATERIAL ~~fiscal~~WEAKNESSES ~~years~~OR ~~and~~OTHER ~~does~~DEFICIENCIES ~~not~~ARE ~~intend~~DISCOVERED toIN ~~declare~~OUR ~~dividends~~INTERNAL inACCOUNTING ~~the~~PROCEDURES, ~~foreseeable~~OUR ~~future.~~STOCK ~~There~~PRICE ~~are~~COULD noDECLINE ~~material restrictions limiting or that are likely to limit the Company's ability to pay dividends on its outstanding securities~~SIGNIFICANTLY.

~~Recent~~Section ~~Sales~~404 of ~~Unregistered~~the ~~Securities~~Sarbanes-Oxley Act requires annual management assessments of the effectiveness of our internal controls over financial reporting and a report by our independent auditors addressing these assessments. We are in the process of documenting and testing our internal control procedures, and we may identify material weaknesses in our internal control over financial reporting and other deficiencies. If material weaknesses and deficiencies are detected, it could cause investors to lose confidence in our Company and result in a decline in our stock price and consequently affect our financial condition. In addition, if we fail to achieve and maintain the adequacy of our internal controls, we may not be able to ensure that we can conclude on an ongoing basis that we have effective internal controls over financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act. Moreover, effective internal controls, particularly those related to revenue recognition, are necessary for us to produce reliable financial reports and are important to helping prevent financial fraud. If we cannot provide reliable financial reports or prevent fraud, our business and operating results could be harmed, investors could lose confidence in our reported financial information, and the trading price of our common stock could drop significantly. In addition, we cannot be certain that additional material weaknesses or significant deficiencies in our internal controls will not be discovered in the future.

~~When~~OUR weCOMMON ~~acquired~~STOCK ~~Young~~MAY ~~Aviation~~BE onTHINLY ~~October 3~~TRADED, ~~2011~~LIQUIDITY LIMITED, weAND ~~issued~~WE anMAY ~~aggregate~~BE ofUNABLE ~~165,787,165~~TO ~~shares~~OBTAIN ofLISTING ~~Common~~OF ~~Stock~~OUR toCOMMON ~~the~~STOCK ~~Members~~ON ofA ~~Young~~MORE ~~Aviation~~LIQUID MARKET.

OnOur ~~October~~common 5,stock ~~2011,~~is quoted on the ~~Company~~OTC ~~issued~~which ~~5,000,000~~provides ~~shares~~significantly ofless ~~restricted~~liquidity ~~common~~than ~~stock~~a tosecurities ~~Colm~~exchange J.(such ~~King~~as ~~for~~the ~~his~~American ~~provision~~or ofNew ~~consulting~~York ~~and~~Stock ~~advisory~~Exchange) ~~services~~or ~~related~~an toautomated quotation system (such as the ~~Company's~~Nasdaq ~~accounting~~National ~~and~~Market ~~compliance~~or ~~requirements~~SmallCap Market). There is uncertainty that we will ever be accepted for a listing on an automated quotation system or a securities exchange.

OnOften ~~October~~there 5,is ~~2011,~~currently ~~the~~a ~~Company~~limited ~~issued~~volume ~~5,000,000~~of ~~shares~~trading ofin ~~restricted~~our common stock, toand ~~David~~on E.many ~~Wise,~~days asthere ~~special~~has ~~securities~~been ~~counsel~~no totrading ~~the~~activity ~~Company,~~at ~~for~~all. ~~his~~The ~~provision~~purchasers of ~~legal~~shares ~~advice~~of ~~and~~our ~~services~~common ~~related~~stock may find it difficult to resell their shares at prices quoted in the ~~Company's~~market ~~Exchange~~or ~~Act~~at ~~reporting~~all.

~~These~~ Certain ~~securities~~stockholders ~~qualified~~control ~~for~~a ~~exemption~~large ~~under~~percentage ~~Section 4(2)~~ of ~~the~~our ~~Securities~~common ~~Act~~stock ~~since~~and ~~the~~Series ~~issuance~~A ofPreferred ~~securities~~Shares byand ustherefore ~~did~~the ~~not~~current ~~involve~~stockholders awill ~~public~~continue ~~offering. The offering was not a “public offering” as defined in Section 4(2) due~~ to ~~the~~control ~~insubstantial number of persons involved in~~ the ~~transaction~~Company, ~~size of the offering, manner of the offering~~ and ~~number~~their ofinterests ~~securities~~may ~~offered.~~be Wedifferent ~~did~~from ~~not undertake an offering in which we sold a high number of securities to a high number of investors. In addition~~yours, ~~these shareholders had the necessary investment intent~~ as ~~required by Section 4(2) since they agreed to and received share certificates bearing~~ a legend stating that such securities are restricted pursuant to Rule 144 of the Securities Act. This restriction ensures that these securities would not be immediately redistributed into the market and therefore not be part of a “public offering.” Based on an analysis of the above factorsresult, weyou may have ~~met~~no ~~the~~effective ~~requirements~~voice toin ~~qualify~~our ~~for exemption under Section 4(2) of the Securities Act for this transaction~~management.

~~Changes~~The Company’s President and CEO and Vice President and COO will retain control of the Company as a result of their ownership of the Series A and Series B Preferred Stock. Management’s interests may be different from yours, and as a result, the shareholders may have no effective voice in ~~Control~~managing the affairs of the Company.

~~Securities~~FUTURE ~~Authorized~~SALES ~~for~~OF ~~Issuance~~SHARES ~~under~~OF ~~Equity~~OUR ~~Compensation~~COMMON ~~Plans~~STOCK MAY DECREASE THE PRICE FOR SUCH SHARES.

WeActual ~~did~~sales, ~~not~~or the prospect of sales by our shareholders, may have a negative effect on the market price of the shares of our common stock. We may also register certain shares of our common stock that are subject to outstanding convertible securities, if any, ~~equity~~or ~~compensation~~reserved for issuance under our stock option plans, asif ofany. ~~December~~Once 31such shares are registered, ~~2012~~they can be freely sold in the public market upon exercise of the options. ~~Our~~ ~~Board~~If any of ~~Directors~~our ~~may~~shareholders ~~adopt~~either anindividually ~~equity~~or ~~compensation~~in ~~plan~~the aggregate causes a large number of securities to be sold in the public market, or if the market perceives that these holders intend to sell a large number of securities, such sales or anticipated sales could result in a substantial reduction in the trading price of shares of our common stock and could also impede our ability to raise future capital.

~~Purchases of Equity Securities by the Issuer and Affiliated Purchasers~~16

~~None~~CURRENT SHAREHOLDERS WILL BE IMMEDIATELY AND SUBSTANTIALLY DILUTED UPON A MERGER OR BUSINESS COMBINATION.

~~ITEM~~To 6the extent that additional shares of common stock are issued in connection with a merger or business combination, our shareholders could experience significant dilution of their respective ownership interests. ~~SELECTED~~ ~~FINANCIAL~~Furthermore, ~~DATA~~the issuance of a substantial number of shares of common stock may adversely affect prevailing market prices, if any, for the common stock and could impair our ability to raise additional capital through the sale of equity securities.

WeTHE ~~are~~COMPANY aHAS ~~smaller~~NOT ~~reporting~~PAID ~~company~~DIVIDENDS, asNOR ~~defined~~DOES byIT ~~Rule~~INTEND ~~229~~TO.~~10(f)(1) and are not required to provide information under this item.~~

14The Company has paid no dividends on its Common Stock to date, and there are no plans to pay any in the foreseeable future. Initial earnings which the Company may realize, if any, will be retained to finance growth of the Company. Any future dividends, of which there can be no assurance, will be directly dependent upon the earnings of the Company, its financial requirements and other factors.

~~ITEM~~OUR ~~7. MANAGEMENT’S~~COMMON ~~DISCUSSION~~STOCK ~~AND~~MAY ~~ANALYSIS~~BE OFSUBJECT ~~FINANCIAL~~TO ~~CONDITION~~PRICE ~~AND~~VOLATILITY ~~RESULTS~~UNRELATED OFTO OUR OPERATIONS.

~~Overview~~The market price of our common stock could fluctuate substantially due to a variety of factors, including market perception of our ability to achieve our planned growth, quarterly operating results of other companies in the same industry, trading volume in our common stock, changes in general conditions in the economy and the financial markets or other developments affecting our competitors or us. In addition, the stock market is subject to extreme price and volume fluctuations. This volatility has had a significant effect on the market price of securities issued by many companies for reasons unrelated to their operating performance and could have the same effect on our common stock.

~~Young~~SECURITIES ~~Aviation,~~ANALYSTS ~~founded~~MAY inNOT ~~2004,~~PROVIDE isCOVERAGE ~~currently~~OF aOUR ~~diversified~~COMMON ~~broker~~STOCK ~~and~~OR ~~supplier~~MAY ofISSUE ~~parts,~~NEGATIVE ~~components and products to the general aviation and aerospace markets of the U.S.~~REPORTS, ~~Europe~~WHICH ~~and~~MAY ~~Asia.~~HAVE ~~"General~~A ~~aviation"~~NEGATIVE isIMPACT ~~defined~~ON asTHE ~~all~~MARKET ~~aviation~~PRICE ~~other~~OF ~~than~~OUR ~~military~~COMMON ~~and scheduled commercial airlines~~STOCK. ~~Over 20% of our sales revenue has been derived from international sales for the period from January 1, 2009 to date.~~

~~Young~~Securities ~~Aviation~~analysts ~~services~~have anot ~~broad~~historically ~~range~~provided research coverage of ~~clients~~our ~~such~~common asstock ~~aircraft~~and ~~leasing~~may ~~companies~~elect not to do so in the future. If securities analysts do not cover our common stock, ~~major~~the ~~airlines~~lack of research coverage may cause the market price of our common stock to decline. The trading market for our common stock may be affected in part by the research and reports that industry or financial analysts publish about our business. If one or more of the analysts who elects to cover us downgrades our stock, ~~repair~~our ~~stations~~stock price would likely decline substantially. If one or more of these analysts ceases coverage of us, ~~fixed~~we could lose visibility in the market, which in turn could cause our stock price to decline. In addition, rules mandated by the Sarbanes-~~base~~Oxley ~~operators~~Act of 2002 and a global settlement reached in 2003 between the SEC, ~~leasing~~other ~~companies~~regulatory agencies and ~~aftermarket~~a ~~suppliers~~number of investment banks have led to a number of fundamental changes in how analysts are reviewed and compensated. In particular, many investment banking firms are required to contract with independent financial analysts for their stock research. It may be difficult for companies such as ours, with smaller market capitalizations, to attract independent financial analysts that will cover our common stock. This could have a negative effect on the market price of our stock.

Cost of Goods Sold has decreased to $35,596 for the year ended December 31, 2012 from $116,823 for the year ended December 31, 2011. The decrease is primarily due to the decrease in sales of the Company’s products and services.17

~~Operating~~Other ~~Expenses:~~Risks

~~Operating~~MERGERS ~~expenses~~OF ~~increased~~THE byTYPE ~~$17,140~~THAT orWE ~~11.3%~~HAVE toUNDERGONE ~~$168,866~~ARE ~~for~~OFTEN ~~the~~SCRUTINIZED ~~year~~BY ~~ended December~~REGULATORS ~~31,~~AND ~~2012~~WE ~~from~~MAY ~~$151,726~~ENCOUNTER ~~for~~FUTURE ~~the~~DIFFICULTIES ~~year~~OR ~~ended~~DELAYS ~~December~~IN ~~31,~~OBTAINING ~~2011. The~~FUTURE ~~increase~~REGULATORY inAPPROVALS ~~operating~~WHICH ~~expenses~~WOULD ~~was~~NEGATIVELY ~~primarily~~IMPACT ~~due~~OUR toFINANCIAL ~~the~~CONDITION ~~marketing~~AND ~~efforts.~~THE ~~Other~~VALUE ~~losses~~AND ~~were~~LIQUIDITY ~~$78,838~~OF ~~recorded~~YOUR asSHARES ~~Theft~~OF ~~Loss~~COMMON ~~and $10,469 for interest~~STOCK.

~~Loss~~On ~~from~~June ~~Operations:~~29, 2005, the SEC adopted rules dealing with private company mergers into dormant or inactive public companies. As a result, it is likely that we will be scrutinized carefully by the SEC and possibly by the Financial Industry Regulatory Authority (“FINRA”) which could result in difficulties or delays in achieving SEC clearance of any future registration statements or other SEC filings that we may pursue, in attracting FINRA-member broker-dealers to serve as market-makers in our common stock, or in achieving admission to one of the Nasdaq stock markets or any other national securities market. As a consequence, our financial condition and the value and liquidity of your shares of our common stock may be negatively impacted.

~~Loss~~THE ~~from~~ELIMINATION ~~operations~~OF ~~was~~MONETARY ~~$146~~LIABILITY AGAINST OUR DIRECTORS,~~406~~ ~~for~~OFFICERS ~~the~~AND ~~year~~EMPLOYEES ~~ended~~UNDER ~~December~~FLORIDA ~~31,~~LAW ~~2012~~AND ~~compared~~THE toEXISTENCE aOF ~~loss~~INDEMNIFICATION ofRIGHTS ~~$59~~TO OUR DIRECTORS,~~116~~ ~~for~~OFFICERS ~~the~~AND ~~year~~EMPLOYEES ~~ended~~MAY ~~December~~RESULT ~~31,~~IN ~~2011~~SUBSTANTIAL ~~mainly~~EXPENDITURES ~~due~~BY toUS ~~the~~AND ~~increase~~MAY inDISCOURAGE ~~Operating~~LAWSUITS ~~Expenses~~AGAINST ~~and~~OUR ~~Theft~~DIRECTORS, ~~Loss~~OFFICERS ~~described~~AND ~~above~~EMPLOYEES.

~~Interest~~Our ~~Income:~~Bylaws contain specific provisions that eliminate the liability of our directors for monetary damages to our company and shareholders, and we are prepared to give such indemnification to our directors and officers to the extent provided by Florida law. We may also have contractual indemnification obligations under our employment agreements with our officers. The foregoing indemnification obligations could result in our company incurring substantial expenditures to cover the cost of settlement or damage awards against directors and officers, which we may be unable to recoup. These provisions and resultant costs may also discourage our company from bringing a lawsuit against directors and officers for breaches of their fiduciary duties, and may similarly discourage the filing of derivative litigation by our shareholders against our directors and officers even though such actions, if successful, might otherwise benefit our company and shareholders.

~~The company had no interest income to report.~~EMPLOYEES

~~Net~~The ~~Loss:~~Company currently has approximately twenty employees including its officers and directors.

~~Net~~BANKRUPTCY ~~Loss~~PROCEEDINGS ~~was~~DURING ~~$235,713~~THE ~~for~~PAST ~~the~~FIVE ~~year ended December 31, 2012 compared to a profit of $62,582 for the year ended December 31, 2011 mainly due to the increase in Cost of Good Sold and Operating Expenses described above.~~YEARS

~~Going~~Our ~~Concern~~Company has not been involved in any bankruptcy, receivership or any similar proceeding, and, except as set forth herein, we have not had or been a party to any material reclassifications, mergers or consolidations during the previous five (5) years.

AsDOMAIN ~~reflected~~NAMES in- the accompanying consolidated financial statements, the Company had a net loss and net cash used in operations of $235,713 and $28,576, respectively, for the year ended December 31, 2012. In addition, the Company had a working capital deficit of 230,197 at December 31, 2012. These matters raise substantial doubt about the Company's ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company's ability to raise additional capital, further implement its business plan and to generate additional revenues.None

15MAJOR CUSTOMERS - None

~~Management~~RESEARCH ~~believes~~AND ~~that~~DEVELOPMENT the actions presently being taken provide the opportunity for the Company to continue as a going concern. The consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.ACTIVITIES

~~LIQUIDITY~~The ~~AND~~Company ~~CAPITAL~~has ~~RESOURCES~~not performed any customer-sponsored research and development activities relating to any new products or services during 2013 or 2014.

AsENVIRONMENTAL of December 31, 2012, we had net current liabilities of $233,197 compared to $115,581 as of December 31, 2011. Our balance of cash and cash equivalents at December 31, 2012 was $0 compared to $4,123 at December 31, 2011.LAWS

~~Operational~~We ~~cash~~do ~~flow~~not handle, store or transport hazardous materials or waste products. We abide by all applicable federal, state and local laws and regulations governing the use, manufacture, storage, handling and disposal of hazardous materials and waste products. We do not anticipate the cost of complying with these laws and regulations to be material.

We had operating cash outflows in the year ended December 30, 2012 of $51,189, and $53,692 in the year ended December 30, 2011. Our primary uses of cash have been for marketing expenses, employee compensation, product development and working capital. All cash we receive has been expended in the furtherance of growing assets.18

~~Financing~~ITEM ~~cash~~1B. ~~flows~~UNRESOLVED STAFF COMMENTS.

~~We may not have sufficient resources to fully develop any new products or technologies or expand our inventory levels unless we are able to raise additional financing~~None. We can make no assurances these required funds will be available on favorable terms, if at all. If additional capital is raised through the sale of equity or convertible debt securities, the issuance of such securities would result in dilution to our existing stockholders. Additionally, these conditions may increase costs to raise capital and/or result in further dilution. Our failure to raise capital when needed would adversely affect our business, financial condition and results of operations, and could force us to reduce or cease our operations.

WeITEM ~~believe~~2. that we will be able to meet the costs of growth and public reporting with funds generated from operations and additional amounts generated through debt and equity financing, Although management believes that the required financing to fund product development and increasing inventory levels can be secured at terms satisfactory to the Company, there is no guarantee these funds will be made available, and if funds are available, that the terms will be satisfactory to the CompanyPROPERTIES.

~~Impact~~Office ~~of Inflation~~Locations

~~The~~Until ~~business~~January ~~will~~22, ~~have~~2014, towe ~~absorb~~maintained ~~any~~our ~~inflationary~~principal ~~increases~~offices onat ~~development~~10778 ~~costs~~NW in53rd ~~the~~Street, ~~short-term~~Suite E, ~~with~~Sunrise Florida 33352, occupying an executive office of 500 square feet, for which no rent was paid through the ~~expectation~~year ~~that~~end itof ~~will~~December be31, ~~able~~2013. toFollowing ~~pass~~the ~~inflationary~~completion ~~increases~~of onthe ~~costs~~Merger, as recorded on toJanuary 27, 2014, our ~~customers~~headquartered ~~through~~address ~~price~~changed ~~increases~~to on3701 ~~the~~SW 47th ~~release~~Avenue, ofSuite ~~these~~415, ~~new/enhanced~~Davie, ~~products~~Florida ~~into~~33314, the ~~market~~principal rented office and ~~hence~~manufacturing ~~the~~facility ~~management~~of doVapor ~~not~~Group, ~~expect~~Inc., ~~inflation~~consisting toof beapproximately a7,600 ~~significant~~square ~~factor~~feet of office, manufacturing and warehouse space in ~~our~~a ~~business~~one story industrial park complex.

~~Off-Balance~~ITEM ~~Sheet~~3. ~~Arrangements~~LEGAL PROCEEDINGS.

There are no ~~off-balance~~pending ~~sheet~~legal ~~arrangements~~or ~~between~~governmental usproceedings ~~and~~relating ~~any~~to ~~other~~our ~~entity~~Company ~~that~~to ~~have,~~which orwe are ~~reasonably~~a ~~likely~~party, and to ~~have~~our knowledge, athere ~~current~~are orno ~~future~~material ~~effect~~proceedings onto ~~our~~which ~~financial~~any ~~condition,~~of ~~changes~~our ~~in financial condition~~directors, ~~revenues~~executive officers or ~~expenses,~~affiliates ~~results~~are ofa ~~operations,~~party ~~liquidity,~~adverse ~~capital~~to ~~expenditures~~us or ~~capital~~which ~~resources~~have ~~that~~a is material interest adverse to ~~stockholders~~us.

16ITEM 4. MINE SAFETY DISCLOSURE.

~~Critical~~Not ~~Accounting Policies~~applicable.

The discussion and analysis of our financial condition and results of operations are based upon our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.19

~~Management~~PART believes that the application of these policies on a consistent basis enables us to provide useful and reliable financial information about our operating results and financial condition. Some of the critical accounting estimates are detailed below.II

As of ~~December~~the 31date of this Annual Report, ~~2012~~the Company's Common Stock is quoted on the Over-the-Counter Pink-Sheets under the symbol "VPOR" which was changed by FINRA from the old symbol, ~~there~~“SPLI”, ~~were~~on noApril 29, 2014. The market for the Company's Common Stock is limited, volatile and sporadic and the price of the Company's Common Stock could be subject to wide fluctuations in response to quarterly variations in operating results, news announcements, trading volume, sales of Common Stock by officers, directors and principal shareholders of the Company, general market trends, changes in orthe ~~disagreements~~supply ~~with~~and ~~accountants~~demand onfor ~~accounting~~the Company's shares, and other factors. The following table sets forth the high and low sales prices for each quarter relating to the Company's Common Stock for the last two fiscal years. These quotations reflect inter-dealer prices without retail mark-up, markdown, or ~~financial~~commissions, ~~disclosure~~and ~~matters~~may not reflect actual transactions.

Critical Accounting Estimates and New Accounting Pronouncements

	High		Low
Fiscal 2013
1Q2013	$	0.0020	$	0.0007
2Q2013	$	0.0014	$	0.0006
3Q2013	$	0.0017	$	0.0006
4Q2013	$	0.0019	$	0.0060

Critical Accounting Estimates

Fiscal 2014
1Q2014	$	0.4180	$	0.0006
2Q2014	$	0.3045	$	0.0530
3Q2014	$	0.0819	$	0.0138
4Q2014	$	0.0310	$	0.0031

~~The~~Description ~~preparation~~ of financial statements in accordance with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions that affect reported amounts and related disclosures in the financial statements. Management considers an accounting estimate to be critical if:Securities

●Our itauthorized ~~requires~~capital ~~assumptions~~stock toconsists beof ~~made~~4,500,000,000 ~~that~~shares ~~were~~of ~~uncertain~~common atstock, ~~the~~par ~~time~~value ~~the~~$0.001 ~~estimate~~per ~~was~~share, ~~made~~and 15,000,000 shares of preferred stock, $0.001 par value per share. As of March 30, 2015, 2,658,813,601 shares of our common stock were issued and outstanding.

●Common ~~changes~~Stock. inOur Articles of Incorporation, as amended on October 28, 2014, January 29, 2015 and March 10, 2015, respectively, to increase the ~~estimate~~total ornumber ~~different~~of ~~estimates~~authorized ~~that~~shares ~~could~~of ~~have~~common ~~been~~stock, ~~selected~~provide ~~could~~that ~~have~~we aare ~~material~~authorized ~~impact~~to onissue ~~our~~up ~~results~~to 4.5 billion (4,500,000,000) shares of ~~operations~~common orstock ~~financial~~with ~~condition~~a par value of $.001 per share.

WeEach ~~base~~outstanding ~~our~~share ~~estimates~~of ~~and~~common ~~judgments~~stock onentitles ~~our~~the ~~experience,~~holder ~~our~~thereof ~~current~~to ~~knowledge,~~one ~~and~~vote ~~our~~per ~~beliefs~~share ofon ~~what~~all ~~could~~matters. ~~occur~~Stockholders indo ~~the~~not ~~future,~~have ~~our~~preemptive ~~observation~~rights ofto ~~trends~~purchase shares in ~~the~~any ~~industry,~~future ~~information~~issuance ~~provided~~of by our ~~customers~~common ~~and information available from other sources~~stock. ~~Actual~~Upon ~~results~~our ~~may~~liquidation, ~~differ~~dissolution ~~from these estimates under different assumptions~~ or ~~conditions.~~winding Weup, ~~have~~and ~~identified~~after ~~the~~payment ~~following~~of ~~accounting~~creditors ~~policies~~ and ~~estimates~~preferred asstockholders, ~~those~~if ~~that~~any, ~~we believe are most critical to~~ our ~~financial~~assets ~~condition~~will ~~and~~be ~~results~~divided ofpro-rata ~~operations~~on ~~and~~a ~~that~~share-for-share ~~require~~basis ~~management’s~~among ~~most~~the ~~subjective~~holders ~~and~~of ~~complex judgments in estimating~~ the ~~effect~~shares of ~~inherent~~common ~~uncertainties: share-based compensation expense, income taxes, and derivative financial instruments~~stock.

~~Share-Based~~The ~~Compensation~~holders ~~Expense.~~of Weshares ~~plan~~of our common stock are entitled to ~~calculate~~dividends ~~share-based~~out ~~compensation~~of ~~expense~~funds ~~for~~legally ~~option~~available ~~awards~~when and ~~warrant~~as ~~issuances~~declared ~~("Share-based~~by ~~Awards")~~our ~~based~~board onof ~~the~~directors. ~~estimated~~Our ~~grant/issue-date~~board ~~fair~~of ~~value~~directors ~~using~~has ~~the~~never ~~Black-Scholes-Merton~~declared ~~option~~a ~~pricing~~cash ~~model~~dividend ~~("Black-Sholes~~and ~~Model"),~~does ~~and~~not ~~recognize~~anticipate declaring any dividend in the ~~expense~~foreseeable onfuture. aShould ~~straight-line~~we ~~basis~~decide ~~over~~in the ~~vesting~~future ~~period~~to pay dividends, ~~net~~as ofa ~~estimated~~holding ~~forfeitures.~~company, ~~The~~our ~~Black-Scholes~~ability ~~Model~~to ~~requires~~do ~~the~~so ~~use~~and ofmeet aother ~~number~~obligations ofdepends ~~assumptions~~upon ~~including~~the ~~volatility~~receipt of ~~the~~dividends ~~stock~~or ~~price,~~other ~~the~~payments ~~weighted~~from ~~average~~our ~~risk-free~~operating ~~interest~~subsidiaries ~~rate,~~and other holdings and ~~the~~investments. ~~vesting~~In ~~period~~addition, ofour ~~the~~operating ~~Share-based~~subsidiaries, ~~Award~~from intime ~~determining~~to ~~the~~time, ~~fair~~may ~~value~~be ofsubject ~~Share-based~~to ~~Awards.~~restrictions ~~Although~~on wetheir ~~believe~~ability ~~our~~to ~~assumptions~~make ~~used~~distributions to ~~calculate~~us, ~~share-based~~including ~~compensation~~as ~~expense~~a ~~are~~result ~~reasonable~~of restrictive covenants in loan agreements, ~~these~~restrictions ~~assumptions~~on ~~can~~the ~~involve~~conversion ~~complex~~of ~~judgments~~local ~~about~~currency ~~future~~into ~~events,~~U.S. ~~which~~dollars ~~are~~or ~~open~~other tohard ~~interpretation~~currency and ~~inherent~~other ~~uncertainty~~regulatory restrictions. In ~~addition~~the event of our liquidation, ~~significant~~dissolution ~~changes~~or towinding up, holders of our ~~assumptions~~common ~~could~~stock ~~significantly~~are ~~impact~~entitled to receive, ratably, the ~~amount~~net ofassets ~~expense~~available ~~recorded~~to instockholders aafter ~~given~~payment ~~period~~of all creditors and preferred stockholders.

1720

~~Income~~Preferred ~~Taxes~~Stock. AsOur ~~part~~Articles of ~~the~~Incorporation, ~~process~~as ofamended, ~~preparing~~also ~~our~~provide ~~consolidated~~that ~~financial~~we ~~statements,~~are weauthorized ~~will~~to beissue ~~required~~up to ~~estimate~~fifteen ~~income~~million ~~taxes~~(15,000,000) inshares ~~each~~ of ~~the~~preferred ~~jurisdictions~~stock inwith ~~which~~a wepar ~~operate.~~value ~~Our~~of ~~provision~~$.001 ~~for~~per ~~income~~share. ~~taxes~~As isof ~~determined using~~ the ~~asset~~date ~~and~~of ~~liability~~this ~~approach~~report, tothere ~~account~~are ~~for~~two ~~income~~series ~~taxes.~~of APreferred ~~current~~Stock ~~liability~~designated, isSeries ~~recorded~~A ~~for~~and ~~the~~Series ~~estimated~~B, ~~taxes~~of ~~payable~~which ~~for~~there ~~the current year. Deferred tax assets and liabilities~~ are ~~recorded~~1,000,000 ~~for~~shares ~~the~~of ~~estimated~~Series ~~future~~A ~~tax~~Preferred ~~consequences~~Stock ~~attributable~~issued toand ~~differences~~outstanding ~~between~~and ~~the~~no ~~financial~~shares ~~statement~~of ~~carrying~~Series ~~amounts~~B ofPreferred ~~existing~~Stock ~~assets~~issued and ~~liabilities and their respective tax bases~~outstanding. ~~Deferred~~Our ~~tax~~Board ~~assets~~of ~~and~~Directors ~~liabilities~~has ~~are measured using~~ the ~~enacted~~authority, ~~tax~~without ~~rates~~further inaction ~~effect~~by ~~for~~ the ~~year~~shareholders, into ~~which~~issue ~~the~~from ~~timing~~time ~~differences are expected~~ to betime ~~recovered~~the orpreferred ~~settled.~~stock ~~The effect on deferred tax assets and liabilities of changes~~ in ~~tax~~one ~~rates~~ or ~~tax~~more ~~laws~~series ~~are recognized in the provision~~ for ~~income~~such ~~taxes~~consideration inand ~~the~~with ~~period~~such ~~that~~relative ~~includes the enactment date. Valuation allowances are established~~rights, ~~when necessary~~privileges, topreferences ~~reduce~~and ~~deferred~~restrictions ~~tax~~that ~~assets to~~ the ~~amount~~Board ~~more-likely-than-not~~may ~~to be realized~~determine. ~~Changes~~The inpreferences, ~~valuation~~powers, ~~allowances~~rights ~~will~~and ~~flow~~restrictions ~~through~~of ~~the~~different ~~statement~~series of ~~operations~~preferred ~~unless~~stock ~~related~~may todiffer ~~deferred~~with ~~tax~~respect ~~assets~~to ~~that~~dividend ~~expire~~rates, ~~unutilized~~amounts orpayable ~~are~~on ~~modified~~liquidation, ~~through~~voting ~~translation~~rights, inconversion ~~which~~rights, ~~case~~redemption ~~both~~provisions, ~~the~~sinking ~~deferred~~fund ~~tax~~provisions ~~asset~~ and ~~related~~purchase ~~valuation~~funds ~~allowance~~and ~~are~~other ~~similarly adjusted~~matters. ~~Where~~The aissuance ~~valuation~~of ~~allowance~~preferred ~~was~~stock ~~established~~could ~~through~~adversely ~~purchase~~affect ~~accounting~~the ~~for~~voting ~~acquired~~power ~~deferred~~or ~~tax~~other ~~assets,~~rights ~~any~~of ~~future~~the ~~change~~holders ~~will~~of becommon ~~credited or charged to income tax expense~~stock.

~~The~~Series ~~determination~~A Preferred Stock. There are 1,000,000 shares of ~~our~~preferred ~~provision~~stock ~~for~~designated ~~income~~as ~~taxes~~Series ~~requires~~A ~~significant~~Preferred ~~judgment,~~Stock. ~~the~~Each ~~use~~share of ~~estimates,~~Series ~~and~~A ~~the~~Preferred ~~interpretation~~Stock ~~and~~has ~~application~~a ofpar ~~complex~~value ~~tax~~of ~~laws~~$.001 Inper ~~the~~share ~~ordinary~~and ~~course~~a ofstated ~~our~~value ~~business,~~equal ~~there~~to ~~are~~$.001. ~~transactions~~The ~~and~~Holders ~~calculations~~of ~~for~~outstanding ~~which~~Series ~~the~~A ~~ultimate~~Preferred ~~tax~~Stock ~~determination~~shall isbe ~~uncertain.~~entitled Into ~~spite~~participate ofin ~~our~~any ~~belief~~dividends ~~that~~declared weon ~~have~~the ~~appropriate~~Corporation’s ~~support~~common ~~for~~stock ~~all~~.In ~~the~~addition ~~positions~~to ~~taken~~voting onas ~~our~~a ~~tax~~class ~~returns,~~as weto ~~acknowledge~~all matters that ~~certain~~require ~~positions~~class ~~may~~voting beunder ~~successfully~~the ~~challenged~~Florida byBusiness ~~the~~Corporation ~~taxing~~Act, ~~authorities.~~the WeHolders ~~determine~~of the ~~tax~~Series ~~benefits~~A ~~more~~Preferred ~~likely~~Stock ~~than~~shall ~~not~~vote toon beall ~~recognized~~matters with ~~respect~~the toholders ~~uncertain~~of ~~tax~~the ~~positions.~~Common ~~Although~~Stock we(and ~~believe~~not ~~our~~as ~~recorded~~a ~~tax~~separate ~~assets~~class) ~~and~~on ~~liabilities~~ten ~~are~~thousand ~~reasonable~~votes per share (10,000:1) ~~tax~~basis. ~~laws~~The ~~and~~Holders ~~regulations~~of ~~are~~the ~~subject~~Series A Preferred Stock shall be entitled to ~~interpretation~~receive ~~and~~all ~~inherent~~notices ~~uncertainty;~~relating ~~therefore,~~to ~~our~~voting ~~assessments~~as ~~can~~are ~~involve~~required ~~both~~to abe ~~series~~given to the holders of ~~complex~~the ~~judgments~~Common ~~about~~Stock. ~~future~~The ~~events~~Series ~~and~~A ~~rely~~Preferred Stock shall, with respect to rights on ~~estimates~~liquidation, ~~and~~rank ~~assumptions~~equivalent to all classes of the common stock, $.001 ~~Although~~par wevalue ~~believe~~per ~~these~~share ~~estimates~~(collectively, ~~and~~the ~~assumptions~~"Common ~~are~~Stock" ~~reasonable~~or "Common Shares"), of the ~~final~~Corporation. ~~determination~~Shares ~~could~~of Series A Preferred Stock may not be ~~materially~~redeemed ~~different~~by ~~than~~the ~~that~~Corporation. ~~which~~Each isshare ~~reflected~~of inSeries ~~our~~A ~~provision~~Preferred ~~for~~Stock ~~income~~is ~~taxes~~not ~~and~~convertible ~~recorded~~into ~~tax~~any ~~assets~~other ~~and~~class ~~liabilities~~of capital stock.

~~New~~Series ~~Accounting~~B ~~Pronouncements~~Preferred Stock. On March 11, 2014, the Company designated 10,000,000 shares of the 15,000,000 authorized shares of preferred stock as Series B Preferred Stock. Each share of Series B Preferred Stock has a par value of $.001 per share and a stated value equal to $.001. The Holders of outstanding Series B Preferred Stock shall be entitled to participate in any dividends declared on the Corporation’s common stock .In addition to voting as a class as to all matters that require class voting under the Florida Business Corporation Act, the Holders of the Series B Preferred Stock shall vote on all matters with the holders of the Common Stock (and not as a separate class) on an eighteen hundred vote per share (1,800:1) basis. The Holders of the Series B Preferred Stock shall be entitled to receive all notices relating to voting as are required to be given to the holders of the Common Stock. The Series B Preferred Stock shall, with respect to rights on liquidation, rank equivalent to all classes of the common stock, $.001 par value per share (collectively, the "Common Stock" or "Common Shares"), of the Corporation. Shares of Series B Preferred Stock may not be redeemed by the Corporation. Each share of Series B Preferred Stock shall be convertible, without the payment of any additional consideration by the holder thereof and at the option of the holder thereof, at any time after the Series B Issue Date at the conversion ratio of one (1) share of Series B Preferred Stock for eighteen hundred (1,800) shares of Common Stock.

In December 2011, FASB issued Accounting Standards Update ("ASU") 2011-11, Balance Sheet - Offsetting. This guidance requires disclosures about offsetting and related arrangements for recognized financial instruments and derivative instruments. The standard is effective for us as of January 1, 2013 and will not materially impact our financial statement disclosures.21

In September 2011, the FASB issued ASU 2011-08, "Testing Goodwill for Impairment." This guidance provides the option to evaluate prescribed qualitative factors to determine whether a calculated goodwill impairment test is necessary. The standard is effective for us as of January 1, 2012 and will not materially impact on our financial condition, results of operations, or financial statement disclosures.Holders

InAs ~~May 2011, FASB issued Accounting Standards Update ("ASU") 2011-05, Comprehensive Income: Presentation~~ of ~~Comprehensive~~March ~~Income~~30, ~~to allow an entity the option to present the total of comprehensive income~~2015, there ~~the~~are ~~components of net income, and the components of other comprehensive income either in a single continuous statement of comprehensive income or in~~ two ~~separate~~holders ~~but consecutive statements. In both choices, an entity is required to present each component~~ of ~~net~~our ~~income~~preferred ~~along~~stock ~~with~~who ~~total~~are ~~net~~also ~~income,~~officers ~~each~~and ~~component~~directors of ~~other~~the ~~comprehensive~~Company ~~income along with a total for other comprehensive income,~~ and aapproximately ~~total~~75 ~~amount~~shareholders ~~for comprehensive income. ASU 2011-05 eliminates the option to present the components~~ of ~~other~~record ~~comprehensive income as part~~ of the ~~statement~~common ~~of changes in stockholders’ equity~~stock. The amendments do not change the guidance regarding the items that must be reported in other comprehensive income or when an item of other comprehensive income must be reclassified to net income. The amendments should be applied retrospectively, and is effective for fiscal years and interim periods within those years, beginning after December 15, 2011. Early adoption is permitted. The adoption is not expected to have a material impact on the Company’s results of operations, financial position or cash flows.

InTransfer ~~May~~Agent ~~2011, the FASB issued ASU 2011-04, Fair Value Measurement: Amendments to Achieve Common Fair Value Measurement~~ and Disclosure Requirements in U.S. GAAP and IFRSs. This ASU represents the converged guidance of the FASB and the IASB (the "Boards") on fair value measurement, and results in common requirements for measuring fair value and for disclosing information about fair value measurements, including a consistent meaning of the term "fair value." These amendments change some of the terminology used to describe many of the existing requirements in U.S. GAAP for measuring fair value and for disclosing information about fair value measurements. The amendments should be applied prospectively, and they are effective during interim and annual periods beginning after December 15, 2011. Early application by public entities is not permitted. The adoption is not expected to have a material impact on the Company’s results of operations, financial position or cash flows.Registrar

18On March 25, 2014, the Corporation appointed VStock Transfer, LLC, 77 Spruce Street, Suite 201, Cedarhurst, NY 11516 as its transfer agent and registrar for its common stock, replacing Interwest Transfer Co., 1981 Murray Holladay Road, Suite 100 Salt Lake City, Utah 84117, as its transfer agent and registrar for its common stock.

~~Management~~Our ~~does~~common ~~not~~stock ~~believe~~is ~~there~~considered ~~would~~a be"penny astock." ~~material~~The ~~effect~~application onof the ~~accompanying~~"penny ~~financial~~stock" ~~statements~~rules ~~had~~to ~~any~~our ~~other~~common ~~recently~~stock ~~issued~~could ~~but~~limit ~~not~~the ~~yet~~trading ~~effective~~and ~~accounting~~liquidity ~~standards~~of ~~been~~the ~~adopted~~common instock, adversely affect the ~~current~~market ~~period~~price of our common stock and increase your transaction costs to sell those shares. The Commission has adopted regulations which generally define a "penny stock" to be any equity security that has a market price (as defined) of less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exceptions.

~~Recent~~Shareholders ~~Events~~should be aware that, according to SEC Release No. 34-29093 dated April 17, 1991, the market for penny stocks has suffered in recent years from patterns of fraud and abuse. Such patterns include (1) control of the market for the security by one or a few broker-dealers that are often related to the promoter or issuer; (2) manipulation of prices through prearranged matching of purchases and sales and false and misleading press releases; (3) boiler room practices involving high-pressure sales tactics and unrealistic price projections by inexperienced sales persons; (4) excessive and undisclosed bid-ask differential and markups by selling broker dealers; and (5) the wholesale dumping of the same securities by promoters and broker-dealers after prices have been manipulated to a desired level, along with the resulting inevitable collapse of those prices and with consequent investor losses. The occurrence of these patterns or practices could increase the volatility of our share price.

~~Change~~Our management is aware of the abuses that have occurred historically in ~~Officers~~the ~~and~~penny ~~Directors~~stock market.

Effective on August 1, 2013, the Board of Directors of AvWorks Aviation Corp., a Nevada corporation (the "Company"), accepted the resignation of Joel Young as the President/Chief Executive Officer, Secretary, Treasurer/Chief Financial Officer and a member of the Board of Directors. Simultaneously, the Board of Directors accepted the consent of Michael Zoyes, as a member of the Board of Directors, the President/Chief Executive Officer, Secretary, Treasurer and Chief Financial Officer of the Company. Therefore, as of the date of this Current Report, the member of the Board of Directors is Michael Zoyes.Dividends

~~Mr.~~The ~~Young~~Company ~~did~~has not ~~resign~~declared asany acash ~~result~~dividends ofwith ~~any~~respect ~~disagreement~~to ~~with~~its common stock or preferred stock during the ~~Company~~last ontwo ~~any~~fiscal ~~matter~~years ~~relating~~and does not intend to declare dividends in the foreseeable future. There are no material restrictions limiting or that are likely to limit the Company’'s ~~operations,~~ability ~~policies~~to orpay ~~practices~~dividends on its outstanding securities.

Effective on September 23, 2013, the Board of Directors of AvWorks Aviation Corp., a Florida corporation (the "Company"), accepted the resignation of Michael Zoyes as the President/Chief Executive Officer, Secretary, Treasurer/Chief Financial Officer and a member of the Board of Directors. Simultaneously, the Board of Directors accepted the consent of Joe Eccles, as a member of the Board of Directors, the President/Chief Executive Officer, Secretary, Treasurer and Chief Financial Officer of the Company. Therefore, as of the date of this Current Report, the member of the Board of Directors is Joe Eccles.22

~~Mr.~~Recent ~~Zoyes~~Sales ~~did not resign as a result~~ of ~~any~~Unregistered ~~disagreement with the Company on any matter relating to the Company’s operations, policies or practices.~~Securities

~~Biography~~On January 22, 2014, the Company entered into an Agreement of Merger and Plan of Reorganization ("Merger Agreement") by and among the Company and the Vapor Group, Inc., a Florida corporation ("Vapor Group") and its shareholders, pursuant to which the Company will acquire 100% of the issued and outstanding shares of Vapor Group, in return for the issuance of 750,000,000 shares of its common stock following completion of a pending 30:1 reverse split of the Company’s common stock. On March 7, 2014, per a filing of an 8-K dated March 13, 2014, the Company and the other parties to the Merger Agreement amended the Merger Agreement such that:

~~Joe Eccles is~~ (a) ~~thirty~~The ~~eight~~Company’s ~~year~~Series ~~old~~B ~~business~~Preferred ~~executive~~Stock ~~who~~shall ~~graduated~~be ~~with~~issued ~~Honors from Suffolk College~~ in ~~New~~lieu ~~York~~of ~~in 1997. Mr. Eccles has spent his career in business management. Most recently, for more than~~ the ~~past~~issuance ~~five~~of ~~years (with~~ the ~~exception~~consideration of a750,000,000 ~~two~~shares ~~month~~of ~~sabbatical~~its heCommon ~~took~~Stock toper ~~do some missionary work) Mr. Eccles has been assisting in~~ the ~~operations~~Merger ~~and~~Agreement, ~~growth~~post ofan ~~Jackson~~announced ~~Drugs~~30:1 ~~Pharmacy.~~reverse ~~His~~split, ~~duties~~issuable ~~have included day~~ to ~~day~~the ~~operations~~Vapor asGroup ~~well~~Shareholders asunder ~~developing~~the ~~and~~terms ~~executing employee training, inventory management~~ and ~~working~~conditions ~~with~~of the ~~compliance~~Merger ~~with DEA Standards regarding the pharmaceuticals that are dispensed.~~Agreement;

~~Currently~~(b) The quantity of shares of Series B Preferred Stock issuable in connection with the Merger Agreement shall be calculated by dividing the 750,000,000 ~~Mr.~~shares ~~Eccles~~of isCommon Stock by the ~~Company’s~~100:1 ~~sole~~convertibility ~~officer~~feature ~~and~~of ~~director.~~the Series B Preferred Stock, such that only 7,500,000 shares of Series B Preferred Stock shall be issued as the consideration under the Merger Agreement;

~~Off~~(c) ~~Balance~~The ~~Sheet~~7,500,000 ~~Arrangements~~shares of Series B Preferred Stock shall remain authorized but unissued until after the effective date of the announced 30:1 reverse split of the Company’s Common Stock, at which time said issuance of Series B Preferred Stock shall be further reduced 30:1 similar to the effect of the reverse split, such that only 250,000 shares of Series B Preferred Stock are issued as the sole consideration to the Vapor Group Shareholders for entering into the Merger Agreement.

As(d) Any and all shares of ~~December~~Series ~~31,~~B ~~2012,~~Preferred weStock ~~had~~shall nobe ~~material~~restricted ~~off-balance~~from ~~sheet~~any ~~arrangements~~conversion into shares of Common Stock by any holder thereof for a period of eighteen (18) months from the date of their issuance.

InOn ~~the~~March ~~ordinary~~13, ~~course of business~~2014, wethe ~~enter~~Company ~~into~~announced ~~agreements~~by ~~with~~filing ~~third~~form ~~parties~~8-K ~~that~~on ~~include~~March ~~indemnification provisions which~~18, ~~in our judgment~~2014, ~~are~~that ~~normal~~the ~~and~~aforementioned ~~customary~~30:1 ~~for~~reverse ~~companies~~split inof ~~our~~the ~~industry~~Company’s ~~sector.~~Common ~~These~~Stock ~~agreements~~had ~~are~~been ~~typically~~cancelled. ~~with~~As ~~business~~a ~~partners,~~result and ~~suppliers.~~consistent ~~Pursuant~~with tothe ~~these~~intent ~~agreements,~~of wethe ~~generally~~prior ~~agree~~announcement toamending ~~indemnify,~~the ~~hold~~terms ~~harmless,~~ and ~~reimburse~~conditions ~~indemnified~~of ~~parties~~the ~~for~~Merger ~~losses~~Agreement, ~~suffered or incurred by~~ the ~~indemnified~~aforementioned ~~parties~~(see ~~with~~“(c)” ~~respect~~above) ~~to our product candidates~~250,000 ~~use~~shares of ~~such~~Series ~~product~~B ~~candidates,~~Preferred orStock ~~other~~granted ~~actions~~in ~~taken~~consideration ~~or omitted by us. The maximum potential amount~~ of ~~future~~the ~~payments~~Merger weAgreement, ~~could~~as becalculated ~~required~~“post toreverse ~~make~~split” ~~under~~had ~~these~~there ~~indemnification~~been ~~provisions~~one, isshall ~~unlimited.~~be Weissued ~~have~~on ~~not~~the ~~incurred~~books ~~material~~and ~~costs~~records toof ~~defend~~the ~~lawsuits~~Company ~~or settle claims related~~ to ~~these indemnification provisions. As a result,~~ the ~~estimated~~Shareholders ~~fair value~~ of ~~liabilities~~Vapor ~~relating to these provisions is minimal~~Group. ~~Accordingly,~~Said weissuance ~~have~~by noresolution ~~liabilities~~of ~~recorded~~the ~~for~~Board ~~these~~of ~~provisions~~Directors asoccurred ofon ~~December~~March 3117, ~~2012~~2014.

1923

InAcquisition ~~the~~and ~~normal~~Sale ~~course~~ of ~~business,~~Ownership weInterest ~~may~~In beAmerican ~~confronted with issues or events that may result in a contingent liability. These generally relate to lawsuits~~Vaporizer, claims, environmental actions or the actions of various regulatory agencies. We consult with counsel and other appropriate experts to assess the claim. If, in our opinion, we have incurred a probable loss as set forth by accounting principles generally accepted in the U.S., an estimate is made of the loss and the appropriate accounting entries are reflected in our financial statements.LLC

~~Effects~~On March 31, 2014, the Company entered into an Acquisition Agreement by and among the Company, American Vaporizer, LLC, a Delaware limited liability company ("American Vaporizer") and two of ~~Inflation~~the three membership unit holders of American Vaporizer (the “Unit Holders”), pursuant to which the Company, as a membership unit holder, would increase its ownership interest from its previous twenty-five percent (25%) to fifty-one percent (51%), by acquiring an additional twenty-six membership units of American Vaporizer (the “Membership Units”) from the other two Unit Holders. Under Florida law, the Agreement was effective immediately and American Vaporizer became a majority-owned subsidiary of the Company.

~~During~~On June 23, 2014, the ~~periods~~Company entered into an agreement wherein it sold to S.E. Naples, Inc. (“S.E. Naples”) all of its 51% ownership interest in American Vaporizer to return for ~~which~~an ~~financial~~8% ~~information~~interest isbearing ~~presented~~promissory note in the principal amount of $400,000 (the “Sale”) and other terms and conditions. Under the agreement, the Company’s ~~business~~agreed to assist S.E. Naples in marketing of the American Vaporizer brand, American Smoke, for ninety (90) days. As a result of the Sale, American Vaporizer ceased to be a subsidiary of the Company, and the financial results of operations ~~have~~and ~~not~~financial ~~been~~statements ~~materially~~of ~~affected~~American Vaporizer were no longer consolidated with those of the Company. Investments made by ~~inflation~~the Company in American Vaporizer under the terms and conditions of its Acquisition Agreement and loans made in conjunction therewith, shall remain obligations of American Vaporizer for repayment to the Company. In connection with the Sale, the Company cancelled any aforementioned incentive investments that it was to make in American Vaporizer under the Acquisition Agreement.

~~ITEM~~Acquisition ~~7A.~~of ~~Quantitative~~VGR ~~and~~Media, ~~Qualitative Disclosures About Market Risk~~Inc.

~~Our~~On ~~Company~~December is31, a2014, ~~smaller~~the ~~reporting~~Company ~~company~~entered asinto ~~defined~~an byAcquisition ~~Rule~~Agreement ~~12b-2~~by ofand among the ~~Exchange~~Company, ~~Act~~VGR Media, Inc., a Florida corporation ("VGR Media") and asthe ~~such~~shareholders of VGR Media, iseach ~~not~~an ~~required~~individual, pursuant to ~~provide~~which the ~~information~~Company ~~required~~would ~~under~~acquire one hundred percent (100%) of VGR Media from its shareholders (the “Ownership Interest”). The result of this ~~item~~Agreement is that VGR Media, Inc. became a wholly-owned subsidiary of the Company.

~~ITEM~~Per 8the Acquisition Agreement, in exchange for an aggregate of one hundred percent (100%) of the issued and outstanding capital stock of VGR Media, Inc. ~~FINANCIAL~~owned ~~STATEMENTS~~by ~~AND~~its ~~SUPPLEMENTARY~~shareholders, ~~DATA~~which consists of three hundred and fifty million (350,000,000) shares of restricted common stock of VGR Media, Inc.: (i) the Company will acquire the Ownership Interest (i) in exchange thereof, the Company will issue to them an aggregate one hundred thousand (100,000) shares of its Series B preferred stock which cannot be converted into shares of common stock until December 31, 2015; and (ii) the Company will assume all assets and liabilities of VGR Media, including licenses, equipment, product designs, marketing and sale materials, logos, trademarks, copyrights and websites, and trade and debt obligations.

~~Financial statements are included and may be found at pages F-1 through F-10.~~24

~~ITEM~~The 9shares of the Company are being issued to the shareholders of VGR Media, Inc., ~~CHANGES~~in INreliance ~~AND~~on ~~DISAGREEMENTS~~Section ~~WITH~~4(2) ~~ACCOUNTANTS~~and ONRegulation ~~ACCOUNTING~~D ~~AND~~of ~~FINANCIAL~~the ~~DISCLOSURE~~United States Securities Act of 1933, as amended (the “Securities Act”). The shares of Series B preferred stock will not been registered under the Securities Act or under any state securities laws and may not be offered or sold without registration with the United States Securities and Exchange Commission or an applicable exemption from the registration requirements. The shareholders of VGR Media, Inc. acknowledged that the securities to be issued have not been registered under the Securities Act, that they understood the economic risk of an investment in the securities, and that they had the opportunity to ask questions of and receive answers from the Company’s management concerning any and all matters related to acquisition of the securities.

~~There~~As ~~were~~a noresult ~~changes~~of the Acquisition Agreement in orwhich ~~disagreements~~100,000 ~~with~~shares ~~accountants~~of onthe ~~accounting~~Company’s orSeries ~~financial~~B ~~disclosure~~preferred ~~matters~~stock were issued, there is one million, three hundred and fifty thousand (1,350,000) shares of preferred stock of the Company issued and outstanding, consisting of one million (1,000,000) shares of Series A preferred stock and three hundred and fifty thousand (350,000) shares of Series B preferred stock. As of the date of this Annual Report the 100,000 shares of Series B preferred stock to be issued per the Acquisition Agreement have been issued and are outstanding.

~~ITEM~~Beneficial ~~9A.~~Ownership ~~CONTROLS~~Chart ~~AND~~Following ~~PROCEDURES~~Acquisition of VGR Media, Inc.

~~Evaluation~~The following two tables set forth certain information, as of ~~Disclosure~~the ~~Controls~~date of this Annual Report, with respect to the beneficial ownership of the outstanding preferred stock and ~~Procedures~~common stock by: (i) any holder of more than five (5%) percent; (ii) each of the Company’s executive officers and directors; and (iii) the Company’s directors and executive officers as a group. Except as otherwise indicated, each of the stockholders listed below has sole voting and investment power over the shares beneficially owned. Unless otherwise indicated, each of the stockholders named in the table below has sole voting and investment power with respect to such shares of common stock. Beneficial ownership consists of a direct interest in the shares of common stock, except as otherwise indicated.

Pursuant to Rule 13a-15(b) under the Securities Exchange Act of 1934 ("Exchange Act"), the Company's Chief Executive Officer and Chief Financial Officer evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined under Rule 13a-15(e) under the Exchange Act) as of the end of the period covered by this report. 25

~~Based~~Preferred ~~upon~~Stock: ~~that~~Unless ~~evaluation~~otherwise indicated, ~~they~~each ~~concluded~~of ~~that~~ the ~~Company’s~~stockholders ~~disclosure~~named ~~controls~~in ~~and~~the ~~procedures~~table ~~were~~below ~~effective~~has assole ofvoting ~~December~~and ~~31,~~investment ~~2012~~power towith ~~ensure~~respect ~~that information required~~ to besuch ~~disclosed~~shares byof the ~~Company~~preferred instock. ~~the~~As ~~reports~~of ~~that~~ the ~~Company~~date ~~files~~of orthis ~~submits~~Annual ~~under the Exchange Act~~Report, isthere ~~recorded,~~are ~~processed~~1, ~~summarized and reported~~350,000 ~~within~~shares ~~the~~of ~~time~~preferred ~~periods~~stock ~~specified~~issued ~~in the Commission’s rules~~ and ~~forms, and that such information is accumulated and communicated properly to allow timely decisions regarding required disclosure~~outstanding.

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company's annual or interim financial statements will not be prevented or detected on a timely basis.

Name of Beneficial Owner & Shares Issued and Outstanding	Number of Shares Beneficially Owned			Percentage Beneficially Owned

Series A Preferred Stock (1,000,000)

Dror Svorai 3901 SW 47 Avenue Suite 415 Davie, Florida 33314		1,000,000 (1	)		100	%

Series B Preferred Stock (350,000,000)

Dror Svorai 3901 SW 47 Avenue Suite 415 Davie, Florida 33314		262,500 (1	)		75	%

Yaniv Nahon 3901 SW 47 Avenue Suite 415 Davie, Florida 33314		87,500 (1	)		25	%

Jorge Schcolnik 3901 SW 47 Avenue Suite 415 Davie, Florida 33314		-0-			-0-

The Company believes there are no material weaknesses in internal controls and procedures parting that the Company believes it has sufficient personnel with expertise in the area of SEC, generally accepted accounting principles (GAAP) and tax accounting procedures. __________________

20(1) Each share of Series A Preferred Stock has voting rights equivalent to 10,000 shares of common stock in any election of the shareholders for any purpose and is not convertible into common stock. Each share of Series B Preferred Stock is convertible into 1,800 shares of common stock and has voting rights equivalent to 1,800 shares of common stock in any election of the shareholders for any purpose.

~~Management's Report on Internal Control Over Financial Reporting~~26

~~Management~~Common ofStock: ~~the~~Unless ~~Company~~otherwise isindicated, ~~responsible~~each ~~for~~of ~~establishing~~the ~~and~~stockholders ~~maintaining~~named ~~adequate internal control over financial reporting as defined~~ in ~~Rules 13a-15(f) and 15d-15(f) under~~ the ~~Exchange~~table ~~Act.~~below ~~The~~has ~~Company's~~sole ~~internal~~voting ~~control~~and ~~over~~investment ~~financial~~power ~~reporting~~with isrespect ~~designed~~ to ~~provide~~such ~~reasonable~~shares ~~assurance~~of ~~regarding~~common ~~the~~stock. ~~reliability~~As of ~~financial reporting and~~ the ~~preparation~~date of ~~financial~~this ~~statements~~Annual ~~for~~Report, ~~external~~there ~~purposes~~are in2,658,813,601 ~~accordance~~shares ~~with accounting principles generally accepted in the United States~~ of ~~America~~common ~~("GAAP").~~stock ~~The~~issued ~~Company's internal control over financial reporting includes those policies~~ and ~~procedures that:~~outstanding.

· pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; · provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and

Name of Beneficial Owner	Number of Shares Beneficially Owned		Percentage Beneficially Owned (1)


Dror Svorai 3901 SW 47 Avenue Suite 415 Davie, Florida 33314		-0-		-0-

Yaniv Nahon 3901 SW 47 Avenue Suite 415 Davie, Florida 33314		-0-		-0-

Jorge Schcolnik 3901 SW 47 Avenue Suite 415 Davie, Florida 33314		1,000,000		1	%

5% or Greater Owners		(None)

· provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.____________

~~Because~~(1) ofBased ~~its~~on ~~inherent~~the ~~limitations,~~number ~~internal control over financial reporting may not prevent or detect misstatements. Also, projections~~ of ~~any~~shares ~~evaluation~~ of ~~effectiveness~~common tostock ~~future~~issued ~~periods~~and ~~are~~outstanding ~~subject~~as ~~to the risk that controls may become inadequate because~~ of ~~changes in conditions, or that~~ the ~~degree~~date of ~~compliance~~this ~~with~~Annual ~~the policies or procedures may deteriorate~~Report.

In connection with the preparation of our annual financial statements, we have assessed the effectiveness of internal control over financial reporting as of December 31, 2012, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission, or the COSO Framework. Management’s assessment included an evaluation of the design of our internal control over financial reporting and testing of the operational effectiveness of those controls. Based on this evaluation, management has determined that as of December 31, 2012, our internal controls over financial reporting were effective and that there were no material weaknesses in our internal control over financial reporting.27

~~Changes~~All the above securities mentioned qualified for exemption under Section 4(2) of the Securities Act since the issuance of securities by us did not involve a public offering. The offering was not a “public offering” as defined in ~~Internal~~Section ~~Controls~~4(2) ~~Over~~due ~~Financial~~to ~~Reporting~~the insubstantial number of persons involved in the transaction, size of the offering, manner of the offering and number of securities offered. We did not undertake an offering in which we sold a high number of securities to a high number of investors. In addition, these shareholders had the necessary investment intent as required by Section 4(2) since they agreed to and received share certificates bearing a legend stating that such securities are restricted pursuant to Rule 144 of the Securities Act. This restriction ensures that these securities would not be immediately redistributed into the market and therefore not be part of a “public offering.” Based on an analysis of the above factors, we have met the requirements to qualify for exemption under Section 4(2) of the Securities Act for this transaction.

~~During~~Entry ~~the~~into ~~fourth~~Private ~~quarter~~Placement ~~ended~~with ~~December~~Magna ~~31,~~Equities ~~2012~~II, ~~there~~LLC ~~were~~(formerly noHanover ~~significant~~Holdings ~~changes in internal controls of the Company~~I, ~~or other factors that could significantly affect these controls subsequent to the date of their evaluation.~~LLC)

~~ITEM~~On 9BApril 29, 2014, the Company closed a private placement whereby it entered into a securities purchase agreement, dated April 29, 2014 (the “Purchase Agreement”), with Magna Equities II, LLC (formerly Hanover Holdings I, LLC) (“Magna”), an affiliate of Magna Group. ~~OTHER~~Pursuant ~~INFORMATION~~to the Purchase Agreement, the Company sold Magna four (4) 8% senior convertible promissory notes in aggregate principal amount of $1,342,391.17 million (collectively, the “Convertible Notes”, or individually, a “Convertible Note”) due twelve months from the date of the Convertible Notes’ issuance. The Convertible Notes were purchased by Magna for $1,235,000. A copy of the Purchase Agreement and the Convertible Notes are attached as Exhibits to the Current Report on Form 8-K, filed by the Company with the U.S. Securities Exchange Commission on May 6, 2014.

~~None~~On October 24, 2014, the Company made a prepayment (the “Prepayment”) to Magna to be applied against the Convertible Notes in the amount of $75,000. On October 27, 2014, the Company entered into a Side Letter Agreement with Magna under which the Company and Magna agreed to allocate the Prepayment towards the principal amount due under the Convertible Note with a $480,000 purchase price. As such, the outstanding principle amount due under the Convertible Note with a Purchase Price of $480,000 was reduced accordingly. Further, the Side Letter Agreement provides that the fixed conversion price under each of the Convertible Notes will be amended to reflect that the conversion price will be equal to a 30% discount from the lowest trading price in the five (5) trading days prior to conversion, subject to adjustment. The Side Letter Agreement also makes various modifications to the Convertible Notes, including, without limitation, the removal of the clause in Section 3.19 of each Convertible Note, which stated: “Trading Below Premium. If, at any time after one hundred and eighty (180) calendar days after the Issue Date, the stock is trading below $0.18, the Company will be considered in default.”

21Additionally, the Side Letter Agreement provides for the issuance of a new 8% senior convertible promissory note was by the Company to Magna in the principle amount of $35,760.95, for a purchase price of $38,870.69 (the “New Note”). The New Note was issued in accordance with the terms and conditions of the Purchase Agreement, contains substantially the same terms and conditions as the Convertible Notes, and has a maturity date of October 27, 2015.

~~PART III~~28

~~ITEM~~On 10February 12, 2015 the Company entered into a further Side Letter Agreement with Magna under which Section 8.0. ~~DIRECTORS~~of the Purchase Agreement, ~~EXECUTIVE~~dated ~~OFFICERS~~April 29, ~~AND~~2014, ~~CORPORATE~~between ~~GOVERNANCE~~them shall only apply to payments due pursuant to quarterly reports filed by the Company up to and including that quarterly report filed for the period ending June 30, 2014. Moreover, any amount due to Magna under said Section of the Purchase Agreement pursuant to a quarterly report filed for a period ending subsequent to June 30, 2014 shall no longer be considered due or payable. For the avoidance of doubt, the only payment due by the Company pursuant to said Section shall pertain to the aforementioned Note dated October 27, 2014 in principal amount of $38,870.69 issued to Magna pursuant to those certain fees earned under said Section of the Purchase Agreement per the Company’s quarterly report filed for the period ending June 30, 2014.

~~Directors~~Moreover, ~~Executive~~the ~~Officers~~Side Letter Agreements provide that except as otherwise expressly provided therein, ~~Promoter~~the Purchase Agreement, the Convertibles Notes, and ~~Control~~the ~~Persons~~related Escrow Agreement, dated April 29, 2014, are, and shall continue to be, in full force and effect and are thereby ratified and confirmed in all respects, including, without limitation, all representations and warranties made by each of the Company and Magna.

The ~~below~~aforementioned ~~table~~issuance ~~lists~~of ~~all~~the ~~current~~New ~~officers~~Note ~~and~~to ~~directors~~Magna, dated October 27, 2014, was exempt from the registration requirements of the ~~Company. All~~Securities ~~officers~~Act ~~serve~~of at1933, as amended (the ~~discretion~~“Securities Act”), pursuant to the exemption for transactions by an issuer not involving any public offering under Section 4(a)(2) of the ~~Board~~Securities Act and Rule 506 of ~~Directors~~Regulation D promulgated under the Securities Act (“Regulation D”). The ~~term~~Company ofmade ~~office~~this ofdetermination ~~each~~based on the representations of ~~our~~Magna ~~directors~~in ~~expire~~the atPurchase ~~our~~Agreement ~~next~~that ~~Annual~~Magna ~~Meeting~~is an “accredited investor” within the meaning of ~~Shareholders~~Rule or501 ~~until~~of ~~their~~Regulation ~~successors~~D ~~are~~and ~~duly~~has ~~elected~~access to information about its investment and ~~qualified~~about the Company.

NAME		AGE		POSITION
Joe Eccles		38		President/CEO and Director

Change in Control of the Company

~~The~~As ~~business~~previously ~~background~~cited, ~~descriptions~~on September 3, 2013, the majority shareholder of the ~~newly~~Company ~~appointed~~and ~~director~~Corporate Excellence Consulting, Inc., a Florida corporation (collectively, the “Sellers”), who were the record holders respectively of 165,000,000 shares of restricted common stock (61.11% of the issued and ~~officer~~outstanding shares prior to issuances connected to the Merger Agreement) and 1,000,000 shares of the Series A Preferred Stock of the Company, entered into a share purchase agreement (the “Share Purchase Agreement”) with Dror Svorai, an individual, (the “Buyer”), and the future President and CEO of the Company (post-Merger Agreement). In accordance with the Share Purchase Agreement, the Sellers agreed to sell and transfer over time the 165,000,000 shares of restricted common stock and the 1,000,000 shares of Series A Preferred Stock of the Company to the Buyer for a total purchase price of $115,000. The Share Purchase Agreement provides that the purchase price be paid on or before February 13, 2014 and that as the purchase price is being paid by the Buyer, the shares of common and preferred stock are to be released pro-rata to the Buyer by the Sellers. The Share Purchase Agreement was completed and paid-in-full within its terms, and the sale and transfer of the common stock and Series A Preferred Stock to the Buyer was finalized on February 20, 2014. The sale and purchase of the 165,000,000 shares of common stock of the Company constitutes 49.34% of the total issued and outstanding shares of the Company of 334,381,399 as ~~follows:~~of April 11, 2014, and the sale and purchases of the 1,000,000 shares of Series A Preferred Stock constitutes 100% of the total issued and outstanding shares of preferred stock which has over 50% voting control of the Company. As a result, Dror Svorai, an individual, is the controlling shareholder of the Company.

Joe Eccles is a thirty eight year old business executive who graduated with Honors from Suffolk College in New York in 1997. Mr. Eccles has spent his career in business management. Most recently, for more than the past five years (with the exception of a two month sabbatical he took to do some missionary work) Mr. Eccles has been assisting in the operations and growth of Jackson Drugs Pharmacy. His duties have included day to day operations as well as developing and executing employee training, inventory management and working with the compliance with DEA Standards regarding the pharmaceuticals that are dispensed.29

~~Currently,~~Securities ~~Mr.~~Authorized ~~Eccles~~for isIssuance ~~the~~under ~~Company’s~~Equity ~~sole~~Compensation ~~officer and director.~~Plans

~~There~~We ~~are~~did nonot ~~arrangements~~have ~~or understandings between our officers and directors and~~ any ~~other~~equity ~~person~~compensation ~~pursuant to which any director or officer was or is to be selected as a director or officer, and there are no arrangements,~~ plans ~~or understandings~~ as ~~to whether non-management shareholders will exercise their voting rights to continue to elect the current board~~ of ~~directors.~~December ~~There are also no arrangements~~31, ~~agreements~~2014. orOur ~~understandings~~Board toof ~~our~~Directors ~~knowledge between non-management shareholders that~~ may ~~directly~~adopt oran ~~indirectly~~equity ~~participate~~compensation plan in ~~or influence~~ the ~~management of our affairs~~future.

~~Family~~Purchases ~~Relationships~~of Equity Securities by the Issuer and Affiliated Purchasers

None.

~~Other~~ITEM ~~Directorships~~6. SELECTED FINANCIAL DATA.

~~Other~~We ~~than~~are ~~as indicated within this section none of the Company's directors hold or have been nominated to hold~~ a ~~directorship~~smaller inreporting ~~any~~ company ~~with~~as adefined ~~class~~by ofRule ~~securities registered pursuant to Section 12 of the Exchange Act~~ 229.10(~~the "Act"~~f) ~~or subject to the requirements of Section 15~~(d1) and ofare ~~the~~not ~~Securities~~required ~~Act~~to ofprovide ~~1933~~information ~~or any or any company registered as an investment company~~ under ~~the~~this ~~Investment Company Act of 1940~~item.

~~Involvement In Certain Legal Proceedings~~30

~~During~~ITEM ~~the~~7. ~~past~~MANAGEMENT’S ~~five~~DISCUSSION ~~years,~~AND ~~the~~ANALYSIS ~~Company's~~OF ~~officers~~FINANCIAL ~~and~~CONDITION ~~directors~~AND ~~have~~RESULTS ~~not~~OF been involved in any of the following: (1) any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time; (2) any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses); (3) being subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; and (4) being found by a court of competent jurisdiction (in a civil action), the Commission or the Commodities Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacatedOPERATIONS.

22Overview of the Vapor Group, Inc.

~~Committees~~The principal business of Vapor Group, Inc., www.vaporgroup.com, (“Vapor Group”) is in the ~~Board~~designing, developing, manufacturing and marketing high quality, vaporizers and e-cigarettes and accessories which use state-of-the-art electronic technology and specially formulated, “Made in the USA” e-liquids, which may or may not contain nicotine. Vapor Group offers a range of products and unique e-liquid flavors that it believes are unmatched in its industry. Its products are marketed under the Vapor Group, Total Vapor, Vapor 123, and Vapor Products brands, each of which is also a wholly-owned subsidiary of the same name. It sells nationwide through distributors, wholesalers and directly to consumers through its own websites and direct response advertising, and also owns as a wholly-owned subsidiary, Total Vapor Opportunities, Inc., a pending franchisor of “Total Vapor” retail stores in the continental U.S. In addition, Vapor Group owns as a wholly-owned subsidiary, VGR Media, Inc., www.vgr-media.com, a full service interactive advertising agency, offering Vapor Group’s products, and more generally customized performance marketing solutions to help marketers of consumer products acquire new customers and maximize their return on investment. VGR Media operates in the U.S. and sells domestically and internationally.

~~None~~Operating Expenses:

~~Board~~Operating ~~Meetings~~expenses increased by $2,942,127 or 343% to $3,798,786 for the year ended December 31, 2014 from $856,659 for the year ended December 31, 2013. The increase in operating expenses was primarily due to an increase in Advertising and ~~Committees;~~Promotion, ~~Annual~~Commissions ~~Meeting~~and ~~Attendance~~General and administrative expenses.

~~During~~Loss ~~2012,~~from ~~the Company did not conduct any formal Board meetings and conducted business through Written Actions.~~Operations:

~~Indemnification~~Loss from continuing operations was $740,369 for the year ended December 31, 2014 compared to a profit from continuing operations of $267,614 for the year ended December 31, 2013 mainly due to the increase in Operating Expenses described above.

~~The~~Interest General Corporation Law of Florida provides that directors, officers, employees or agents of Florida corporations are entitled, under certain circumstances, to be indemnified against expenses (including attorneys' fees) and other liabilities actually and reasonably incurred by them in connection with any suit brought against them in their capacity as a director, officer, employee or agent, if they acted in good faith and in a manner they reasonably believed to be in or not opposed to the best interests of the corporation, and with respect to any criminal action or proceeding, if they had no reasonable cause to believe their conduct was unlawful. This statute provides that directors, officers, employees and agents may also be indemnified against expenses (including attorneys' fees) actually and reasonably incurred by them in connection with a derivative suit brought against them in their capacity as a director, if they acted in good faith and in a manner they reasonably believed to be in or not opposed to the best interests of the corporation, except that no indemnification may be made without court approval if such person was adjudged liable to the corporation.Income:

~~Our~~The ~~Certificate~~company ofhad ~~Incorporation~~no ~~provides~~interest ~~that~~income ~~we shall indemnify any and all persons whom we shall have power~~ to ~~indemnify to the fullest extent permitted by the Florida Corporate Law~~report. Article VII of our By-Laws provides that we shall indemnify our authorized representatives to the fullest extent permitted by the Florida Law. Our By-Laws also permit us to purchase insurance on behalf of any such person against any liability asserted against such person and incurred by such person in any capacity, or out of such person's status as such, whether or not we would have the power to indemnify such person against such liability under the foregoing provision of the by-laws.

~~The~~Net ~~foregoing discussion of indemnification merely summarizes certain aspects of indemnification provisions and is limited by reference to the above discussed sections of the Florida Corporation Law.~~Loss:

~~The~~Net ~~Company's~~Loss ~~Articles~~was of$804,828 ~~Incorporation~~for ~~and~~the ~~Bylaws~~year ~~provide~~ended ~~that~~December ~~the~~31, ~~Company~~2014 ~~may~~compared ~~indemnify~~ to ~~the~~a ~~full~~net ~~extent~~profit of ~~its power to do so~~$161,720 ~~all directors, officers, employees, and/or agents. Insofar as indemnification by the Company~~ for ~~liabilities arising under~~ the ~~Securities~~year ~~Act~~ended ~~may~~December be31, ~~permitted~~2013 tomainly ~~officers~~due ~~and directors of the Company pursuant~~ to the ~~foregoing~~increase ~~provisions or otherwise, the Company is aware that~~ in ~~the~~Operating ~~opinion~~Expenses ofdescribed ~~the Commission, such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable~~above.

~~ITEM 11. EXECUTIVE COMPENSATION.~~31

~~Summary~~Going ~~Compensation~~Concern ~~Table~~

~~The~~As ~~following~~reflected ~~table~~in ~~lists~~ the ~~compensation~~accompanying ofconsolidated ~~the~~financial ~~Company's~~statements, ~~principal executive officers~~ for the ~~years~~year ended December 31, ~~2012~~2014, ~~and~~the ~~2011. The~~Company ~~following~~had ~~information~~a ~~includes~~net ~~the~~loss ~~dollar~~and ~~value~~net ofcash ~~base~~used ~~salaries~~in operations of $804,828 ~~bonus~~and ~~awards~~($2,186,824), ~~the~~respectively, ~~number~~and a total stockholders’ deficit of ~~non-qualified~~$361,569. ~~Company~~These ~~Options~~matters ~~granted~~have ~~and~~raised ~~certain~~substantial ~~other~~doubt ~~compensation,~~about ifthe ~~any,~~Company's ~~whether~~ability ~~paid~~to orcontinue ~~deferred. The~~as ~~following~~a ~~information~~going ~~includes~~concern. Going forward, the ~~aggregated~~ability ~~Company~~of ~~Options~~the ~~issued~~Company to ~~the~~continue ~~Company's~~as ~~executive~~a ~~officers~~going ~~pursuant~~concern is dependent on its ability to ~~the~~raise ~~Merger~~additional capital, further implement or augment its business model and ~~those~~business ~~issued~~plan, ~~under~~and ~~the~~to ~~LTIP~~generate additional revenues.

23The consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

Name and Principal Position	Year	Salary($)		Bonus($)		Stock Awards($)			All Other Compensation($)		Total($)
Joel A. Young:	2012	$	0	$	0	$	0		$	0	$	0
President, Chief	2011	$	20,000	$	0	$	0		$	16,180	$	36,180
Executive Officer,	2010	$	0	$	0	$	0		$	33,190	$	33,190
Chief Financial Officer and Director
Vincent Beatty:	2011	$	0	$	0	$	0		$	0	$	0
Chief Executive Officer,	2010	$	0	$	0	$	10,000	(1)	$	0	$	10,000
President, Chief Financial Officer and Director	2009	$	0	$	0	$	0		$	0	$	0

LIQUIDITY AND CAPITAL RESOURCES

~~__________________~~As of December 31, 2014, we had net current liabilities of $3,553,250 compared to $855,009 as of December 31, 2013. Our balance of cash and cash equivalents at December 31, 2014 was $413,230 as compared to $48,177 on December 31, 2013.

~~(1)~~Operational ~~The~~cash Company issued 10,000,000 restricted shares of its common stock for services rendered, calculated based upon the aggregate grant date fair value computed in accordance with FASB ASC Topic 718. The shares were valued at $0.001 per share or $10,000.flow

We dohad ~~not~~operating ~~have~~cash ~~any~~outflows ~~employment~~in ~~agreements~~the ~~with~~year ~~any~~ended December 30, 2014 of ~~our~~$2,186,824, ~~officers~~and $236,567 in the year ended December 30, 2013. WeOur doprimary ~~not~~uses ~~contemplate~~of ~~entering~~cash ~~into~~have ~~any~~been ~~employment~~for ~~agreements~~marketing ~~until~~expenses ~~such~~and ~~time~~general asworking capital purposes. All cash we ~~begin~~received toover ~~attain~~the ~~profitable~~reported ~~operations~~periods has been expended in the furtherance of growing assets.

~~The~~Financing ~~compensation~~cash ~~discussed herein addresses all compensation awarded to, earned by, or paid to our named executive officer.~~flows

~~STOCK~~Going ~~OPTION~~forward, ~~AND~~we ~~OTHER~~may ~~COMPENSATION~~not ~~PLANS~~have sufficient resources to fully develop any new products or technologies or expand our inventory levels unless we are able to raise additional financing. We can make no assurances these required funds will be available on favorable terms, if at all. If additional capital is raised through the sale of equity or convertible debt securities, the issuance of such securities would result in dilution to our existing stockholders. Additionally, these conditions may increase costs to raise capital and/or result in further dilution. Our failure to raise capital when needed would adversely affect our business, financial condition and results of operations, and could force us to reduce or cease our operations.

~~The Company currently does not have a stock option or any other compensation plan for its executive officers or directors and has never had such a plan in the past.~~32

~~COMMITTEES~~We OFbelieve ~~THE~~that ~~BOARD~~we OFwill ~~DIRECTORS~~be able to meet the costs of growth and public reporting with funds generated from operations and additional amounts generated through debt and equity financing, Although management believes that the required financing to fund product development and increasing inventory levels can be secured at terms satisfactory to the Company, there is no guarantee these funds will be made available, and if funds are available, that the terms will be satisfactory to the Company.

WeManagement dobelieves ~~not~~that ~~currently~~the ~~have~~application anof ~~audit~~these ~~committee~~policies oron a ~~compensation~~consistent ~~committee~~basis enables us to provide useful and reliable financial information about our operating results and financial condition. Some of the critical accounting estimates are detailed below.

~~COMPENSATION~~Critical OFAccounting ~~DIRECTORS~~Estimates and New Accounting Pronouncements

~~Our~~Critical ~~directors~~Accounting ~~do not receive any direct compensation for their service on our board of directors. Any future director compensation will be determined by our compensation committee, once it is chartered.~~Estimates

~~COMPENSATION~~The ~~DISCUSSION~~preparation ~~AND~~of ~~ANALYSIS~~financial statements in accordance with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions that affect reported amounts and related disclosures in the financial statements. Management considers an accounting estimate to be critical if it requires assumptions to be made that were uncertain at the time the estimate was made, and if changes in the estimate or different estimates that could have been selected could have a material impact on our results of operations or financial condition.

~~There~~We isbase ~~currently~~our noestimates ~~compensation~~and ~~policy~~judgments inon ~~place~~our ~~for~~experience, ~~officers~~our orcurrent ~~directors~~knowledge, and our beliefs of what could occur in the ~~Company~~future, our observation of trends in the industry, information provided by our customers and information available from other sources. ~~The~~Actual ~~policy~~results ~~will~~may bediffer ~~addressed~~from ~~when~~these estimates under different assumptions or conditions. We have identified the ~~Company~~following ~~has~~accounting ~~raised~~policies ~~sufficient~~and ~~income~~estimates as those that we believe are most critical to ~~warrant~~our afinancial ~~policy~~condition and results of operations and that require management’s most subjective and complex judgments in estimating the effect of inherent uncertainties: share-based compensation expense, income taxes, and derivative financial instruments.

24Share-Based Compensation Expense. We plan to calculate share-based compensation expense for option awards and warrant issuances ("Share-based Awards") based on the estimated grant/issue-date fair value using the Black-Scholes-Merton option pricing model ("Black-Sholes Model"), and recognize the expense on a straight-line basis over the vesting period, net of estimated forfeitures. The Black-Scholes Model requires the use of a number of assumptions including volatility of the stock price, the weighted average risk-free interest rate, and the vesting period of the Share-based Award in determining the fair value of Share-based Awards. Although we believe our assumptions used to calculate share-based compensation expense are reasonable, these assumptions can involve complex judgments about future events, which are open to interpretation and inherent uncertainty. In addition, significant changes to our assumptions could significantly impact the amount of expense recorded in a given period.

~~SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT~~33

~~The~~Income ~~following~~Taxes. ~~table~~As ~~sets~~part ~~forth,~~of asthe process of ~~January~~preparing 8,our ~~2014~~consolidated financial statements, we will be required to estimate income taxes in each of the ~~number~~jurisdictions in which we operate. Our provision for income taxes is determined using the asset and ~~percentage~~liability ofapproach ~~shares~~to ofaccount ~~Common~~for ~~Stock~~income oftaxes. A current liability is recorded for the ~~Company,~~estimated ~~owned~~taxes payable for the current year. Deferred tax assets and liabilities are recorded for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of ~~record~~existing assets and ~~beneficially,~~liabilities byand ~~each~~their ~~person~~respective ~~known~~tax bybases. Deferred tax assets and liabilities are measured using the ~~Company~~enacted tax rates in effect for the year in which the timing differences are expected to ~~own~~be 5%recovered or ~~more~~settled. ofThe ~~such~~effect ~~stock,~~on ~~each~~deferred ~~director~~tax assets and liabilities of changes in tax rates or tax laws are recognized in the ~~Company~~provision for income taxes in the period that includes the enactment date. Valuation allowances are established, ~~and~~when bynecessary, ~~all~~to ~~executive~~reduce ~~officers~~deferred ~~and~~tax ~~directors~~assets ofto the ~~Company~~amount more-likely-than-not to be realized. Changes in valuation allowances will flow through the statement of operations unless related to deferred tax assets that expire unutilized or are modified through translation, asin which case both the deferred tax asset and related valuation allowance are similarly adjusted. Where a ~~group:~~valuation allowance was established through purchase accounting for acquired deferred tax assets, any future change will be credited or charged to income tax expense.

Name and Address	Number of Shares(1)		Percentage
Joel A. Young (2)		165,000,000		61.11	%
Vincent Beatty (3)		25,201,350		9.6	%
All officers and directors as a group (1 person)		165,000,000		61.11	%

The determination of our provision for income taxes requires significant judgment, the use of estimates, and the interpretation and application of complex tax laws. In the ordinary course of our business, there are transactions and calculations for which the ultimate tax determination is uncertain. In spite of our belief that we have appropriate support for all the positions taken on our tax returns, we acknowledge that certain positions may be successfully challenged by the taxing authorities. We determine the tax benefits more likely than not to be recognized with respect to uncertain tax positions. Although we believe our recorded tax assets and liabilities are reasonable, tax laws and regulations are subject to interpretation and inherent uncertainty; therefore, our assessments can involve both a series of complex judgments about future events and rely on estimates and assumptions. Although we believe these estimates and assumptions are reasonable, the final determination could be materially different than that which is reflected in our provision for income taxes and recorded tax assets and liabilities.

~~(1)~~New ~~The~~Accounting numbers and percentages set forth in these columns are based on 270,020,145 shares of Common Stock outstanding as of January 8, 2014. The number and percentage of units beneficially owned is determined in accordance with Rule 13d-3 of the Securities Exchange Act of 1934, and the information is not necessarily indicative of beneficial ownership for any other purpose. Under such rule, beneficial ownership includes any equity securities as to which the holder has sole voting power or investment power and also any shares that the holder has the right to acquire within 60 days.Pronouncements

In December 2011, FASB issued Accounting Standards Update (2"ASU") Mr2011-11, Balance Sheet - Offsetting. ~~Young's~~This ~~address~~guidance requires disclosures about offsetting and related arrangements for recognized financial instruments and derivative instruments. The standard is ~~4700~~effective ~~Hiatus~~for ~~Road,~~us ~~Suite~~as ~~252,~~of ~~Sunrise~~January 1, FL2013 ~~33351~~and will not materially impact our financial statement disclosures.

~~(3)~~In MrSeptember 2011, the FASB issued ASU 2011-08, "Testing Goodwill for Impairment." ~~Beatty's~~This ~~address~~guidance provides the option to evaluate prescribed qualitative factors to determine whether a calculated goodwill impairment test is ~~1205~~necessary. ~~Hillsboro~~The ~~Mile~~standard is effective for us as of January 1, ~~Suite~~2012 ~~203~~and will not materially impact on our financial condition, ~~Hillsboro~~results ~~Beach~~of operations, FLor ~~33062~~financial statement disclosures.

~~Section 16(a) Beneficial Ownership Reporting Compliance~~34

~~Section~~In 16May 2011, FASB issued Accounting Standards Update (a"ASU") 2011-05, Comprehensive Income: Presentation of Comprehensive Income, to allow an entity the ~~Exchange~~option ~~Act~~to ~~requires~~present ~~directors~~the ~~and~~total ~~certain~~of ~~officers~~comprehensive income, the components of net income, and the ~~Company~~components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements. In both choices, asan ~~well~~entity asis ~~persons~~required ~~who~~to ~~own~~present ~~more~~each ~~than~~component ~~10%~~of net income along with total net income, each component of other comprehensive income along with a ~~registered~~total ~~class~~for other comprehensive income, and a total amount for comprehensive income. ASU 2011-05 eliminates the option to present the components of other comprehensive income as part of the ~~Company~~statement of changes in stockholders’s equity. ~~securities~~The ~~("Reporting~~amendments ~~Persons"),~~do tonot ~~file~~change ~~reports~~the ~~with~~guidance regarding the ~~Commission~~items that must be reported in other comprehensive income or when an item of other comprehensive income must be reclassified to net income. The ~~Company~~amendments ~~believes~~should ~~that~~be ~~during~~applied retrospectively, and is effective for fiscal ~~2011~~years and interim periods within those years, ~~all~~beginning ~~Reporting~~after ~~Persons~~December ~~timely~~15, ~~complied~~2011. ~~with~~Early ~~all~~adoption ~~filing~~is ~~requirements~~permitted. ~~applicable~~The adoption is not expected to ~~them~~have a material impact on the Company’s results of operations, financial position or cash flows.

~~ITEM~~In 13May 2011, the FASB issued ASU 2011-04, Fair Value Measurement: Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. ~~CERTAIN~~GAAP ~~RELATIONSHIPS~~and ~~AND~~IFRSs. ~~RELATED~~This ~~TRANSACTIONS~~ASU represents the converged guidance of the FASB and the IASB (the "Boards") on fair value measurement, ~~AND~~and ~~DIRECTOR~~results ~~INDEPENDENCE~~in common requirements for measuring fair value and for disclosing information about fair value measurements, including a consistent meaning of the term "fair value." These amendments change some of the terminology used to describe many of the existing requirements in U.S. GAAP for measuring fair value and for disclosing information about fair value measurements. The amendments should be applied prospectively, and they are effective during interim and annual periods beginning after December 15, 2011. Early application by public entities is not permitted. The adoption is not expected to have a material impact on the Company’s results of operations, financial position or cash flows.

~~Except~~Management ~~for~~does ~~the~~not ~~transactions~~believe ~~described~~there ~~below,~~would ~~none~~be ofa ~~our~~material ~~directors,~~effect ~~officers~~on ~~or principal shareholders, nor any associate or affiliate of~~ the ~~foregoing,~~accompanying ~~have~~financial ~~any~~statements ~~interest,~~had ~~direct or indirect, in~~ any ~~transaction~~other orrecently inissued ~~any~~but ~~proposed~~not ~~transaction,~~yet ~~which~~effective ~~materially~~accounting ~~affected~~standards usbeen ~~during~~adopted in the ~~year~~current ~~ended December 31, 2012~~period.

~~ITEM~~Recent ~~14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.~~Events

As“Convertible ~~incurred~~Notes byPayable” ~~AvWorks~~and ~~Aviation~~“Accrued ~~Corp.~~Interest” Reductions

~~Audit~~Since ~~Fees.~~January ~~Harris F. Rattray~~1, ~~CPA~~2015, ~~billed~~ the Company has directly paid down in cash $8285,~~500~~987.99 ~~for~~in ~~professional~~principal, ~~services~~interest ~~rendered~~and ~~for~~additional ~~the~~fees ~~annual~~and ~~audit~~penalties ~~for~~ (the ~~year~~“Prepayments”) ~~ended~~specific ~~December~~to ~~31,~~early ~~2012,~~payments ~~the~~of ~~quarterly~~portions ~~review~~ of the ~~Company's~~outstanding ~~financial~~balances ~~statements~~of ~~for~~“Convertible ~~2012,~~notes payable” and ~~other~~“Accrued ~~services~~Interest“ ~~that~~stated ~~are~~on ~~normally~~its ~~provided~~Consolidated byBalance anSheet ~~accountant~~which infor ~~connection~~the ~~with~~period ~~statutory~~ended December 31, 2014 were $3,153,792 and ~~regulatory~~$245,751 ~~filings~~respectively, or ~~engagements~~a ~~for~~total ~~the~~of ~~fiscal year~~$3,399,543.

~~All~~In ~~Other~~addition, ~~Fees.~~from WeJanuary ~~incurred~~1, no2015 ~~other~~through ~~fees~~March 30, 2015, several respective note holders of various and specific “Convertible notes payable” converted $1,738,614 of the aggregate principal and interest, as reported for the ~~years~~period ended December 31, ~~2012~~2014, of the total of “Convertible notes payable” and ~~2011~~“Accrued Interest” into shares of common stock of the Company, in accordance with federal law and regulation (the “Conversions”).

2535

~~ITEM~~Adjusted ~~15. EXHIBITS~~for the Prepayments, ~~FINANCIAL~~net ~~STATEMENT~~of ~~SCHEDULES~~fees and penalties, and the Conversions, which together total $1,958,229 in reduction of such debt, the remaining outstanding balance of “Convertible notes payable” and “Accrued Interest” on the Consolidated Balance Sheet for the period ended December 31, 2014, would be reduced to $1,441,314 from $3,399,543.

~~Exhibits~~Increases in Authorized Shares of Common Stock

Exhibit No.		Description
31.1 and 31.2		Certification of Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14.*
32.1 and 32.2		Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*

As of the date of the filing of this Annual Report, March 30, 2015, the Company on separate occasions has filed two amendments to its Articles of Incorporation with State of Florida, each of which increased its authorized shares of common stock. The amendments were accepted by the State of Florida respectively on January 29, 2015 and March 10, 2015, thereby increasing the Company’s authorized shares from 2,500,000,000 to 3,500,000,000 and 4,500,000,000 respectively.

101.INS **		XBRL Instance Document
101.SCH **		XBRL Taxonomy Extension Schema Document
101.CAL **		XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF **		XBRL Taxonomy Extension Definition Linkbase Document
101.LAB **		XBRL Taxonomy Extension Label Linkbase Document
101.PRE **		XBRL Taxonomy Extension Presentation Linkbase Document

As reported on our Form 8-K filed December 4, 2014, and as reported in the Condensed Consolidated Financial Statements and Notes to the Condensed Consolidated Financial Statements of the Registrant filed on Form 10-Q for the quarter ended September 30, 2014 and filed with the SEC on November 14, 2014 (collectively referred to as the “Filings”), the Registrant had accumulated “convertible notes payable” in aggregate amount of $3,583,423 (the “Aggregate Convertible Notes Payable”) as of September 30, 2014. As previously noted, since the Filings, several holders of said convertible promissory notes (the “Notes” or individually, a “Note”) have exercised their right to convert all or a portion of their Note(s), in accordance with Federal and State law and regulation, into free-trading shares of common stock of the Registrant pursuant to the exemption from registration under Rule 144 of the Securities Act of 1933, as amended and per the terms of each holder’s respective Note.

~~______________________~~Also, as reported on Form 8-K filed with the SEC on February 4, 2015 by the Registrant, included in the documentation related to each Note is often the requirement that the Registrant authorize its transfer agent to reserve a quantity of shares of common stock in advance of any conversion of debt to shares of common stock in the event that the Note holder decides to convert all or any part of the outstanding balance of their respective Note (each a “Reserve”). Such Reserves are frequently variable in that downward changes in the market price of the Registrant’s common stock may trigger an increase in the quantity of shares required to be reserved by the Note holder. Moreover, such Notes allow the Note holder to convert all or a portion of the outstanding balance of each Note, in accordance with Federal and State law and regulation, without the approval of the Registrant, meaning that such conversions of debt into free trading shares of common stock of the Registrant are outside of the Registrant’s control.

* Filed Herewith36

**As ~~XBRL~~a ~~(Extensible~~result ~~Business~~of ~~Reporting~~the ~~Language)~~continuing ~~information~~low ismarket ~~furnished~~price ~~and~~of ~~not~~the ~~filed~~Registrant’s orcommon astock, ~~part~~several ofNote aholders ~~registration~~have ~~statement~~again orrequired ~~prospectus~~increases ~~for~~in ~~purposes~~their ofReserves ~~Sections 11~~equivalent orto 12many times the total possible number of shares that could be issued from their conversions greatly inflating the ~~Securities~~total ~~Act~~number of ~~1933,~~shares set aside as ~~amended,~~Reserves. isSuch ~~deemed~~increases ~~not~~have ~~filed~~repeatedly ~~for~~resulted ~~purposes~~in a significant reduction in the number of ~~Section 18~~authorized shares of common stock in the ~~Securities~~Registrant’s ~~Exchange~~treasury ~~Act~~which need to be available for general business purposes. Therefore to maintain an adequate quantity of ~~1934,~~common asstock ~~amended~~in its treasury for future uses, ~~and~~the ~~otherwise~~Registrant ishas ~~not~~been ~~subject~~required to ~~liability~~repeatedly ~~under~~amend ~~these~~its ~~sections~~Articles of Incorporation, to increase the number of shares of its authorized common stock.

26Off-Balance Sheet Arrangements

~~SIGNATURES~~As of December 31, 2014, we had no material off-balance sheet arrangements.

In the ordinary course of business, we enter into agreements with third parties that include indemnification provisions which, in our judgment, are normal and customary for companies in our industry sector. These agreements are typically with business partners, and suppliers. Pursuant to these agreements, we generally agree to indemnify, hold harmless, and reimburse indemnified parties for losses suffered or incurred by the ~~requirements~~indemnified parties with respect to our product candidates, use of ~~the~~such ~~Securities~~product ~~Exchange~~candidates, ~~Act~~or other actions taken or omitted by us. The maximum potential amount of ~~1934~~future payments we could be required to make under these indemnification provisions is unlimited. We have not incurred material costs to defend lawsuits or settle claims related to these indemnification provisions. As a result, the ~~Company~~estimated ~~has~~fair ~~duly~~value ~~caused~~of ~~this~~liabilities ~~report~~relating to bethese ~~signed~~provisions onis ~~its~~minimal. ~~behalf~~Accordingly, bywe ~~the~~have ~~undersigned~~no ~~thereunto~~liabilities ~~duly~~recorded ~~authorized~~for these provisions as of December 31, 2014.

	AvWorks Aviation Corp.
DATE: January 10, 2014	By:	/s/ Joe Eccles
		Joe Eccles Chief Executive Officer and CFO

In the normal course of business, we may be confronted with issues or events that may result in a contingent liability. These generally relate to lawsuits, claims, environmental actions or the actions of various regulatory agencies. We consult with counsel and other appropriate experts to assess the claim. If, in our opinion, we have incurred a probable loss as set forth by accounting principles generally accepted in the U.S., an estimate is made of the loss and the appropriate accounting entries are reflected in our financial statements.

27Impact of Inflation

~~HARRIS~~The F.business ~~RATTRAY~~will ~~CPA~~have to absorb any inflationary increases on development costs in the short-term, PLwith the expectation that it will be able to pass inflationary increases on costs on to our customers through price increases on the release of these new/enhanced products into the market and hence the management do not expect inflation to be a significant factor in our business.

~~2281 S Sherman Circle # B102~~37

~~Miramar~~ITEM FL7A. ~~33025~~QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

~~November~~Our 12Company is a smaller reporting company as defined by Rule 12b-2 of the Exchange Act, ~~2013~~and as such, is not required to provide the information required under this item.

~~The~~ITEM ~~Board~~8. ofFINANCIAL ~~Directors~~STATEMENTS AND SUPPLEMENTARY DATA.

~~AvWorks~~Financial ~~Aviation~~statements ~~Corp~~are included and may be found at pages F-1 through F-11.

~~Sunrise,~~ITEM ~~Florida~~9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.

~~REPORT~~On OFNovember ~~THE~~21, ~~INDEPENDENT~~2013, ~~REGISTERED~~the ~~PUBLIC~~PCAOB ~~ACCOUNTING~~revoked ~~FIRM~~the registration of the Company’s prior independent accountant, Harris F. Rattray, CPA (“Harris”), due to Harris’ violations of PCAOB rules and auditing standards in auditing the financial statements and PCAOB rules and quality control standards with respect to Harris’ clients.

WeOn ~~have~~November ~~audited~~27, ~~the accompanying consolidated balance sheets of~~2013, ~~AvWorks~~Harris ~~Aviation~~F. ~~Corp.~~Rattray, ~~(the~~CPA ~~"Company"~~(“Harris”) resigned as ofthe ~~December~~independent ~~31,~~registered ~~2012~~public ~~and~~accounting ~~2011,~~firm ~~and~~of the ~~related~~Company. ~~financial~~The ~~statements~~resignation ofwas ~~operations,~~accepted ~~changes~~by ~~in stockholders’ deficiency and cash flows for~~ the ~~years~~Board ~~then~~of ~~ended.~~Directors ~~These financial statements are the responsibility~~ of the Company’s ~~management.~~(the ~~Our responsibility is to express an opinion on these financial statements based on our audits~~“Board”).

WeOther ~~conducted~~than ~~our~~an ~~audits~~explanatory inparagraph ~~accordance~~included ~~with~~in ~~the~~Harris’ ~~standards~~audit ofreports for the ~~Public~~ Company's ~~Accounting~~fiscal ~~Oversight~~year ~~Board~~ended ~~(United~~December ~~States).~~31, ~~Those~~2012 ~~standards require that we plan~~ and ~~perform~~2011 ~~the~~relating ~~audits~~ to ~~obtain reasonable assurance about whether~~ the ~~financial~~uncertainty ~~statements are free~~ of ~~material~~the ~~misstatement. The~~ Company's isability ~~not required~~ to ~~have,~~continue ~~nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting~~ as a ~~basis~~going ~~for designing audit procedures that are appropriate in the circumstances~~concern, ~~but not for~~ the ~~purpose~~audit reports of ~~expressing~~Harris ~~an opinion~~ on the ~~effectiveness of the~~ Company’'s ~~internal control over~~ financial ~~reporting.~~statements ~~Accordingly,~~for wethe ~~express~~last notwo ~~such~~fiscal ~~opinion.~~years Anended ~~audit~~December ~~also includes examining~~31, on2011 ~~a test basis, evidence supporting the amounts~~ and ~~disclosures~~2012 inthrough ~~the~~September ~~financial~~30, ~~statements~~2013, ~~assessing~~did ~~the~~not ~~accounting~~contain ~~principles~~an ~~used~~adverse ~~and~~opinion ~~significant~~or ~~estimates~~a ~~made~~disclaimer byof ~~management~~opinion, asnor ~~well~~was asit ~~evaluating~~qualified ~~the~~or ~~overall~~modified ~~financial~~as ~~statement~~to ~~presentation.~~uncertainty, Weaudit ~~believe~~scope ~~that~~or ~~our~~accounting ~~audits provide a reasonable basis for my opinion~~principles.

InDuring ~~our~~the ~~opinion,~~Company's 2012 and 2011 fiscal years and through the ~~consolidated~~date ~~financial~~of ~~statements~~this ~~referred~~Current toReport ~~above~~on ~~present~~Form ~~fairly~~8-K, in(1) ~~all~~there ~~material~~were ~~respects,~~no ~~the~~disagreements ~~consolidated~~with ~~financial~~Harris ~~position~~on any matter of ~~AvWorks~~accounting ~~Aviation.~~principles ~~Corp.~~or practices, ~~and~~financial ~~Subsidiary~~statement asdisclosure, ofor ~~December~~auditing ~~31,~~scope ~~2012~~or ~~and~~procedure, ~~2011~~which, ~~and~~if not resolved to the ~~results~~satisfaction of ~~their~~Harris, ~~operations~~would ~~and~~have ~~their~~caused ~~cash~~Harris ~~flows~~to ~~for~~make reference to the ~~years~~subject ~~then~~matter ~~ended,~~of the disagreements in ~~conformity~~connection with ~~accounting~~their ~~principles~~report, ~~generally~~and ~~accepted~~(2) inthere ~~the~~were ~~United~~no ~~States~~“reportable events” as that term is defined in Item 304(a)(1)(v) of ~~America~~Regulation S-K.

The ~~accompanying consolidated financial statements have been prepared assuming that the~~ Company ~~will~~had ~~continue~~provided asHarris with a ~~going~~copy ~~concern.~~of ~~As more fully discussed in Note 2 to~~ the ~~consolidated~~foregoing ~~financial~~ statements, ~~the~~and ~~Company~~had ~~has~~requested ~~incurred~~that ~~accumulated~~Harris ~~net~~provide ~~losses~~it ofwith ~~$1,506,183~~a ~~and~~letter ~~needs~~addressed to ~~raise~~the ~~additional~~Securities ~~funds to meet its obligations~~ and ~~sustain~~Exchange ~~its~~Commission ~~operations.~~stating ~~These~~whether ~~conditions~~he ~~raise~~agrees ~~substantial~~with ~~doubt about~~ the ~~Company’s~~foregoing ~~ability to continue as a going concern~~statements. ~~Management’s~~A ~~plans~~copy inof ~~regard~~said toletter, ~~these~~was ~~matters~~filed ~~are~~on ~~described~~Form in8-K ~~Note~~filed 2.with ~~The consolidated financial statements do not include any adjustments that might result from~~ the ~~outcome~~SEC ofon ~~this~~January ~~uncertainty~~21, 2014.

/On January 9, 2014, the Company engaged Terry L. Johnson, CPA, as the Company's~~/Harris~~ Findependent accountant to audit the Company’s financial statements and to perform reviews of interim financial statements. ~~Rattray~~During the fiscal years ended December 31, 2011, December 31, 2012 and December 31, 2013 through January 9. 2014 neither the Company nor anyone acting on its behalf consulted with Terry L. Johnson, CPA regarding (i) either the application of any accounting principles to a specific completed or contemplated transaction of the Company, PLor the type of audit opinion that might be rendered by Terry L. Johnson, CPA on the Company's financial statements; or (ii) any matter that was either the subject of a disagreement with Harris or a reportable event with respect to Harris.

~~Miramar~~As of March 31, ~~Florida~~2014, the Company has re-filed audited financial statements for the year ended December 31, 2012 and re-reviewed quarterly financial statements for March 31, 2012, June 30, 2012, September 30, 2012, and March 31, 2013, June 30, 2013 and September 30, 2013, each of which was audited and/or reviewed respectively by Terry L. Johnson, CPA.

~~F-1~~There were no disagreements with Terry L. Johnson, CPA, or any other accountants on accounting or financial disclosure matters.

~~AVWORKS AVIATION CORP.~~38

~~BALANCE~~ITEM ~~SHEET~~9A. CONTROLS AND PROCEDURES.

	As of December 31,
	2012			2011
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	-		$	4,123
Inventory		-			45,100
Accounts receivable		-			19,030
Other current assets		-			3,653
Total current assets		-			71,906
FIXED ASSETS
Property, plant and equipment, net of depreciation		3,000			5,000
Total Fixed Assets		3,000			5,000
Loan to stockholders		-			20,138
TOTAL ASSETS	$	3,000		$	97,044
LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES
Cash overdraft	$	400		$	-
Accrued expenses		82,204			39,581
Notes payable		150,593			76,000
TOTAL CURRENT LIABILITIES		233,197			115,581
TOTAL LIABILITIES	$	233,197		$	115,581
STOCKHOLDERS' DEFICIT
Preferred stock, .001 par value, 10,000,000 shares authorised, none issued and outstanding
Common stock, 0.001 par value, 500,000,000 shares authorized, 270,020,145, and 262,310,000 issued and outstanding at December 31, 2012 and 2011 respectively,		270,020			262,310
Addional paid in capital		1,005,966			989,896
Accumulated deficit		(1,506,183	)		(1,270,470	)
TOTAL STOCKHOLDERS' DEFICIT		(230,197	)		(18,537	)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$	3,000		$	97,044

Evaluation of Disclosure Controls and Procedures

~~The~~Pursuant ~~accompaying~~to ~~notes~~Rule ~~are~~13a-15(b) anunder ~~integral~~the ~~part~~Securities Exchange Act of ~~these~~1934 ~~financial~~("Exchange ~~statements~~Act"), the Company's Chief Executive Officer and Chief Financial Officer evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined under Rule 13a-15(e) under the Exchange Act) as of the end of the period covered by this report.

~~F-2~~Based upon that evaluation, they concluded that the Company’s disclosure controls and procedures were effective as of December 31, 2014 to ensure that information required to be disclosed by the Company in the reports that the Company files or submits under the Exchange Act, is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms, and that such information is accumulated and communicated properly to allow timely decisions regarding required disclosure.

~~AVWORKS~~A ~~AVIATION~~material ~~CORP~~weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company's annual or interim financial statements will not be prevented or detected on a timely basis.

~~STATEMENT~~The OFCompany ~~OPERATIONS~~believes there are no material weaknesses in internal controls and procedures parting that the Company believes it has sufficient personnel with expertise in the area of SEC, generally accepted accounting principles (GAAP) and tax accounting procedures.

	For the Years Ended
	December 31,
	2012			2011
NET REVENUES	$	58,056		$	209,433
COST OF REVENUES		35,596			116,823
GROSS PROFIT		22,460			92,610
COST AND EXPENSES
Depreciation		2,000			2,000
Selling and marketing expenses		10,018			11,368
General and administrative expenses		156,848			138,358
		168,866			151,726
(Loss) from continuing operations		(146,406	)		(59,116	)
Casualty loss		78,838			-
Interest expense		10,469			3,466
Total other income and (expense)		(89,307	)		(3,466	)
Net (Loss)	$	(235,713	)	$	(62,582	)
Earnings (loss) per share
- Basic	$	(0.00	)	$	(0.00	)
Weighted average number of shares
outstanding		267,465,400			174,429,802

Management's Report on Internal Control Over Financial Reporting

Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. The ~~accompaying~~Company's ~~notes~~internal ~~are~~control anover ~~integral~~financial ~~part~~reporting is designed to provide reasonable assurance regarding the reliability of ~~these~~financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America ("GAAP"). The Company's internal control over financial reporting includes those policies and procedures that:

~~F-3~~· pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; · provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and · provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.

~~AVWORKS AVIATION CORP. STATEMENT OF CHANGES IN STOCKHOLDER'S DEFICIT FOR THE YEARS ENDED DECEMBER 31, 2012 AND 2011~~39

							Additional						Total
	Common Stock						Paid-in			Accumulated			Stockholders'
	Shares			Amount			Capital			Deficit			Equity (Deficit)
Balance at December 31, 2010		153,250,000			153,250			1,035,516			(1,207,888	)		(19,122	)
Common stock cancelled pursuant
to Share Exchange Agreement		(67,000,000	)		(67,000	)		67,000			-			-
Common stock issued pursuant
to Share Exchange Agreement		165,000,000			165,000			(165,000	)		-			-
Common stock issued for Offering		440,000			440			21,560			-			22,000
Common stock issued for services		10,000,000			10,000			-			-			10,000
Common stock issued for conversion on notes payable		620,000			620			30,380						31,000
Interest payment by stockholder		-						167			-			167
Net loss		-			-			-			(62,582	)		(62,582	)
Balance at December 31, 2011		262,310,000		$	262,310		$	989,623		$	(1,270,470	)	$	(18,537	)
Return to authorised #1605 and 1606		(10,000,000	)		-
Common stock issued for services		10,000,000			-
Common stock issued for conversion of note payable		7,710,145			7,710			16,343						24,053
Net (loss)		-			-			-			(235,713	)		(235,713	)
Balance at December 31, 2012		270,020,145		$	270,020		$	1,005,966		$	(1,506,183	)	$	(230,197	)

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

~~The~~In ~~accompaying~~connection ~~notes~~with ~~are~~the preparation of our annual financial statements, we have assessed the effectiveness of internal control over financial reporting as of December 31, 2014, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission, or the COSO Framework. Management’s assessment included an ~~integral~~evaluation ~~part~~of the design of ~~these~~our internal control over financial ~~statements~~reporting and testing of the operational effectiveness of those controls. Based on this evaluation, management has determined that as of December 31, 2014, our internal controls over financial reporting were effective and that there were no material weaknesses in our internal control over financial reporting.

~~F-4~~Changes in Internal Controls Over Financial Reporting

~~AVWORKS~~During ~~AVIATION~~the ~~CORP~~fourth ~~STATEMENT~~quarter OFended ~~CASH~~December ~~FLOWS~~31, 2014, there were no significant changes in internal controls of the Company, or other factors that could significantly affect these controls subsequent to the date of their evaluation.

	For the Years Ended
	December 31,
	2012			2011
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(235,713	)	$	(62,582	)
Adjustments to reconcile increase(decrease) in net assets to cash
provided by operating activities:
Common stock issued for services		-			10,000
Common stock issued for notes payable conversion		-			31,000
Interest paid by shareholder		20,138			167
Depreciation		2,000			2,000
Changes in operating assets and liabilities:
Decrease/(Increase) in inventory		45,100			(16,445	)
Dcrease/(Increase) in accounts receivable		19,030			(45,100	)
Decrease/ (Increase) in other assets		3,653			(2,222	)
Increase in accounts payables		42,623			28,011
Increase in note payable		74,593			329
NET CASH USED IN OPERATING ACTIVITIES		(28,576	)		(54,842	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Net cash provided by investing activities		-			-
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash Overdraft		400			-
Contribution by member		-			100
Officer advance receivable decrease		-			4,782
Notes payable converted to common stock		16,070			(31,000	)
Proceeds from sale of common stock		7,983			22,000
Proceeds from loans payable		-			56,000
Net cash used in provided by financing activities		24,453			51,882
NET DECREASE IN CASH AND CASH EQUIVALENTS		(4,123	)		(2,960	)
CASH - BEGINNING OF YEAR		4,123			7,083
CASH - END OF YEAR	$	(0	)	$	4,123
Supplemental disclosure of cash flow information
Cash paid for income taxes	$	-		$	-
Cash paid for interest	$	-		$	-
Non-Cash Financing Activities
Stock issued for payment of debt	$	16,070		$	-

ITEM 9B. OTHER INFORMATION.

~~The accompanying notes are an integral part of these financial statements~~None.

~~F-5~~40

~~AVWORKS~~PART ~~AVIATION CORP.~~III

~~NOTES~~ITEM TO10. ~~FINANCIAL~~DIRECTORS, ~~STATEMENTS~~EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE.

ASDirectors, OFExecutive ~~DECEMBER 31~~Officers, ~~2012~~Promoter and Control Persons

~~Note~~The ~~1 –~~below ~~Nature~~table lists all current officers and ~~Description~~directors of ~~Business~~the Company as of the date of the filing of this Report. All officers serve at the discretion of the Board of Directors. The term of office of each of our directors expire at our next Annual Meeting of Shareholders or until their successors are duly elected and qualified.

We had been originally incorporated under the laws of Canada on January 15, 1990, under the name "Creemore Star Printing, Inc." We changed our name on June 15, 2003 to "Smitten Press: Local Lore and Legends, Inc." We domesticated in the State of Nevada by filing Articles of Incorporation in Nevada on May 8, 2007, and we were incorporated in the State of Nevada on May 8, 2007, as Smitten Press: Local Lore and Legends, Inc. On April 30, 2010, our Board of Directors approved a change in our name to DataMill Media Corp., effective at the close of business on June 30, 2010. In June 2011, we completed our initial public offering of 5,000,000 shares of Common Stock and received $100,000 in proceeds from the offering.

NAME	AGE	POSITION
Dror Svorai	46	President, CEO, Treasurer, Director
Yaniv Nahon	33	Vice President, Secretary, COO, Director
Jorge Schcolnik	70	Vice President, CFO, Director

WeThe ~~were a management consulting firm that planned to educate and assist small businesses to improve their management, corporate governance, regulatory compliance and other~~ business ~~processes,~~background ~~with~~descriptions ~~a focus on capital market participation. However, after we completed our initial public offering, we explored a couple~~ of ~~opportunities~~the tonewly ~~acquire~~appointed ~~operating~~director companies in order to enhance shareholder value. On September 2, 2011, we entered into a Share Exchange Agreement with Young Aviation, LLC. On September 19, 2011, we amended our Articles of Incorporation to (i) increase our authorized capital stock to 500,000,000 shares of Common Stock and ~~(ii)~~officer ~~effect~~are aas 10 shares for one share forward stock split. On October 3, 2011, we closed the Share Exchange Agreement, which resulted in Young Aviation, LLC becoming a wholly-owned subsidiary. On November 10, 2011, a majority of our shareholders approved a change in our name to AvWorks Aviation Corp., effective November 30, 2011, to reflect our new business focus.follows:

~~Young~~Dror ~~Aviation,~~Svorai. ~~founded~~Mr. ~~in 2004~~Svorai, isPresident ~~currently~~and aChief ~~diversified~~Executive ~~broker~~Officer and ~~supplier~~Treasurer of ~~parts~~the Vapor Group, ~~components~~Inc. ~~and~~is ~~products~~a tofounder in 2012 of the ~~general~~Vapor ~~aviation~~Group, Inc., and ~~aerospace~~its ~~markets~~subsidiaries, ofTotal ~~the~~Vapor UInc.S., ~~Europe~~Vapor 123, Inc. and ~~Asia~~Vapor Products, Inc. ~~"General~~For ~~aviation"~~the ispast ~~defined~~two asyears ~~all~~he ~~aviation~~has ~~other~~overseen ~~than~~the ~~military~~day-to-to operations of these companies and ~~scheduled~~managed ~~commercial~~their ~~airlines~~steady growth. ~~Over~~In ~~20%~~the often ~~our~~years ~~sales~~prior ~~revenue~~to 2012, Mr. Svorai has ~~been~~served ~~derived~~in ~~from~~executive ~~international~~positions, ~~sales~~including ~~for~~president ~~the~~and ~~period~~chief ~~from~~executive ~~January~~officer 1of several companies, ~~2009~~and tohas ~~date~~maintained an ongoing involvement in several private real estate ventures.

~~Young~~Before ~~Aviation~~then, ~~services~~Mr. aSvorai ~~broad~~also ~~range~~was involved in investments of ~~clients~~real ~~such~~estate, asand ~~aircraft~~was ~~leasing~~a ~~companies,~~business ~~major~~owner ~~airlines,~~in ~~repair~~the ~~stations~~garment industry and the private jet industry. From 1997 until 2001, ~~fixed-base~~Mr. ~~operators~~Svorai was the founder and chief executive officer of Ocean Drive of Orlando. From 1998 until 2003, ~~leasing~~Mr. ~~companies~~Svorai was the founder and ~~after~~chief ~~market~~executive ~~suppliers~~officer of Ocean Drive Fashion. From 2003 until 2006 Mr. Svorai was the founder and chief executive officer of the D & D Fashion Group Inc.

AsYaniv aNahon. ~~result~~Mr. ofNahon established the ~~Share~~first ~~Exchange~~e-cigarette ~~Agreement~~retail business in Southwest Florida in 2008. Since 2008, he has remained focused on the ~~Company~~development ~~acquired~~and ~~Young~~marketing ~~Aviation~~of e-cigarettes at both the wholesale and ~~Joel~~retail Alevels, owning an operating his own retail businesses. ~~Young~~In ~~became~~2012 ~~the~~he joined Vapor Group as Vice President, and Chief ~~Executive~~Operating Officer having overall responsibility for product development, quality control and ~~sole~~the ~~Director~~supply ofchain. Mr. Nahon is also the ~~Company~~corporate onSecretary ~~October~~of 3,the ~~2011,~~Vapor ~~when~~Group ~~our~~and ~~prior~~a ~~management~~member ~~officials~~of ~~resigned~~its Board of Directors.

~~The~~Jorge ~~Company~~Schcolnik. ~~accounted~~In ~~for~~September ~~the~~2013, ~~share~~Mr. ~~exchange~~Schcolnik ~~transaction~~became asVice President, Chief Financial Officer and a ~~recapitalization~~member of ~~Young~~Board ~~Aviation,~~of ~~LLC,~~Directors asof the ~~members~~Vapor Group. During the past five years, Mr. Schcolnik has been involved in several large international companies. Mr. Schcolnik was one of the ~~LLC~~founders ~~obtained~~of Integral Bioenergies Systems SL, a ~~majority~~company ~~interest~~located in Spain, where he was involved in its restructure and ~~management~~ultimate ~~control~~sale ofin 2008. Mr. Schcolnik was associated with E-Libro Corp. for which he deployed the ~~Company~~digital publishing market in Argentina. AsHe awas ~~recapitalization~~also associated with the Federal and City of ~~Young~~Buenos ~~Aviation~~Aires Government for the company's academic platform. Since 2010, ~~LLC~~Mr. Schcolnik has been an officer in Advanced Envirotec Corp., itAdvanced isCopisa ~~considered~~Environmental ~~the~~Corp. ~~accounting~~and ~~acquirer~~other environmental remediation companies.

~~The~~Since ~~Company~~1995, isMr. ~~carrying~~Jorge onSchcolnik has also been representing the ~~business~~State of ~~Young~~Buenos ~~Aviation~~Aires, ~~LLC~~Argentina, aswithin ~~its~~the ~~sole~~United ~~line~~States in a number of ~~business~~capacities Commencing 1999, Mr. ~~Young~~Schcolnik ~~Aviation~~acted isas athe ~~diversified~~chief ~~broker~~advisor to the Small and ~~supplier~~Medium Sized Enterprises Secretariat of ~~parts,~~the ~~products~~Republic ~~and~~of ~~services~~Argentina tobased in the ~~worldwide~~United ~~aviation,~~States. ~~aerospace~~Mr. Schcolnik held that position until 2001. During 2001, ~~government~~Mr. ~~and~~Schcolnik ~~defense~~participated ~~markets~~as a co-founder of Enterprise Buenos Aires Corp., ~~Young~~which ~~Aviation~~was ~~services~~later transformed into EBA PLC Corp., a ~~broad~~company ~~range~~dedicated to the development of ~~clients~~power-line ~~such~~communications. EBA PLC Corp. became a prominent company within the power line communications industry as ~~aircraft~~after ~~leasing~~two ~~companies,~~years ~~major~~it ~~airlines,~~was ~~repair~~sold ~~stations,~~in ~~fixed-base~~a ~~operators~~transaction involving several million US Dollars. Mr. Schcolnik was born in Buenos Aires, ~~leasing~~Argentina, ~~companies~~in 1945 and ~~after~~moved ~~market~~to ~~suppliers~~the United States in September 1995.

~~F-6~~Currently, Mr. Svorai, Mr. Nahon and Mr. Schcolnik are the Company’s sole officers and directors.

~~Note~~There ~~2 –~~are ~~Going~~no ~~Concern~~arrangements or understandings between our officers and directors and any other person pursuant to which any director or officer was or is to be selected as a director or officer, and there are no arrangements, plans or understandings as to whether non-management shareholders will exercise their voting rights to continue to elect the current board of directors. There are also no arrangements, agreements or understandings to our knowledge between non-management shareholders that may directly or indirectly participate in or influence the management of our affairs.

AsFamily reflected in the accompanying consolidated financial statements, the Company had a net loss and net cash used in operations of $235,713 and $28,576, respectively, for the year ended December 31, 2012. In addition, the Company had a working capital deficit of $233,197 at December 31, 2012. These matters raise substantial doubt about the Company's ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company's ability to raise additional capital, further implement its business plan and to generate additional revenues.Relationships

~~Management believes that the actions presently being taken provide the opportunity for the Company to continue as a going concern~~None. ~~The consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.~~

~~Note~~Other ~~3 – Summary of Significant Accounting Policies~~Directorships

~~This~~Other ~~summary~~than ofas ~~significant~~indicated ~~accounting~~within ~~policies~~this issection ~~provided~~none toof ~~assist~~ the ~~reader in understanding the~~ Company's ~~financial~~directors ~~statements.~~hold ~~The~~or ~~financial~~have ~~statements~~been ~~and~~nominated ~~notes~~to ~~thereto~~hold ~~are~~a ~~representations~~directorship ofin ~~the~~any ~~Company's~~company ~~management.~~with ~~The~~a ~~Company's~~class ~~management~~of issecurities ~~responsible~~registered ~~for~~pursuant ~~their~~to ~~integrity~~Section ~~and~~12 ~~objectivity.~~of ~~These~~the ~~accounting~~Exchange ~~policies~~Act ~~conform~~(the "Act") or subject to ~~accounting~~the ~~principles~~requirements ~~generally~~of ~~accepted~~Section in15(d) of the ~~United~~Securities ~~States~~Act of ~~America~~1933 ~~and~~or ~~have~~any ~~been~~or ~~consistently~~any ~~applied~~company inregistered ~~the~~as ~~preparation~~an ofinvestment company under the ~~financial~~Investment ~~statements~~Company Act of 1940.

Basis of Presentation - The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for complete financial statements.42

~~Use~~Involvement ~~of estimates -~~ In ~~preparing~~Certain ~~financial~~Legal statements, management is required to make estimates and assumptions that effect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and revenues and expenses during the periods presented. Actual results may differ from these estimates.Proceedings

~~Significant~~During ~~estimates~~the inpast five years, the ~~periods~~Company's ~~included~~officers and directors have not been involved in any of the ~~accompanying~~following: ~~consolidated~~(1) ~~financial~~any ~~statements~~bankruptcy ~~include~~petition anfiled ~~estimate~~by or against any business of which such person was a general partner or executive officer either at the ~~deferred~~time ~~tax~~of ~~asset~~the ~~valuation~~bankruptcy ~~allowance~~or within two years prior to that time; (2) any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses); (3) being subject to any order, ~~valuation~~judgment, or decree, not subsequently reversed, suspended or vacated, of ~~shares~~any ~~issued~~court ~~for~~of ~~services~~competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; and ~~valuation~~(4) being found by a court of ~~contributed~~competent ~~services~~jurisdiction (in a civil action), the Commission or the Commodities Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacated.

~~Principles~~Committees of ~~Consolidation - The consolidated financial statements include~~ the accounts of AvWorks Aviation Corp. as of the date the Share Exchange Agreement closed, October 3, 2011, and its wholly-owned subsidiary, Young Aviation, LLC. All material intercompany balances and transactions have been eliminated in consolidation. All financial and related data has been retroactively adjusted in the accompanying consolidated financial statements and footnotes to reflect the effect of the recapitalization of AvWorks Aviation Corp and the presentation of consolidated historical financial data.Board

The acquisition of Young Aviation, considered a reverse merger, resulted in a change in control at the Company and new management decided to abandon our former business of management consulting and focus solely on the business of Young Aviation. The Company accounted for the share exchange transaction as a recapitalization of Young Aviation, LLC.None

~~F-7~~Board Meetings and Committees; Annual Meeting Attendance

~~Property~~During ~~and~~2014, ~~equipment~~the isCompany asdid ~~follows~~not asconduct ofany ~~December~~formal ~~31,~~Board ~~2012~~meetings and ~~2011:~~conducted business through Written Actions.

	2012		2011
Furniture and fixtures	$	147	$	147
Office equipment		165		165
Computer software		2,675		2,675
Motor vehicle		10,000		10,000
		12,987		12,987
Accumulated depreciation		9,987		7,987
Net property and equipment	$	3,000	$	5,000

Indemnification

~~Depreciation~~The ~~expense~~General ~~for~~Corporation ~~the~~Law ~~year~~of ~~ended~~Florida ~~December~~provides 31that directors, ~~2012~~officers, ~~and~~employees ~~December~~or 31agents of Florida corporations are entitled, ~~2011~~under ~~was~~certain $2circumstances,~~000.~~ ~~The~~to ~~use~~be ofindemnified ~~our~~against ~~property~~expenses (including attorneys' fees) and ~~equipment~~other ~~determines~~liabilities ifactually ~~the~~and ~~depreciation~~reasonably isincurred ~~recorded~~by them in connection with any suit brought against them in their capacity as ~~cost~~a director, officer, employee or agent, if they acted in good faith and in a manner they reasonably believed to be in or not opposed to the best interests of ~~goods~~the ~~sold~~corporation, and with respect to any criminal action or asproceeding, ~~general~~if they had no reasonable cause to believe their conduct was unlawful. This statute provides that directors, officers, employees and ~~administrative~~agents may also be indemnified against expenses (including attorneys' fees) actually and reasonably incurred by them in connection with a derivative suit brought against them in their capacity as a director, if they acted in good faith and in a manner they reasonably believed to be in or not opposed to the best interests of the corporation, except that no indemnification may be made without court approval if such person was adjudged liable to the corporation.

~~Notes 4 – Notes Payable~~43

~~The~~Our ~~Company~~Certificate ~~had~~of ~~notes~~Incorporation ~~payable~~provides ~~totaling~~that ~~$150,593~~we ~~and~~shall ~~$76,000~~indemnify atany ~~December~~and 31all ~~2012and~~persons ~~2011~~whom ~~respectively.~~we Onshall ~~August~~have ~~15,~~power ~~2011,~~to anindemnify ~~individual~~to ~~loaned~~ the ~~Company~~fullest ~~$20,000~~extent inpermitted ~~exchange~~by ~~for~~the aFlorida ~~Promissory~~Corporate ~~Note bearing interest at 5% for a term of six months~~Law. InArticle ~~lieu~~VII of ~~paying~~our ~~interest~~By-Laws onprovides ~~the~~that ~~note,~~we ~~restricted~~shall ~~shares~~indemnify ofour ~~the~~authorized ~~Company's~~representatives ~~common stock was issued~~ to the ~~note-holder.~~fullest ~~The~~extent ~~Note~~permitted ~~was~~by ~~paid~~the inFlorida ~~full in April 2012~~Law. OnOur ~~November~~By-Laws ~~22,~~also ~~2011,~~permit anus ~~individual~~to ~~loaned~~purchase ~~the~~insurance ~~Company~~on ~~$6,000~~behalf inof ~~exchange~~any ~~for~~such aperson ~~Promissory~~against ~~Note~~any ~~bearing~~liability ~~interest~~asserted atagainst ~~10%~~such ~~for~~person aand ~~term~~incurred ofby ~~six~~such ~~months.~~person Onin ~~December~~any 5capacity, ~~2011,~~or anout ~~individual~~of ~~loaned~~such ~~the~~person's ~~Company~~status ~~$50,000~~as ~~in exchange for a Promissory Note bearing interest at 12% for a term of one month~~such, ~~renewable~~whether ~~each~~or ~~month~~not ifwe ~~agreed~~would ~~upon~~have by the ~~parties.~~power ~~To date, the parties have agreed~~ to ~~renew~~indemnify ~~and~~such ~~extend~~person ~~the~~against ~~note~~such ~~each~~liability ~~month.~~under ~~The accrued interest payable balance on this note was $6,433 at December 31, 2012 and is included in~~ the ~~Accrued~~foregoing ~~Expense~~provision ~~section~~ of the ~~Company's balance sheet~~by-laws.

OnThe ~~February~~foregoing 2,discussion ~~2012, an entity loaned the Company $42,500 in exchange for a Promissory Note bearing interest at 8% for a term~~ of ~~nine~~indemnification ~~months,~~merely ~~convertible~~summarizes ~~after~~certain ~~nine~~aspects ~~months at 50%~~ of ~~the~~indemnification ~~market~~provisions ~~price~~and ofis ~~our~~limited ~~shares.~~by Inreference ~~May 2012, the Company repaid 28,000 of this note together with accrued interest thereon. As a result, the balance of the note amounted~~ to ~~$15,384 and~~ the ~~accrued~~above ~~interest~~discussed ~~was~~sections ~~$813 and is included in the Accrued Expense section~~ of the ~~Company's~~Florida ~~balance~~Corporation ~~sheet~~Law.

OnThe ~~April~~Company's ~~18,~~Articles ~~2012,~~of ~~the~~Incorporation ~~Company~~and ~~borrowed~~Bylaws ~~funds~~provide ~~from~~that ~~Asher~~the ~~Enterprises~~Company inmay indemnify to the ~~amount~~full extent of ~~$30~~its power to do so,~~000~~ ~~bearing~~all ~~interest~~directors, atofficers, employees, and/or agents. Insofar as indemnification by the ~~rate~~Company offor ~~12%~~liabilities ~~per~~arising ~~year.~~under ~~The~~the ~~accrued~~Securities ~~interest~~Act onmay ~~this~~be ~~note~~permitted isto ~~$1,690~~officers atand ~~December~~directors 31of the Company pursuant to the foregoing provisions or otherwise, ~~2012~~the ~~and~~Company is ~~included~~aware that in the ~~Accrued~~opinion ~~Expense~~of ~~section~~the ofCommission, such indemnification is against public policy as expressed in the ~~Company’s~~Securities ~~balance~~Act ~~sheet~~and is, therefore, unenforceable.

~~F-8~~ITEM 11. EXECUTIVE COMPENSATION.

~~From~~Summary ~~May~~Compensation through October 2012, the Company’s director converted accrued expense and / or loaned the Company a total of $40,332. The accrued interest on this note as of December 31, 2012 is $1,981 and is included in the Accrued Expense section of the Company’s balance sheet.Table

OnThe ~~June~~following 1,table ~~2012,~~lists the compensation of the Company's ~~borrowed~~principal ~~$8,877~~executive ~~from~~officers ~~Sunny~~for ~~Boyd~~the ~~Williams~~years ~~LLC~~ended December 31, 2014 and 2013. The ~~accrued~~following ~~interest~~information onincludes ~~this~~the ~~note~~dollar asvalue of ~~December~~base 31salaries, ~~2012~~bonus isawards, ~~$621~~the ~~and~~number isof ~~included~~non-qualified inCompany ~~the~~Options ~~Accrued~~granted ~~Expense~~and ~~section~~certain ofother ~~the~~compensation, ~~Company’s~~if ~~balance~~any, ~~sheet~~whether paid or deferred.

All of the above notes are now due on demand and are uncollateralized.

Name and all other Principal Position Compensation ($)	Total ($)		Year	Salary ($)		Bonus ($)		Stock Awards ($)

Dror Svorai, CEO	$	0	2014	$	0	$	0	$	0
Yaniv Nahon, COO	$	0	2014	$	0	$	0	$	0
Jorge Schcolnik, CFO	$	0	2014	$	0	$	0	$	0
Joe Eccles, President, CEO	$	0	2013	$	0	$	0	$	0
Michael Zoyes, President, CEO	$	0	2013	$	0	$	0	$	0
Joel A Young, President, CEO	$	0	2013	$	0	$	0	$	0

AsWe ado ~~result~~not ofhave ~~the~~any ~~above,~~employment ~~the~~agreements ~~balance~~with atany ~~December 31, 2012,~~ of ~~the~~our ~~notes payable is $150,593 and the accrued interest thereon is $12,204~~officers.

~~Other~~The ~~Current~~compensation ~~Liabilities~~discussed -herein ~~The~~addresses ~~Company~~all ~~had~~compensation ~~other~~awarded ~~current~~to, ~~liabilities~~earned ~~consisting of~~by, ~~the~~or ~~following~~paid atto ~~December~~our ~~31,~~named executive officer.

	2012		2011
Accrued Payroll	$	70,000	$	35,279
Accrued interest payable		12,204		4,302
Total Accrued expense	$	82,204	$	39,581

~~Preferred~~STOCK ~~stock~~OPTION AND OTHER COMPENSATION PLANS

The Company iscurrently ~~authorized~~does tonot ~~issue~~have ~~10,000,000~~a ~~shares~~stock ofoption ~~preferred~~or ~~stock~~any atother acompensation ~~par~~plan ~~value~~for ~~$0.001.~~its Noexecutive ~~shares~~officers ~~were~~or ~~issued~~directors asand ofhas ~~December~~never ~~31,~~had ~~2012~~such ~~and~~a ~~2011,~~plan ~~respectively~~in the past.

~~Common~~COMMITTEES ~~stock~~OF THE BOARD OF DIRECTORS

~~The~~We ~~Company~~do isnot ~~authorized~~currently tohave ~~issue~~an upaudit tocommittee ~~500,000,000~~or ~~shares of common stock with~~ a ~~par~~compensation ~~value of $0~~committee.~~001, under terms and conditions established by the Board of Directors.~~

~~The~~COMPENSATION ~~Company~~OF ~~had 270,020,145 and 262,310,000 issued and outstanding common stock shares as of December 31, 2012 and December 31, 2011, respectively.~~DIRECTORS

~~Prior~~Our todirectors ~~the~~do ~~closing~~not ofreceive ~~the~~any ~~Share~~direct ~~Exchange~~compensation ~~Agreement,~~for ~~AvWorks~~their ~~Aviation~~service ~~Corp.~~on ~~(f/k/a~~our ~~Datamill~~board ~~Media Corp.) had 153,250,000 shares~~ of ~~common stock outstanding on a post forward split basis~~directors. AsAny afuture ~~condition~~director tocompensation ~~the~~will ~~closing~~be ofdetermined ~~the~~by ~~Share~~our ~~Exchange~~compensation ~~Agreement~~committee, ~~Vincent~~once ~~Beatty,~~it ~~Datamill's~~is ~~President, on October 3, 2011, surrendered 67,000,000 (post forward split) shares of common stock held by Mr~~chartered. ~~Beatty for cancellation and such shares were cancelled by their transfer agent.~~

~~F-9~~COMPENSATION DISCUSSION AND ANALYSIS

OnThere ~~October~~is 3,currently ~~2011,~~no ~~Datamill~~compensation ~~acquired~~policy ~~100% of Young Aviation's member's interests, pursuant to the Share Exchange Agreement~~ in ~~exchange~~place for ~~the~~officers ~~issuance~~or bydirectors ~~Datamill~~ of ~~165,167,165 shares of restricted common stock shares and~~ the ~~issuance by Datamill of 620,000 shares of restricted common stock shares for the conversion of notes payable~~Company. Following the closing of the Share Exchange Agreement, Datamill had 252,037,165 shares of common stock issued and outstanding. Young Aviation became a wholly-owned subsidiary of Datamill. The Shares were issued to ten individuals with the majority share (165,000,000 shares) issued to Joel A. Young, who is now the President and Chief Executive Officer and our sole Director of the surviving entity

OnITEM ~~October~~12. 5,SECURITY ~~2011,~~OWNERSHIP ~~the~~OF ~~Company~~CERTAIN ~~issued~~BENEFICIAL anOWNERS ~~aggregate~~AND of 10,000,000 restricted common stock shares pursuant to one year agreements with two individuals in exchange for consulting and advisory services in relation to the Company's accounting and compliance requirements and the provision of federal securities advice to the Company and the preparation of required filings.MANAGEMENT

InThe ~~addition~~following table sets forth, onas ~~October~~of 5March 30, ~~2011~~2015, the ~~Company~~number ~~approved~~ and ~~adopted~~percentage ~~the~~of ~~Corporation's~~shares ~~2011~~of ~~Employee~~Preferred Stock and ~~Consultant~~Common Stock ~~Incentive~~of ~~Plan~~the ~~("Plan")~~Company, owned of record and ~~reserved~~beneficially, 12by each person known by the Company to own 5% or more of such stock,~~000,000~~ ~~shares~~each director of ~~its~~the ~~common~~Company, ~~stock~~and ~~for~~by ~~issuance~~all ~~under~~executive officers and directors of the ~~Plan.~~Company, as a group:

Note 6 – Legal Matters

Name and Address	Class	Number of Shares(1)	Percentage
Dror Svorai (3)	Series A Preferred	1,000,000	100.00%
Dror Svorai (3)	Series B Preferred	262,500 (2)	75.00%
Yaniv Nahon (4)	Series B Preferred	87,500 (2)	25.00%
Dror Svorai (3)	Common	17,784,793	<1%
Jorge Schcolnik (5)	Common	1,000,000	<1%

All officers and directors as a group (3 persons)	Series A Preferred	1,000,000	100.00%
Dror Svorai (3) and Yaniv Nahon (4)	Series B Preferred	350,000 (2)	100.00%
Dror Svorai (3) and Jorge Schcolnik	Common	18,784,793	<1%

~~The Company is not aware of any pending or threatened legal matters that would have a material impact on our financial condition.~~45

F(1) The numbers and percentages set forth in these columns are based on 2,658,813,601 shares of Common Stock outstanding as of March 30, 2015. The number and percentage of units beneficially owned is determined in accordance with Rule 13d-103 of the Securities Exchange Act of 1934, and the information is not necessarily indicative of beneficial ownership for any other purpose. Under such rule, beneficial ownership includes any equity securities as to which the holder has sole voting power or investment power and also any shares that the holder has the right to acquire within 60 days.

(2) The quantities of Series B Preferred Stock set forth in these columns is based on an allocation of the total of 350,000 shares of Series B Preferred Stock to be issued per the terms and conditions of the Merger Agreement, as amended, per the Form 8-K dated March 7, 2014, filed by the Company on March 11, 2014, and the Acquisition Agreement, dated December 31, 2014 by and between the Company and VGR Media, Inc. per the 8-K dated December 31, 2014, and filed by the Company on January 5, 2014.

(3) Mr. Svorai's address is 3901 SW 47^thAvenue, Suite 415, Davie, Florida 33314.

(4) Mr. Nahon's address is 3901 SW 47^thAvenue, Suite 415, Davie, Florida 33314.

(5) Mr. Schcolnik's address is 3901 SW 47^thAvenue, Suite 415, Davie, Florida 33314.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Exchange Act requires directors and certain officers of the Company, as well as persons who own more than 10% of a registered class of the Company’s equity securities ("Reporting Persons"), to file reports with the Commission. The Company believes that during fiscal 2014, all Reporting Persons timely complied with all filing requirements applicable to them.

Except for the transactions described below, none of our directors, officers or principal shareholders, or any associate or affiliate of the foregoing, have any interest, direct or indirect, in any transaction or in any proposed transaction, which materially affected us during the year ended December 31, 2014.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

As incurred by Vapor Group, Inc.

Audit and Accounting Fees. By a letter of agreement with the Company dated January 25, 2015, Terry L. Johnson, CPA, (“Johnson”), will invoice the Company $7,500-10,000 for professional services plus out-of-pocket expenses, rendered for the annual audit for the year ended December 31, 2014. In 2014, Johnson invoiced the Company a total of $4,500 for the three quarterly reviews of the Company's financial statements for 2014, and $14,500 for professional services rendered for the annual audit for the year ended December 31, 2013, December 31, 2012 and December 31, 2011, and each of their respective quarterly reviews of the Company's financial statements for 2013 and 2012, including other services that are normally provided by an accountant in connection with statutory and regulatory filings or engagements for the fiscal year.

Tax Fees: No amounts have been billed to the Company for the preparation of tax returns for the fiscal years ended December 31, 2014.

All Other Fees. We incurred no other fees for the years ended December 31, 2014 and 2013.

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES.

Exhibits

Exhibit No.		Description

(a)		Financial statements for Vapor Group, Inc. listed in the Index on page F-1 are filed as part of this Annual Report.

31.1 and 31.2		Certification of Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14.*

32.1 and 32.2		Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*

_________

* Filed Herewith

SIGNATURES

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

	Vapor Group, Inc.

Date: March 30, 2015	By:	/s/ Dror Svorai
		Dror Svorai President and Treasurer

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To The Board of Directors and shareholders of

Vapor Group, Inc.

Sunrise, Florida

I have audited the accompanying consolidated balance sheets of Vapor Group, Inc. and its subsidiaries (the “Company”) as of December 31, 2014 and 2013 and the related statements of operations, stockholders’ deficit and cash flows for the years ended December 31, 2014 and 2013, and the related notes to the financial statements.

Management’s Responsibility for Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United State of America; this includes the design, implementation and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

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

Opinion

In my opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2014 and 2013 and the consolidated results of its operations and its cash flows for the years ended December 31, 2014 and 2013, in conformity with accounting principles generally accepted in the United States of America.

Emphasis of Matter

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As described in Note 2 of the accompanying consolidated financial statements, the Company has minimal revenues, has incurred losses since inception, and has a negative working capital balance at December 31, 2014, which raises substantial doubt about its ability to continue as a going concern. Management’s plans in regard to this matter are described in Note 2. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/s/ Terry L. Johnson, CPA

Casselberry, Florida

March 29, 2015

F-1

VAPOR GROUP, INC.

CONSOLIDATED BALANCE SHEET

	As of December 31,
	2014			2013
ASSETS
CURRENT ASSETS
Cash	$	413,230		$	48,177
Accounts receivable		257,991			104,856
Loan to shareholder		-			282,872
Inventory		1,006,679			149,732
Other current assets		1,423,133			358,483
Total current assets		3,101,033			944,120
PROPERTY AND EQUIPMENT, NET		75,569			16,054
OTHER ASSETS
Intangible assets, net		15,000			975
Deferred expenses		79			87,896
Total other assets		15,079			88,871
TOTAL ASSETS	$	3,191,681		$	1,049,045

LIABILITIES AND STOCKHOLDERS' DEFICIT

CURRENT LIABILITIES
Accounts payable	$	63,829		$	-
Accrued interest		245,751			88,375
Convertible notes payable		3,153,792			319,527
Loans payable		2,666			437,910
Payroll taxes payable		76,819			-
Sales tax payable		10,393			9,197
TOTAL CURRENT LIABILITIES		3,553,250			855,009
TOTAL LIABILITIES		3,553,250			855,009

STOCKHOLDERS' DEFICIT
Preferred stock, $0.0001 par value, 10,000,000 shares authorized, none issued and outstanding		-			-
Common stock, $0.0001 par value, 2,500,000,000 shares authorized, 50,451,000 and 100,000 issued and outstanding at December 31, 2014 and 2013 respectively,		927,967			50,451
Additional paid in capital		(808,148	)
Retained earnings(accumulated deficit)		(481,388	)		373,891
TOTAL STOCKHOLDERS' DEFICIT		(361,569	)		424,342
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$	3,191,681		$	1,279,351

The accompaying notes are an integral part of these financial statements.

F-2

VAPOR GROUP, INC.

CONSOLIDATED STATEMENT OF OPERATIONS

	For the Years Ended
	December 31,
	2014			2013

NET REVENUES	$	4,481,839		$	1,991,023

COST OF REVENUES		1,423,422			866,750

GROSS PROFIT		3,058,417			1,124,273

COST AND EXPENSES
Advertising and promotion		740,449			67,947
Commissions		491,700			45,054
Officers Compensation		-			150,000
Professional fees		303,717			95,778
General and administrative expenses		2,262,920			497,880

		3,798,786			856,659

(Loss) from continuing operations		(740,369	)		267,614

OTHER INCOME(EXPENSE)
Interest expense		(64,459	)		(105,894	)

Total other income and (expense)		(64,459	)		(105,894	)
Net (Loss)	$	(804,828	)	$	161,720

Earnings (loss) per share - Basic	$	-		$	-

Weighted average number of shares outstanding					50,451

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

F-3

VAPOR GROUP, INC.

CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDER'S DEFICIT

FOR THE YEARS ENDED DECEMBER 31, 2014 AND 2013

											Additional						Total
	Preferred Stock				Common Stock						Paid-in			Accumulated			Stockholders'
	Shares		Amount		Shares			Amount			Capital			Deficit			Deficit

Balance at December 31, 2012		-	$	-		100,000		$	100		$	-		$	161,720		$	161,820

Common stock issued for services						50,351,000			50,351									50,351

Net loss															161,720			161,720

Balance at December 31, 2013		-		-		50,451,000			50,451			-			323,440			373,891

Common stock issued for Debt conversion						(41,276,150	)	$	(41,276	)		110,644						69,368

Shares cancelled						918,792,358			918,792			(918,792	)					-

Net loss															(804,828	)		(804,828	)

Balance at December 31, 2014		-	$	-		927,967,208		$	927,967		$	(808,148	)	$	(481,388	)	$	(361,569	)

The accompaying notes are an integral part of these financial statements.

F-4

VAPOR GROUP, INC.

CONSOLIDATED STATEMENT OF CASH FLOWS

	For the Years Ended
	December 31,
	2014			2013

CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(804,828	)	$	161,720
Adjustments to reconcile increase(decrease) in net assets to cash provided by operating activities:
Common stock issued for services		-			50,351
Depreciation		-			4,338
Changes in operating assets and liabilities:
Inventory		(856,947	)		40,654
Accounts receivable		(153,135	)		(104,856	)
Other assets		(671,134	)		(308,603	)
Accounts payables		63,829			(77,917	)
Payroll tax payable		76,819
Sales tax payable		1,196			9,197
Deferred expenses					(87,896	)
Accrued interest		157,376			76,445

NET CASH USED IN OPERATING ACTIVITIES		(2,186,824	)		(236,567	)

CASH FLOWS FROM INVESTING ACTIVITIES:

Payments for property and equipment		(59,515	)		(6,367	)

Net cash provided by investing activities		(59,515	)		(6,367	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Loan to shareholder		164,194			(248,626	)
Proceeds from sale of common stock		-			-
Proceeds from convertible notes		2,834,265			94,800
Payments on loans payable loans payable		(435,244	)		437,910
Net cash used in provided by financing activities		2,563,215			284,084
NET DECREASE IN CASH AND CASH EQUIVALENTS		316,876			41,150

CASH - BEGINNING OF YEAR		48,177			7,027

CASH - END OF YEAR	$	365,053		$	48,177
Supplemental disclosure of cash flow information
Cash paid for income taxes	$	-		$	-
Cash paid for interest	$	-		$	-
Non-Cash Financing Activities
Stock issued for payment of debt	$	-		$	-

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

F-5

VAPOR GROUP INC

NOTES TO FINANCIAL STATEMENTS

AS OF DECENBER 31, 2014

Note 1 – GENERAL INFORMATION

1.1. Incorporation, Nature and Description of Business

We were originally incorporated under the laws of Canada on January 15, 1990, under the name "Creemore Star Printing, Inc." and changed our name on June 15, 2003 to "Smitten Press: Local Lore and Legends, Inc." We domesticated to the State of Nevada on May 8, 2007, and we were incorporated as SmittenPress: Local Lore and Legends, Inc. On April 30, 2010, our Board of Directors approved a change in our name to DataMill Media Corp., effective at the close of business on June 30, 2010. On October 3, 2011, we closed a Share Exchange Agreement, which resulted in Young Aviation, LLC, (“Young Aviation”), becoming a wholly-owned subsidiary. On November 10, 2011, a majority of our shareholders approved a change in our name to AvWorks Aviation Corp. The acquisition of Young Aviation is classified as a reverse merger and resulted in a change in control at the Company and a new focus on the business of Young Aviation.

As the result of the slow growth of such operations, in early 2013 the Company decided to seek other business opportunities. On September 3, 2013, the majority shareholder of the Company and record holder of 165,000,000 shares of restricted common stock of the Company (61.11% of the 270,020,145 shares of common stock issued and outstanding), and Corporate Excellence Consulting, Inc., a Florida corporation, the holder of 1,000,000 shares of the Series A Preferred Stock of the Company (100% of the issued and outstanding shares of preferred stock of the Company), (collectively, the “Sellers), entered into a share purchase agreement (the “Share Purchase Agreement”) with Dror Svorai, an individual, (the “Buyer”), and the future President and CEO of the Company (post-Merger Agreement as hereinafter described). In accordance with the Share Purchase Agreement, the Sellers agreed to sell and transfer over time the 165,000,000 shares of restricted common stock and the 1,000,000 shares of Series A Preferred Stock of the Company to the Buyer for a total purchase price of $115,000. The Share Purchase Agreement provides that the purchase price be paid on or before February 13, 2014 and that as the purchase price is being paid by the Buyer, the shares of common and preferred stock are to be released pro-rata to the Buyer by the Sellers. The Share Purchase Agreement was completed and paid-in-full within its terms, and the sale and transfer of the common stock and Series A Preferred Stock to the Buyer was finalized on February 20, 2014. The sale and purchase of the 165,000,000 shares of common stock of the Company constitutes 49.34% of the total issued and outstanding shares of the Company of 343,536,386 as of April 11, 2014, and the sale and purchases of the 1,000,000 shares of Series A Preferred Stock constitutes 100% of the total issued and outstanding shares of preferred stock which has over 50% voting control of the Company. As a result, Dror Svorai, an individual, is the controlling shareholder of the Company.

On November 11, 2013, The Board of Directors and stockholders owning or having voting authority for 165,000,000 shares of issued and outstanding Common Stock of the then 270,020,145 shares issued and outstanding, or 61.11% of the voting common stock of the Company, and 1,000,000 shares of Series A Preferred Stock, representing all of the issued and outstanding shares of preferred stock of the Company, voted in favor of an amendment to our Articles of Incorporation to affect a reverse stock split of all of the outstanding shares of Common Stock, at a ratio of one-for-thirty. The reverse split which was pending and would have become effective once FINRA completes its review of the Company’s filings related to this corporate action, was subsequently cancelled by the Board of Directors on March 13, 2014, as filed on Form 8-K on March 18, 2014.

F-6

On January 22, 2014, the Company entered into an Agreement of Merger and Plan of Reorganization ("Merger Agreement") by and among the Company and the Vapor Group, Inc., a Florida corporation ("Vapor Group") and the shareholders of Vapor Group (the “Vapor Group Shareholders”), pursuant to which the Company will acquire 100% of the issued and outstanding shares of Vapor Group from the Vapor Group Shareholders in return for the issuance of 750,000,000 shares of its common stock. As a condition to be met prior to the closing of the Merger Agreement, the Company was required to increase its authorized shares of common stock to 2,000,000,000 from 500,000,000, which it did by filing an amendment to its Articles of Incorporation with the State of Florida on January 10, 2014, which amendment was accepted by the State of Florida on January 15, 2014 thereby increasing its authorized shares. The Merger Agreement subsequently became effective as of January 27, 2014 with its filing in the State of Florida.

As a result of the Merger Agreement:, Vapor Group assumed management control of the Company and established its business model and operations as the primary business operations of the Company. Prior management of the Company, Joe Eccles, resigned. Mr. Eccles did not resign as a result of any disagreement with the Company on any matter relating to the Company’s operations, policies or practices.

The “Agreement of Merger and Plan of Reorganization”, dated January 22, 2014, is considered a reverse merger, and resulted in another change in control at the Company and new management decided to abandon the former aviation business and focus solely on the business of Vapor Group.

About Vapor Group, Inc.

The principal business of Vapor Group, Inc., www.vaporgroup.com, (“Vapor Group”) is in the designing, developing, manufacturing and marketing high quality, vaporizers and e-cigarettes and accessories which use state-of-the-art electronic technology and specially formulated, “Made in the USA” e-liquids, which may or may not contain nicotine. Vapor Group offers a range of products and unique e-liquid flavors that it believes are unmatched in its industry. Its products are marketed under the Vapor Group, Total Vapor, Vapor 123, and Vapor Products brands, each of which is also a wholly-owned subsidiary of the same name. It sells nationwide through distributors, wholesalers and directly to consumers through its own websites and direct response advertising, and also owns as a wholly-owned subsidiary, Total Vapor Opportunities, Inc., a pending franchisor of “Total Vapor” retail stores in the continental U.S. In addition, Vapor Group owns as a wholly-owned subsidiary, VGR Media, Inc., www.vgr-media.com, a full service interactive advertising agency, offering Vapor Group’s products, and more generally customized performance marketing solutions to help marketers of consumer products acquire new customers and maximize their return on investment. VGR Media operates in the U.S. and sells domestically and internationally.

F-7

The following table shows individuals and legal entities with an equity interest greater than 20 percent and the amount of their equity interest:

Shareholder/owner	Class of Stock	Ownership Percentage

Dror Svorai	Preferred Series A Preferred Series B		100 75	% %

Yaniv Nahon	Preferred Series B		25	%
CEDE & Co.	Common		90	%

	Total		90	%

The Company's business activity is with customers located elsewhere in the United States through retailers and web-based sales as well.

1.2. Year-on-Year Changes and Amendments to the Florida Department of State – Division of Corporations

During calendar 2014, in addition to filing with the Department of State of Florida, a Notice of Merger on January 27, 2014, the Company filed six (6) amendments pertaining to Article IV of its Articles of Incorporation, all of which changed the number of shares of authorized common stock, and altered the preferences of the Series A and Series B Preferred Stock.

1.3. Organizational Structure

1.4. Board of Directors at the Balance Sheet Date:

	Position	Name
Board of Directors	Chairman & CEO	Dror Svorai
	Vice-Chairman & COO	Yaniv Nahon
	CFO	Jorge Schcolnik

F-8

Note 2 - GOING CONCERN

As reflected in the accompanying consolidated financial statements, the Company had a net loss of $804,828 as of December 31, 2014. In addition, the Company had a working capital deficit of $452,217 at December 31, 2014. These matters raise substantial doubt about the Company's ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company's ability to raise additional capital, further implement its business plan and to generate additional revenues.

Management believes that the actions presently being taken provide the opportunity for the Company to continue as a going concern. The consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

Note 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

This summary of significant accounting policies is provided to assist the reader in understanding the Company's financial statements. The financial statements and notes thereto are representations of the Company's management. The Company's management is responsible for their integrity and objectivity. These accounting policies conform to accounting principles generally accepted in the United States of America and have been consistently applied in the preparation of the financial statements.

Use of estimates - In preparing financial statements, management is required to make estimates and assumptions that effect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and revenues and expenses during the periods presented. Actual results may differ from these estimates.

The Company’s financial statements have been prepared as of the balance sheet date, December 31, 2014. The financial statements were prepared on January 31, 2015.

3.1. Tangible and Intangible Fixed Assets

Fixed assets include assets with an estimated useful life greater than one year and an acquisition cost greater than one thousand ($1,000) in respect of tangible assets, five thousands ($5,000) in respect of start-up costs, and one thousand ($1,000) in respect of other intangible assets, on an individual basis.

Purchased tangible and intangible fixed assets are stated at cost less accumulated depreciation and provisions, if any.

The cost of fixed asset improvements exceeding one thousand ($1,000) for individual tangible assets for the taxation period, and one thousand ($1,000) for individual intangible assets for the taxation period, increases the acquisition cost of the related fixed asset.

F-9

Depreciation is charged so as to write off the cost of tangible and intangible fixed assets, other than land and assets under construction, over their estimated useful lives, using the straight line method, on the following basis:

Property and equipment is as follows as of December 31, 2014:

Depreciation expense for the third fiscal year ended December 31, 2014was $4,404. The use of our property and equipment determines if the depreciation is recorded as general and administrative expenses.

3.2. Inventory

Purchased inventory is valued at acquisition cost. Acquisition costs doesn’t include the purchase cost and indirect acquisition costs such as customs fees, freight costs and storage fees, commissions, insurance charges and discounts, which are recorded as general and administrative expenses or other income as the case may be.

Internally developed inventory is stated at cost of direct materials, direct labour costs and other direct expenses are recorded as general and administrative expenses.

Inventory as of December 31, 2014 total $1,006,679

3.3. Receivables

Upon origination, receivables are stated at their nominal value. At this time no provisions has been established total Account Receivable as of December 31, 2014 totals $257,991

3.4. Payables

Payables are stated at their nominal value. The balance as of December 31, 2014 was $63,829

3.5. Loans

Loans are stated at their nominal value. The portion of loans maturing within one year from the balance sheet date is included in Current Liabilities as Loans Payable and as of December 31, 2014 total $2,666. For other specific financial liabilities, please see Note 4, below.

3.6. Borrowing Costs

Borrowing costs arising from loans attributable to the acquisition, construction or production of fixed assets are added to the cost of those assets. All other borrowing costs are recognised in the profit and loss account in the period in which they are incurred.

F-10

Note 4 – Notes Payable

The Company had notes payable totaling $3,399,543 reflecting principal and accrued interest as of December 31, 2014.

NOTE DISCLOSURE	FACE VALUE		ACCRUED INTEREST

Investment Firm: $150,000 Note issued on May 22, 2014, a corporation loaned the Company $150,000 in exchange for a Promissory Note bearing interest at 8%. The Lender is allowed to convert the promissory note into Company common shares. The accrued interest payable balance on this note and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet was as of December 31, 2014. Balances are shown net of conversions.		66,532		7,557

Investment Firm: $6,000 Note issued on November 22, 2011. A corporation loaned the Company $6,000 in exchange for a Promissory Note bearing interest at 10%. The Lender is allowed to convert the promissory note into Company common shares. The accrued interest payable balance on this note and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet was as of December 31, 2014.		6,000		1,892

Investment Firm: $50,000 Note issued on November 18, 2011. A corporation loaned the Company $50,000 in exchange for a Promissory Note bearing interest at 10%. The Lender is allowed to convert the promissory note into Company common shares. The accrued interest payable balance on this note and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet was as of December 31, 2014.		50,000		478

Investment Firm: $50,000 Note issued on March 12,2014. This corporation loaned the Company $50,00 in exchange for a Promissory Note bearing interest at 10%. The Lender is allowed to convert the promissory note into Company common shares. The accrued interest payable balance on this note and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet was as of December 31, 2014. Balances are shown net of conversions.				2,849

Investment Firm $105,000 Note: on August 22, 2014 this entity loaned the Company $105,000 in exchange for a Promissory Note bearing interest at 10% for a term of one year renewable. The Lender is allowed to convert the promissory note into Company common shares. The accrued interest payable balance on this note was $3,820.83 as of December 31, 2014 and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet.		105,000		3,821

Investment Firm $110,000 Note: on July 18, ,2014 this entity loaned the Company $110,000 in exchange for a Promissory Note bearing interest at 8% for a term of one year renewable. The Lender is allowed to convert the promissory note into Company common shares. The accrued interest payable balance on this note was $4,057.78 as of December 31, 2014 and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet.		110,000		4,058

Investment Firm $100,000 Note: on October 10th, 2014 this entity loaned the Company $110,000 in exchange for a Promissory Note bearing interest at 12% for a term of one year renewable. The Lender is allowed to convert the promissory note into Company common shares. The accrued interest payable balance on this note was $1,503.33 as of December 31, 2014 and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet.		55,000		1,503

F-11

Investment Firm $80,000 Note: on April 20, 2014 this entity loaned the Company $80,000 in exchange for a Promissory Note bearing interest at 18% for a term of one year renewable. The Lender is allowed to convert the promissory note into Company common shares. The accrued interest payable balance on this note was $11,482.09 as of December 31, 2014 and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet.	80,000	11,482

Investment Firm: $11,027.10 Note issued on February 7,2014. This corporation loaned the Company $11,027.10 in exchange for a Promissory Note bearing interest at 18%. The Lender is allowed to convert the promissory note into Company common shares. The accrued interest payable balance on this note and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet was as of December 31, 2014.	11,027	5,705

Investment Firm $75,000 Note issued on August 29 and 30, 2012. This corporation loaned the Company $75,000 in exchange for a Promissory Note bearing interest at 18%, $1,500 is pending for funding. The Lender is allowed to convert the promissory note into Company common shares. The accrued interest payable balance on this note was $24.043 as of December 31, 2014. and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet. Balances are shown net of conversions.	26,984	2,867

Investment Firm: $40,000 Note issued on April 30, 2014. This corporation loaned the Company $40,000 in exchange for a Promissory Note bearing interest at 18%. The Lender and is allowed to convert the promissory note into Company common shares, based on which, Lender converted on January 28, 2014 $9,000 of the note. The accrued interest payable balance on this note and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet was as of December 31, 2014.	31,000	10,877

Individual $69,000 Note: on May 1, 2014 this entity loaned the Company $69,000 in exchange for a Promissory Note bearing interest at 18% for a term of one year renewable. The Lender is allowed to convert the promissory note into Company common shares. The accrued interest payable balance on this note was $9,759.72 as of December 31, 2014 and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet.	69,000	9,760

Private Investor: $50,000.00 Note issued on December 5, 2011. This individual loaned the Company $50,000 in exchange for a Promissory Note bearing interest at 8%. On May, 2012 $28,000 was paid on the Note. The Lender is allowed to convert the promissory note into Company common shares, The accrued interest payable balance on this note and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet was as of December 31, 2014.	22,000	8,228

Investment Firm: On April 29, 2014 Notes issued: $21,739.13, $364,130.43, $434,782.61 and $521,739.00. This corporation loaned the Company $1,342,391.17 in exchange for a Promissory Note bearing interest at 8%. The Lender is allowed to convert the promissory note into Company common shares. The accrued interest payable balance on this note and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet was as of December 31, 2014. Balances are shown net of conversions.	912,700	56,706

F-12

Investment Firm: $20,000.00 Note issued on August 15, Aug-2011. A corporation loaned the Company $20,000 in exchange for a Promissory Note bearing interest at 5%. The Lender is allowed to convert the promissory note into Company common shares, based on which the Note's buyer, Subsequently the note transferred to a non-affiliated second investment firm, which has converted $7,720.58. The accrued interest payable balance on this note and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet was as of December 31, 2014.	12,279	2,105

Investment Firm: $150,000.00 funded $75,000 on July 1, 2014; $75,000 on September 3, 2014 and $34,902.22 (net) on October 22nd 2014. Note issued on May 28, 2014. This corporation agreed to loan the Company $521,739.00 over the times in exchange for a Promissory Note bearing no interest for the first three months. The Lender is allowed to convert the promissory note into Company common shares. No accrued interest payable due to the grace period already mentioned. Accrued Interest Section of the Company’s balance sheet was as of December 31, 2014.	184,902	9,433

Investment Firm $100,000 Note: on July 17, ,2014 this entity loaned the Company $100,000 in exchange for a Promissory Note bearing interest at 12% for a term of one year renewable. The Lender is allowed to convert the promissory note into Company common shares. The accrued interest payable balance on this note was $5,556.67 as of December 31, 2014 and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet.	100,000	5,567

Investment Firm: $60,000 Note issued on October 8, 2014 $104,000 and November 20, 2014 $84,000. This corporation loaned the Company $188,000 in exchange for a Promissory Note bearing interest at 8%. The Lender is allowed to convert the promissory note into Company common shares. The accrued interest payable balance on this note and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet was as of December 31, 2014.	188,000	2,444

Investment Firm: $165,000 Note issued on May 22, 2014. This corporation loaned the Company $150,000 in exchange for a Promissory Note bearing interest at 8%. The Lender is allowed to convert the promissory note into Company common shares. The accrued interest payable balance on this note and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet was as of December 31, 2014.	165,000	3,449

Investment Firm $250,000 Note: on April 24, 2014 this entity loaned the Company $250,000 in exchange for a Promissory Note bearing interest at 18% for a term of one year renewable. The Lender is allowed to convert the promissory note into Company common shares. The accrued interest payable balance on this note was $32,933.32 as of December 31, 2014 and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet.	250,000	32,933

Investment Firm $11,500 Note: on May 23rd 2013 this entity loaned the Company $11,500 in exchange for a Promissory Note bearing interest at 18% for a term of one year renewable. The Lender is allowed to convert the promissory note into Company common shares. The accrued interest payable balance on this note was $5,395.81 as of December 31, 2014. and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet.	11,500	5,396

Private Investor $44,000.00 Note issued on November 15th and December 20th 2012, an individual loaned the Company $44,000 000 in exchange for a Promissory Note bearing interest at 18%. The Lender is allowed to convert the promissory note into Company common shares. The accrued interest payable balance on this note was $9,794.71 as of December 31, 2014. and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet.	13,728	9,795

F-13

Investment Firm: $5,000 Note issued on January 18, 2013, $5,000 Note issued on February 4, 2013, $1,500 Note issued on August 14, 2013; $15,000 Note issued on May 21, 2012, $7,000 Note issued on May 30, 2012, $20,000 Note issued on July 24, 2012, $17,000 Note issued on October 10, 2013, $13,000 Note issued on January 16, 2013, $6,000 Note issued on July 24, 2012, $20,000 Note issued on March 6, 2014 and $10,000 Note issued on Augsust 9, 2012. This corporation loaned the Company $112,500 in exchange for a Promissory Note bearing interest at 18%. The Lender is allowed to convert the promissory note into Company common shares, based on which converted $20,384,34 from Face Value and $67,615.66 from Accrued Interests. The accrued interest payable balance on this note and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet was as of as of December 31, 2014. and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet. Balances are shown net of conversions.	29,763

Investment Firm: $8,877 Note issued on June 25, 2012. This individual loaned the Company $8,877 in exchange for a Promissory Note bearing interest at 8%. The Lender is allowed to convert the promissory note into Company common shares, The accrued interest payable balance on this note and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet was as of December 31, 2014.	8,877	2,587

Investment Firm: $150,000 Note issued on March 18, 2014. This corporation loaned the Company $150,000 in exchange for a Promissory Note bearing interest at 18%, plus $4,882.19 financial expenses. The Lender is allowed to convert the promissory note into Company common shares. The accrued interest payable balance on this note and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet was as of December 31, 2014. Balances are shown net of conversions.	29,500	12,898

Investment Firm: $100,000 Note issued on May 29, 2014. This corporation loaned the Company $95,000 in exchange for a Promissory Note bearing interest at 8%. The Lender is allowed to convert the promissory note into Company common shares. The accrued interest payable balance on this note and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet was as of 31, 2014. Balances are shown net of conversions.	75,000	4,575

Investment Firm $555,000 Note: on June 27,2014 and funded $200,000 on July 2, 2014 this entity loaned the Company $225,000 and $110,000 on December 19, 2014. in exchange for a Promissory Note bearing interest at 10% for a term of one year renewable. The Lender is allowed to convert the promissory note into Company common shares. The accrued interest payable balance on this note was $12,054.17 as of December 31, 2014 and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet.	335,000	12,054

Investment Firm $110,000 Note: on July 29, ,2014 this entity loaned the Company $110,000 in exchange for a Promissory Note bearing interest at 8% for a term of one year renewable. The Lender is allowed to convert the promissory note into Company common shares. The accrued interest payable balance on this note was $3,788.89 as of December 31, 2014 and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet.	110,000	3,789

Investment Firm $250,000 Note: on June 24.2014. Funded $50,000 + 10% IOD on July 1, 2014, this entity loaned the Company $250,000 in exchange for a Promissory Note bearing interest at 12% for a term of one year renewable. The Lender is allowed to convert the promissory note into Company common shares. The accrued interest payable balance on this note was $3,483.33 as of December 31, 2014 and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet.	55,000	3,483

Private Investor: $40,000.00 Note issued on June 1, 2012. This individual loaned the Company $40,000 in exchange for a Promissory Note bearing interest at 8%. The Lender is allowed to convert the promissory note into Company common shares, The accrued interest payable balance on this note and is included in the Convertible Promissory Notes – Accrued Interest Section of the Company’s balance sheet was as of December 31, 2014.	40,000	7,461

TOTAL:	3,153,792	245,751

F-14

As a result of the above, the balance of the notes payable is $3,153,792 and the accrued interest thereon is $245,751.

Other Current Liabilities - The Company had other current liabilities consisting of the following at December 31, 2014:

Taxes			10,393
Payrrol Tax Liability			76,819

Note 5 – ADDITIONAL INFORMATION

Note 5.1 - Stock

Preferred stock

The Company is authorized to issue 15,000,000 shares of preferred stock at a par value $0.001. 1,350,000 shares were issued as of December 31, 2014.

Common stock

The Company is authorized to issue up 4,500,000,000 shares of common stock with a par value of $0.001, under terms and conditions established by the Board of Directors.

The Company had 927,967,208 issued and outstanding common stock shares as of December 31, 2014.

Note 6- Legal Matters

The Company is not aware of any pending or threatened legal matters that would have a material impact on our financial condition.

F-15

Filing Compare · Vapor Group, Inc.