10-Q 1 lhc-10q.htm QUARTERLY REPORT lhc-10q.htm

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.  20549
 
FORM 10-Q
 
 
x
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the quarterly period ended June 30, 2009
 
OR
 
 
o
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 0-53327
 
LIFEHEALTHCARE, INC.
(Exact name of Registrant as Specified in Its Charter)

Delaware
68-0652656
(State or Other Jurisdiction of Incorporation or Organization)
(IRS Employer Identification No.)

 
137 Rowayton Avenue Suite 110 Rowayton CT 06853
(Address of Principal Executive Offices with Zip Code)
 
Registrant’s Telephone Number, Including Area Code: (203) 866-1015
 
N/A
Former Name, Former Address and Former 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 Security Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes  x  No  o
 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes  o  No  x
 
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS
 
Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.
Yes  o  No  o
 
APPLICABLE ONLY TO CORPORATE ISSUERS:
 
Indicate the number of shares outstanding of each of the issuer's classes of common stock as of August 10, 2009 was 28,449,265.

Transitional Small Business Disclosure Format (Check one):  Yes  x  No  o
 
 

 
 
 


LIFEHEALTHCARE, INC.

(A Development Stage Corporation)

INDEX


PART I – FINANCIAL INFORMATION
   
   
 
   
 
   
 
   
   
   
   
PART II – OTHER INFORMATION
 
   
   
   
   
   
   
 


 
 
 
 
 
PART I - FINANCIAL INFORMATION


LIFEHEALTHCARE, INC
(A Development Stage Company)
CONDENSED BALANCE SHEETS
 
     
June 30, 2009
    
September 30, 2008
  
     
(unaudited)
        
ASSETS
              
Current Assets
              
Prepaid Directors Fees
     $ 27,200     $ 108,800  
Total Current Assets
       27,200       108,800  
                   
Other Assets
                  
Deposit
       2,200       2,200  
Investment
       0       100,000  
Intangible Asset
       11,730       11,730  
Total Assets
     $ 41,130     $ 222,730  
                   
LIABILITIES AND STOCKHOLDERS’ EQUITY/(DEFICIENCY)
                  
Current Liabilities
                  
Accrued Expenses
     $ 76,039     $ 26,975  
Due to Shareholders
       119,329       81,780  
Total Current Liabilities
       195,368       108,755  
Total Liabilities
       195,368       108,755  
Commitments
                  
                   
Stockholders’ Equity/(Deficiency)
                  
Capital stock:
                  
Preferred Stock, $.001 par value 1,000,000 shares authorized and
                  
no shares issued
                  
Common Stock, $0.001 par value; 50,000,000
                  
shares authorized; 23,816,070 and 24,487,265 shares
                  
issued and outstanding
       28,749       24,487  
Additional Paid-in Capital
       1,644,931       1,460,713  
Accumulated Deficit
 
     (1,827,918 )     (1,371,225 )
Total Stockholders’ Equity/(Deficiency)
 
     (154,238 )     113,975  
Total Liabilities and Stockholders’ Equity/(Deficiency)
 
   $ 41,130     $ 222,730  
 
The accompanying notes are an integral part of the condensed financial statements.
 

 
 
 

LIFEHEALTHCARE, INC
(A Development Stage Company)
CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)
 
                           
Development period
  
   
Three Months Ended
    
Nine Months ended
    
(Inception to June 30, 2009
  
   
June 30,
    
June 30,
        
   
2009
    
2008
    
2009
    
2008
        
                               
Revenues
   $ 0     $ 0     $ 0     $ 0     $ 0  
Amortization      0        0        0        0        22,500  
Directors fees
     54,400        0       81,600        0       81,600  
Professional expenses
     31,419       5,000       210,442       9,263       258,278  
Impairment losses
     100,000       77,500       100,000       77,500       1,346,699  
General and administrative expenses
     26,937       5,000       64,651       7,500       118,841  
                                         
Loss from operations
     (212,756 )     (85,000 )     (456,693 )     (94,263 )     (1,827,918 )
                                         
Provision for income taxes
     0       0       0       0       0  
Net loss
   $ (212,756 )   $ (85,000 )   $ (456,693 )   $ (94,263 )   $ (1,827,918 )
                                         
Loss per share:
                                        
Basic and Fully Diluted
   $ (0.01 )   $ (0.01 )   $ (0.02 )   $ (0.00 )        
                                         
Weighted average common stock outstanding:
                                        
Basic and Fully Diluted
     28,515,199       13,480,082       27,654,166       11,149,831          
 
The accompanying notes are an integral part of the condensed financial statements.

 
 
 

LIFEHEALTHCARE, INC
(A Development Stage Company)
CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
 
               
Development period
  
   
Nine Months Ended June 30,
    
(Inception to June 30, 2009
  
   
2009
     2008        
Cash flow from operating activities:
                  
Net loss
   $ (456,693 )   $ (94,263 )   $ (1,827,918 )
Adjustments to reconcile net loss to net cash
                        
used in operating activities:
                        
Shares issued for services
     188,480               264,880  
Impairment loss
     100,000       77,500       1,346,699  
Amortization expense
     0       7,500       22,500  
Directors Fees     81,600       0       81,600  
                         
Change in assets and liabilities, net of acquisition
                        
Decrease and other assets     0       0       10,639  
                         
Increase in patent related expenditures
     0       0       (5,000 )
Increase/(decrease) in accrued liabilities
     49,064       9,263       (10,529 ) 
Net cash used in operating activities
     (37,549 )     0       (117,129 )
                         
Cash flows from financing activities:
                        
        Payment of deposit
                     (2,200 )
Proceeds from shareholder
     37,549               119,329  
Net cash provided by financing activities
     37,549       -       117,129  
                         
Net decrease in cash and cash equivalents
     0       0       0  
                         
Cash and cash equivalents, beginning of period
     0       0       0  
Cash and cash equivalents, end of period
   $ -     $ -     $ -  
                         
Supplemental disclosure of cash flow information
                        
Cash paid for income tax
   $ -     $ -     $ -  
Cash paid for interest
   $ -     $ -     $ -  
 
The accompanying notes are an integral part of the condensed financial statements.

 
 
 
 
LIFEHEALTHCARE, INC
(A Development Stage Company)
CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
 
 
               
Development period
  
   
Nine Months Ended June 30,
    
(Inception to June 30, 2009
  
   
2009
     2008        
Non-Cash investing & financing
                  
Acquisition of Goodwill
   $ 0     $  0     $ 1,169,199  
Acquisition of Patent
     0       0       6,730  
Acquisition of Other Assets
     0        0       10,639  
Acquisition of Intellectual Property
     0        0       100,000  
Acquisition of Liabilities
     0       0       (86,568 )
Acquisition of Patent Rights
     0       100,000       100,000  
Issuance of Stock for Directors Fees     0       0       108,800  
 
 
 
 
 
 
 
 
 


LIFEHEALTHCARE, INC.

(A Development Stage Corporation)

(UNAUDITED)


1.           FINANCIAL INFORMATION
 
LifeHealthCare, Inc. is a Delaware company (the “Company”) that was acquired and then recently divested from Market & Research Corp. ("Market") (formerly known as Cable & Co. Worldwide, Inc., a Delaware corporation), in connection with a spin-off by Market & Research Corp. that became effective September 12, 2008.  The Company is a development stage company that focuses on providing products in the dental and healthcare marketplaces and is currently seeking financing to market its products and to develop additional healthcare products.  The Company, which was formed in 2002, has not operated since it was incorporated.

The Market & Research Corp. distributed (“spun off”) the stock of LifeHealthCare, Inc. (“LHC”) to its shareholders in September 2008.  Market included the operations of LHC through the date of the spinoff (September 12, 2008) in its operations.  Market valued LHC at zero, and as a result, wrote off its investment of $1,200,000 in LHC.  The net liabilities that were spun off totaled $9,926.

2.           BASIS OF PREPARATION

The unaudited financial statements include all the accounts of the Company.

CONDENSED PRESENTATION
Pursuant to the rules and regulations of the Securities and Exchange Commission for Form 10-Q, the financial statements, footnote disclosures and other information normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed. The financial statements contained in this report are unaudited but, in the opinion of the Company, reflect all adjustments, consisting of only normal recurring adjustments necessary to fairly present the financial position as June 30, 2009 and the results of operations and cash flows for the interim periods of the fiscal year ending September 30, 2009 ("fiscal 2009") and the fiscal year ended September 30, 2008 ("fiscal 2008") presented herein. The results of operations for any interim period are not necessarily indicative of results for the full year.  These unaudited condensed financial statements should be read in conjunction with the audited financial statements and related notes included in the Lifehealthcare, Inc. Annual Report for the year ended September 30, 2008 on Form 10-K.

DEVELOPMENT STAGE
The Company is in the development stage. Since its formation the Company has not realized any revenues from its planned operations. The Company intends to design, manufacture and market dental accessories. The Company's primary activities since incorporation have been conducting research and development, performing business, strategic and financial planning, and raising capital.

GOING CONCERN
The financial statements have been prepared using accounting principles generally accepted in the United States of America applicable for a going concern which assumes that the Company will realize its assets and discharge its liabilities in the ordinary course of business. As of June 30, 2009, the Company had no established source of revenues and has accumulated losses of approximately $1,830,000 since its inception. Its ability to continue as a going concern is dependent upon achieving production or sale of goods, the ability of the Company to obtain the necessary financing to meet its obligations and pay its liabilities arising from normal business operations when they come due and upon profitable operations. The outcome of these matters cannot be predicted with any certainty at this time and raises substantial doubt that the Company will be able to continue as a going concern. These unaudited consolidated financial statements do not include any adjustments to the amounts and classification of assets and liabilities that may be necessary should the Company be unable to continue as a going concern.
 
SUBSEQUENT EVENTS
 
In May 2009, FASB issued statement of Financial Accounting Standards No. 165, Subsequent Events.  This new standard applies to interim and annual financial periods ending after June 15, 2009.  This statement establishes principles setting forth the period after the balance sheet date during which management shall evaluate events and transactions that may occur for potential recognition or disclosure in the financial statements.  For the purposes of this accounting standard, the Company has evaluated subsequent events through August 18, 2009.
 
NEW ACCOUNTING PRONOUNCEMENTS
 
In June 2009, the FASB issued FAS 168, "The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles-a replacement of FASB Statement No. 162" ("FAS 168"). FAS 168 establishes the FASB Accounting Standards Codification as the sole source of authoritative GAAP. Pursuant to the provisions of FAS 168, we will update our references to GAAP in our consolidated financial statements issued for the period ended September 30, 2009 and thereafter. The adoption of FAS 168 will have no impact on our financial position or results of operations.
 
In June 2009, the FASB issued FAS 167, "Amendments to FASB Interpretation No. 46(R)" ("FAS 167"). FAS 167 is effective for interim and annual reporting periods ending after November 15, 2009. FAS 167 amends certain guidance in FIN 46(R) to eliminate the exemption for special purpose entities, require a new qualitative approach for determining who should consolidate a variable interest entity and change the requirement for when to reassess who should consolidate a variable interest entity. We plan to adopt FAS 167 effective January 1, 2010, and we do not expect it to have any impact on our financial position or results of operations.

 
 
 
 
In June 2009, the FASB issued FAS 166 "Accounting for Transfers of Financial Assets - an amendment of FAS Statement No. 140" ("FAS 166"). FAS 166 is effective for interim and annual reporting periods ending after November 15, 2009 and must be applied to transfers occurring on or after the effective date. FAS 166 clarifies that the objective of paragraph 9 of Statement 140 is to determine whether a transferor and all of the entities included in the transferor's financial statements being presented have surrendered control over transferred financial assets. We plan to adopt FAS 166 effective January 1, 2010, and we do not expect it to have a material impact on our financial position or results of operations.

Reclassifications
Certain amounts from prior periods have been reclassified to conform to the 2009 presentation.  Such reclasses had no impact on total assets nor net loss.

3.           NET LOSS PER SHARE

NET LOSS PER SHARE
Basic net income or loss per share is computed by dividing net income or loss by the weighted average number of common shares outstanding. Fully diluted net income or loss per share is computed by dividing net income or loss by the weighted average number of common shares outstanding and dilutive potential common shares reflecting the dilutive effect of stock options and warrants.  Dilutive potential common shares, stock options and warrants for all periods presented are computed utilizing the treasury stock method.  The Company had no outstanding options or warrants at June 30, 2009 and 2008.

4.           STOCK-BASED COMPENSATION

In December 2004, the FASB issued SFAS No. 123R, “Share-Based Payment.”  This standard replaces SFAS No. 123, “Accounting for Stock-Based Compensation” and supersedes Accounting Principles Board (‘PB’) Opinion No. 25, “Accounting for Stock Issued to Employees.”  The standard requires companies to expense the fair value of stock option on the grant date and is effective for annual periods beginning after June 15, 2005.  In accordance with the revised statement, the expense attributable to stock options granted or vested subsequent to July 1, 2005, was required to be recognized by the Company. During the nine months ended June 30, 2009 the Company issued 4,262,000 common shares to consultants for services rendered in fiscal 2009.  The value of the shares issued was determined by the estimated value of the services rendered.

5.           RELATED PARTY TRANSACTIONS

At June 30, 2009 and December 31, 2008, the Company owed $119,329 and $81,780, respectively, to Martin Licht (Executive Vice President and Chairman) for expenses paid by him on behalf of the Company.  This amount is non-interest bearing, unsecured, and due on demand; however the officer has agreed not to demand payments for one year.

6.           INTANGIBLE ASSETS

The components of intangible assets as of June 30, 2009, and September 30, 2008, are as follows:

Patent Cost
  
$
11,730
  
Total Net Carrying Amount
  
$
11,730
  

Intangible assets with a definite life are amortized over their legal or estimated useful lives, whichever is shorter. The Company reviews the carrying amounts of intangible assets with a definite life whenever events or changes in circumstance indicate that the carrying amount of an asset may not be recoverable. Such events or circumstances might include changes in technology, significant litigation or other items.  These costs are related to the application for a patent.  At the point of the final determination of the patent, the amounts will either begin to be amortized or written off.

7.           ACQUISITION

On March 28, 2006, Market acquired LifeHealth Care, Inc. (“LHC”) from Martin Licht, a director and officer of the Market & Research Corp.  Market & Research Corp. issued 600,000,000 shares of Common Stock to Martin Licht to acquire LHC at $.002 per share.

The purchase price was allocated on the basis of the estimated fair values of the assets acquired and liabilities assumed which was $1,200,000.  LHC has a product (an emergency dental kit) that is approved for sale in the European Union.  The life of this asset is indeterminable since the approval has no pre set lifespan.  The acquisition was accounted for as a purchase.

Acquisition cost
  
$
1,200,000
  
         
Net assets acquired:
        
Current assets
  
$
10,639
  
Goodwill
    
1,169,199
  
Intellectual property
    
100,000
  
Patent
    
6,730
  
         
Total assets
    
117,369
  
         
Liabilities assumed
    
(86,568
)
         
Total liabilities
    
(86,568
)
         
Amount assigned to goodwill
  
$
1,169,199
  
 
 
 
 
 
 
 
LHC has no revenues or tangible assets and will require a significant amount of financing in order to commence operations.  The Company does not have access to the necessary financing at this time.  If financing is not obtained, LHC will not be able to commence operations.  As of the date of acquisition, LHC had incurred cumulative losses of approximately $71,000.  There is no certainty that even with adequate financing, LHC will be able to commence operations or obtain profitable status.

In accordance with Statement of Financial Accounting Standards (“SFAS”) No. 142, Goodwill and Other Intangible Assets (“SFAS No. 142”), the Company evaluates goodwill and intangible assets at least annually for impairment by analyzing the estimated fair value based on the present value of discounted cash flows compared to the net book value. The Company will write off the amount of any goodwill or intangible in excess of its fair value.  Management reviewed the goodwill at September 30, 2007 and determined that it was fully impaired and consequently wrote off the entire balance of $1,169,199.  Management reviewed the CE Designation Cost intangible asset at June 30, 2008 and determined that it was fully impaired and consequently wrote off the entire balance of $77,500.

Intangible assets with a definite life are amortized over their legal or estimated useful lives, whichever is shorter. The Company reviews the carrying amounts of intangible assets with a definite life whenever events or changes in circumstance indicate that the carrying amount of an asset may not be recoverable. Such events or circumstances might include changes in technology, significant litigation or other items.

Intellectual property will be amortized over the estimated useful life of ten years.

8.           TAXES

Effective October 1, 2007, the Company adopted the provisions of FASB Interpretation No. 48 (“FIN 48”), “Accounting for Uncertainty in Income Taxes — An Interpretation of FASB Statement No. 109.” FIN 48 provides detailed guidance for the financial statement recognition, measurement and disclosure of uncertain tax positions recognized in the financial statements in accordance with SFAS No. 109. Tax positions must meet a “more-likely-than-not” recognition threshold at the effective date to be recognized upon the adoption of FIN 48 and in subsequent periods. Upon the adoption of FIN 48, the Company had no unrecognized tax benefits. During the three months ended December 31, 2008, the Company recognized no adjustments for uncertain tax benefits.

The Company recognizes interest and penalties, if any, related to uncertain tax positions in selling, general and administrative expenses.  No interest and penalties related to uncertain tax positions were accrued at June 30, 2009.

Income taxes are computed using the asset and liability method of accounting. Under the asset and liability method, a deferred tax asset or liability is recognized for estimated future tax effects attributable to temporary differences and carryforwards. The measurement of deferred income tax assets is adjusted by a valuation allowance, if necessary, to recognize future tax benefits only to the extent, based on available evidence; it is more likely than not such benefits will be realized. The Company’s deferred tax assets were fully reserved at June 30, 2009.

The tax years 2003 through 2008 remain open to examination by the major taxing jurisdictions in which the Company operates. The Company expects no material changes to unrecognized tax positions within the next twelve months.

The Company has net operating loss carryforwards of approximately $455,000 available to offset taxable income through the year 2028.

The Company recorded a deferred income tax asset for the tax effect of net operating loss carryforwards and temporary differences, aggregating approximately $155,000. In recognition of the uncertainty regarding the ultimate amount of income tax benefits to be derived, the Company has recorded a valuation allowance of $155,000 at June 30, 2009.

9.           COMMITMENTS, CONTINGENCIES AND OTHER MATTERS

The Company has contracted with New York University School of Dentistry to perform tests of the Company’s personal dental care lozenge product in a double blind study.  The estimated total cost of the study is $135,000.  The work on the study has not yet commenced and has temporarily been put on hold.

From inception through the spin off date, the Company has been housed in a related corporation’s (Market & Research Corp.) offices at no charge due to the inactivity of the subsidiary.  Subsequent to the spin off date, the Company has shared office space with Market & Research Corp. at a cost of $3,500 per month.

10.           INVESTMENT

In September 2008 the Company issued 1,187,861 common shares for an interest in a patent owned by Henryk Jakubowski, a director and officer of the Company for the lozenges. Mr. Jakubowski retained 100% of ownership in the patent.

 
 
 
 
The Company has begun taking steps to unwind its relationship with Mr. Jakubowski.  As a result, the Company has written off its entire investment in the patent during the quarter ended June 30, 2009.  Mr. Jakubowski no longer serves as officer or director of the Company.  The Company does not know what impact these proceedings will have on the future of the Company.  It is management’s opinion that Mr. Jakubowski will dispute the Company’s right to unwind the Company’s transactions with him and may take legal action.  If a consensual agreement can not be reached, the Company may be drawn into such a litigation, the outcome of which can not be predicted.


The following discussion should be read in conjunction with the Financial Statements included in this report and is qualified in its entirety by the foregoing.

Forward-Looking Statements

This report contains “forward-looking statements”, which involve known and unknown risks, uncertainties and other factors which could cause actual financial or operating results, performances or achievements expressed or implied by such forward-looking statements not to occur or be realized.  These forward-looking statements generally are based on our best estimates of future results, performances or achievements, based upon current conditions and assumptions. Forward-looking statements may be identified by the use of forward-looking terminology such as “may,” “can,” “could,” “project,” “expect,” “believe,” “plan,” “predict,” “estimate,” “anticipate,” “intend,” “continue,” “potential,” “would,” “should,” “aim,” “opportunity” or similar terms, variations of those terms or the negative of those terms or other variations of those terms or comparable words or expressions. These risks and uncertainties include, but are not limited to:

 
Ÿ
general economic conditions in both foreign and domestic markets,

 
Ÿ
cyclical factors affecting our industry,

 
Ÿ
lack of growth in our industry,

 
Ÿ
our ability to comply with government regulations,

 
Ÿ
a failure to manage our business effectively and profitably,

 
Ÿ
our ability to sell both new and existing products and services at profitable yet competitive prices, and

 
Ÿ
other risks and uncertainties set forth from time to time in our filings with the Securities and Exchange Commission.

You should carefully consider these risks, uncertainties and other information, disclosures and discussions which contain cautionary statements identifying important factors that could cause actual results to differ materially from those provided in the forward-looking statements.  LifeHealthCare, Inc. undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Overview

LifeHealthCare, Inc. is a Delaware company that was acquired and then recently divested from Market & Research Corp. ("Market") (formerly known as Cable & Co. Worldwide, Inc., a Delaware corporation), in connection with a spin-off by Market & Research Corp. that became effective September 12, 2008.  The Company is a development stage company that focuses on providing products in the dental and healthcare marketplaces and is currently seeking financing to market its products and to develop additional healthcare products.

Recent Events

None

Results of Operations

Quarter ended June 30, 2009 as compared to quarter ended June 30, 2008

REVENUES

None.

DIRECTORS FEES

The Company recognized $54,400 during fiscal 2009 and $0 during fiscal 2008 in directors fees primarily related to amortization of a stock grant for 2009 granted in fiscal 2008.

PROFESSIONAL EXPENSES

The Company recognized $31,419 during fiscal 2009 and $5,000 during fiscal 2008 in professional fees.  The increase is primarily related to efforts to develop the Company’s website in fiscal 2009.

 
 
 
 
IMPAIRMENT LOSS

The Company recognized $100,000 during fiscal 2009 and $77,500 during fiscal 2008 in impairment losses.  The increase is primarily related to efforts to write off the investment in Mr. Jakubowski’s organization in fiscal 2009.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

The Company recognized $26,937 during fiscal 2009 and $5,000 during fiscal 2008 in professional fees and administrative expenses primarily related to efforts to locate financing and initiate operations the Company in fiscal 2009.

PROVISION FOR INCOME TAXES

The deferred tax asset generated by the tax losses and temporary differences has been fully reserved.

NET LOSS

The Company recognized net losses of $212,756 during the third quarter of fiscal 2009 as compared to $85,000 during the same period last year for an overall increase in net loss of $127,756. The increase in Company losses were primarily to locate financing and start the Company

Nine months ended June 30, 2009 as compared to nine months ended June 30, 2008

REVENUES

None.

DIRECTORS FEES

The Company recognized $81,600 during fiscal 2009 and $0 during fiscal 2008 in directors fees primarily related to amortization of a stock grant for 2009 granted in fiscal 2008.

PROFESSIONAL EXPENSES

The Company recognized $210,442 during fiscal 2009 and $9,263 during fiscal 2008 in professional fees.  The increase is primarily related to efforts to develop the Company’s website, to locate financing and initiate operations of the Company in fiscal 2009.

IMPAIRMENT LOSS

The Company recognized $100,000 during fiscal 2009 and $77,500 during fiscal 2008 in impairment losses.  The increase is primarily related to efforts to write off the investment in Mr. Jakubowski’s organization in fiscal 2009.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

The Company recognized $64,651 in administrative expenses in fiscal 2009.  The expenses during the comparable period the prior year of $7,500. The increase in the expense was due to efforts to locate financing and initiate operations the Company in fiscal year 2009.

PROVISION FOR INCOME TAXES

The deferred tax asset generated by the tax losses and temporary differences has been fully reserved.

NET LOSS
The Company recognized net losses of $456,693, during the first nine months of fiscal 2008 as compared to $94,263 during the same period the prior fiscal year for an overall increase in net loss of $362,430. The increase in the loss was due to the professional fees paid for with stock issuance, and efforts to locate financing and initiate operations the Company in fiscal year 2009.
 
Financial Condition, Liquidity and Capital Resources

The Company intends to seek financing to commence operations in the near future.  There can not be any assurance that the Company will be able to secure any such financing.

The Company has negative working capital.  Until it secures financing, it is unlikely that the Company will have any working capital.  The Company’s cash needs are being met by advances from its largest shareholder.  It is not known how much longer the shareholder will continue to support the company’s cash needs.

The Company does not have any assets with which it can satisfy any of its outstanding obligations.  The Company’s ability to survive is in question.  The Company is dependent on issuing its stock to exchange for goods and services.

Seasonal Fluctuations

There have been no fluctuations in our business to date which can be attributed to seasonality.

 
 
 
 
Employment Agreements

Currently, we have no written employment agreements with any of our employees or officers.

Additional Employee Benefits: The Company has no employees.

Capital Commitments

The Company currently has no commitments for capital expenditures.

Trends

None. The Company does not have any operations at this time.


Risk Factors

We have a limited operating history and a history of substantial operating losses and we may not be able to continue our business.

We have a history of substantial operating losses as of June 30, 2009. For the nine months ended June 30, 2009, our net loss was $456,694. We have historically experienced cash flow difficulties primarily because our expenses have exceeded our revenues. We expect to incur additional operating losses for the immediate near future. These factors, among others, raise significant doubt about our ability to continue as a going concern. If we are unable to generate sufficient revenue from our operations to pay expenses or we are unable to obtain additional financing on commercially reasonable terms, our business, financial condition and results of operations will be materially and adversely affected.

We will need additional financing in order to continue our operations which we may not be able to raise.

We will require additional capital to finance our future operations.  We can provide no assurance that we will obtain additional financing sufficient to meet our future needs on commercially reasonable terms or otherwise.  If we are unable to obtain the necessary financing, our business, operating results and financial condition will be materially and adversely affected.

If we are unable to successfully integrate acquisitions, our revenue growth and future profitability may be negatively impacted.

The process of integrating an acquired business, technology or product may result in unforeseen operating difficulties and expenditures and may absorb significant management attention and capital that would otherwise be available for ongoing development of our business. In addition, we may not be able to maintain the levels of operating efficiency that any company we may acquire achieved or might have achieved separately. Additional risks we face include:

 
·
the need to implement or remediate controls, procedures and policies appropriate for a public company in an acquired company that, prior to the acquisition, lacked these controls, procedures and policies;
 
 
·
cultural challenges associated with integrating employees from an acquired company or business into our organization;
 
 
·
retaining key employees from the businesses we acquire;
 
 
·
the need to integrate an acquired company’s accounting, management information, human resource and other administrative systems to permit effective management; and
 
 
·
to the extent that we engage in strategic transactions outside of the United States, we face additional risks, including risks related to integration of operations across different cultures and languages, currency risks and the particular economic, political and regulatory risks associated with specific countries.

Future acquisitions and investments could involve the issuance of our equity securities, potentially diluting our existing shareholders, the incurrence of debt, contingent liabilities or amortization expenses, write-offs of goodwill, intangibles, or acquired in-process technology, or other increased expenses, any of which could harm our financial condition. Our shareholders may not have the opportunity to review, vote on or evaluate future acquisitions or investments.

We do not expect to pay dividends on our common stock.

We have not declared dividends on our common stock since our incorporation and we have no present intention of paying dividends on our common stock.

MANY OF THESE RISKS AND UNCERTAINTIES ARE OUTSIDE OF OUR CONTROL AND ARE DIFFICULT FOR US TO FORECAST.  ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THOSE EXPRESSED OR IMPLIED IN THE FORWARD-LOOKING STATEMENTS.

 
 
 
 
Critical Accounting Policies

The following is a discussion of the accounting policies that the Company believes are critical to its operations:

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure 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 those estimates.

Income Taxes

The Company accounts for its income taxes using SFAS No. 109, “Accounting for Income Taxes”, which requires the recognition of deferred tax liabilities and assets for expected future tax consequences of events that have been included in the financial statements or tax returns.  Under this method, deferred tax liabilities and assets are determined based on the difference between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse.

Effective January 1, 2007, the Company adopted the provisions of FASB Interpretation No. 48 (“FIN 48”), “Accounting for Uncertainty in Income Taxes — An Interpretation of FASB Statement No. 109.” FIN 48 provides detailed guidance for the financial statement recognition, measurement and disclosure of uncertain tax positions recognized in the financial statements in accordance with SFAS No. 109. Tax positions must meet a “more-likely-than-not” recognition threshold at the effective date to be recognized upon the adoption of FIN 48 and in subsequent periods. Upon the adoption of FIN 48, the Company had no unrecognized tax benefits. During the three months ended December 31, 2008, the Company recognized no adjustments for uncertain tax benefits.

Intangible Assets

Intangible assets are comprised of patent and CE costs and a CE designation. Intangible assets, excluding goodwill, are stated on the basis of cost and will be amortized on a straight-line basis over estimated lives of ten years. Intangible assets with indefinite lives are not amortized but are evaluated for impairment annually unless circumstances dictate otherwise. Management periodically reviews intangible assets for impairment based on an assessment of undiscounted future cash flows, which are compared to the carrying value of the intangible assets. Should these cash flows not equal or exceed the carrying value of the intangible, a discounted cash flow model is used to determine the extent of any impairment charge required.

Off-Balance Sheet Arrangements

We do not have any off balance sheet arrangements that are reasonably likely to have a current or future effect on our financial condition, revenues, and results of operations, liquidity or capital expenditures.


We maintain disclosure controls and procedures that are designed to ensure (1) that information required to be disclosed by us in the reports we file or submit under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission’s (“SEC”) rules and forms, and (2) that this information is accumulated and communicated to our management, including our Chief Executive Officer and Assistant Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.  In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily was required to apply its judgment in evaluating the cost benefit relationship of possible controls and procedures.

Prior to the filing date of this report, under the supervision and review of our Chief Executive Officer and Assistant Chief Financial Officer, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this report.  Based on that evaluation, our Chief Executive Officer and Assistant Chief Financial Officer have concluded that our disclosure controls and procedures are effective in alerting them in a timely manner to material information regarding that is required to be included in our periodic reports to the SEC.

In addition, there have been no significant changes in our internal controls or in other factors that could significantly affect those controls that occurred during the fiscal quarter covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.  We can provide no assurance, however, that our system of disclosure controls and procedures will always achieve its stated goals under all future conditions, no matter how remote.


 
 
 


PART II - OTHER INFORMATION


None


None


Not applicable.


None


Not applicable.


Number
  
Description
     
3.1
  
Articles of incorporation, including amendments, incorporated by reference to the registrant’s Form 10 filed on July 16, 2008
     
3.2
  
By laws, including amendments, incorporated by reference to the registrant’s Form 10 filed on July 16, 2008
     
10.1
  
Form 10, dated as of July 16, 2008
     
31.1
  
Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
     
31.2
  
Certification of the Assistant Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
     
32.2
  
Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350 pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
     
32.2
  
Certification of the Assistant Chief Financial Officer pursuant to 18 U.S.C. Section 1350 pursuant to Section 906 of the Sarbanes-Oxley Act of 2002


 
 
 

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

Date:  August 18, 2009

   
LIFEHEALTHCARE CORP.
     
   
/s/ Martin C. Licht
   
Martin C. Licht
   
Executive Vice President


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

Date:  August 18, 2009

   
LIFEHEALTHCARE CORP.
     
   
/s/ John Grippo
   
John Grippo
   
Chief Financial Officer