SCHEDULE 14C INFORMATION
Information Statement Pursuant to Section 14(c) of
the Securities Exchange Act of 1934
Check the appropriate box:
/ / Preliminary Information Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14c-5(d)(2))
/x / Definitive Information Statement
InterCare DX, Inc.
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(Name of Registrant As Specified In Its Charter)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required
/ / Fee computed on table below per Exchange Act Rules 14c-5(g) and 0-11
(1) Title of each class of securities to which transaction
applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
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InterCare DX, Inc.
6201 Bristol Parkway
Culver City, California 90230
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
To be held on March 10, 2007
To the stockholders of InterCare DX, Inc.:
Notice is hereby given of a special meeting of shareholders of InterCare DX,
Inc. (the "Company" or "InterCare") to be held on March 10, 2007 at 1 P.M.
P.S.T. at the Company's office at 6201 Bristol Parkway, Culver City California
for the following purposes:
1. To re-elect three members of the Company's Board of Directors to serve
for a one-year term
2. To consider and vote upon a proposal to re-approve the Company's 2001 Joint
Incentive and Non-Qualified Stock Option Plan for the 2007 fiscal
year,
3. To ratify the appointment of Pollard-Kelly Auditing Services, Inc., as
our Independent registered public accounting firm for the fiscal year ended
December 31,2006; and
4. To transact such other business as may properly come before the Meeting and
any adjournment or postponement thereof.
Common stockholders of record on the close of business on, December 31
2006 are entitled to notice of the meeting. All stockholders are cordially
invited to attend the meeting in person , however the majority shareholder does
not need your vote to effect the changes above.
By Order of the Board of Directors,
/s/ Anthony C. Dike, MD
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Anthony C. Dike, MD
Chairman of the Board of Directors
March 3 , 2007
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InterCare DX, Inc.
6201 Bristol Parkway
Culver City, California 90230
INFORMATION STATEMENT
March 3, 2007
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This Information Statement is furnished by the Board of Directors of The
InterCare DX, Inc. (the "Company" and "InterCare") to provide notice of a
Special Meeting of Stockholders of the Company which will be held on
March 10, 2007 at 1 P.M.P.S.T. at the Company's corporate offices
at 6201 Bristol Parkway, Culver City, California (the "Meeting").
The record date for determining stockholders entitled to receive this
Information Statement has been established as the close of business on
December 31, 2006 (the "Record Date"). This Information Statement will be first
mailed on or about March 5, 2007 to stockholders of record at the close of
business on the Record Date. As of the Record Date, there were 19,903,902 shares
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of the Company's Common Stock outstanding and 20,000,000 shares of the Company's
preferred stock outstanding. The holders of all outstanding shares of Common
Stock are entitled to one vote per share of Common Stock registered in their
names on the books of the Company at the close of business on the Record Date
The presence at the special meeting of the holders of a majority of the
outstanding shares of stock entitled to vote at the special meeting are
necessary to constitute a quorum. The Board of Directors is not aware of any
matters that are expected to come before the special meeting other than the
matters referred to in this Information Statement.
The matters scheduled to come before the special meeting require the
approval of a majority of the votes cast at the special meeting. Our Chief
Executive Officer and Director, Anthony C. Dike (our "Majority Shareholder"),
beneficially owned 15,402,600 shares of common stock, or 71% of our
------
outstanding common stock as of the Record Date, which allows him
to vote in aggregate 15,402,600 voting shares, based on 19,903,902 total
voting shares outstanding as of the Record Date, and will therefore be able to
approve the matters presented in this Information Statement. The Company is not
soliciting your vote as the Majority Shareholder already has the vote in
hand.
WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT
TO SEND US A PROXY.
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PROPOSAL NUMBER 1
ELECTION OF DIRECTORS
The Company's Bylaws provide that the number of directors constituting the
Company's Board of Directors shall be fixed by the Board of Directors,
provided that the number of directors shall not be fewer than one nor more
than nine. The Board of Directors has fixed at five the number of directors
that will constitute the Board. Each director elected at the meeting will serve
until his or her term expires and until his or her successor has been duly
elected and qualified. The following members of the board of directors:
Donald Stanford, Wesley Bradford, MD, and Jude Uwaezuoke will be voted for by
the Majority of Our Shareholders, absent contrary instructions.
The Board of Directors has no reason to believe that any nominee will
refuse to act or be unable to accept election; however, in the event that a
nominee for director is unable to accept election or if any other unforeseen
contingency arises, proxies will be voted for the remaining nominees, if any,
and for such other person as may be designated by the Board of Directors, unless
it is directed by a proxy to do otherwise.
Certain information concerning the nominees for election as directors
is as follows:
Name Age Title
Jude Uwaezuoke 62 Director
Donald Stanford 56 Director
Wesley Bradford 66 Director
Jude Uwaezuoke, who has over 15 years of administrative, marketing
and financial management experience, is president of Speedy-Care Medical
Distributors (Inglewood, Calif.), a privately held durable medical equipment
retailer. Currently in his third year of study at West Los Angeles
University Law School, Uwaezuoke received a BS from California State
University Dominguez Hills and an MBA from West Coast University.
Dr. Bradford, a graduate of New York University School of Medicine is
Medical Director of Capnet IPA (Los Angeles). Since 1982, has served on the
Clinical faculty in family medicine at Harbor-UCLA Medical Center since 1982.
He is co-author of a pharmaceutical proposal that helps the center save over
$1 million annually. In conjunction with his humanitarian work as a member of
the Rotarian Polio-Corrective Surgery Team for Crippled Children, he has worked
toward bettering the lives of crippled children in both Uganda and India. In
1987 he co-founded a medical group in Torrance, Calif. Bradford, who has a
Masters Degree in public health from UCLA and an MBA from Cal State Long
Beach, is a Fellow of the American Academy of Family Physicians since 1980.
He has a special academic interest in electronic medical record systems
has served as a consultant to the state, county and municipal governments
in the areas of electronic death registration system development, primary care
case management, and health care access. Dr. Bradford has not held any position
in a reporting public company during the last five years.
Mr. Stanford is a seasoned executive who has spent the last 23 years in
Senior Management of a successful technology company that has enjoyed
considerable success in growth, industry leadership and creating value for its
shareholders. He possesses the rare combination of technology skills, hands-on
P&L expertise, corporate leadership and customer communications with the ability
to work in a team environment and achieve extraordinary results under
challenging conditions.
He was formerly the Senior Vice President and Chief Technology officer of GTECH
Holdings, Inc., a multi-national information technology company. During his
twenty-two years with GTECH, the Company has grown from a market share of 5%
and sales of less than $1 million to a dominant worldwide market share of 70%
and sales in excess of $1 billion as of the end of 2002. The Company has been
consistently profitable and has been the driving force in the last decade in
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the development and installation of on-line lottery systems in North America,
Europe, South America, Africa and Asia, and employs over 4,500 people worldwide.
As an important factor in this success, Mr. Stanford has traveled extensively
and collaborated with a large number of domestic and international customers and
partners.
Mr. Stanford earned a Bachelor of Arts in International Relations in 1972 and a
Master's in Computer Science/Applied Math in 1977 from Brown University. He has
recently been appointed Adjunct Professor of Computer Science at Brown
University and in 1999 received the Black Engineer of the Year Award for
Professional Achievement.
The election of the nominees requires the affirmative vote of a majority of the
shares of Common Stock represented at the Annual Meeting and entitled to vote
thereon.
The business of the Company is managed under the direction of the Board. The
Board presently consists of four directors, three of which are outside members
and two are officers of the Company. The Board members will serve until
their successors are elected at the 2008 Annual Meeting, unless they earlier
resign or are removed as provided in the Bylaws.
Term and Classification of Board of Directors
The Board of Directors has determined that there will be two Class of
Directors and the full Board shall consist of five directors. Class A
Directors are elected every three years and Class B Directors are elected each
year for one-year term. The stockholders will elect four Class B directors
for the coming year.
REPORT OF THE BOARD OF DIRECTORS
The Board of Directors, which consists of four directors, three of which are
outside members and one is an officer of the Company, establishes the
general compensation policies of the Company and the compensation plans and
specific compensation levels for executive officers.
The Company's objective is to ensure that executive compensation be directly
linked to ongoing improvement in corporate performance and increasing
shareholder value. The following objectives are guidelines for compensation
decisions:
Job Classification.
The Company assigns a job grade to each salaries position, and each job grade
has a salary range, which is based on national salary surveys. These salary
ranges are reviewed annually to determine parity with national compensation
trends, and to ensure that the Company maintains a competitive compensation
structure.
Competitive Salary Base.
Actual salaries are based on individual performance contributions within a
competitive salary range for each position established through job evaluation
and market comparisons. The salary of each corporate officer is reviewed
annually by the Board of Directors. As of this writing, Anthony C. Dike, MD
has not received any monetary compensation from the Corporation, he has elected
to be compensated in Company's stock and stock options, until such a time the
Company can afford to pay him salary.
Stock Option Programs.
The purposes of the Company's ESOP and SOP are to provide additional
incentives to employees to work to maximize shareholder value. The ESOP
is open to all full-time employees of the Company and the SOP is open to
participation by key employees and other persons as determined by the
Board, based upon a subjective evaluation of the key employee's ability to
influence the Company's long-term growth and profitability. Stock options
under the ESOP may be granted at the current market price at the time of the
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grant or under the SOP at prices as determined by the Board. With specific
reference to the Chief Executive Officer, the Board attempts to exercise
great latitude in setting salary and bonus levels and granting stock options.
Philosophically, the Board attempts to relate executive compensation to
those variables over which the individual executive generally has control. The
Chief Executive Officer has the primary responsibility for improving
shareholder value for the whole Company.
The Board believes that it's objectives of linking executive compensation to
corporate performance results in alignment of compensation with corporate goals
and shareholder interest. When performance goals are met or exceeded,
shareholders' value is increased and executives are rewarded commensurately. The
Board believes that compensation levels during 2003/2004 adequately reflect the
Company's compensation goals and policies. In 1993, the Internal Revenue Code
was amended to add section 162(m), which generally disallows a tax deduction for
compensation paid to a company's senior executive officers in excess of $1
million per person in any year. Excluded from the $1 million limitation is
compensation which meets pre-established performance criteria or results from
the exercise of stock options which meet certain criteria. While the Company
generally intends to qualify payment of compensation under section 162(m), the
Company reserves the right to pay compensation to its executives from time to
time that may not be tax deductible.
The Company will compensate the members of the Board of Directors for each
meeting he/she attends, in the amount of $250 cash or equivalent in the form of
the Company's Common Stock at the fair market value.
COMMITTEES OF THE BOARD OF DIRECTORS
FUNCTIONS OF COMMITTEES
AUDIT AND ETHICS COMMITTEE:
- Has general powers relating to accounting disclosure and auditing
matters;
- Recommends the selection and monitors the independence of our
independent auditors;
- Reviews the scope and timing of the independent auditors' work;
- Reviews the financial accounting and reporting policies and principles
appropriate for the Corporation, and recommendations to improve
existing practices;
- Reviews the financial statements to be included in the Corporation's
Annual Report on Form 10-KSB
- Reviews accounting and financial reporting issues, including the
adequacy of disclosures;
- Monitors compliance with the Code of Ethics and Standards of Conduct;
- Reviews and resolves all matters presented to it by our Ethics office;
- Reviews and monitors the adequacy of our policies and procedures, and
the organizational structure for ensuring general compliance with
environmental, health and safety laws and regulations;
- Reviews with the General Counsel the status of pending claims,
litigation and other legal matters;
- Meets separately and independently with the Chief Financial officer,
Internal Audit and our independent auditors.
It is composed of Messrs. Bradford, Uwaezuoke and Anthony C. Dike
EXECUTIVE COMMITTEE:
The Executive Committee may exercise the power of the Board of
Directors in the management of the business and affairs of the Corporation at
any time when the Board of Directors is not in session. The Executive
Committee shall, however, be subject to the specific direction of the Board of
Directors and all actions must be by unanimous vote. It is composed of Messrs.
Dike, Bradford, and Jude Uwaezoke
Meetings of the Board of Directors
During the fiscal year ended December 31, 2006, the Company's Board of
Directors acted four times by a unanimous written consent in lieu of a
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meeting. Each member of the Board participated in each action of the Board.
AUDIT AND ETHICS COMMITTEE REPORT
Management has the primary responsibility for the financial reporting process
and the audited consolidated financial statements, including the systems of
internal controls. The Corporation's independent auditor, Pollard-Kelly
Auditing Services, Inc., is responsible for expressing an opinion on
the quality and conformity of consolidated financial statements with
accounting principles generally accepted in the United States. In our
capacity as members of the Audit and Ethics Committee and on behalf of
the Board of Directors, we oversee the Corporation's financial reporting
process and monitor compliance with its Code of Ethics and Business Conduct.
The Audit Committee has adopted a written charter, which has been approved
by the Board of Directors.
Members of the Audit and Ethics Committee:
Mr. Uwaezuoke Chairman
Dr. Anthony C. Dike
Dr. Wesley Bradford
Scientific Advisory Board
Duties and Functions
Members of InterCare DX, Inc. clinical advisory board will assist the
company in updating its knowledge-based clinical content and develop
clinical guidelines, pathways and protocols. Additionally, the advisory
board, working with program developers and management, will review
programmatic issues relating to compliance with appropriate regulatory
authorities. They will also serve on InterCare's Speakers Bureau
regarding practical, clinical issues relating to InterCare Vascular
Diagnostic Center, the Non-invasive Vascular Laboratory recently introduced
Into the market by the Company for the purposes of commercialization and
ICE(tm), the company's scalable healthcare software solution. ICE is
specifically designed to effect cost-effective integration of all
aspects of the healthcare enterprise through documentation, information
tracking and error reduction that supports patient safety and greater
efficiency among healthcare providers. This panel will be expanded in
future to include experts from different healthcare profession.
Members of the Clinical Advisory Board
Professor Emeritus Jeffrey Raines, professional experience includes over forty
years in academia, having received a Doctorate degree in Mechanical Engineering
from Massachusetts Institute of Technology and Doctorate degree in Medicine
Harvard Medical School under an NIH MD/PhD Training Fellowship in 1972. He has
An extensive formal education in the areas of clinical cardiovascular medicine
With surgical exposure, engineering and research. He is a Fellow of American
College of Cardiology. He has published extensively in the areas of
Cardiovascular Medicine. He most recently retired as a Professor of Surgery
From the University of Miami, Florida, USA.
Dr. Wesley Bradford, a graduate of New York University School of Medicine, is
Medical Director of Capnet IPA (Los Angeles). He has served on the
clinical faculty in family medicine at Harbor-UCLA Medical Center since
1982. He was co-author of a pharmaceutical proposal that helps the center
save over $1 million annually. He has done humanitarian work in both Uganda
and India as a member of an international Rotarian Polio-Corrective
Surgery Team for Crippled Children, bettering the lives of crippled
children there. In 1987 he co-founded a medical group in Torrance,
California. Bradford, who has a Masters Degree in public health from
UCLA and an MBA from Cal State Long Beach, has been a Fellow of the
American Academy of Family Physicians since 1980. He has a special
academic interest in electronic medical record systems, and has served as
a consultant to the state and county governments in the areas of
electronic death registration system development, primary care case
management, and health care access.
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Dr. Wignes Warren, an assistant clinical professor of pediatrics at the
University of Southern California, is licensed to practice medicine in the
states of California, New York , and holds current medical practice
licenses with the Ceylon Medical Council and the United Kingdom. He
received an MD with honors from the University of Sri Lanka and served as
the Chief Resident of Methodist Hospital (New York City) after serving
internships at General Hospital and Children's Hospital in Colombo,
Sri Lanka. He is a Fellow of the American Academy of Pediatrics. Certified
by the American Board of Managed Care Medicine, the American Board of
Quality Assurance and Utilization Review Physicians, and the American Board
of Forensic Medicine, Dr. Warren is currently a member of the Peer
Review Committee of Blue Shield of California.
Anthony C. Dike, MD, our Chairman, Chief Executive Officer, Secretary and a
director. Dr. Dike has been the Chairman of the Board, CEO and President of
the Company since August, 1999. Anthony C. Dike, a physician by training
and an entrepreneur that has funded and developed various start-up
high technology businesses from inception to fruition through his private
Investment Firm, MMG Investments Inc., a California corporation.
He is the founder of CGI Communications Services, Inc. He also is the
founder of the registrant formerly known as Intercare Diagnostics, Inc., a
United States Food and Drug Administration (USFDA) registered Bio-Medical
Software Manufacturing Company, with over 5 Multimedia healthcare related
software programs in the market. He also pioneered the design and
development of the Mirage Systems Biofeedback Software Program, the first
United States Food and Drug Administration approved software only for
Biofeedback and Relaxation Training. He is also the founder of Capnet IPA,
and Meridian Health Systems, Inc. Anthony C. Dike, MD, is also a member
of the peer-review standing panel for United States Department of
Education National Institute for Disability and Rehabilitation Research.
He has served as a consultant to United Nations Development Project-Sustainable
Human Development Program. He most recently pioneered the design and
development of "InterCare Clinical Explorer (ICE)", a scalable software
application specifically designed to effect cost-effective integration of all
aspects of the healthcare enterprise through documentation, information
tracking and error reduction that supports patient safety and greater
efficiency among healthcare providers.
Executive Officers
The executive officers of the Company are as follows:
Anthony C. Dike, Chairman/CEO
EXECUTIVE COMPENSATION
The table below shows information concerning the annual and long-term
compensation for services in all capacities to the Company for the Chief
Executive Officer and other full-time employee executive officers of the
Company:
Annual Compensation
<CAPTION
Name Year Salary Bonus Stock Option All Other Compensation
(Common Stock)
Anthony C. Dike (1) 2006 $0 0 100,000 0
<FN>
1. As of December 31, 2006, Anthony C. Dike has not received any salary from
the registrant, and has deferred such payment until the registrant can afford to
pay after meeting all other obligations.
Indemnification
The Company's Certificate of Incorporation eliminates or limits the
personal financial liability of the Company's directors, except in situations
where there has been a breach of the duty of loyalty, failure to act in good
faith, intentional misconduct or knowing violation of the law. In addition, the
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Company's by-laws include provisions to indemnify its officers and directors and
other persons against expenses, judgments, fines and amounts paid in settlement
in connection with threatened, pending or completed suits or proceedings against
such persons by reason of serving or having served as officers, directors or in
other capacities, except in relation to matters with respect to which such
persons shall be determined to have acted not in good faith, unlawfully or not
in the best interest of the Company.
INSOFAR AS INDEMNIFICATION FOR LIABILITIES ARISING UNDER THE SECURITIES
ACT OF 1933 MAY BE PERMITTED TO DIRECTORS, OFFICERS OR PERSONS CONTROLLING THE
COMPANY PURSUANT TO THE FOREGOING PROVISIONS, THE COMPANY HAS BEEN INFORMED THAT
IN THE OPINION OF THE SECURITIES AND EXCHANGE COMMISSION, SUCH INDEMNIFICATION
IS AGAINST PUBLIC POLICY AS EXPRESSED IN THE ACT AND IS THEREFORE UNENFORCEABLE.
Compliance with Section 16(a) of the Securities Exchange Act of 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors and executive officers, and persons who own more than ten
percent of a registered class of the Company's equity securities, to file with
the SEC initial reports of ownership and reports of changes in ownership of
equity securities of the Company with the Securities and Exchange Commission
("SEC"). Such persons also are required by SEC regulation to furnish the
Company with copies of all Section 16(a) forms they file.
To the Company's knowledge, based solely on review of the copies of
such forms that were furnished to the Company and representations that no other
reports were required, during the fiscal year ended December 31, 2006, the
Company's officers, directors and greater than 10% stockholders complied with
all filing requirements under Section 16(a) applicable to such persons.
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.
OUTSTANDING SHARES AND VOTING RIGHTS
The Board of Directors has set the close of business on December
31, 2006 as the record date (the "Record Date") for determining stockholders
of the Company entitled to notice of and to vote at the Meeting. As of the
record date, 19,613,902 shares of Common Stock were issued and outstanding, all
of which are entitled to be voted at the meeting. Each share of Common Stock
is entitled to one vote on all matters to be acted upon at the Meeting,
and neither the Company's Certificate of Incorporation nor its Bylaws
provides for cumulative voting rights.
The attendance, in person, of the holders of a majority of the shares
of Common Stock entitled to vote at the meeting is necessary to
constitute a quorum. The affirmative vote of a plurality of the shares of Common
Stock present and voting at the meeting is required for the election of
Directors. The affirmative vote of a majority of the outstanding shares of
Common Stock present and voting at the meeting is required to pass upon the
proposals to ratify the appointment of Pollard-Kelly Auditing Services, Inc., as
the Company's independent certified public accountant for the fiscal year ending
December 31, 2006; and to consider and vote upon a proposal to re-approve
the Company's 2001 Joint Incentive and Non-Qualified Stock Option Plan for
the 2007 fiscal year.
As of the Record Date, the directors of the Company owned in the
aggregate 15,802,600 shares of Common Stock constituting approximately 80% of
the outstanding shares of Common Stock entitled to vote at the Meeting. The
directors have advised the Company that they intend to vote all of their shares
in favor of each of the proposals to be presented at the Meeting.
IS THE COMPANY ASKING FOR MY PROXY?
Our Majority Shareholder will ratify the appointment of Messers:
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Jude Uwaezuoke, Wesley Bradford and Donald Stanford as the nominee for
Class B Directors for the next fiscal year or until there successors
are appointed and ratified. Therefore, the Company is not asking for your
proxy, and the Company requests that you do not send a proxy, as no further
shareholder approval is either required or sought.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE COMPANY'S STOCKHOLDERS VOTE FOR
ELECTION OF THE NOMINEES AS THE MEMBERS OF THE BOARD OF DIRECTORS FOR THE YEAR
2007
[Remainder of page left intentionally blank.]
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PROPOSAL NO. 2
RATIFY THE COMPANY'S 2007 STOCK INCENTIVE PLAN
WHAT ARE THE MAJORITY SHAREHOLDERS RATIFYING?
On February 5, 2007, the Company's Board of Directors adopted, subject to
The approval of our majority shareholders, the Company's 2007 Stock Incentive
Plan (the "Plan") in a form substantially similar to the attached Appendix B.
At the special meeting, our Majority Shareholders will ratify the adoption of
the Plan.
The following is a summary of the material features of the Plan:
WHAT IS THE PURPOSE OF THE PLAN?
The Plan is intended to secure for the Company the benefits arising from
ownership of the Company's common stock by the employees, officers, Directors
and consultants of the Company, all of whom are and will be responsible for the
Company's future growth. The Plan is designed to help attract and retain for the
Company, personnel of superior ability for positions of exceptional
responsibility, to reward employees, officers, Directors and consultants for
their services to the Company and to motivate such individuals through added
incentives to further contribute to the success of the Company.
WHO IS ELIGIBLE TO PARTICIPATE IN THE PLAN?
The Plan will provide an opportunity for any employee, officer, Director or
consultant of the Company, except for instances where services are in connection
with the offer or sale of securities in a capital-raising transaction, or they
directly or indirectly promote or maintain a market for the Company's
securities, subject to any other limitations provided by federal or state
securities laws, to receive (i) incentive stock options (to eligible employees
only); (ii) nonqualified stock options; (iii) restricted stock; (iv) stock
awards; (v) shares in performance of services; or (vi) any combination of the
foregoing. In making such determinations, the Board of Directors may take into
account the nature of the services rendered by such person, his or her present
and potential contribution to the Company's success, and such other factors as
the Board of Directors in its discretion shall deem relevant.
WHO WILL ADMINISTER THE PLAN?
The Plan shall be administered by the Board of Directors of the Company.
The Board shall have the exclusive right to interpret and construe the Plan, to
select the eligible persons who shall receive an award, and to act in all
matters pertaining to the grant of an award and the determination and
interpretation of the provisions of the related award agreement, including,
without limitation, the determination of the number of shares subject to stock
options and the option period(s) and option price(s) thereof, the number of
shares of restricted stock or shares subject to stock awards or performance
shares subject to an award, the vesting periods (if any) and the form, terms,
conditions and duration of each award, and any amendment thereof consistent with
the provisions of the Plan.
HOW MUCH COMMON STOCK IS SUBJECT TO THE PLAN?
Subject to adjustment in connection with the payment of a stock dividend, a
stock split or subdivision or combination of the shares of Common Stock, or a
reorganization or reclassification of the Company's common stock, the maximum
aggregate number of shares of common stock which may be issued pursuant to
awards under the Plan is Five Million (5,000,000) shares. Such shares of
Common Stock shall be made available from the authorized and unissued
shares of the Company.
WHAT IS THE EXERCISE PRICE AND EXPIRATION DATE OF OPTIONS AND AWARDS UNDER THE
PLAN?
The Board of Directors, in its sole discretion, shall determine the
exercise price of any Options granted under the Plan which exercise price shall
be set forth in the agreement evidencing the Option, provided however that a no
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time shall the exercise price be less than the $0.001 par value per share of the
Company's common stock. Additionally, the Board of Directors has sole discretion
over the authorization of any stock awards.
WHAT EQUITABLE ADJUSTMENTS WILL BE MADE IN THE EVENT OF CERTAIN CORPORATE
TRANSACTIONS?
Upon the occurrence of:
(i) the adoption of a plan of merger or consolidation of the Company
with any other corporation or association as a result of which the holders
of the voting capital stock of the Company as a group would receive less
than 50% of the voting capital stock of the surviving or resulting
corporation;
(ii) the approval by the Board of Directors of an agreement providing
for the sale or transfer (other than as security for obligations of the
Company) of substantially all the assets of the Company; or
(iii) in the absence of a prior expression of approval by the Board of
Directors, the acquisition of more than 20% of the Company's voting capital
stock by any person within the meaning of Rule 13d-3 under the Act (other
than the Company or a person that directly or indirectly controls, is
controlled by, or is under common control with, the Company);
and unless otherwise provided in the award agreement with respect to a
particular award, all outstanding stock options shall become immediately
exercisable in full, subject to any appropriate adjustments, and shall remain
exercisable for the remaining option period, regardless of any provision in the
related award agreement limiting the ability to exercise such stock option or
any portion thereof for any length of time. All outstanding performance shares
with respect to which the applicable performance period has not been completed
shall be paid out as soon as practicable; and all outstanding shares of
restricted stock with respect to which the restrictions have not lapsed shall be
deemed vested, and all such restrictions shall be deemed lapsed and the
restriction period ended.
Additionally, after the merger of one or more corporations into the
Company, any merger of the Company into another corporation, any consolidation
of the Company and one or more corporations, or any other corporate
reorganization of any form involving the Company as a party thereto and
involving any exchange, conversion, adjustment or other modification of the
outstanding shares of the common stock, each participant shall, at no additional
cost, be entitled, upon any exercise of such participant's stock option, to
receive, in lieu of the number of shares as to which such stock option shall
then be so exercised, the number and class of shares of stock or other
securities or such other property to which such participant would have been
entitled to pursuant to the terms of the agreement of merger or consolidation or
reorganization, if at the time of such merger or consolidation or
reorganization, such participant had been a holder of record of a number of
shares of common stock equal to the number of shares as to which such stock
option shall then be so exercised.
WHAT HAPPENS TO OPTIONS UPON TERMINATION OF EMPLOYMENT OR OTHER RELATIONSHIPS?
The incentive stock options shall lapse and cease to be exercisable upon a
the termination of service of an employee or director as defined in the Plan, or
within such period following a termination of service as shall have been
determined by the Board and set forth in the related award agreement; provided,
further, that such period shall not exceed the period of time ending on the date
three (3) months following a termination of service.
MAY THE PLAN BE MODIFIED, AMENDED OR TERMINATED?
The Board of Directors may adopt, establish, amend and rescind such rules,
regulations and procedures as it may deem appropriate for the proper
administration of the Plan, make all other determinations which are, in the
Board's judgment, necessary or desirable for the proper administration of the
Plan, amend the Plan or a stock award as provided in Stock Option agreement.
12
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The description of the Plan is qualified in all respects by the actual
provisions of the Plan, which is attached to this information statement as
Appendix 99.1.
IS THE COMPANY ASKING FOR MY PROXY?
Our Majority Shareholder will ratify the adoption of the 2007 Stock
Incentive Plan covering Five Million (5,000,000) shares of our Common
Stock. Therefore, the Company is not asking for your
proxy, and the Company requests that you do not send a proxy, as no further
shareholder approval is either required or sought.
A MAJORITY OF THE BOARD OF DIRECTORS RECOMMEND A VOTE FOR RATIFYING THE
COMPANY'S 2007 STOCK INCENTIVE PLAN.
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PROPOSAL NUMBER 3
PROPOSAL TO RATIFY THE REAPPOINTMENT OF POLLARD-KELLY AUDITING SERVICES, INC.
AS INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
INFORMATION REGARDING OUR CERTIFIED PUBLIC ACCOUNTANT
The Board of Directors has appointed the firm of POLLARD-KELLY AUDITING SERVICES
Inc.,as the independent registered public accounting firm of the Company for the
year ending December 31, 2006, subject to ratification of the appointment by
the Company's stockholders. A representative of Pollard-Kelly Auditing Services
Inc., is not expected to attend the special meeting.
Effective November 8, 2006, the client auditor relationship between
InterCare DX, Inc. (the "Company") and Madsen Associates CPAs, Inc., Certified
Public Accountants, ("MADSEN") ceased as the former accountant was
dismissed. Effective November 8, 2006, the Company engaged Chang Park
Certified Public Accountant ("Park") as its principal independent public
Accountant for the quarter ended September 30, 2006, the later was not approved
by the Majority Shareholder for the 2006 annual audit, and on February 5, 2007
the Board of Directors approved Pollard-Kelly Auditing Services Inc., as the
Certified Public Accountants for the fiscal year ended December 31, 2006. The
decision to change accountants was recommended and approved by the Company's
Board of Directors effective February 5, 2007.
Madsens interim period reports on the financial statements of the
Company, including the interim period up to and including the date the
relationship with Madsen ceased, did not contain any adverse opinion or
disclaimer of opinion and was not qualified or modified as to uncertainty, audit
scope or accounting principles except for concerns about the Company's ability
to continue as a going concern.
Also, Parks interim period reports on the financial statements of the
Company, including the interim period up to and including the date the
relationship with Park ceased, did not contain any adverse opinion or
disclaimer of opinion and was not qualified or modified as to uncertainty, audit
scope or accounting principles except for concerns about the Company's ability
to continue as a going concern.
In connection with interim period reports, including the interim period up
to and including the date the relationship with Messers Madsen and Parks
ceased, there were no disagreements between Messers Madsen and Parks
and the Company on a matter of accounting principles or practices, financial
statement disclosure, or auditing scope or procedure, which disagreement, if
not resolved to the satisfaction of Messers Madsen and Parks would have caused
Messers Madsen and Parks to make reference to the subject matter of the
disagreement in connection with its report on the Company's financial
statements.
There have been no reportable events as provided in Item 304(a)(iv)(B) of
Regulation S-B during the Company's fiscal year ended December 31, 2006 and
December 31, 2005, and any later interim period, including the interim period up
to and including the date the relationship with Madsen ceased.
The Company has authorized Madsen to respond fully to any inquiries of any
new auditors hired by the Company relating to their engagement as the Company's
independent accountant. The Company had requested that Madsen to review the
disclosure and Madsen and was provided an opportunity to furnish the Company
with a letter addressed to the Commission containing any new information,
clarification of the Company's expression of its views, or the respect in
which it does not agree with the statements made by the Company herein.
Such letter is incorporated by reference to form 8k dated November 8, 2006
filed with SEC.
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The Company has not previously consulted with Pollard-Kelly Auditing
Services, Inc., regarding either (i)the application of accounting principles
to a specific completed or contemplated transaction; (ii) the type of audit
opinion that might be rendered on the Company's financial statements; or
(iii) a reportable event (as provided in Item 304(a)(iv)(B) of Regulation S-B)
during the Company's fiscal years ended December 31, 2006 and
December 31, 2005, and any later interim period, including the interim period
up to and including the date the relationship with Madsen and ceased.
Pollard-Kelly Auditing Services, Inc., has reviewed the disclosure
required by Item 304 (a) before it was filed with the Commission and has been
provided an opportunity to furnish the Company with a letter addressed to the
Commission containing any new information, clarification of the Company's
expression of its views, or the respects in which it does not agree with the
statements made by the Company in response to Item 304. (b) Pollard-Kelly
Auditing Services did not issue any letter.
REVIEW OF THE COMPANY'S AUDITED FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED
DECEMBER 31, 2005
The Board of Directors met and held discussions with management and the
independent auditors. Management represented to the Board of Directors that the
Company's consolidated financial statements were prepared in accordance with
accounting principles generally accepted in the United States, and the Board of
Directors reviewed and discussed the consolidated financial statements with
management and the independent auditors. The Board of Directors also discussed
with the independent auditors the matters required to be discussed by Statement
on Auditing Standards No. 61 (Codification of Statements on Auditing Standards,
AU 380), as amended.
In addition, the Board of Directors discussed with the independent auditors
the auditors' independence from the Company and its management, and the
independent auditors provided to the Board of Directors the written disclosures
and letter required by the Independence Standards Board Standard No. 1
(Independence Discussions With Audit Committees).
The Board of Directors discussed with the Company's internal and
independent auditors the overall scope and plans for their respective audits.
The Board of Directors met with the internal and independent auditors, with and
without management present, to discuss the results of their examinations, the
evaluation of the Company's internal controls, and the overall quality of the
Company's financial reporting.
Based on the reviews and discussions referred to above, the Board of
Directors approved the audited financial statements be included in the Company's
Annual Report on Form 10-KSB for the year ended December 31, 2005, for filing
with the Securities and Exchange Commission.
AUDIT FEES
The aggregate fees billed by our auditors, for professional services
rendered for the audit of the Company's annual financial statements for the
years ended December 31, 2005 and 2004, and for the reviews of the financial
statements included in the Company's Quarterly Reports on Form 10-QSB during the
fiscal years were $10,500 and $11,500, respectively.
We estimate that the audit fees to be incurred by us with Pollard-Kelly
Auditing Services, Inc., for fiscal 2005 and 2006 audit services to
be approximately $10,000.
AUDIT-RELATED FEES
Our independent registered public accounting firm did not bill the Company
for any other audit-related work during fiscal years ended December 31, 2004 or
2005, and subsequent interim period in 2006.
TAX FEES
Our independent registered public accounting firm did not bill the Company
for tax related work during fiscal years ended December 31, 2005 or 2004
15
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and subsequent interim period in 2006.
ALL OTHER FEES
Our independent registered public accounting firm did not bill the Company
for other services during fiscal years ended December 31, 2005 or 2004
and subsequent interim period in 2006.
REQUIRED VOTE
The ratification of the appointment of Pollard-Kelly Auditing
Services, Inc., as the Company's independent registered accounting firm for the
Fiscal year ending December 31, 2006, requires the affirmative vote of the
holders of a majority of the shares of the Company's common stock. The Majority
Shareholder will approve the appointment of Pollard-Kelly Auditing Services,
Inc., at the Meeting, and as a result, no other shareholder action is
requested or required.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" THE RATIFICATION
OF THE APPOINTMENT OF POLLARD-KELLY AUDITING SERVICES, INC. AS THE INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM OF THE COMPANY FOR THE FISCAL YEAR ENDING
DECEMBER 31, 2006.
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16
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PROPOSAL NUMBER 4
OTHER BUSINESS
The Board of Directors of the Company does not know of any other matters
that may be brought before the Meeting. However, should any additional matters
properly come before the meeting, it is the intention of the Majority
Shareholder to vote on such matters in accordance with their best judgment.
..
INTEREST OF CERTAIN PERSONS IN OR
OPPOSITION TO MATTERS TO BE ACTED UPON
(a) No officer or director of the Company has any substantial interest in
the matters to be acted upon, other than his role as an officer or director of
the Company, other than in connection with the granting of certain stock
options.
(b) No director of the Company has informed the Company that he intends to
oppose the action taken by the Company set forth in this information statement.
PROPOSALS BY SECURITY HOLDERS
No security holder has requested the Company to include any proposals in this
information statement.
PROXY SOLICITATION
We do not need your proxy. Please do not send any proxy, since the Majority
Shareholder has the vote to approve all action contemplated at the shareholder
meeting.
ADDITIONAL INFORMATION AVAILABLE
The Company files an Annual Report on Form 10-KSB with the Securities and
Exchange Commission. Stockholders may obtain a copy of this report
(without exhibits), without charge, by writing to Corporate InterCare DX, Inc.
6201 Bristol Parkway, Culver City, California 90230
BY ORDER OF THE BOARD OF DIRECTORS
/s/ ANTHONY C. DIKE
- ----------------------
Anthony C. Dike, MD, Director
17
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EXHIBIT 99.1
STOCK OPTION PLAN
OF
INTERCARE DX, INC.
SECTION 1 - DESCRIPTION OF PLAN. The Stock Option Plan (the "Plan"), of
---------------------------------
InterCare DX, Inc. (the "Company"), a corporation organized under the laws
of the State of California. Under this Plan, key employees of the Company or any
present and future subsidiaries of the Company to be selected as below set
forth, may be granted options (the "Options") to purchase shares of the Common
Stock, based on the average of the preceding 12 months fair-market value
of the Company's Common Stock("Common Stock"). For purposes of this Plan,
the term "subsidiary" mean any corporation 50% or more of the voting stock of
which is owned by the Company or by a subsidiary (as so defined) of the Company.
It is intended that the Options under this Plan will either qualify for
treatment as incentive stock options under Section 422 of the Internal Revenue
Code of 1986, as amended (the "Code") and be designated "Incentive Stock
Options" or not qualify for such treatment and be designated "Non-qualified
Stock Options".
SECTION 2 - PURPOSE OF PLAN. The purpose of the Plan and of granting
--------------------------------
options to specified employees is to further the growth, development and
financial success of the Company and its subsidiaries by providing additional
incentives to certain key employees holding responsible positions by assisting
them to acquire shares of Common Stock and to benefit directly from the
Company's growth, development and financial success.
SECTION 3 - ELIGIBILITY. The persons who shall be eligible to receive
---------------------------
grants of Options under this Plan shall be the directors, officers, key
employees and consultants of the Company or any of its subsidiaries. A person
who holds an Option is herein referred to as an "Optionee". More than one Option
may be granted to any one Optionee, however no Optionee may be granted options
to purchase an aggregate number of shares of Common Stock amounting to thirty
percent (30%) or more of the total number of shares that may be issued pursuant
to this Plan upon the exercise of Options granted hereunder.
For Incentive Stock Options, the aggregate fair market value (determined
at the time the Option is granted) of the Common Stock with respect to which
incentive stock options are exercisable for the first time by any Optionee
during any calendar year (under all Incentive Stock Option plans of the Company
or any subsidiary which are qualified under Section 422 of the Code) shall not
exceed $5,000,000.00 .
SECTION 4 -- ADMINISTRATION. The Plan shall be administered by a
-------------------------------
committee (the "Option Committee") to be composed of at least two
"disinterested" (as such term is used in Rule 16b-3 promulgated under the
Securities Exchange Act of 1934) members of the Board of Directors of the
Company (the "Board"). Members of the Option Committee shall be appointed, both
initially and as vacancies occur, by the Board, to serve at the pleasure of the
Board. The entire Board may serve as the Option Committee, if by the terms of
this Plan all Board members are otherwise eligible to serve on the Option
Committee. No person may serve as a member of the Option Committee if such
person (a) is eligible to receive an Option under the Plan or under any other
plan of the Company entitling the participants to acquire Common Stock or stock
options of the Company or any of its affiliates (other than plans excepted by
Rule 16b-3(c)(2)), or (b) was so eligible at any time within the preceding
one-year period. The Option Committee shall meet at such times and places as it
determines and may meet through a telephone conference call. A majority of its
members shall constitute quorum, and the decision of a majority of those present
at any meeting at which a quorum is present shall constitute the decision of the
Option Committee. A memorandum signed by all of its members shall constitute
the decision of the Option Committee without necessity, in such event, for
holding an actual meeting. The Option Committee is authorized and empowered to
administer the Plan and, subject to the Plan, including the provisions of
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Section 17, (i) to select the Optionees, to specify the number of shares of
Common Stock with respect to which Options are granted to each Optionee, to
specify the Option Price and the terms of the Options, and in general to grant
Options; (ii) to determine the dates upon which Options shall be granted and the
terms and conditions thereof in a manner consistent with this Plan, which terms
and conditions need not be identical as to the various Options granted; (iii) to
interpret the Plan; (iv) to prescribe, amend and rescind rules relating to the
Plan (v) to accelerate the time during which an Option may be exercised,
notwithstanding the provisions of the Option Agreement (as defined in Section
12) stating the time during which it may be exercised; (vi) to accelerate the
date by which any unexercised but vested portion of an Option terminates,
thereby requiring the Optionee to exercise the vested unexercised portion of
such Option or forfeit it, but in no event shall such date be less than two (2)
weeks later than the date the Optionee is informed of such acceleration; and
(vii) to determine the rights and obligations of participants under the Plan.
The interpretation and construction by the Option Committee of any provision of
the Plan or of any Option granted under it shall be final. No member of the
Option Committee shall be liable for any action or determination made in good
faith with respect to the Plan of any Option granted under it.
SECTION 5 -- SHARES SUBJECT TO THE PLAN. The aggregate number of shares
-----------------------------------------
of Common Stock which may be purchased pursuant to the exercise of Options
(whether Incentive Stock Options or Non-qualified Stock Options) granted under
the Plan shall not exceed 5,000,000 shares. Upon the expiration or termination
for any reason of an outstanding Option which shall not have been exercised in
full or upon the repurchase by the Company of shares of Common Stock issued
pursuant to rights of repurchase, any shares of Common Stock then remaining
unissued which shall have been reserved for issuance upon such exercise or which
shall have been repurchased shall again become available for the granting of
additional Options under the Plan.
SECTION 6 -- OPTION PRICE. Expect as provided in Section 11, the purchase
--------------------------
price per share (the "Option Price") of the shares of Common Stock underlying
each Option shall be not less than the fair market value of such shares on the
date of granting of the Option. Such fair market value shall be determined by
the Option Committee on the basis of reported closing sales price on such date
or, in the absence of reported sales price on such date, on the basis of the
average of reported closing bid and asked prices on such date. In the absence
of either reported sales price or reported bid and asked prices, the Option
Committee shall determine such market value on the basis of the best available
evidence.
SECTION 7 -- EXERCISE OF OPTIONS. Subject to all other provisions of
-------------------------------------
this Plan, each Option shall be exercisable for the full number of shares of
Common Stock subject thereto, or any part thereof, in such installments and at
such intervals as the Option Committee may determine in granting such Option,
provided that (i) each Option shall become fully exercisable no later than five
(5) years from the date the Option is granted, (ii) the number of shares of
Common Stock subject to each Option shall become exercisable at the rate of at
least 20% per year each year until the Option is fully exercisable, and (iii) no
option may be exercisable subsequent to its termination date. Each Option shall
terminate and expire, and shall no longer be subject to exercise, as the Option
Committee may determine in granting such Option, but in no event later than ten
years after the date of grant thereof. The Option shall be exercised by the
Optionee by giving written notice to the Company specifying the number of shares
to be purchased and accompanied by payment of the full purchase price therefor
in cash, by check or in such other form of lawful consideration as the Board may
approve from time to time, including, without limitation and in the sole
discretion of the Board, the assignment and transfer by the Optionee to the
Company of outstanding shares of the Company's Common Stock theretofore held by
Optionee.
SECTION 8 -- ISSUANCE OF COMMON STOCK. The Company's obligation to issue
--------------------------------------
shares of its Common Stock upon exercise of an Option granted under the Plan is
expressly conditioned upon the completion by the Company of any registration or
other qualification of such shares under any state and/or federal law or ruling
19
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or regulations or the making of such investment or other representations and
undertakings by the Optionee (or his or her legal representative, heir or
legatee, as the case may be) in order to comply with the requirements of any
exemption from any such registration or other qualification of such shares which
the Company in its sole discretion shall deem necessary or advisable. Such
required representations and undertakings may include representations and
agreements that such Optionee (or his or her legal representative, heir or
legatee): (a) is purchasing such shares for investment and not with any present
intention of selling or otherwise disposing thereof; and (b) agrees to have a
legend placed upon the face and reverse of any certificates evidencing such
shares (or, if applicable, and appropriate data entry made in the ownership
records of the Company) setting forth (i) any representations and undertaking
which such Optionee and undertaking which such Optionee has given to the Company
or a reference thereof, and (ii) that, prior to effecting any sale or other
disposition of any such shares, the Optionee must furnish to the Company an
opinion of counsel, satisfactory to the Company and its counsel, to the effect
that such sale or disposition will not violate the applicable requirements of
state and federal laws and regulatory agencies. The Company will make a
reasonable good faith effort to comply with such state and/or federal laws,
rulings or regulations as may be applicable at the time the Optionee (or his or
her legal representative, heir or legatee, as the case may be) wishes to
exercise an Option, provided that the Optionee (or his or her legal
representative, heir or legatee) also makes a reasonable good faith effort to
comply with said laws, rulings and regulations; however, there can be no
assurance that either the Company or the Optionee (or his or her legal
representative, heir or legatee), each in the respective exercise of their
reasonable good faith business judgment, will in fact comply with said laws,
ruling and regulations.
SECTION 9 -- NONTRANSFERABILITY. No Option shall be assignable or
-----------------------------------
transferable, except that an Option may be transferable by will or by the laws
of descent and distribution or pursuant to qualified domestic relations order as
defined by the Code or Title I of the Employee Retirement Income Security Act,
or the rules thereunder, provided such Option explicitly so provides. During
the lifetime of an Optionee, any Option granted to him or her shall be
exercisable only by him or her. After the death of an Optionee, the Option
granted to him (if so transferable) may be exercised, prior to its termination,
only by his or her legal representative, his legatee or a person who acquired
the right to exercise the Option by reason of the death of the Optionee.
SECTION 10 -- RECAPITALIZATION, REORGANIZATION, MERGER OR CONSOLIDATION.
--------------------------------------------------------------------------
If the outstanding shares of Common Stock of the Company are increased,
decreased, or exchanged for different securities through reorganization, merger,
consolidation, recapitalization, reclassification, stock split, stock dividend
or like capital adjustment, a proportionate adjustment shall be made (a) in the
aggregate number of shares of Common Stock which may be purchased pursuant to
the exercised of Options granted under the Plan, as provided in Section 5, and
(b) in the number, price, and kind of shares subject to any outstanding Option
granted under the Plan.
Upon the dissolution or liquidation of the Company or upon any
reorganization, merger, or consolidation in which the Company does not survive
or in which the equity ownership of the Company prior to such transaction
represents less than 50% of the equity ownership of the Company subsequent to
the transaction, the Plan and each outstanding Option shall terminate; provided
that the Company will give written notice thereof each Optionee at least thirty
(30) days prior to the date of such dissolution, liquidation, reorganization,
merger or consolidation, and in such event (a) the Company may, but shall not be
obligated to, with respect to each Optionee who is not tendered an option by the
surviving corporation in accordance with all of the terms of provision (b)
immediately below, grant the right, until ten days before the effective date of
such dissolution, liquidation, reorganization, merger or consolidation, to
exercise, in whole or in part, any unexpired Option or Options issued to him or
her, without regard to the surviving entity.
SECTION 12 -- OPTION AGREEMENT. Each Option granted under the Plan
-----------------------------------
shall be evidenced by a written stock option agreement executed by
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the Company and accepted by the Optionee, which (a) shall contain each of
the provisions and agreements herein specifically required to be contained
therein, (b) shall contain terms and conditions permitting such Option to
qualify for treatment as an incentive stock option under Section 422 of the
Code if the Option is designated an Incentive Stock Option,
(c) may contain the agreement of the Optionee to resell any Common Stock
issued pursuant to the exercise of Options granted under the Plan to the
Company (or its assignee) for the Option Price of such Options to the extent
any vesting restrictions apply to such Common Stock, or for the then fair
market value of such Common Stock if no such restrictions then apply,
(d) may contain the agreement of the Optionee granting a right of
first refusal to the Company (or its assignee) on transfers of Common Stock no
subject to vesting restrictions, and (e) may contain such other terms and
conditions as the Option Committee deems desirable and which are not
inconsistent with the Plan. With regard to agreements of the Optionee
contemplated by items (c) and (d) of the previous sentence, the Company's rights
pursuant to a right of first refusal and, notwithstanding any other termination
provisions, the Company's right to repurchase vested shares shall terminate upon
the closing of the first sale of the Common Stock of the Company to the public
pursuant to a registration statement filed with, and declared effective by the
Securities and Exchange Commission under the Securities Act of 1933, as amended,
with gross proceeds to the Company as seller of not less than $7.5 million
before deducting underwriting commissions, or upon the liquidation or
dissolution of the Company.
SECTION 13 -- RIGHTS AS A SHAREHOLDER. An Optionee or a transferee of an
---------------------------------------
Option shall have no rights as a shareholder with respect to any shares covered
by this Option until exercise thereof, except that each Optionee shall have the
right to receive a copy of the Company's audited financial statements (if
available) no later than 120 days following the end of each fiscal year of the
Company. No adjustment shall be made for dividends (Ordinary or extraordinary,
whether in cash, securities or other property) or distributions or other rights
of which the record date is prior to the exercise date, except as expressly
provided in Section 10.
SECTION 14 -- TERMINATION OF OPTIONS. Each Option granted under the Plan
-------------------------------------
shall set forth a termination date thereof, which date shall be not later than
ten years from the date such Option is granted. In any event all Options shall
terminate an expire upon the first to occur of the following events:
(a) the expiration of three months from the date of an Optionee's
termination of employment (other than by reason of death), except that if an
Optionee is then disabled (within the meaning of Section 22(e)(3) of the Code),
the expiration of one year from the date of such Optionee's termination of
employment; or
(b) the expiration of one year from the date of the death of an Optionee if
his or her death occurs while he or she is, or not later than three months after
he or she has ceased to be, employed by the Company or any of its subsidiaries
in a capacity in which he or she would be eligible receive grants of Options
under the Plan; or
(C) the termination of the Option pursuant to Section 10 of the Plan.
The termination of employment of an Optionee by death or otherwise shall
not accelerate or otherwise affect the number of shares to which an Option may
be exercised and such Option may only be exercised with respect to that number
of shares which could have been purchased under the Option had the Option been
exercised by the Optionee on the date of such termination.
SECTION 15 -- WITHHOLDING OF TAXES. The Company may deduct and withhold
------------------------------------
from the wages, salary, bonus and other compensation paid by the Company to the
Optionee the requisite tax upon the amount of taxable income, if any, recognized
by the Optionee in connection with the exercise in whole or in part of any
Option or the sale of Common Stock issued to the Optionee upon exercise of the
Option, all as may be required from time to time under any federal or state laws
and regulations. This withholding of tax shall be required from time to time
21
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under any federal or state tax laws and regulations. This withholding of tax
shall be made from the Company's concurrent or next payment of wages, salary,
bonus or other income to the Optionee or by payment to the Company by the
Optionee of required withholding tax, as the Option Committee may determine.
SECTION 16 -- EFFECTIVENESS AND TERMINATION OF PLAN. The Plan shall be
------------------------------------------------------
effective on the date on which it is adopted by the Board; provided, however,
(a) the Plan shall be approved by the shareholders of the Company within 12
months of such date of adoption by the Board, (b) no Option shall be exercised
pursuant to the Plan until the Plan has been approved by the shareholders of the
Company, and (c) no Option may be granted hereunder on or after that date which
is ten years form the effective date of the Plan. The Plan shall terminate when
all Options granted hereunder either have been fully exercised, and all shares
of Common Stock which may be purchased pursuant to the exercise of such Options
have been so purchased, or have expired; provided, however, that the Board may
in its absolute discretion terminated the Plan at any time. No such
termination, other than as provided for in Section 10 hereof, shall in any way
affect any Option then outstanding.
SECTION 17 -- AMENDMENT OF PLAN. The Board may (a) make such changes in
the terms and conditions of granted Options as it deems advisable, provided each
Optionee affected by such change consents thereto, and (b) make such amendments
to the Plan as it deems advisable. Such amendments and changes shall include,
but not be limited to, acceleration of the time at which an Option may be
exercised, but may not, without the written consent or approval of the holders
of a majority of that voting stock of the Company which is represented and is
entitled to vote at a duly held shareholders meeting (a) increase the maximum
number of shares subject to Options, except pursuant to Section 10 of the Plan
(b) decrease the Option Price requirement contained in Section 6 (except as
contemplated by Section 11) of the Plan (c) change the designation of the class
of employees eligible to receive Options (d) modify the limits set forth in
Section 3 of the Plan regarding the value of Common Stock for which any Optionee
may be granted Options, unless the provisions of Section 422(d) of the Code are
likewise modified or (e) in any manner materially increased the benefits
accruing to participants under the Plan.
BE IT RESOLVED:
The terms and conditions of this Stock Option Plan are accepted by the
Corporation on this 5st day of February 2007.
/S/ ANTHONY C. DIKE
- -------------------------
Anthony C. Dike
Director SEAL
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EXHIBIT 99.2
STOCK OPTION AGREEMENT
AGREEMENT, made this ____ day of ______, 2005, by and between
InterCare DX, Inc., a California corporation, hereinafter referred to as
the "Company" and , an individual, hereinafter referred to as
the "Optionee".
WITNESSETH:
WHEREAS, pursuant to the resolution adopted by the Board of Directors of the
Company, the Company has entered into a Employment Agreement with the Optionee
and, pursuant to the Agreement, the Company has agreed to grant to the Optionee
an Option to purchase shares of common stock of the Company at the prices per
share hereinafter set forth, such option to be for the term and upon the terms
and conditions hereinafter stated;
NOW THEREFORE, in good consideration of the promises, the mutual covenants
herein contained and other good and valuable consideration, the parties hereto
agree as follows:
1. OPTION. The Company hereby grants to the Optionee the right and option
-------
(hereinafter referred to as the "Option") to purchase all or any part of an
aggregate of _______ shares of common stock of the Company (hereinafter referred
to as the "Shares") on the terms and conditions herein set forth.
2. TERM. The term of the Option shall commence on the January 1, 2007 and
-----
shall expire Sixty (60) months from such date on September 1, 2012, save and
except that upon termination of the Agreement, the Option granted herein shall
cease and expire ninety (90) days from the date of terminating the Agreement.
3. PURCHASE PRICE. The purchase price of the Option shall be
----------------
______dollars ($XXXX.) the receipt and sufficiency of which is hereby
acknowledged. The Optionee has the right to purchase Shares in accordance
with the 2005 Stock Option Plan, which purchase price shall be payable in
full, in cash or note, upon exercise of the Option in accordance with the terms
and conditions here provided.
4. SECURITIES TO BE REGISTERED. Both the Option and the Shares covered by
the Option shall be "registered securities" as defined for the General Rules and
Regulations under the Securities Act of 1933, as amended (the "Act").
5. EXERCISE. The Option shall be exercisable in whole or in part at any
time and from time to time during the term of the Option by written notice
delivered to the Company at 900 Wilshire Boulevard, Suite 500, Los Angeles,
California 90017. The notice shall state the number of Shares with respect to
which the Option is being exercised, shall contain a representation and
agreement by the Optionee in form and substance substantially as set forth in
the Notice of Exercise, shall be signed by the Optionee and shall be accompanied
by payment. The Option shall not be exercised at any time when its exercise or
the delivery of the Shares referred to in the notice would be a violation of any
law, governmental regulation or ruling. The Option shall be exercisable only by
the Optionee.
6. ASSIGNMENT AND TRANSFER. The Option and the rights and obligations of
parties hereunder shall inure to the benefit of and shall be binding upon their
successors and assigns.
7. OPTIONEE AS SHAREHOLDER. Optionee shall have all rights as a shareholder
with respect to the Shares covered by the Option on and subsequent to the date
of issuance of a stock certificate or stock certificates to it. Adjustments
will be made for dividends or other rights with respect to which the record date
is on or subsequent to the date such stock certificates were issued.
8. ADJUSTMENTS FOR CHANGES IN CAPITAL STRUCTURE. In the event of a change
in the capital structure of the Company as a result of any stock dividend, stock
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split, combination or reclassification of shares, recapitalization or
consolidation of, the number of shares covered by the Option shall be
appropriately adjusted to ensure the same absolute benefit to the Optionee.
9. NOTICES. All notices required or permitted to be given under this
Agreement shall be sufficient if in writing and delivered or sent by registered
or certified mail to the principal office of each party.
10. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of California.
IN WITNESS WHEREOF, the parties have executed this instrument on the day and
year first written above.
ATTEST:
INTERCARE DX, INC.
By: /S/ ANTHONY C. DIKE
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ANTHONY C. DIKE
DIRECTOR
CHAIRMAN OF OPTION COMMITTEE
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