-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Qijx3CR4IlKZK1Tyb5m1f8Dx/5gWd18rEp6tUl4Pp4QJJAHjybztvi1ZRR7ToAlJ bZS0xSRxSoiQwr+pPLFy+A== 0001105944-07-000024.txt : 20070521 0001105944-07-000024.hdr.sgml : 20070521 20070521061753 ACCESSION NUMBER: 0001105944-07-000024 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20070331 FILED AS OF DATE: 20070521 DATE AS OF CHANGE: 20070521 FILER: COMPANY DATA: COMPANY CONFORMED NAME: INTERCARE DX INC CENTRAL INDEX KEY: 0001103310 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PREPACKAGED SOFTWARE [7372] IRS NUMBER: 954304537 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-31281 FILM NUMBER: 07866376 BUSINESS ADDRESS: STREET 1: 6201 BRISTOL PARKWAY CITY: CULVER CITY STATE: CA ZIP: 90230 BUSINESS PHONE: 213-627-8878 MAIL ADDRESS: STREET 1: 6201 BRISTOL PARKWAY CITY: CULVER CITY STATE: CA ZIP: 90230 FORMER COMPANY: FORMER CONFORMED NAME: INTERCARE COM DX INC DATE OF NAME CHANGE: 20010514 FORMER COMPANY: FORMER CONFORMED NAME: INTERCARE COM INC DATE OF NAME CHANGE: 20000114 10QSB 1 icco10qsb033107b.txt FIRST QUARTER 2007 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549 FORM 10-QSB ( X ) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended March 31, 2007 ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Transition Period From ___________ to ____________ COMMISSION FILE NUMBER: 333-57780 INTERCARE DX, INC. ---------------------- (Exact Name of Registrant as Specified in its Charter) CALIFORNIA 95-4304537 ------------------------------- ------------------------ (State of Other Jurisdiction of (I.R.S. Employer Incorporation or Organization) Identification Number) 900 WILSHIRE BOULEVARD, SUITE 500, LOS ANGELES, CALIFORNIA 90017 ---------------------------------------------------------------- (Address of Principal Executive Offices) (213) 627-8878 ---------------------------------------------------------------- (Registrant's telephone number, including area code) N/A ---------------------------------------------------------------- (Former name, former address and formal fiscal year, if changed since last report) Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months and, (2) has been subject to such filing requirements for the past 90 days. Yes ( X ) No ( ) As of March 31, 2006, InterCare DX, Inc., Registrant had 19,403,902 shares of its no par value common stock outstanding. There is currently no public market for this stock. Page 1 of 13 sequentially numbered pages Form 10-QSB First Quarter 2007 InterCare DX, Inc. INDEX PAGE ---- PART I. FINANCIAL INFORMATION Item 1 Financial Statements Balance Sheets - March 31, 2007 2 Statements of Operations for the Three Months Ended March 31, 2007 3 Statement of Cash Flows for the Three Months Ended March 31, 2007 4 Notes to Financial Statements 5-7 Company Overview 8 Item 2 Management's Discussion and Analysis of Financial Condition and Results of Operations 16 Item 3 Controls and Disclosure 18 PART II OTHER INFORMATION Item 1 Legal proceedings 19 Additional Information 19 Signature 19 2 InterCare DX, Inc (UNAUDITED) As of March 31 As of December 31
2007 2006 ====== ====== ASSETS Current assets Cash $ - $ 4,378 Accounts Receivable (Note 1 ) 9,050 4,210 Other Current Assets 29,890 50,137 ------------ ---------- Total Current Assets.. . . . . . . . . . . . . . . . $ 38,940 $ 58,725 ---------- ---------- Plant Property & Equipment 392 417 --------- --------- Total Assets 39,332 59,142 =========== ========== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accounts Payable (Note 1) . . . . . . . . . . . $ 125,441 80,914 Deferred Revenue 29,890 50,137 Advances from Officer 25,550 7,549 ----------- --------- Total Current Liabilities . . . . . . . 180,881 138,600 Long term liabilities . . . . . .. . . . . - - ----------- ---------- Total Liabilities . . . . . . . . . . . 180,881 138,600 ----------- ----------- Liabilities and Stockholders' Equity Stockholders' Equity Common stock (100,000,000 shares authorized no par value ; 19,903,903 shares issued and outstanding as at December 31, 2006 and 19,403,902 as at March 31, 2007(Note 2) . . . . 1,021,203 1,021,203 Accumulated Deficit (1,162,752) (1,120,908) ---------- ------------ Total Stockholders' Equity . . . . . . . (141,549) (79,458) ------------ ------------ Total Liabilities & Equity. . . . . . . . . . . . $ 39,332 59,142 ============ ============
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS 3 InterCare DX, Inc. Income Statement - Unaudited STATEMENT OF OPERATIONS For the Three Months ended March 31,
2007 2006 ====== ===== Revenues . . . . . . . . $ 124,400 $ 1,250 Less: Cost of Revenues . 20,247 - --------- --------- Gross Margin . 104,153 1,250 Operating Expense. . . . 145,997 20,680 ---------- -------- Net Income . . $ (41,844) $ (58,032) ========= ======== Net Income(loss) per share: Weighted average number of shares 19,403,902 19,403,902 Net Loss Per Common Share (Basic and fully diluted) $ (0.00) $ (0.00)
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS 4 InterCare DX, Inc .. STATEMENT OF CASH FLOW UNAUDITED For the Three Months ended March 31,
2007 2006 ==== ==== CASH FLOWS FROM OPERATING ACTIVITIES Net Income (loss). . . . . . . . . . . . . . . $ (41,844) $ (58,032) Adjustments to reconcile net loss to net cash used in operating activities: .......Depreciation 25 - Stock issued for services - 30,000 (Increase) Decrease in Accounts receivables . . . . . . . . . . . . . (4,840) - Inventories. . . . . . . . . . . . . . . . . . - - Other adjustments to income - - Increase(Decrease) in Accounts payables. . . . . . . . . . . . . . . 44,527 - Other Liabilities (20,247) - -------- -------- NETCASH USED IN OPERATING ACTIVITIES . . . . . . . . (22,379) 234 CASH FLOW FROM INVESTING ACTIVITIES Liquidation of Deferred Offering cost - - -------- ------- NETCASH USED FOR INVESTING ACTIVITIES - - CASH FLOW FROM FINANCING ACTIVITIES Proceeds from Borrowings 18,001 - Proceeds from the Sale of Common Stock - - Distribution to shareholders - - (Decrease) increase in Deposits - - -------- -------- NET CASH PROVIDED BY FINANCING ACTIVITIES. . . . . . 18,001 - ---------- --------- Increase (Decrease) in cash . . . . . . . . . . (4,378) 234 CASH AT BEGINNING OF PERIOD. . . . . . . . . . . . . 4,378 147 ----------- ---------- CASH AT END OF PERIOD. . . . . . . . . . . . . . . . $ - $ 381 =========== ==========
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS 5 The accompanying notes are an integral part of this statement. InterCare DX, Inc. Notes to the Financial Statements Basis of Reporting The interim accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles ("GAAP") for interim financial information and with the instructions to Form 10-QSB. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal, recurring accruals) considered necessary for a fair presentation have been included. For further information, management suggests that the reader refer to the audited financial statements for the year ended December 31, 2006 included in its Annual Report on Form 10-KSB. Operating results for the three-month period ended March 31, 2006 are not necessarily indicative of the results of operations that may be expected for the year ending December 31, 2007. The interim financial statements of InterCare DX, Inc., for the three months end March 31, 2007 and 2006 are unaudited. The financial statements are prepared in accordance with the requirements for unaudited interim financial statements. In the opinion of management the accompanying financial statements contain all adjustments, consisting only of normal recurring accruals, necessary for a fair presentation of the Company's financial position as of March 31, 2007 and December 31, 2006 and the results of operations and cash flows for the three Months ended March 31, 2006 and 2007 respectfully. Note 1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES InterCare DX, Inc., is an innovative software products development and services company, specializing in developing healthcare management and information systems solutions. The company markets and resells the InterCare Clinical Explorer (ICE(tm), which is designed to integrate every aspect of the healthcare enterprise as well as the InterCare Vascular Diagnostic Centers device, which is a non-invasive cardiovascular diagnostic center. 1. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. 2. Account Receivable The Company recognizes account receivable to the extent that revenues have been earned, and collections are reasonably assured. 3. Inventory Inventories consists of purchased computer and software products, stated at the lower of cost or market. Cost is determined by the first-in, first-out (FIFO) method of valuation. 4. Property and Equipment Property and equipment is recorded at cost. Maintenance and repairs are charged to expense as incurred. Major renewals and betterments are capitalized. When items of property are sold or retired, the related cost and accumulated depreciation is removed from the accounts and any resultant gain or loss is included in the results of operation. Capital assets are depreciated by the straight-line method over estimated useful lives of the related assets, normally five (5) to seven (7) years. Property and equipment consists of the following as of
March 31, 2007 December 31, 2006 ===== ===== Computer Hardware & Software $68,681 $68,681 Less: Accumulated Depreciation 68,289 68,264 ------- ------- $ 392 $ 417 ======== =======
6 5. Advertising The company has the policy of expensing advertising costs as incurred. There were no advertising costs charged to expense for the quarter ended March 31, 2007. 6. Stock-based Compensation Non Employee Stock-based compensation plans are recorded at fair value measurement criteria as described in SFAS 123, "Accounting for Stock-Based Compensation", and EITF 96-18, "Accounting for Equity Instruments That are issued to other than employees for acquiring, or in conjunction with selling of Goods or Services" Employee Stock-based compensation plans are accounted for, using the intrinsic value method prescribed in Accounting Principles Board Opinion No. 25, "Accounting for Stock issued to Employees". Under this method, compensation cost is recognized based on the excess of the fair value at the grant dates for awards under those plans, as determined by the Company's officers and directors. 7. Recognition of Revenues. Revenues from sale of software are recorded upon delivery and installation of software at customer sites. The company provides a limited amount of post-contract customer support (PCS) at no additional charge Pursuant to SOP 97-2, the value of the PCS component of any sale is estimated based on vendor specific evidence of fair value (i.e. catalogue price). Revenues in respect of the value of the PCS, are recognized as earned ratably over the PCS period (generally 90 days). The company provides software implementation and professional services for all its enterprise software sold to its clients on a contractual basis. Professional services are billed on either an hourly rate or flat rate basis, and revenues recognized ratably over the service period, or upon completion of related services. Reimbursable expenses incurred on behalf of the customer are billed to the customer, and credited against the applicable expense. The customer has the option to purchase an implementation services from the Company. Revenues from implementation services contracts are deferred and recognized as earned as services are performed in contracts with hourly billing terms; and as related services are performed or expiration of the terms of the contract in flat rate contracts. The customer has the option to purchase a maintenance contract from the Company. Revenues from maintenance component are deferred and brought recognized income ratably over the maintenance service period. Currently, there are no such contracts in existence. The Company's proposed maintenance charges as based on vendor specific evidence of fair value. 8. Software Development Cost Software development costs are charged to current operations 9. Fair Value of Financial Instruments and Concentration of Credit Risk. The carrying amounts of cash, receivables, and accrued liabilities approximates fair value because of the immediate or short-term maturity of these financial instruments. 10. Income Taxes The Company has made no provisions for income taxes because of accumulated business and tax losses since its inception. 11. Basic and Diluted Net Loss Per Common Share. In accordance with SFAS No. 128, "Computation of Earnings Per Share," basic Earnings/(loss) per share is computed by dividing the net earnings available to Common stockholders for the period by the weighted average number of common shares outstanding during the period. 12. Stockholders' Equity For purposes of computing the weighted average number of shares, all stock 7 issued with regards to the founding of the Company is considered to be "cheap stock" as defined in SEC Staff Accounting Bulletin 4D and is therefore counted as outstanding for the entire period. Common equivalent shares, consisting of incremental common shares issuable upon the exercise of stock options and warrants are excluded from diluted earnings per share calculation if their effect is anti-dilutive. 13. Recent Accounting Pronouncements The Company has received current accounting pronouncements and has determined That the adoption of current accounting pronouncements would not have a material impact on the Company's financials. 14. Related Party Transactions Expenses related to the Company are routinely paid by Meridian Holdings, Inc.,(an affiliated Company) under a management services agreement between Meridian And the Company. As such amounts are recorded as payable to Meridian, as incurred. 15. Joint Venture On June 14, 2005, the Company executed a Memorandum of understanding (MOU) with the Saudi German Hospital Group, whereby both parties desire to form a joint venture limited liability company in the middle east region for the purposes of selling InterCare's ICE(tm) software licenses to physicians and other healthcare providers. As of March 31, 2007, no operations have commenced related to this joint venture. 16. Going Concern The accompanying financial statements have been prepared in conformity with Generally accepted accounting principles, which contemplate continuation of the Company as a going concern. The Company has incurred losses since its inception and has not yet been successful in establishing a profitable operations. These factors raise substantial doubt about the ability of the Company to continue as a going Concern. Continuance of the Company as a going concern is dependent upon obtaining additional working capital through loans and/or additional sales of the Company's common stock. There is no assurance that the Company will be able successful in raising this additional capital or achieving profitable operations. The accompanying financial statements do not include any adjustments that might result from the outcome of these uncertainties. The Company has initiated commercialization of the InterCare Vascular Diagnostic Center technology. It has as established a sales force to Market the device and ICE(tm) Software Technology. So far only a limited sales has occurred. Management continues to monitor these activities. Subsequent Events The company recently entered into a software licensing agreement with Microsoft Corporation for the Conference XP technology to be integrated with ICE software for the purposes of commercialization. 8 InterCare DX, Inc. Business Overview InterCare DX, Inc. formerly known as InterCare.com dx,, is organized in the State of California. We are an innovative software products and services company specializing in providing healthcare management and information systems solutions, with our main office located at 6201 Bristol Parkway, Culver City USA, and international partners located worldwide. In business since 1991, we have created, published, and marketed software products embedded with sound, text and video for the purpose of relaxation training and stress management. We have also developed Internet-ready applications for healthcare transactions management as well as medical and health-related content and information targeted toward the education, consumer, and healthcare industry markets. Our Products and Services InterCare Vascular Diagnostic Centers (IVDC) This is the latest product being commercialized by InterCare, after an extensive patient, provider and health insurance plan acceptance test. It is a freestanding diagnostic device, that employs a revolutionary non-invasive inexpensive, easy to use procedure that has been clinically proven to detect coronary artery disease (CAD) earlier and more accurately than existing Techniques. CAD. The IVDC Device has FDA pre-market approval, validated clinical trial data, Medicare/Medicaid and Indemnity insurance re-imbursement eligibility. In addition to coronary arterial disease, the device can also be used in the non-invasive diagnosis of peripheral vascular disease and estimating endothelial function Current cardiovascular research has confirmed that heart attack, stroke, and most forms of peripheral vascular disease are caused by abnormalities in the arterial wall. InterCare Vascular Diagnostic Center is a new technology that has been developed that allows physicians to assess the status of the arterial wall. The test is rapid and painless and can be performed with no risk to the patient in a physician's office. In addition, the cost of the testing is competitive with other noninvasive cardiovascular tests. For the first time, physicians will know how their patient's arteries compare to healthy subjects of the same gender and age. Further, they will know how their patient's arteries compare to subjects with known peripheral and coronary arterial disease, which is the direct cause of over one million deaths annually, generating over $100 billion direct and $180 billion indirect treatment costs annually. The IVDC technology will be most helpful in identifying subjects at risk. With this identification treatment will start early and outcomes will improve. Finally, this testing will target subjects who will benefit from more expensive and perhaps invasive testing. Market and Value Proposition Over 50% of the deaths attributed to CAD are of patients that exhibit no prior symptoms of heart disease. Further, existing procedures that accurately detect CAD are invasive and expensive, and therefore unlikely to be used in cases where symptoms are not present. The IVDC device enables primary care physicians to easily identify CAD in situations where it would otherwise go undetected. Currently, primary care physicians test for CAD using risk profile screens, which include family history, lifestyle, and physiologic measurements of height, weight, body fat, blood pressure, blood glucose levels, and blood lipid levels. In situations where these screens indicate a high propensity for CAD, patients undergo more sophisticated tests such as Resting Electrocardiograms (ECGs), Stress ECGs and Stress Echocardiograms. In focus group surveys, primary care physicians indicated that the most common follow-up test is the Stress ECG or Echocardiogram. These tests are only suggestive; to actually confirm CAD a patient must undergo a coronary angiography procedure that enables the physician to directly view arterial obstructions. This is an invasive test that is not performed by a primary care physician but instead referred to an outpatient or inpatient facility, significantly increasing the expense to both the patient and the insurer. Further, this test is most accurate only for late-stage CAD, when treatment often requires pharmaceuticals or surgery rather than lifestyle changes that can be effective if a physician identifies CAD early. The inaccuracy of risk profile testing and echocardiograms is a significant reason CAD is not detected early and a primary reason CAD is fatal in patients that do not exhibit prior symptoms. Clinical trials indicate that risk profile testing does not identify CAD when it is present (a False Negative) in males 60% of the time, and 30% of the time in females. One of the IVDC Procedures (called a "Vasogram"), however, is 14% more predictive than any of the risk factors alone and 45% more predictive when used in combination with 9 traditional risk factor screening. This improved accuracy reduces False Negatives from 60% to 27% in males and 30% to 23% in females. Furthermore, the Vasogram is more accurate than the follow-up tests typically administered by primary care physicians, such as Stress ECG and Stress Echocardiogram. In clinical trials comparing follow-up tests, 177 patients underwent MRI, Stress ECG, Stress Echocardiogram (the most popular tests) and Vasogram. The MRI (a visual measure of CAD) found CAD in 37 patients. Neither the Stress ECG nor the Echocardiogram identified any of these patients, while the Vasogram identified 76%. In addition to the diagnostic benefits of the Vasocor device, it is also economically advantageous to the primary care physician. Typically, patients that score high in risk factor analysis and Stress Echocardiogram are referred for coronary angiography. This test is not only More expensive, but does not generate revenue to the referring physician. Furthermore, in cases where it is actually not necessary, the test results in significantly higher costs to the patient and insurer. A Vasogram, in contrast, is easily administered in the primary care office by unskilled staff in less than 15 minutes. Furthermore, by accurately assessing CAD early in its development, the IVDC device can reduce overall costs to patients and insurers by identifying the disease early enough so that lifestyle changes are effective forms of treatment rather than requiring pharmaceutical or surgical treatment. The IVDC device offers a compelling value premise of accuracy, simplicity and cost savings to physicians, patients and health insurance providers. Clinical Trials and Publications Independent medical researchers have conducted three major clinical trials in four leading academic medical centers in the United States and two in Europe that validates the technology. This clinical testing has extended over eight years and has involved multiple versions of the device and associated technology. The first clinical trial involved comparing Arterial Compliance measurements with coronary artery disease as determined by invasive coronary angiography (Vasogram Improvement Program). The second clinical study was undertaken to determine repeatability of testing and expected values from a population of subjects over a large age range without cardiovascular disease (Precision Study). Because coronary angiography does not identify early cardiovascular disease, the third clinical trial compared Arterial Compliance measurements with degree of aortic atherosclerotic disease as measured by Magnetic Resonance Imaging (MRI). This study included subjects with a wide range of cardiovascular disease (Accuracy Study). Regulatory Approvals The VVDC device has received 510(k) pre-marketing approval by USFDA, in addition to a UL approval. In summary, the Company has been given clearance to commercialize the InterCare Vascular Diagnostic Centers in the general areas of Non-invasive cardiovascular disease assessment. Reimbursements Considerations Current Non-Invasive Cardiovascular disease management CPT and ICD-9 Codes are applicable for the Vasogram as well as for the Model 300's other built in applications such as Ankle / Arm Index Module, Segmental Limb Pressure Module, and Endogram Module (which measures Endothelial Function). The Medicare/Medicaid 80% reimbursement level for each of the applications currently return in the range $198 to $245. It is possible to apply to the AMA for a specific CPT Code for the Vasogram and Endogram Modules. There is no guarantee that the company will be able to obtain a new AMA specific CPT Code or these re-imbursement levels will be sustained for a very long time. Benefits The Vasogram addresses the need for an early-stage, non-invasive procedure to identify CAD patients without the need for outpatient services or clinics and represents a benefit to the patient, primary care physician, and the medical insurance industry. The Vasocor Model 300 is operational on a commercial scale, has proven effectiveness in robust clinical trials, has achieved FDA clearance for marketing and sales, and has attractive reimbursement status. Market Size The market potential of IVDC technology for the diagnosis of CAD in the primary care physician's office and other locations is substantial. Current procedures for CAD range in price from $500 for an ECG Stress Test up to several thousand dollars for an angiogram. The total number of CAD diagnostics performed in the United States exceeds 80 million per year. Initial estimates 10 for procedures involving VVDC technology indicate that the total market opportunity, as estimated by McKinsey & Company, is between $300 million and $500 million of a total $1.4 billion market potential. Coronary Artery Disease Heart disease is still the single largest killer of Americans, claiming nearly a million lives a year. Approximately 60 million Americans are at risk of CAD. The direct cost of treating heart disease in the U.S. reached $100 billion in 1999, while the indirect costs exceeded $180 billion. Successfully diagnosing CAD is complicated by the fact that over 50% of people who die from heart attacks experience no symptoms of heart disease prior to the initial event, which is often death. Atherosclerosis, fatty substance deposits or plaque in arteries, causes structural changes in the arterial wall that alters the arteries' physical properties. Two types of plaques are Calcified plaque and Vulnerable plaque. Calcified plaque is a hard lesion and is a manifestation of late stage disease. Vulnerable plaque is a soft, lipid-rich pool with a hard surface that can rupture into the arterial flow surface, leading to rapid obstruction. These events that occur in patients with no previous symptoms, and which are responsible for over 50% of heart attack deaths, are generally thought to be caused by Vulnerable plaque, not by Calcified plaque. There is a significant need for a new technology capable of identifying early symptoms of cardiovascular disease, including Vulnerable plaque. Such diagnostic tools, combined with recent and upcoming intervention techniques, create the possibility of treating patients at an earlier stage in the disease, thereby preventing some of the more than one million heart attacks that occur annually in the United States. Atherosclerosis is the underlying abnormality associated with coronary artery disease (myocardial infarction or heart attack), cerebrovascular accident (stroke), and peripheral vascular disease (diabetes, amputations, etc). Coronary artery disease is the leading cause of death in the United States; cerebrovascular accidents are the third leading cause of death and the number one cause of permanent disability Major risk factors for atherosclerosis includes: cigarette smoking, hypertension, diabetes, elevated blood lipids, lack of exercise, and obesity. Modern medicine has developed powerful weapons to combat these risks. Despite these advances, a substantial number of coronary and atherosclerosis-related events occur each year in individuals who currently do not qualify for drug therapy based on current primary-prevention guidelines. Therefore, more effective strategies are required to identify individuals who would benefit from more aggressive therapy. Atherosclerosis is known to thicken the arterial wall, thus making the artery more stiff and resistant to expansion secondary to pressure change during the cardiac cycle. The Vasogram(tm) device has the capability of accurately measuring arterial stiffness in vessels in the lower extremity (thigh and calf levels). This device is noninvasive (i.e. safe), inexpensive, not space restrictive, and can be operated by non-physicians and non-nurses. Identification of Coronary Artery Disease Currently, no effective, low-cost diagnostic exists for CAD in the primary care physician's office. The less expensive CAD diagnostics, such as the ECG and the ECG Stress Test (including Echocardiography), are blinded to early CAD and therefore are limited to identifying advanced atherosclerotic coronary disease. Once the disease is at such a stage, treatment is costly. In addition, a significant number of patients fall into the "gray area" where physicians are uncertain as to whether the patient should be referred for additional testing, put on medication, or simply followed with risk factor modification. The relatively more accurate diagnostic tests, such as Stress Thallium, are somewhat difficult to perform and interpret, and costly to administer. Coronary angiography is widely considered to be the "gold standard" for diagnosing CAD; however, this procedure is both costly and highly invasive. All of these tests also are indicative of advanced atherosclerotic disease (or other cardiac problems not associated with atherosclerosis). None of these procedures are routinely performed in the office of primary care physicians. Peripheral Arterial Disease (PAD) PAD is atherosclerosis involving peripheral arteries, such as the brain, extremities, and visceral vessels. PAD is a highly prevalent disease that affects approximately 8 to 12 million people in the United States. In a recent study it was estimated over 50% of patients with PAD elude diagnosis. PAD is clearly associated with increased risk of other vascular disease, which include cardiac and cerebro-vascular mortality and morbidity. Competition The existing CAD diagnostics available to primary care physicians have several 11 important limitations that create significant opportunities for a new, low-cost, office-based, procedure such as VVDC technology. First, as CAD diagnostics, both the ECG and the ECG Stress Test produce a relatively high number of false negatives and false positives. More importantly these tests are limited to the diagnosis of advanced atherosclerotic disease. An estimated 50% of patients given an ECG receive borderline test results and 25% of patients tested on an ECG Stress Test also fall into the borderline category. Although the Stress Thallium and Echocardiogram are more accurate than the ECG and the ECG Stress Test, these procedures are also more expensive and more difficult to perform and interpret. Coronary angiography is widely considered to be the "gold standard" for diagnosing CAD; however, this procedure is both costly and highly invasive, and is a late stage disease diagnostic tool. Physicians have estimated, between 10-20% of coronary angiograms performed find little or no disease in the patient. Further, intravascular ultrasound has shown coronary angiograms often miss significant atherosclerotic disease, when coronary lumen is not compromised. With the exception of ECGs, which are often conducted in a physician's office, the majority of the existing CAD diagnostics take place in hospitals or cardiac clinics. The high cost of the equipment, skill needed to perform the tests and space Requirements prohibit primary care physicians from using most CAD diagnostics in their office. Currently, primary care physicians do not have a low-cost assessment alternative that they can use in their own office to assist them in determining whether a patient should be referred for further testing or whether life style modifications and lipid-lowering drugs and other pharmacological therapies are the appropriate next step. For PAD the existing commonly used assessment tool is Ankle/Brachial Index (ABI). This noninvasive procedure can accurately identify patients with PAD. To conduct an ABI procedure with current technology, the examiner needs to be skilled in using Doppler ultrasound. This is a technique-sensitive procedure whose results may vary depending on the skill of the examiner. Thus, this method is not widely used in primary care offices. The VVDC device includes the ABIgram(tm) module, which is a Doppler-free method of performing Ankle/Brachial Index with this module virtually any health care provider can obtain this important measurement. If PAD is found, the device offers another PAD tool called the PADogram(tm). This module measures thigh and calf segmental limb systolic pressure, which is helpful in identifying location of arterial obstruction. New Competitors / Complementers Due to the attractiveness of this market, there are several new technologies at Various stages of development aspiring to meet the need for new CAD diagnostics. The strongest likely emerging competitors to arterial compliance are the C-reactive protein assay, IL-1 genetic test, and EBCT/Ultra Fast CT. Each of these technologies detects coronary artery disease at different stages in the progression of the disease. Arterial compliance measurement is the only early assessment procedure that is noninvasive, cost effective and easy to perform in primary care physician's office. C-reactive Protein Assay The C-reactive protein assay is a blood test that may be able to add information about a patient's risk for a coronary event beyond traditional risk factors. In clinical trials conducted on 1,000 frozen blood samples from the Physician's Health Study, subjects with high protein levels were three times as likely to have a stroke or heart attack as those with lower levels. In another trial conducted on 3,000 frozen blood samples, C-reactive protein levels declined 38% in subjects given Pravachol (statin lipid-lower drug) and the effect was independent of changes in cholesterol. A new test for C-reactive protein, developed at Brigham and Women's Hospital in Boston and launched in November 1999, is gaining momentum in the marketplace. This test is thought to be much more accurate than a previous test for C-reactive protein that met with limited success in the marketplace. At this point, however, there are no studies published that show C-reactive protein to have predictive power above Framingham Risk Profiles. Further, in clinical trials, Vasogram(tm) endpoints correlated more closely with aortic atherosclerosis than C-reactive protein measurements. Interleukin-1 (IL-1) Genetic Test The IL-1 genetic test is a finger-stick blood test that detects genetic Predisposition for CAD by examining factors that regulate the inflammatory process. Clinical trials conducted at the Mayo Clinic revealed a strong association between IL-1 and CAD in patients 60 years old or younger. The test was developed by Interleukin Genetics, Inc. and is expected to be launched in the next few years at a cost of approximately $200 per test. 12 EBCT / Ultra Fast CT The EBCT/Ultra Fast CT uses imaging to detect coronary arterial calcification, which has been shown to be correlated with the severity of atherosclerosis. In clinical trials, a calcium score of over 400 indicated a 15 fold greater risk of a major coronary obstruction. An eighteen-month study of 1200 asymptomatic patients showed that those who experienced coronary events had calcium scores 6.5 times higher than those who had no such events. In addition, a 150 patient Clinical trial of EBCT's efficacy as a treatment monitor revealed a strong Correlation between reductions in cholesterol and calcium deposits. EBCT is manufactured by San Francisco based Imatron which has since been acquired by General Electric Corporation. InterCare Clinical Explorer (ICE(tm)) InterCare Clinical Explorer (ICE ), is a developed by InterCare DX, Inc., an innovative enterprise level clinical documentation application designed to integrate virtually all aspects of the health care enterprise, both inpatient and outpatient. ICE(tm)'s extensive, scalable system flexibility allows its adaptation to clinical workflow, operating independently in centralized and decentralized facilities. The program features intuitive order entry, "tapering" orders, a clinical knowledge base, digital video enhanced patient education, real-time electro-physiological data capture and display, voice command and recognition, a digital dictation module, and numerous other capabilities to complement and document the diagnostic and treatment processes, including unlimited free-text notes. We have signed partnership and/or reseller agreements in place to utilize, or have plans to incorporate the following third-party products and/or technology into ICE : The strength of ICE application is derived from differentiated core technologies consisting of: Mainstream SQL Database with full open architecture; human anatomy and graphical user interfaces that simplify documentation and information access; data mining and data query tools; end-user tool sets; and interface capabilities to facilitate peaceful coexistence with other systems. Medical knowledge base / lexicon ICE Clinical Observation Language (ICOL(tm)) - -------------------------------------------- There is no single published or accepted language that comprehensively and logically describes the discrete facts about a patient's clinical condition that can be used scientifically to create a standardized methodology for analyzing a myriad of clinical observations, interventions and outcome in medicine, hence the development of ICE Clinical Observation Language vocabulary (ICOL). The unique feature of ICOL is that it is made up of short phrases that could be plugged-in to a note without any modification, or joined with other phrases in the ICOL knowledge base to form a complete sentence. Developed by the InterCare team of clinical experts, ICOL contains over 50,000 phrases and clinical terminology which are linked to over 200,000 clinical terms and codes that could be customized or used as-is to generate a research-quality outcome measures without compromising the quality of clinical documentation and patient care. ICE Clinical Observation Language (ICOL) provides the corroborating 'glue' that ties together the outcomes, diagnoses, interventions, procedures, activities and patient responses to care delivery into the complete scientific, granular, and comparable clinical content. When a significant number of patient encounters are recorded using the same clinical vocabulary, the value of the resulting clinical information is profound. Use of this data will facilitate unprecedented and rapid improvement in the consistency and quality of care delivery for an individual patient. This capability will be facilitated by the ability to accurately and consistently measure and improve patient outcomes in response to care rendered while at the same time reducing the cost. ICE(tm) clinical documentation provides the necessary granularity and consistency in the recording of patient health observations required for this process to work. Summary of the languages implemented and supported in ICE(tm) are: - - International Classification of Diseases (ICD-9-CM) - - Alternative Complementary Therapy Code (ABC code) - - CPT - - Nursing Interventions Classification (NIC) - - Nursing Outcome Classification (NOC) - - NANDA - - ICE Clinical Observation Language (ICOL(tm)) - - DSM-IV - - Other Third party clinical libraries such as SNOMED, LOINC and Read Codes. 13 Industry Trend The US Initiative The Bush Administration's health care agenda has outlined a comprehensive vision for helping all Americans benefit from the potential of American health care in the 21st century. The President's health care agenda is designed to improve the accessibility, affordability and accountability of health care for every American -- and to make sure that American health care keeps getting better. ICE is positioned to facilitate many aspects of the Bush Administration's health care initiatives. OUR COMPETITION InterCare DX, Inc., participates in a large and growing marketplace domestically and internationally. The US healthcare information systems and services market currently represents a $20 billion annual market. Electronic Medical Record (EMR), CDR and clinical systems, being a part of an emerging arena, are accountable for $2 US Billion of this sum Clinical systems' market volume is expected to accelerate its growth because of the recent HIPAA regulations requirements. The most pro-active e-health players are Eclypsis, Cerner, GE Medical, IDX and McKesson-HBOC. yet, each of these players has thousands of existing customers operationally using its legacy systems. Thus, their e-health transition strategy is slow both technically and business wise. Mergers or consolidations among our competitors, or acquisitions of small competitors by larger companies, would make such combined entities more formidable competitors to us. Large companies may have advantages over us because of their longer operating histories, greater name recognition, or greater financial, technical and marketing resources. As a result, they may be able to adapt more quickly to new or emerging technologies and changes in customer requirements. They can also devote greater resources to the promotion and sale of their products or services than we can. For the above reasons, we may not be able to compete successfully against our current and future competitors. Increased competition may result in reduced gross margins and loss of market share. OUR COMPETITIVE ADVANTAGE - OUR KNOWLEDGEABLE AND GROWING SALES FORCE AND TECHNICAL STAFF. We will be making sure that the sales force is trained on the "high-end" networking elements in which we deal so they will be able to service the needs of their customers. - OUR BUSINESS MODEL COST, EFFICIENCY AND FLEXIBILITY. We have addressed the largest cost factor in the methodology for deploying our services through an outsourcing strategy rather than a building the human resources from the scratch strategy. This keeps start-up costs as low as possible. - OUR STRATEGIC PARTNER STRENGTH. Partnerships with CGI Communications Services, Inc., Meridian Holdings, Inc., Meganet Corporation, Sager Midern Computers., Acer America Corporation, ViewSonic Corporation, Microsoft Corporation, Tech Data Corporation, and QRS Diagnostics, Inc., will give us the ability to deliver our software products faster and at a lower cost than the competition - INTEGRATION. We can seamlessly integrate all of the different technological solutions and custom applications development. We use different strategic partners to tailor the optimum solution for our customer. - AUTOMATION AND ADVANCED TELECOMMUNICATIONS TECHNOLOGY. Our Network Management tools are automated which leads to less downtime, and lower labor costs. We use the latest equipment, work closely with strategic partners that are forerunners in their fields, and are not hampered by existing legacy infrastructures. - OUR CUSTOMIZED CUSTOMER APPROACH. We emphasize direct relationships with our customers. These relationships enable us to learn information from our customers about their needs and preferences and help us expand our service offerings to include additional value-added services based on customer demand. We believe that these customer relationships increase customer loyalty and reduce turnover. 14 In addition, our existing customers have provided customer referrals and we believe strong relationships will result in customer referrals in the future. Our success depends upon careful planning and the selection of partners. We can meet the customer's needs more efficiently with entrenched procedures. This enables us to excel at customer service. OUR BUSINES STRATEGY Our current efforts are targeted on taking advantage of our strengths in the application of high technology in the following areas: - The development and/or acquisition, through licensure or purchase, of third party technologies to be integrated into ICE software. - The development, through licensing and/or acquisition, of streaming video technology to facilitate the delivery of high-resolution video-based tele-medicine and other content over the Internet. The server-side software would be marketed to Internet and intranet providers. A basic client-side browser plug-in would be offered as a free download from InterCare DX, Inc., while a more robust stand alone player would be offered for sale as an upgrade. InterCare most apparent weaknesses when operating in the US market are: - - Very small customer base in the USA - - Partial proof/testimony of live enterprise sites using ICE(tm) in the USA - - Insufficient customer services and support infrastructure in the USA - - Perception of a small ("thin") company in comparison with well established (and public) US healthcare IT companies - - Limited number of strategic partners in complementary expertise areas Strengths InterCare strengths when operating in the US market are: - - Point-Of-Care EHR management, care standards, workflow management, personal productivity management, common enterprise knowledge base, enterprise data warehouse, legacy integration middleware and data mining, which are generally available (ICE(tm)) - - ICE(tm) architecture initially designed to support Internet (n-tier) implementations - - ICE(tm) architecture supportive of concurrent multi-lingual users - - ICE(tm) architecture supportive of remote administration and maintenance - - InterCare control over competitive product packaging and pricing strategies - - InterCare proven quick turn-around compliance to market trends and demands (6-9 months between major versions) - - InterCare competitive lower cost of enterprise product development - - Extensive, multi-level customization of ICE(tm) software programs' components, requiring no source code intervention - - Compliance with HIPAA through customer controlled security business rules. - - InterCare expects its transition to the e-Health market space, coupled with its revised service-based sales model, to make these strengths a significant competitive advantage over its competition. Risk Factors CHANGES IN THE HEALTH CARE INDUSTRY COULD ADVERSELY AFFECT OUR BUSINESS. The $1 trillion health care industry is currently going through a period of tremendous change. Nowhere is this more evident than the patient care delivery network where the three main components--physician groups, insurers and hospitals - are scrambling for market share, volume and control. The health care industry is also subject to changing political, economic, and regulatory influences. These factors affect the purchasing practices and operations of health care organizations. Changes in current health care 15 financing and reimbursement systems could cause us to make unplanned enhancements of applications or services, or result in delays or cancellations of orders, or in the revocation of endorsement of our applications and services by health care participants. Federal and state legislatures have periodically considered programs to reform or amend the U.S. health care system at both the federal and state level. Such programs may increase governmental involvement in health care, lower reimbursement rates, or otherwise change the environment in which health care industry participants operate. Health care industry participants may respond by reducing their investments or postponing investment decisions, including investments in our applications and services. Many health care industry participants are consolidating to create integrated health care delivery systems with greater market power. As the health care industry consolidates, competition to provide products and services to industry participants will become even more intense, as will the importance of establishing a relationship with each industry participant These industry participants may try to use their market power to negotiate price reductions for our products and services. If we were forced to reduce our prices, our operating results could suffer as a result if we cannot achieve corresponding reductions in our expenses. Most recently, the Center for Medicare and Medicaid Services announced that it has released a beta version of the Veteran Administration EMR software called called Vista Office(Veteran Health Information Systems and Technology Architecture) (www.vista-office.org), for download by physicians free of charge to use in their offices. This application is like the VA EMR, popularly known as VisTA and uses outlines and facilitates the documentation of what has been done for prevention purposes using "form filled hypertext" whereby one clicks on questionnaire answers (in outline form) and the text is automatically generated in the note. The application is written in Delphi, and the database is Intersystems' Cache - a hierarchical database.(www.intersystems.com. The final release of this software is still pending, and the impact of this move by the Federal Government is believed to encourage physicians to transition from paper medical record keeping to an electronic one. For the above reasons, we may not be able to compete successfully against our current and future competitors. Increased competition may result in reduced gross margins and loss of market share. GOVERNMENT REGULATION OF THE HEALTH CARE INDUSTRY COULD ADVERSELY AFFECT OUR BUSINESS. We are subject to extensive regulation relating to the confidentiality and release of patient records. Additional legislation governing the distribution of medical records has been proposed at both the state and federal level. It may be expensive to implement security or other measures designed to comply with new legislation. Moreover, we may be restricted or prevented from delivering patient records electronically. For example, until recently, the Health Care Financing Administration guidelines prohibited transmission of Medicare eligibility information over the Internet. Legislation currently being considered at the federal level could affect our business. For example, the Health Insurance Portability and Accountability Act of 1996 mandates the use of standard transactions, standard identifiers, security, and other provisions as amended. We are designing our platform and applications to comply with these proposed regulations; however, until these regulations become final, they could change, which could cause us to use additional resources and lead to delays as we revise our platform and applications. In addition, our success depends on other health care participants complying with these regulations. Furthermore, our recent involvement with the VVDC technology makes us an FDA regulated entity. The release of future VVDC products will require FDA approval. We will be seeking for European Union approval or the CE mark, in order to market our product in European Countries. There is no guarantee that such approval will be obtained in a timely manner or at all. Any delay in obtaining such approval will impact our revenue. EMPLOYEES We have outsourced our human resource services to Meridian Holdings, Inc. Also, we have independent sales force agreement with various vendors who sale and market all our products and services. We have no collective bargaining agreement. DESCRIPTION OF PROPERTY We are presently occupying 1/3 of an office space leased by Meridian Holdings, Inc., our parent company, at 6201 Bristol Parkway, Culver City California. The agreed cost attributable to us for the use of the facility is based on 1/3 of the total amount of cost to Meridian Holdings, Inc., for operating the suites. 16 LEGAL PROCEEDINGS From time to time, we may be engaged in litigation in the ordinary course of our business or in respect of which we are insured or the cumulative effect of which litigation our management does not believe may reasonably be expected to be materially adverse. With respect to existing claims or litigation, our management does not believe that they will have a material adverse effect on our consolidated financial condition, results of operations, or future cash flows. RISKS ASSOCIATED WITH MANAGING GROWTH The Company's anticipated level of growth, should it occur, will challenge the Company's management and its sales and marketing, customer support, research and development and finance and administrative operations. The Company's future performance will depend in part on its ability to manage any such growth, should it occur, and to adapt its operational and financial control systems, if necessary, to respond to changes resulting from any such growth. There can be no assurance that the Company will be able to successfully manage any future growth or to adapt its systems to manage such growth, if any, and its failure to do so would have a material adverse effect on the Company's business, financial condition and results of operations. MARKET FOR COMMON STOCK The Company's Common Stock is traded on the Bulletin Board maintained by the National Association of Securities Dealers, Inc. under the symbol "ICCO." The price range of the Company's Common Stock has varied significantly in the past months ranging from a high bid of $.20 and a low bid of $0.02 per share. The above prices represent inter-dealer quotations without retail mark-up, mark-down or commission, and may not necessarily represent actual transactions. SELECTED FINANCIAL DATA The Company had net working capital of $ (141,941) as at March 31, 2007 compared to networking capital of $ (79,458) during as at December 31, 2006. The decrease in working capital is due marketing and selling expense of the IVDC device. The selected financial data set forth above should be read in conjunction with "Management's Discussion and Analysis of Financial Condition and Results of Operations" and the financial statements notes thereto. MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion should be read in conjunction with our financial statements and notes, as well as the other information included elsewhere in this prospectus. Our discussion contains forward-looking statements that involve risks and uncertainties, including those referring to the period of time the Company's existing capital resources will meet the Company's future capital needs, the Company's future operating results, the market acceptance of the services of the Company, the Company's efforts to establish and the development of new services, and the Company's planned investment in the marketing of its current services and research and development with regard to future endeavors. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including: domestic and global economic patterns and trends. LIQUIDITY AND CAPITAL RESOURCES OF THE COMPANY Long-term cash requirements, other than normal operating expenses, are anticipated for the continued development of the Company's business plans. The Company will need to raise additional funds from investors in order to complete these business plans. If we need additional capital to fund our operations, there can be no assurance that such additional capital can be obtained or, if obtained, that it will be on terms acceptable to us. The incurring or assumption of additional indebtedness could result in the issuance of additional equity and/or debt which could have a dilutive effect on current shareholders and a significant impact on our operations. The Company is currently able to meet its financial obligations through debt financial support from Meridian Holdings, Inc., an affiliated Company. RESULTS OF OPERATIONS We have experienced, and expect to continue to experience, very low revenue from our current operation. 17 Furthermore, our quarterly revenues could be significantly affected based on how applicable accounting standards are amended or interpreted over time. Due to these and other factors, we believe that period-to-period comparisons of our results of operations are not meaningful and should not be relied upon as indicators of our future performance. It is possible that in some future periods our results of operations may be below the expectations of public market analysts and investors. If this occurs, the price of our common stock may decline. We will depend on the commercial success of our product suite, which has not yet been shipped. We have generated substantially all of our revenues from licenses and services related to current and prior versions of our product suite. REVENUES The company generated $124,400 revenue from the VVDC device rental during the quarter ended March 31, 2007, as compared to $1,250 during comparable period in 2006. There were no software license revenue generated during comparable periods in 2006 and 2007 respectively. COST OF REVENUES The company incurred $20,247, in costs of goods sold as compared to zero during The same period in last fiscal year. SALES AND MARKETING Only minimal sales and marketing has been done by the Company, since focusing most of its resources at the moment in our software enhancement, pilot testing and debugging of our ICE software. The Company is allocating a substantial amount of time and efforts towards sales and marketing of the IVDC device. To this end, the Company has entered into sales and marketing Agreement with various sales force. Management is also pursuing aggressively various medical device vendors and distributors to carrier our device in their inventory. PRODUCT DEVELOPMENT. The Company will continue to update and enhance both the VVDC device as well as ICE(tm)Software products with the result that there will be an anticipated increase in product research and development expenses during the next coming year. There can be no assurance that any new development or update to the IVDC devices will be approved for marketing by USFDA in a timely manner. In ability to obtain USFDA proved, or any delay in approval may impact our revenue stream. GENERAL AND ADMINISTRATIVE General and administrative expenses for the period ended March 31, 2007 was $ 145,997compared to $ 59,282 during comparable period in 2006. The increase in general and administrative expense was due to the increase in the management share of cost from Meridian Holdings, Inc and selling costs related to equipment sales. The Company anticipates future increases in general and administrative expenses as it embarks on aggressive product development, sales and marketing with its associated increase in personnel costs. OPERATING LOSS As a result of the factors described above, Company expects further increases in operating expenses for the year 2007, assuming additional funding is raised from equity investors to be used in financing future operating costs. There is no guarantee that the Company will be able to raise additional funds to finance all the anticipated operating costs. In absence of such funds being available, the Company may not be able to operate, and this could have a material impact in the overall execution of the Company's business plan. NET LOSS The Company had a net loss of $41,844 for the period ended March 31, 2007, compared to net loss of $58,032 in March 31, 2006. The decrease in net loss was as a result of the increase in sells of equipment and the decreased management share of cost for the period ended March 31, 2007. The Company anticipates future revenue increases, as it embarks upon aggressive commercialization of the IVDC device as well as sales of ICE(tm) software licenses, implementation and training. PLAN OF OPERATIONS The Company continues to increase its sales force for the purposes of sale And marketing of its software product and services, as well as the VVDC 18 Medical device. So far only minimal sales have been completed. We have entered into several product teaming agreements with various vendors and complementary technology companies. The Company recently entered into software licensing agreement with Microsoft Corporation, for the ConferenceXP technology to be integrated With ICE software for commercialization. There is no guarantee that such an effort will yield any dividend in the immediate or near future.. Item 3. Controls and Procedures Evaluation of Disclosure Controls and Procedures As required by Rule 13a-15 under the Securities Exchange Act of 1934, as amended (the "Exchange Act" ), the Company carried out an evaluation under the Supervision and with the participation of the Company's management, including the Chief Executive Officer and President and the Principal Financial Officer, of the effectiveness of the Company's disclosure controls and procedures as of March 31, 2007. In designing and evaluating the Company's disclosure controls and procedures, the Company and its management recognize that there are inherent limitations to the effectiveness of any system of disclosure controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures. Accordingly, even effective disclosure controls and procedures can only provide reasonable assurance of achieving their desired control objectives. Additionally, in evaluating and implementing possible controls and procedures, the Company's management was required to apply its reasonable judgment. Based upon the required evaluation, the Management concluded that as of March 31, 2007, the Company's disclosure controls and procedures were effective (at the "reasonable assurance" level mentioned above) to ensure that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms. From time to time, the Company and its management have conducted and will continue to conduct further reviews and, from time to time put in place additional documentation, of the Company's disclosure controls and procedures, as well as its internal control over financial reporting. The Company may from time to time make changes aimed at enhancing their effectiveness, as well as changes aimed at ensuring that the Company's systems evolve with, and meet the needs of, the Company's business. These changes may include changes necessary or desirable to address recommendations of the Company's management, its counsel and/or its independent auditors, including any recommendations of its independent auditors arising out of their audits and reviews of the Company's financial statements. These changes may include changes to the Company's own systems, as well as to the systems of businesses that the Company has acquired or that the Company may acquire in the future and will, if made, be intended to enhance the effectiveness of the Company's controls and procedures. The Company is also continually striving to improve its management and operational efficiency and the Company expects that its efforts in that regard will from time to time directly or indirectly affect the Company's disclosure controls and procedures, as well as the Company's internal control over financial reporting. Changes in Internal Control Over Financial Reporting There have been no significant changes in the Company's internal controls or in other factors that could significantly affect internal controls subsequent to the date of the evaluation. PART II - OTHER INFORMATION None ADDITIONAL INFORMATION Exhibits 31.1 Certification pursuant to section 302 of the Sarbanes-Oxley Act of 2002 32.1 Certification pursuant to section 906 of the Sarbanes-Oxley Act of 2002 SIGNATURES Pursuant to the requirements of Section 12 of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. 20 InterCare DX, Inc. Date: May 17, 2007 Signature By: /s/ Anthony C. Dike, MD ----------------------------- Anthony C. Dike, MD Chairman & CEO 20 EX-31 2 exhibit32.txt EXHIBIT 31 Exhibit 32.1 CERTIFICATION PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 In connection with the annual report of InterCare DX, Inc. (the "Company") on Form 10-QSB for the period ending March 31, 2007 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), we, Anthony C. Dike, the Chief Executive Officer, certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that: (1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to InterCare DX, Inc., and will be retained by InterCare DX, Inc., and furnished to the Securities and Exchange Commission or its staff upon request. DATE: May 17, 2007 By: /s/ Anthony C. Dike ------------------- Anthony C. Dike Chairman and CEO (Principal Executive and Financial Officer) EX-32 3 exhibit31.txt EXHIBIT 32 EXHIBIT 31.1 I, Anthony C. Dike, certify that: 1. I have reviewed this quarterly report on Form 10QSB of InterCare DX, Inc.; 2. Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report; 3. Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and we have: a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared; b) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this quarterly report based on such evaluation; and c) disclosed in this quarterly report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; 5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions): a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and 6. The registrant's other certifying officers and I have indicated in this annual report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. Date: May 17, 2007 By:_/s/ Anthony C. Dike - -------------------------- Anthony C. Dike Chairman and CEO (Principal Executive and Financial Officer) -----END PRIVACY-ENHANCED MESSAGE-----