UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB

(Mark One)

(X)      QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
         ACT OF 1934

         For the quarterly period ended December 31, 2005

                                       OR

(   )    TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
         ACT OF 1934

         For the transition period from _____________ to _____________



Commission File Number 0-23153


                                 REMOTEMDX, INC.
        (Exact name of small business issuer as specified in its charter)


                  Utah                                  87-0543981
(State or other jurisdiction of                (IRS Employer Identification No.)
incorporation or organization)



                           150 West Civic Center Drive
                                    Suite 400
                                Sandy, Utah 84070
                    (Address of principal executive offices)

                                 (801) 563-7171
                           (Issuer's telephone number)


Check whether the issuer:  (1) filed all reports required to be filed by Section
13 or 15(d) of the  Securities  Exchange  Act during the past 12 months (or such
shorter period that the  registrant was required to file such reports),  and (2)
has been subject to such filing  requirements for the past 90 days.

                                 Yes [X] No [ ]

On February  10,  2006,  the issuer had a total of  54,864,632  shares of common
stock issued and  outstanding.  The issuer also had a total of 21,786  shares of
Series A Preferred Stock  outstanding,  convertible at any time at the option of
the holders  thereof into common stock at the rate of 370 shares of common stock
for each share of Series A Preferred Stock, or a total of 8,060,820 shares,  and
272,332 shares of Series B Preferred Stock outstanding,  convertible at any time
at the option of the holders  thereof  into  approximately  2,043,000  shares of
common stock.

Transitional Small Business Disclosure Format (Check One): Yes [   ]  No [X]


                                       1
<PAGE>
                                TABLE OF CONTENTS

<TABLE>
<CAPTION>


                                                                                                          Page
                                                                                                           No.
                                                                                                         -----
<S>                                                                                                       <C>
PART I.  FINANCIAL INFORMATION

         Item 1.  Financial Statements

                  Condensed Consolidated Balance Sheet as of December 31, 2005 (Unaudited)                3

                  Condensed Consolidated Statements of Operations for the three
                     months ended December 31, 2005 and 2004 (Unaudited)                                  4

                  Condensed Consolidated Statements of Cash Flows for the three
                     months ended December 31, 2005 and 2004 (Unaudited)                                  5

                  Notes to Condensed Consolidated Financial Statements (Unaudited)                        7

         Item 2.  Management's Discussion and Analysis or Plan of Operation                               14

         Item 3.  Controls and Procedures                                                                 18


PART II.  OTHER INFORMATION

         Item 2.  Changes in Securities and Use of Proceeds                                               19

         Item 5.  Other Information                                                                       19

         Item 6.  Exhibits and Reports on Form 8-K                                                        19

         Signatures                                                                                       21

</TABLE>

                                       2
<PAGE>

                          PART I. FINANCIAL INFORMATION

Item 1. Financial Statements
                        REMOTEMDX, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEET
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                                              December 31,
                                                                                                  2005
                                                                                             -------------
<S>                                                                                          <C>
Assets
Current assets:
     Cash                                                                                    $   1,212,968
     Accounts receivable, net of allowance for doubtful accounts of $23,000                         93,623
     Inventories                                                                                    38,169
     Restricted cash                                                                               181,564
     Prepaid expenses                                                                               37,299
          Total current assets                                                                   1,563,623
     Property and equipment, net of accumulated depreciation and amortization
          of $513,339                                                                              381,657
     Other assets                                                                                   43,098
                                                                                             -------------

         Total assets                                                                        $   1,988,378

Liabilities and Stockholders' (Deficit)
Current liabilities:
     Bank line of credit                                                                     $     174,475
     Related party line of credit and note, net debt discount of $3,750 (note 5)                   252,113
     Accounts payable                                                                            1,494,226
     Accrued liabilities                                                                           497,508
     Dividends payable                                                                             124,461
     Deferre drevenue                                                                               17,757
     Convertible debentures, net of debt discount of $28,087 (note 6)                            1,290,452
     Notes payable, net of debt discount of $692 (note 3)                                          780,697
     Common stock subject to mandatory redemption                                                   96,000
     Embedded derivative liability (note 8)                                                      2,926,527
     Redeemable SecureAlert Series A Preferred Stock (note 7)                                      358,410
     Total current liabilities                                                                   8,012,626

Long term liabilities
     Convertible debentures, net of discountof $814,722 (note 3)                                   656,196
                                                                                             -------------
         Total liabilities                                                                       8,668,822

SecureAlert Series A Preferred Stock                                                             2,990,000

Stockholders' deficit:
     Preferred stock:
       Series A; 10% dividend, convertible, non-voting; $0.0001 par value;
       40,000 shares designated; 21,786 shares outstanding (aggregate liquidation
       preference of $59,605)                                                                            2
       Series B; convertible; $0.0001 par value; 2,000,000 shares designated;
       272,332 shares outstanding (aggregate liquidation preference of $816,996)                        27
       Common stock; $0.0001 par value; 100,000,000 shares authorized,
       54,416,288 shares outstanding                                                                 5,442
Additional paid-in capital                                                                      78,106,677
Deferred compensation                                                                          (3,873,144)
Accumulated deficit                                                                            (83,909,448)
                                                                                             -------------
         Total stockholders' deficit                                                            (9,670,444)
                                                                                             -------------

         Total liabilities and stockholders' deficit                                         $  1,988,378
                                                                                             -------------

 See accompanying notes to unaudited condensed consolidated financial statements.
</TABLE>

                                       3
<PAGE>

                        REMOTEMDX, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                                           Three Months Ended
                                                                                              December 31,
                                                                                          2005              2004
                                                                                   ----------------    ---------------
<S>                                                                                <C>                 <C>
Net sales                                                                          $        219,493    $       207,519
Cost of goods sold                                                                          107,143            147,084
                                                                                   ------------------- ---------------
      Gross profit                                                                          112,350             60,435

Operating expenses
       Research and development expenses                                                    729,933            204,730
       Selling, general and administrative expenses (including $451,820 and
         $123,525 of compensation expense paid in stock or stock option /
         warrants, respectively.)                                                         1,743,612            933,335
                                                                                   ----------------    ---------------
              Loss from operations                                                       (2,361,195)        (1,077,630)

Other income (expense):
       Derivative valuation gain (loss)                                                    (490,901)                 -
       Other income (expense)                                                                 2,000                (30)

       Interest income                                                                        1,253                817
       Interest expense                                                                    (596,910)          (238,983)
                                                                                   ----------------    ---------------
              Loss before income taxes                                                   (3,445,753)        (1,315,826)

Income tax benefit                                                                                -                  -
                                                                                   ----------------    ---------------
              Net loss                                                                   (3,445,753)        (1,315,826)

Dividends on Series A preferred stock                                                      (124,461)          (128,649)
                                                                                   ----------------    ---------------

Net loss attributable to common shareholders                                       $     (3,570,214)   $    (1,444,475)
                                                                                   ================    ===============
Net loss per common share - basic and diluted                                      $          (0.08)   $         (0.05)
                                                                                   ================    ===============
Weighted average common shares outstanding - basic and diluted                           47,166,000         31,455,000
                                                                                   ================    ===============


 See accompanying notes to unaudited condensed consolidated financial statements.
</TABLE>

                                       4
<PAGE>

                        REMOTEMDX, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                                           Three Months Ended
                                                                                              December 31,
                                                                                          2005              2004
                                                                                   ----------------    ---------------
<S>                                                                                <C>                 <C>
Cash flows from operating activities:

  Net loss                                                                         $     (3,445,753)   $    (1,315,826)
      Adjustments to reconcile net loss to net cash used in operating activities:
             Depreciation and amortization                                                   16,427              6,065
             Derivative liability valuation                                                 490,901                  -
             Common stock issued for services                                                27,000                  -
             Common stock issued for interest                                                63,366                  -
             Amortization of deferred financing and consulting costs                        562,937            127,575
             Accretion of interest expense related to redeemable common stock
               and debt                                                                     154,584                  -
             Amortization of debt discount                                                  139,252             27,000
             Stock options issued for services                                                    -            133,397
             Increase in related party line of credit for services                          175,562            128,594
             Changes in operating assets and liabilities:
                    Increase in restricted cash                                              (1,461)              (753)
                    Accounts receivable, net                                                  3,158            155,734
                    Inventories                                                               8,407            (10,998)
                    Prepaid expenses                                                         (4,164)             1,715
                    Accounts payable                                                        139,176            141,319
                    Accrued liabilities                                                    (191,517)            62,442
                    Deferred revenue                                                            218               (504)
                                                                                   ----------------    ---------------
                           Net cash used in operating activities                         (1,861,907)         (544,240)
                                                                                   ----------------    ---------------

Cash flows used in investing activities - purchase of property and equipment                (17,369)            (4,220)
                                                                                   ----------------    ---------------

Cash flows from financing activities:
      Net (repayments) borrowings under related-party line of credit                       (192,314)           (12,596)
      Net borrowings (payments) on bank line of credit                                         (423)                 -
      Decrease in subscription receivable                                                   504,900                  -
      Proceeds from issuance of common stock, net of $35,000 commissions                    700,000                  -
      Proceeds from the issuance of subsidiary preferred stock                              600,000            260,000
      Proceeds from issuance of notes payable and convertible debentures                  1,075,000            500,000
      Payments on notes payable                                                             (10,955)          (144,500)
                                                                                   ----------------    ---------------
                     Net cash provided by financing activities                            2,676,208            602,904
                                                                                   ----------------    ---------------
Net increase in cash                                                                        796,932             54,444

Cash, beginning of period                                                                   416,036             62,103
                                                                                   ----------------    ---------------
Cash, end of period                                                                $      1,212,968    $       116,547
                                                                                   ================    ===============

 See accompanying notes to unaudited condensed consolidated financial statements.
</TABLE>

                                       5
<PAGE>


                        REMOTEMDX, INC. AND SUBSIDIARIES
           CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                                           Three Months Ended
                                                                                              December 31,
                                                                                          2005              2004
                                                                                   ----------------    ---------------
<S>                                                                                <C>                 <C>
Cash paid for interest and taxes:
    Cash paid for income taxes                                                     $              -    $             -
    Cash paid for interest                                                                   43,400             14,649

Supplemental schedule of non-cash investing and financing activities:
     Issuance of shares of common stock in exchange for shares of Series A
        preferred stock                                                                           1                  1
    Accrual of Preferred Series A stock dividends                                           124,461            128,649
    Common stock issued for deferred financing costs                                        721,050              8,100



 See accompanying notes to unaudited condensed consolidated financial statements.

</TABLE>

                                       6
<PAGE>

                        REMOTEMDX, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)



(1)      ORGANIZATION AND NATURE OF OPERATIONS
         -------------------------------------

Basis of Presentation

The accompanying condensed consolidated financial statements of the Company have
been prepared by the Company, without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission. Certain information and
disclosures normally included in financial statements prepared in accordance
with accounting principles generally accepted in the United States have been
condensed or omitted pursuant to such rules and regulations. These condensed
consolidated financial statements reflect all adjustments (consisting only of
normal recurring adjustments) that, in the opinion of management, are necessary
to present fairly the results of operations of the Company for the periods
presented. These condensed consolidated financial statements should be read in
conjunction with the consolidated financial statements and the notes thereto
included in the Company's Form 10-KSB for the year ended September 30, 2005. The
results of operations for the three months ended December 31, 2005 are not
necessarily indicative of the results that may be expected for the fiscal year
ending September 30, 2006.

Going Concern

The Company has recurring net losses, has negative cash flows from operating
activities and has a working capital deficit, a stockholders' deficit and an
accumulated deficit. These factors raise substantial doubt about the Company's
ability to continue as a going concern. The financial statements do not include
any adjustments that might result from the outcome of this uncertainty.

Management's plans with respect to this uncertainty include converting debt
obligations to equity and raising additional capital from the sale of equity
securities, obtaining debt financing and enhance revenues and cash flows from
its operations by increasing selling and marketing efforts related to new and
existing products and services.

There can be no assurance that the Company will be able to raise sufficient
capital to meet its working capital needs. In addition, there can be no
assurance that the operations will generate positive cash flows and that the
Company will be economically successful from increasing selling and marketing
efforts to introduce new products into the market. Further, the Company may be
unable to complete the development and successful commercialization of any new
remote health monitoring products.

Principles of Consolidation

The condensed consolidated financial statements include the accounts of the
Company and its wholly or majority-owned subsidiaries. All significant
inter-company transactions have been eliminated in consolidation.

Stock-Based Compensation

The Company accounts for its stock-based compensation issued to employees and
directors under Accounting Principles Board Opinion ("APB") No. 25, "Accounting
for Stock Issued to Employees," and related interpretations. Under APB No. 25,
compensation related to stock options, if any, is recorded if an option's
exercise price on the measurement date is below the fair value of the Company's
common stock and amortized to expense over the vesting period.

An alternative method to the intrinsic value method of accounting for
stock-based compensation is the fair value based method prescribed by Statement
of Financial Accounting Standards (SFAS) No. 123, "Accounting for Stock-Based
Compensation," as amended by SFAS No. 148, "Accounting for Stock-Based
Compensation - Transition and Disclosure." If the Company used the fair value
based method, the Company would be required to record deferred compensation
based on the fair value of the stock option at the date of grant as computed
using an option-pricing model, such as the Black-Scholes option pricing model.
The deferred compensation calculated under the fair value based method would
then be amortized over the vesting period of the stock option. The Company
awarded no stock options to employees and had no employee stock options vest
during the periods ended December 31, 2005 and 2004.

                                       7
<PAGE>

Impairment of Long-Lived Assets

The Company reviews its long-lived assets for impairment when events or changes
in circumstances indicate that the book value of an asset may not be
recoverable. The Company evaluates, at each balance sheet date, whether events
and circumstances have occurred which indicate possible impairment. The Company
uses an estimate of future undiscounted net cash flows of the related asset or
group of assets over the estimated remaining life in measuring whether the
assets are recoverable.

Net Loss Per Common Share

Basic net loss per common share ("Basic EPS") is computed by dividing net loss
available to common stockholders by the weighted average number of common shares
outstanding during the period. Diluted net loss per common share ("Diluted EPS")
is computed by dividing net loss by the sum of the weighted-average number of
common shares outstanding and the weighted-average dilutive common share
equivalents then outstanding. The computation of Diluted EPS does not assume
exercise or conversion of securities that would have an anti-dilutive effect.

Common share equivalents consist of shares issuable upon the exercise of common
stock options and warrants, and shares issuable upon conversion of preferred
stock. Common share equivalents does not include shares from conversion of debt
since the number of shares are yet to be determined. As of December 31, 2005 and
2004, there were approximately 22,840,255 and 18,335,000 outstanding common
share equivalents, respectively, that were not included in the computation of
diluted net loss per common share as their effect would be anti-dilutive.

Revenue Recognition

The Company derives its revenue primarily from the sale of mobile emergency and
personal security systems and reagent stains.

The sale of mobile emergency and personal security systems may include the
security device, such as the MobilePal phone, and the related monitoring
service. If the sale includes both the device and the monitoring service,
revenue from the sale of the device is deferred and recognized ratably over the
life of the monitoring service contract. Revenue from the monitoring service
contract is recognized monthly as earned in accordance with the monitoring
service contract. If the sale is for the device only and does not include the
monitoring services, revenue, less reserves for returns, is recognized upon
shipment to the customer. The Company records reserves for estimated returns of
defective product. Amounts received in advance of shipment are recorded as
deferred revenue. Shipping and handling fees are included as part of net sales.
The related freight costs and supplies directly associated with shipping
products to customers are included as a component of cost of goods sold.

The sale of reagent stains is recognized when an agreement with the buyer
exists, the price is fixed or determinable, the product has been shipped, and
collection is reasonably assured.

(2)      INVENTORIES
         -----------

Substantially all items included in inventory were finished goods and consist of
the following as of December 31, 2005:

         Mobile emergency and personal security systems,
           net of reserve of $63,696                          $           7,244

         Reagent Stains                                                  30,925
                                                              -----------------
         Total inventory                                      $          38,169
                                                              =================

(3)      NOTES PAYABLE

Notes payable at December 31, 2005 consisted of the following:

Current liabilities:

                                       8
<PAGE>

Unsecured note payable to a corporation with interest at
5%.  The note was due December 20, 2005.  This
note is in default.                                                    $  95,830

Unsecured notes payable to former SecureAlert
shareholders, with interest at 5%, payable in
installments of $80,000 per month until paid in full.
These notes are currently in default.                                    169,676

Unsecured note payable to an entity.  The note has
a monthly payment of $1,985.  The loan bears no
interest, but has been imputed at 12%.  The note is
due September 18, 2006.   As of December 31, 2005,
the unamortized debt discount was $692.                                   15,191

Convertible notes payable to entities with interest at
8%.  The note is due February 28, 2006.  The note may
convert into Series C Convertible Preferred Stock at $1.12
per share.  A contingent beneficial conversion feature has
been calculated for a value of $303,572 and will be recognized
upon the of the closing of Series C Preferred Stock.                     500,000
                                                                       ---------

                                                                       $ 780,697
                                                                       =========
Long term liabilities:

Unsecured convertible note payable with interest
at 18% (effective interest rate of 29.83%), maturing
on September 16, 2008.  Three years of prepaid
interest has been paid through the issuance of
363,000 shares of restricted common stock valued
at $515,460.  The holder of the note may convert
any portion of the outstanding balance at the lower
of 50% of the fair value of the Company's common
stock or $0.40 per share. A beneficial conversion
feature of $363,000 was recorded.  As of December
31, 2005, the unamortized debt discount was $327,708.                  $  35,292

Unsecured convertible note payable with interest
at 18% (effective interest rate of 26.17%), maturing
on May 3, 2008.  Three years of prepaid interest
has been paid through the issuance of 127,500
shares of restricted common stock valued at $68,850.
The holder of the note may convert any portion of
the outstanding balance at the lower of 50% of
the fair value of the Company's common stock
or $0.40 per share. A beneficial conversion
feature of $127,500 was recorded.  As of
December 31, 2005, the unamortized debt  discount
was $99,166.                                                              28,334

Unsecured convertible notes payable with interest
at 18% (effective interest rate of 26.15%), and
maturity dates of March 7, 2008, April 7, 2008, and
August 14, 2008.  Three years of prepaid interest
has been paid through the issuance of 600,000
restricted shares of common stock valued at
$324,000. The holder of the note may convert
any portion of the outstanding balance at the
lower of 50% of the fair value of the Company's
common stock or $0.40 per share.  A beneficial
conversion feature of $320,000 was recorded.
As of December 31, 2005, the unamortized debt
discount was $264,931.                                                   335,069

                                       9
<PAGE>


Unsecured convertible notes payable with interest
at 18% (effective interest rate of 54.24%), and
maturity dates of May 2, 2008 and September 15,
2008.  Three years of prepaid interest has been
paid through the issuance of 150,000 shares of
restricted common stock valued at $125,000.  The
holder of the note may convert any portion of the
outstanding balance at the lower of 50% of the fair
value of the Company's common stock or $0.40
per share.  A beneficial conversion feature of
$150,000 was recorded.  As of December 31,
2005, the remaining debt discount was $122,917.                           27,083

Unsecured convertible notes payable with interest
at 18% (effective interest rate of 39.72%), and
maturity dates of June 15, 2008 and September
15, 2008.  Three years of prepaid interest has been
paid through the issuance of 1,280,000 shares of
restricted common stock valued at $883,600.  The
holder of the note may convert any portion of the
outstanding balance at 50% of the fair value of the
Company's common. As of December 31, 2005,
the unaccreted balance was $1,097,499.  These notes
have conversion features that are considered embedded
derivatives and therefore, are subject to derivative
accounting. (See Note 8)                                                 182,501

Unsecured convertible notes payable with interest
at 5% (effective interest rate of 31.86%), and
maturity dates of September 30, 2008.  Three years
of prepaid interest has been paid through the issuance
of 575,000 shares of restricted common stock valued
at $655,500.  The holder of the note may convert any
portion of the outstanding balance at the lower of 50%
of the fair value of the Company's common or $0.60 per
share. As of December 31, 2005, the unaccreted balance
was $527,083.  These notes have conversion features that
are considered embedded derivatives and therefore, are
subject to derivative accounting. (See Note 8)                            47,917
                                                                       ---------

                                                                       $ 656,196
                                                                       =========

(4)     BANK LINE OF CREDIT
        -------------------

As of December 31, 2005, the Company had $174,475 outstanding under a line of
credit with Zions First National Bank. The line of credit bears interest at
prime plus .25% (7.25%), matures on March 11, 2006, is limited to $175,000 plus
fees, and is secured by certificates of deposit which the Company holds as
restricted cash of $181,564.

(5)    RELATED PARTY LINE OF CREDIT AND NOTE
       -------------------------------------

As of December 31, 2005, the Company owed to ADP Management, an entity owned and
controlled by two of the Company's officers and directors $863, under a line of
credit agreement. Outstanding amounts on the line of credit accrue interest at


                                       10
<PAGE>

5.0% and are due in July 2006. During the three months ended December 31, 2005,
the net decrease in the related party line of credit was $16,752. The net
decrease consisted of net cash repayments during the quarter of $192,314 and net
increases of $175,562 related to a monthly management fee owed to ADP Management
and expenses incurred by ADP Management that are reimbursable by the Company. If
the Company is unable to pay the management fee and the reimbursable expenses in
cash, the related party line of credit is increased for the amount owed to ADP
Management.

The Company entered into a loan with an entity controlled by an employee of the
Company. The loan bears interest at 17%. An origination fee of $10,000 was added
to the principal balance owed under the note. Principal and interest were due
November 13, 2005. The first four months are interest only and the last three
months are interest and principal. This loan is secured by the stock and assets
of Volu-Sol Reagents Corporation, a wholly-owned subsidiary of RemoteMDx, Inc.
As of December 31, 2005, the balance net of the debt discount was $251,250. The
note has been extended for cash payments of $10,000 per month.

(6)      CONVERTIBLE DEBENTURES
         ----------------------

During the year ended September 30, 2004, the Company sold $1,450,000 of Series
B Convertible Debentures and $350,000 of Series C Convertible Debentures. The
Debentures are convertible automatically into shares of the Company's common
stock upon the closing of a qualified equity or debt offering with gross
proceeds of at least $5,000,000. Under the terms, the conversion price will
equal 80% of the fair value prior to closing the offering. The Debentures bear
interest at an annual rate of 10%, not including any original issue discount,
with interest during the first six months of $47,954 added to the principal
amount. Thereafter, interest payments will be made monthly in cash or, at the
sole option of the Company, in shares of Common Stock at a price of $0.54 per
share. The Debentures mature and are payable two years from each Closing,
subject to the conversion as indicated above. As of December 31, 2005, the
convertible debentures net of debt discount was $1,290,452.

(7)      PREFERRED STOCK
         ---------------

Series A 10 % Convertible Non-Voting Preferred Stock

During the three months ended December 31, 2005, a total of 4,221 shares of
Series A Preferred Stock were converted into 1,565,025 shares of common stock.
As of December 31, 2005, there were 21,786 shares of Series A Preferred Stock
outstanding, which represents 8,060,650 common stock equivalents at a conversion
rate of 370 for 1.

The holders of the Series A Preferred Stock are entitled to dividends at the
rate of 10 percent per year on the stated value of the Series A Preferred Stock
(or $200 per share), payable in cash or in additional shares of Series A
Preferred Stock at the discretion of the board of directors. Dividends are fully
cumulative and accrue from the date of original issuance. During the three
months ended December 31, 2005 and 2004, the Company recorded $124,461 and
$128,649, respectively, in dividends on Series A Preferred Stock.

The Company may, at its option, redeem up to two-thirds of the total number of
shares of Series A Preferred Stock at a redemption price of 133 percent of the
stated value of Series A Preferred Stock; however, the Company may designate a
different and lower redemption price for all shares of Series A Preferred Stock
called for redemption by the Company. Through December 31, 2005, the Company had
not exercised its option to redeem shares of Series A Preferred Stock.

Series B Convertible Preferred Stock

During the three months ended December 31, 2005, a total of 1,096,825 shares of
Series B Preferred Stock were converted into 5,652,381 shares of common stock.
As of December 31, 2005, there were 272,332 shares of Series B Preferred Stock
outstanding convertible into approximately 2,043,000 common shares.

SecureAlert, Inc. Preferred Shares

During the year ended September 30, 2005, and pursuant to Board of Director
approval, the Company amended the articles of incorporation of its wholly owned
subsidiary, SecureAlert, Inc., to establish 3,500,000 shares of preferred stock
designated as Series A Convertible Redeemable Non-Voting Preferred Stock. The
holders of shares of Series A Preferred Stock shall be entitled to receive
quarterly dividends out of any of SecureAlert's assets legally available
therefore, prior and in preference to any declaration or payment of any dividend
on the Common Stock of the SecureAlert, at the rate of $1.50 per day times the
number of SecureAlert's parolee contracts calculated in days during the quarter.
For example, if there were an average of 10,000 parolee contracts outstanding
during the quarter, the total dividend would be $1,350,000 ($1.50 X 90 days X

                                       11
<PAGE>

10,000 contracts) or $.385/Series A Preferred Stock. In no case will a dividend
be paid if the gross revenue per contract per day to SecureAlert averages less
than $4.50. Dividends will be paid in cash to the holders of record of shares of
Series A Preferred Stock as they appear on the books and records of SecureAlert
on such record dates not less than ten (10) days nor more than sixty (60) days
preceding the payment dates thereof, as may be fixed by the Board of Directors
of SecureAlert. As a group, all Series A Preferred Stock may be converted at the
holder's option at any time into an aggregate of 20% ownership of the common
shares of the SecureAlert, Inc. During the quarter ended December 31, 2005, the
Company sold 600,000 of these shares for $600,000. As of December 31, 2005,
there were 3,590,000 shares of SecureAlert Series A Preferred Stock.

The 600,000 shares of SecureAlert Series A Preferred Stock issued during the
quarter have an additional feature where the Company will buy back the
SecureAlert Series A Preferred Shares and pay the investor 15% interest should
the Company not have contracts for a total of 7,000 parolee units by March 31,
2006. There is doubt that the Company will secure 7,000 parolee contracts by
March 31, 2006; therefore, in accordance with SFAS No. 150, Accounting for
Certain Financial Instruments with Characteristics of Both Liabilities and
Equity, the redemption value of the redeemable shares has been recorded as a
liability. The Company has committed to collateralize these instruments with
600,000 free trading shares of its common stock. In addition, each holder
received an option to purchase 1 share of common stock with an exercise price of
$1.00 per share for each share of SecureAlert Series A Preferred Shares
received. The Black-Scholes model was used to determine the value for the
600,000 options issued. The value of the options was $443,515. The detachable
warrants were valued at $443,515 and the debt discount was prorated. As of
December 31, 2005, the unamortized debt discount was $241,590.

(8)      DERIVATIVES
         -----------

The Company does not hold or issue derivative instruments for trading purposes.
However, the Company has convertible notes payable that contain embedded
derivatives that require separate valuation from the convertible notes. The
Company recognizes these derivatives as liabilities in its balance sheet and
measures them at their estimated fair value, and recognizes changes in their
estimated fair value in earnings (losses) in the period of change. The Company
has estimated the fair value of these embedded derivatives using the
Black-Scholes model based on the historical volatility of its common stock over
the past three years. The fair value of derivative instruments are re-measured
each quarter.

During the three months ended December 31, 2005 and the year ended September 30,
2005, the Company issued convertible notes payable containing embedded
derivatives. The Company received $1,855,000 from these convertible notes and
issued 1,855,000 shares of common stock valued at $1,539,100 for three years of
prepaid interest. The carrying value of these convertible notes payable as of
December 31, 2005 was $230,418. The carrying value will be increased each
quarter over the three year period as the accretion related to the embedded
derivative is recorded until the carrying value equals the face value of
$1,855,000. As of December 31, 2005, the derivative instruments had a total fair
value of $2,926,527.

(9)      COMMON STOCK
         ------------

During the three months ended December 31, 2005, the Company issued 9,287,246
shares of common stock as follows:

o        325,000 shares were issued for services performed for a value of
         $327,000.

o        694,840 shares were issued in connection with debt and interest on
         notes payable for a value of $784,416.

o        1,050,000 shares were issued for $700,000 in cash, net commission of
         $35,000

o        7,217,406 shares were issued for conversion of Series A and B Preferred
         Stock.

Common Stock Subject to Redemption

The Company has 32,000 common shares outstanding that are redeemable at the
option of the holder with a redeemable value of $96,000. The Company has not yet
been released from the $96,000 obligation. In accordance with SFAS No. 150,
Accounting for Certain Financial Instruments with Characteristics of both
Liabilities and Equity, the redemption value of the redeemable shares has been
recorded as a liability.

                                       12
<PAGE>

Common Stock Options and Warrants

As of December 31, 2005, 9,341,649 of the 13,266,649 outstanding options and
warrants were vested with a weighted average exercise price of $0.60 per share.
For the three months ended December 31, 2005, 657,500 options were issued with
an exercise price of $1.00 per share. These options were issued in connection
with debt and SecureAlert Series A Preferred stock.

(10)     SEGMENT INFORMATION

The Company is organized into two business segments based primarily on the
nature of the Company's products. The Reagents segment is engaged in the
business of manufacturing and marketing medical diagnostic stains, solutions and
related equipment to hospitals and medical testing labs. The SecureAlert segment
is engaged in the business of developing, distributing and marketing mobile
emergency and personal security systems to distributors and consumers. Other
(unallocated) loss consists of research and development, selling, general and
administrative expenses related to the Company's corporate activities, including
remote health monitoring and market and business development activities.

The following table reflects certain financial information relating to each
reportable segment for each of the three-month periods ended December 31, 2005
and 2004:

                                                       Three Months Ended
                                                          December 31,
                                               --------------    ---------------
                                                     2005             2004
                                               --------------    ---------------
Sales to external customers:
     SecureAlert                               $       77,060    $       68,945
     Reagents                                         142,433           138,574
                                               --------------    ---------------
                                               $      219,493    $      207,519
                                               --------------    ---------------
Net (loss) income from operations  :
     SecureAlert                               $   (1,349,620)   $     (552,671)
     Reagents                                          23,830            14,314
     Other (unallocated)                           (2,119,963)         (777,469)
                                               --------------    ---------------
                                               $   (3,445,753)   $   (1,315,826)
                                               --------------    ---------------
Identifiable assets:
     SecureAlert                                      879,205
     Reagents                                         306,310
     Other (unallocated)                              802,863
                                               --------------
                                               $    1,988,378
                                               ==============

(11)    SUBSEQUENT EVENTS
        -----------------

Subsequent to December 31, 2005, the Company has entered into the following
agreements:

o        $400,000 of the Convertible Promissory Bridge Notes have been redeemed
         by the Company pursuant to the terms of the Notes for $418,668 in cash.

o        The Board of Directors have approved the issuance of Series C Preferred
         Stock. Series C Preferred Stock has the following features: cost of
         $1.12 per share, an annual dividend of 8%, voting rights and one share
         of Series C Preferred Stock converts into two shares of common stock.

o        The Company has received $500,000 from two entities from the issuance
         of debt convertible into Series C Preferred Stock.


                                       13
<PAGE>

Item 2.  Management's Discussion and Analysis or Plan of Operation

Special Note Regarding Forward-looking Information

Certain statements in this Item 2 "Management's Discussion and Analysis or Plan
of Operation" are "forward-looking statements" within the meaning of the
Securities Exchange Act of 1934 (the "Exchange Act"). For this purpose, any
statements contained or incorporated in this report that are not statements of
historical fact may be deemed to be forward-looking statements. The words,
"believes," "will," "plans," "anticipates," "expects" and similar expressions
are intended to identify forward-looking statements. A number of important
factors could cause the actual results of the Company to differ materially from
those anticipated by forward-looking statements. These factors include those set
forth under the caption "Risk Factors" in Item 6 - "Management's Discussion and
Analysis or Plan of Operation" in the Company's Annual Report on Form 10-KSB for
the year ended September 30, 2005.

General

RemoteMDx, Inc. ("RemoteMDx" or the "Company") markets and sells patented
wireless location technologies and the related monitoring services, and
develops, markets and sells personal security, senior supervision, and health
monitoring devices and monitoring services. The RemoteMDx products and
monitoring services feature wireless products that utilize GPS and cellular
technologies in conjunction with a monitoring center. These devices include a
mobile emergency response device, MobilePAL(TM), which can locate persons in
distress, no matter where they may be, and dispatch the closest emergency
service to their location. The Company has recently developed and has numerous
pre-production models of a tracking device, TrackerPAL, which will be used to
monitor convicted offenders in the criminal justice system. The Company believes
that its technologies and services will benefit the healthcare and penal system
as they allow both care providers and law enforcement officials to respond
immediately to a medical event or criminal activity. Our customers will be able
to better monitor and manage their own chronic disease and medical conditions,
giving peace of mind to them and their loved ones and care providers.

The Company's primary health monitoring market consists of approximately 35
million Americans over the age of sixty-five. Of these 35 million seniors, it is
estimated that 9.7 million currently live alone. However, in most cases, the
Company anticipates that senior customers will not purchase the Company's
products for themselves. Instead, based on the Company's experience, the Company
believes that it is more effective to target the children or caregivers of these
seniors. Therefore, the primary target market is children, friends, and spouses
of these individuals.

Additionally, the Company has identified a growing need in the parole/probation
market, which in 2003, consisted of approximately 4.9 million adults in the
criminal justice system. In order to meet the needs of this growing demand, the
Company has developed TrackerPAL that works in conjunction with our monitoring
center. Through the date of this report, the Company has not received any
revenue from this market.

We also sell medical diagnostic stains, solutions, and equipment through a
wholly owned subsidiary, Volu-Sol Reagents Corporation ("Reagents").

We derive our revenues from the following sources:

o        Medical Diagnostic Stains - We sell medical diagnostic stains and
         equipment to laboratories throughout the United States. The Company
         anticipates that these sales will decrease in the futures as a
         percentage of total sales.

o        Monitoring Activation - We sell our MobilePAL(TM) and anticipate
         leasing our TrackerPAL devices as part of a monitoring contract, with
         prepaid activation charges.

o        Monitoring Services - Following activation, our MobilePAL and
         TrackerPAL customers pay a monthly monitoring fee and fees for
         additional services offered by our contract providers or by us.

In addition to the foregoing sources, we have contractual rights to receive
royalty revenues from a license agreement with Matsushita Electric Works ("MEW")
and from sales of telematic products and services under marketing agreements.
"Telematic" means any wireless communication system designed for the collection
and dissemination of data. To date these royalty agreements have not produced
any royalty income.


                                       14
<PAGE>

Our Strategy

Our goal is to establish the Company as a significant marketer and distributor
of leading technology and services we have developed for the mobile personal
emergency, the parolee and probation market, and the health monitoring
industries. Until the beginning of calendar 2003, most of our revenues were
provided by the distribution of consumer electronics through a business acquired
by a wholly owned subsidiary, SecureAlert, Inc. ("SecureAlert"), in July 2001.
With our decision to refocus our business and product development efforts on the
mobile health and emergency monitoring and law enforcement industries, which
previously comprised a smaller part of our business, we discontinued the
distribution of consumer electronics and automotive telematic products during
2003.

Critical Accounting Policies

In Note 1 to the audited financial statements for the fiscal year ended
September 30, 2005 included in the Company's Form 10-KSB, the Company discusses
those accounting policies that are considered to be significant in determining
the results of operations and its financial position. The Company believes that
the accounting principles utilized by it conform to generally accepted
accounting principles in the United States of America.

The preparation of consolidated financial statements requires management to make
significant estimates and judgments that affect the reported amounts of assets,
liabilities, revenues and expenses. By their nature, these judgments are subject
to an inherent degree of uncertainty. On an on-going basis, the Company
evaluates its estimates, including those related to bad debts, inventories,
intangible assets, warranty obligations, product liability, revenue, and income
taxes. The Company bases its estimates on historical experience and other facts
and circumstances that are believed to be reasonable, and the results form the
basis for making judgments about the carrying value of assets and liabilities.
The actual results may differ from these estimates under different assumptions
or conditions.

With respect to inventory reserves, revenue recognition and allowance for
doubtful accounts, the Company applies the following critical accounting
policies in the preparation of its financial statements:

Inventory Reserves

The nature of the Company's business requires it to maintain sufficient
inventory on hand at all times to meet the requirements of its customers. The
Company record finished goods inventory at the lower of standard cost, which
approximates actual costs (first-in, first-out) or market. Raw materials are
stated at the lower of cost (first-in, first-out), or market. General inventory
reserves are maintained for the possible impairment of the inventory. Impairment
may be a result of slow moving or excess inventory, product obsolescence or
changes in the valuation of the inventory. In determining the adequacy of its
reserves, the Company analyzes the following, among other things:

o        Current inventory quantities on hand;

o        Product acceptance in the marketplace;

o        Customer demand;

o        Historical sales;

o        Forecast sales;

o        Product obsolescence; and

o        Technological innovations.

Any modifications to these estimates of reserves are reflected in the cost of
goods sold within the statement of operations during the period in which such
modifications are determined necessary by management.

Revenue Recognition

The Company derives its revenue primarily from the sale of mobile emergency and
personal security systems and reagent stains.

                                       15
<PAGE>

The sale of mobile emergency and personal security systems may include the
security device, such as the MobilePal phone, and the related monitoring
service. If the sale includes both the device and the monitoring service,
revenue from the sale of the device is deferred and recognized ratably over the
life of the monitoring service contract. Revenue from the monitoring service
contract is recognized monthly as earned in accordance with the monitoring
service contract. If the sale is for the device only and does not include the
monitoring services, revenue, less reserves for returns, is recognized upon
shipment to the customer. The Company records reserves for estimated returns of
defective product. Amounts received in advance of shipment are recorded as
deferred revenue. Shipping and handling fees are included as part of net sales.
The related freight costs and supplies directly associated with shipping
products to customers are included as a component of cost of goods sold.

The sale of reagent stains is recognized when an agreement with the buyer
exists, the price is fixed or determinable, the product has been shipped, and
collection is reasonably assured.

Impairment of Long-lived Assets

The Company reviews its long-lived assets for impairment when events or changes
in circumstances indicate that the book value of an asset may not be
recoverable. The Company evaluates, at each balance sheet date, whether events
and circumstances have occurred which indicate possible impairment. The Company
uses an estimate of future undiscounted net cash flows of the related asset or
group of assets over the estimated remaining life in measuring whether the
assets are recoverable. If the carrying amount of an asset exceeds its estimated
future cash flows, an impairment charge is recognized for the amount by which
the carrying amount exceeds the estimated fair value of the asset. Impairment of
long-lived assets is assessed at the lowest levels for which there are
identifiable cash flows that are independent of other groups of assets. Assets
to be disposed of are reported at the lower of the carrying amount or fair
value, less the estimated costs to sell. In addition, depreciation of the asset
ceases. During the periods ended December 31, 2005 and 2004, no impairment of
long-lived assets was recorded.

Accounting for Stock-based Compensation

The Company accounts for stock-based compensation issued to employees and
directors under Accounting Principles Board Opinion ("APB") No. 25, "Accounting
for Stock Issued to Employees," and related interpretations. Under APB No. 25,
compensation related to stock options, if any, is recorded if an option's
exercise price on the measurement date is below the fair value of the company's
common stock and amortized to expense over the vesting period. Compensation
expense for stock awards or purchases, if any, is recognized if the award or
purchase price on the measurement date is below the fair value of the common
stock and is recognized on the date of award or purchase. Statement of Financial
Accounting Standards ("SFAS") No. 123, "Accounting for Stock Based
Compensation," requires pro forma information regarding net loss and net loss
per common share as if the company had accounted for its stock options granted
under the fair value method.

The Company accounts for stock-based compensation issued to persons other than
employees using the fair value method in accordance with SFAS No. 123 and
related interpretations. Under SFAS No. 123, stock-based compensation is
determined as either the fair value of the consideration received or the fair
value of the equity instruments issued, whichever is more reliably measurable.
The measurement date for these issuances is the earlier of either the date at
which a commitment for performance by the recipient to earn the equity
instruments is reached or the date at which the recipient's performance is
complete.

Three Months Ended December 31, 2005 Compared to Three Months Ended December 31,
2004

Net Sales

For the three months ended December 31, 2005, the Company had net sales of
$219,493, compared to $207,519 for the three months ended December 31, 2004, an
increase of $11,974. The increase in net sales resulted primarily from focusing
on the mobile emergency and personal security systems.

SecureAlert had net sales of $77,060 during the three months ended December 31,
2005 compared with $68,945 during the comparative period of 2004. These sales
consisted of mobile emergency and personal security systems. No customer
accounted for 10% or more of sales by SecureAlert during the period.

Reagents had revenues for the three months ended December 31, 2005 of $142,433,
compared to $138,574 during the quarter ended December 31, 2004. The Company
anticipates that Reagents' sales will decrease in the future as a percentage of
total sales. Fisher Scientific was a significant customer of Reagents,
accounting for 30% of Reagents' sales during the period. No other Reagents
customer accounted for 10% or more of its sales.

                                       16
<PAGE>

Cost of Goods Sold

For the three months ended December 31, 2005, cost of goods sold was $107,143
compared to $147,084 during the three months ended December 31, 2004, a decrease
of $39,941. During the fiscal year ended September 30, 2005, the Company
recorded an impairment of the GPS2000 mobile phone inventory based on the
estimated recoverability of the inventory. Therefore, the sales of such phones
during the period ended December 31, 2005, resulted in a lower cost of goods
sold per unit based on the impairment. SecureAlert's cost of goods sold totaled
$34,498 or 45% of SecureAlert's net sales during the three months ended December
31, 2005. The mobile emergency and personal security products have generally
been sold below cost in an effort to secure a recurring revenue stream under
monthly monitoring contracts. Reagents' cost of goods sold was $72,645 or 51% of
Reagent's net sales during the three months ended December 31, 2005, compared to
$72,099 or 52% of Reagent's net sales for the same period during the prior
fiscal year. The decrease as a percentage of net sales was primarily due to a
reduction in labor costs.

Research and Development Expenses

For the three months ended December 31, 2005, research and development expenses
were $729,933 compared to $204,730 in the previous year period, an increase of
$525,203. This increase in research and development expenses consisted primarily
of expenses associated with the development of SecureAlert's TrackerPAL device.

Selling, General and Administrative Expenses

During the three months ended December 31, 2005, selling, general and
administrative expenses were $1,743,612 compared to $933,335 during the three
months ended December 31, 2004. The increase of $810,277 relates primarily to an
increase of travel, consulting and marketing costs. Travel expense increased
from $15,173 during the three months ended December 31, 2004 to $96,475 in the
comparable period in 2005. The Company incurs significant travel expenses in the
development and marketing of its products as well as it continues efforts to
raise additional capital through the issuance of debt or equity instruments.
Consulting expense increased from $151,475 in the three months ended December
31, 2004 to $710,831 in the comparable period in 2005. The majority of the
consulting expense for the 2005 period is related to stock and stock options
issued to consultants for the development of the wireless technology in the
Company's products and marketing services.

Interest Income and Expense

During the three months ended December 31, 2005, interest expense totaled
$596,910, compared to $238,983 in the three months ended December 31, 2004.
Non-cash interest expense of $553,510 for the three months ended December 31,
2005 consists mainly of the following: $154,584 of accretion from the issuance
of convertible debt with embedded derivatives, $335,560 for the amortization of
the debt discount, and approximately $63,366 related to accrued interest on the
convertible debentures. Non-cash interest of $194,398 for the three months ended
December 31, 2004 related to the issuance of warrants in connection with new
debt of $133,398, amortization of the debt discount related to the convertible
debentures of $27,000, and accrued interest on convertible debentures of
$34,000.

Liquidity and Capital Resources

The Company is unable to finance its operations solely from cash flows from
operating activities. During the three months ended December 31, 2005, the
Company financed its operations primarily through borrowings, sale of common
stock and the sale of preferred stock of a wholly-owned subsidiary.

As of December 31, 2005, the Company had unrestricted cash of $ 1,212,968 and a
working capital deficit of $6,449,003, compared to unrestricted cash of $416,036
and a working capital deficit of $5,217,466 at September 30, 2005.

During the three months ended December 31, 2005, the Company's operating
activities used cash of $1,861,907, compared to cash of $544,240 used during the
three months ended December 31, 2004. The increase was primarily a result of
research and development costs of SecureAlert's TrackerPal device.

The Company used cash of $17,369 for investing activities during the three
months ended December 31, 2005.

                                       17
<PAGE>

The Company's financing activities during the three months ended December 31,
2005 provided cash of $2,676,208 compared to $602,904 during the three months
ended December 31, 2004. During the three months ended December 31, 2005, the
Company raised $600,000 through the sale of preferred stock of its wholly-owned
subsidiary, SecureAlert, $1,075,000 in debt financing, and $700,000 through the
sale of common stock during the three months ended December 31, 2005.

The Company incurred a net loss of $3,445,753 during the three months ended
December 31, 2005. As of December 31, 2005, the Company had a net tangible
stockholders' deficit of $9,670,444 and an accumulated deficit of $83,909,448.
These factors, as well as the risk factors set out in the Company's annual
report on Form 10-KSB for the year ended September 30, 2005, raise substantial
doubt about the Company's ability to continue as a going concern. The unaudited
condensed consolidated financial statements included in this report do not
include any adjustments that might result from the outcome of this uncertainty.
The Company's plans with respect to this uncertainty include the conversion of a
significant portion of its outstanding debt and other obligations to equity, as
well as raising capital from the sale of the Company's common stock or other
debt and equity securities.

There is no assurance that the Company will be successful in its plans to raise
capital, convert debt to equity or meet its current financial obligations. There
has been no adjustment to the financial statements included in this report
should management's plans not be met.

Item 3.   Controls and Procedures

Evaluation of Disclosure Controls and Procedures. We maintain disclosure
controls and procedures designed to ensure that information required to be
disclosed in our reports filed under the Securities Exchange Act of 1934, as
amended (the Exchange Act), is recorded, processed, summarized, and reported
within the required time periods, and that such information is accumulated and
communicated to our management, including our Chief Executive Officer and Chief
Financial Officer, as appropriate, to allow for timely decisions regarding
disclosure.

As required by Rule 13a-15(b) under the Exchange Act, we conducted an
evaluation, under the supervision of our Chief Executive Officer and Chief
Financial Officer, of the effectiveness of our disclosure controls and
procedures as of December 31, 2005. In our evaluation we identified deficiencies
that existed in the design or operation of our internal control over financial
reporting that we and our independent registered public accounting firm
considered to be "material weaknesses." A material weakness is a significant
deficiency or combination of significant deficiencies that results in more than
a remote likelihood that a material misstatement of the annual or interim
financial information will not be prevented or detected.

The deficiencies in our internal control over financial reporting related to the
failure to properly disclose equity and debt transactions. The deficiencies were
detected in the evaluation process and the transactions have been appropriately
recorded and disclosed in this Form 10-QSB. In addition, we have not created a
"Disclosure Controls Committee" to monitor and follow up on our processes to
assure disclosures are complete and accurate; however, we intend to have such a
committee in place by October 1, 2006. We are in the process of improving our
internal control over financial reporting in an effort to resolve these
deficiencies through improved supervision and training of our accounting staff,
but additional effort is needed to fully remedy these deficiencies. Our
management, audit committee, and directors will continue to work with our
auditors and outside advisors to ensure that our controls and procedures are
adequate and effective.

Based on the matter identified above, our Chief Executive Officer and Chief
Financial Officer concluded that our disclosure controls and procedures were not
effective. These deficiencies have been disclosed to our Audit Committee.

Changes in Internal Controls. There has been no change in our internal control
over financial reporting during the quarter ended December 31, 2005 that has
materially affected, or is reasonably likely to materially affect, our internal
control over financial reporting. Since the most recent evaluation date, there
have been no significant changes in our internal control structure, policies,
and procedures or in other areas that could significantly affect our internal
control over financial reporting.

Recent Developments



                                       18
<PAGE>

The Company is exploring the possibility of raising additional capital through
the sale of a new series of preferred stock, which would be designated as Series
C Preferred Stock. Conditions that likely would need to be met prior to the
issuance of such preferred stock would include, but not be limited to receiving
approval of the holders of the Company's outstanding Series A and Series B
Preferred Stock, and the filing of appropriate amendments to the Company's
Articles of Organization to provide for the new series of preferred stock. There
can be no guarantee that the Company will be able to close the contemplated
transaction, or that the Company will be able to enter into a transaction on
terms that are satisfactory to the Company.

In addition,  the Company has received an additional  $500,000 from two entities
and has issued two  promissory  notes each in the principal  amount of $250,000,
which are convertible into Series C Preferred  Stock.  These  convertible  notes
bear interest at 8% and are due on February 28, 2006. The notes may convert into
Series C Convertible Preferred Stock at $1.12 per share.


                           PART II. OTHER INFORMATION

Item 2.  Changes in Securities and Use of Proceeds

During the three months ended December 31, 2005, the Company issued 9,287,246
shares of common stock without registration of the offer and sale of the
securities under the Securities Act of 1933, as amended, as follows:

o        325,000 shares were issued for services performed.

o        694,840 shares were issued in connection with debt and interest on
         notes payable.

o        1,050,000 shares were issued for $700,000 in cash.

o        7,217,406 shares were issued for conversion of Preferred Stock.

In each of these transactions the securities were issued to individuals or
entities that were "accredited investors" as that term is used in Rule 501 under
Regulation D of the Securities Act of 1933, as amended (the "Securities Act").
The issuance of the securities was accomplished without registration under the
Securities Act in reliance on the exemptions from the registration requirements
of the Securities Act afforded by Section 4(2) and Rule 506 of Regulation D
under the Securities Act.

Item 5.  Other Information

None

Item 6.  Exhibits

Exhibit Number                  Title of Document
--------------                  -----------------

10.01         Distribution and Separation Agreement (incorporated by reference
              to the Company's Registration Statement and Amendments thereto on
              Form 10-SB, effective December 1, 1997)

10.02         1997 Stock Incentive Plan of the Company, (incorporated by
              reference to the Company's Registration Statement and Amendments
              thereto on Form 10-SB, effective December 1, 1997)

10.03         1997 Transition Plan (incorporated by reference to the Company's
              Registration Statement and Amendments thereto on Form 10-SB,
              effective December 1, 1997).

10.04         Securities Purchase Agreement for $1,200,000 of Series A Preferred
              Stock (incorporated by reference to the Company's Registration
              Statement and Amendments thereto on Form 10-SB, effective December
              1, 1997)

                                       19
<PAGE>

10.05         Securities Purchase Agreements with ADP Management and James
              Dalton (previously filed)

10.06         Agreement and Plan of Merger (SecureAlert) (previously filed as
              exhibit to Current Report on Form 8-K)

10.07         Loan Agreement (as amended) dated June 2001 between ADP Management
              and the Company (incorporated by reference to the Company's annual
              report on Form 10-KSB for the year ended September 30, 2001)

10.08         Amended and Restated Loan and Security Agreement (SunTrust Bank
              and SecureAlert), dated August 3, 2001 (incorporated by reference
              to the Company's annual report on Form 10-KSB for the year ended
              September 30, 2001)

10.09         Amended and Restated Loan and Security Agreement (SunTrust Bank
              and SecureAlert), dated January 24, 2002 (filed as an exhibit to
              the Company's quarterly report on Form 10-QSB for the quarter
              ended December 31, 2001)

10.10         Amended and Restated Loan and Security Agreement (SunTrust Bank
              and SecureAlert) dated March 1, 2002 (filed as an exhibit to the
              Company's quarterly report on Form 10-QSB for the quarter ended
              December 31, 2001)

10.11         Loan Agreement (as amended and extended) dated March 5, 2002
              between ADP Management and the Company, effective December 31,
              2001 (filed as an exhibit to the Company's quarterly report on
              Form 10-QSB for the quarter ended December 31, 2001)

10.12         License Agreement between RemoteMDx, Inc. and SecureAlert, Inc. as
              licensor and Matsushita Electric Works, Ltd., as licensee, (April
              12, 2002) (previously filed)

10.13         Agreement between the Company and SAE, (previously filed)

10.14         Agreement between the Company and SecureAlert Telematics, with
              amendments, (previously filed)

10.15         Senior Secured  Convertible  Promissory  Note,  dated December 22,
              2005, payable to Anasazi Partners III, LLC.

10.16         Senior Secured  Convertible  Promissory  Note,  dated December 22,
              2005, payable to Clydesdale Partners, LLC.

10.17         Senior  Secured  Convertible  Promissory  Note,  dated February 1,
              2006, payable to Anasazi Partners III, LLC.

10.18         Senior  Secured  Convertible  Promissory  Note,  dated February 1,
              2006, payable to Clydesdale Partners, LLC.

31.1          Certification of President and Chief Executive Officer under
              Section 302 of Sarbanes-Oxley Act of 2002

31.2          Certification of Chief Financial Officer under Section 302 of
              Sarbanes-Oxley Act of 2002

32            Certification under Section 906 of Sarbanes-Oxley Act of 2002



                                       20
<PAGE>


                                   SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused
this report, as amended, to be signed on its behalf by the undersigned,
thereunto duly authorized.

                                               REMOTEMDX, INC.



Date: February 14, 2006                        By: /s/ David G. Derrick
                                               ------------------------
                                                     David G. Derrick,
                                                     Chief Executive Officer




Date: February 14, 2006                        By: /s/ Michael G. Acton
                                               ------------------------
                                               Michael G. Acton,
                                               Principal Accounting Officer



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