Table
of Contents


Index
to Financial Statements







UNITED
STATES
 SECURITIES
AND EXCHANGE COMMISSION
 Washington,
D.C. 20549
 
 FORM
10-K
  þ  ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
 
 For the
fiscal year ended  December 31,
2008
 
 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 0-12968
 
 INMEDICA
DEVELOPMENT CORPORATION
 (Exact
name of registrant as specified in its charter)
 
 Utah
                  87-0397815(State
      of Incorporation)
                  (I.R.S.
      Employer Identification
No.)
 
 3104
E. Camelback Road, Suite 242
 Phoenix,
Arizona 85016
 (Address
of principal executive offices)
  (480)
991-9500
 (Registrant’s telephone
number, including area code)
 Securities
      Registered Pursuant to Section 12(b) of the Act:None
  Securities
      Registered Pursuant to Section 12(g) of the Act:Title of Each Class
                    Name of Each Exchange on which
      RegisteredCommon
      Stock, $.001 par value
                    None
 Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act. Yes 
oNo þ
  Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Act. Yes 
oNo þ
  Table of Contents
 Index
to Financial Statements
 
 Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (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  þNo o
 
 Indicate
by check mark if disclosure of delinquent filers in response to Item 405 of
Regulation S-K is not contained herein, and will not be contained, to the best
of registrant’s knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K    o
  Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer or a smaller reporting
company.  See the definitions of “large accelerated filer,”
“accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the
Exchange Act:
  Large
      accelerated filer    o
                    Accelerated
      filer    o
                    Non-accelerated
      filer   o
                    Smaller
      reporting company    þ
  Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Act).    Yes  oNo þ
  State the
aggregate market value of the voting and non-voting common equity held by
non-affiliates:  $1,043,208 based on 8,693,402 non affiliate shares
outstanding at $.12 per share, which is the average bid and asked price of the
common shares as of the last business day of the registrant’s most recently
completed second fiscal quarter.
 
 Indicate
the number of shares outstanding of each of the issuer’s classes of common
stock, as of the latest practicable date: 18,629,493 shares of common stock,
$.001 par value, as of March 31, 2009.
  
 2
 Table of Contents
 Index
to Financial Statements
  INMEDICA DEVELOPMENT CORPORATION
  ANNUAL
REPORT ON FORM 10-K
  TABLE
OF CONTENTS
  PageForward-Looking
      Statements
                
                4PART
1Item
    1.
                Business
                
                5Item
    1A.
                Risk
      Factors
                
                10Item
    1B.
                Unresolved Staff
      Comments
                
                10Item
    2.
                Properties
                
                10Item
    3.
                Legal
      Proceedings
                
                11Item
    4.
                Submission of Matters to a Vote
      of Security Holders
                
                11PART
    IIItem
    5.
                Market for
      Registrant’s Common Equity, Related Stockholder Matters and
      Issuer Purchases of Equity Securities
                
                11Item
    6.
                Selected Financial
      Data
                
                12Item
    7.
                Management’s Discussion
      and Analysis of Financial Condition and Results of
      Operations
                
                13Item
    7A.
                Quantitative and Qualitative
      Disclosures About Market Risk
                
                14Item
    8.
                Financial Statements and
      Supplementary Data
                
                14Item
    9.
                Changes in and Disagreements
      with Accountants on Accounting and Financial
      Disclosure
                
                36Item
      9A(T).
                Controls and
      Procedures
                
                36Item
    9B.
                Other
      Information
                
                37PART
      IIIItem
    10.
                Directors, Executive Officers
      and Corporate Governance
                
                37Item
    11.
                Executive
      Compensation
                
                41Item
    12.
                Security Ownership of Certain
      Beneficial Owners and Management and Related Stockholder
      Matters
                
                42Item
    13.
                Certain Relationships and
      Related Transactions and Director Independence
                
                44Item
    14.
                Principal Accountant Fees and
      Services
                
                44PART
      IVItem
    15.
                Exhibits and Financial
      Statement Schedules
                
                45Signatures
                
                47
  3
 Table of Contents
 Index
to Financial Statements


FORWARD-LOOKING STATEMENTS
  This
Annual Report on Form 10-K (“Annual Report”) contains forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, and should be read in conjunction with the Financial Statements of
InMedica Development Corporation (the “Company” or “InMedica”).  Such
statements are not historical facts and reflect our current views regarding
matters such as operations and financial performance. In general,
forward-looking statements are identified by such words or phrases as “expects,”
“anticipates,” “believes,” “could,” “approximates,” “estimates,” “may,”
“intends,” “predicts,” “projects,” “plans,” or “will,” or the negative of those
words or other terminology. These
statements are not guarantees of future performance and involve certain 
known and unknown inherent risks, uncertainties and other factors that are
difficult to predict;our actual results could differ materially from
those expressed in these forward-looking statements, including those risks and
other factors described elsewhere in this Annual Report.  The
cautionary factors, risks and other factors presented should not be construed as
exhaustive.   Other risks not presently known to us, or that we
currently believe are immaterial, could also adversely affect our business,
financial condition or results of operations.
  Each forward-looking statement
should be read in context with, and with an understanding of, the various
disclosures concerning our business made elsewhere in this Annual Report, as
well as other public reports filed by us with the United States Securities and
Exchange Commission. Readers should not place undue reliance on any
forward-looking statement as a prediction of actual results of developments.
Except as required by applicable law or regulation, we undertake no obligation
to update or revise any forward-looking statement contained in this Annual
Report.





4
 Table of Contents
 Index
to Financial Statements




PART I




ITEM
      1.
            BUSINESS




General
  InMedica
Development Corporation (“InMedica” or the “Company”) was incorporated as a Utah
corporation on June 16, 1983.  In 1985, the Company acquired MicroCor,
Inc., a Utah corporation (“MicroCor”), engaged in the development of certain
medical technology products.  During the last fiscal year, MicroCor, a 57%
owned subsidiary of the Company, continued to engage in research and development
on MicroCor’s hematocrit technology (see “Product Development” below) pursuant to the Joint Development Agreement
(the “Agreement”) with Wescor, Inc. (“Wescor”).   Wescor assumed
day-to-day management of MicroCor as of September 7, 2004; however, InMedica has
the right to appoint three of five directors of MicroCor.  Since
December 30, 2008, the day-to-day management was transferred to three of
MicroCor’s directors:  Larry Clark, Ralph Henson and Richard
Bruggeman.  InMedica and MicroCor received no revenues from operations
during the last fiscal year.  (See “Item 7.  Management’s Discussion and
Analysis of Financial Condition and Results of Operations -Results of Operations” below).
 
 Principal
Products
  During
the years 1986 and 1987, MicroCor developed, manufactured and marketed a
portable electrocardiograph (“ECG”) monitor. About 450 units were manufactured
and sold. In July 1989, MicroCor signed a research and development contract with
Critikon (a predecessor to Johnson & Johnson Medical, Inc.) to develop a
medical instrument which would incorporate and enhance the technologies already
developed in the MicroCor portable ECG monitor and combine them with
technologies developed by Critikon. The research and development portion of the
contract was completed in July 1990, and resulted in the design of a new product
line. The product line was successfully marketed by Johnson & Johnson
Medical, Inc. during the 1990’s, providing royalty income to
InMedica.  The product line has now been phased out and the royalty
income has ceased.
 
 Product
Development
  For the
past 19 years, the Company has conducted research or engaged in fund raising to
support research and development of a method for measuring hematocrit
non-invasively (without drawing blood) and has applied for patents covering this
technology. Hematocrit is the percentage of blood volume made up by red blood
cells and is a common laboratory test performed invasively by drawing a blood
sample from the patient.   During May 1997, the Company employed
Dr. Gail Billings, a bio-medical researcher and, effective August 29, 1997, the
Company engaged Medical Physics, Inc., a biomedical research company located in
Salt Lake City, Utah, to conduct further research and development on the
project. The researchers engaged in additional research through 1998. During
1999, the researchers completed production of a transportable prototype device
for use in demonstrating the technology.  During 2001, the Company
entered into a Development, Licensing and Manufacturing Agreement with Chi Lin
Technologies Co., Ltd. for further development of the technology, which has now
been superseded by the Agreement with Wescor.   To date the
research and development of MicroCor, its various engineers, affiliates and
contractors has not completed a prototype suitable for
commercialization.  The Company believes the Wescor prototype has been
designed and constructed to meet the regulatory requirements for clinical trials
which may be required to obtain regulatory approval for marketing, however, the
Company’s
view is that while the design and construction may meet regulatory requirements,
there is no certainty that the device would perform with the accuracy needed for
approval.
 
 5
 Table of Contents
 Index
to Financial Statements
  Government
Regulation
  Medical
products may be subject to regulation by the Food and Drug Administration (the
“FDA”)
pursuant to the Federal Food, Drug and Cosmetic Act and other federal and state
laws regarding the regulation, manufacture and marketing of products in which
InMedica may be involved. The laws of foreign nations may also apply to any
international marketing of such products. To the extent InMedica has acquired or
developed an interest in medical products or the companies manufacturing such
products, InMedica’s business may be indirectly affected by such regulation.
Testing of MicroCor’s non-invasive hematocrit technology is subject to prior
approval and supervision of an Internal Review Board of a medical facility
overseeing the testing. Marketing of any new product line that might be
developed based on the Company’s non-invasive hematocrit device would be subject
to prior approval by the FDA.
 
 The
disclosure on the facing sheet of this Form 10-K that the Company is not a
“shell company” as defined in Rule 12b-2 of the Rules of the Securities Exchange
Act of 1934 (the “Exchange Act”), is
based on the Company’s conclusion that it has more than “nominal operations” as
described in Rule 12b-2.   The Company’s operations consist of
ongoing operating expenses reported in its statement of operations, paid
employees, a stated business purpose of development of the hematocrit
technology, a history of pursuing this purpose, a past history of revenues from
operations and ongoing research and development conducted by its majority-owned
subsidiary, MicroCor, Inc.    In the event the Company were
determined to be a “shell company,” it would be precluded from using Form S-8 to
register securities issued to employees and would be required to make certain
disclosures on Form 8-K regarding any transaction that causes it to cease being
a shell company.  Such disclosures consist of filings with the
Securities and Exchange Commission of the same type of information that would be
required to be filed in registering a class of securities under the Exchange
Act.   Examples of transactions that could cause a company to
cease to be a shell company include a “reverse acquisition” or “back door
registration” of a “shell company” with an operating company.  The
effect of such disclosure requirement is to increase the disclosure requirements
for the non-reporting or non-registered company in a “reverse acquisition” or
“back door registration” as more fully described in SEC Release Nos. 33–8587 and
34–52038.  The Company has no present plans or commitments to engage
in a “reverse acquisition,” “back door registration” or similar transaction or
to register stock on Form S-8.  The
Company has developed a plan to form and fund a new subsidiary, ValuMobile, LLC.
(See “Option Agreements” and “Subsequent Events”
below.)
 
 Patents
  As of
December 12, 1995, the Company’s application for a patent entitled “Method and
Apparatus for Non-Invasively Determining Hematocrit,” was allowed by the U.S.
Patent Office and the Patent issued on June 18, 1996 with a term of 17 years.
The Company was also issued an additional patent that claims priority from
October 4, 1990, the date of filing of the Company’s “Method and Apparatus for
Non-Invasively Determining Hematocrit.”  The patent term runs from
October 4, 1990 for a period of 17 years and expired on October 4,
2007.   As of October 3, 2000, the Company was issued a third
patent called “System and Method for In-Vivo Hematocrit Measurement Using
Impedance and Pressure Plethysmography.”   In December 2003, the
Company received a Notice of Allowance of Claim from the U.S. Patent and
Trademark office.   On July 20, 2004, MicroCor was issued a
fourth patent: Patent 6,766,191, “System And Method For In-Vivo Hematocrit
Measurement Using Impedance And Pressure Plethysmography.”   All
of the Company’s patents are now owned by MicroCor, pursuant to the Agreement
with Wescor.
 
 6
 Table of Contents
 Index
to Financial Statements
  Raw
Materials
  Materials
and electronic components used in the production and development of a hematocrit
measuring device and like products are components readily available through
various suppliers.
 
 Competition
  InMedica
is not presently a significant competitive factor in the medical products
industry. The medical products industry is dominated by large and
well-established corporations with vastly greater financial and personnel
resources than those of InMedica. There can be no assurance that the product in
which InMedica has an interest will be successfully developed and able to
compete profitably in the marketplace. Further, there is no assurance that
MicroCor and Wescor will be able to complete research, development and marketing
of MicroCor’s hematocrit technology in advance of any competitors that may
be developing competing technologies.
 
 Research and
Development Costs
  Research
and development costs for the two years ended December 31, 2008 and 2007 were $0
and $0, respectively.   The absence of research and development
costs of the Company in 2008 and 2007 was the result of the assumption of
research and development by Wescor pursuant to the Joint Development
Agreement.  None of the expenses were incurred on customer-sponsored
research activities relating to the development of new products.
 
 Employees
  InMedica
had no employees as of December 31, 2008.
  Option Agreements
  Chi
Lin Agreement
  On September
10, 2008, Chi Lin Technologies Co., Ltd. (“Chi
Lin”),
an entity of the Republic of China, granted a one-year option to
Synergistic Equities Ltd., a Belize corporation (“Synergistic”),
to purchase 6,043,704 issued and outstanding shares of common stock of the
Company currently owned by Chi Lin and 425,000 shares of common stock currently
owned by Chi Lin in MicroCor, Inc., a Utah corporation (“MicroCor”),for
the aggregate sum of $107,000 US (the “Synergistic Option”).  The agreement
with Chi Lin is hereinafter referred to as (the “Chi
Lin Agreement”).
The Company owns 57% of the issued and outstanding stock of
MicroCor.  If all 6,043,704 shares of common stock of the Company were
purchased pursuant to the Synergistic Option, Synergistic would own 32.4% of the
Company’s issued and outstanding shares of common stock.
 7
 Table of Contents
 Index
to Financial Statements
 In
connection with the grant of the Synertistic Option, Chi Lin granted to Larry
Clark, Ralph Henson and Richard Bruggeman, the former executive officers and
Directors of the Company (see “Change in
Control” below), and the survivors or survivor of them, with full power
of substitution, for a period of one year, an irrevocable proxy empowering
Clark, Henson and Bruggeman to unanimously vote the InMedica shares held by Chi
Lin in any vote on a proposed merger or acquisition with x-Mobility, Ron
Conquest, and/or affiliates.  Use of the proxy is limited to use at any
shareholders’ meeting or any consent resolution of the shareholders of InMedica
that may be necessary or recommended by counsel to approve a merger or
acquisition transaction between InMedica and Synergisitc and/or its affiliates,
including Ron Conquest, x-Mobility and/or others.  The Synergistic Option
expires on September 10, 2009.
  SNG
Agreement
  On
December 8, 2008, the Company entered into a stock purchase option
agreement with SNG Consulting, LLC, an Arizona limited liability company
(“SNG”).  The agreement with SNG is hereinafter referred to as (the
“SNG Agreement”).  Pursuant
to the terms of the SNG Agreement,
the Company granted to SNG a
one-year option to purchase up to 5,000,000 restricted shares of Company’s
common stock at a purchase price of $0.01 per share (the “SNG
Option”).  The SNG Agreement is transferable by SNG.  As
consideration for the SNG Agreement, SNG transferred to the Company 100%
ownership of ValuMobile, LLC, a Nevada limited liability
company (“ValuMobile”). ValuMobile was newly formed at the time
the SNG Agreement was entered into by the Company.  The SNG Agreement
further provides that SNG and any of its affiliates shall not collectively
acquire more than 88% of the outstanding common stock of the Company until such
time as the Company or ValuMobile has been funded with at least
$1,500,000.  The SNG Option expires on December 31,
2009.
 The
sole member of SNG is Ashley Conquest, the daughter of Ronald Conquest. 
Mr. Conquest is the new Chairman of the Board and Chief Executive Officer of the
Company (see, “Change in Control”
below).  Ashley Conquest and Ronald Conquest serve as the co-managers
of ValuMobile.
 LI
Agreement
  On
December 8, 2008, the Company entered into a stock purchase option
agreement with Law Investments CR, S.A., a Costa Rica corporation
(“LI”). The agreement with LI is hereinafter referred to as (the “LI Agreement”). 
Pursuant to the terms of the LI Agreement,the Company granted to LI a
one-year option to purchase up to 15,000,000 restricted shares of the Company’s
common stock at a purchase price of $0.0075 per share (the “LI
Option”).The
LI Agreement is transferable by LI. The LI Agreement provides that the first
$75,000 received from the purchase of Company’s common stock pursuant to the LI
Agreement shall be distributed to Company’s wholly-owned subsidiary, ValuMobile,
as a contribution to capital.  The LI Agreement further provides that
LI and any of its affiliates shall not collectively acquire more than 88% of the
outstanding common stock of the Company until such time as the Company or
ValuMobile has been funded with at least $1,500,000.  The LI Option expires
on December 31, 2009.  Ronald Conquest, who is the new Chairman of the
Board and Chief Executive Officer of the Company (see, “Change in Control” below), is a director and
President of LI.
  8
 Table of Contents
 Index
to Financial Statements
  Subsequent
Events
  Agreement with MicroCor,
Inc.




On
January 30, 2009, the Company entered into an agreement with MicroCor, LI
and SNG (the “MicroCor
Agreement”). In the
MicroCor Agreement, the parties agreed that the Company, LI, and SNG will vote
their respective ownership interest in MicroCor, if any, for the election of
Larry E. Clark, Ralph Henson, and Richard Bruggeman, the three former Directors
of Company (see, “Change in
Control” below), as Directors of MicroCor.  The MicroCor
Agreement also provides for the Company to create a class of preferred stock,
without dividend or voting rights, which will receive 100% of any future benefit
from the sale, spin off, merger or liquidation of MicroCor or the
commercialization of its hematocrit technology (the “Series B Preferred
Stock”).  The shares of the Series B Preferred Stock will be
distributed as a dividend, subject to compliance with federal and state
securities laws and regulations, to the Company’s common stockholders, as of the
record date of January 30, 2009.  The MicroCor Agreement also provides
that the MicroCor Board of Directors shall have sole discretion to reach
agreements and settlements with creditors and shareholders of MicroCor,
including the Company, without the consent of the Company’s Board of Directors
as then constituted.  These settlements and agreements may be in the
best interest of MicroCor and the holders of the Series B Preferred Stock, and
not necessarily the Company.  The term of the MicroCor Agreement and
the Series B Preferred Stock is the later of:  (i) two years
commencing on January 30, 2009; (ii) the resolution of the MicroCor Board to
abandon further development of the hematocrit technology; or (iii) the spin off,
merger or liquidation of MicroCor or its hematocrit
technology.
 Change in Control
 Resignations of Directors and Officers; Appointment
of New Directors and Officers
 Effective
January 30, 2009, Larry E. Clark, Ralph Henson and Richard Bruggeman resigned
Directors of the Company.  Further, Mr. Clark resigned as Chairman of
the Company, Mr. Henson resigned as President and Chief Executive Officer of the
Company, and Mr. Bruggeman resigned as Secretary/Treasurer and Chief Financial
Officer of the Company, all effective January 30, 2009.  There were no
disagreements between Mr. Clark, Mr. Henson, Mr. Bruggeman and the
Company.
  Effective
January 30, 2009, Ronald Conquest, Wayne R. Myers, and Christopher R. Miller
were appointed as Directors of the Company.  Additionally, Mr.
Conquest was appointed as Chairman and Principal Executive Officer, Mr. Myers
was appointed as President and Principal Operating Officer, and Mr. Miller was
appointed as Secretary/Treasurer and Principal Financial
Officer.  There are no family relationships between
Messrs.  Conquest, Myers and Miller.
 With
the resignation of the Company’s three Directors and officers and the
appointment of three new Directors and officers, control of the
Company has changed.
 9
 Table of Contents
 Index
to Financial Statements
  Potential Exercise of
Options
  Currently,
the Company has 18,629,493 shares of common stock issued and
outstanding.  If all 20,000,000 shares of common stock are purchased
by LI and SNG pursuant to the LI Agreement and the SNG Agreement (see “Option Agreements - LI Agreement” and “SNG Agreement” above), LI and SNG would own a
total of 51.8% of the Company’s issued and outstanding shares of common
stock.
  If
LI purchases all 15,000,000 shares available to be purchased pursuant to the LI
Agreement and SNG purchases no shares pursuant to the SNG Agreement, LI would
own 44.6% of the Company’s outstanding shares of common stock.
  If
SNG purchases all 5,000,000 shares available to be purchased pursuant to the SNG
Agreement and LI purchases no shares pursuant to the LI Agreement, SNG would own
21.2% of the Company’s outstanding shares of common stock.
  In
the event all options are exercised, Synergistic, SNG and LI would
collectively own 67.4% of Company’s issued and outstanding shares of common
stock.  Ronald Conquest, who is the new Chairman of the Board and
Chief Executive Officer of the Company (see “Resignations of Directors and Officers; Appointment
of New Directors and Officers” above), has served as
an agent for Synergistic, but is not an officer, director or shareholder of
Synergistic.
  ValuMobile Operations
  The
ability of the Company to commence operations in its new ValuMobile subsidiary
has been hampered in 2009 by the recent economic recession. The Company’s future
operations in its ValuMobile subsidiary will be dependent upon securing the
funding contemplated by the LI Agreement and the SNG Agreement.  At
the present time the Company has entered into no agreement or understanding to
obtain such funding.


ITEM
    1A.
              RISK FACTORS
  Not applicable.
  ITEM
      1B.
              UNRESOLVED STAFF
      COMMENTS
  Not
applicable.
  ITEM
      2.
              PROPERTIES




During
the 2008 fiscal year, the Company leased office space on a month-to-month basis
located at 825 North 300 West, Suite N132, in Salt Lake City, Utah. Commencing
in February 2009, the Company moved its offices to 3104 E. Camelback Road, Suite
242, Phoenix, Arizona 85016.  The Company currently pays no rent to
occupy this space.




10
 Table of Contents
 Index
to Financial Statements


ITEM
      3.
              LEGAL
      PROCEEDINGS
  The
Company is not currently a party to any pending lawsuit or legal
proceeding.
  ITEM
      4.
              SUBMISSION OF MATTERS TO A VOTE
      OF SECURITY HOLDERS
  The
Company did not submit any matters to a vote of security holders in the fourth
quarter of fiscal 2008.
   PART
II
 
 ITEM
      5.
              MARKET FOR REGISTRANT’S COMMON
      EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY
      SECURITIES
 Market Information
  The
common stock of InMedica is traded in the over-the-counter market and is quoted
on the “FINRA OTC Bulletin Board.” The table below sets forth, for the calendar
quarters indicated, the high and low closing bid prices for the InMedica common
stock as reported by the FINRA OTC Bulletin Board. These quotations represent
prices between dealers without adjustment for retail markups, markdowns or
commissions and may not represent actual transactions.
  Bid
      PriceQuarter
      Ended
                              
                              High
                              
                              
                              LowMarch
      31, 2007
                              
                              $
                              .23
                              
                              
                              $
                              .15June
      30, 2007
                              
                              
                              .17
                              
                              
                              
                              .10September
      30, 2007
                              
                              
                              .17
                              
                              
                              
                              .10December
      31, 2007
                              
                              
                              .13
                              
                              
                              
                              .06March
      31, 2008
                              
                              
                              .0667
                              
                              
                              
                              .0467June
      30, 2008
                              
                              
                              .0333
                              
                              
                              
                              .0167September
      30, 2008
                              
                              
                              .02
                              
                              
                              
                              .02December
      31, 2008
                              
                              
                              .0167
                              
                              
                              
                              .01
  11
 Table of Contents
 Index
to Financial Statements
 Stockholders
  On March
5, 2009, there were approximately 519 record holders of the InMedica common
stock. Such record holders do not include individual participants in securities
position listings.
  Dividends
  InMedica
has not paid cash dividends on its common stock since
organization.  For the foreseeable future, InMedica expects that
earnings, if any, will be retained for use in the business or be used to retire
obligations of the Company.
  Series A Preferred
Stock
  Four
stockholders own an aggregate of 21,016 shares of the Company’s Series A
Preferred Stock, which is 8% convertible preferred.  There is no
public market for the Series A Preferred Stock.   Aggregate
accumulated annual dividends payable on the preferred stock as of December 31,
2008 were $56,743.
  Securities Authorized for Issuance -
Series B Preferred Stock
  “Item 1. Business - Subsequent
Events”
 ITEM
      6.
                    SELECTED FINANCIAL
      DATA
    12
 Table of Contents
 Index
to Financial Statements
  ITEM
      7.
                          MANAGEMENT’S DISCUSSION AND
      ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
      OPERATIONS
  Plan of
Operation
 During
the 12 months beginning January 2008, the Company’s plan of operation was to
continue to work cooperatively with MicroCor and Wescor in the development of
the Company’s portable hematocrit device.  However, Wescor advised the
Company and Chi Lin that its parent corporation was interested in shifting
Wescor’s resources previously dedicated to the research and development of the
hematocrit technology to other projects.  As a result, Wescor ceased
all research and development efforts on the hematocrit
technology.  Wescor continues to be interested in bringing on a
new partner to continue the research and development or perhaps in selling its
interest in the Technology.  The Company is presently discussing the
matter with Wescor.   No present plans or commitments for other
alternatives have been made.  During 2008, the Company funded
administrative operations with the proceeds of minimum royalty payments from
MicroCor and from loans from the Company’s officers and directors.Wescor, in the past, has
loaned MicroCor sufficient funds to enable MicroCor to pay one half of the
minimum royalty.  These minimum payments to the Company from MicroCor
have ceased.  Payment of the balance of the minimum royalty was
deferred by the Company.  The Company has in the past borrowed from
affiliates; however, such borrowing is not expected to be available in the
future to meet obligations or to fund research and development. In past years,
salaries of employees and consulting fees have been accrued and later settled by
the issuance of restricted stock. If necessary, InMedica will also look for
other funding sources.
  Results of
Operations
  The
Company had an accumulated deficit of $9,042,965 as of December 31,
2008.  No revenues from operations were received in 2008 and
2007.  No revenues from operations are expected during
2009.    The Company had a net loss from operations of
$348,860 for the year ended December 31, 2008, compared to a net loss from
operations of $194,699 for the year ended December 31, 2007.  The
increase in net loss from operations resulted primarily from the issuance of
stock options to LI and SNG during September 2008, which generated an increase
compensation expense.
 Liquidity and
Capital Resources
  The
minimum royalty payments in 2008 and 2007 and loans from the Company’s officers
and directors have provided minimum operating capital to the
Company.  During 2008, the Company’s CEO and CFO deferred payments of
$2,000 per month in salary.  These deferrals ended December 31,
2008.
 
 During
the years 2008 and 2007, liquidity was generated by borrowings from Wescor, the
Company’s officers and directors and from the payment of minimum royalties to
InMedica by MicroCor.   The Company may need to engage in fund
raising during 2009 in order to meet future cash needs.
  13
 Table of Contents
 Index
to Financial Statements
 Subsequent Event
  ValuMobile
Operations
  The
ability of the Company to commence operations in its new ValuMobile subsidiary
has been hampered in 2009 by the recent economic recession. The Company’s future
operations in its ValuMobile subsidiary will be dependent on securing the
funding contemplated by the LI Agreement and the SNG Agreement.  At
the present time the Company has entered into no agreement or understanding to
obtain such funding.
  ITEM
      7A.
                  QUANTITATIVE AND QUALITATIVE
      DISCLOSURES ABOUT MARKET
RISK
  Not
applicable.
   ITEM
      8.
                  FINANCIAL STATEMENTS AND
      SUPPLEMENTARY DATA
 INMEDICA DEVELOPMENT CORPORATION
  INDEPENDENT
REGISTERED PUBLIC ACCOUNTANTS’ REPORT
 DECEMBER
31, 2008 AND 2007
  INDEX
TO FINANCIAL STATEMENTS
 PageIndependent Registered Public Accountants’
      Report
                      15Consolidated Balance Sheets as of December 31, 2008
      and 2007
                      17Consolidated
      Statements of Operations for theYears Ended December 31, 2008 and
      2007
                      18Consolidated
      Statements of Stockholders’ Equity for theYears Ended December 31,
      2008 and 2007
                      19Consolidated
      Statements of Cash Flows for theYears Ended December 31, 2008 and
      2007
                      20Notes to Consolidated Financial
    Statements
                      21
 
 
 14
 Table of Contents
 Index
to Financial Statements
  Robison, Hill & Co.
                    
                    
                    
                    Certified
      Public AccountantsA
      PROFESSIONAL CORPORATIONBrent
      M. Davies, CPADavid
      O. Seal, CPAW.
      Dale Westenskow, CPABarry
      D. Loveless, CPAStephen
      M. Halley, CPA
 INDEPENDENT
REGISTERED PUBLIC ACCOUNTANTS’ REPORT
 
  To the
Board of Directors and Stockholders of
 InMedica
Development Corporation
  We have
audited the accompanying consolidated balance sheets of InMedica Development
Corporation and subsidiary (the “Company”) as of December 31, 2008 and 2007, and
the related consolidated statements of operations, stockholders’ equity, and
cash flows for the two years then ended (all expressed in U.S.
dollars).  These financial statements are the responsibility of the
Company’s management.  Our responsibility is to express an opinion on
these financial statements based on our audit.
  We
conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States).  Those standards require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement.  The
Company is not required to have, nor were we engaged to perform, an audit of its
internal control over financial reporting.  Our audit included
consideration of internal control over financial reporting as a basis for
designing audit procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness of the company’s
internal control over financial reporting.  Accordingly, we express no
such opinion.  An audit also includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation.  We believe that our audit provides a reasonable basis
for our opinion.
  In our
opinion, such financial statements present fairly, in all material respects, the
financial position of the Company as of December 31, 2008 and 2007, and the
results of its operations and its cash flows for the two years then ended in
conformity with accounting principles generally accepted in the United States of
America.
     
 MEMBERS OF
AMERICAN INSTITUTE OF CERTIFIED PUBLIC
ACCOUNTANTS
 MEMBERS OF
THE SEC PRACTICE SECTION and THE PRIVATE COMPANIES PRACTICE
SECTION
  1366 East
Murray-Holladay Road, Salt Lake City, Utah 84117-5050
 Telephone
801/272-8045, Facsimile 801/277-9942
 15
 Table of Contents
 Index
to Financial Statements
   The
accompanying consolidated financial statements for the years ended December 31,
2008 and 2007 have been prepared assuming that the Company will continue as a
going concern.  As discussed in Note 1 to the consolidated financial
statements, the Company’s recurring losses from operations raise substantial
doubt about its ability to continue as a going concern.  Management’s
plans concerning these matters are also described in Note 1.  The
consolidated financial statements do not include any adjustments that might
result from the outcome of this uncertainty.
 
 /s/ 
      Robison, Hill & Co.Certified
      Public Accountants
 Salt Lake
City, Utah
 April 7,
2009
 
 
 16
 Table of Contents
 Index
to Financial Statements
  INMEDICA DEVELOPMENT CORPORATION AND
SUBSIDIARY
 CONSOLIDATED
BALANCE SHEETS
 December
      31,
                      
                      
                      December
      31,2008
                      
                      
                      2007ASSETSCurrent
      AssetsCash
      & Cash Equivalents
                      
                      $
                      1,794
                      
                      
                      $
                      2,706Prepaid
      Expenses & Other
                      
                      
                      1,100
                      
                      
                      
                      200Total
      Current Assets
                      
                      
                      2,894
                      
                      
                      
                      2,906Equipment
      & Furniture, at Cost,Less
      Accumulated Depreciation of $255,221and
      $254,856, respectively
                      
                      
                      –
                      
                      
                      
                      365TOTAL
      ASSETS
                      
                      $
                      2,894
                      
                      
                      $
                      3,271LIABILITIES
      & STOCKHOLDER'S EQUITYCurrent
      LiabilitiesRelated
      Party Consulting Fees Payable
                      
                      $
                      –
                      
                      
                      $
                      78,000Accounts
      Payable
                      
                      
                      6,665
                      
                      
                      
                      5,503Accrued
      Interest
                      
                      
                      34,351
                      
                      
                      
                      16,495Related
      Party Royalty Payable
                      
                      
                      113,333
                      
                      
                      
                      73,333Related
      Party Note Payable
                      
                      
                      187,385
                      
                      
                      
                      –Note
      Payable
                      
                      
                      21,509
                      
                      
                      
                      –Preferred
      Stock Dividends Payable
                      
                      
                      56,743
                      
                      
                      
                      49,177Current
      Portion of Long-Term Debt
                      
                      
                      160,000
                      
                      
                      
                      140,000Total
      Current Liabilities
                      
                      
                      652,619
                      
                      
                      
                      283,125Long-Term
      Convertible Promissory Note
                      
                      
                      72,633
                      
                      
                      
                      60,617Total
      Liabilities
                      
                      
                      652,619
                      
                      
                      
                      423,125Minority
      Interest
                      
                      
                      (291,211
                      )
                      
                      
                      (192,611
                      )Stockholders'
      Equity (Deficit)Preferred
      Stock, 10,000,000 shares authorized; Series A cumulativeconvertible
      preferred stock, 8% cumulative, $4.50 par value,1,000,000
      shares designated, 21,016 shares outstanding (aggregateliquidation
      preference of $151,316)
                      
                      
                      94,573
                      
                      
                      
                      94,573Common
      Stock, $.001 par value: 40,000,000 shares authorized,18,629,493
      and 18,629,493.share outstanding
                      
                      
                      18,629
                      
                      
                      
                      18,629Additional
      Paid-in Capital
                      
                      
                      8,571,249
                      
                      
                      
                      8,426,839Accumulated
      Deficit
                      
                      
                      (9,042,965
                      )
                      
                      
                      (8,767,284
                      )Total
      Stockholders' Equity (Deficit)
                      
                      
                      (358,514
                      )
                      
                      
                      (227,243
                      )TOTAL
      LIABILITIES &  STOCKHOLDERS' EQUITY
                      
                      $
                      2,894
                      
                      
                      $
                      3,271
 The
accompanying notes are an integral part of these financial
statements.
 17
 Table of Contents
 Index
to Financial Statements
 INMEDICA DEVELOPMENT CORPORATION AND
SUBSIDIARY
 CONSOLIDATED STATEMENTS OF
OPERATIONS
 For
      the Years EndedDecember
      31,2008
                      
                      
                      2007ROYALTY
      REVENUES
                      
                      $
                      –
                      
                      
                      $
                      –OPERATING
      EXPENSESGeneral
      & Administrative
                      
                      
                      204,450
                      
                      
                      
                      194,699Compensation
      Expense from Stock Options
                      
                      
                      144,410
                      
                      
                      
                      –Research
      & Development
                      
                      
                      –
                      
                      
                      
                      –Total
      Operating Expense
                      
                      
                      348,860
                      
                      
                      
                      194,699LOSS
      FROM OPERATIONS
                      
                      
                      (348,860
                      )
                      
                      
                      (194,699
                      )OTHER
      INCOME (EXPENSE)Interest
      Income
                      
                      
                      –
                      
                      
                      
                      –Interest
      Expense
                      
                      
                      (17,855
                      )
                      
                      
                      (13,586
                      )Other
      Income
                      
                      
                      –
                      
                      
                      
                      –Total
      Other Income (Expenses), Net
                      
                      
                      (17,855
                      )
                      
                      
                      (13,586
                      )INCOME
      (LOSS) BEFORE MINORITY INTEREST
                      
                      
                      (366,715
                      )
                      
                      
                      (208,285
                      )MINORITY
      INTEREST
                      
                      
                      98,600
                      
                      
                      
                      99,250NET
      INCOME (LOSS)
                      
                      
                      (268,115
                      )
                      
                      
                      (109,035
                      )PREFERRED
      STOCK DIVIDENDS
                      
                      
                      (7,566
                      )
                      
                      
                      (7,566
                      )NET
      INCOME (LOSS) APPLICABLE TO COMMON STOCKHOLDERS
                      
                      $
                      (275,681
                      )
                      
                      $
                      (116,601
                      )NET
      INCOME (LOSS) PER COMMON SHARE (BASIC & DILUTED)
                      
                      $
                      (0.01
                      )
                      
                      $
                      (0.01
                      )WEIGHTED
      AVERAGE NUMBER OF COMMON SHARES OUTSTANDINGBASIC
                      
                      
                      18,629,493
                      
                      
                      
                      18,629,493DILUTED
                      
                      
                      18,661,017
                      
                      
                      
                      18,661,017
 The
accompanying notes are an integral part of these financial
statements.
 18
 Table of Contents
 Index
to Financial Statements
 INMEDICA DEVELOPMENT CORPORATION AND SUBSIDIARY
 CONSOLIDATED
STATEMENTS OF STOCKHOLDERS’ EQUITY
 FOR
THE YEARS ENDED DECEMBER 31, 2008 AND 2007
 AdditionalPreferred
      Stock
                        
                        
                        Common
      Stock
                        
                        
                        Paid-in
                        
                        
                        AccumulatedShares
                        
                        
                        Amount
                        
                        
                        Shares
                        
                        
                        Amount
                        
                        
                        Capital
                        
                        
                        DeficitBalance,
      January 1, 2007
                        
                        
                        21,016
                        
                        
                        $
                        94,573
                        
                        
                        
                        18,629,493
                        
                        
                        $
                        18,629
                        
                        
                        $
                        8,426,839
                        
                        
                        $
                        (8,650,683
                        )Common
      stock issued forConvertible
      promissory notes
                        
                        
                        –
                        
                        
                        
                        –
                        
                        
                        
                        –
                        
                        
                        
                        –
                        
                        
                        
                        –
                        
                        
                        
                        –Preferred
      stock dividends
                        
                        
                        –
                        
                        
                        
                        –
                        
                        
                        
                        –
                        
                        
                        
                        –
                        
                        
                        
                        –
                        
                        
                        
                        (7,566
                        )Net
      loss
                        
                        
                        –
                        
                        
                        
                        –
                        
                        
                        
                        –
                        
                        
                        
                        –
                        
                        
                        
                        –
                        
                        
                        
                        (109,035
                        )Balance,
      December 31, 2007
                        
                        
                        21,016
                        
                        
                        
                        94,573
                        
                        
                        
                        18,629,493
                        
                        
                        
                        18,629
                        
                        
                        
                        8,426,839
                        
                        
                        
                        (8,767,284
                        )Stock
      options
                        
                        
                        –
                        
                        
                        
                        –
                        
                        
                        
                        –
                        
                        
                        
                        –
                        
                        
                        
                        144,410
                        
                        
                        
                        –Preferred
      stock dividends
                        
                        
                        –
                        
                        
                        
                        –
                        
                        
                        
                        –
                        
                        
                        
                        –
                        
                        
                        
                        –
                        
                        
                        
                        (7,566
                        )Net
      loss
                        
                        
                        –
                        
                        
                        
                        –
                        
                        
                        
                        –
                        
                        
                        
                        –
                        
                        
                        
                        –
                        
                        
                        
                        (268,115
                        )Balance,
      December 31, 2008
                        
                        
                        21,016
                        
                        
                        $
                        94,573
                        
                        
                        
                        18,629,493
                        
                        
                        $
                        18,629
                        
                        
                        $
                        8,571,249
                        
                        
                        $
                        (9,042,965
                        )
 
 The accompanying notes are an integral
part of these financial statements.
  19
 Table of Contents
 Index
to Financial Statements
  INMEDICA DEVELOPMENT CORPORATION AND
SUBSIDIARY
 CONSOLIDATED STATEMENTS OF CASH
FLOWS
 For
      the Years EndedDecember
      31,2008
                      
                      
                      2007CASH
      FLOWS FROM OPERATING ACTIVITIES:Net
      Income (Loss)
                      
                      $
                      (268,115
                      )
                      
                      $
                      (109,035
                      )Adjustments
      to reconcile net loss to net cash used inoperating
      activities:Depreciation
      and amortization
                      
                      
                      365
                      
                      
                      
                      493Stock
      option compensation expense
                      
                      
                      144,410
                      
                      
                      
                      –Interest
      income from amortization or discount on notes receivable
                      
                      
                      –
                      
                      
                      
                      –Minority
      interest in losses
                      
                      
                      (98,600
                      )
                      
                      
                      (99,250
                      )Changes
      in assets and liabilities:Prepaid
      expenses
                      
                      
                      (900
                      )
                      
                      
                      –Related
      party consulting fees payable
                      
                      
                      24,000
                      
                      
                      
                      24,000Accounts
      payable
                      
                      
                      22,672
                      
                      
                      
                      5,503Accrued
      interest
                      
                      
                      17,855
                      
                      
                      
                      13,585Related
      party royalty payable
                      
                      
                      40,000
                      
                      
                      
                      40,000Accrued
      payroll and related taxes
                      
                      
                      48,000
                      
                      
                      
                      –Net
      cash used in operating activities
                      
                      
                      (70,313
                      )
                      
                      
                      (124,704
                      )CASH
      FLOWS FROM INVESTING ACTIVITIES:Purchase
      of equipment
                      
                      
                      –
                      
                      
                      
                      –Proceeds
      from note receivable
                      
                      
                      –
                      
                      
                      
                      –Net
      cash provided by (used in) investing activities
                      
                      
                      –
                      
                      
                      
                      –CASH
      FLOWS FROM FINANCING ACTIVITIES:Proceeds
      from notes payable
                      
                      
                      32,016
                      
                      
                      
                      93,331Proceeds
      from related party loans
                      
                      
                      37,385Payments
      on notes payable
                      
                      
                      –
                      
                      
                      
                      –Proceeds
      from sale of common stock
                      
                      
                      –
                      
                      
                      
                      –Net
      cash provided by (used in) financing activities
                      
                      
                      69,401
                      
                      
                      
                      93,331NET
      INCREASE IN CASH
                      
                      
                      (912
                      )
                      
                      
                      (31,373
                      )CASH
      AT BEGINNING OF THE YEAR
                      
                      
                      2,706
                      
                      
                      
                      34,079CASH
      AT END OF THE YEAR
                      
                      $
                      1,794
                      
                      
                      $
                      2,706SUPPLEMENTAL
      DISCLOSURE OF CASH FLOWCash
      paid during the year for interest
                      
                      $
                      –
                      
                      
                      $
                      –Cash
      paid during the year for income taxes
                      
                      $
                      200
                      
                      
                      $
                      200SUPPLEMENTAL
      SCHEDULE OF NONCASH INVESTING & FINANCING ACTIVITIESConvertible
      promissory notes exchanged for 500,000 shares of common
    stock
                      
                      $
                      –
                      
                      
                      $
                      –Sale
      of subsidiary stock for notes receivable
                      
                      $
                      –
                      
                      
                      $
                      –
  The
accompanying notes are an integral part of these financial
statements.
  20
 Table of Contents
 Index
to Financial Statements
 INMEDICA
DEVELOPMENT CORPORATION AND SUBSIDIARY
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 FOR
THE YEARS ENDING DECEMBER 31, 2008 AND 2007
  
 NOTE 1 - NATURE OF
OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES
 
 Nature of
Operations
  InMedica
Development Corporation ("InMedica") and its majority-owned subsidiary,
MicroCor, Inc. ("MicroCor") (collectively referred to as the "Company"),
historically have engaged in the research, development and sale of medical
technology and fund raising to support such activities.  During the
years 1986 and 1987, MicroCor developed and marketed a portable
electrocardiograph ("ECG") monitor and manufactured and sold about 450
units.  In July 1989, MicroCor signed a research and development
contract with Johnson and Johnson Medical, Inc.  ("Johnson and
Johnson") for further development of the ECG technology.  As a result
of the agreement, Johnson and Johnson manufactured and marketed a product line
under the name of Dinamap PlusTM which
incorporated the Company's ECG technology.  Royalties received from
Johnson and Johnson were the Company's sole source of revenue through the year
2000.  In 2001, Johnson and Johnson stopped manufacturing and
marketing the Dinamap PlusTM product
line; therefore, MicroCor no longer receives royalties from Johnson and
Johnson.
 
 Since 1989, the Company has engaged in
research and development of a device to measure hematocrit non-invasively (the
"Non-Invasive Hematocrit Technology" and/or the
“Technology”).  Hematocrit is the percentage of red blood cells in a
given volume of blood.  At the present time, the test for hematocrit
is performed invasively by drawing blood from the patient and testing the blood
sample in the laboratory.    The Hematocrit Technology is
owned by MicroCor, Inc., which is a 57% owned subsidiary of the
Company.   Other owners of the subsidiary are Wescor, Inc. (29%)
and   Chi Lin Technologies Company, Ltd. (14%).  The
Company has the right to appoint three of five directors of MicorCor and each of
the other owners has the right to appoint one director of
MicroCor.   To date the research and development of MicroCor, its
various engineers, affiliates and contractors, including Wescor, has not
completed a prototype suitable for
commercialization.  Commercialization of the Non-Invasive Hematocrit
Technology is dependent upon favorable testing, Food and Drug Administration
(“FDA”) approval, financing of further research and development and, if
warranted, financing of manufacturing and marketing activities.
 
 Basis of
Presentation
 
 The Company’s consolidated financial
statements have been prepared on a going concern basis, which contemplates the
realization of assets and satisfaction of liabilities in the normal course of
business.  The consolidated financial statements do not include any
adjustment relating to recoverability and classification of recorded amounts of
assets and liabilities that might be necessary should the Company be unable to
continue as a going concern.  The Company generated negative cash
flows from operations of $70,313 and $124,704 in 2008 and 2007, respectively, and
net losses from operations of $268,115 and $109,035 in 2008 and 2007,
respectively.   As of December 31, 2008 the Company had an
accumulated deficit of $9,042,965 and a stockholders’ deficit of $358,514. These
conditions raise substantial doubt as to the Company's ability to continue
as a going concern.  The Company's continued existence is dependent
upon its ability to execute its operating plan and to obtain additional debt or
equity financing.  There can be no assurance the necessary debt or
equity financing will be available, or will be available on terms acceptable to
the Company.  Management's operating plan includes pursuing additional
fund raising as well as research and development.
  21
 Table of Contents
 Index
to Financial Statements
  INMEDICA
DEVELOPMENT CORPORATION AND SUBSIDIARY
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 FOR
THE YEARS ENDING DECEMBER 31, 2008 AND 2007
 NOTE 1 - NATURE OF
OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES (Continued)
 
 Patents
 
 The Company has four patents covering
various aspects of its Technology which expire from 2007 to 2013.
 
 Principles of
Consolidation
 
 The consolidated financial statements
include the accounts of InMedica and MicroCor.   All material
inter-company accounts and transactions have been eliminated.
 
 On
December 12, 2008, the Company acquired 100% of the membership interests of
ValuMobile, LLC, a Nevada limited liability company in consideration of the
grant of a stock purchase option to SNG Consulting, LLC, an Arizona limited
liability company for purchase of the Company’s common
stock.  ValuMobile LLC is a newly formed limited liability company
with no operations at December 31, 2008.
 
 Income
Taxes
 
 The Company accounts for income taxes
using the asset and liability method. Deferred income taxes are determined based
on the estimated future tax effects of differences between the financial
reporting and tax reporting bases of assets and liabilities given the provisions
of currently enacted tax laws.  A valuation allowance is provided when
it is more likely than not that all or some portion of the deferred income tax
assets will not be realized.
  22
 Table of Contents
 Index
to Financial Statements
  INMEDICA
DEVELOPMENT CORPORATION AND SUBSIDIARY
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 FOR
THE YEARS ENDING DECEMBER 31, 2008 AND 2007
 NOTE 1 - NATURE OF
OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES(Continued)
 
 Equipment and
Furniture
  Equipment
and furniture are recorded at cost and depreciated using the straight-line
method over the estimated useful lives of the assets which range from three to
five years.
 
 Equipment
      and Furniture consist of the following:
                            
                            December
      31,2008
                            
                            
                            2007Equipment
                            
                            $
                            244,033
                            
                            
                            $
                            244,033Furniture
                            
                            
                            11,188
                            
                            
                            
                            11,188255,221
                            
                            
                            
                            255,221Less
      accumulated depreciation
                            
                            
                            (255,221
                            )
                            
                            
                            (254,856
                            )Total
                            
                            $
                            –
                            
                            
                            $
                            365
 
 Depreciation expense for the years
ended December 31, 2008 and 2007 was $365 and $493, respectively.
 
 Research and
Development
 
 Research and development costs are
expensed as incurred.
 
 Net Loss Per Common
Share
  Basic net
loss per common share is computed by dividing net loss by the weighted average
number of common shares outstanding during the year.  Diluted net loss
per common share ("Diluted EPS") reflects the potential dilution that could
occur if stock options or other common stock equivalents were exercised or
converted into common stock.  At December 31, 2008 and 2007,
respectively, there were 31,524 and 31,524 potentially dilutive common stock
equivalents.  The computation of Diluted EPS does not assume exercise
or conversion of securities that would have an anti-dilutive effect on net loss
per common share.
 
 Use of
Estimates
  The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and 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.
 
 23
 Table of Contents
 Index
to Financial Statements
  INMEDICA
DEVELOPMENT CORPORATION AND SUBSIDIARY
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 FOR
THE YEARS ENDING DECEMBER 31, 2008 AND 2007
 NOTE 1 - NATURE OF
OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES(Continued)
 
 Comprehensive
Income
 
 There are no components of
comprehensive income other than the net loss.
 
 Cash
Equivalents
  For the
purpose of reporting cash flows, the Company considers all highly liquid debt
instruments purchased with maturity of three months or less to be cash
equivalents to the extent the funds are not being held for investment
purposes.
 
 Concentration of Credit
Risk
  The
Company has no significant off-balance-sheet concentrations of credit risk such
as foreign exchange contracts, options contracts or other foreign hedging
arrangements.  The Company maintains the majority of its cash balances
with one financial institution, in the form of demand deposits.
 
 Fair Value of Financial
Instruments
  The
carrying value of the Company's financial instruments, including receivables,
accounts payable, accrued liabilities, and notes payable at December 31, 2008
and 2007 approximates their fair values due to the short-term nature of these
financial instruments.
  24
 Table of Contents
 Index
to Financial Statements
 INMEDICA
DEVELOPMENT CORPORATION AND SUBSIDIARY
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 FOR
THE YEARS ENDING DECEMBER 31, 2008 AND 2007
 NOTE 1 - NATURE OF
OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES(Continued)
 
 Recent Accounting
Standards
 
 In
February 2007, the FASB issued SFAS No. 159, "The Fair Value Option for
Financial Assets and Financial Liabilities" ("SFAS 159"). SFAS 159 provides
companies with an option to report selected financial assets and liabilities at
fair value. The objective of SFAS 159 is to reduce both complexity in accounting
for financial instruments and the volatility in earnings caused by measuring
related assets and liabilities differently. Generally accepted accounting
principles have required different measurement attributes for different assets
and liabilities that can create artificial volatility in earnings. The FASB has
indicated it believes that SFAS 159 helps to mitigate this type of
accounting-induced volatility by enabling companies to report related assets and
liabilities at fair value, which would likely reduce the need for companies to
comply with detailed rules for hedge accounting. SFAS 159 also establishes
presentation and disclosure requirements designed to facilitate comparisons
between companies that choose different measurement attributes for similar types
of assets and liabilities.  SFAS 159 does not eliminate disclosure
requirements included in other accounting standards, including requirements for
disclosures about fair value measurements included in SFAS 157 and SFAS No. 107,
"Disclosures about Fair Value of Financial Instruments." SFAS 159 is effective
for the Company as of the beginning of fiscal year 2008. The adoption of this
pronouncement is not expected to have an impact on the Company's financial
position, results of operations or cash flows.
 
 In
December 2007, the FASB issued No. 160, “Noncontrolling Interests in Financial
Statements, an amendment of ARB No. 51" (“SFAS 160").  SFAS 160 amends
ARB 51 to establish accounting and reporting standards for the noncontrolling
interest in a subsidiary and for the deconsolidation of a
subsidiary.  It clarifies that a noncontrolling interest in a
subsidiary is an ownership interest in the consolidated entity that should be
reported as equity in the consolidated financial statements.  This
Statement is effective for fiscal years beginning on or after December 15,
2008.  Early adoption is not permitted. Management is currently
evaluating the effects of this statement, but it is not expected to have any
impact on the Company’s financial statements.
 
 25
 Table of Contents
 Index
to Financial Statements
  INMEDICA
DEVELOPMENT CORPORATION AND SUBSIDIARY
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 FOR
THE YEARS ENDING DECEMBER 31, 2008 AND 2007
 NOTE 1 - NATURE OF
OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES(Continued)
 
 Recent Accounting Standards
(continued)
 
 In
December 2007, the FASB issued No. 141(R), “Business Combinations” (“SFAS
141(R)”.  SFAS 141(R) provides companies with principles and
requirements on how an acquirer recognizes and measures in its financial
statements the identifiable assets acquired, liabilities assumed, and any
noncontrolling interest in the acquiree as well as the recognition and
measurement of goodwill acquired in a business combination. SFAS 141(R) also
requires certain disclosures to enable users of the financial statements to
evaluate the nature and financial effects of the business combination.
Acquisition costs associated with the business combination will generally be
expensed as incurred. SFAS 141(R) is effective for business combinations
occurring in fiscal years beginning after December 15, 2008, which will require
the Company to adopt these provisions for business combinations occurring in
fiscal 2009 and thereafter. Early adoption of SFAS 141(R) is not
permitted.  Management is currently evaluating the effects of this
statement, but it is not expected to have any impact on the Company’s financial
statements.
 
 In March
2008, the FASB issued No. 161, “Disclosures about Derivative Instruments and
Hedging Activities, an amendment of FASB Statement No. 133.  (“SFAS
161").  SFAS 161 requires enhanced disclosures about an entity's
derivative and hedging activities and thereby improves the transparency of
financial reporting.  This Statement is effective for financial
statements issued for fiscal years and interim periods beginning after November
15, 2008, with early application encouraged. This Statement encourages, but does
not require, comparative disclosures for earlier periods at initial
adoption.  Management is currently evaluating the effects of this
statement, but it is not expected to have any impact on the Company’s financial
statements.
  26
 Table of Contents
 Index
to Financial Statements
 INMEDICA
DEVELOPMENT CORPORATION AND SUBSIDIARY
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 FOR
THE YEARS ENDING DECEMBER 31, 2008 AND 2007
 NOTE 2 - NOTES
PAYABLE
 
 Notes payable consisted of the
following:
 December
      31,
                      
                      
                      December
      31,2008
                      
                      
                      2007WesCor,
      Inc. Overhead Note,Due
      December 31, 2010 including interestat
      prime 4.00% at December 31, 2008Unsecured
      convertible at $.10 per share
                      
                      $
                      72,633
                      
                      
                      $
                      60,617WesCor,
      Inc. Secured Convertible Promissory Note,Due
      March 6, 2009 including interestat
      prime plus 2 6.00% at December 31, 2008Unsecured
      convertible at $.10 per share
                      
                      
                      160,000
                      
                      
                      
                      140,000Less
      Current Portion
                      
                      
                      (160,000
                      )
                      
                      
                      (140,000
                      )Total
      Long-Term Convertible Promissory Notes
                      
                      $
                      72,633
                      
                      
                      $
                      60,617
  On December 31, 2008, the Company
converted $21,509 of accounts payable due to its attorney into a promissory
note.  The note is due on demand and carries an interest rate of 6%
per annum.  This note is secured by the proceeds of option exercises
by SNG Consulting LLC pursuant to its option to acquire 5,000,000 shares of the
common stock of the Company, but only by such proceeds as correspond to
exercises after the initial minimum share purchase option exercise by Law
Investments.  In the event of such option exercise, such revenues
shall be applied first to the retirement of these notes.  (See Note
5).
 
 NOTE 3 - INCOME
TAXES
 
 Deferred income tax assets consisted of
the following:
 December
      31,
                      
                      
                      December
      31,2008
                      
                      
                      2007Net
      operating loss carryforwards
                      
                      $
                      793,931
                      
                      
                      $
                      760,884Future
      deductions temporary differences relatedto
      compensation, reserves, and accruals
                      
                      
                      5,821
                      
                      
                      
                      6,995Less
      valuation allowance
                      
                      
                      (799,752
                      )
                      
                      
                      (767,879
                      )Deferred
      income tax assets
                      
                      $
                      –
                      
                      
                      $
                      –
 
 The
valuation allowance increased $31,873 in 2008.  At December 31, 2008,
the Company has consolidated net operating loss carryforwards for federal income
tax purposes of $2,457,992.  These net operating loss carryforwards
expire at various dates beginning in 2009 through 2028.  Due to the
uncertainty with respect to ultimate realization, the Company has established a
valuation allowance for all deferred income tax assets.
 
 27
 Table of Contents
 Index
to Financial Statements
 INMEDICA
DEVELOPMENT CORPORATION AND SUBSIDIARY
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 FOR
THE YEARS ENDING DECEMBER 31, 2008 AND 2007
 NOTE 4 - COMMON STOCK
TRANSACTIONS
 
 During the last three years the Company
made the following sales of unregistered common stock in reliance upon Section
4(2) of the Securities Act of 1933:
 Date
                            
                            Shares
                            
                            Shareholder
                            
                            PriceOctober
      6, 2006
                            
                            150,000
                            
                            Dean
      A. Clark, Trustee
                            
                            $
                            15,000October
      6, 2006
                            
                            150,000
                            
                            David
      P. Martin
                            
                            $
                            15,000October
      6, 2006
                            
                            95,000
                            
                            Julie
      P. Cheney
                            
                            $
                            9,500October
      6, 2006
                            
                            95,000
                            
                            Lloyd
      A. Hardcastle
                            
                            $
                            9,500October
      6, 2006
                            
                            10,000
                            
                            Michael
      L. Schwab
                            
                            $
                            1,000
 NOTE 5 - STOCK
OPTIONS
 
 On
December 8, 2008, the Company entered into an option agreement with Law
Investments CR, S.A., a Costa Rica corporation, whereby the Company granted to
Law Investments a one-year option to purchase up to 15,000,000 restricted shares
of the Company’s common stock at a purchase price of $0.0075 per
share.  This agreement is transferable by Law
Investments.  The Law Investment agreement provides that the first
$75,000 received from the purchase of the Company’s common stock pursuant to the
Law Investment agreement shall be distributed to the Company’s wholly-owned
subsidiary, ValuMobile, LLC, a Nevada limited liability company as a
contribution to capital.  The Law Investment agreement further
provides that Law Investment and any of its affilitates shall not collectively
acquire more than 88% of the outstanding common stock of the Company until such
time as the Company or ValuMobile has been funded with at least
$1,500,000.  The sole member of SNG is Ashley Conquest, the daughter
of Ronald Conquest, who was appointed a Director and Officer of the Company on
January 30, 2009.
 
 On
December 8, 2008, the Company entered into an option agreement with SNG
Consulting, LLC, an Arizona limited liability company, whereby the Company
granted to SNG a one-year option to purchase up to 5,000,000 restricted shares
of the Company’s common stock at a purchase price of $0.01 per
share.  This agreement is transferable by SNG.  As
consideration for the SNG Agreement, SNG transferred to the Company 100%
ownership of ValuMobile.  ValuMobile was newly formed at the time the
SNG Agreement was entered into by the Company.  The SNG agreement
further provides that Law Investment and any of its affilitates shall not
collectively acquire more than 88% of the outstanding common stock of the
Company until such time as the Company or ValuMobile has been funded with at
least $1,500,000.  Ronald Conquest, who was appointed a Director and
Officer of the Company on January 30, 2009, is the President of Law
Investments.
 
 28
 Table of Contents
 Index
to Financial Statements
  INMEDICA
DEVELOPMENT CORPORATION AND SUBSIDIARY
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 FOR
THE YEARS ENDING DECEMBER 31, 2008 AND 2007
 NOTE 5 - STOCK OPTIONS
(Continued)
 
 The Black
Scholes option pricing model was used to calculate the fair value of the options
granted. During the year ended December 31, 2008, the Company recognized
compensation expense of $144,410 related to the stock options.  The
following assumptions were used in the fair value calculations:
 
 Risk free
rate – 0.53%
 Expected
term – 1 year
 Expected
volatility of stock – 202.6%
 Expected
dividend yield – 0%
 
 The
Company’s stock price at December 8, 2008 was $0.01.
 
 A summary
of this stock option activity for 2007 and 2008 was as follows:
 WeightedAverageOption
                      
                      
                      ExerciseShares
                      
                      
                      PriceOutstanding
      at January 1, 2007
                      
                      
                      –
                      
                      
                      $
                      –Granted
                      
                      
                      –
                      
                      
                      
                      –Forfeited
      or expired
                      
                      
                      –
                      
                      
                      
                      –Outstanding
      at December 31, 2007
                      
                      
                      –
                      
                      
                      
                      –Granted
                      
                      
                      20,000,000
                      
                      
                      
                      0.008125Forfeited
      or expired
                      
                      
                      –
                      
                      
                      
                      –Outstanding
      at December 31, 2008
                      
                      
                      20,000,000
                      
                      
                      $
                      0.008125
  The
following table summarizes information about stock options issued to
non-employees outstanding at December 31, 2008:
 
 Options
      Outstanding
                    
                    
                    Options
      ExercisableWeightedAverage
                    
                    
                    Weighted
                    
                    
                    
                    
                    
                    WeightedRange
      of
                    
                    
                    
                    
                    
                    Contractual
                    
                    
                    Average
                    
                    
                    
                    
                    
                    AverageExercise
                    
                    
                    Number
                    
                    
                    Life
                    
                    
                    Exercise
                    
                    
                    Number
                    
                    
                    ExercisePrices
                    
                    
                    Outstanding
                    
                    
                    (in
      years)
                    
                    
                    Price
                    
                    
                    Exercisable
                    
                    
                    Price$
                    0.0075
      – 0.01
                    
                    
                    
                    20,000,000
                    
                    
                    
                    1
                    
                    
                    $
                    0.008125
                    
                    
                    
                    20,000,000
                    
                    
                    
                    0.008125
  29
 Table of Contents
 Index
to Financial Statements
  INMEDICA
DEVELOPMENT CORPORATION AND SUBSIDIARY
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 FOR
THE YEARS ENDING DECEMBER 31, 2008 AND 2007
 NOTE 6 - PREFERRED
STOCK
  The
Company is authorized to issue 10,000,000 shares of preferred
stock.  The Company's board of directors designated 1,000,000 shares
of this preferred stock as Series A Cumulative Convertible Preferred Stock
("Series A Preferred") with a par value of $4.50 per share.  Holders
of the Series A Preferred receive annual cumulative dividends of eight percent,
payable quarterly, which dividends are required to be fully paid or set aside
before any other dividend on any class or series of stock of the Company is
paid.  As of December 31, 2008, cumulative preferred stock dividends
payable in the amount of $56,743, or $2.70 per share are due and
payable.  Holders of the Series A Preferred receive no voting rights
but do receive a liquidation preference of $4.50 per share, plus accrued and
unpaid dividends.  Series A Preferred stockholders have the right to
convert each share of Series A Preferred to the Company's common stock at a rate
of 1.5 common shares to 1 preferred share.
 
 NOTE 7 – EARNINGS PER
SHARE
 
 The following data show the amounts
used in computing earnings per share and the effect on income and the weighted
average number of shares of dilutive potential common stock:
 
 For
      the Years EndedDecember
      31,2008
                      
                      
                      2007Net
      Income (Loss)
                      
                      $
                      (268,115
                      )
                      
                      $
                      (109,035
                      )Less:
      preferred dividends
                      
                      
                      (7,566
                      )
                      
                      
                      (7,566
                      )Income
      (Loss) available to common stockholders used in basic EPS
                      
                      $
                      (275,681
                      )
                      
                      $
                      (116,601
                      )Convertible
      preferred stock
                      
                      
                      7,566
                      
                      
                      
                      7,566Convertible
      notes payable
                      
                      
                      –
                      
                      
                      
                      –Income
      (Loss) available to common stockholders after assumedConversion
      of dilutive securities
                      
                      $
                      (268,115
                      )
                      
                      $
                      (109,035
                      )Weighted
      average number of common shares used in basic EPS
                      
                      
                      18,629,493
                      
                      
                      
                      18,629,493Effect
      of dilutive securities:Convertible
      preferred stock
                      
                      
                      31,524
                      
                      
                      
                      31,524Convertible
      notes payable
                      
                      
                      –
                      
                      
                      
                      –Options
                      
                      
                      –
                      
                      
                      
                      –Weighted
      average number of common shares and dilutive potentialcommon
      stock used in diluted EPS
                      
                      
                      18,661,017
                      
                      
                      
                      18,661,017
 
 
 30
 Table of Contents
 Index
to Financial Statements
  INMEDICA
DEVELOPMENT CORPORATION AND SUBSIDIARY
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 FOR
THE YEARS ENDING DECEMBER 31, 2008 AND 2007
 NOTE8- RELATED PARTY
TRANSACTIONS
  The
Company has a consulting arrangement with an entity owned by the Company's
chairman whereby the Company agreed to pay $2,000 per month.  Either
party can terminate the arrangement at any time upon 30 days prior
notice.  Accrued but unpaid consulting fees do not bear
interest.  As of December 31, 2008, $102,000 was owed under the
arrangement.  On December 31, 2008, the Company converted this
$102,000 of accrued consulting into a promissory note.  The note is
due on demand and carries an interest rate of 6% per annum.  The note
is secured by any and all revenues received by MicroCor from the sale,
disposition or commercialization of the Hematocrit Technology.
  During
2008, the Company received $20,500 in loans from officers and directors of the
Company.  The same officers and directors also paid expenses of
$16,885 on behalf of the Company.  At December 31, 2008, the Company
executed promissory notes with the officers and directors for the amounts loaned
above.  The notes are due on demand and carry an interest rate of 6%
per annum.  These loans are secured by the proceeds of option
exercises by SNG Consulting LLC pursuant to its option to acquire 5,000,000
shares of the common stock of the Company, but only by such proceeds as
correspond to exercises after the initial minimum share purchase option exercise
by Law Investments.  In the event of such option exercise, such
revenues shall be applied first to the retirement of these notes. (See Note
5).
  On
December 31, 2008, the Company converted $48,000 of accrued payroll due to
officers into promissory notes.  The notes are due on demand and carry
an interest rate of 6% per annum.  The notes are secured by any and
all revenues received by MicroCor from the sale, disposition or
commercialization of the Hematocrit Technology.
  Wescor
has loaned to MicroCor sufficient funds to enable Microcor to pay one half of
the minimum royalty owing to InMedica under the Joint Development
Agreement.  Funds from the minimum royalty are used by InMedica to
fund administrative expenses of the Company.  Repayment of the loan to
Wescor by MicroCor is secured by a 20% security interest in any future revenues
from the sale of the hematocrit technology by MicroCor, until the loan is repaid
in full.
 31
 Table of Contents
 Index
to Financial Statements
  INMEDICA
DEVELOPMENT CORPORATION AND SUBSIDIARY
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 FOR
THE YEARS ENDING DECEMBER 31, 2008 AND 2007
 NOTE 9 - JOINT DEVELOPMENT
AGREEMENT
  Effective
September 7, 2004, InMedica and MicroCor entered into the Joint Development
Agreement pursuant to which Wescor, a Utah medical technology company ("Wescor")
assumed responsibility for the day-to-day operation of MicroCor and the conduct
of research and development of the Hematocrit Technology.  The
Agreement provides that in the event Wescor is successful in producing a working
prototype using the hematocrit technology, capable of meeting FDA GMP
requirements suitable for conducting clinical trials (Phase1), MicroCor
will issue 500,000 additional restricted shares of MicroCor stock to Wescor.
Thereafter if Wescor completes clinical trials and obtains the FDA's clearance
to market such products (Phase 2), 500,000 additional restricted shares of
MicroCor stock will be issued to Wescor by MicroCor. Then, upon manufacturing
and initial introduction into the US market of such products (Phase 3), MicroCor
will issue to Wescor an additional 700,000 restricted shares of its stock,
giving Wescor a total of 49% of the issued and outstanding stock of MicroCor.
These additional shares to be issued to Wescor will be in consideration of each
Phase of development work by Wescor. The determination of Wescor's completion of
the above three Phases will be made by MicroCor's board which is controlled by
InMedica. In the event of a disagreement between the parties as to fulfillment
of the above standards, the parties intend to negotiate in good faith to resolve
the matter.
 
 The
number of shares to be issued by MicroCor to Wescor for services has been
determined during a process of arms length negotiation between InMedica and
Wescor. During such negotiations, the board of directors of InMedica considered
the need for funding to continue development of the hematocrit technology, the
Company's present financial condition (ie. lack of cash flow, limited capital
assets and limited borrowing capacity), the lack of interest expressed by the
larger companies contacted by the board of directors (in the absence of an FDA
cleared prototype), the lack of present capacity of the smaller companies
contacted by the board (other than Wescor) and the reputation and experience of
Wescor in development of medical technology. Based on these considerations, the
board concluded that, in its judgment, the Agreement should be
pursued.  The initial 500,000 restricted shares of MicroCor were
issued to Wescor during the third quarter of 2005.
 32
 Table of Contents
 Index
to Financial Statements
  INMEDICA
DEVELOPMENT CORPORATION AND SUBSIDIARY
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 FOR
THE YEARS ENDING DECEMBER 31, 2008 AND 2007
 NOTE 9 - JOINT DEVELOPMENT
AGREEMENT (Continued)
 
 Upon
completion of Phase 2, and again upon completion of Phase 3, Wescor will have
the option to purchase all (but not less than all) the remaining stock of
MicroCor from InMedica and Chi Lin, for 90 days. The buyout price to Wescor for
the remaining MicroCor shares will be 90% of an appraised value or a value
suggested by Wescor.  Wescor will choose the appraiser subject to the
right of InMedica and Chi Lin to object to the selection. In the case of an
objection Wescor will make another selection until the parties are in agreement.
Following receipt of Wescor's notice of appraised value or suggested value,
InMedica and Chi Lin will have the right to obtain a fairness opinion at their
expense, before acting on Wescor's offer. The fairness opinion of the value of
the MircoCor stock will be obtained from a business valuation expert, chosen by
InMedica and Chi Lin, as to which Wescor has no reasonable objection. If the
fairness opinion reports that Wescor's appraised or suggested value is not
within a fair range, Wescor's option to purchase the balance of the MicroCor
stock from Chi Lin and InMedica will terminate. However, if Wescor's appraised
or suggested value is determined by the fairness opinion to be within a fair
range, InMedica and Chi Lin will still have the opportunity to acquire the
complete ownership of MicroCor through a "trump" option allowing them to offer
to purchase all of the shares of MicroCor owned by Wescor at 110% of Wescor's
appraised value or suggested value. In such
case, Wescor may chose to sell its ownership of MicroCor to InMedica and Chi Lin
or may revive its first option by a notice to InMedica and Chi Lin increasing
the purchase price so as to be based on at least 110% of the valuation used as
the trump option value by InMedica and Chi Lin. This option procedure,
essentially bidding for the right to purchase all of the MicroCor stock, may be
repeated as many times as is necessary until a purchaser has been determined. If
Wescor is ultimately the purchaser, the Agreement will terminate except for the
royalty rights of InMedica and Chi Lin. Wescor has also been granted a right of
first refusal in the event of a bona fide third party offer to acquire
MicroCor.
  Wescor
recently advised the Company and Chi Lin that its parent corporation was
interested in shifting Wescor’s resources previously dedicated to the research
and development of the Hematocrit Technology to other projects.  As a
result, Wescor ceased all research and development efforts on the Hematocrit
Technology.  Wescor continues to be interested in bringing on a new
partner to continue the research and development or perhaps in selling its
interest in the Technology.  The Company is presently discussing the
matter with Wescor.   No present plans or commitments for other
alternatives have been made.
 33
 Table of Contents
 Index
to Financial Statements
  INMEDICA
DEVELOPMENT CORPORATION AND SUBSIDIARY
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 FOR
THE YEARS ENDING DECEMBER 31, 2008 AND 2007
 NOTE 10- ROYALTY
RIGHTS
  In
connection with the Joint Development Agreement, MicroCor has granted certain
revenue royalty rights to InMedica and Chi Lin under the Agreement based on
future annual revenues from the hematocrit technology and calculated as follows:
Annual royalties will equal the sum of four percent (4%) of the first $5,000,000
in sales and licensing revenues, three percent (3%) of sales and licensing
revenues in amounts exceeding $5,000,000 but not exceeding $20,000,000, and two
percent (2%) of sales and licensing revenues in amounts exceeding $20,000,000;
plus (ii) twenty five percent (25%) of all royalty revenues (revenues from
licensing of the hematocrit technology to others). The total royalties are split
between InMedica and Chi Lin with InMedica receiving a percentage of total
royalties equal to a fraction, the numerator of which is the total world
revenues from sales of the hematocrit technology, less the revenues from sales
in Asia; and the denominator of which is the total world revenues from sales.
The Chi Lin royalty is a percentage of total royalties equal to a fraction, the
numerator of which is revenue from sales in Asia; and the denominator of which
is the total world revenues from sales. Asia is defined to mean Australia, New
Zealand and the countries of Asia (including without limitation, Indonesia,
Malaysia and the island countries of the Western Pacific Rim; but excluding
Russia, Turkey and the countries of the Middle East from Iran and to the west).
Further, a minimum royalty of $200,000 per year begins 18 months after the
effective date and is payable by MicroCor to InMedica and Chi Lin on an 80%-20%
basis without regard to whether actual sales have been made. However in the
event that any party (including Wescor) or a third party acquires eighty percent
control of MicroCor, the new control party has the right to buy out the royalty
rights from InMedica and Chi Lin for $1,000,000 or 100% of five times the sum of
the minimum royalty payments for the immediately preceding 12 months, whichever
is greater. The buyout proceeds would be shared 80%-20% by InMedica and Chi
Lin.  At the present time, MicroCor is paying 50% of the minimum
royalty to InMedica and Chi Lin is deferring its minimum royalty
amounts.
 
 NOTE 11– UNCERTAIN TAX
POSITIONS
  Effective
January 1, 2007, the Company adopted the provisions of FASB Interpretation No.
48, “Accounting for Uncertainty in Income Taxes – an interpretation of FASB
Statement No. 109” (“FIN 48”). FIN 48 prescribes a recognition threshold and a
measurement attribute for the financial statement recognition and measurement of
tax positions taken or expected to be taken in a tax return. For those benefits
to be recognized, a tax position must be more-likely-than-not to be sustained
upon examination by taxing authorities. The adoption of the provisions of FIN 48
did not have a material impact on the company’s condensed consolidated financial
position and results of operations. At December 31, 2008, the company had no
liability for unrecognized tax benefits and no accrual for the payment of
related interest.
 
 34
 Table of Contents
 Index
to Financial Statements
  INMEDICA
DEVELOPMENT CORPORATION AND SUBSIDIARY
 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
 FOR
THE YEARS ENDING DECEMBER 31, 2008 AND 2007
 NOTE 11– UNCERTAIN TAX POSITIONS
(Continued)
 
 Interest
costs related to unrecognized tax benefits are classified as “Interest expense,
net” in the accompanying consolidated statements of operations. Penalties, if
any, would be recognized as a component of “Selling, general and administrative
expenses”. The Company recognized $0 of interest expense related to unrecognized
tax benefits for the year ended December 31, 2008.  In many cases the
company’s uncertain tax positions are related to tax years that remain subject
to examination by relevant tax authorities. With few exceptions, the company is
generally no longer subject to U.S. federal, state, local or non-U.S. income tax
examinations by tax authorities for years before 2005. The following describes
the open tax years, by major tax jurisdiction, as of December 31,
2008:
 
 United
      States (a)
                    
                    2005
      – Present(a)
      Includes federal as well as state or similar local jurisdictions, as
      applicable.
 
 
 35
 Table of Contents
 Index
to Financial Statements
 ITEM
      9.
                CHANGES IN AND DISAGREEMENTS
      WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
    DISCLOSURE
  During
the registrant’s two most recent fiscal years and any subsequent interim period,
there were no disagreements with accountants on any matter of accounting
principles or practices, financial statement disclosure or auditing scope
or procedure, which disagreement(s) if not resolved to the satisfaction of the
former accountants would have caused them to make reference to the subject
matter of the disagreement(s) in connection with their reports.  The
former accountants’ reports for the period of their engagement did not contain
an adverse opinion or disclaimer of opinion.  However the former
accountants’ reports were each modified for uncertainty whether the registrant
would continue as a going concern.  There was no qualification or
modification as to audit scope or accounting principles.
  ITEM
      9A(T).
                  CONTROLS AND
      PROCEDURES
  Management
is responsible for establishing and maintaining adequate internal control over
financial reporting for the small business issuer.  The Company’s
Chief Executive Officer and Chief Financial Officer have concluded, based on an
evaluation required by paragraph (b) of Section 240.13a-15 or 240.15d-15 of the
Rules of the Securities Exchange Act of 1934 (the “Exchange Act”),
conducted as of the end of the period covered by this Annual Report on Form
10-K, that the Company’s disclosure controls and procedures (as defined in
Exchange Act Rules 13a–15(e) or 240.15d-15(e)) have functioned
effectively.   For purposes of this Item, the term “disclosure controls and
procedures” means
controls and other procedures of the Company that are designed to ensure that
information required to be disclosed by the Company in the reports that it files
or submits under the Exchange Act (15 U.S.C. 78a et seq.) is recorded,
processed, summarized and reported, within the time periods specified in the
Commission’s rules and forms. Disclosure controls and procedures include,
without limitation, controls and procedures designed to ensure that information
required to be disclosed by the Company in the reports that it files or submits
under the Exchange Act is accumulated and communicated to the issuer’s
management, including its principal executive and principal financial officers,
or persons performing similar functions, as appropriate to allow timely
decisions regarding required disclosure.   This annual report
does not include an attestation report of the Company’s registered public
accounting firm regarding internal control over financial
reporting.   Management’s report was not subject to attestation
by the Company’s registered public accounting firm pursuant to temporary rules
of the Securities and Exchange Commission that permit the Company to provide
only management’s report in this annual report.
 There
have been no changes in the Company’s internal control over financial reporting
identified in connection with the evaluation required by paragraph (d) of
Section 240.13a-15 or 240.15d-15 of the Rules of the Exchange Act, that occurred
during the Company’s last fiscal quarter (the Company’s fourth fiscal quarter in
the case of an annual report) that have materially affected, or is reasonably
likely to materially affect, the Company’s internal control over financial
reporting.  There
was, however, a change in the Company’s internal control over financial
reporting on January 30, 2009, as a result of the Company’s officers and
Directors resigning on that date and new officers and Directors being appointed.
At this time the Company does not believe this change in management will
materially affect the effectiveness of the Company’s internal control over
financial reporting in the future.  (See “Item 10. Directors, Executive Officers and
Corporate Governance -Subsequent Events”
below.)
  36
 Table of Contents
 Index
to Financial Statements
 ITEM
      9B.
                  OTHER
      INFORMATION
  Not
applicable.
   PART
III
 
 ITEM
      10.
                  DIRECTORS, EXECUTIVE OFFICERS
      AND CORPORATE
GOVERNANCE
  Directors and
Executive Officers of InMedica
  The
following table furnishes information concerning the officers and Directors of
InMedica during fiscal year 2008, and their business backgrounds for at least
the last five years:
 Name
                              
                              Age
                              
                              PositionLarry
      E. Clark
                              
                              87
                              
                              Chairman
      of the BoardRalph
      Henson
                              
                              64
                              
                              Chief
      Executive Officer and DirectorRichard
      Bruggeman
                              
                              54
                              
                              Chief
      Financial Officer and
Director
 Larry E. Clark - Chairman of the Board since
April 1995. Mr. Clark was president of Clark-Knoll & Associates, Inc., a
Denver, Colorado management consulting firm specializing in mergers and
acquisitions from 1963 to 1969. He served as president of Petro-Silver, Inc., a
small public company based in Salt Lake City, Utah, which engaged in the oil and
gas business from 1970 to 1975. Beginning in 1975 and continuing to December,
2003, Mr. Clark was president of Larry Clark & Associates, a private company
which engaged in a corporate mergers and acquisitions business or business
consulting. In 1981, Mr. Clark formed Hingeline-Overthrust Oil & Gas, Inc.,
a Utah public company, which merged with Whiting Petroleum Corporation of
Denver, Colorado in December 1983. Mr. Clark served as a director of Whiting
Petroleum from 1983 until 1992 when Whiting Petroleum merged with IES Industries
and Mr. Clark returned to full time employment as president of Larry Clark &
Associates. Mr. Clark was President of InMedica from April 1995 until December,
1999.   Mr. Clark graduated from the U.S. Merchant Marine Academy
with a BS degree in Naval Science in 1943 and received a degree in Business
Administration from the University of Wyoming in 1948.
 
 Ralph Henson - Director, President and Chief
Executive Officer of the Company since December 1999.  Prior to his
employment with InMedica, Mr. Henson worked from 1996 until 1999 as Director of
Sales and acting Director of Clinical Programs of In-line Diagnostics of
Farmington, Utah. He was also employed from 1987 to 1994 with Mallinckrodt
Medical, in sales and marketing, including service as Export Sales and Marketing
Manager for Mallinckrodt Sensor Systems of Hannef, Germany.  From 1994
to 1995 he was national sales manager with HemoCue, Inc. of Mission Viejo,
California.
 
 37
 Table of Contents
 Index
to Financial Statements
 Richard Bruggeman - Director and
Secretary/Treasurer and Chief Financial Officer of the Company since April, 1995
and full time employee of the Company during 2002.  Since 2003, Mr.
Bruggeman has been employed with Kitchen Resource, Inc., a Utah based firm
distributing kitchen appliances.  He was employed part time or full
time as Controller of Kitchen Specialties, Inc. from 1993 to December, 2001, a
Salt Lake City firm distributing kitchen appliances in the United States and
Canada.  From 1986 until 1993 he was employed by the Company’s
subsidiary, MicroCor, Inc. as financial manager.   During the
period 1983-1985, he was a sole practitioner in accounting and from 1981-1983 he
was employed by the Salt Lake City public accounting firm of Robison Hill &
Co.  He has since had no affiliation with that accounting
firm.  He graduated from the University of Utah in 1981 with a B.S.
degree in accounting.
  Subsequent
Events
 
 New Directors and
Executive Officers of InMedica
  The
following table furnishes information concerning the executive officers and
Directors of InMedica elected on January 30, 2009, and their business
backgrounds for at least the last five years.
  Name
                                
                                Age
                                
                                PositionRonald
      Conquest
                                
                                64
                                
                                Chairman
      of the Board, Chief Executive Officer and DirectorWayne
      R. Meyers
                                
                                55
                                
                                President
      and DirectorChristopher
      R. Miller
                                
                                40
                                
                                Chief
      Financial Officer and
Director
 Ronald Conquest - Director, Chairman of the
Board and Chief Executive Officer of the Company since January 30,
2009.  Over the
past four decades, Mr. Conquest has developed a diversified business management
background, including ownership and/or operation of,or
involvement with, a wide variety of public and private companies inthe United States,
Canada, Mexico, Brazil, United Kingdom, Costa Rica, Peoples Republic of
China, and the Commonwealth of Independent States (former USSR).Mr.
Conquest’s executive experience includes Chairman of the Board and CEO level
corporate management, along with domestic and international corporate finance
with public and private corporations. Mr. Conquest’s corporate structuring
background includes corporate mergers, acquisitions and reorganizations,
initial public offerings, public shell reverse mergers, corporate public
relations and securities market making.  He also hasexperience
in concept development, business plan development, business organization,
strategic planning, start-up, sales, marketing and promotion, and personnel
management.Since 2001, he has acted as a financial consultant with
regard to investment and merchant banking and acquisitions and mergers under the
trade name The Conquest Group located in Phoenix, Arizona.  Mr. Conquest
was educated at the University of Oklahoma, studying Mathematics and
Engineering.
 38
 Table of Contents
 Index
to Financial Statements
 Wayne R. Myers-  Director
and President of the Company since January 30, 2009.  Mr. Myers
is a senior level telecommunications executive with broad strategic business
development expertise and wide experience in sales management in the USA,
Europe, Middle East, Africa and India.F rom
2006 to present, Mr. Myers has served as founder and Chief Executive Officer of
x-Mobility Ltd. located in London, United Kingdom.  x-Mobility Ltd. is
a cellular telephone service provider/MVNO carrier focusing on fixed mobile
convergence targeting SMEs with unique applications for vertical markets with
distribution through major brands.  From
June 2003 through November 2005, Mr. Myers served as Chief Operating
Officer of Comoretel Holdings Ltd., London, United Kingdom, a telecommunication
company providing unique patented UIFN/ITFS applications for emerging markets
worldwide.From
June 1997 through November 2003, Mr. Myers served as President–Europe and Senior Vice
President of Global Business Development for VIATEL Inc., Paris,
France/London, United Kingdon.VIATEL Inc. is a
telecommunication company providing voice, data, Internet and broadband services
marketed to the enterprise, SME and consumer markets utilizing direct and
channel sales distribution.Mr. Myers was also recently appointed
as a Director of Peach Amber Ltd. of London, United Kingdom.
  Christopher R. Miller- Director and Chief
Financial Officer of the Company since January 30, 2009.  Mr. Miller
graduated from Arizona State University in 1994 with a Bachelor of Science
Degree in Finance.  From 1994
through 2000, Mr. Miller held various positions at U-Haul® International,
Inc.  As Treasurer of U-Haul® Self Storage Corporation (a subsidiary of
U-Haul® International) and Senior Financial Analyst for UHAL, Mr. Miller’s
responsibilities included the organization, underwriting, negotiation, auditing,
financial modeling, management and reporting for the company’s acquisitions and
financings.  Mr. Miller was involved with the management, purchase and
financing of over $300 million of self-storage facilities funded primarily
through CMBS placements and synthetic lease transactions involving Merrill
Lynch-Canada, First Union, Wells Fargo and GE Capital. Mr. Miller’s
responsibilities also included the management, development and mentoring of
three MBA level financial analysts comprising U-Haul’s Management Information
Analysis Department, along with producing U-Haul’s monthly Board of Directors
presentation on company financial performance.Beginning
in late 2000, Mr. Miller became Chief Financial Officer for AutoAuto Wash®, a
start-up operation of car wash facilities.  His active employment
included capital raising, operations, facility openings, accounting and
marketing, facilitating the growth of the chain to 27 facilities nationally in
just over a year.From 2002
through the present, Mr. Miller has been providing financial consulting services
to a wide variety of organizations specializing in asset valuation, business
start-up and financing and private and public company valuations. Projects
include self-storage portfolio acquisitions, retail start-up operations and
exclusive high-rise and low-density beachfront condominium developments.Beginning
in June 2006 to the present, Mr. Miller has been providing public company
valuation, financial modeling and due diligence services to Doherty &
Company, LLC, a Los Angeles based licensed broker-dealer specializing in venture
capital, private equity funding, mergers and acquisitions advisory, and
valuations for early stage companies.Since 2003, Mr. Miller has
offered specialized consulting services to entrepreneurs, private investment
companies and licensed securities brokers-dealers under the name Sun Capital,
LLC located in Phoenix, Arizona.
  Each
Director serves until the next annual meeting of shareholders or until a
successor is elected and qualified.  Officers serve at the pleasure of
the Board of Directors.  No arrangement or understanding exists
between any officer or Director and any other person pursuant to which he was
nominated or elected as Director or selected as an
officer.
 
 39
 Table of Contents
 Index
to Financial Statements
 Section 16(a)
Beneficial Ownership Reporting
Compliance
  Section
16(a) of the Securities Exchange Act of 1934 requires the Company’s Directors
and executive officers, and persons who own more than 10% of a registered class
of the Company’s equity securities to file with the Securities and Exchange
Commission  (“SEC”) initial reports of
ownership and reports of changes in ownership of equity securities of the
Company. Officers, directors and shareholders holding greater than 10% are
required 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 any
such reports furnished to the Company, during the fiscal year ended December 31,
2008, and thereafter, all Section 16(a) filing requirements applicable to
officers, directors and shareholders holding greater than 10% have been
filed, except
Synergistic Equities Ltd. and Law Investments CR, S.A. and their respective
affiliates, as option holders of more than 10% of the Company’s equity
securities, have not filed the required Section 16(a) forms with the SEC or the
Company and SNG Consulting LLC and its affiliate, as an option holder of more
than 10% of the Company’s equity securities, only filed the required Section
16(a) forms with the SEC and the Company on April 9, 2009.  However, Mr.
Conquest, in his capacity as President and a Director of LI,  filed
his Form 3 with the SEC and the Company, relating to his indirect beneficial
ownership of the LI Option on April 10, 2009.  Mr. Conquest disclaims any
beneficial ownership interest in the LI Option or the underlying
shares.
  Code of
Ethics
  The
Company has adopted a code of ethics for its principal executive officer,
principal financial officer, principal accounting officer or controller, and
persons performing similar functions.  A copy of the Code of Ethics
will be furnished upon request without charge.
 
 Audit
Committee Financial Expert
  The
Company’s Board of Directors does not have an “audit committee financial
expert,” within
the meaning of such phrase under applicable regulations of the Securities and
Exchange Commission, serving on its audit committee. Like many small companies,
it is difficult for the Company to attract and retain Board members who qualify
as “audit committee financial experts.”
  Nominating
Committee
 
 The full
Board of Directors of the Company functions as a nominating committee to select
potential additional directors of the Company.   The Board has
not specifically designated a separate nominating committee because all three
members of the Board of Directors desire to be involved in the selection of any
new director.
  40
 Table of Contents
 Index
to Financial Statements
 ITEM
      11.
                  EXECUTIVE
      COMPENSATION
  The table
below discloses the compensation of the chief executive officer of the Company
during the three fiscal years ended December 31, 2008:
 Executive
      Compensation TableAnnual
      CompensationName
      and Principal Position
                              Fiscal
                                Year
                              Salary
                                ($)
                              Bonus
                                ($)
                              All
      Other
                                Compensation
                                ($)
                              Total
                                ($)Ralph
      Henson
                                Chief
      Executive Officer
                              2008
                                2007
                                2006
                              30,000
      (1)
                                84,000
      (2)
                                33,000
                              –
                                –
                                –
                              $0
                                $65,000
                                $65,000
                              $  30,000
                                $149,000
                                $ 
      98,000
   (1)
                      Paid
      or reimbursed by Wescor.
 (2)
                      Includes
      $60,000 reimbursed by
Wescor.
 Since the
beginning of the last fiscal year, there have been no stock options or stock
appreciation rights granted to or exercised by officers named in the executive
compensation table.  The Company presently has no plan for the payment
of any annuity or pension retirement benefits to any of its officers or
directors, and no other remuneration payments, contingent or otherwise, are
proposed to be paid in the future to any officer or director, directly or
indirectly.   Directors have not been compensated for services
and there are no plans for any director compensation.
  The
Company entered into a consulting contract with Larry E. Clark, its Chairman,
effective April 1, 2001, pursuant to which the Company compensates the Chairman
$2,000 per month in consulting fees.  Fees under the contract have
historically been accrued until the Company was able to pay the Chairman or
issued restricted stock in satisfaction of its obligations to the
Chairman.
 “Item 1. Business - Option
Agreements”
  41
 Table of Contents
 Index
to Financial Statements
 Compensation
Committee, Interlocks and Insider Participation
 
 The full
Board of Directors of the Company functions as a compensation
committee.  The Board has not specifically designated a separate
compensation committee due to the relatively small size of the
Company.
 Subsequent
Event
  During
2009, it is projected that Ronald Conquest, the new Chairman of the Board and
Chief Executive Officer, will receive compensation of $5,000 per month
beginning June 1, 2009, and no bonus or other compensation is effective as of
the date of this report.
 ITEM
      12.
                      SECURITY OWNERSHIP OF CERTAIN
      BENEFICIAL OWNERS ANDMANAGEMENT
  The
following table sets forth certain information as of March 31, 2009, with
respect to the beneficial ownership of the Company’s common stock by each
executive officer and Director of the Company and each person known by the
Company to be the beneficial owner of more than 5% of the Company’s outstanding
shares of common stock.
 Name,
      Address and Position
                          of
      Beneficial Owner
                        
                        Amount
      and Nature of
                          Beneficial
      Ownership (1)
                        
                        Percent
      of
                          Class
      (2)Principal
      Stockholders:Chi
      Lin Technologies Co., Ltd.
                          717
      No. 71, Te Lun RD
                            Jen
      Te Hsian, Taiwan
                        
                        6,043,704
      (3)
                        
                        32.4%Larry
      E. Clark
                          1036
      Oak Hills Way
                            Salt Lake City, Utah  84108
                        
                        2,937,025
                        
                        15.8%Synergistic
      Equities Ltd.
                          55
      Frederick Street
                            Nassau,
      Bahamas
                        
                        6,043,704
      (3)
                        
                        32.4%SNG
      Consulting LLC
                          15029 N. Thompson Peak
      Parkway
                            Suite
B111-520
                            Scottsdale,
      Arizona 85260
                        
                        5,000,000
      (4)
                        
                        21.2%Ashley
      Conquest
                          15029 N. Thompson Peak
      Parkway
                            Suite
B111-520
                            Scottsdale,
      Arizona 85260
                        
                        5,000,000
      (4)
                        
                        21.2%Law
      Investments CR, S.A.
                          14550
      Frank Lloyd Wright Blvd.
                          Suite
      100
                          Scottsdale, Arizona
      85260
                        
                        15,000,000 (5)
                        
                        44.6%
  42
 Table of Contents
 Index
to Financial Statements
  Name,
      Address and Position
                              of
      Beneficial Owner
                            
                            Amount
      and Nature of
                              Beneficial
      Ownership (1)
                            
                            Percent
      of
                              Class
      (2)Officers and
      Directors:(6)Ronald
      Conquest,
                              Chairman,
      Chief Executive Officer
                              and Director
                            
                            15,000,000 (5)
                            
                            44.6%Wayne
      R. Myers
                              President
      and Director
                            
                            0
                            
                            0%Christopher
      R. Miller
                              Secretary/Treasurer,
                              Chief
      Financial Officer
                              and Director
                            
                            0
                            
                            0%All
      Executive Officersand Directors as
      agroup (3
      persons)
                            
                            15,000,000
      (5)
                            
                            44.6%
  (1)
                          Except
      as otherwise indicated, we believe that the beneficial owners of the
      common stock listed above, based on information furnished by such owners,
      have sole investment and voting power with respect to such shares, subject
      to community property laws where applicable. Beneficial ownership is
      determined in accordance with the rules of the Securities and Exchange
      Commission and generally includes voting or investment power with respect
      to securities. Shares of common stock subject to options or warrants
      currently exercisable, or exercisable within 60 days, are deemed
      outstanding for purposes of computing the percentage ownership of the
      person holding such option or warrants, but are not deemed outstanding for
      purposes of computing the percentage ownership of any other person. 
      The inclusion herein of such shares listed as beneficially owned does not
      constitute an admission of beneficial
ownership.
 (2)
                          Based
      on 18,629,493 shares of common stock issued and outstanding as of
      March 31, 2009 and assumes the exercise of options, to which the
      percentage relates.
  (3)
                        These
      shares are presently owned by Chi Lin Technologies Co., Ltd., but were
      optioned to Synergistics Equities, Ltd. on September 10,
    2008.
 
 (4)
                        These
      shares represent the shares to be issued upon exercise of the option
      granted by the Company to SNG Consulting, LLC on December 8,
      2008, of which Ashley Conquest is the sole member and
      manager.
 
 (5)
                        These
      shares represent the shares to be issued upon exercise of the option
      granted by the Company to Law Investments CR, S.A. on December
      8, 2008, of which Ronald Conquest is a director and
      President.  Mr. Conquest disclaims any beneficial ownership
      interest in the option or the underlying
shares.
  (6)
                      The address of our
      officers and Directors is c/o InMedica Development Corporation, 3104 E.
      Camelback Road, Suite 242, Phoenix, Arizona
  85016.
  43
 Table of Contents
 Index
to Financial Statements
 ITEM
      13.
                    CERTAIN RELATIONSHIPS AND
      RELATED TRANSACTIONS, AND DIRECTOR
  INDEPENDENCE
  No
officer, director, nominee for director, or associate of any such officer,
director or nominee has been, since the beginning of the last fiscal year, or is
presently indebted to the Company. There have been no transactions since the
beginning of the Company’s last fiscal year, nor are there any proposed
transactions, in which any officer, director, nominee or principal
securityholder has a direct or indirect material interest, except as
follows:
  At
December 31, 2008, the Company executed promissory notes to its three officers
and Directors at that time for the amounts due to them for accrued but unpaid
consulting fees and salaries, loans to the Company, and payments made to third
parties on behalf of the Company.  The total amount of these
promissory notes is $187,385.  The creditors on these promissory notes
are as follows:  Larry Clark - $120,238; Richard Bruggeman - $42,147;
and Ralph Henson - $25,000.  All of these promissory notes bear
interest at an annual rate of 6%. The promissory notes for accrued consulting
fees and salaries are secured by the future revenues to MicroCor from the
disposition or commercialization of its technology.  The promissory
notes for the loans to the Company and payments made to third parties on behalf
of the Company are secured by the proceeds to the Company in excess of $75,000
from the exercise of the LI and the SNG Options.
  On
December 8, 2008, the Company entered into a stock purchase option
agreement with Law Investments CR, S.A., a Costa Rica corporation
(“LI”). The agreement with LI is hereinafter referred to as (the “LI Agreement”). 
Pursuant to the terms of the LI Agreement,the Company granted to LI a
one-year option to purchase up to 15,000,000 restricted shares of the Company’s
common stock at a purchase price of $0.0075 per share (the “LI
Option”). The
LI Agreement is transferable by LI. The LI Agreement provides that the first
$75,000 received from the purchase of Company’s common stock pursuant to the LI
Agreement shall be distributed to Company’s wholly-owned subsidiary, ValuMobile,
as a contribution to capital.  The LI Agreement further provides that
LI and any of its affiliates shall not collectively acquire more than 88% of the
outstanding common stock of the Company until such time as the Company or
ValuMobile has been funded with at least $1,500,000.  The LI Option expires
on December 31, 2009.  Ronald Conquest, who is the new Chairman of the
Board and Chief Executive Officer of the Company (see, “Item 1. Business - Change in Control” above), is
a Director and President of LI.   Mr. Conquest disclaims any
beneficial ownership interest in the option or the underlying
shares.
 ITEM
      14.
                    PRINCIPAL ACCOUNTING FEES AND
      SERVICES
  The
following is a summary of the fees billed to us by Robison, Hill & Company
for  professional services rendered for the years ended December 31,
2008 and 2007:
 
 Service
                            
                            2008
                            
                            
                            2007Audit
      Fees
                            
                            $
                            13,625
                            
                            
                            $
                            17,500Audit-Related
      Fees
                            
                            
                            –
                            
                            
                            
                            –Tax
      Fees
                            
                            
                            725
                            
                            
                            
                            725All
      Other Fees
                            
                            
                            –
                            
                            
                            
                            –Total
                            
                            $
                            14,350
                            
                            
                            $
                            18,225
  44
 Table of Contents
 Index
to Financial Statements
 
 Audit
Fees. Consists of fees billed for professional services
rendered for the audits of our consolidated financial statements, reviews of our
interim consolidated financial statements included in quarterly reports,
services performed in connection with filings with the Securities and Exchange
Commission and related comfort letters and other services that are normally
provided by Robison, Hill & Company in connection with statutory and
regulatory filings or engagements.
  Tax
Fees. Consists of fees billed for professional services for tax
compliance, tax advice and tax planning. These services include assistance
regarding federal, state and local tax compliance and consultation in connection
with various transactions.
  Audit Committee
Pre-Approval of Audit and Permissible Non-Audit Services of Independent
Auditors.   The Board is to pre-approve all audit and
non-audit services provided by the independent auditors. These services may
include audit services, audit-related services, tax services and other services
as allowed by law or regulation. Pre-approval is generally provided for up to
one year and any pre-approval is as to the particular service or category of
services and is generally subject to a specific amount. The independent auditors
and management are required to periodically report to the Board regarding the
extent of services of the independent auditors in accordance with this
pre-approval and the fees incurred to date. The Board may also pre-approve
particular services on a case-by-case basis. The Board pre-approved 100% of the
Company’s 2007 and 2008 audit fees, audit-related fees, tax fees, and all other
fees.
 PART IV
  ITEM
      15.
                        EXHIBITS AND FINANCIAL
      STATEMENT SCHEDULES
  (a) (1)
Financial Statements
  The
Consolidated Financial Statements of the Company are set forth in Item 8 of this
Report as listed on the Index to Consolidated Financial Statements on page 14 of
this Report.
  (a) (2)
Financial Statement Schedules
  All
schedules are omitted because they are not applicable, or are not required, or
because the required information is included in the Consolidated Financial
Statements or notes thereto.
  45
 Table of Contents
 Index
to Financial Statements
  (a) (3)
Exhibits
  Exhibit
    No.
                                                    
                                                    Description10.1a
                                                    
                                                    Option to
      Purchase Common Stock between Synergistic Equities Ltd. and Chi Lin
      Technologies Co., Ltd., dated September 10, 2008
      (1)10.1b
                                                    
                                                    Proxy
      dated September 10, 2008 (2)10.2
                                                    
                                                    Stock
      Purchase Option Agreement between Registrant and SNG Consulting, LLC,
      dated December 8, 2008 (3)10.3
                                                    
                                                    Stock
      Purchase Option Agreement between Registrant and Law Investments CR, S.A.,
      dated December 8, 2008 (4)10.4
                                                    
                                                    Agreement
      between InMedica Development Corporation, MicroCor, Inc., Law Investments
      CR, S.A., and SNG Consulting, LLC, dated January 30, 2009
    (5)21
                                                    
                                                    Subsidiaries
      of the Registrant *31.1
                                                    
                                                    Certification
      by Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley
      Act *31.2
                                                    
                                                    Certification
      by Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley
      Act *32.1
                                                    
                                                    Certification
      by Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted
      Pursuant to Section 906 of the Sarbanes-Oxley Act *32.2
                                                    
                                                    Certification
      by Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted
      Pursuant to Section 906 of the Sarbanes-Oxley Act
  *
  *
                    Filed
      herewith.
 (1)
                    Incorporated by
      reference to Exhibit 2.4 of the Current Report on Form 8-K filed by the
      Registrant on February 9, 2009.
 (2)
                      Incorporated by
      reference to Exhibit 99.2 of the Form 10-Q for the Quarter Ended September
      30, 2008 filed by the Registrant on November 14,
  2008.
 (3)
                      Incorporated by
      reference to Exhibit 2.3 of the Current Report on Form 8-K filed by the
      Registrant on February 9, 2009.
 (4)
                        Incorporated by
      reference to Exhibit 2.2 of the Current Report on Form 8-K filed by the
      Registrant on February 9, 2009.
 (5)
                          Incorporated by
      reference to Exhibit 2.1 of the Current Report on Form 8-K filed by the
      Registrant on February 9,
2009.
  
 46
 Table of Contents
 Index
to Financial Statements
  SIGNATURES
 
 In
accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
 INMEDICA
      DEVELOPMENT CORPORATIONDate:  April 15, 2009
                            By:
                            /s/  Ronald
      ConquestRonald
      Conquest
                              Chairman of the
      Board
                              and
      Chief Executive Officer
                              (PrincipalExecutive
      Officer)
  In
accordance with the Securities Exchange Act of 1934, this report has been signed
by the following persons on behalf of the Company and in the capacities and on
the dates indicated:
 Signature
                            
                            
                            DateBy:
                            /s/  Ronald Conquest
                            
                            
                            April 15, 2009Ronald Conquest
                              Chairman of the Board,
                              Chief Executive Officer and Director
                              (PrincipalExecutive
      Officer)
 By:Wayne R. Myers
                                President, Chief Operating
                                Officerand Director
                                (Principal Operating Officer)
 By:
                                      /s/ Christopher R. Miller
                                      
                                      
                                      April
      15, 2009Christopher
      R. Miller
                                        Secretary/Treasurer,
                                            Chief Financial Officer and Director
                                            (Principal
      Accounting Officer)
   47