<PAGE>

                                  FORM 10-QSB
                      SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549

             [X] Quarterly Report Pursuant to Section 13 or 15(d)
                    of the Securities Exchange Act of 1934

                 For the quarterly period ended March 31, 2001
                                                --------------

                                      OR

             [_] 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 0-21384
                                               -------

                         KAIRE HOLDINGS INCORPORATED
                         ---------------------------
            (Exact name of registrant as specified in its charter)

          Delaware                                            13-3367421
 -------------------------------                           ----------------
 (State or other jurisdiction of                           (I.R.S. employer
 incorporation or organization)                         identification number)

        7348 Bellaire Ave, North Hollywood California            91605
       ----------------------------------------------------------------
       (Address of principal executive offices)              (Zip Code)

      Registrant's Telephone number, including area code: (818) 255-4996
                                                          --------------

                     INTERACTIVE MEDICAL TECHNOLOGIES LTD.
                     -------------------------------------
 (former, name, address and former fiscal year, if changed since last report)

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the 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 _             No  X
                                                           ---

State the number of shares outstanding of each of the Registrant's classes of
common stock, as of the latest practicable date.

                                                         Outstanding at
            Class of Common Stock                        March 31, 2001
            ---------------------                       ---------------
               $.001 par value                         126,765,033 shares

            Transitional Small Business Disclosure Format   Yes ___   No X
                                                                        ---
                                      -1-
<PAGE>

                                  FORM 10-QSB
                      Securities and Exchange Commission
                            Washington, D.C. 20549

                          KAIRE HOLDINGS INCORPORATED

                                     Index

PART I - FINANCIAL INFORMATION

         Item 1.  Consolidated Financial Statements

                  Condensed Consolidated Balance Sheets at
                    December 31, 2000 and March 31, 2001 (unaudited)


                  Condensed Consolidated Statements of Operations for the three
                    months ended March 31, 2000 (unaudited) and 2001 (unaudited)

                  Condensed Consolidated Statements of Cash Flows for the three
                    months ended March 31, 2000(unaudited) and 2001 (unaudited)

                  Notes to Condensed Consolidated Financial Statements

         Item 2.  Management's Discussion and Analysis of Financial Condition
                    and Results of Operations.


PART II. - OTHER INFORMATION

         Item 1.  Legal Proceedings

         Item 2.  Changes in Securities and Use of Proceeds

         Item 3.  Defaults Upon Senior Securities:

         Item 4.  Submission of Matters of a Vote to Security Holders

         Item 5.  Other Information

         Item 6.  Exhibits and Reports on Form 8-K

SIGNATURES

                                      -2-
<PAGE>

                         PART I. FINANCIAL INFORMATION
                         -----------------------------


ITEM I. FINANCIAL STATEMENTS

                 KAIRE HOLDINGS INCORPORATED AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEET
                     March 31, 2001 and December 31, 2000


                        ASSETS                        03/31/01     12/31/00
                                                     ----------   ----------
     Current assets
        Cash and Cash equivalents                        14,817      311,716
        Accounts receivable, net of allowance for
          doubtful accounts of $397,362               1,873,877    1,046,682
        Inventory                                       400,512      385,219
        Deposits                                          4,750        4,750
        Other Current Assets                             14,179       14,179
                                                     ----------   ----------
               Total current assets                   2,308,135    1,762,546

     Noncurrent Assets
        Debt issuance costs                              76,541       76,541
        Property and Equipment, net
          of Accumulated Depreciation                   275,842      278,147
        Note Receivable - Related Party                 185,150      280,500
        Investments                                      30,028       30,028
        Other non-current Assets                          5,000        5,000
        Goodwill, net                                 9,083,782    9,202,267
                                                     ----------   ----------
                  Total assets                       11,964,478   11,635,029
                                                     ==========   ==========

                                  (Continued)

  The accompanying notes are an integral part of these financial statements.

                                      -3-
<PAGE>

                 KAIRE HOLDINGS INCORPORATED AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEET
                     March 31, 2001 and December 31, 2000


                      LIABILITIES AND
                    SHAREHOLDERS' EQUITY           03/31/01        12/31/00

Current liabilities
   Accounts payable and accrued expenses              2,164,372       1,960,029
   Income tax payable                                       800           4,000
   Due to Stason Biotech                                175,000         175,000
   Sales tax payable                                      5,756           5,727
   Note payable- Acquisition                          1,074,881       1,301,000
   Capital Leases-short Term                             30,734          73,262
                                                 ---------------- --------------
     Total current liabilities                        3,451,543       3,519,018

Convertible notes payable and debentures              1,321,000         821,000
Capital leases-Long term                                166,374         123,847
                                                 ---------------- --------------
     Total liabilities                                4,938,918       4,463,865
                                                 ---------------- --------------
Shareholders' equity
   Common Stock, $0.01 par value
   400,000 shares authorized; 126,765,033 and
   117,765,033 shares issued and outstanding,
   respectively                                         126,765         117,765
   Common Stock, Subscriptions Receivable               (90,000)        (20,000)
   Additional paid-in capital                        41,095,092      40,671,855
   Current earnings (loss)                             (507,823)             --
   Accumulated deficit                              (33,598,474)    (33,598,456)
                                                 ---------------- --------------
   Total shareholders' equity                         7,025,560       7,171,164
                                                 ---------------- --------------

   Total liabilities and shareholders' equity        11,964,478      11,635,029
                                                 ================ ==============

  The accompanying notes are an integral part of these financial statements.

                                      -4-
<PAGE>

             INTERACTIVE MEDICAL TECHNOLOGIES LTD. AND SUBSIDARIES
                     CONSOLIDATED STATEMENTS OF OPERATION
                       For the Quarters Ended March 31,


                                             Unaudited        Unaudited
                                                  2000             2001
Revenues                                 $      61,060    $   3,777,036

                                         $      61,060    $   3,777,036

Cost of good sold                        $      31,070    $   3,115,338

Gross Profit                             $      29,990    $     661,698

Operating Expenses
Depreciation and Amortization            $           -    $     120,790
Selling, general and administrative      $     235,452    $     776,797
        Total Operating Expenses         $     235,452    $     897,587

Profit from Operations (loss)            $    (205,462)   $    (235,890)

Other Income and (Expense)
Interest expense                         $     (14,544)   $     (31,533)
Other Expenses                           $    (185,000)   $    (240,000)
Other Income                             $           -    $           -
   Total interest expense and other      $    (199,544)   $    (271,533)

     Loss before provision for state     $    (405,006)   $    (507,423)

Provision for state income taxes         $         400    $         400

Net Loss                                 $    (405,406)   $    (507,823)

     Basic Loss per Share                $       (0.01)   $      (0.004)

   Diluted Loss per Share                $       (0.01)   $      (0.004)

Weighted average shares outstanding         40,564,256       111,286,791

          See the accompanying notes to these consolidated statements

                                      -5-
<PAGE>

                  KAIRE HOLDINGS INCORPORATED AND SUBSIDARIES
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                       For the Quarters Ended March 31,

<TABLE>
<CAPTION>
                                                                        Unaudited             Unaudited
                                                                          2000                   2001
<S>                                                                     <C>                   <C>
Increase (decrease) in cash and cash Equivalents:
Net (loss)                                                              (405,406)              (507,823)
Adjustments to reconcile net loss to net cash
   used in operating activities:
        Depreciation/Amortization Expense                                    416                  2,305
        Amortization of Goodwill                                                                118,485
        Allowance for Bad Debts
        Common Stock Issued in Services                                        0                      0
        Common Stock Issued for professional Services                     94,500                 60,000
        Common Stock Issued for Interest on Notes                         14,543                      0
        Common Stock for Conversion of Notes Payable                      26,546                      0
        Common Stock Issued for other Compensation                       185,000                      0
        Charge related to beneficial conversion feature of
        Convertible notes payable/debentures                              10,000                      0

        Non cash other expenses (income)                                       0                212,220
(Increase) decrease in:
        Accounts receivable                                               (7,101)              (827,195)
        Deposits                                                          (5,000)
        Prepaid expenses and other assets                                      0                      0
        Inventories                                                            0                (15,293)
Increase (decrease) in:
        Accounts payable and accrued expenses                            (82,349)               (99,008)
        Accrued interest on convertible notes                                                    31,533

Net cash used in operating activities                                   (168,851)            (1,024,776)

Cash flows from investing activities
        Purchase of furniture,equipment and leases                       (14,961)                42,527
        Purchase of Goodwill                                                   0
Investment in affiliates                                                  (5,000)
Net cash used in investing activities                                    (19,961)                42,527

Cash flows from financing activities
        Other Investments                                                                             0
        Due to Stason biotech                                                  0                      0
        Note Receivable - related party                                                          95,350
        Proceeds from issuance of common stock                           640,599                 90,000
        Proceeds from issuance of convertible notes                                             500,000
                Net cash provided by financing activities                640,599                685,350

Net decrease in cash and cash equivalents                                451,787               (296,899)

Cash and cash equivalents, beginning of period                           130,668                311,716

Cash and cash equivalents, end of period                                 582,455                 14,817
</TABLE>



             The accompanying notes are an integral part of these
                             financial statements.

                                      -6-
<PAGE>

                 KAIRE HOLDINGS INCORPORATED and SUBSIDIARIES
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  (unaudited)
                                March 31, 2001


1.   Organization and Line of Business
--------------------------------------

     Since its formation in Delaware in 1986, Kaire has continuously been
involved in the health care market segment as a provider of unique quantitative
laboratory products and services to researchers, and specialized pharmacy care
to defined disease communities.

     Kaire's primary business is providing specialized pharmacy care to patients
living in board and care facilities through its Classic Care Pharmacy, and also
to HIV patients through its YesRx Health Advocate Program.

     YesRx.com, Inc.
     ---------------

     Kaire formed YesRx in November 1999 as an Internet based e-commerce
pharmacy and drug store that provided a full range of traditional pharmacy and
drug store services supported by extensive health related information and
content. Initially, YesRx focused on providing specialized pharmacy care to
select chronic patients within the senior health care market segment.

     Stason Biotech, Inc
     -------------------

     In May of 2000, Kaire entered into a Letter of Intent with Stason USA, Inc,
which outlined a plan to merge Kaire's EZ-Trac Microspheres and Investigator
Partner Service laboratory business with a similar business operated by Stason
into a new entity.

     In January 2001, the Company finalized this agreement and Kaire transferred
the assets of EZ TRAC, Inc. to a new corporation, Stason Biotech, Inc., in
exchange for 40% of the outstanding common stock of the new corporation. This
transaction reflects management's strategic plan to move the Company from
providing medical testing and laboratory analysis to becoming a provider of
prescription medication and supplies to senior citizens and individuals needing
chronic care medications.

     Stason Biotech initially will be engaged in the research and development of
compounds and testing measures for the treatment of pathogenic viral infections
and other medical applications related to solid form prescription drug formation
as well as providing contract research and development services to manufacturers
of pharmaceutical drugs. Stason Biotech is currently undergoing an audit for the
fiscal years 1999 and 2000. It is Stason's and our intent to make Stason Biotech
a publicly reporting entity during calendar year 2001.

                                      -7-
<PAGE>

Subsequent to the audit Kaire expects to finalize a management and consulting
agreement with Stason Biotech whereby Kaire shall act as a business development
consultant for various Stason Biotech projects.

     Classic Care
     ------------

     Kaire acquired Classic Care Pharmacy in May 2000. Formed in 1997, Classic
Care Pharmacy began operations as a provider of specialized pharmacy care for
retired seniors living in extended care facilities in Los Angeles, California.
Since that time, Classic Care has steadily increased the number of facilities
and patients it serves.

     YesRx Health Advocate Program
     -----------------------------

     In November 2000, Kaire introduced the YesRx Health Advocate Program; which
targets the unique pharmacy needs of specific chronic care communities. The
program currently provides specialized pharmacy care to seniors living in
extended care facilities and HIV patients. The program focuses on service.
Health Advocate team members perform a range of services well beyond that of an
average pharmacy. To begin, HIV Health Advocates typically come from the
communities they serve. They process a comprehensive understanding and working
knowledge of the disease and its treatments. They are counselors, they
facilitating communication between patients and their physicians, they help
patients comply with their medication regimes, they manage patient insurance
claims, and more. Many times an individual Health Advocate becomes a valued and
trusted member of a patient's family.

The Health Advocate program is based at Classic Care Pharmacy in Los Angeles.
From that location the program serves HIV patients in Los Angeles and Orange
counties in Southern California.

     NetFame:
     -------

     In July 2000, Kaire acquired the rights to the domain name "NetFame.com."
Kaire purchased the netfame.com domain address with the intention of developing
an interactive online exchange to facilitate communication between the planned
subscriber base consisting of emerging actors, models, and musicians, with
established industry agents. We have completed research and content development
for the site, however, due to current market conditions and the unsuccessful
attempts by potential NetFame competitors, we recently decided to indefinitely
postpone the release of NETFAME.com until such time as market conditions become
more favorable.

Principles of Consolidation
---------------------------

     The consolidated financial statements include the accounts of Kaire and its
wholly owned subsidiaries (collectively the "Company"). The Company's
subsidiaries include See/Shell Biotechnology, Inc., Venus Management, Inc.,
Effective Health, Inc, and Classic Care Pharmacy, Inc. Only Classic Care
Pharmacy, Inc, has current operations; the remaining

                                      -8-
<PAGE>

subsidiaries are dormant. Intercompany accounts and transactions have been
eliminated upon consolidation.

     The Company carries no direct product liability insurance, relying instead
on the coverage afforded by its distributors and the manufacturers from whom it
obtains products. These coverages directly protect the insured that pay the
premiums and only secondarily the Company. There is no assurance that such
coverages will adequately cover any claims that may be brought against the
Company. In addition, the Company does not have any general liability coverage.

2. Summary of Significant Accounting Policies
---------------------------------------------

     Basis of Presentation
     ---------------------

     The financial statements and disclosures included herein for the three
months ended March 31, 2001 and, 2000 are unaudited. These financial statements
and disclosures have been prepared by the Company in accordance with generally
accepted accounting principles for interim financial information. Accordingly,
they do not include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements. In the opinion
of management, all adjustments (consisting of adjustments of a normal and
recurring nature) considered necessary for a fair presentation have been
included. Operating results for the three-month periods ended March 31, 2001 and
2000 are not necessarily indicative of the results that may be expected for the
year ended December 31, 2001

     Income Taxes
     ------------

     The Company utilizes SFAS No. 109, "Accounting for Income Taxes," which
requires the recognition of deferred tax assets and liabilities for the expected
future tax consequences of events that have been included in the financial
statements or tax returns. Under this method, deferred income taxes are
recognized for the tax consequences in future years of differences between the
tax bases of assets and liabilities and their financial reporting amounts at
each period end based on enacted tax laws and statutory tax rates applicable to
the periods in which the differences are expected to affect taxable income.
Valuation allowances are established, when necessary, to reduce deferred tax
assets to the amount expected to be realized. The provision for income taxes
represents the tax payable for the period and the change during the period in
deferred tax assets and liabilities.

     Fair Value of Financial Instruments
     -----------------------------------

     The Company measures its financial assets and liabilities in accordance
with generally accepted accounting principles. For certain of the Company's
financial instruments, including cash and cash equivalents and accounts payable
and accrued liabilities, the carrying amounts approximate fair value due to
their short maturities. The amounts shown for notes payable also approximate
fair value because current interest rates offered to the Company for debt of
similar maturities are substantially the same.

                                      -9-
<PAGE>

               Stock Split
               -----------

               On or about February 19, 1998, the Company had a 1-for-75 reverse
      stock split of its common stock. All share and per share data have been
      retroactively restated to reflect this stock split.

               Stock Options
               -------------

               SFAS No. 123, "Accounting for Stock-Based Compensation,"
      establishes and encourages the use of the fair value based method of
      accounting for stock-based compensation arrangements under which
      compensation cost is determined using the fair value of stock-based
      compensation determined as of the date of grant and is recognized over the
      periods in which the related services are rendered. The statement also
      permits companies to elect to continue using the current implicit value
      accounting method specified in Accounting Principles Bulletin ("APB")
      Opinion No. 25, "Accounting for Stock Issued to Employees," to account for
      stock-based compensation. The Company has elected to use the implicit
      value based method and has disclosed the pro forma effect of using the
      fair value based method to account for its stock-based compensation.

               Income taxes are provided for the tax effects of transactions
      reported in the financial statements and consist of state income taxes
      currently due. No federal income taxes are due as a result of the
      Company's net operating loss carryforwards.

               Net Loss Per Share
               ------------------

               In 1997, the Financial Accounting Standard Board ("FASB") issued
      Statement of Financial Accounting Standards ("SFAS") No. 128, "Earnings
      per Share." SFAS No. 128 replaced the previously reported primary and
      fully diluted earnings per share with basic and diluted earnings per
      share. Unlike primary earnings per share, basic earnings per share
      excludes any dilutive effects of options, warrants, and convertible
      securities. Diluted earnings per share is very similar to the previously
      reported fully diluted earnings per share. Basic earnings per share is
      computed using the weighted-average number of common shares outstanding
      during the period. Common equivalent shares are excluded from the
      computation if their effect is anti-dilutive.

      3.       Convertible Debentures
      -------------------------------

               In January 2001, Kaire issued three convertible notes for
      $500,000, with simple interest accruing at the annual rate of 8%. Interest
      payable on the Notes shall accrue at the annual rate of 8% and be payable
      quarterly commencing April 1, 2001. The Holder shall have the right to
      convert the principal amount and interest due under the notes into Shares
      of the Kaire's common stock. Kaire also issued common stock purchase
      warrants with the right to purchase 1 million shares of Common Stock of
      Kaire Holdings Incorporated.

                                     -10-
<PAGE>

               We anticipate that the $500,000 convertible debentures will be
      converted into shares in accordance with the terms of these debentures.

       4.      Subsequent Equity Transactions
       --------------------------------------

               In May 2001, Kaire issued a convertible note for $400,000, with
      simple interest accruing at the annual rate of 8%. Interest payable on the
      Notes shall accrue at the annual rate of 8% and be payable quarterly
      commencing September 30, 2001. The Holder shall have the right to convert
      the principal amount and interest due under the notes into common shares
      of Kaire. Kaire also issued common stock purchase warrants with the right
      to purchase 1,500,000 shares of our commons stock

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


      Short-term Objectives:

         .  Continue the regional expansion of the Health Advocate Program.
         .  Continue the regional expansion of Classic Care's Business..
         .  Make acquisitions of strategic competitors.
         .  Develop strategic Joint Venture relationships.
         .  Execute a "Contract Management Agreement" with Stason Bio Tech.

         Kaire recently made the decision to eliminate certain YesRx.com
      e-commerce operations to focus more of its resources on its Classic Care
      and Health Advocate operations. The decision was based on a number of
      factors including the poor performance of the online retail pharmacy, the
      general slow growth projections for the next few years, the high cost of
      customer acquisition and retention and the ongoing costs associated with
      maintaining YesRx.com at a competitive level. YesRx.com did expand its
      customer base of retail Internet customers, however, that growth fell far
      below expectations. We anticipate that these actions will reduce operating
      expenses with a nominal impact on revenues. Going forward, YesRx.com will
      serve as a marketing and organizational platform for the Health Advocate
      program.

      Long-term Objectives :

         .  Expand the Health Advocate Program to a national level.
         .  Secure development products and business-opportunities for Stason
            Biotech.

         There is no expected or planned sale of significant equipment by Kaire.

                                     -11-
<PAGE>

         Excluding any potential acquisition, our work force is expected to
      increase at a rate equal to actual increases of our business operations.

         Management is of the opinion that sufficient working capital will be
      available from internal operations and from outside sources during the
      next twelve months thereby enabling Kaire- to meet its obligations and
      commitments as they become payable. Historically, Kaire has been
      successful in its efforts to secure working capital from private
      placements of common stock securities, bank debt, loans from private
      investors and the exercise of common stock warrants.

      Results of Operations

         For the three months ended March 31, 2000 and March 31, 2001
         ------------------------------------------------------------

         The three months ended March 31, 2001, revenue from products and
      services were approximately $3,777,036, an increase $3,715,976 over the
      same period prior year. This increase is primarily due to the revenues
      from our recent acquisition of Classic Care Pharmacy.

         Gross profit for products and services was $661,698 for three months
      ended March 31, 2001, an increase of $631,708 over the same period prior
      year. This increase is directly related to our recent acquisition of
      Classic Care Pharmacy.

      Selling, General and Administrative (SG&A) expense increased to $897,587
      from $235,452, or $662,135 for the three months period ended March 31,
      2001. Of this increase in SG&A, approximately $433,240 was attributable to
      gross wages for Classic Care Pharmacy and Kaire Holdings employees and
      consultants. The remainder of the increase was attributable to accounting,
      advertising, consultants, printing and promotional materials for Classic
      Care Pharmacy and the Health Advocate Program.

         Interest expense for operations for the three months period ended March
      31,2001 was $31,533 compared to $14,544 for the comparable three month
      period prior year. The increase was a result of the new convertible notes
      issued during fourth quarter fiscal year 2000.

         No provision was made for Federal income tax since the Company has
      incurred significant net operating losses from inception. Through March
      31, 2001, the Company incurred net operating losses for tax purposes of
      approximately $507,423. The net operating loss carry forward may be used
      to reduce taxable income through the year 2013. The Company's tax returns
      have not been audited by the Internal Revenue Service. The carry forward
      amounts may therefore be subject to audit and adjustment. As a result of
      the Tax Reform Act, the availability of net operating loss carry forwards
      can be deferred, reduced or eliminated under certain circumstances. Net
      operating losses in the State of California were not available for use
      during 1992 and the carry forward period has generally been reduced from
      fifteen years to five years beginning in 1993.

                                     -12-
<PAGE>

      Liquidity and Capital Resources
      -------------------------------

         The Company's revenues have been insufficient to cover acquisition
      costs, cost of revenues and operating expenses. Therefore, the Company has
      been dependent on private placements of common stock securities, bank
      debt, loans from private investors and the exercise of common stock
      warrants in order to sustain operations. In addition, there can be no
      assurances that private or other capital will continue to be available, or
      that revenues will increase to meet the Company's cash needs, or that a
      sufficient amount of the Company's common stock or other securities can or
      will be sold or that any common stock purchase options/warrants will be
      exercised to fund the operating needs of the Company.

         On March 31, 2001 the Company had assets of $11,964,478 compared to
      $11,635,029 on December 31, 2000. The Company had a total stockholders'
      deficit of $7,025,560 on March 31, 2001 compared to a deficit of
      $7,171,164 on December 31, 2000, a decrease of $145,604.

         As of March 31, 2001 the Company's working capital position increased
      $610,064 from a negative $1,756,472 at December 31, 2000 to a negative
      $1,143,408, primarily as a result of an increase in accounts receivable of
      $827,195 however a increase in accounts payable and miscellaneous accruals
      of $204,343 offset the receivables.

      Going Concern

      The accompanying financial statements have been prepared in conformity
      with generally accepted accounting principles, which contemplate
      continuation of the Company as a going concern. However, the Company has
      experienced net losses of $507,823 and $2,413,175 for the periods ended
      March 31, 2001 and December 31, 2000, respectively. The Company also had
      a net working deficit of $1,756,472 and $1,143,408 for the periods ended
      March 31, 2000 and March 31, 2001, respectively. Additionally, the
      Company must raise additional capital to meet its funding commitments
      for the acquisition of Classic Care, Inc. These factors raise doubt about
      the Company's ability to continue as a going concern. In view of the
      matters described above, recoverability of a major portion of the
      recorded asset amounts shown in the accompanying balance sheet is
      dependent upon the Company's ability to generate sufficient sales volume
      to cover its operating expenses and to raise sufficient capital to meet
      its payment obligations. The financial statements do not include any
      adjustments relating to the recoverability and classification of recorded
      asset amounts, or amounts and classification of liabilities that might be
      necessary should the Company be unable to continue in existence.

                                     -13-
<PAGE>

                          PART II. OTHER INFORMATION


      Item 1.     Legal Proceedings

      Lease Litigation

      In February 1992, Medical Funding of America ("MFA") leased to Tri-County
      a Siemens Mobile Magneton Impact MRI System with a Van. On or about June
      24, 1992, Siemens and MFA entered into a loan and security agreement in
      the amount of $2,019,496, which was paid directly to Siemens Medical
      Systems, Inc. On or about March 1, 1995, Siemens, MFA, Tri-County, and
      Venus Management (an Interactive Medical Technologies (Kaire Holdings)
      subsidiary ("Kaire") entered into a transfer of interest agreement whereby
      Kaire gave its corporate guaranty of all of Venus' obligations under this
      agreement. Venus and MFA defaulted on the loan, and on April 2, 1997,
      Siemens Credit Corporation filed a civil action for the accelerated amount
      due plus costs. This action is still pending. On or about October 9, 1997,
      a Transfer of Interest Agreement was drawn up between Venus Management,
      Siemens Credit Corporation, and Medical Management, Inc. ("CMI," NYSE
      symbol CMI) whereby CMI would take over the lease. CMI took possession of
      the MRI. All parties executed the agreement, except Siemens, who continued
      to negotiate with CMI in an attempt to get CMI to pay all of the
      arrearages owed Siemens. At present CMI and Siemens are still negotiating
      over the terms of the agreement. It is the opinion of the Company's
      management that its obligations under this agreement have been assigned
      and that Siemens will not pursue this matter any further.

      The Company's magnetic resonance imaging ("MRI") system (the "Unit")
      currently is installed in a mobile van at an operating site in Jefferson
      Valley, New York and has been in use since September 1992. It is leased to
      Tri-County Mobile MRI, L.P. ("Tri-County"), whose general partner is
      Diagnostics Resource Funding.

      This lease provides for monthly payments of $37,926 to Venus Management,
      Inc. ("VMI") through August 1999 and $68,589 in September 1999 (with such
      payments being guaranteed by Medical Funding of America, Inc. ("MFA")),
      and VMI is required to make monthly installment payments (which include
      interest at 10.5% per annum on the unpaid principal balance) for the Unit
      to a third party finance company of $32,360 through August 1999 and
      $68,589 in September 1999. This lease provides for a purchase option at
      the expiration of the initial term of such lease equal to the then fair
      market value of the Unit.

      Tri-County was delinquent in making certain of its lease payments to VMI
      under the terms of the lease agreement concerning the Unit, and MFA failed
      to make these payments to VMI under its guarantee of Tri-County's payments
      to VMI. Accordingly, VMI had not made certain payments due to the
      third-party finance company for the Unit.

      As a result, the third-party finance company issued a notice of default to
      the Company. Tri-County is currently in discussions with the third-party
      finance company to restructure the obligation, to assume the debt, and to
      take title to the Unit. It is expected that the third-party

                                     -14-
<PAGE>

      finance company will accept the restructure, and the Company will release
      its title to the equipment in exchange for the third-party finance company
      releasing the Company from its debt obligation. However, if the parties
      are unable to resolve this matter, it is likely that the third-party
      finance company will institute an action against the Company, VMI, and
      Tri-County for the balance due, plus other costs and relief.

      Patent Claim

      An individual filed a complaint against the Company alleging breach of
      contract and fraud and related business torts related to certain patents
      that the plaintiff transferred to the Company. The Company believes that
      the plaintiff's claims are without merit and intends to vigorously defend
      itself. The amount of claimed damages is not yet determined.

      Except as otherwise specifically indicated above, management believes that
      the Company doesn't have any material liability for any lawsuits,
      settlements, judgments, or fees of defense counsel which have not been
      paid or accrued as of December 31, 2001. However, there can be no
      assurance that the Company will prevail in any of the above proceedings.
      In addition, the Company may be required to continue to defend itself
      resulting in substantial additional expense. In the event the Company is
      unable to pay the defense costs associated with the foregoing, an
      unfavorable settlement or judgment could be awarded against the Company,
      which could have a material adverse effect upon the Company.

      Item 2.  Changes in Securities and Use of Proceeds

            During the Quarter ending March 31, 2001, the Company issued
      securities using the exceptions available under the Securities Act of 1933
      including unregistered sales made pursuant to Section 4(2) of the
      Securities Act of 1933, as follows:

            In January 2001, the Company issued 3,000,000 shares of common stock
      for options exercised valued at $150,000. These options were issued to
      Kaire's management.

           In February 2001 the Company issued 6,000,000 shares of common stock
      for professional services valued at $240,000.

      Item 3.  Defaults Upon Senior Securities

      None

      Item 4.  Submission of Matters of a Vote to Security Holders

           On or about October 1, 1997, a proposal to increase the number of
      authorized shares to 400,000,000 for the purpose to provide for the merger
      with Kaire International, Inc. was voted upon and authorized by a majority
      of Kaire Holdings, Inc. shareholders.

           On or about January 30, 1998, a proposal to 1) reverse split the
      Company's common stock up to and not to exceed a reverse ratio of
      seventy-five to one, 2) amend the

                                     -15-
<PAGE>

      Company's Articles of Incorporation changing the Company name to Kaire
      Holdings Incorporated and 3) changing the Company's NASDAQ symbol to KHI
      was voted and authorized by a majority of Kaire Holdings, Inc.
      shareholders. These changes became effective on February 19, 1998.

      Item 5.  Other Information

      None

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

      None

                                     -16-
<PAGE>

                                  SIGNATURES
                                  ----------

               Pursuant to the requirements of Section 13 or 15(d) of the
      Securities Exchange Act of 1934, the Registrant has duly caused this
      report to be signed on its behalf by the undersigned, thereunto duly
      authorized.

                        KAIRE HOLDINGS INCORPORATED.
                        ----------------------------
                            (Registrant)



      Date:  May 21,  2001               By: /s/ STEVEN  R.WESTLUND
                                             ----------------------
                                             Steven Westlund
                                             Chief Executive Officer, Chairman

      Date:  May 21, 2001                By:  /s/ OWEN M. NACCARATO
                                              ---------------------
                                              Owen M. Naccarato
                                              Chief Financial Officer, director

      Date:  May 21, 2001                By:  /s/ ASHER GOTTESMAN
                                              -------------------
                                              Asher Gottesman
                                              Director

                                     -17-