UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 1-SA
☒ SEMIANNUAL REPORT PURSUANT TO REGULATION A or
☐ SPECIAL FINANCIAL REPORT PURSUANT TO REGULATION A
For the fiscal semiannual period ended June 30, 2022
| InterCare Dx, Inc. |
| (Exact name of issuer as specified in its charter) |
| California |
| 95-4304537 |
| State or other jurisdiction of incorporation or organization |
| (I.R.S. Employer Identification No.) |
20300 South Vermont Avenue Suite 215, Torrance California 90502
(Full mailing address of principal executive offices)
Telephone: (866) 767-4832/Fax (310) 693-8082
(Issuer’s telephone number, including area code)
| Management’s Discussion and Analysis of Financial Condition and Results of Operations |
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| Table of Contents |
Item 1. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Overview
InterCare Dx, Inc. was incorporated on January 31, 1991 and commenced operations immediately thereafter. The company is a USFDA registered biomedical and life sciences company with main office located at 20300 South Vermont Avenue, Suite 215, Torrance, California, USA. We strive to become a leader in designing and marketing of creative, technologically advanced Clinical Documentation software, Cardiovascular and Microwave products for medical applications. Build a reputation for delivering systems characterized by low price, compact size, and innovative features, with quality and reliability equal to that of competitors.
Financial Statements
Our unaudited financial statements, Balance sheet As of June 30, 2022, and December 31, 2021, and Statement of operations, statement of cash flow and statement of equity for the Six Months Ended June 30, 2022 and 2021 respectively are incorporated by reference.
Results of Operations
Statements of Operations (unaudited) for Six months Ended June 30, 2022, Compared to June 30, 2021.
Revenue
We generated no revenues during the Six Months ended June 30, 2022 and June 30, 2021.
Operating Expenses:
Total operating expenses for the six months ended June 30, 2022 increased to $346,774 from $274,283 compared to six months ended June 30, 2021. This increase is primarily attributable to increase in research and development cost, due to Covid 19 Pandemic, and the increase in purchase price of components, chipsets, and non-recurring engineering (NRE) cost, charged by our Engineering Consultants.
Net loss
As a result of the foregoing, during the period from January 1, 2022 through June 30, 2022, we recorded a net loss of $346,774. The loss is mainly comprised of compensation, research and development fees, and general and administrative expenses.
Liquidity and Capital Resources
Cash Flows
Operating Activities
From January 1 through June 30, 2022, we used $346,774 of cash in operating activities.
Financing Activities
From January 1 through June 30, 2021, financing activities provided $33,958. We received these proceeds largely from non-interest-bearing related party loans.
Liquidity
The Company has low cash balance. We are reimbursed for expenditures by related parties. We may be required to raise additional funds, particularly if we are unable to generate positive cash flow because of our operations. We estimate that based on current plans and assumptions, that our cash will not be sufficient to satisfy our cash requirements under our present operating expectations, without further financing, for up to 12 months. To continue as a going concern, develop a reliable source of revenues, and achieve a profitable level of operations the Company will need, among other things, additional capital resources. Management’s plans to continue as a going concern include raising additional capital through borrowings and the sale of common stock. No assurance can be given that any future financing will be available or, if available, that it will be on terms that are satisfactory to the Company. Even if the Company is able to obtain additional financing, it may contain undue restrictions on our operations, in the case of debt financing, or cause substantial dilution for our stockholders, in case of an equity financing.
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| Table of Contents |
Indebtedness
The Company has a business line of credit of $8,000 with Wells Fargo Bank, the available balance varies based on monthly recurring payments to the bank. The total amount owed as at this writing is $2,358.75.
Related Party Transactions
Related party loans and due to officer were $3,920,724 and $3,646,441 as of June 30, 2022 and 2021 respectively. The related party amounts borrowed were to fund the Company’s daily operations. The loans were evidenced through written agreements between the related parties. The loans are non-interest bearing with no maturity date, due on demand, and no covenants. The loans arose from an affiliated company and member of management.
Plan of Operations
The Company’s high-level objectives for the next 18 months are:
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| · | Conducting clinical trials beginning on October 1, 2021 thru September 30, 2022 for the “Cloud processing of hyperspectral skin images (HyperCloud)” research undertaking with University of Oulu, Finland for the SpectraCare™ Hyperspectral Camera, and file a 510K application with USFDA for a substantial equivalent with predicated Hyperspectral Camera currently approved by the USFDA. (Please see Item 2 below) |
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| · | Completing trials and assessing similarity and equivalence between Vasocor Model 300 and Vasocor Model 400. |
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| · | Submitting necessary applications to the USFDA to obtain approval to proceed with marketing of IVDC Model 400 based on the establishment of substantial equivalence to the already approved Vasocor Model 300. |
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| · | Market launch of Vasocor Model 400 and SpectraCare™ Hyperspectral Camera for wound care. |
PREPARATION FOR BETA LAUNCH, October 2022– December 2022
InterCare must undertake several activities in preparation for the beta launch. The first main activity is deciding the necessary bench studies and prioritizing among them. The reason for the bench study is to compare readings from Vasocor Model 300 with those of IVDC Model 400 to establish substantial equivalence of the two devices. For the SpectraCare™ hyperspectral Camera the aim is to establish a substantial equivalence with USFDA approved predicated Hyperspectral camera. At this juncture, InterCare will file a 510K pre-marketing approval with USFDA. It is anticipated that FDA approval will not be unnecessarily delayed (approximately 120 days).
The next critical set of activities deals with hiring senior management for the positions of Brand Manager, Medical Director, Sales Director and Marketing Director.
The last pre-Beta launch activity is identifying and approaching physicians for the scientific trials, relationship-building studies, and usage studies. The newly hired Medical Director will take the lead in this effort, supported by the sales reps and CRO.
BETA LAUNCH, January 2023-March 2023
The beta launch will be a very intensive time for InterCare because it must kick-start its pilot testing. As pilot testing will aim at introducing the new Vasocor Model 400 and SpectraCare™ Hyperspectral Camera into medical practices who are already using the Vasocor Model 300, to get their feedback regarding the new functionalities and ease of use of the Vasocor Model 400 as compared to its predecessor Vasocor Model 300.
Relationship-building and usage studies will be gradually rolled out to six sites (two sites per city). InterCare will hire one clinical rep and 2 PCP reps to run the first relationship study and will stagger the hiring of the remaining 2 clinical reps and 4 PCP reps according to the timing of the IVDC Model 400 roll-out in the Beta launch. InterCare is currently in discussions with candidates and executive search firms to accomplish these tasks.
Each study will be continued throughout the entire beta launch with variations in scope, structure, and interaction. InterCare believes that it is important to maintain a relationship with the target physicians until the full market launch, and hence the decision to leave the IVDC Model 400 with the physicians until January 2024. The rollout will begin in January 2023 with two sites. InterCare anticipates that considerable sales and marketing learning will occur during this rollout, both with respect to tactics and strategy. To take full benefit of the lessons learned and to maximize the usefulness from the remaining sites, the rollout to the next two sites is delayed to June 2023. A shorter learning period is needed for the rollout to the last two sites, which will start in August 2023.
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| Table of Contents |
InterCare will synchronize its hiring of sales reps to accommodate the lagged rollout.
Following analysis of the clinical data, InterCare's principal investigators must begin submitting articles to prominent peer-reviewed medical journals. An intensive publishing strategy is critical to raise physician awareness and to buttress regulatory applications for additional indication for Use of IVDC Model 400 and SpectraCare™ Hyperspectral camera medical devices.
MARKET LAUNCH PREPARATION, April 2023-August 2023
The activities in the market launch are split between those related to regulatory bodies and those related to beta launch results. On the regulatory front, InterCare will submit 510K application to the FDA to obtain approval to proceed with marketing IVDC Model 400 and the SpectraCare™ Hyperspectral camera, based on the establishment of substantial equivalence to the already approved Vasocor Model 300. The likelihood of this approval is contingent upon the strength and persuasiveness of the bench study. At this juncture, InterCare will also apply to the American Medical Association to receive a new CPT code. Again, the likelihood of approval depends on the caliber of the clinical data.
The second set of activities is tied to the sales and marketing information produced by the beta launch. Physician reaction during the beta roll-out to the six sites will give InterCare important data points regarding the relative success of its different sales and marketing techniques. On this basis, InterCare will modify its sales and marketing approach appropriately to reach physicians during the full launch. Additionally, the beta launch will also provide InterCare with useful information regarding the optimal sales rep/physician ratio, which InterCare will rely upon as it hires more sales reps in readiness for the mass market launch.
FULL MARKET LAUNCH, September 2023-December 2023
The full market launch across the United States will initially focus on adjunct to Coronary artery disease diagnostic applications and wound imaging devices. The rationale for this strategy is two-fold. First, physicians must see tangible evidence of the IVDC Model 400 value as an adjunct opportunity before gravitating towards it as a replacement opportunity, and same applies to SpectraCare™ Hyperspectral Camera.
Second, based on Vasocor Model 300 market research which indicates that Primary Care Physicians demand a technology capable of accurately diagnosing patients in the borderline population, thus positioning the IVDC Model 400 in this light will be a relatively easier sell.
The full market launch also requires InterCare to ensure that it is capable of manufacturing sufficient IVDC Model 400 device and SpectraCare™ hyperspectral Camera to meet the anticipated high demand. During the initial stages of the full launch, InterCare's sales force must work very closely with the manufacturer to ensure that IVDC Model 400 and SpectraCare™ devices reach physicians in a timely manner, and that the maintenance agreement is also upheld.
For the SpectraCare™ hyperspectral Camera, the full market launch across the United States will focus as an adjunct to Wound Care applications with the hope that it could become an imaging standard for evaluating chronic wound healing process.
OPPORTUNITY EXPANSION, January 2024-onwards
Once InterCare has significantly penetrated market share in the adjunct opportunities, it will expand its attention to the replacement and market creation markets. In the replacement market, InterCare will leverage the SpectraCare™ Hyperspectral Camera and the IVDC Model 400's reputation and track record as an adjunct to positively sway physicians to use the IVDC Model 400 as a replacement for Exercise Stress Tests. The success of such a campaign will rely heavily on InterCare's ability to have thought-leaders endorse this usage and disseminate their opinion in prominent medical forums.
The market creation will be targeted towards self-paying patients, will require a reorientation of the sales effort. While physician recommendation remains a critical influence in a patient's decision to pay for a diagnostic test, the patient's own self-awareness of the diagnostic also becomes an important factor. For this reason, InterCare will invest in direct-to-consumer advertising (e.g., ads in select popular magazines) which would be targeted towards patients fitting an appropriate profile.
InterCare intends to meet each of its milestones according to the timeline. The beta launch will take place in January 2023 and the full market launch will occur in January 2024.
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| Table of Contents |
On August 3, 2021, the Company entered into a research agreement with University of Oulu in Finland under a research project titled “Cloud processing of hyperspectral skin images (HyperCloud)”.
For the purposes of conducting the research, InterCare will deliver the software tools, documents, information, material, and equipment to the University of Oulu staff involved in the project.
In addition, InterCare will provide the following:
| 1. | An access to the cloud server to be used for data processing at Amazon Webservers Platform. |
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| 2. | MATLAB software Tools with Optimization Toolbox, Deep Learning Toolbox, and Parallel Computing Toolbox should be preinstalled in the server. |
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| 3. | InterCare will also provide access to the anonymized hyperspectral data for the verification of the data processing performance. |
The Research Project started on the October 01, 2021 and is expected to end on the September 30, 2022, unless mutually extended for another year.
Also, on June 29, 2021, the Company filed a Preliminary Offering Circular in the form of Form 1-A with SEC, to sell up to 2,000,000 shares of its common stock at five dollars ($5) per share. On July 9, 2021, the Company received a notification of qualification of the Offering Circular. As of August 21, 2021, no shares have been sold.
On August 27, 2021, InterCare released the Version 2.0 of ICE MedMaster™ and ICE Patient Portal™ Apps in both IOS and Android platforms. These two Apps enable patient and healthcare providers coordinate care, facilitate direct secure Video communication between the patient and their healthcare providers “Anyplace and Anywhere” there is internet Connectivity. These Apps are available for free download from Google Play store and Apple APP Store.
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| Table of Contents |
| 7 |
| Table of Contents |
Balance Sheets (unaudited)
As of June 30, 2022 and December 31, 2021
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| June 30, 2022 |
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| December 31, 2021 |
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| Assets |
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| Current Assets: |
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| Cash and cash equivalents |
| $ | 119 |
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| $ | 93 |
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| Total Current Assets |
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| 119 |
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| 93 |
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| Property and equipment, net of accumulated depreciation |
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| - |
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| - |
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| Total Assets |
| $ | 119 |
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| $ | 93 |
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| Liabilities and Shareholders’ Deficit | ||||||||
| Liabilities |
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| Current Liabilities: |
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| Related party loans |
| $ | 4,119,389 |
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| $ | 3,785,431 |
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| Accrued expense |
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| 18,407 |
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| 5,565 |
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| Due to officer |
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| 488,274 |
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| 488,274 |
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| Total Current Liabilities |
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| 4,626,070 |
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| 4,279,270 |
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| Total Liabilities |
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| 4,626,070 |
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| 4,279,270 |
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| Commitments and Contingencies (Note 6) |
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| Shareholders’ Deficit |
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| Preferred stock – no par value 20,000,000 authorized shares; 0 issued and 0 outstanding for June 30, 2022 and December 31, 2021 |
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| - |
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| - |
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| Common stock - no par value 100,000,000 authorized shares; 74,303,902 issued and outstanding for June 30, 2022 and December 31, 2021 |
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| - |
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| - |
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| Additional paid in capital |
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| 1,259,306 |
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| 1,259,306 |
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| Accumulated Deficit |
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| (5,885,257 | ) |
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| (5,538,483 | ) |
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| Total Shareholders’ Deficit |
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| (4,625,951 | ) |
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| (4,279,177 | ) |
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| Total Liabilities and Shareholders’ Deficit |
| $ | 119 |
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| $ | 93 |
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THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS
| F-1 |
| Table of Contents |
Statements of Operations (unaudited)
For the Six Months Ended June 30, 2022 and 2021
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| 2022 |
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| 2021 |
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| Revenues |
| $ | – |
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| $ | – |
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| Operating Expenses: |
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| Compensation |
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| 137,118 |
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| 142,573 |
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| General and administrative |
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| 44.174 |
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| 29,928 |
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| Consulting and management fees |
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| 24,815 |
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| 17,265 |
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| Rent |
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| 28,051 |
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| 26,517 |
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| Research and development |
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| 112,616 |
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| 58,000 |
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| Total operating expenses |
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| 346,774 |
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| 274,283 |
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| Net loss from operations |
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| (346,774 | ) |
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| (274,283 | ) |
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| Other income/(expense) |
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| Interest expense |
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| - |
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| - |
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| Net loss before provision for income taxes |
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| (346,774 | ) |
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| (274,283 | ) |
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| Provision for income taxes |
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| - |
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| - |
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| Net Loss |
| $ | (346,774 | ) |
| $ | (274,283 | ) |
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| Loss per share: |
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| Basic and Diluted |
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| (0.010 | ) |
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| (0.010 | ) |
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| Weighted Shares Outstanding: |
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| Basic and diluted |
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| 74,303,902 |
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| 74,303,902 |
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THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS
| F-2 |
| Table of Contents |
InterCare Dx, Inc.
Statements of Shareholders' Deficit (unaudited)
For the Six Months Ending June 30, 2022 and 2021
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| Common Stock |
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| Common Stock |
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| Additional Paid in |
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| Accumulated |
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| Total Shareholders' |
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| Shares |
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| No Par |
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| Capital |
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| Deficit |
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| Deficit |
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| JUNE 30, 2021 |
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| Balance on December 31, 2020 |
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| 74,303,902 |
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| - |
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| 1,259,306 |
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| (4,905,747 | ) |
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| (3,646,441 | ) |
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| Net Loss |
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| – |
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| - |
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| - |
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| (274,283 | ) |
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| (274,283 | ) |
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| Balance on June 30, 2021 |
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| 74,303,902 |
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| $ | - |
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| $ | 1,259,306 |
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| $ | (4,631,464 | ) |
| $ | (3,372,158 | ) |
| JUNE 30, 2022 |
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| Balance on December 31, 2021 |
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| 74,303,902 |
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| - |
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| 1,259,306 |
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| (5,538,482 | ) |
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| (4,279,176 | ) |
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| Net Loss |
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| - |
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| - |
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| - |
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| (346,774 | ) |
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| (346,774 | ) |
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| Balance on June 30, 2022 |
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| 74,303,902 |
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| $ | - |
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| $ | 1,259,306 |
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| $ | (5,885,256 | ) |
| $ | (4,625,950 | ) |
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS
| F-3 |
| Table of Contents |
InterCare Dx, Inc.
Statements of Cash Flows (unaudited)
For the Six Months Ended June 30, 2022 and 2021
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| 2022 |
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| 2021 |
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| Cash flows from operating activities: |
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| Net Loss |
| $ | (346,774 | ) |
| $ | (274,253 | ) |
| Changes in operating assets and liabilities |
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| Accrued expenses |
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| 12,842 |
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| 940 |
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| Net cash used in operating activities |
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| (333,958 | ) |
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| (270,986 | ) |
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| Cash flows from financing activities: |
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| Proceeds from related party loans |
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| (333,958 | ) |
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| (273,343 | ) |
| Officer proceeds |
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| - |
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| - |
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| Net cash provided by financing activities |
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| (333,958 | ) |
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| (273,343 | ) |
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| Net increase (decrease) in cash |
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| 26 |
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| Cash, beginning of period |
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| 93 |
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| Cash, end of period |
| $ | 119 |
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| $ | - |
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| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: |
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| Cash interest payments |
| $ | - |
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| $ | - |
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| Cash income tax payments |
| $ | - |
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| $ | - |
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THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS
| F-4 |
| Table of Contents |
InterCare Dx, Inc.
June 30, 2022
NOTE 1. ORGANIZATION AND NATURE OF OPERATIONS
Business description
The financial statements presented are those of InterCare DX, Inc. (the “Company”). The Company was incorporated on January 31, 1991 and commenced operations immediately thereafter. The company is a USFDA registered biomedical and life sciences company with main office located at 20300 South Vermont Avenue, Suite 215, Torrance, California, USA, and international partners located worldwide. We strive to become a leader in designing and marketing creative, technologically advanced Microwave products for medical applications. Build a reputation for delivering systems characterized by low price, compact size, and innovative features, with quality and reliability equal to that of competitors.
Nature of Operations
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™), which is designed to integrate every aspect of the healthcare enterprise as well as the Vasocor Vascular Diagnostic Centers device, which is a non-invasive cardiovascular diagnostic center. The company is currently in its development stage.
On August 3, 2021, the Company entered into a one-year research agreement with University of Oulu in Finland under a research project titled “Cloud processing of hyperspectral skin images (Hyper Cloud)”. The research projected started on October 1, 2021, will end on September 30, 2022 unless it is renewed for another year.
Also, June 29, 2021, the Company filed a Preliminary Offering Circular in the form of Form 1-A with SEC, to sale up to 2,000,000 shares of its common stock at five dollars ($5) per share. On July 9, 2021, the Company received a notification of qualification of the Offering Circular. As of August 3, 2022, no shares have been sold. (Please see item 2 above).
Basis of Presentation
The Company presents its financial statements in accordance with U.S. generally accepted accounting principles (GAAP) under the accrual basis of accounting.
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
Uses of estimates in the preparation of financial statements
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. Our most significant estimates are for stock-based compensation, assessment of impairment of our intangible asset, and valuation of our deferred tax valuation allowance. We evaluate our estimates on an ongoing basis. Actual results may differ from these estimates under different assumptions or conditions.
Accounting Period
The Company’s fiscal year ends on December 31 of each year.
Revenue recognition
On January 1, 2020, the Company adopted Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers (“new revenue standard”) to all contracts using the modified retrospective method. The adoption of the new revenue standard had no material impact on our consolidated financial statements as it did not require a change in revenue recognition. As such, comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods.
Revenue is recognized based on the following five-step model:
| F-5 |
| Table of Contents |
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| · | Identification of the contract with a customer |
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| · | Identification of the performance obligations in the contract |
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| · | Determination of the transaction price |
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| · | Allocation of the transaction price to the performance obligations in the contract |
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| · | Recognition of revenue when, or as, the Company satisfies a performance obligation |
Since there were no revenues, the Company does not have material contract assets or liabilities that fall under the scope of ASC 606.
Cash and Cash Equivalents
All highly liquid investments purchased with an initial maturity of three months or less are considered to be cash equivalents.
Property and Equipment
Property and equipment are stated at cost. Depreciation is computed primarily using the straight-line method over the estimated useful lives of the assets, which range from 5 to 7 years. Expenditures for repairs and maintenance are charged to expense as incurred. For assets sold or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts, and any related gain or loss is reflected in income for the period.
Advertising Costs
Advertising costs are expensed as incurred. The Company recorded advertising costs for the six months ending June 30, 2022 and 2021 in the amounts of $0 and $0, respectively.
Fair Value of Financial Instruments
The Company’s balance sheet includes the following financial instruments: cash, accrued expenses due to officer payables and related party loans. The carrying amounts of current assets and current liabilities approximate their fair value because of the relatively short period of time between the origination of these instruments and their expected realization. The carrying values of the related party loans and due to officer approximates fair value based on the borrowing rates currently available to the Company for instruments with similar terms and remaining maturities.
FASB Accounting Standards Codification (ASC) topic 820 “Fair Value Measurements and Disclosures”, defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below:
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| · | LEVEL 1 - Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. |
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| · | LEVEL 2 - Include other inputs that are directly or indirectly observable in the marketplace |
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| · | LEVEL 3 - Unobservable inputs which are supported by little or no market activity. |
As of June 30, 2022, and December 31, 2021, there were no financial instruments that required fair value measurement.
Concentration of Credit Risk
Management believes that it has minimal credit risk at June 30, 2022 and December 31, 2021.
Research and Development
Research and development expenses consist primarily of personnel-related expenses, consulting and contractor expenses and tooling and medical materials. Substantially all the Company’s research and development expenses are related to developing new products and services. Research and development costs are expensed as incurred. The Company incurred $58,000 and $49,000 of research and development costs for the six months ended June 30, 2022 and 2021, respectively.
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Income Taxes
Income taxes are determined in accordance with ASC Topic 740, “Income Taxes” (“ASC 740”). Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Any effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.
ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts.
Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to be applied to taxable income in the years in which those temporary differences are expected to reverse. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the statement of income in the period that includes the enactment date. A valuation allowance is provided for deferred tax assets if it is more likely than not these items will either expire before the Company is able to realize their benefits, or that future deductibility is uncertain.
For the periods ending June 30, 2022, and 2021, the Company did not have any interest and penalties associated with tax positions. As of June 30, 2022, and December 31, 2021, the Company did not have any significant unrecognized uncertain tax positions. The Company is subject to taxation in the United States and various states. As of June 30, 2022, tax years for 2018, 2019, and 2020 are subject to examination by the tax authorities.
Loss per Share
The Company reports earnings (loss) per share in accordance with FASB Accounting Standards Codification 260 “Earnings per Share” (“ASC 260”). This statement requires dual presentation of basic and diluted earnings (loss) with a reconciliation of the numerator and denominator of the earnings (loss) per share computations. Basic net income (loss) per share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period. If applicable, diluted earnings per share assume the conversion, exercise or issuance of all common stock instruments such as options, warrants and convertible securities, unless the effect is to reduce a loss or increase earnings per share. Therefore, no diluted loss per share figure is presented. There were no adjustments required to net loss for the periods presented in the computation of basic loss per share. The Company has not issued any options since inception.
Segment Reporting
The Company operates as one segment based upon the Company’s organizational structure, the way in which the operations are managed and evaluated, the availability of separate financial results and materiality considerations.
NOTE 3. GOING CONCERN
The Company’s financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The Company had a net loss of $348,383 and net cash used in operating activities of $273,343 for the six months ending June 30, 2022. The Company has a working capital deficit of $3,920,724 and an accumulated deficit of $5,180,030 at June 30, 2022. These conditions raise substantial doubt about the Company’s ability to continue as a going concern for a period of at least twelve months after the date of issuance on these financial statements. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
The Company has a minimum cash balance available for payment of ongoing operating expense, has incurred losses from operations since inception, and it does not have a source of revenue sufficient to cover its operating costs. Its continued existence is dependent upon its ability to execute its operating plan and to obtain additional debt or equity financing. There can be no assurance the necessary debt or equity financing will be available or will be available on terms acceptable to the Company. These factors raise substantial doubt about the Company’s ability to continue as a going concern.
The financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or amounts and classifications of liabilities that may result from the possible inability of the Company to continue as a going concern.
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NOTE 4. RECENTLY ISSUED PRONOUNCEMENTS
We have reviewed all FASB issued Accounting Standards Update (“ASU”) accounting pronouncements and interpretations thereof that have effectiveness dates during the periods reported and in future periods. The Company has carefully considered the new pronouncements that alter previous generally accepted accounting principles and does not believe that any new or modified principles will have a material impact on the corporation’s reported financial position or operations in the near term. The applicability of any standard is subject to the formal review of our financial management and certain standards are under consideration.
Management does not believe that any recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying financial statements.
NOTE 5. RELATED PARTIES
Related party loans and due to officer were $34,119,989 and $3,785,431[VF15] as of June 30, 2022, and December 31, 2021 respectively. The related party amounts borrowed were to fund the Company’s daily operations. The loans were evidenced through written agreements between the related parties. The loans are non-interest bearing with no maturity date, due on demand, and no covenants. The loans arose from an affiliated company and member of management.
NOTE 6. SHAREHOLDERS’ DEFICIT
We have two classes of authorized common stock, Common and Class B common. The rights of the holders of Common and Class B Common are identical, except with respect to voting and conversion. Each share of Class B Common stock is entitled to 10 votes per share. Each share of Common stock is entitled to one vote per share. Upon transfer, each share of Class B Common Stock is automatically converted shares of Common stock. As at June 30, 2022 and December 31, 2021, the Company has 350,000,000 Common Stock and 100,000,000 Class B Common Stock authorized, with no par value. As at June 30, 2022 and December 31, 2021, the Company had 74,303,902 shares of Common Stock issued and outstanding.
The Company is authorized to issue 50,000,000 shares of preferred stock but as of June 30, 2022, and December 31, 2021, the Company has no preferred stock issued or outstanding.
NOTE 7. COMMITMENTS AND CONTINGENCIES
Litigation
The Company’s operations are subject to significant risks and uncertainties including financial, operational, and regulating risks, including the potential risks of business failure.
From time to time the Company may be a party to litigation matters involving claims against the Company. Management believes there are no known or potential matters that would have a material effect on the Company’s financial position or results of operations other than listed below.
Leases
The Company has one rental agreement with Meridian, a related party, for which it shares the cost of its rented space. The lease is short term in nature. The Company is not obligated to pay future rental payments under the leasing agreement on a month-to-month basis. The Company incurred $28,051 and $26,517 of rent expense in the six months ending June 30, 2022, and 2021.
NOTE 8. SUBSEQUENT EVENTS
The Company has evaluated subsequent events for recognition and disclosure as of August 3rd 2022 which is the date the financial statements were available to be issued. No other matters were identified affecting the accompanying financial statements and related disclosures.
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SIGNATURES
Pursuant to the requirements of Regulation A, the issuer has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
(Exact name of issuer as specified in its charter) : InterCare Dx, Inc.
| By: | /s/Anthony C. Dike, MD | |
| Name: | Anthony C. Dike, MD | |
| Title : | Chief Executive Officer and Director | |
| (Principal Executive Officer, Principal Accounting Officer) |
Date: August 3, 2022
Pursuant to the requirements of Regulation A, this report has been signed below by the following persons on behalf of the issuer and in the capacities and on the dates indicated.
By: Anthony C. Dike, MD (Signature and Title) /s/ Anthony C. Dike, MD Chairman/CEO/Director
Date: August 3, 2022
By: Stanley I Maduike, MSc (Signature and Title). /s/ Stanley I Maduike COO/Director
Date: August 3, 2022
By: Emeka M. Eziri, MD (Signature and Title) /s/ Emeka M. Eziri, MD Director
Date: August 3, 2022
By: Francis Sido, MD (Signature and Title) /s/ Francis Sido, MD Directo
Date: August 3, 2022
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