UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) March 26, 2007
Revolutions Medical Corporation
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(Exact name of registrant as specified in its charter)
Nevada 000-28629 73-1526138
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(State or other jurisdiction (Commission File Number) IRS Employer
of incorporation) Identification No.)
2073 Shell Ring Circle, Mt. Pleasant, South Carolina 29466
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (843) 971-4848
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_________________
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
ITEM 2.01 COMPLETION OF ACQUISITION OR DISPOSITION OF ASSETS.
On March 26, 2007, the Company completed the acquisition of the sole asset of
Clear Image Acquisition Corporation ("Acquisition Corp.") pursuant to the Plan
and Agreement of Reorganization of January 26, 2007 (See Form 8-K filed January
30, 2007).
The acquisition was originally scheduled to have closed on January 31, 2007.
However, a relatively large number of the shareholders of Clear Image, Inc. who
were participants in the Reorganization had to file Lost Certificate Affidavits.
As a result, the Closing was delayed to permit those participants to submit the
affidavits and obtain replacement stock certificates. As of March 26, 2007, some
participants had not yet submitted the Lost Certificate Affidavits, but
Acquisition Corp. had obtained a total of 9,638,339 shares of Clear Image, Inc.
which equated to 62.2% of the Common Stock of the corporation. So as to close
the Reorganization, the number of shares issued by the Company for the 9,638,339
shares of Clear Image, Inc. was reduced to 8,273,788 shares. Otherwise, the
Closing was as provided in the reported Plan and Agreement and the Company
assumed the limited liabilities of Acquisition Corp. which are only the costs of
Acqusition Corp.'s dissolution and liquidation.
The assets acquired consisted solely of a block of the Common Stock of Clear
Image, Inc. The block consisted of 9,638,339 shares, or approximately 185,800
shares less than anticipated due to the failure of some persons to file Lost
Certificate Affidavits, but was sufficient to represent a controlling interest
in that company (62.2%). The shares were acquired by Acquisition Corp. from a
number of shareholders of Clear Image, Inc. who had contributed their shares of
Clear Image, Inc. to Acquisition Corp. in order to assemble a block sufficient
to attract the Company to make the acquisition. The Company and Clear Image,
Inc. may be considered as "affiliates" since they are under common control of
Rondald Wheet, Thomas J. O'Brien and Dr. Thomas M. Beahm. (In addition, Mr.
Wheet and the Company's counsel served as the officers and directors of
Acquisition Corp. for purposes of effecting the Plan.) Also, the three directors
of the Company, Messrs. Wheet, O'Brien and Beahm, were shareholders of Clear
Image, Inc. who participated in the Reorganization. Rondald Wheet had 2,286,000
shares, Thomas O'Brien had 1,645,625 shares, and Dr. Thomas Beahm had 1,599,125
shares. In determining the ratio of the shares to be exchanged by the Company
for the shares of Clear Image, Inc. they based the transaction value on the
funds expended by Clear Image for the technology in its current state, using a
value of Forty Cents ($.40) per share for the Company's Common Stock which was
the then market value.
Clear Image, Inc. was organized as an Oklahoma corporation under the name "Image
Analysis, Inc." on October 6, 1998. On May 15, 2003 it changed its name to Clear
Image, Inc.
Since its formation, Clear Image's principal business has been to develop and
commercialize color MRI technology - "MRI" referring to "Magnetic Resonance
Imaging" equipment. Magnetic Resonance Imaging is a widely used imaging system
that safely creates many different and detailed views of selected portions of
the internal anatomy. A MRI scanner is a large tunnel- shaped machine that will
accommodate an adult lying down. Within the MRI scanner is a large magnet which
directs harmless radio signals around sections of the body. When these signals
pass through the body, they resonate; that is, release a signal. The released
signals are picked up by a receiver inside the MRI scanner and then sent to a
computer. The computer analyzes the signals and converts them to a visual image
that is displayed on a viewing monitor and then printed on special film. The
images produced by the scanner are gray-scale images similar to an x-ray. These
gray-scale images can be difficult and time consuming to "read". A radiologist
"reads" these images on film by comparing the different scans of each tissue
slice, sometimes evaluating one hundred to three hundred individual gray images
to obtain a diagnosis. The successful diagnosis of a condition, using MRI,
depends not only on the ability of the radiologist to detect the subtle
differences in shades of gray, but also the radiologist's ability to compare
visually the vast number of images.
The transaction is intended to qualify as a so-called "C" Reorganization under
Section 368(a)(1)(C) of the Internal Revenue Code. Accordingly, Acquisition
Corp. will shortly be dissolved.
Risks of Clear Image, Inc.
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o Although Clear Image was organized in October, 1998 and has been in
existence for approximately eight years, it has a limited operating
history and remains a development stage company.
o Clear Image has suffered due to under-capitalization and lack of
working capital and its auditors have stated in their opinions that,
since the corporation is a development stage company with insufficient
revenues to fund development and operating expenses, there is
"substantial doubt about its ability to continue as a going concern".
o Clear Image has had annual losses since its inception and will continue
to incur losses until it completes product development, of which there
is no assurance.
o Clear Image acquired an exclusive license relating to the color MRI
technology from the University of South Florida Research Foundation
("USFRF"). The license required that the licensee use its "best
efforts" to develop the technology, although that term is undefined. On
August 1, 2002 USFRF notified Clear Image that the license was
terminated because Clear Image had not used its "best efforts". Clear
Image disputes that and believes that USFRF cannot terminate the
license. The dispute is unresolved; Clear Image has withheld the
royalty payments due, although they have been accrued as liabilities.
At this point in time, Clear Image believes that its products do not
rely on the license; however, the legal implications are uncertain and
termination of the license could materially adversely affect the
business and revenues of Clear Image.
o Other companies are working on similar technologies. How such
technologies, if completed, will compare to the Company's, what the
comparative pricing and terms of use will be, and what the relative
market acceptances will be, is uncertain.
o It is highly probable that Clear Image will need to enter into one or
more joint ventures or similar arrangement with a company in the MRI
field which can offer both financial and marketing support. Whether
such an arrangement can be developed is uncertain.
o It is most likely that Clear Image will need to enter into licensing
arrangements, for sub- portions of its technology as those are ready
for commercialization, but whether such licenses will be taken, and the
terms of them, are uncertainties.
Business of Clear Image, Inc.
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As noted above, Clear Image, Inc. ("Clear Image") is engaged in the development
of technology which can segmentate and reference MRI images. By "segmenting" an
image, the Company's technology will let the user select a part of the image
(bone, fluid, tissue) and render that selection in 3 dimensions. Essentially,
different components of an image are given different colors and the user can
choose the color or colors to be studied, thus eliminating those portions
colored with the colors being discarded. By "referencing" the image to a data
base, the user can obtain similar, identified images to aid the user in
interpretation of the image being studied. Although the current stage of the
Company's technology uses color MRI technology, the Company believes that it is
sufficiently separate from the technology licensed to it by USFRS to permit it
to proceed regardless of the status of the license from USFRS (see "Risk
Factors" above).
Property of Clear Image, Inc.
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Clear Image has a license; the one discussed above issued by USFRS. In addition,
Clear Image owns four (4) separate patent applications, filed June 15, 2006
which were assigned over by Clear Image's consultant, Richard Theriault
Management of Clear Image, Inc.
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Clear Image, Inc.'s President is Thomas O'Brien, who is also a director of the
Company. Mr. O'Brien, age 60, has more than twenty years of general management
experience in the medical device field. He has special expertise in domestic and
international sales, marketing and distribution of high technology medical
systems and services, having held executive positions with companies such as
Pfizer, Toshiba and Johnson&Johnson-owned Technicare Corporation. Mr. O'Brien
also serves as a director of Clear Image.
Rondald Wheet, President and a director of the Company, age 41, is
Vice-President and Secretary of Clear Image and serves as a director..
ITEM 3.02 UNREGISTERED SALES OF EQUITY SECURITIES
On March 26, 2007, to acquire the assets of Clear Image Acquisition Corporation,
the Company issued 8,273,788 shares of its Common Stock.. These securities were
issued in a private placement, pursuant to Section 4(2) of the Securities Act,
all of such participants being "accredited investors".
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS
Financial Statements to be filed by amendment
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
REVOLUTIONS MEDICAL CORPORATION
By: /s/ Rondald Wheet
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Dated: March 28, 2007