UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended March 31, 2009
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: 0-28629
-------
REVOLUTIONS MEDICAL CORPORATION
(Name of Small Business Issuer in its charter)
NEVADA 73-1526138
------------------------------- ---------------------------
(State or other jurisdiction of (IRS Employer I.D. No.)
incorporation or organization)
2073 SHELL RING CIRCLE
MT. PLEASANT, SC 29466
(Address of principal executive offices and Zip Code)
(843) 971-4848
(Registrant's telephone number, including area code)
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 past 12 months, and (2) has been subject to such
filing requirements for the past 90 days.
Yes [X] No [ ]
Indicate by check mark whether the registrant is a large accelerated filer,
an accelerated filer, or a non-accelerated filer, or a smaller reporting
company. See the definitions of "large accelerated filer," "accelerated filer"
and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer [ ] Accelerated filer [ ]
Non-accelerated filer [ ] Smaller reporting company [X]
(Do not check if a smaller reporting company)
Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act).
Yes [ ] No [X]
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:
There were 30,431,813 shares of common stock, $0.001 par value, outstanding and
1,000,000 shares of Series 2007 preferred stock, $0.001 par value outstanding as
of April 15, 2009.
TABLE OF CONTENTS
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
Consolidated Balance Sheet at March 31, 2009 (Unaudited) 3
Consolidated Statements of Operations For The Period From Inception
(August 16, 1996) to March 31, 2009 and For The Three Months Ended
March 31, 2009 and 2008 (Unaudited) 4
Consolidated Statements of Cash Flows For The Period From Inception
(August 16, 1996) to March 31, 2009 and For The Three months Ended
March 31, 2009 and 2008 (Unaudited) 5
Notes to Consolidated Financial Statements (Unaudited) 7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS 13
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 16
ITEM 4T. CONTROLS AND PROCEDURES 23
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS 24
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS 24
ITEM 6. EXHIBITS 24
2
REVOLUTIONS MEDICAL CORPORATION
(A Development Stage Company)
BALANCE SHEET
March 31, 2009
(Unaudited)
ASSETS
3/31/09 12/31/08
------------------------------
CURRENT ASSETS
Cash $ 44,988 $ 4,796
Other assets 4,395 --
Goodwill 23,276 23,276
------------------------------
TOTAL ASSETS $ 72,659 $ 28,072
==============================
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable and accrued liabilities $ 228,785 $ 466,683
Accrued Salaries 709,449 1,158,103
Notes Payable and Accrued Interest 143,429 143,429
------------------------------
Total current liabilities 1,081,663 1,768,215
------------------------------
Total liabilities 1,081,663 1,768,215
------------------------------
SHAREHOLDERS' DEFICIENCY
Preferred stock, $0.001 par value,
5,000,000 shares authorized; 1,000,000 shares issued and outstanding 1,000 1,000
Common stock, $0.001 par value,
250,000,000 shares authorized; 30,081,813 and 26,883,195 30,082 26,883
shares issued and outstanding at 3/31/09 and 12/31/08, respectively
Paid in capital 19,800,309 18,769,691
Deficit accumulated during the development stage (20,840,395) (20,537,717)
------------------------------
Total shareholders' deficiency (1,009,004) (1,740,143)
------------------------------
TOTAL LIABILITIES AND SHAREHOLDERS' DEFICIENCY $ 72,659 $ 28,072
==============================
The accompanying notes are an integral part of the interim financial statements
3
REVOLUTIONS MEDICAL CORPORATION
(A Development Stage Company)
STATEMENTS OF OPERATIONS
From Inception (August 16, 1996) Through March 31, 2009 and
For The Three Months Ended March 31, 2009 and 2008
(Unaudited)
FROM INCEPTION
(AUGUST 16,
1996) THROUGH THREE MONTHS ENDED THREE MONTHS ENDED
MAR 31, 2009 MAR 31, 2009 MAR 31, 2008
------------------------------------------------
Investment Income $ 170,753 $ -- $ --
Other Income 596,554 592,697 --
-------------------------------------------------
767,307 592,697 --
------------------------------------ ------------
EXPENSES
Research and development 2,379,056 96,000 8,000
Purchased R&D 3,309,515 -- --
General and administrative 14,913,257 345,493 132,856
------------------------------------------------
Total operating expenses 20,601,828 441,493 140,856
------------------------------------------------
Operating income (loss) (19,834,521) 151,204 (140,856)
------------------------------------------------
Interest income 17,276 -- --
------------------------------------------------
Interest expense 122,297 -- --
------------------------------------------------
Gain on disposal of assets 794 -- --
------------------------------------------------
Gain on extinguishment of debt 10,398 -- --
------------------------------------------------
Depreciation and amortization 75,536 -- --
------------------------------------------------
Compensation cost for options 1,019,931 453,882 --
-------------------------------------------------
Net loss before minority interest (21,023,817) (302,678) (140,856)
------------------------------------------------
Minority Interest in Subsidiary Loss (183,422) -- (17,120)
------------------------------------------------
Net loss from operations $(20,840,395) $ (302,678) $ (123,736)
================================================
Weighted average shares
outstanding 38,253,426 28,035,224 18,362,324
------------------------------------------------
Net loss per share (Note 1) $ (0.54) $ (0.01) $ (0.01)
================================================
The accompanying notes are an integral part of the interim financial statements
4
REVOLUTIONS MEDICAL CORPORATION
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
From Inception (August 16, 1996) Through March 31, 2009 and
For The Three Months Ended March 31, 2009 and 2008
(Unaudited)
FROM INCEPTION
(AUGUST 16,
1996) THROUGH THREE MONTHS ENDED
MARCH 31, MARCH 31, MARCH 31,
2009 2009 2008
------------------------------------------------------
OPERATING ACTIVITIES
Loss from operations before minority interest $(20,840,395) $ (302,678) $ (123,736)
Plus non-cash charges to earnings
Stock compensation expense 1,019,931 453,882 --
Depreciation and amortization 75,525 -- --
Purchase R&D - Clear Image 3,309,515 -- --
Common stock issued for services 3,846,628 229,300 390,000
Preferred stock issued for services 20,000 -- --
Expenses paid by third parties 57,134 -- --
Contribution of services by officer and employees 799,154 -- --
Services by officer and employees paid for
with non-cash consideration 167,500 -- --
Compensation cost for option price reduction 50,000 -- --
Amortization of compensation cost for options
granted to non-employees and common stock
issued for services 1,775,577 -- --
Allowance for doubtful accounts 50,900 -- --
Gain on extinguishment of debt (10,398) -- --
Write-off of Notes Receivable 14,636 -- --
Write-off of Notes Payable (8,239) -- (8,239)
Write-off of organizational costs 3,196 -- --
Write-off of zero value investments 785,418 -- --
Write-off of leasehold improvements and computer equipment 2,006 -- --
Compensation costs for stock options and warrants
granted to non-employees 1,205,015 -- --
Change in working capital accounts:
(Increase) decrease in receivables from related parties (68,900) -- --
Increase in other assets (4,395) (4,395) --
(Increase) decrease in goodwill (23,276) -- --
(Increase) decrease in other receivables (176,577) -- --
Increase (decrease) in accrued salaries and consulting 484,397 (448,654) 49,000
Increase (decrease) in accrued interest 91,177 -- --
Increase (decrease) in accounts payable and accrued liabilities 1,320,331 (237,898) 251
------------------------------------------------------
Total operating activities (6,054,140) (310,443) (82,724)
------------------------------------------------------
INVESTING ACTIVITIES
Purchase of equipment (67,042) -- --
Investment in syringe patent development (10,000) -- --
Investment in Ives Health Company (251,997) -- --
Investment in The Health Club (10,000) -- --
------------------------------------------------------
Total investing activities (339,039) -- --
------------------------------------------------------
FINANCING ACTIVITIES
Loans from shareholders 13,907 -- --
Repayment of loans from shareholders (8,005) -- --
Repayments of Promissory Notes 190,754 -- --
Common stock subscribed 34,000 -- --
Sale of preferred stock for cash: (1,000) -- --
Sale of common stock for cash:
To third-party investors (prior to merger) 574,477 -- --
To third-party investors 4,016,001 10,134 100,000
From exercise of stock options 1,662,918 340,501 --
Less: Issue Costs (102,318) -- --
Convertible debentures issued for cash 355,000 -- --
Payment of exclusive license note payable (100,000) -- --
------------------------------------------------------
Total financing activities 6,635,734 350,635 100,000
------------------------------------------------------
Minority interest (197,567) -- (17,120)
------------------------------------------------------
Change in cash 44,988 40,192 156
Cash at beginning of period -- 4,796 2,398
------------------------------------------------------
Cash at end of period $ 44,988 $ 44,988 $ 2,554
======================================================
Continued
5
REVOLUTIONS MEDICAL CORPORATION
(A Development Stage Company)
STATEMENTS OF CASH FLOWS, Continued
From Inception (August 16, 1996) Through March 31, 2009 and
For The Three Months Ended March 31, 2009 and 2008
(Unaudited)
FROM INCEPTION
(AUGUST 16,
1996) THROUGH THREE MONTHS ENDED
MARCH 31, MARCH 31, MARCH 31,
2009 2009 2008
------------------------------------------------------
Supplemental disclosure of cash flow information:
Cash paid for interest and taxes during the period 57,571 -- --
------------------------------------------------------
Non-cash financing and investing activities:
Acquisition of Color MRI Technology 3,309,515 -- --
Investment in Globe Joint Venture (637,566) -- --
Common stock issued to founders 7,000 -- --
Common stock issued in connection with merger
with Cerro Mining Corporation 300 -- --
20 to 1 reverse stock split 138,188 -- --
Common stock issued in Ives merger 346,262 -- --
Common stock subscriptions 69,800 -- --
Capitalized compensation cost for options granted 1,487,700 -- --
Common stock issued in exchange for promissory note 676,500 -- --
Common stock issued for payment of debt 152,553 -- --
Common stock issued for convertible debentures 190,660 -- --
Common stock issued for services 706,663 -- --
Common stock issued to pay Ives debt 27,000 -- --
Common stock issued to Clear Image shareholders under short form merger 12,208 -- --
6
REVOLUTIONS MEDICAL CORPORATION AND SUBSIDIARY
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2009
(UNAUDITED)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
- ---------------------
The accompanying interim consolidated financial statements of
Revolutions Medical Corporation ("RevMed") and its partially-owned subsidiary
Clear Image, Inc. ("Clear Image"), together referred to as the "Company" are
unaudited; however, in the opinion of management, the interim consolidated
financial statements reflect all adjustments, consisting only of normal
recurring adjustments, necessary for a fair presentation of the results for the
interim periods. All intercompany balances and transactions have been eliminated
in consolidation. The results of operations for the three months ended March
31, 2009 are not necessarily indicative of the results to be expected for the
year ending December 31, 2009. These consolidated financial statements should be
read in conjunction with the consolidated financial statements and notes for the
year ended December 31, 2008 appearing in the Company's Annual Report on Form
10-K for the year ended December 31, 2008, as filed with the Securities and
Exchange Commission.
Organization and Nature of Operations
- -------------------------------------
Revolutions Medical Corporation, a Nevada corporation, ("RevMed" or
"the Company") is principally engaged in the design and development of
retractable safety needle devices intended to reduce the risk of accidental
needle stick injuries among health care workers. During 2008, RevMed acquired
100% of the common stock of Clear Image, Inc., which was developing a color MRI
technology. The Company now owns this technology as well. The Company has no
products for sale at this time.
Development Stage Company
- -------------------------
Since its inception in 1996, the Company has been considered a
development stage enterprise for financial reporting purposes as significant
efforts have been devoted to raising capital and to research and development of
various safety needle devices.
Cash and Cash Equivalents
- -------------------------
The Company considers highly liquid investments (those readily
convertible to cash) purchased with original maturity dates of three months or
less to be cash equivalents.
Stock-based Compensation
- ------------------------
The Company has adopted Statement of Financial Accounting Standards
("SFAS") No. 123 (revised 2004), "Share-Based Payment" ("SFAS 123R"). SFAS 123R
requires the recognition of the cost of employee services received in exchange
for an award of equity instruments in the financial statements and is measured
based on the grant date fair value of the award. SFAS 123R also requires the
stock option compensation expense to be recognized over the period during which
an employee is required to provide service in exchange for the award (the
vesting period).
Income Taxes
- ------------
The Company uses the liability method of accounting for income taxes as
set forth in Statement of Financial Accounting Standards No. 109, "Accounting
for Income Taxes." Under the liability method, deferred taxes are determined
based on the differences between the financial statement and tax basis of assets
and liabilities at enacted tax rates in effect in the years in which the
differences are expected to reverse.
7
Segment Information
- -------------------
Effective January 1, 1998, the Company adopted the provisions of SFAS
No. 131, "Disclosures about Segments of an Enterprise and Related Information".
The Company identifies its operating segments based on business activities,
management responsibility and geographical location. During the period covered
by these financial statements, the Company operated in a single business
segment engaged in developing selected healthcare products.
Loss per Share
- --------------
The Company computes net loss per share in accordance with SFAS No.
128, "Earnings per Share" and SEC Staff Accounting Bulletin No. 98 ("SAB 98").
Under the provision of SFAS No. 128 and SAB 98 basic net loss per share is
calculated by dividing net loss available to common stockholders for the period
by the weighted average shares of common stock of the Company outstanding during
the period. Diluted net loss per share is computed by dividing the net loss for
the period by the weighted average number of common and common equivalent shares
outstanding during the period. The calculation of fully diluted loss per share
of common stock assumes the dilutive effect of stock options outstanding. During
a loss period, the assumed exercise of outstanding stock options has an
anti-dilutive effect. Therefore, the outstanding stock options were not included
in the March 31, 2009 and 2008 calculations of loss per share.
Use of Estimates
- ----------------
The preparation of financial statements in conformity with accounting
principals generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported revenues and expenses
during the reporting period. Actual results could differ significantly from
those estimates.
Reclassifications
- -----------------
Certain reclassifications may have been made to the prior year
financial statements to conform to the current period presentation.
Long-Lived Assets
- ------------------
Property, plant and equipment, including significant improvements, are
stated at cost. Expenditures for maintenance and repairs are charged to
operating expenses as incurred. When properties are retired or otherwise
disposed of, the cost of the asset and the related accumulated depreciation are
removed from the accounts with the resulting gain or loss being reflected in
results of operations.
Management assesses the recoverability of property and equipment,
goodwill, trademarks and other intangible assets whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be
recoverable from its future undiscounted cash flows. If it is determined
impairment has occurred, an impairment loss is recognized for the amount by
which the carrying amount of the asset exceeds its estimated fair value.
New Accounting Standards
- ------------------------
The Financial Accounting Standards Board ("FASB") periodically issues
new accounting standards in a continuing effort to improve standards of
financial accounting and reporting. Management has reviewed the recently issued
pronouncements and concluded that the following new accounting standards are
potentially applicable to the Company.
8
In April 2009, the FASB issued Staff Position No. 141(R)-1, "Accounting
for Assets Acquired and Liabilities Assumed in a Business Combination that Arise
from Contingencies." The Staff Position amends SFAS No. 141(R), "Business
Combinations" to require an acquirer to recognize at fair value at acquisition
date an asset acquired or liability assumed in a business combination that
arises from a contingency if the acquisition date fair value of that asset or
liability can be determined during the measurement period. The Staff Position is
effective for business combinations with an acquisition date on or after
December 15, 2008. The adoption of this standard did not have a material impact
on the Company's financial position, results of operations or cash flows.
In April 2009, the FASB issued Staff Position No. 157-4, "Determining
Fair Value when the Volume and Level of Activity for the Asset or Liability Have
Significantly Decreased and Indentifying Transactions that are not Orderly." The
Staff Position provides guidance for making fair value measurements more
consistent with the principles presented in SFAS No. 157, "Fair Value
Measurements." The Staff Position relates to determining fair values when there
is no active market or where the inputs being used represent distressed sales.
The Staff Position is effective for interim and annual periods ending after June
15, 2009, but entities may early adopt the Staff Position for the interim and
annual periods ending after March 15, 2009. The Company does not expect the
adoption of this standard to have a material impact on its financial position,
results of operations or its cash flows.
In April 2009, the FASB issued Staff Position No. 107-1 and APB 28-1,
"Interim Disclosures about Fair Value of Financial Instruments." The purpose of
this Staff Position is to enhance consistency in financial reporting by
increasing the frequency of fair value disclosures. The Staff Position relates
to assets and liabilities that are not currently disclosed on the statement of
financial position at fair value. These financial instruments are currently
disclosed at fair value in the notes to the financial statements on an annual
basis only. This Staff Position provides for these fair value footnote
disclosures to be made at interim periods, also. The Staff Position is effective
for interim and annual periods ending after June 15, 2009, but entities may
early adopt the Staff Position for the interim and annual periods ending after
March 15, 2009. The Company does not expect the adoption of this standard to
have a material impact on its financial position, results of operations or its
cash flows .
In April 2009, the FASB issued Staff Position No. 115-2 and 124-2,
"Recognition and Presentation of Other-Than-Temporary Impairment." The purpose
of this Staff Position is to bring greater consistency to the timing of
impairment recognition and greater clarity regarding disclosures to investors
regarding the cash flows, credit losses and aging of securities with unrealized
losses. The Staff Position is effective for interim and annual periods ending
after June 15, 2009, but entities may early adopt the Staff Position for the
interim and annual periods ending after March 15, 2009. The Company does not
expect the adoption of this standard to have a material impact on its financial
position, results of operations or its cash flows.
Other accounting standards that have been issued or proposed by the
FASB or other standards-setting bodies are not expected to have a material
impact on the Company's financial position, results of operations or cash flows.
NOTE 2 - UNCERTAINTIES
The accompanying financial statements have been prepared assuming the
Company will continue as a going concern. The Company is in the development
stage and has not established sources of revenues to fund the development of
business and pay operating expenses, resulting in a cumulative net loss
of$(20,840,395) for the period from inception (August 16, 1996) to March
31, 2009. The ability of the Company to continue as a going concern during the
next year depends on the successful completion of the Company's capital raising
efforts to fund the development of its retractable safety syringe and its color
MRI technology. The financial statements do not include any adjustments that
might be necessary if the Company is unable to continue as a going concern.
9
NOTE 3 - MAXXON/GLOBE JOINT VENTURE AGREEMENT
On November 3, 2005, Maxxon and Globe Med Tech, Inc. entered into a
definitive joint venture agreement to patent, develop, manufacture, market and
distribute safety needle products throughout the world. Maxxon and Globe each
own 50% of the joint venture. Maxxon contributed its safety syringe technology
and patent rights related thereto and Globe contributed its safety syringe IV
catheter and patent rights related thereto. In connection with the agreement,
Maxxon issued restricted shares of its common stock, valued at $625,066, to
Globe. Subsequent to December 31, 2006, the Company ended the joint venture and
cancelled the shares of common stock and options that were issued to Globe
pursuant to the agreement. On March 1, 2007, the Company filed a lawsuit in the
District Court of Tulsa County, Oklahoma against Globe Med Tech, Inc. to
rescind, terminate and seek monetary damages for the non-fulfillment and breach
of a joint venture agreement entered into November 3, 2005 and other related
agreements, in addition to an accounting of expenditures of funds under the
terms and provisions of the agreements. On May 11, 2007, a partial default
judgment against Globe was granted by the District Court of Harris County,
Texas. The partial default judgment as to liability only was granted with
respect to the Company's causes of action against Globe for breach of contract,
conversion and common law fraud with respect to the Company's Original Petition
and Application for Temporary and Permanent Injunctions against Globe on January
30, 2007. On August 13, 2007, the Company was granted a final default judgment
for permanent injunctive relief and for damages in the amount of $14,029,000
against Globe. Globe has appealed the judgment. On November 23, 2007, the Court
signed an order granting Globe's Motion for New Trial and setting aside the
Final Default Judgment entered in favor of the Company on August 13, 2007.
On October 29, 2008, the Company filed a lawsuit in the district court
of Harris county Texas, a lawsuit for fraud and contempt of court for Globe Med
Tech and Andy Hu individually. In response, Globe filed a motion to stay the
lawsuit based upon the forum selection clause in the joint venture agreement
between RMC and Globe which provides that the exclusive forum for all disputes
relating to the Joint Venture Agreement shall be Oklahoma state court/Tulsa
County. Due to the Texas state district's court's backlog of cases and the
withdrawal of Globe and Andy Hu's counsel, the motion to stay was not heard
until May 1, 2009. The motion was granted as to Globe; however, Hu did not join
in the motion and, after the May 1st hearing, filed a separate motion to stay,
based upon the same grounds as Globe's motion. Hu's motion to stay was denied at
a May 8th hearing. Accordingly, the Company intends to proceed post haste with
discovery with respect to its claims against Hu, including without limitation
obtaining the deposition of a key witness.
NOTE 4 - OTHER COMMITMENTS AND CONTINGENCIES
Employment Agreement with Rondald Wheet, CEO
- --------------------------------------------
Effective March 31, 2008, the Company and Mr. Wheet, our CEO, entered
into a three year employment agreement. The agreement provides for an annual
salary of $225,000.As of March 31, 2009, the Company owed Mr. Wheet $55,724
pursuant to his prior employment agreement. He is responsible for the Company's
substantive and financial reporting requirements of the Securities Exchange Act
of 1934, as amended, and is specifically allowed to hire any and all
professionals necessary to assist that process. The Company will provide him
with all reasonable and customary fringe benefits, including, but not limited
to, participation in pension plans, profit sharing plans, employee stock
ownership plans, stock option plans (whether statutory or not), stock
appreciation rights plans, hospitalization, medical dental disability and life
insurance, car allowance, vacation and sick leave. The Company will reimburse
all of his reasonable and necessary travel, entertainment or other related
expenses incurred by him in carrying out his duties and responsibilities under
the agreement. The Company will also provide him with a cell phone, suitable
office space, and membership dues in professional organizations and for any
seminars and conferences related to Company business.
Mr. Wheet may elect, by written notice to the Company, to terminate his
employment with continued pay through the employment agreement term if (i) the
Company sells all of its assets, (ii) the Company merges with another business
entity with a change in control, (iii) more than 50% of the outstanding stock is
acquired by a third party, (iv) the Company requires Mr. Wheet to relocate or
assigns duties not commensurate with his position as CEO, (v) Mr. Wheet is
removed from the Board of Directors and (vi) the Company defaults in making
payments required to Mr. Wheet under this agreement. For two years following his
resignation or termination, Mr. Wheet will not work for or provide any services
in any capacity to any competitor and will not solicit any of the Company's
customers or accounts.
10
Mutual Release and Settlement Agreement With Former CEO
- -------------------------------------------------------
On April 14, 2006, the Company and its former CEO entered into a mutual
release and settlement agreement, pursuant to which the Company issued to the
former CEO a promissory note for $203,920 (amount outstanding at December 31,
2007) and a warrant to purchase up to 12,913,239 shares of common stock at
$0.001 per share on or before April 14, 2010. In addition, the mutual release
and settlement provides for continued indemnification of the former CEO and
mutual releases. The note, which is unsecured and is presently in default, bears
interest at 18% per year as the note was due April 14, 2007. As of December 31,
2007, the Company had accrued interest payable of $91,176. The warrant is
exercisable only to the extent that the number of shares of common stock
exercised plus the number of shares presently owned by the warrant holder does
not exceed 4.99% of the outstanding shares of Common Stock of the Company on
such date. The exercise limit is revocable by the warrant holder upon 75 days
prior notice to the Company. During the three months ended March 31, 2006, the
former CEO exercised warrants to purchase 6,000,000 shares of common stock. The
exercise price of $6,000 was paid by reducing the principal balance of the
promissory note by $6,000. During 2007, the Company issued 345,662 shares of
common stock upon the exercise of a warrant. The exercise price of $6,913 was
paid by reducing the principal balance of the promissory note payable by the
Company.
On April 8, 2008, the Company entered into a Memorandum of
Understanding with its former CEO to settle this outstanding obligation through
the issuance of its common stock on a quarterly basis commencing May 8, 2008 for
one year. The value of the issuance of the common stock will be determined by
the market value of the ten day average price following May 8, 2008 through May
18, 2008. During 2008, the Company issued 271,491 shares at a total value of
$133,030 to partially repay this debt. On May 6, 2009, the Company issued
666,828 shares with a value of $306,741 to completely pay off this debt.
Amounts Due Pursuant to Employment and Consulting Agreements
- ------------------------------------------------------------
The Company has accrued $709,449 pursuant to employment and consulting
agreements which are in default. Although the Company plans to settle these
amounts, there is no assurance that its efforts to settle will be successful. No
litigation related to these agreements has been initiated or threatened. There
is no assurance, however, that such litigation will not be initiated in the
future.
Patent Applications for the Company's RevVac Safety Syringe
- -----------------------------------------------------------
The Company owns a patent published January 2005 and a patent
application was filed by the Globe/RevMed Joint Venture in September 2005 for
the RevVac safety syringe. In January 2009, this second patent for the RevVac
safety syringe was issued by the U.S. patent office and published in April 2009.
During the quarter ended September 30, 2008, the Company filed international
patent protection rights regarding the RevVac Safety Syringe in the following
countries: Australia, China, Japan, Taiwan, Mexico, Canada and Europe.
Revolutions Medical Patent Applications and License to Color MRI Technology
- ---------------------------------------------------------------------------
The Company owns four (4) separate patent applications, filed September
15, 2006. There is no assurance that any patent protections will be secured. The
lack of patent protection, whether foreign or domestic, could allow competitors
to copy and sell products based on our designs without paying us a royalty,
which could have a material adverse effect on the Company's business.
In 1996, a former subsidiary of the Company, Clear Image, Inc.,
acquired an exclusive license to a color MRI technology from the University of
South Florida Research Foundation ("USFRF").In 2002, USFRF notified Clear Image
that the license was terminated because Clear Image had not used its "best
efforts", an assertion which Clear Image disputed. 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 USFRF to permit
it to proceed regardless of the status of the license from USFRF. The Company
believes that its color MRI technology does not rely on the license; however,
the legal implications are uncertain. There is no assurance that this 2002
dispute with USFRF will not recur.
11
AMOUNTS DUE TO CONSULTANTS
- --------------------------
During the year ended December 31, 2008, the Company entered into a
commitment with a third party who would obtain the breast biopsy and needle
localization technology. The Company has paid $30,000 as of March 31, 2009, and
expects to pay another $210,000 by the end of the second quarter.
NOTE 5 - PREFERRED STOCK AND COMMON STOCK TRANSACTIONS
SERIES 2006 PREFERRED STOCK
The Company has authorized 5,000,000 shares of its Series 2006
preferred stock, of which 1,000,000 shares are outstanding. All 1,000,000
outstanding shares of Series 2006 preferred stock are owned by Rondald L. Wheet,
our Chairman, President and CEO. Because each share of Series 2006 preferred
stock is entitled to 125 votes per share, Mr. Wheet has voting control of the
Company with votes representing 125,000,000 common shares.
Voting Rights: A Series 2006 preferred stock holder is entitled to 125
votes for each share of common stock into which his Series 2006 Preferred Stock
is then convertible (presently on a one for one basis), voting together with our
common stock as a single class. Cumulative voting is not permitted. Upon
conversion of each Series 2006 preferred share, each share of common stock
issued will be entitled to only one (1) vote per common share.
A Series 2006 preferred stock holder is entitled to receive, ratably,
dividends when, as and if declared by the board of directors out of legally
available funds to pay dividends. If any dividend or other distributions are
declared on our common stock, then a dividend or other distribution must also be
declared on the outstanding Series 2006 preferred stock at the same time and on
the same terms and conditions, so that each holder of Series 2006 preferred
stock will receive the same dividend or distribution such holder would have
received if the holder had converted his Series 2006 Preferred stock as of the
record date for determining stockholders entitled to receive such dividend or
distribution.
Liquidation Preference: In the event of the liquidation, dissolution or
winding up, a Series 2006 preferred stock is entitled to receive a liquidation
preference of $0.001 for each share of Series 2006 preferred stock held prior to
payment being made to any junior stock.
Conversion: A Series 2006 preferred stock holder may convert one (1)
share of preferred stock into one (1) share of common stock.
Preemption: A Series 2006 Preferred stock holder has no preemptive
rights and is not subject to further calls or assessments.
Redemption: There are no redemption or sinking fund provisions
applicable to the Series 2006 Preferred stock.
BLANK CHECK PREFERRED STOCK
The Company's Articles of Incorporation authorize its board of
directors to establish one or more additional series of preferred stock and to
determine, with respect to any such series of preferred stock, its terms and
rights, including: the designation of each series; the voting powers, if any,
associated with each such series whether dividends, if any, will be cumulative
or noncumulative and the dividend rate of each series; the redemption rights and
price or prices, if any, for shares of each series; and preferences and other
special rights, if any, of shares of each series in the event of any
liquidation, dissolution, or distribution of the Company's assets.
COMMON STOCK TRANSACTIONS FOR THE THREE MONTHS ENDED MARCH 31, 2009
During the three months ended March 31, 2009, 2,637,500 shares of
common stock were issued as option holders exercised their options to purchase
common stock and 181,118 shares were issued to third party investors. The
Company received proceeds of $350,635 in connection with these share issuances.
During the three months ended March 31, 2009, the Company issued an
additional 380,000 shares of common stock with a total value of $229,300 in
lieu of cash as payment for consulting services.
12
NOTE 6 - STOCK OPTIONS AND WARRANTS OUTSTANDING
The following tables summarize information about the stock options
outstanding at March 31, 2009:
WEIGHTED
AVERAGE
OPTIONS EXERCISE PRICE
------------------------------
Balance at December 31, 2008 10,360,000 $ 0.157
Granted 1,350,000 0.176
Exercised (2,637,500) 0.129
Expired/Forfeited --
---------------------------
BALANCE AT MARCH 31, 2009 9,072,500 0.146
===========================
NOTE 7 - FINANCIAL ADVISORY AND INVESTMENT BANKING AGREEMENT
The Company entered into a financial advisory and investment banking
agreement with Spartan Securities Group, LTD. The agreement engaged Spartan on a
non-exclusive basis for two years to provide services to include, but not
limited to, arranging meetings with investment banking firms, rendering advice
on internal operations, rendering advice on corporate finance matters, rendering
advice or assistance on merger or acquisition activities and rendering advice on
capital raising activities. Spartan will be compensated with commissions based
on specified percentages in the contract related to the aggregate consideration
received in the underlying merger or acquisition, equity placement, third party
debt placement transaction. In certain transactions Spartan may be eligible to
receive warrants to purchase common stock of the Company. This contract was
terminated in December 2008 and 60,000 shares at a value of $12,600 were issued
for services rendered.
NOTE 8- MANAGEMENT CONSULTING, BUSINESS ADVISORY, SHAREHOLDER AND PUBLIC
RELATIONS AGREEMENT
On March 25, 2009, the Company signed a six-month agreement with a Japanese
firm to serve as an institutional public relations consultant as well as an
investment banking liaison to attempt to arrange financing for the purpose of
working capital as an intermediary. This is a non-exclusive contract for which
the consultant was paid 250,000 shares of common stock at a value of $150,000
and will be paid 7% of any financing raised going forward. This common stock
is restricted as to resell for six months.
ITEM 2. MANAGEMET'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
The following discussion should be read in conjunction with our
financial statements and the notes thereto included elsewhere in this Form 10-Q.
This Form 10-Q contains forward-looking statements regarding the plans and
objectives of management for future operations. This information may involve
known and unknown risks, uncertainties and other factors which may cause our
actual results, performance or achievements to be materially different from
future results, performance or achievements expressed or implied by any
forward-looking statements. Forward-looking statements, which involve
assumptions and describe our future plans, strategies and expectations, are
generally identifiable by use of the words "may," "will," "should," "expect,"
"anticipate," "estimate," "believe," "intend" or "project" or the negative of
these words or other variations on these words or comparable terminology. These
forward-looking statements are based on assumptions that may be incorrect, and
we cannot assure you that these projections included in these forward-looking
statements will come to pass. Our actual results could differ materially from
13
those expressed or implied by the forward-looking statements as a result of
various factors. See "QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK."
Since 1997, we have been working to design, develop and commercialize
retractable safety needle devices. Our present product development effort is
focused on the RevVac retractable safety syringe, which is designed specifically
to reduce accidental needle stick injuries. On February 6, 2007, the Company
announced an agreement with Strategic Product Development, Inc. ("SPD") to
provide FDA regulatory compliance, manufacturing management capabilities and
ongoing product development services. On March 5, 2007, the Company announced
that SON Medical, a privately held contract regulatory and testing consulting
firm located in the Boston area, was chosen to conduct lab testing for the
Company's RevVac retractable safety syringe. See "STATUS OF PLANNED PRODUCTS"
below.
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 Note 9
"Acquisition of Clear Image Acquisition Corp" to the consolidated financial
statements for the year ended December 31, 2008 appearing in the Company's
Annual Report on Form 10-K for the year ended December 31, 2008, as filed with
the Securities and Exchange Commission on March 31, 2009.
Because our planned products are in various stages of development, we
have no revenue. Our efforts to date have been funded almost entirely through
sales of our common stock. We require substantial additional capital to complete
the development of, to obtain approvals for and to begin commercializing the
RevVac retractable safety syringe and the Clear Image color MRI software. There
is no assurance that such capital will be available to us when needed, on
acceptable terms, or at all. There is no assurance that our planned products
will be commercially viable. Our present and future collaborative partners may
require significant amounts of time to complete product design, develop
manufacturing processes and/or to obtain specialized equipment, if any is
required. Our planned products will also require FDA approval before they can be
sold in the United States and similar approvals from foreign countries where our
products may be marketed. Obtaining government approval, whether in the U.S. or
elsewhere, is a time-consuming and costly process with no guarantee of approval.
It could be months, if ever, before our planned products are sold in
the United States or anywhere else in the world. Our business is subject to
numerous risks and uncertainties that are more fully described in "QUANTITATIVE
AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK."
STATUS OF PLANNED PRODUCTS
On April 23, 2009, the Company announced that it had acquired the
exclusive rights to license an FDA-approved breast biopsy localization system.
The Company recently signed a worldwide exclusive license agreement with
Strategic Product Development for an image-guided navigation system that
incorporates high accuracy breast biopsies systems ("BSS") to conventional
mammography systems, which number more than 50,000 globally. This technology has
already received 510K market clearance by the FDA. BSS facilitates accurate and
fast non-palpable lesions and micro calcification localization in the treatment
of breast cancer. It is a low-cost, standalone stereotactic image-based system
which uses data from a pair of mammograms to enable radiologists to accurately
position a localization needle or biopsy tool at the location of suspicious
abnormalities. The system can also be modified to leverage existing popular
biopsy tools. The technology can be used to provide a technology platform for
future development, including multi-modal breast imaging for the image fusion of
MRI and X-Ray images. The BSS will be modified to use Rev Med's proprietary
safety syringe technology as well. The Company believes that this technology has
the potential to be deployed in the vast majority of more than 50,000
mammography machines that are currently in use worldwide, including more than
15,000 in the United States.
On February 22, 2009, the Company announced that it had received
notification from the FDA that the 510K application for the Rev Vac Safety
Syringe has been approved. Furthermore, FDA approval is not needed for
educational and research use of our Rev Color and Rev 3D MRI software products.
The Company plans on marketing these products for such use very soon. In
December 2008, the Company filed for patent protection in Europe on its Rev
Color and Rev 3D software.
14
The Rev Vac Safety Syringe uses vacuum technology to suck the needle
into the plunger after use. The syringe cannot be reused once the vacuum is
activated. Rev Med believes its safety syringe has many advantages over its
competition including price, ease of use, and safety. It should help reduce
accidental needle stick injuries and also aid in reducing the spread of
contagious diseases. You may view a video of the syringe in use on our website
at www.revolutionsmedical.com. The Company also believes that with the help of
government regulation initiatives, individual state laws, and the importance of
world health concerns, the safety syringe market will continue to have
substantial growth into the foreseeable future.
When an MRI is taken, the images are sent to a pictorial archival
computer systems ("PACS"), which displays the images for a radiologist to view.
RevMed has hired and announced Strategic Product Development ("SPD") to be its
project design consultant for the purpose of implementing the RevColor MRI
software (including 3-D and automatic segmentation) on a PACS delivery platform
and has given approval for SPD to enter into a binding letter of intent with
Cambridge Medical Information Corporation ("CMIC") to use their PACS delivery
platform, known as zPACS, which is an advanced fully functional PACS system
currently in operation at several major international hospitals. The estimated
cost of this project is $400,000, which RevMed is working to raise. A video of
the MRI software can be found on the Company's website.
LIQUIDITY, CAPITAL RESOURCES AND CASH REQUIREMENTS
- --------------------------------------------------
The following discussion of our cash requirements and liquidity and
resources contains forward-looking statements that are based upon current
expectations. These forward-looking statements fall within the meaning of the
federal securities laws that relate to future events or our future financial
performance. In some cases, you can identify forward-looking statements by
terminology such as "may," "will," "expect," "plan," "anticipate," "believe,"
"estimate," "intend," "potential" or "continue" or the negative of these terms
or other comparable terminology. Forward-looking statements involve risks and
uncertainties. Our actual results and the timing of events could differ
materially from those anticipated in our forward-looking statements as a result
of many factors; including, our ability to obtain financing when needed. A
discussion of these risks and uncertainties can be found under the heading
"RISKFACTORS" and elsewhere in this report. We cannot guarantee future results,
levels of activity, performance or achievements. We assume no obligation to
update any of the forward-looking statements after the date of this report or to
conform these forward-looking statements to actual results.
LIQUIDITY AND CAPITAL RESOURCES AND CASH REQUIREMENTS
- -----------------------------------------------------
As of March 31, 2009, the Company did not have and continues to not
have sufficient cash to pay present obligations as they become due. We are
searching for additional financing to generate the liquidity necessary to
continue our operations. Due to current economic conditions and the Company's
risks and uncertainties, there is no assurance that we will be able to raise any
additional capital on acceptable terms, if at all. Because of these
uncertainties, the auditors have expressed substantial doubt about our ability
to continue as a going concern. We do not presently have any investment banking
or advisory agreements in place and due to the Company's risks and
uncertainties, there is no assurance that we will be successful in establishing
any such agreements. Even if such agreements are established, there is no
assurance that they will result in any funding. If we obtain additional funds by
selling any of our equity securities or by issuing common stock to pay current
or future obligations, the percentage ownership of our stockholders will be
reduced, stockholders may experience additional dilution, or the equity
securities may have rights preferences or privileges senior to the common stock.
If adequate funds are not available to us on satisfactory terms, we may be
required to cease operating or otherwise modify our business strategy. See "RISK
FACTORS."
Because we do not currently generate any cash from operations and have
no credit facilities available, our only means of funding is through the sale of
our common stock. We presently have 250,000,000 shares of common stock
authorized, of which 30,081,813 shares were issued and outstanding as of
March 31, 2009. If we obtain additional funds by selling any of our equity
securities or by issuing common stock to pay current or future obligations, the
percentage ownership of our stockholders will be reduced, stockholders may
experience additional dilution, or the equity securities may have rights
preferences or privileges senior to the common stock. If adequate funds are not
available to us when needed on satisfactory terms, we may be required to cease
operating or otherwise modify our business strategy.
15
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
You should carefully consider the risks described below, together with
all of the other information included in this report, in considering our
business and prospects. The risks and uncertainties described below are not the
only ones facing the Company. Additional risks and uncertainties not presently
known to us or that we currently deem immaterial also may impair our business
operations. The occurrence of any of the following risks could harm our
business, financial condition or results of operations.
BECAUSE WE HAVE NO PRODUCTS FOR SALE, WE DO NOT GENERATE REVENUE AND DO NOT
HAVEOTHER RESOURCES TO FUND OPERATIONS; THESE CONDITIONS RAISE SUBSTANTIAL DOUBT
ABOUT OUR ABILITY TO CONTINUE AS A GOING CONCERN
Because the Company's planned products are in the development stage,
the Company has no revenue, earnings or cash flow to be self-sustaining. It
could be several more years before the Company can expect to have sales. The
Company's independent accountants have stated, in their opinion to the audited
financial statements for the period ended December 31, 2008, "the Company is a
development stage company with insufficient revenues to fund development and
operating expenses. The Company also has insufficient cash to fund obligations
as they become due. These conditions raise substantial doubt about its ability
to continue as a going concern." Our failure to obtain the funding necessary to
continue our activities will have a material adverse effect on our business,
financial condition, and on the price of our common stock.
WE REQUIRE SUBSTANTIAL ADDITIONAL CAPITAL TO CONTINUE DEVELOPING OUR PLANNED
PRODUCTS. WE MAY HAVE DIFFICULTY RAISING CAPITAL WHEN WE NEED IT, OR AT
ALL.RAISING SUCH CAPITAL MAY DILUTE STOCKHOLDER VALUE. IF WE ARE UNABLE TO
RAISECAPITAL, WE MAY BE REQUIRED TO LIMIT OR CEASE OUR OPERATIONS, OR OTHERWISE
MODIFY OUR BUSINESS STRATEGY.
The Company requires an estimated $4.8 million in capital over the next
twelve months; $1.0 million of which is for costs to finalize product
development and to begin beta testing for the color MRI technology; $1.25
million to setup syringe manufacturing; $0.75 million for breast biopsy system
manufacturing setup; $0.5 million for distribution and sales for all three
products and $0.5 million for working capital to cover expenses, such as rent,
telephone, auditing, financial reporting requirements, and administrative
expenses, including salaries; and $800,000 for outstanding liabilities. There is
no assurance, however, that we will be successful in raising the funds when
needed, on acceptable terms, or at all. There is no assurance that development
of our planned products will not require a significant amount of time to
commence or to complete and there is no assurance that the costs will not be
significantly greater than current estimates.
We will require substantial additional capital thereafter to
commercialize our planned products. Our commercialization efforts will include,
but are not limited to, entering into agreements with third parties for
manufacturing (including building molds, designing manufacturing processes and
obtaining specialized equipment for our retractable safety syringe), marketing
and distribution, and obtaining FDA and/or other regulatory approvals, all of
which are necessary before our planned products can be sold and which may take a
significant amount of time, if not years, to complete.
Due to the current economic conditions and the risks and uncertainties
surrounding our Company, we may not be able to secure additional financing on
acceptable terms, if at all. If we obtain additional funds by selling any of our
equity securities, the percentage ownership of our stockholders will be reduced,
stockholders may experience substantial dilution, the price of our common stock
may decline, or the equity securities issued may have rights, preferences or
Privileges senior to the common stock. To the extent that services are paid for
with common stock or stock options that are exercised and sold into the market,
the market price of our common stock could decline and your ownership interest
will be diluted. If adequate funds are not available to us on satisfactory
terms, we will be required to limit or cease our operations, or otherwise modify
our business strategy, which could materially harm our future business
prospects.
IF WE DO NOT OBTAIN FDA APPROVAL FOR OUR OTHER PLANNED PRODUCTS THEN OUR FUTURE
PROSPECTS WILL BE HARMED.
Our other planned products will require FDA approval before they can be
sold in the United States. There is no assurance that all of our planned
products will qualify for the FDA's 510(k) pre-market notification approval
process, which is less rigorous than a PMA.
16
The FDA approval process can take years and be expensive, especially if
a PMA is required. A PMA is much more rigorous and expensive to complete than a
510(k). In addition, the Medical Device User Fee and Modernization Act, enacted
in 2002, now allows the FDA to assess and collect user fees for 510(k) and for
PMA applications. There is no assurance that we will have the funds necessary
to apply for or obtain FDA approval for our other planned products.
The FDA approval process could take a significant amount of time, if
not years, to complete and there is no assurance that FDA approval will ever be
obtained. If FDA approval is not obtained, then we will not be able to sell our
products in the United States, which would have a material adverse effect on our
future business prospects.
OUR PLANNED PRODUCTS MAY PROVE TO BE TOO EXPENSIVE TO MANUFACTURE AND
MARKETSUCCESSFULLY, WHICH WOULD HARM OUR FUTURE PROSPECTS.
Our planned products may prove to be too expensive to manufacture and
market successfully. Market acceptance of our products will depend in large part
upon our ability to demonstrate the operational and safety advantages of our
product as well as the cost effectiveness of our product compared to both
standard and other safety needle products. If we are unable to produce products
that are competitive with standard products, we will not be able to sell our
products. This could have a material adverse effect on our operations.
IF WE ARE NOT ABLE TO ENTER INTO MANUFACTURING ARRANGEMENTS FOR OUR
PLANNEDPRODUCTS THEN OUR FUTURE PROSPECTS WILL BE HARMED.
We have no experience in establishing, supervising or conducting
commercial manufacturing. We plan to rely on third party contractors to
manufacture our planned products. We may never be successful in establishing
manufacturing capabilities for our planned products. Relying on third parties
may expose us to the risk of not being able to directly oversee the
manufacturing process, which may adversely affect the production and quality of
our planned products. Furthermore, these third-party contractors, whether
foreign or domestic, may experience regulatory compliance difficulty, mechanical
shutdowns, employee strikes, or other unforeseeable acts that may delay or
prevent production. We may not be able to manufacture our retractable safety
needle in sufficient quantities at an acceptable cost, or at all, which could
materially adversely affect our future prospects.
IF WE ARE NOT ABLE TO ESTABLISH MARKETING, SALES AND DISTRIBUTION ARRANGEMENTS
FOR OUR SAFETY NEEDLE DEVICES THEN OUR FUTURE PROSPECTS WILL BE HARMED.
We must establish marketing, sales and distribution capabilities before
our planned products can be sold. We have no experience in establishing such
capabilities. Until we have established manufacturing arrangements, we do not
plan to devote any meaningful time or resources to establishing marketing sales
or distribution capabilities. We intend to enter into agreements with third
parties in the future to market, sell and distribute our planned products.
However, we may be unable to establish or maintain third-party relationships on
a commercially reasonable basis, if at all. In addition, these third parties may
have similar or more established relationships with our competitors.
If we do not enter into relationships with third parties to market,
sell and distribute our planned products, we will need to develop our own such
capabilities. We have no experience in developing, training or managing a sales
force. If we choose to establish a direct sales force, we will incur substantial
additional expenses in developing, training and managing such an organization.
We may not be able to build a sales force on a cost effective basis or at all.
Any such direct marketing and sales efforts may prove to be unsuccessful. In
addition, we will compete with many other companies that currently have
extensive and well-funded marketing and sales operations. Our marketing and
sales efforts may be unable to compete against these other companies. We may be
unable to establish a sufficient sales and marketing organization on a timely
basis, if at all. We may be unable to engage qualified distributors. Even if
engaged, they may fail to satisfy financial or contractual obligations to us.
They may fail to adequately market our products. They may cease operations with
little or no notice to us or they may offer, design, manufacture or promote
competing products.
17
IF WE ARE UNABLE TO PROTECT OUR PLANNED PRODUCTS, OR TO AVOID INFRINGING ON
THERIGHTS OF OTHERS, OUR ABILITY TO COMPETE WILL BE IMPAIRED.
General Risks Related to Intellectual Property
- ----------------------------------------------
The Company does not yet have patent protection for some of its planned
products and there is no assurance that such patent protections will be sought
or secured. We do not have foreign patent protection for any of our planned
products. There is no assurance that we will have the financial resources to
apply for U.S. or foreign patent protections, that such U.S. or foreign patent
protections will be available to us or if available, that they will result in
any meaningful protection for our planned products. Even if we are successful in
obtaining patent protection, whether in the U.S. or abroad, it may not afford
protection against competitors with similar technology. Furthermore, others may
independently develop similar technologies or duplicate our technology.
Our commercial success depends in part on our avoiding the infringement
of patents and proprietary rights of other parties and developing and
maintaining a proprietary position with regard to our own technologies and
products. We cannot predict with certainty whether we will be able to enforce
our patents. We may lose part or all of patents we may receive in the future as
a result of challenges by competitors. Patents that may be issued, or
publications or other actions could block our ability to obtain patents or to
operate as we would like. Others may develop similar technologies or duplicate
technologies that we have developed or claim that we are infringing their
patents.
Although we rely on trade secrets to protect our technology and require
certain parties to execute nondisclosure and non-competition agreements, these
agreements could be breached, and our remedies for breach may be inadequate. In
addition, our trade secrets may otherwise become known or independently
discovered by our competitors. If we lose any of our trade secrets, our business
and ability to compete could be harmed.
Despite our efforts to protect our proprietary rights, we face the
risks that pending patent applications may not be issued, that patents issued to
us may be challenged, invalidated or circumvented; that unauthorized parties may
obtain and use information that we regard as proprietary; that intellectual
property laws may not protect our intellectual property; and effective
protection of intellectual property rights may be limited or unavailable in
China, where we plan to manufacture our retractable safety syringe, or in other
foreign countries where we may manufacture and/or sell our retractable safety
needle devices. The lack of adequate remedies and impartiality under any foreign
legal system may adversely impact our ability to protect our intellectual
property.
We may become involved in litigation or interference proceedings
declared by the U.S. Patent and Trademark Office, or oppositions or other
intellectual property proceedings outside of the United States. If any of our
competitors have filed patent applications or obtained patents that claim
inventions that we also claim, we may have to participate in an interference
proceeding to determine who has the right to a patent for these inventions in
the United States. If a litigation or interference proceeding is initiated, we
may have to spend significant amounts of time and money to defend our
intellectual property rights or to defend against infringement claims of others.
Litigation or interference proceedings could divert our management's time and
effort. Even unsuccessful claims against us could result in significant legal
fees and other expenses, diversion of management time and disruption in our
business. Any of these events could harm our ability to compete and adversely
affect our business.
An adverse ruling arising out of any intellectual property dispute
could invalidate or diminish our intellectual property position. An adverse
ruling could also subject us to significant liability for damages, prevent us
from using processes or products, or require us to license intellectual property
from third parties. Costs associated with licensing arrangements entered into to
resolve litigation or an interference proceeding may be substantial and could
include ongoing royalties. We may not be able to obtain any necessary licenses
on satisfactory terms or at all.
18
WE MUST OBTAIN REGULATORY APPROVALS IN FOREIGN JURISDICTIONS TO MARKET OUR
PRODUCTS ABROAD
Whether or not FDA approval has been obtained, we must secure approval
for our planned products by the comparable non-U.S. regulatory authorities prior
to the commencement of marketing of the product in a foreign country. The
process of obtaining these approvals will be time consuming and costly. The
approval process varies from country to country and the time needed to secure
additional approvals may be longer than that required for FDA approval. These
applications may require the completion of pre-clinical and clinical studies and
disclosure of information relating to manufacturing and controls. Unanticipated
changes in existing regulations or the adoption of new regulations could affect
the manufacture and marketing of our products.
IF WE ARE NOT ABLE TO COMPETE SUCCESSFULLY, THEN OUR BUSINESS PROSPECTS WILL BE
MATERIALLY ADVERSELY AFFECTED.
Our retractable safety syringe, if developed and commercialized, will
compete in the United States and abroad with the safety needle devices and
standard non-safety needle devices manufactured and distributed by companies
such as Becton Dickinson, Tyco International, Inc. (Kendall Healthcare Products
Company), B. Braun, Terumo Medical Corporation of Japan, Med-Hut, Inc. and
Johnson & Johnson. Developers of safety needle devices against which we could
compete include Med-Design Corp., New Medical Technologies, Retractable
Technologies, Inc., Univec, Inc. and Specialized Health Products International,
Inc. Our Color MRI technology, if developed, approved and commercialized, will
compete in the United States and abroad against technologies manufactured and
distributed by companies such as GE and Siemens. Most of our competitors are
substantially larger and better financed than we are and have more experience in
developing medical devices and/or software than we do. These competitors may use
their substantial resources to improve their current products or to develop
additional products that may compete more effectively with our planned products,
or may render our planned products obsolete. In addition, new competitors may
develop products that compete with our planned products, or new technologies may
arise that could significantly affect the demand for our planned products. Even
if we are successful in bringing our planned products to market, there is no
assurance that we can successfully compete. We cannot predict the development of
future competitive products or companies.
In the U.S., the vast majority of decisions relating to the contracting
for and purchasing of medical supplies are made by the representatives of group
purchasing organizations ("GPOs") rather than the end-users of the product
(nurses, doctors, and testing personnel). GPOs and manufacturers often enter
into long-term exclusive contracts which can prohibit entry in the marketplace
by competitors. In the needle and syringe market, the market share leader, BD,
has utilized, among other things, long-term exclusive contracts which have
restricted entry into the market by most of our competitors. We may not be
successful in obtaining any contracts with GPO's, which would severely limit our
product's marketability in the U.S. We will be materially adversely affected if
we are unable to compete successfully.
BECAUSE WE DEPEND ON A SINGLE TECHNOLOGY, WE ARE VULNERABLE TO SUPERIOR
COMPETING PRODUCTS OR NEW TECHNOLOGIES THAT COULD MAKE OUR RETRACTABLE SAFETY
NEEDLE DEVICES OR OUR COLOR MRI TECHNOLOGY OBSOLETE
Because we have a narrow focus on a particular product and technology
(e.g. retractable safety syringe and color MRI technology), we are vulnerable to
the development of superior competing products and to changes in technology
which could eliminate or reduce the need for our products. If a superior
technology is created, the demand for our product could greatly diminish causing
our commercialization efforts and future prospects to be materially adversely
affected.
BECAUSE WE RELY ON THIRD PARTIES FOR RESEARCH AND DEVELOPMENT ACTIVITIES
NECESSARY TO COMMERCIALIZE OUR PRODUCT, WE HAVE LESS DIRECT CONTROL OVER THOSE
ACTIVITIES. THIS COULD HAVE A MATERIALLY ADVERSE EFFECT ON OUR FUTURE PROSPECTS.
We do not maintain our own laboratory and we do not employ our own
researchers. We have contracted with third parties in the past to conduct
research, development and testing activities and we expect to continue to do so
in the future. Because we rely on such third parties, we have less direct
control over those activities and cannot assure you that the research will be
done properly or in a timely manner, or that the results will be reproducible.
Our inability to conduct research and development may delay or impair our
ability to develop, obtain approval for and commercialize our retractable safety
syringe. The cost and time to establish or locate an alternative research and
development facility to develop our technology could have a materially adverse
effect on our future prospects.
19
YOUR OWNERSHIP INTEREST MAY BE DILUTED AND THE VALUE OF THE SHARES OF OUR
COMMONSTOCK MAY DECLINE BY THE EXERCISE OF STOCK OPTIONS AND WARRANTS WE HAVE
GRANTEDOR MAY GRANT IN THE FUTURE AND BY THE COMMON STOCK WE HAVE ISSUED OR WILL
ISSUEIN THE FUTURE.
On April 24, 2007, the Company registered 20,000,000 shares of its
common stock reserved under its 2007 Stock Option Plan. The Company plans to
grant substantial portion of these reserved shares to its officers and
directors. If and when, and to the extent that, those shares are sold into the
market, they could cause the market price of our common stock to decline.
As of the date of this report, we had a total of 7,722,500 options
outstanding to purchase shares of common stock at exercise prices ranging from
$0.08 to $10.00 per share (of which all were exercisable). To the extent that
the outstanding options to purchase our common stock are exercised, your
ownership interest may be diluted. If the options are exercised and sold into
the market, they could cause the market price of our common stock to decline.
From time to time the Company has issued and plans to continue to issue
shares of its common stock to pay current and future obligations. If and when,
and to the extent that, those shares are sold into the market, they could cause
the market price of our common stock to decline.
As of March 31, 2009, the Company had 250,000,000 shares authorized
and 30,081,813 shares outstanding. The authorized but unissued shares have the
same rights and privileges as the common stock presently outstanding. The
unissued authorized shares can be issued without further action of the
shareholders. If and when, and to the extent that, the unissued authorized
shares are issued and sold into the market, they could cause the market price of
our common stock to decline.
THE LOSS OF THE SERVICES OF CERTAIN THIRD PARTIES AND OUR OFFICER AND
DIRECTORCOULD HAVE A MATERIAL ADVERSE EFFECT ON OUR BUSINESS.
We are dependent upon the services of third parties related to
development and commercialization of our planned products. The loss of their
services and the inability to retain acceptable substitutes could have a
material adverse effect on our future prospects. We are also dependent upon the
services of Ron Wheet, our officer and director. The loss of his services or our
inability to retain suitable replacements could have a material adverse effect
on our ability to continue operating.
BECAUSE WE HAVE LIMITED EXPERIENCE IN THE MEDICAL DEVICE INDUSTRY AND OUR
OFFICER AND DIRECTORS HAVE OTHER BUSINESS INTERESTS, OUR BUSINESS MAY TAKE
LONGER TO DEVELOP, WHICH COULD ADVERSELY AFFECT OUR FUTURE PROSPECTS.
We have had limited experience in the medical device industry. In
addition, our officer and directors may be involved in a range of business
activities that are not related to our business. Consequently, there are
potential conflicts in the amount of time he can devote to our business. Not
more than 50% of his time will be devoted to RMCP's activities. Consequently,
our business may take longer to develop, which could adversely affect our future
prospects.
IF WE CANNOT GENERATE ADEQUATE, PROFITABLE SALES OF OUR PLANNED PRODUCTS, WE
WILL NOT BE SUCCESSFUL
In order to succeed as a company, we must develop commercially viable
products and sell adequate quantities at a high enough price to generate a
profit. We may not accomplish these objectives. Even if we succeed in developing
a commercially viable product, a number of factors may affect future sales of
our product. These factors include:
- Whether we will be successful in obtaining FDA approval in the
future;
- Whether physicians, patients and clinicians accept our product
as a viable, safe alternative to the standard medical syringe;
- Whether the cost of our product is competitive in the medical
marketplace; and
- Whether we successfully contract the manufacture and marketing
of the syringe to third parties or develop such capabilities
ourselves
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OUR PLANNED PRODUCTS, IF SUCCESSFULLY COMMERCIALIZED, COULD BE EXPOSED
TOSIGNIFICANT PRODUCT LIABILITY CLAIMS WHICH COULD BE TIME CONSUMING AND COSTLY
TODEFEND, DIVERT MANAGEMENT ATTENTION AND ADVERSELY IMPACT OUR ABILITY TO
OBTAINAND MAINTAIN INSURANCE COVERAGE, WHICH COULD JEOPARDIZE OUR LICENSE.
The testing, manufacture, marketing and sale of our planned products
will involve an inherent risk that product liability claims will be asserted
against us. We currently do not have insurance which relates to product
liability, but will seek to obtain coverage at such time as we have a product
ready to sell, although there is no assurance we will be able to obtain or to
pay for such coverage. Even if we obtain product liability insurance, it may
prove inadequate to cover claims and/or costs related to potential litigation.
The costs and availability of product liability insurance are unknown. Product
liability claims or other claims related to our planned product, regardless of
their outcome, could require us to spend significant time and money in
litigation onto pay significant settlement amounts or judgments. Any successful
product liability or other claim may prevent us from obtaining adequate
liability insurance in the future on commercially desirable or reasonable terms.
In addition, product liability coverage may cease to be available in sufficient
amounts or at an acceptable cost. Any inability to obtain sufficient insurance
coverage at an acceptable cost or otherwise to protect against potential product
liability claims could prevent or inhibit the commercialization of our planned
product. A product liability claim could also significantly harm our reputation
and delay market acceptance of our planned products.
STRINGENT, ONGOING GOVERNMENT REGULATION AND INSPECTION OF OUR PLANNED
PRODUCTSCOULD LEAD TO DELAYS IN MANUFACTURE, MARKETING AND SALES
The FDA continues to review products even after they receive FDA
approval. If and when the FDA approves our planned products, manufacturing and
marketing will be subject to ongoing regulation, including compliance with
current Good Manufacturing Practices, adverse reporting requirements and the
FDA's general prohibitions against promoting products for unapproved or
"off-label" uses. We and any third party manufacturers we may use are also
subject to inspection and market surveillance by the FDA for compliance with
these and other requirements. Any enforcement action resulting from failure to
comply with these requirements could affect the manufacture and marketing of our
planned products. In addition, the FDA can withdraw a previously approved
product from the market at any time, upon receipt of newly discovered
information.
HEALTHCARE REFORM AND CONTROLS ON HEALTHCARE SPENDING MAY LIMIT THE PRICE WE
CANCHARGE FOR OUR PLANNED PRODUCTS AND THE AMOUNT WE CAN SELL
The federal government and private insurers have considered ways to
change, and have changed, the manner in which healthcare services are provided
in the United States. Potential approaches and changes in recent years include
controls on healthcare spending and the creation of large purchasing groups. In
the future, it is possible that the government may institute price controls and
limits on Medicare and Medicaid spending. These controls and limits might affect
the payments we collect from sales of our product, if and when it is
commercially available. Assuming we succeed in bringing our product to market,
uncertainties regarding future healthcare reform and private practices could
impact our ability to sell our product in large quantities at profitable
pricing.
It is quite possible that new regulations could be proposed and adopted
which could restrict marketing of our products. Although we are not presently
aware of any such pending or proposed regulations, there is no assurance that
they will not be enacted or imposed.
UNCERTAINTY OF THIRD-PARTY REIMBURSEMENT COULD AFFECT OUR ABILITY TO SELL
OURPLANNED PRODUCTS AT A PROFIT
Sales of medical products largely depend on the reimbursement of
patients' medical expenses by governmental healthcare programs and private
health insurers. There is no guarantee that governmental healthcare programs or
private health insurers will cover the cost of our product, if and when it is
commercially available, or permit us to sell our product at a high enough price
to generate a profit.
OUR LIMITED OPERATING HISTORY MAKES EVALUATING OUR STOCK MORE DIFFICULT
Since inception in 1996, we have engaged primarily in research and
development, technology licensing, and raising capital. This limited history may
not be adequate to enable you to fully assess our ability to develop and
commercialize our planned products and to achieve market acceptance of our
planned products and to respond to competition.
21
WE HAVE A HISTORY OF LOSSES AND EXPECT FUTURE LOSSES
We have had annual losses since our inception in 1996. We expect to
continue to incur losses until we can sell enough products at prices high enough
to generate a profit. As of March 31, 2009, we had accumulated a deficit of
approximately $(20,840,395). There is no assurance that our planned products
will be commercially viable. There is no assurance that we will generate revenue
from the sale of our planned products or that we will achieve or maintain
profitable operations.
OUR STOCK PRICE IS VOLATILE AND YOUR INVESTMENT IN OUR SECURITIES COULD
DECLINEIN VALUE, RESULTING IN SUBSTANTIAL LOSSES TO YOU
The market price of our common stock, which is over the counter
bulletin board under the symbol "OTCBB:RMCP," has been, and may continue to be,
highly volatile. Factors such as announcements of product development progress,
financings, technological innovations or new products, either by us or by our
competitors or third parties, as well as market conditions within the medical
devices industry may have a significant impact on the market price of our common
stock. In general, medical device stocks tend to be volatile even during periods
of relative market stability because of the high rates of failure and
substantial funding requirements associated with medical device companies.
Market conditions and conditions of the medical device sector could also
negatively impact the price of our common stock.
BECAUSE OUR STOCK IS CONSIDERED TO BE A "PENNY STOCK", YOUR ABILITY TO SELL YOUR
STOCK MAY BE LIMITED
The Penny Stock Act of 1990 requires specific disclosure to be made
available in connection with trades in the stock of companies defined as "penny
stocks". The Securities and Exchange Commission (SEC) has adopted regulations
that generally define a penny stock to be any equity security that has a market
price of less than $5.00 per share, subject to certain exceptions. If an
exception is unavailable, the regulations require the delivery, prior to any
transaction involving a penny stock, of a disclosure schedule explaining the
penny stock market and the risk associated therewith as well as the written
consent of the purchaser of such security prior to engaging in a penny stock
transaction. The regulations on penny stock may limit the ability of the
purchasers of our securities to sell their securities in the secondary
marketplace.
ALTHOUGH WE BELIEVE THAT OUR SYSTEM OF DISCLOSURE CONTROLS AND INTERNAL
CONTROLSOVER FINANCIAL REPORTING ARE ADEQUATE, SUCH CONTROLS ARE SUBJECT TO
INHERENTLIMITATIONS.
Although we believe that our system of disclosure controls and internal
controls over financial reporting are adequate, we cannot assure you that such
controls will prevent all errors or all instances of fraud. A control system, no
matter how well designed and operated, can provide only reasonable, not
absolute, assurance that the control system's objectives will be met. Further,
the design of a control system must reflect the fact that there are resource
constraints, and the benefits of controls must be considered relative to their
costs. Because of the inherent limitations in all control systems, no evaluation
of controls can provide absolute assurance that all control issues and instances
of fraud, if any, within our company will be detected. These inherent
limitations include the realities that judgments in decision-making can be
faulty, and that breakdowns can occur because of simple error or mistake.
Controls can also be circumvented by the individual acts of some persons, by
collusion of two or more people, or by management override of the controls. The
design of any system of controls is based in part upon certain assumptions about
the likelihood of future events, and any design may not succeed in achieving its
stated goals under all potential future conditions. Over time, controls may
become inadequate because of changes in conditions or deterioration in the
degree of compliance with policies or procedures. Because of the inherent
limitation of a cost-effective control system, misstatements due to error or
fraud may occur and not be detected.
22
MR. WHEET, OUR CEO AND A DIRECTOR, HAS VOTING CONTROL OF THE COMPANY AND
CANUNILATERALLY MAKE BUSINESS DECISIONS FOR US. ALTHOUGH WE HAVE TWO
OUTSIDEDIRECTORS, THERE ARE NO PROCEDURES IN PLACE TO RESOLVE POTENTIAL
CONFLICTS ANDTO EVALUATE RELATED PARTY TRANSACTIONS THAT ARE TYPICALLY REVIEWED
BY INDEPENDENT DIRECTORS.
Because Mr. Wheet owns 1,000,000 Series 2006 Preferred shares, which
gives him the right to vote 125,000,000 shares in addition to the shares of
common stock he already owns, voting together as a single class with the
Company's common stock, he controls a majority of the Company's common stock
and can unilaterally make business decisions on our behalf. Although we recently
appointed two outside directors, there are no procedures in place to resolve
potential conflicts and evaluate related party transactions that are typically
reviewed by independent directors.
WE DO NOT EXPECT TO PAY DIVIDENDS
We have not declared or paid, and for the foreseeable future we do not
anticipate declaring or paying, dividends on our common stock.
ITEM 4T. CONTROLS AND PROCEDURES
The Company's disclosure controls and procedures are designed to ensure
(i) that information required to be disclosed by the Company in the reports the
Company files or submits under the Exchange Act are recorded, processed,
summarized, and reported within the time periods specified in the SEC's rules
and forms; and (ii) that information required to be disclosed by the Company in
the reports it files or submits under the Exchange Act is accumulated and
communicated to the Company's management, including its principal executive and
principal financial officer, or persons performing similar functions, as
appropriate to allow timely decisions regarding required disclosure.
Pursuant to rules adopted by the SEC as directed by Section 302 of the
Sarbanes-Oxley Act of 2002, the Company's management, with the participation of
the CEO/CFO, evaluated the effectiveness of the Company's disclosure controls
and procedures (as defined in the Securities Exchange Act of 1934
Rules13a-15(e)) as of March 31, 2009. Based on that evaluation, the Company's
CEO/CFO concluded that, as of that date, the Company's disclosure controls and
procedures required by paragraph (b) of Exchange Act Rules 13a-15 or 15d-15,
were effective at the reasonable assurance level. However, management's
assessment identified the following material weaknesses:
- As of March 31, 2009, there was a lack of accounting
personnel with the requisite knowledge of Generally Accepted
Accounting Principles ("GAAP") in the US and the financial
reporting requirements of the Securities and Exchange
Commission.
- As of March 31, 2009, there were insufficient written
policies and procedures to insure the correct application of
accounting and financial reporting with respect to the current
requirements of GAAP and SEC disclosure requirements.
- As of March 31, 2009, there was a lack of segregation of
duties, in that we only had one person performing all
accounting-related duties.
Notwithstanding the existence of these material weaknesses in our
internal control over financial reporting, our management believes that the
consolidated financial statements included in its reports fairly present in all
material respects the Company's financial condition, results of operations and
cash flows for the periods presented. The reason for the amendment of the
interim financial reports was due to a later decision that the technology
acquired did not have viable alternative uses, although it had originally been
thought that it might have, and had it been determined that there were viable
alternative uses the interim financial reports would have been correct.
The Company also disclosed these weaknesses in our Form 10-K filed on
March 31, 2009. We continue to evaluate the effectiveness of internal controls
and procedures on an on-going basis. We plan to further address these issues
once we commence operations and are able to hire additional personnel in
financial reporting.
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PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
On March 1, 2007, the Company filed a lawsuit in the District Court of
Tulsa County, Oklahoma against Globe Med Tech, Inc. ("Globe") to rescind,
terminate and seek monetary damages for the non-fulfillment and breach of a
joint venture agreement entered into November 3, 2005 and other related
agreements, in addition to an accounting of expenditures of funds under the
terms and provisions of the agreements. On May 11, 2007, a partial default
judgment against Globe was granted by the District Court of Harris County,
Texas. The partial default judgment as to liability only was granted with
respect to the Company's causes of action against Globe for breach of contract,
conversion and common law fraud with respect to the Company's Original Petition
and Application for Temporary and Permanent Injunctions against Globe on
January30, 2007. On August 13, 2007, the Company was granted a final default
judgment for permanent injunctive relief and for damages in the amount of
$14,029,000 against Globe. Globe has appealed the judgment. On November 23,
2007, the Court signed an order granting Globe's Motion for New Trial and
setting aside the Final Default Judgment entered in favor of the Company on
August 13, 2007.
On October 29, 2008, the Company filed a lawsuit in the district court
of Harris county Texas, a lawsuit for fraud and contempt of court for Globe Med
Tech and Andy Hu individually. In response, Globe filed a motion to stay the
lawsuit based upon the forum selection clause in the joint venture agreement
between RMC and Globe which provides that the exclusive forum for all disputes
relating to the Joint Venture Agreement shall be Oklahoma state court/Tulsa
County. Due to the Texas state district's court's backlog of cases and the
withdrawal of Globe and Hu's counsel, the motion to stay was not heard until May
1, 2009. The motion was granted as to Globe; however, Hu did not join in the
motion and, after the May 1st hearing, filed a separate motion to stay, based
upon the same grounds as Globe's motion. Hu's motion to stay was denied at a
May 8th hearing. Accordingly, RMC intends to proceed post haste with discovery
with respect to its claims against Hu, including without limitation obtaining
the deposition of a key witness.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
Equity transactions for the three months ended March 31, 2009 are
incorporated herein by reference to Part I- Financial Information- Notes to
Financial Statements- Note 5. "Preferred Stock and Common Stock Transactions."
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
31.1 Certification Pursuant to 18 U.S.C. 1350, as adopted pursuant
to Section 302 of 2002
32.1 Certification Pursuant to 18 U.S.C. 1350, as adopted pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002
b) Reports on Form 8-K
None.
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SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
REVOLUTIONS MEDICAL CORPORATION
/s/ Rondald L. Wheet
-----------------------
Rondald L. Wheet
Chief Executive Officer
Date: May 13, 2009
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the registrant and
in the capacities and on the dates indicated.
/s/ Rondald L. Wheet Chief Executive Officer and Director May 13, 2009
- -------------------- (Principal Executive Officer and
Rondald L. Wheet Principal Accounting Officer)
/s/ Dr. Thomas Beahm Director May 13, 2009
- --------------------
Dr. Thomas Beahm
/s/ THOMAS O'BRIEN Director May 13, 2009
- --------------------
Thomas O'Brien
25