SECURITIES AND EXCHANGE
COMMISSION


WASHINGTON, D.C.
20549




FORM
10-K/A




(Mark
One)




þANNUAL REPORT PURSUANT
TO SECTION 13 OR 15(d) OF THE




SECURITIES
EXCHANGE ACT OF 1934




For
the Fiscal Year Ended December 31, 2008




OR




oTRANSITION REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE




SECURITIES
EXCHANGE ACT OF 1934




REVOLUTIONS
      MEDICAL CORPORATON(Name of Registrant
      in its Charter)




(formerly
known as Maxxon, Inc.)




Nevada
            
            0-28629
            
            73-1526138(State or other
      jurisdiction of incorporation or organization)
            
            (SEC File
      Number)
            
            (I.R.S.
      Employer  Identification
Number)






670
MARINA DRIVE, 3RD
FLOOR


CHARLESTON,
SC 29492


(Address
of principal executive offices, including zip code)





(843)
971-4848


(Registrant's
telephone number, including area code)





(843)
971-6917


(Registrant's
facsimile number, including area code)




Securities
registered pursuant to Section 12(b) of the Act:




None




Securities
registered pursuant to Section 12(g) of the Act:




Common
Stock, $0.001 par value




Indicate
by check mark whether the registrant is a well-known seasoned issuer, as defined
in Rule 405 of the Securities Act. Yes oNo þ





Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Act. Yes oNo þ





Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days. YesþNo o





Indicate
by check mark if disclosure of delinquent filers in response to Item 405 of
Regulation S-K is not contained herein, and will not be contained, to the best
of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. o





Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, 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
            o
            Accelerated
      filer
            oNon-accelerated
      filer

              (Do
      not check if a smaller reporting company)
            o
            Smaller reporting
      company
            þ




Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Act). Yes oNo þ














State
issuer's revenues for its most recent fiscal year: $-0-




State the
aggregate market value of the voting and non-voting common equity held by
non-affiliates computed by reference to the price at which the common equity was
sold, or the average bid and asked price of such common equity, as of a
specified date within the past 60 days. $18,197,406 as of March 17,
2009.




State the
number of shares outstanding of each of the issuer's classes of common equity,
as of the latest practicable date: As of March 17, 2009, we had 29,831,813
shares of common stock, $0.001 par value, outstanding and 1,000,000 shares of
Series 2007 preferred stock, $0.001 par value outstanding.




EXPLANATORY
NOTE:




The
Company is filing this amended Form 10-K for the year ended December 31, 2008
for the following corrections:




1.
            Add
      discussion of our results of operations for the year ended December 31,
      2008 compared to the year ended December 31,
  2007




2.
            Correct
      Item 8a, Controls and procedures to correct the date and to explain our
      plans to remediate material
weaknesses.




3.
            Correct
      language related to Note 3 to the financial statements , Mutual Release
      and Settlement Agreement With Former
CEO




4.
            To
      expand verbiage in Note 1, Long-Lived Assets related to the goodwill on
      the financial statements.




5.
            To
      correct the Section 302 (Exhibits 31.1 and 31.2) and provided updated
      signed certifications of Section 906 certifications (Exhibit 99.1 and
      99.2)




1




FORWARD
LOOKING STATEMENTS




This
Report contains forward-looking statements within the meaning of The Private
Securities Litigation Reform Act of 1995 that address, among other things,
development-stage of our safety needle products, our pursuit of collaborative
arrangements; our need to obtain additional financing; factors affecting the
availability of capital; plans regarding the raising of capital. These
statements may be found under “Item 1- Business,” “Item 1- Risk Factors,” and
“Item 6 - Plan of Operation” as well as in this Report generally. We typically
identify forward-looking statements in this Report using words like “believe,”
“anticipate,” “will,” “expect,” “may,” “could,” “intend,” or similar statements.
There are important factors that could cause actual results to differ materially
from those expressed or implied by such forward-looking statements, primarily
our ability to raise additional capital to continue operating. Readers are
cautioned not to place undue reliance on these forward-looking statements, which
reflect management's analysis only as of the date hereof. We undertake no
obligation to publicly revise these forward-looking statements to reflect events
or circumstances that arise after the date hereof.




PART
I




ITEM
1. BUSINESS




Since
1997, we have been working to design, develop and commercialize retractable
safety needle devices. Our present product development effort is focused on the
ReVac retractable safety syringe, which is designed specifically to reduce
accidental needlestick 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 ReVac
retractable safety syringe. The results of the lab testing was used as part of
the Company's 510K submission to the FDA.




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. See “RISK FACTORS.”




On March
26, 2007, the Company completed the majority acquisition of the sole assets of
Clear Image Acquisition Corporation (“Acquisition Corp”) pursuant to the Plan
and Agreement of Reorganization of January 26, 2007. During the fourth quarter
of 2008, the Company completed a short form merger with the remaining
shareholders and now owns 100% of Acquisition Corp's proprietary technological
assets. See Note 9 “Acquisition of Clear Image Acquisition Corp” to the
consolidated financial statements.




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.




Clear
Image is a development stage company which has developed certain proprietary
technology and patent pending for (i) differential coloring, by series, of MRI
scans and (ii) auto-registration of the scan images. As a private company,
however, faced with the substantial competition of the leaders in the field of
MRI technology, Clear Image has had difficulty obtaining the necessary working
capital to complete the development of commercial components of its technology.
The Company, in acquiring control of Clear Image, believes that it can provide
sufficient working capital to complete commercialization of certain aspects of
Clear Image's technology to the point of supporting some licensing or joint
venture relationship financially adequate to permit Clear Image to complete the
development of the remaining aspects of its technology. There is no assurance
that the Company will be successful in raising the working capital necessary to
complete the technology, that the technology will be commercially viable,
approved by the FDA, or that the Color MRI technology will be accepted in the
marketplace. However, the color and 3-D automatic segmentation of gray-scale MRI
images do not need FDA approval for educational and research purposes. The
Company will start promoting this product for educational and research purposes
soon. See “RISK FACTORS”.




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.




2




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 USFRF to permit it to proceed regardless of the
status of the license from USFRF (see “RISK FACTORS” RISKS RELATED TO CLEARIMAGE
AND THE COLOR MRI TECHNOLOGY.). In addition, Clear Image owns four (4)separate
patent applications, filed in June of 2007 which were assigned over by Clear
Image's consultant, Richard Theriault. 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 43,
is Vice-President and Secretary of Clear Image and serves as a
director.




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 ReVac 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.




However,
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.




It could
be months 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 “RISK FACTORS.”




On May 1,
2008, the Financial Industry Regulatory Authority (FINRA) approved the Company's
common stock to begin trading on the Over the Counter Bulletin
Board.




2.
Distribution Method of Products and Services




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. See “RISK FACTORS.”





3


We
presently do not have any products for sale, but expect to have one or more
products for sale by the end of 2009. We plan to seek distribution arrangements
with established medical device manufacturers in the future, but there is no
assurance that we will be successful in establishing or maintaining such
relationships. See “RISK FACTORS.”




3. Status
of Planned Products




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.




This
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 are 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 pictural archival computer system
(“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 color 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.




4.
Competitive Business Conditions, Competitive Position and Methods of
Competition




The
safety medical device market is highly competitive. The leading manufacturers
and marketers of safety medical devices are Becton-Dickinson, Tyco
International, Inc. (Kendall Healthcare Products Company), B. Braun, Terumo
Medical Corporation of Japan, Medi-Hut, Inc. and Johnson & Johnson.
Developers of safety medical devices, which we compete against for license and
collaborative arrangements with medical device and pharmaceutical companies,
include Med-Design Corporation, New Medical Technologies, Retractable
Technologies, Inc., Univec, Inc. and Specialized Health Products International.
Our competitors have substantially greater assets, technical staffs, established
market shares, and greater financial and operating resources than we do. There
is no assurance that we can successfully compete. See “RISK
FACTORS.”




Traditionally,
competition regarding non-safety medical devices was primarily based upon price
with little differentiation between products. We expect our products to compete
against both safety products and non-safety products based upon safety and ease
of use and disposal. Most of the safety medical devices we will compete with are
priced substantially above the cost of non-safety products. Market demand for
safety devices is being driven by the estimated costs associated with accidental
needlesticks and by government mandates.




5.
Sources of Raw Materials and the Names of Principal Suppliers




We do not
presently manufacture any products, so we have no raw materials requirements at
this time. The materials used to make our planned products are commercially
available from a number of suppliers. The manufacturing process will be highly
technical and demanding, with very low fault tolerances. There is no assurance
that we will be able to engage a company capable of manufacturing the safety
syringe in a cost-effective manner or at all. See “RISK FACTORS.”




6.
Dependence on One or Few Major Customers




We
anticipate that our safety syringe will be marketed to the entire field of
medical professionals. We do not anticipate being dependent on any particular
customer, however, at this time we cannot know if any one customer will account
for more than 1% of our anticipated safety syringe sales.




7.
Patents, Trademarks, Licenses, Royalty Agreements or Labor
Contracts




4




In June
2007, we filed four utility patents focused on its MRI imaging software
technology. These patents were based on the provisional patents filed last June
and acquired in the Clear Image Acquisition transaction earlier this year. It is
believed that these patents will provide the basis for a family of MRI imaging
and search product offerings and also firms up its established intellectual
property. See “RISK FACTORS”.




Also in
September 2005 we filed a patent under the Joint Venture with Globe Med Tech,
and the Company owns 50% of this pending patent. The Company filed a lawsuit to
rescind, terminate and seek monetary damages for the non-fulfillment and breach
of the joint venture agreement and other related agreements, in addition to an
accounting of expenditures of funds under the terms and provisions of the
agreements. (see Item 3 - Legal Proceedings and “RISK FACTORS”). This patent was
published January 13, 2009.




RMCP 3CC
SAFETY SYRINGE PATENT. A U.S. patent covering our retractable safety syringe
design was published on January 28, 2005. This patent will expire on April 9,
2023. The Company has not yet filed any applications for foreign patent
protection. If any foreign patents applications are filed, there is no assurance
that any foreign patents will be issued. See “RISK FACTORS.”




RMCP
BLOOD SAMPLING DEVICE PATENT. A U.S. patent covering the Company's blood
sampling device was published on April 10, 2003. The Company does plan to devote
development resources towards this product in 2009. The Company has not filed
any applications for foreign patent protection. See “RISK FACTORS.” The time
limit for applying for a foreign patent on this device has expired.




PATENT
APPLICATIONS FOR COLOR AND 3D MRI SOFTWARE TECHNOLOGY. In June 2007, Clear Image
filed four patent applications related to the Color MRI technology, none of
which has yet been published. There is no assurance that any of the patent
applications will be published or that any patent protection for the Color MRI
technology can or will be obtained.




EMPLOYMENT
AGREEMENTS




Employment Agreement with
Ron 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 December 31, 2008, the Company owed Mr. Wheet $154,474 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 of all 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.




Amounts Accrued Pursuant To
Other Employment Agreements




As of
December 31, 2008, the Company has accrued $984,128 pursuant to other employment
agreements. 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 employment agreements has been initiated or threatened. There is no
assurance, however, that such litigation will not be initiated in the
future.




5


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, but at December 31, 2008 that
accrued interest had been reduced to $41,469 due to partial repayment as
discussed below. 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 the quarter ended
September 30, 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 value of $133,030 to partially repay this
debt.




8. Need
for Governmental Approval




Pursuant
to the Federal Food, Drug and Cosmetic Act, the FDA regulates the research,
design, testing, manufacture, safety, labeling, storage, record keeping,
advertising and promotion, distribution, and production of medical devices in
the United States. The Company's safety needle devices are considered to be
medical devices, are subject to FDA regulation, and must receive FDA approval
prior to sale in the United States.




Medical
devices are classified into one of three classes, depending on the controls
deemed by FDA to be necessary to reasonably ensure their safety and
effectiveness. Class I devices are subject to general controls (e.g. labeling,
pre-market notification and adherence to Quality System regulations, which have
replaced Good Manufacturing Practice regulations.) These devices are subject to
the lowest level of regulatory control. Class II devices are subject to general
controls and to special controls (e.g. performance standards, post-market
surveillance, patient registries, and FDA guidelines). Generally, Class III
devices are those that must receive pre-market approval by the FDA to ensure
their safety and effectiveness, and require clinical testing and FDA approval
prior to marketing and distribution. Class III devices are the most rigorously
regulated.




Generally,
before a new device can be introduced into the market in the United States, the
manufacturer must obtain FDA clearance through a 510(k) pre-market notification
or approval of a premarket approval (“PMA”) application. If a medical device
manufacturer can establish that a device is “substantially equivalent” to a
legally marketed Class I, Class II device, or a Class III device for which FDA
has not called for PMAs, the manufacturer may seek clearance from FDA to market
the device by filing a 510(k) pre-market notification. The 510(k) pre-market
notification will need to be supported by appropriate data establishing the
claim of substantial equivalence to the satisfaction of the FDA.




If the
Company or its collaborative partners cannot establish that the Company's safety
needle devices are substantially equivalent to legally marketed predicate
devices, pre-market approval of the device through submission of a PMA
application must be obtained. A PMA application must be supported by valid
scientific evidence, including pre-clinical and clinical trial data, as well as
extensive literature to demonstrate a reasonable assurance of the safety and
effectiveness of the device. The PMA represents the most rigorous form of FDA
regulatory approval.




The
Medical Device User Fee and Modernization Act, enacted in 2002, authorizes the
FDA to assess and collect review fees for Section 510(k) pre-market
notifications and pre-market approval applications filed on or after October 1,
2002. Fees for fiscal year 2007 for small businesses (companies with less than
$100 million in sales) range from $3,326 for Section 510(k) pre-market
notifications to $107,008 for PMAs, although fee reductions and waivers are
available for companies qualifying as small businesses.




6




There is
no assurance that any of our other planned products will qualify for the 510(k)
pre-market notification approval process or that the Company will have the funds
necessary to seek FDA approval. There is no assurance that any of our other
planned products will obtain FDA approval.




If FDA
approval is received, however, then the Company and/or its collaborative partner
(depending on who is manufacturing and marketing) would also be required to
comply with FDA post-market reporting requirements, including the submission of
reports on certain adverse events and malfunctions, and requirements governing
the promotion of medical devices. In addition, modifications to our devices may
require the filing of new 510(k) submissions or pre-market approval supplements,
and we will need to comply with FDA regulations governing medical device
manufacturing practices. The FDA requires medical device manufacturers to
register as such and subjects them to periodic FDA inspections of their
manufacturing facilities. The FDA requires that medical device manufacturers
produce devices in accordance with the FDA's current Quality System Regulation
(QSR), which governs the methods, facilities and controls used for the design,
manufacture, testing, packaging, labeling and storage of medical
devices.




There is
a different set of regulatory requirements in place for the European Union (EU).
In the EU the company putting a medical device onto the market must comply with
the requirements of the Medical Devices Directive (MDD) and affix the CE mark to
the product to attest to such compliance. To achieve this, the medical devices
in question must meet the “essential requirements” defined under the MDD
relating to safety and performance, and the relevant company must successfully
undergo a verification of its regulatory compliance by a third party standards
certification provider, known as “Notified Body.” The nature of the assessment
will depend on the regulatory class of products concerned, which in turn
determines the precise form of testing to be undertaken by the Notified
Body.




The
requirements of the MDD must be complied with by the “manufacturer of the
device,” which is defined as the party responsible for the design, manufacture,
packaging and labeling of the device before it is placed on the EU market,
regardless of whether these operations are carried out by this entity or on its
behalf.




Accordingly,
where medical devices are marketed by our potential licensees or by
collaborative partners under their names, compliance with the MDD will be their
responsibility. In the event that we decide to manufacture devices to be
distributed in the EU market under our name, all compliance responsibilities
will be borne by us.




There may
be numerous other approvals needed before our products can be sold in countries
other than the United States or the European Union. There is no assurance that
the Company or its collaborative partners, if any, will be successful in
obtaining such approvals.




9. Effect
of Existing or Probable Governmental Regulation




Regulatory
actions at the federal and state level promote the use of safety needles to
reduce the risk of accidental needlesticks. On July 1, 1999, California, through
its state Occupational Safety and Health Administration (OSHA) program, began
requiring the use of safety needles. Other states such as Texas, Tennessee,
Maryland and New Jersey have passed similar legislation.




On
November 6, 2000, President Clinton signed the Needlestick Safety and Prevention
Act amending OSHA's Bloodborne Pathogens Standard to require that employers
implement the use of safer medical devices in their facilities. To implement the
statutory mandates in the Needlestick Safety and Prevention Act, OSHA has issued
a number of further revisions to its Bloodborne Pathogens Standard. The revised
standard became effective on April 18, 2001. The new standard provisions impose
several needle device safety requirements on employers, including:




-
evaluation and implementation of safer needle devices as part of the
re-evaluation of appropriate engineering controls during an employer's annual
review of its exposure control plan;




-
documentation of the involvement of non-managerial, frontline employees in
choosing safer needle devices; and




-
establishment and maintenance of a sharps injury log for recording injuries from
contaminated sharps.




7




On
November 27, 2001, OSHA issued a compliance directive (CPL 2-2.69) that advises
OSHA's regional offices on the proper interpretation and enforcement of the
revised Bloodborne Pathogens Standard provisions. The compliance directive
confirms that the consideration of safer needle devices, in annually reviewing
and updating the exposure control plan, is a critical element of the Bloodborne
Pathogens Standard. The directive also stresses that the standard requires
employers to use engineering controls (e.g., safer needle devices) if such
controls will remove or eliminate the hazards to employees. As a result of these
regulatory actions, we anticipate that the demand for safety medical devices
such as those we have designed will continue to increase for the foreseeable
future.




10.
Estimate of the Amount Spent on Research and Development




R&D
expenses for our retractable safety syringe design were $246,040 and $0 in 2008
and 2007, respectively.




11. Costs
and effects of environmental compliance




The
Company has not spent any sums on environmental compliance and does not expect
to be required to spend any sums on environmental compliance in the future,
unless the Company chooses to become a manufacturer of its own products, which
is not likely. Should the Company be successful in establishing collaborative
arrangements with an established manufacturer, all environmental costs would be
borne by the manufacturer.




12.
Number of total employees and number of full time employees




We
presently have no full-time employees. Services such as product design and
development, accounting and financial reporting are provided by third parties on
a contract basis. Consequently, developing our business may require a greater
period of time than if we had full time employees. See “RISK
FACTORS.”




RISK
FACTORS




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 HAVE OTHER
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 RAISE
CAPITAL, WE MAY BE REQUIRED TO LIMIT OR CEASE OUR OPERATIONS, OR OTHERWISE
MODIFY OUR BUSINESS STRATEGY.




As of
December 31, 2008, 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.




8





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'srisks 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.




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 FUTURE PLANNED PRODUCTS THEN OUR FUTURE
PROSPECTS WILL BE HARMED.




Our
future planned products will require FDA approval before they can be sold in the
United States. There are some planned products for which we have not yet applied
for or received FDA approval. However we have received FDA approval on our Rec
Vac Safety Syringe. Our Rev Color and 3D MRI software technology does not
require FDA approval for educational and research purposes. We will begin to
market these two products for only educational and research purposes very soon.
There is no assurance that our other planned products will qualify for the FDA's
510(k) pre-market notification approval process, which is less rigorous than a
PMA.




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. Fees for fiscal year 2007 for small businesses (companies with
less than $100 million in sales) range from $3,326 for Section 510(k) pre-market
notifications to $107,008 for PMAs, although fee reductions and waivers are
available for companies qualifying as small businesses. There is no assurance
that we will qualify for fee reductions or waivers or that we will have the
funds necessary to apply for or obtain FDA approval for our 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 MARKET
SUCCESSFULLY, 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.




9




IF
WE ARE NOT ABLE TO ENTER INTO MANUFACTURING ARRANGEMENTS FOR OUR PLANNED
PRODUCTS 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.




IF
WE ARE UNABLE TO PROTECT OUR FUTURE PLANNED PRODUCTS, OR TO AVOID INFRINGING ON
THE RIGHTS OF OTHERS, OUR ABILITY TO COMPETE WILL BE IMPAIRED.




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.
However, we do have U.S. patent protection for the Rec Vac Safety Syringe. We do
not have foreign patent protection for some of our planned products. However, in
December 2008, we commenced our application for foreign patent protection for
our Rev Color and 3D MRI software technology. There is no assurance that we will
have the financial resources to apply for other 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.




10




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.




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 future
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.




11




WE
ARE VULNERABLE TO SUPERIOR COMPETING PRODUCTS OR NEW TECHNOLOGIES THAT COULD
MAKE OUR RETRACTABLE SAFETY NEEDLE DEVICES OBSOLETE




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.




YOUR
OWNERSHIP INTEREST MAY BE DILUTED AND THE VALUE OF THE SHARES OF OUR COMMON
STOCK MAY DECLINE BY THE EXERCISE OF STOCK OPTIONS WE HAVE GRANTED OR MAY GRANT
IN THE FUTURE AND BY THE COMMON STOCK WE HAVE ISSUED OR WILL ISSUE IN THE
FUTURE.




As of
March 17, 2009, we had a total of 10,360,000 options outstanding, which
consisted of options to purchase up to 110,000 shares of common stock at
exercise prices ranging from $1.00 to $10.00 per share (of which all were
exercisable). 10,250,000 of the options were granted during 2008 and 2007 at a
weighted average price of $0.10 per share and are considered to be “in the
money” at March 17, 2009. (the exercise price is less than the market price of
our common stock). The remaining 110,000 options outstanding are presently “out
of the money”. We may decide, however, to modify the terms and/or exercise price
of these “out of the money” options. 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. $10,250,000 of the options
outstanding as of March 17, 2009 were granted to officers or
directors.




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. During 2008, the Company
issued 1,419,704 shares for services. 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 17, 2009, we had 250,000,000 shares authorized and 29,831,813 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 DIRECTOR COULD
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, OUR BUSINESS MAY TAKE
LONGER TO DEVELOP, WHICH COULD ADVERSELY AFFECT OUR FUTURE
PROSPECTS.




We have
had limited experience in the medical device industry. Consequently, our
business may take longer to develop, which could adversely affect our future
prospects.









12




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




OUR
PLANNED PRODUCTS, IF SUCCESSFULLY COMMERCIALIZED, COULD BE EXPOSED TO
SIGNIFICANT PRODUCT LIABILITY CLAIMS WHICH COULD BE TIME CONSUMING AND COSTLY TO
DEFEND, DIVERT MANAGEMENT ATTENTION AND ADVERSELY IMPACT OUR ABILITY TO OBTAIN
AND 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 or
to 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 PRODUCTS COULD 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 CAN CHARGE 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 OUR PLANNED
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.




13





OUR
LIMITED OPERATING HISTORY MAKES EVALUATING OUR STOCK MORE DIFFICULT




Since
inception in 1986, 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.




WE
HAVE A HISTORY OF LOSSES AND EXPECT FUTURE LOSSES




We have
had annual losses since our inception in 1986. We expect to continue to incur
losses until we can sell enough products at prices high enough to generate a
profit. As of December 31, 2008, we had accumulated a deficit of $(20,537,717).
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 DECLINE IN
VALUE, RESULTING IN SUBSTANTIAL LOSSES TO YOU




The
market price of our common stock, which is over the counter (OTCBB:RMCP), has
been, and may continue to be, highly volatile. Our stock began trading over the
counter bulletin board on May 1, 20089. 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 CONTROLS OVER
FINANCIAL REPORTING ARE ADEQUATE, SUCH CONTROLS ARE SUBJECT TO INHERENT
LIMITATIONS.




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.




14




MR.
WHEET, OUR CEO AND A DIRECTOR, HAS VOTING CONTROL OF THE COMPANY AND CAN
UNILATERALLY MAKE BUSINESS DECISIONS FOR US. ALTHOUGH WE HAVE TWO OUTSIDE
DIRECTORS, THERE ARE NO PROCEDURES IN PLACE TO RESOLVE POTENTIAL CONFLICTS AND
TO EVALUATE RELATED PARTY TRANSACTIONS THAT ARE TYPICALLY REVIEWED BY
INDEPENDENT DIRECTORS.




Because
Mr. Wheet owns 1,000,000 Series 2007 Preferred shares, which gives him the right
to vote 125 shares to one 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
2. DESCRIPTION OF PROPERTY




None




ITEM
3. LEGAL PROCEEDINGS.




On
November 3, 2005, the Company 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. In connection with the agreement,
the Company 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 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 the
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 for fraud and contempt of court for Globe Med Tech and the CFO
individually. A hearing is currently set for May 1, 2009.




ITEM
4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS






15




PART
II




ITEM
5. MARKET PRICE AND DIVIDENDS ON THE REGISTRANT'S COMMON EQUITY




(a)
Market Information




Our
common stock is traded over the counter under the trading symbol “RMCP”. The
high and low prices for our common stock during the calendar quarters ended
were:




Quarter
      ended
            
            High
            
            
            LowDecember 31,
      2008
            
            $
            0.480
            
            
            $
            0.140September 30,
      2008
            
            $
            0.570
            
            
            $
            0.260June 30,
      2008
            
            $
            0.590
            
            
            $
            0.120March 31,
      2008
            
            $
            0.205
            
            
            $
            0.069December 31,
      2007
            
            $
            0.300
            
            
            $
            0.060September 30,
      2007
            
            $
            0.650
            
            
            $
            0.260June 30,
      2007
            
            $
            1.000
            
            
            $
            0.410


Quotations
on the OTC bulletin board reflect bid and ask quotations, may reflect
inter-dealer prices, without retail markup, markdown or commission, and may not
represent actual transactions.




(b)
Holders




As of
March 17, 2009, we estimate that there were approximately 640 holders of record
of our common stock. This figure does not take into account those shareholders
whose certificates are held in the name of broker-dealers or other
nominees.




(c)
Dividends




We have
not declared any dividends in the past, and we do not plan to declare dividends
in the future.




ITEM
6. PLAN OF OPERATION




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 “RISK
FACTORS” 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.




1. Plan
of Operation for the Next Twelve Months





(i) Cash
Requirements





LIQUIDITY,
CAPITAL RESOURCES AND CASH REQUIREMENTS





Results
of operations





For the
year ended December 31, 2008 compared to December 31, 2007





During
the years ended December 31, 2008 and 2007, the Company had no revenues and
continued to focus on obtaining government approval for its medical
devices.  Related to this process, in 2008 the Company incurred
approximately $831,000 in general and administrative expenses compared to
$847,000 in 2007.  These expenses primarily relate to legal fees
associated with obtaining FDA approval and expenses associated with refining our
current products to a production level quality.  We utilize third
parties for this process.  We also incurred approximately $246,000 and
$166,000 in 2008 and 2007 respectively in research and development costs to
continue to research enhancements to our products.  During 2007, the
Company acquired research and development activities of Clear Image, Inc and
expensed $3,309,515 related to the research and development activities that were
determined to not have viable alternate uses.






16




In order
to fund the governmental approval process, we issue stock options and/or common
stock when it is acceptable to the third party for services rendered in
assisting us in the approval process.   Compensation cost related
to the issuance of stock options to outside parties for services rendered in
2008 and 2007 were approximately $259,000 and $155,000
respectively.  We also sell stock as needed for cash to be used in our
operations.  In 2008 and 2007, respectively, we receive proceeds from
exercise of stock options or sale of stock of approximately $698,000 and
$475,000.  As of December 31, 2008, 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 26,883,195 shares were issued and outstanding as of March 17, 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.




If the
Company raises the necessary funds, the Company plans to complete the
development and beta testing of the Color MRI software.




(iii)
Expected Purchase or Sale of Plant and Significant Equipment.




None.




(iv)
Expected Significant Changes in the Number of Employees




None.




17




ITEM
7. FINANCIAL STATEMENTS




See
Part F/S




ITEM
8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE




None




ITEM
8A. 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 officer, or persons
performing similar functions, as appropriate to allow timely decisions regarding
required disclosure.




MANAGEMENT'S
ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING Management is
responsible for establishing and maintaining adequate internal control over
financial reporting, as such term is defined in the Exchange Act Rules
13a-15(f). A system of internal control over financial reporting is a process
designed to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes in
accordance with generally accepted accounting principles.




Under the
supervision and with the participation of management, including the principal
executive officer and the principal financial officer, the Company's management
has evaluated the effectiveness of its internal control over financial reporting
as of December 31, 2008, based on the criteria established in a report entitled
“Internal Control - Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission” and the interpretive guidance issued
by the Commission in Release No. 34-55929. Based on this evaluation, the
Company's management has evaluated and concluded that the Company's internal
control over financial reporting was ineffective as of December 31, 2008 and
identified the following material weaknesses:




o There
is a lack of accounting personnel with the requisite knowledge of Generally
Accepted Accounting Principles in the US (“GAAP”) and the financial reporting
requirements of the Securities and Exchange Commission.




o There
are 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.




o There
is 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
Company will continue its assessment on a quarterly basis and as soon as we
start operations we plan to hire personnel and resources to address these
material weaknesses. We believe these issues can be solved with hiring in-house
accounting support and plan to do so as soon as we have funds available for
this.   There has been no change in its internal control over
financial reporting that occurred during the Company's most recent fiscal
quarter that has materially affected, or is reasonably likely to materially
affect, the Company's internal control over financial reporting.




This
annual report does not include an attestation report of the Company's
independent registered public accounting firm regarding internal control over
financial reporting. The Company's registered public accounting firm was not
required to issue an attestation on its internal controls over financial
reporting pursuant to temporary rules of the Securities and Exchange
Commission.




The
Company will continue to evaluate the effectiveness of internal controls and
procedures on an on-going basis.




18




PART
III




ITEM
9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH
SECTION 16(a) OF THE EXCHANGE ACT




(a)
Identity of Directors and Executive Officers




Rondald
Wheet, age 43, is Chairman, CEO and a Director of RMCP and has served in such
capacity since March 16, 2005.




Thomas M.
Beahm, MD, FACS, age 58, is a practicing plastic surgeon, who lives in
Chattanooga, Tennessee. He is an active member of the American Society of
Plastic Surgeons, American College of Surgeons, and American Medical
Association, and simultaneously owns and runs his own practice. In addition, he
is Secretary of Integrated Voice Systems, which has software in over 130
hospitals, and is also serving on the board of Clear Image, Inc., a privately
held company specializing in proprietary MRI Software and Hardware. Dr. Beahm
also has experience directing plastic surgery mission work in various third
world countries, coming to the aid of thousands of people in Asia, Africa, and
South America. He has served as a director of the Company since October,
2007.




Thomas
O'Brien, age 61, is acting President and CEO of Clear Image, Inc. (MRI
Software/Hardware), and has more than twenty (20) years of general management
experience in the medical device industry. His background includes domestic and
international sales, marketing and distribution of high technology medical
systems and services. He is fluent in Mandarin, and served at the National
Security Agency, holding a Top Secret Crypto Clearance as a Chinese linguist.
Mr. O'Brien has held executive positions with medical industry leaders such as
Pfizer, Toshiba, and Johnson and Johnson's subsidiary the Technicare
Corporation. He has served as a director of the Company since October,
2007.




(b) Other
Directorships.




Mr. Wheet
and Mr. O'Brien were previously directors of Clear Image, Inc., a private
company that was acquired by the Company on January 30, 2007.




(c)
Family Relationships




None.




(d)
Involvement in Legal Proceedings of Officers, Directors, and Control
Persons




None.




ITEM
10. EXECUTIVE COMPENSATION




SUMMARY
COMPENSATION TABLE




Long
      Term CompensationAnnual
      Compensation
            
            
            Awards
            
            
            PayoutsName
      and Principal
              Position
            
            Year
            
            Salary
            
            
            Bonus
            
            
            OtherAnnual
      Compensation
            
            
            Restricted
      Stock Awards
            
            
            Securities
      Underlying Options /SARs
            
            
            LTIP Payouts
            
            
            All
      Other CompensationRonWheet,CEO
            
            2007
            
            $
            150,000
            (1)
            
            $
            -0-
            
            
            $
            -0-
            
            
            
            
            
            
            $
            142,000
            (2)
            
            $
            -0-
            
            
            $
            -0-RonWheet,CEO
            
            2008
            
            $
            206,250
            (3)
            
            $
            -0-
            
            
            $
            -0-
            
            
            
            
            
            
            $
            -
            
            
            $
            -0-
            
            
            $
            -0-




19




(1)
Represents Mr. Wheet's accrued salary for 2007, pursuant to his employment
agreement. As of December 31, 2007, $211,024 of Mr. Wheet's accrued salary from
2007 and prior remained unpaid. $64,000 remained upaid related to 2007 and
$147,024 remained unpaid related to 2006.


(2)
Represents the fair market value as of March 15, 2007 of the 8,000,000 stock
options issued to Mr. Wheet during 2007.


(3)
Represents Mr. Wheet's accrued salary for 2008, pursuant to his employment
agreement. As of December 31, 2008, approximately $154,000 of Mr. Wheet's
accrued salary from 2007 and prior remained unpaid. $64,000 remained upaid
related to 2007 and $90,474 remained unpaid related to 2006.




Aggregated Option/SAR
Exercises in Last Fiscal Year and FY-End Option/SAR Values




Name
            
            Shares
              Acquired
              on
      Exercise
            
            Value
      Realized
            
            Number
      of Securities Value of
      Underlying Unexercised  Options/SARs
              at
      FY-End Exercisable/ Unexercisable
            
            Unexercised
      In-the-Money Options/SARs at FY-End
    Exercisable/UnexercisableRon Wheet,
      CEO
            
            N/A
            
            N/A
            
            7,000,000(1)
            
            .08 exercise
      price




(1) Mr.
Wheet exercised 1,000,000 of these options in January 2009.




ITEM
11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT




The
following shareholders are known to us to own more than 5% of the outstanding
common stock of the Company. Except as otherwise indicated, all information is
as of March 17, 2009 and ownership consists of sole voting and investment
power.




Name
      and Address
            
            Beneficial
              Relationship
      toCompany
            
            Outstanding
              Common
      Stock
            
            Percentage
      of
              OwnershipCommon
      StockRondald L.
      Wheet 2073 Shell Ring Circle Mt. Pleasant, SC 29466
            
            CEO and
      Director
            
            3,312,000
            
            11.10%*Dr. Thomas
      Beahm
            
            Director
            
            2,298,349
            
            7.70%Thomas
      O'Brien
            
            Director
            
            1,784,349
            
            5.98%




Officer
and Directors As a Group (3 persons) 7,394,698 24.79%




* Does
not include the 1,000,000 shares of Series 2007 Preferred Stock, described
below.




Preferred
Stock




The
Company has 5,000,000 shares of Preferred Stock ($0.001 par value) authorized.
On October 24, 2006, the Company designated 1,000,000 shares as Series 2007
Preferred Stock, which were then issued to Mr. Wheet, the Company's CEO. Each
Series 2006 Preferred is convertible, at any time at the discretion of Mr.
Wheet, into one share of the Company's common stock for each share of Series
2006 Preferred. Each Series 2006 Preferred has voting rights of 125 votes per
share of Series 2006 Preferred voting together as one class with the Company's
common stock. As a result, Mr. Wheet has effective voting control of the
Company's common stock and as such can unilaterally decide on business matters.
Upon conversion of the Series 2006 Preferred, each share of common stock
resulting from the conversion shall be entitled to one vote per share-not 125
votes per share.




Common Stock Options and
Warrants Outstanding




As of
March 17, 2009, we had a total of 10,360,000 options outstanding, which
consisted of options to purchase up to 110,000 shares of common stock at
exercise prices ranging from $1.00 to $10.00 per share (of which all were
exercisable). $10,250,000 of the options were granted during 2007 and 2008 at a
weighted average price of $0.10 per share and are considered to be “in the
money” at March 17, 2009. (the exercise price is less than the market price of our
common stock). The remaining 110,000 options outstanding are presently “out of
the money”. We may decide, however, to modify the terms and/or exercise price of
these “out of the money” options. 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. $10,250,000 the options outstanding
as of March 17, 2009 were granted to officers or directors.




20




ITEM
12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS




On
October 24, 2006, the Company issued 1,000,000 shares of its Series 2006
Preferred Stock to Mr. Wheet. The Series 2006 Preferred Stock gives Mr. Wheet
the right to vote 125,000,000 shares together with the common stock as a class.
Accordingly Mr. Wheet will have the right to vote a total of 83% of all the
Company's shares entitled to vote on any matter presented to the Company's
stockholders. A Form 8-K regarding the issuance of the Series 2007 Preferred
Stock to Mr. Wheet was filed with the SEC on November 1, 2006.




In 2007,
in connection with the acquisition of Clear Image, Inc., Mr. Wheet received
2,286,000 shares of restricted common stock, Dr. Beahm received 1,599,125 shares
of restricted common stock, and Mr. O'Brien received 1,645,625 shares of
restricted common stock. Mr. Wheet and Mr. O'Brien were directors and
shareholders and Dr. Beahm was a shareholder of Clear Image, Inc. prior to its
acquisition by the Company.




In 2007,
each director was granted 2,000,000 options (a total of 6,000,000) to purchase
common stock at $0.08 per share and we executed a new employment agreement with
Mr. Wheet which included granting 5,000,000 options at $.08, both granted
pursuant to Stock Option Plan, previously registered on Form S-8.




ITEM
13. EXHIBITS AND REPORTS ON FORM 8-K




Exhibits:




See
“Index to and Description of Exhibits”




Reports
on Form 8-K




ITEM
14. PRINCIPAL ACCOUNTANT FEES AND SERVICES




Audit
Fees




Audit
Fees consist of assurance and related services that are reasonably related to
the performance of the audit or review of our financial statements. This
category includes fees related to the performance of audits and attest services
not required by statute or regulations, and accounts consultations regarding the
application of GAAP to proposed transactions. The aggregate Audit Fees billed
for the fiscal years ended December 31, 2008 and 2007 were $13,629 and $9,212
respectively.




Audit
Related Fees




The
aggregate fees billed for assurance and related services by our principal
accountant that are reasonably related to the performance of the audit or review
of our financial statements, other than those previously reported in this Item
14, for the fiscal years ended December 31, 2008 and 2007 were $-0- and
$-0-.




Tax
Fees




Tax Fees
consist of the aggregate fees billed for professional services rendered by our
principal accounts for tax compliance, tax advice, and tax planning. These
services include preparation for federal and state income tax returns. The
aggregate Tax Fees billed for the fiscal years ended December 31, 2008 and 2007
were $0 and $830, respectively.




Audit
Committee




The
Company's Board of Directors functions as its audit committee. It is the policy
of the Company for all work performed by our principal accountant to be approved
in advance by the Board of Directors. All of the services described above in
this Item 14 were approved in advance by our Board of Directors.




21




PART
F/S




INDEX
TO FINANCIAL STATEMENTS




AUDITED FINANCIAL
STATEMENTS




Independent
      Registered Public Accounting Firm
            23Balance Sheets At
      December 31, 2008 and 2007
            24Statements
      Of Operations From Inception (August 16, 1996)Through
      December 31, 2008 And For The Years EndedDecember
      31, 2008 and 2007
            25Statements
      Of Cash Flows From Inception (August 16, 1996)Through
      December 31, 2008 And For The Years EndedDecember
      31, 2008 and 2007
            26Statements
      Of Shareholders' Equity From Inception(August
      16, 1996) Through December 31, 2008
            27Notes to Financial
      Statements
            32




22




REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM




To the
Shareholders of




Revolutions
Medical Corporation (formerly Maxxon, Inc.) Tulsa, Oklahoma




We have
audited the accompanying consolidated balance sheets of Revolutions Medical
Corporation (formerly Maxxon, Inc.) (a development stage company) for the years
ended December 31, 2008 and 2007, and the related statements of operations,
shareholders' equity, and cash flows for the years ended December 31, 2008 end
2007 and for the period from December 16, 1996 (inception) to December 31, 2008.
These financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on these consolidated financial
statements based on our audit.




We
conducted our audit in accordance with auditing standards of the Public Company
Oversight Board (United States). Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.


In our
opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of Revolutions Medical Corporation as
of December 31, 2008, and the results of its operations and its cash flows for
the years ended December 31, 2008 and 2007 and for the period from December 16,
1996 (inception) to December 31, 2008 in conformity with accounting principles
generally accepted in the United States of America.




The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern. As discussed in Note 2 to the financial
statements, the Company has suffered recurring losses from operations and has a
net capital deficiency, which raises substantial doubt about its ability to
continue as a going concern. Management's plans regarding those matters also are
described in Note 2. The financial statements do not include any adjustments
that might result from the outcome of this uncertainty.








/s/ Sutton Robinson
      Freeman & Co., P. CSutton Robinson
      Freeman & Co., P. C.Certified Public
      AccountantsMarch 30,
    2009Tulsa,
      Oklahoma




23




REVOLUTIONS
MEDICAL CORPORATION (FORMERLY MAXXON, INC.)
 (A
Development Stage Company)
 
 BALANCE
SHEET
 December
31, 2008 and 2007
  December
      31, 2008
              
              
              December
      31, 2007ASSETSCURRENT
    ASSETSCash
              
              $
              4,796
              
              
              $
              2,398Goodwill
              
              
              23,276
              
              
              
              23,276TOTAL
      ASSETS
              
              $
              28,072
              
              
              $
              25,674LIABILITIES AND
      SHAREHOLDERS' EQUITYCURRENT
      LIABILITIESAccounts payable and
      accrued liabilities
              
              $
              466,683
              
              
              $
              284,286Accrued
      Salaries
              
              
              1,158,103
              
              
              
              1,214,563Notes Payable and
      Accrued Interest
              
              
              143,429
              
              
              
              295,097Total
      current liabilities
              
              
              1,768,215
              
              
              
              1,794,036Total
      liabilities
              
              
              1,768,215
              
              
              
              1,794,036Minority
      Interest
              
              
              --
              
              
              
              (122,750
              )SHAREHOLDERS'
      DEFICIENCYPreferred stock,
      $0.001 par value,5,000,000
      shares authorized; 1,000,000 sharesissued
      and outstanding
              
              
              1,000
              
              
              
              1,000Common stock, $0.001
      par value,250,000,000 shares
      authorized; 26,883,195 and18,127,422 shares
      issued and outstanding atDecember
      31, 2008 and 2007, respectively
              
              
              26,883
              
              
              
              18,127Paid in
      capital
              
              
              18,769,691
              
              
              
              17,537,824Deficit accumulated
      during the development stage
              
              
              (20,537,717
              )
              
              
              (19,202,563
              )Total
      shareholders' deficiency
              
              
              (1,740,143
              )
              
              
              (1,645,612
              )TOTAL LIABILITIES
      AND SHAREHOLDERS' DEFICIENCY
              
              $
              28,072
              
              
              $
              25,674
    24


REVOLUTIONS
MEDICAL CORPORATION (FORMERLY MAXXON, INC.)
 (A
Development Stage Company)
 
 STATEMENTS
OF OPERATIONS
 From
Inception (August 16, 1996) Through December 31, 2008 and
 For
The Years Ended December 31, 2008 and 2007
   FROM
      INCEPTION
                (AUGUST
      16, 1996) THROUGHDECEMBER 31, 2008
              
              
              YEAR
      ENDEDDECEMBER 31, 2008
              
              
              YEAR
      ENDEDDECEMBER 31, 2007Investment
      Income
              
              $
              170,753
              
              
              $
              --
              
              
              $
              --Other
      Income
              
              
              3,857
              
              
              
              --
              
              
              
              --174,610
              
              
              
              --
              
              
              
              --EXPENSESResearch and
      development
              
              
              2,283,056
              
              
              
              246,040
              
              
              
              166,030Purchased R&D- Clear ImageTransaction (See
      Note 3)
              
              
              3,309,515
              
              
              
              --
              
              
              
              3,309,515General and
      administrative
              
              
              14,567,764
              
              
              
              831,528
              
              
              
              847,166Total operating expenses
              
              
              20,160,335
              
              
              
              1,077,568
              
              
              
              4,322,711Operating
      loss
              
              
              (19,985,725
              )
              
              
              (1,077,568
              )
              
              
              (4,322,711
              )Interest
      income
              
              
              17,276
              
              
              
              --
              
              
              
              --Interest
      expense
              
              
              122,297
              
              
              
              --
              
              
              
              37,663Gain on disposal of
      assets
              
              
              794
              
              
              
              --
              
              
              
              --Gain on
      extinguishment of debt
              
              
              10,398
              
              
              
              10,398
              
              
              
              --Depreciation and
      amortization
              
              
              75,536
              
              
              
              --
              
              
              
              --Compensation cost
      for options
              
              
              566,049
              
              
              
              342,801
              
              
              
              223,248Net loss before
      minority interest
              
              
              (20,721,139
              )
              
              
              (1,409,971
              )
              
              
              (4,583,622
              )Minority Interest in
      Subsidiary Loss
              
              
              (183,422
              )
              
              
              (74,817
              )
              
              
              (108,605
              )Net loss from
      operations
              
              $
              (20,537,717
              )
              
              $
              (1,335,154
              )
              
              $
              (4,475,017
              )Weighted
      average sharesoutstanding
              
              
              37,187,111
              
              
              
              14,541,824
              
              
              
              17,597,226Net loss per
      share (Note 1)
              
              $
              (0.55
              )
              
              $
              (0.09
              )
              
              $
              (0.25
              )


25




REVOLUTIONS MEDICAL CORPORATION (FORMERLY MAXXON,
INC.)
 (A
Development Stage Company)
  STATEMENTS
OF CASH FLOWS
 From
Inception (August 16, 1996) Through December 31, 2008 and
 For
The Years Ended December 31, 2008 and 2007
 FROM
      INCEPTION
                  (AUGUST 16,1996)
      THROUGH
                  DECEMBER 31, 2008
                
                
                YEARS
      ENDEDDECEMBER 31, 2008
                
                
                DECEMBER 31, 2007OPERATING
      ACTIVITIESNet
      loss
                
                $
                (20,537,717
                )
                
                $
                (1,335,154
                )
                
                $
                (4,475,017
                )Plus non-cash
      charges to earnings:Stock compensation
      expense
                
                
                566,049
                
                
                
                342,801
                
                
                
                223,248Depreciation and
      amortization
                
                
                75,525
                
                
                
                -
                
                
                
                -Purchase R&D -
      Clear Image
                
                
                3,309,514
                
                
                
                --
                
                
                
                3,309,514Common stock issued
      for services
                
                
                3,617,328
                
                
                
                259,920
                
                
                
                -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 forwith non-cash
      consideration
                
                
                167,500
                
                
                
                -
                
                
                
                -Compensation cost
      for option price
    reduction
                
                
                50,000
                
                
                
                -
                
                
                
                -Amortization of
      compensation cost for optionsgranted to
      non-employees and common stockissued for
      services
                
                
                1,775,577
                
                
                
                -
                
                
                
                -Allowance for
      doubtful accounts
                
                
                50,900
                
                
                
                -
                
                
                
                -Gain on
      extinguishment of debt
                
                
                (10,398
                )
                
                
                (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 warrantsgranted to
      non-employees
                
                
                1,205,015
                
                
                
                -
                
                
                
                -Change in working
      capital accounts:(Increase) decrease
      in receivables from related
      parties
                
                
                (68,900
                )
                
                
                -
                
                
                
                -(Increase) decrease
      in goodwill
                
                
                (23,276
                )
                
                
                -
                
                
                
                (23,276
                )(Increase) decrease
      in other receivables
                
                
                (176,577
                )
                
                
                -
                
                
                
                -Increase (decrease)
      in accrued salaries and consulting
                
                
                933,051
                
                
                
                (56,550
                )
                
                
                273,501Increase (decrease)
      in accrued interest
                
                
                91,177
                
                
                
                -
                
                
                
                37,664Increase (decrease)
      in accounts payable and accrued liabilities
                
                
                1,558,230
                
                
                
                182,395
                
                
                
                300,259Total operating
      activities
                
                
                (5,743,697
                )
                
                
                (625,225
                )
                
                
                (354,107
                )INVESTING
      ACTIVITIESPurchase 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
      ACTIVITIESLoans 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
                
                
                4,005,867
                
                
                
                304,823
                
                
                
                474,999From exercise of
      stock options
                
                
                1,322,417
                
                
                
                397,617
                
                
                
                -Less:  Issue
      Costs
                
                
                (102,318
                )
                
                
                -
                
                
                
                -Convertible
      debentures issued for cash
                
                
                355,000
                
                
                
                -
                
                
                
                -Payment of exclusive
      license note payable
                
                
                (100,000
                )
                
                
                -
                
                
                
                -Total financing
      activities
                
                
                6,285,099
                
                
                
                702,440
                
                
                
                474,999Minority
      interest
                
                
                (197,567
                )
                
                
                (74,817
                )
                
                
                (122,750
                )Change in
      cash
                
                
                4,796
                
                
                
                2,398
                
                
                
                (1,858
                )Cash at beginning of
      period
                
                
                -
                
                
                
                2,398
                
                
                
                4,256Cash at end of
      period
                
                $
                4,796
                
                
                $
                4,796
                
                
                $
                2,398Supplemental
      disclosure of cash flow information:Cash paid for
      interest and taxes during the
    period
                
                
                57,571
                
                
                
                -
                
                
                
                28,487Non-cash financing
      and investing activities:Investment in Globe
      Joint
      Venture
                
                
                (637,566
                )
                
                
                -
                
                
                
                -Common stock issued
      to founders
                
                
                7,000
                
                
                
                -
                
                
                
                -Common stock issued
      in connection with mergerwith Cerro Mining
      Corporation
                
                
                300
                
                
                
                -
                
                
                
                -20 to 1 reverse
      stock split
                
                
                138,188
                
                
                
                -
                
                
                
                138,188Common 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
                
                
                
                133,032
                
                
                
                6,914Common stock issued
      for convertible debentures
                
                
                190,660
                
                
                
                -
                
                
                
                -Common stock issued
      for services
                
                
                706,663
                
                
                
                -
                
                
                
                235,000Common stock issued
      to pay Ives debt
                
                
                27,000
                
                
                
                -
                
                
                
                -Common stock issued
      to Clear Image shareholders under short form
      merger
                
                
                12,208
                
                
                
                12,208
                
                
                
                -
    26




REVOLUTIONS
MEDICAL CORPORATION (FORMERLY MAXXON, INC.)
 (A
Development Stage Company)
  STATEMENTS
OF STOCKHOLDERS' EQUITY
 From
Inception (August 16, 1996) Through December 31, 2008
   Preferred
                  Shares
                
                
                Stock
                  Amount
                
                
                Common
                  Shares
                
                
                Stock
                  Amount
                
                
                Paid-In
                  Capital
                
                
                Deficit
                  Accumulated
                  during
      the
                  Development
                  Stage
                
                
                Subscription
                  Receivable
                
                
                TotalBalance at
      Inception(August
      16, 1996)
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -Cerro
      Mining/Maxxon-OK Merger:Cerro
      Mining
                
                
                -
                
                
                
                -
                
                
                
                531,000
                
                
                
                531
                
                
                
                (231
                )
                
                
                -
                
                
                
                -
                
                
                
                300Maxxon-OK:Shares issued to
      founders
                
                
                -
                
                
                
                -
                
                
                
                7,000,000
                
                
                
                7,000
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                7,000Shares
      soldfor cash
      to third-party investors
                
                
                -
                
                
                
                -
                
                
                
                578,000
                
                
                
                578
                
                
                
                573,899
                
                
                
                -
                
                
                
                -
                
                
                
                574,477Ives
      Transactions:Investment in
      IvesHealth
      Company
                
                
                -
                
                
                
                -
                
                
                
                311,240
                
                
                
                311
                
                
                
                310,951
                
                
                
                -
                
                
                
                -
                
                
                
                311,261Investment in
      TheHealth
      Club
                
                
                -
                
                
                
                -
                
                
                
                35,000
                
                
                
                35
                
                
                
                34,965
                
                
                
                -
                
                
                
                -
                
                
                
                35,000Conversion
    ofIves
      Debt
                
                
                -
                
                
                
                -
                
                
                
                18,513
                
                
                
                19
                
                
                
                26,981
                
                
                
                -
                
                
                
                -
                
                
                
                27,000Issuance of
      CommonStock for:Cash from
      third-party investors
                
                
                -
                
                
                
                -
                
                
                
                218,569
                
                
                
                219
                
                
                
                353,501
                
                
                
                -
                
                
                
                -
                
                
                
                353,720Cash from related
      partyPromissory
      Notes
                
                
                -
                
                
                
                -
                
                
                
                64,500
                
                
                
                65
                
                
                
                128,935
                
                
                
                -
                
                
                
                -
                
                
                
                129,000Subscriptions
      Receivable
                
                
                -
                
                
                
                -
                
                
                
                52,757
                
                
                
                53
                
                
                
                69,747
                
                
                
                -
                
                
                
                -
                
                
                
                (69,800
                )Services
      Rendered
                
                
                -
                
                
                
                -
                
                
                
                90,499
                
                
                
                90
                
                
                
                173,337
                
                
                
                -
                
                
                
                -
                
                
                
                173,427Debentures
      Converted
                
                
                -
                
                
                
                -
                
                
                
                102,673
                
                
                
                103
                
                
                
                74,897
                
                
                
                -
                
                
                
                -
                
                
                
                75,000Net Income (Loss)
      atDecember 31,
      1997
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                (795,376
                )
                
                
                -
                
                
                
                (795,376
                )Balance
      at December 31,1997
                
                
                -
                
                
                
                -
                
                
                
                9,002,751
                
                
                
                9,003
                
                
                
                1,746,982
                
                
                
                (795,376
                )
                
                
                (69,800
                )
                
                
                890,808Issuance of
      CommonStock for:Conversion of
      IvesDebt
                
                
                -
                
                
                
                -
                
                
                
                44,827
                
                
                
                45
                
                
                
                54,955
                
                
                
                -
                
                
                
                -
                
                
                
                55,000Cash from
      third-party
      investor
                
                
                -
                
                
                
                -
                
                
                
                50,000
                
                
                
                50
                
                
                
                90,950
                
                
                
                -
                
                
                
                -
                
                
                
                91,000Options exercised
      bythird-parties for
      cash
                
                
                -
                
                
                
                -
                
                
                
                545,867
                
                
                
                546
                
                
                
                359,354
                
                
                
                -
                
                
                
                -
                
                
                
                359,900Options exercised
      bythird-parties for
      services
                
                
                -
                
                
                
                -
                
                
                
                24,133
                
                
                
                24
                
                
                
                18,076
                
                
                
                -
                
                
                
                -
                
                
                
                18,100Services Rendered
      bythird-parties
                
                
                -
                
                
                
                -
                
                
                
                988,007
                
                
                
                988
                
                
                
                573,560
                
                
                
                -
                
                
                
                -
                
                
                
                574,549Debentures Converted
      bythird
      parties
                
                
                -
                
                
                
                -
                
                
                
                548,574
                
                
                
                549
                
                
                
                274,451
                
                
                
                -
                
                
                
                -
                
                
                
                275,000Settlement
      withrelated
      party
                
                
                -
                
                
                
                -
                
                
                
                350,000
                
                
                
                350
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                350Certificates
      canceled:
                
                
                -
                
                
                
                -
                
                
                
                (91,572
                )
                
                
                (92
                )
                
                
                (40,173
                )
                
                
                -
                
                
                
                -
                
                
                
                (40,265
                )Value of
      ServicesContributedby Officer and
      Employees
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                114,154
                
                
                
                
                
                
                
                -
                
                
                
                -
                
                
                
                114,154Compensation
      Costfor Stock Options
      GrantedTo
      Non-Employees
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                918,187
                
                
                
                -
                
                
                
                -
                
                
                
                918,187Cancellation
      ofSubscriptionsReceivable from
      related party
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                
                
                
                
                
                
                
                
                69,800
                
                
                
                69,800Net Income (Loss)
      atDecember 31,
      1998
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                (2,584,383
                )
                
                
                -
                
                
                
                (2,584,383
                )Balance at December
      31, 1998
                
                
                -
                
                
                
                -
                
                
                
                11,462,587
                
                
                
                11,463
                
                
                
                4,110,497
                
                
                
                (3,379,759
                )
                
                
                0
                
                
                
                742,201
  REVOLUTIONS
MEDICAL CORPORATION (FORMERLY MAXXON, INC.)
 (A
Development Stage Company)
  STATEMENTS
OF STOCKHOLDERS' EQUITY
 From
Inception (August 16, 1996) Through December 31, 2008
   Preferred
                Shares
              
              
              Stock
                Amount
              
              
              Common
                Shares
              
              
              Stock
                Amount
              
              
              Paid-In
                Capital
              
              
              Deficit
                Accumulated
      during the
                Development
                Stage
              
              
              Subscription
                Receivable
              
              
              TotalIssuance of
      CommonStock for:Cash from
      third-party investor
              
              
              -
              
              
              
              -
              
              
              
              390,693
              
              
              
              390
              
              
              
              342,034
              
              
              
              -
              
              
              
              -
              
              
              
              342,424Less: Issue
      Costs
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              (16,743
              )
              
              
              -
              
              
              
              -
              
              
              
              (16,743
              )Options exercised bythird-parties for
      cash
              
              
              -
              
              
              
              -
              
              
              
              300,000
              
              
              
              300
              
              
              
              149,700
              
              
              
              -
              
              
              
              -
              
              
              
              150,000Services Rendered
      bythird-parties
              
              
              -
              
              
              
              -
              
              
              
              164,069
              
              
              
              164
              
              
              
              166,579
              
              
              
              -
              
              
              
              -
              
              
              
              166,743Value of
      ServicesContributed by
      Officer and Employees
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              280,000
              
              
              
              -
              
              
              
              -
              
              
              
              280,000Compensation Cost
      for Stockoptions Granted to
      Non-Employees
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              89,728
              
              
              
              -
              
              
              
              -
              
              
              
              89,728Net Income
      (Loss)at
      December 31, 1999
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              (1,014,555
              )
              
              
              -
              
              
              
              -
              
              
              
              (4,014,555
              )Balance at December
      31, 1999
              
              
              -
              
              
              
              -
              
              
              
              12,317,349
              
              
              
              12,317
              
              
              
              5,121,795
              
              
              
              (4,394,314
              )
              
              
              0
              
              
              
              739,798Issuance of
      CommonStock for:Cash from
      third-party investor
              
              
              -
              
              
              
              -
              
              
              
              862,776
              
              
              
              863
              
              
              
              249,525
              
              
              
              -
              
              
              
              -
              
              
              
              250,388Less: Issue
      CostsValue of ServicesContributed by
      Officer and Employees
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              405,000
              
              
              
              -
              
              
              
              -
              
              
              
              405,000Net Income (Loss)
      atDecember 31,
      2000
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              
              
              
              
              (1,347,859
              )
              
              
              -
              
              
              
              (1,347,859
              )Balance
      at December31,
      2000
              
              
              -
              
              
              
              -
              
              
              
              13,180,125
              
              
              
              13,180
              
              
              
              5,776,320
              
              
              
              (5,742,173
              )
              
              
              0
              
              
              
              47,327Issuance of
      CommonStock for:Cash from
      third-party investor
              
              
              -
              
              
              
              -
              
              
              
              6,558,333
              
              
              
              6,558
              
              
              
              1,598,142
              
              
              
              -
              
              
              
              -
              
              
              
              1,604,700Purchased by
      Employees
              
              
              -
              
              
              
              -
              
              
              
              3,650,000
              
              
              
              3,650
              
              
              
              543,850
              
              
              
              -
              
              
              
              (547,500
              )
              
              
              -Issued for
      Repayment of Debt
              
              
              -
              
              
              
              -
              
              
              
              50,000
              
              
              
              50
              
              
              
              7,450
              
              
              
              -
              
              
              
              -
              
              
              
              7,500Less: Issue
      Costs
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              (85,575
              )
              
              
              -
              
              
              
              -
              
              
              
              (85,575
              )Services Rendered
      bythird-parties
              
              
              -
              
              
              
              -
              
              
              
              450,000
              
              
              
              450
              
              
              
              422,000
              
              
              
              -
              
              
              
              -
              
              
              
              422,450Compensation Cost of
      stock issuedand options
      granted for services
              
              
              -
              
              
              
              -
              
              
              
              200,000
              
              
              
              200
              
              
              
              1,487,500
              
              
              
              -
              
              
              
              -
              
              
              
              1,487,700Compensation Cost of
      stock issuedand options granted
      for servicesto be
      amortized
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              (1,048,754
              )
              
              
              -
              
              
              
              -
              
              
              
              (1,048,754
              )Net Income (Loss)
      atDecember 31,
      2001
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              (2,199,085
              )
              
              
              -
              
              
              
              -
              
              
              
              (2,199,085
              )Balance
      at December 31,2001
              
              
              -
              
              
              
              -
              
              
              
              24,088,458
              
              
              
              24,088
              
              
              
              8,700,933
              
              
              
              (7,941,258
              )
              
              
              (547,500
              )
              
              
              236,263Issuance of
      CommonStock for:Cash from
      third-party investor
              
              
              -
              
              
              
              -
              
              
              
              3,625,000
              
              
              
              3,625
              
              
              
              358,875
              
              
              
              -
              
              
              
              -
              
              
              
              362,500Exercise of
      Options
              
              
              -
              
              
              
              -
              
              
              
              2,006,822
              
              
              
              2,007
              
              
              
              (2,007
              )
              
              
              -
              
              
              
              -
              
              
              
              -Payment
      towardspromissory note
      balances
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              102,803
              
              
              
              102,803Amortized
      CompensationCost of stock issued
      and optionsgranted for
      services
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              759,795
              
              
              
              -
              
              
              
              -
              
              
              
              759,795Compensation Cost of
      stock issuedand options granted
      for services
              
              
              -
              
              
              
              -
              
              
              
              1,200,000
              
              
              
              1,200
              
              
              
              323,300
              
              
              
              -
              
              
              
              -
              
              
              
              324,500Net Income
      (Loss)atDecember
      31, 2002
              
              
              -
              
              
              
              -
              
              
              
              
              
              
              
              --
              
              
              
              -
              
              
              
              (1,933,676
              )
              
              
              -
              
              
              
              (1,933,676
              )Balance
      at December31,
      2002
              
              
              -
              
              
              
              -
              
              
              
              30,920,280
              
              
              
              30,920
              
              
              
              10,140,896
              
              
              
              (9,874,934
              )
              
              
              (444,697
              )
              
              
              (147,815
              )


28


REVOLUTIONS MEDICAL CORPORATION (FORMERLY MAXXON,
INC.)
 (A
Development Stage Company)
  STATEMENTS
OF STOCKHOLDERS' EQUITY (continued)
 From
Inception (August 16, 1996) Through December 31, 2008
  Preferred
                Shares
              
              
              Stock
                Amount
              
              
              Common
                Shares
              
              
              Stock
                Amount
              
              
              Paid-In
                Capital
              
              
              Deficit
                Accumulated
                during
      the
                Development
                Stage
              
              
              Subscription
                Receivable
              
              
              TotalIssuance
      of CommonStock
      for:MPI settlement costs
      of
      stock issuedand
      options grantedfor
      services
              
              
              --
              
              
              
              --
              
              
              
              1,140,000
              
              
              
              1,140
              
              
              
              139,560
              
              
              
              --
              
              
              
              --
              
              
              
              140,700Compensation
      costof
      stock issuedand
      options grantedfor
      services
              
              
              --
              
              
              
              --
              
              
              
              7,000,000
              
              
              
              7,000
              
              
              
              133,000
              
              
              
              --
              
              
              
              --
              
              
              
              140,000Amortized
      compensationcost
      of stockissued
      and optionsgranted
      for services
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              288,959
              
              
              
              --
              
              
              
              --
              
              
              
              288,959Indemnification cost
      of
      stock issuedand
      options grantedfor
      services
              
              
              --
              
              
              
              --
              
              
              
              4,000,000
              
              
              
              4,000
              
              
              
              76,000
              
              
              
              --
              
              
              
              --
              
              
              
              80,000Payment
      towardspromissory
      notebalances
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              69,201
              
              
              
              
              
              
              
              69,201Net
      Income (Loss) atDecember
      31, 2003
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              (1,391,518
              )
              
              
              --
              
              
              
              (1,391,519
              )Balance
      at December31,
      2003
              
              
              --
              
              
              
              --
              
              
              
              43,060,280
              
              
              
              43,060
              
              
              
              10,778,415
              
              
              
              (11,266,452
              )
              
              
              (375,496
              )
              
              
              (820,473
              )Issuance of Common
      Stock
      for:Cash from third-
      party
      investor
              
              
              --
              
              
              
              --
              
              
              
              100,000
              
              
              
              100
              
              
              
              4,900
              
              
              
              --
              
              
              
              --
              
              
              
              5,000Exercise of
      Options
              
              
              --
              
              
              
              --
              
              
              
              5,866,000
              
              
              
              5,866
              
              
              
              248,234
              
              
              
              --
              
              
              
              --
              
              
              
              254,100Exercise of
      Warrants
              
              
              --
              
              
              
              --
              
              
              
              1,462,000
              
              
              
              1,462
              
              
              
              71,638
              
              
              
              --
              
              
              
              (1,000
              )
              
              
              72,100Compensation
      costof
      stock issuedfor
      services
              
              
              --
              
              
              
              --
              
              
              
              32,850,000
              
              
              
              32,850
              
              
              
              881,150
              
              
              
              --
              
              
              
              --
              
              
              
              914,000Payment
      towardspromissorynote
      balances
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              18,750
              
              
              
              18,750Net
      Income (Loss) atDecember
      31, 2004
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              (1,552,008
              )
              
              
              --
              
              
              
              (1,552,008
              )Balance
      at December31,
      2004
              
              
              --
              
              
              
              --
              
              
              
              83,338,280
              
              
              
              83,338
              
              
              
              11,984,337
              
              
              
              (12,818,460
              )
              
              
              (357,746
              )
              
              
              (1,108,531
              )Issuance
      of CommonStock
      for Cash:From
      third-partyinvestors
              
              
              --
              
              
              
              --
              
              
              
              13,039,187
              
              
              
              13,039
              
              
              
              277,661
              
              
              
              --
              
              
              
              --
              
              
              
              290,700From the exercise
      of
      options
              
              
              --
              
              
              
              --
              
              
              
              1,800,000
              
              
              
              1,800
              
              
              
              43,200
              
              
              
              --
              
              
              
              --
              
              
              
              45,000Issuance
      of CommonStock
      forSubscription
              
              
              --
              
              
              
              --
              
              
              
              5,200,000
              
              
              
              5,200
              
              
              
              28,800
              
              
              
              --
              
              
              
              (34,000
              )
              
              
              --Common
      stockissued
      for services
              
              
              --
              
              
              
              --
              
              
              
              21,250,000
              
              
              
              21,250
              
              
              
              455,250
              
              
              
              --
              
              
              
              --
              
              
              
              476,500Common
      stockissuedpursuant
      to JointVenture
              
              
              --
              
              
              
              --
              
              
              
              5,833,331
              
              
              
              5,833
              
              
              
              132,000
              
              
              
              --
              
              
              
              --
              
              
              
              137,833Value
      of warrantsgrantedpursuant
      to JointVenture
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              499,733
              
              
              
              --
              
              
              
              --
              
              
              
              499,733Value
      of optionsgrantedfor
      services
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              130,900
              
              
              
              --
              
              
              
              --
              
              
              
              130,900Reclassification of
      receivablesagainst
      amountsowed
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              357,746
              
              
              
              357,746Net
      Income (Loss) atDecember
      31, 2005
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              (1,310,783
              )
              
              
              --
              
              
              
              (1,310,783
              )Balance
      at December31,
      2005
              
              
              --
              
              
              
              --
              
              
              
              130,460,798
              
              
              
              130,460
              
              
              
              13,551,881
              
              
              
              (14,129,243
              )
              
              
              (34,000
              )
              
              
              (480,902
              )
    
 29
  REVOLUTIONS MEDICAL CORPORATION (FORMERLY MAXXON,
INC.)
 (A
Development Stage Company)
  STATEMENTS
OF STOCKHOLDERS' EQUITY (continued)
 From
Inception (August 16, 1996) Through December 31, 2008
 Preferred
                Shares
              
              
              Stock
                Amount
              
              
              Common
                Shares
              
              
              Stock
                Amount
              
              
              Paid-In
                Capital
              
              
              Deficit
                Accumulated
                during
      the
                Development
                Stage
              
              
              Subscription
                Receivable
              
              
              TotalIssuance
      of CommonStock:From the exercise
      of
      optionsfor
      services
              
              
              --
              
              
              
              --
              
              
              
              1,000,000
              
              
              
              1,000
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              1,000From the exercise
      of
      optionsfor
      cash
              
              
              --
              
              
              
              --
              
              
              
              3,000,000
              
              
              
              3,000
              
              
              
              72,000
              
              
              
              --
              
              
              
              --
              
              
              
              75,000From the exercise
      of
      warrants
              
              
              --
              
              
              
              --
              
              
              
              6,000,000
              
              
              
              6,000
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --Payment
      of CommonStock
      Subscription
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              34,000
              
              
              
              34,000Common
      Stock issuedfor
      services
              
              
              --
              
              
              
              --
              
              
              
              5,500,000
              
              
              
              5,500
              
              
              
              102,000
              
              
              
              --
              
              
              
              --
              
              
              
              107,500Preferred
      Stock issuedfor
      services
              
              
              1,000,000
              
              
              
              1,000
              
              
              
              --
              
              
              
              --
              
              
              
              19,000
              
              
              
              --
              
              
              
              --
              
              
              
              19,000Capital
      contributedby
      shareholder
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              3,000
              
              
              
              --
              
              
              
              --
              
              
              
              3,000Cancellation
      of JointVenturewith
      Globe
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              (625,066
              )
              
              
              --
              
              
              
              --
              
              
              
              (625,066
              )Common
      stockissued
      toGlobe
      then returnedto
      treasury
              
              
              --
              
              
              
              --
              
              
              
              (500,000
              )
              
              
              (500
              )
              
              
              (12,000
              )
              
              
              --
              
              
              
              --
              
              
              
              (12,500
              )Compensationcost
      foroption
      pricereduction
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              50,000
              
              
              
              --
              
              
              
              --
              
              
              
              --Net
      Income (Loss) aDecember
      31, 2006
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              (598,302
              )
              
              
              --
              
              
              
              (598,302
              )Balance
      at December31,
      2006
              
              
              1,000,000
              
              
              
              1,000
              
              
              
              145,460,798
              
              
              
              145,460
              
              
              
              13,160,815
              
              
              $
              (14,727,545
              )
              
              
              --
              
              
              
              (1,427,270
              )From
      the exerciseof
      Issuance ofCommon
      Stock:Reverse
      stocksplit
      (1 for 20)
              
              
              --
              
              
              
              --
              
              
              
              (138,187,826
              )
              
              
              (138,188
              )
              
              
              138,188
              
              
              
              --
              
              
              
              --
              
              
              
              --Sale
      of common stockfor
      cash:
              
              
              --
              
              
              
              --
              
              
              
              845,000
              
              
              
              845
              
              
              
              299,155
              
              
              
              --
              
              
              
              --
              
              
              
              300,000Issuance
      of commonstock
      for ClearImage
      stock
              
              
              --
              
              
              
              --
              
              
              
              8,273,788
              
              
              
              8,274
              
              
              
              3,301,241
              
              
              
              --
              
              
              
              --
              
              
              
              3,309,515Stock
      compensation
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              223,246
              
              
              
              --
              
              
              
              --
              
              
              
              223,246Issuance
      of CommonStock:From the exercise
      of
      optionsfor
      cash
              
              
              --
              
              
              
              --
              
              
              
              125,000
              
              
              
              125
              
              
              
              9,875
              
              
              
              --
              
              
              
              --
              
              
              
              10,000warrants
              
              
              --
              
              
              
              --
              
              
              
              345,662
              
              
              
              346
              
              
              
              6,568
              
              
              
              --
              
              
              
              --
              
              
              
              6,914Common Stock
      issued for services
              
              
              --
              
              
              
              --
              
              
              
              1,225,000
              
              
              $
              1,225
              
              
              
              388,775
              
              
              
              --
              
              
              
              --
              
              
              
              390,000Issuance
      ofrestricted
      stock
              
              
              --
              
              
              
              --
              
              
              
              40,000
              
              
              
              40
              
              
              $
              9,960
              
              
              
              --
              
              
              
              --
              
              
              
              10,000Net
      Income (Loss) atDecember
      31, 2007
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              $
              (4,475,017
              )
              
              
              --
              
              
              
              (4,475,017
              )unknown
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              (7,000
              )BALANCE
      ATDECEMBER
      31, 2007
              
              
              1,000,000
              
              
              
              1,000
              
              
              
              18,127,422
              
              
              $
              18,127
              
              
              $
              17,537,824
              
              
              $
              (19,202,563
              )
              
              
              --
              
              
              $
              (1,645,612
              )
 
 30
  REVOLUTIONS MEDICAL CORPORATION (FORMERLY MAXXON,
INC.)
 (A
Development Stage Company)
  STATEMENTS
OF STOCKHOLDERS' EQUITY (continued)
 From
Inception (August 16, 1996) Through December 31, 2008
  Preferred
                Shares
              
              
              Stock
                Amount
              
              
              Common
                Shares
              
              
              Stock
                Amount
              
              
              Paid-In
                Capital
              
              
              Deficit
                Accumulated
                during
      the Development
                Stage
              
              
              Subscription
                Receivable
              
              
              TotalFrom
      the exercise ofIssuance
      ofCommon
      Stock:Sale
      of common stockfor
      cash:
              
              
              --
              
              
              
              --
              
              
              
              4,720,978
              
              
              $
              4,722
              
              
              
              300,101
              
              
              
              --
              
              
              
              --
              
              
              
              304,823Issuance
      of CommonStock:From the exercise
      of
      optionsfor
      cash
              
              
              --
              
              
              
              --
              
              
              
              2,300,000
              
              
              
              2,300
              
              
              
              395,317
              
              
              
              --
              
              
              
              --
              
              
              
              397,617Common
      Stock issuedfor
      services
              
              
              --
              
              
              
              --
              
              
              
              1,419,704
              
              
              
              1,419
              
              
              
              258,501
              
              
              
              --
              
              
              
              --
              
              
              
              259,920Common
      Stock issuedfor
      repayment of debt
              
              
              --
              
              
              
              --
              
              
              
              271,491
              
              
              
              271
              
              
              
              132,759
              
              
              
              --
              
              
              
              --
              
              
              
              133,030Common
      Stock issued toClear
      Image investorsto
      participate in themerger
              
              
              --
              
              
              
              --
              
              
              
              43,600
              
              
              
              44
              
              
              
              12,164
              
              
              
              --
              
              
              
              --
              
              
              
              12,208Stock
      compensation
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              342,801
              
              
              
              --
              
              
              
              --
              
              
              
              342,801Acquired
      deficit of formerMinority
      interest nowOwned
      100%
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              (209,776
              )
              
              
              --
              
              
              
              --
              
              
              
              (209,776
              )Net
      Income (Loss) atDecember
      31, 2008
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              --
              
              
              
              (1,335,154
              )
              
              
              --
              
              
              
              (1,335,154
              )BALANCE
      ATDECEMBER
      31, 2008
              
              
              1,000,000
              
              
              $
              1,000
              
              
              
              26,883,195
              
              
              $
              26,883
              
              
              $
              18,769,691
              
              
              $
              (20,537,717
              )
              
              
              --
              
              
              $
              (1,740,143
              )


31





REVOLUTIONS
MEDICAL CORPORATION (FORMERLY MAXXON, INC.)


(A
Development Stage Company)




NOTES
TO FINANCIAL STATEMENTS


DECEMBER
31, 2008




NOTE
1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES




Organization and Nature of
Operations




Revolutions
Medical Corporation (formerly Maxxon, Inc.), a Nevada corporation, (“RMC” or
“the Company” or “RevMed”) 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. The Company has no products for
sale at this time.




On March
26, 2007, RevMed completed the acquisition of Clear Image Acquisition
Corporation (“Acquisition Corp.”) in exchange for 8,273,788 shares of RevMed
common stock. Acquisition Corp is a company that was formed by certain
shareholders of Clear Image, Inc. (“Clear Image”) in order to assemble a control
block of the shares of Clear Image for the purposes of such a transaction. The
sole asset of Acquisition Corp was a block of 8,260,139 shares of the Common
Stock of Clear Image, a development stage company which is developing certain
proprietary and patent pending technology related to color MRI scans. The block
of Clear Image shares owned by Acquisition Corp represented 62.2% of Clear
Image's outstanding common stock.




During
the fourth quarter of 2008, the Company commenced a short form merger to acquire
the remaining minority interest in Clear Image. This short form merger was
completed by December 2, 2008. The Company now owns 100% of the former Clear
Image. Clear Images assets have been consolidated on our books and all
inter-company transactions have been eliminated.




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




On
January 2, 2006, the first day of the 2006 fiscal year, the Company adopted
Statement of Financial Accounting Standards No. 123 (revised 2004), “Share-Based
Payment,” (“SFAS 123R”) which requires the measurement and recognition of
compensation expense for all share-based payment awards made to employees and
directors based on estimated fair values. SFAS 123R supersedes the Company's
previous accounting under Accounting Principles Board Opinion No. 25,
“Accounting for Stock Issued to Employees” (“APB 25”) beginning in fiscal 2006.
The Company adopted SFAS 123R using the modified prospective transition method.
Accordingly, the Company's consolidated financial statements for prior fiscal
years have not been restated to reflect the impact of SFAS 123R.




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.




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.




32




Earnings (Loss) per
Share




The
Company computes net income 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 income (loss) per share is
calculated by dividing net income (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 income per share is computed by
dividing the net income for the period by the weighted average number of common
and common equivalent shares outstanding during the period. The calculation of
diluted income (loss) per share of common stock assumes the dilutive effect of
stock options and warrants outstanding. During a loss period, the assumed
exercise of outstanding stock options and warrants has an anti-dilutive effect.
Therefore, the outstanding stock options were not included in the December 31,
2008 and 2007 calculations of loss per share.




Use of
Estimates




The
preparation of financial statements in conformity with generally accepted
principles requires management to make estimates and assumptions that affect the
reported amounts of 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.




Intangible
assets include patents and trademarks, which are valued at acquisition through
independent appraisals. Debt issuance costs are amortized over the terms of the
various agreements. Patents and trademarks are amortized on a straight-line
basis over periods varying from 7 to 40 years.





In 2007,
the Company acquired a 62.2% interest in Clear Image, Inc. (“Clear
Image”).  Clear Image was a privately held company and was
conducting research and development on Color MRI Technology.  Clear
Image was not able to secure the funding needed to keep this research and
development going into the future.  Clear Image had expensed the
research and development costs in accordance with accounting standards in effect
at the time. The Company believed it to be advantageous to acquire a controlling
interest in Clear Image and keep the technology in development rather than
starting all over again. The Company exchanged approximately 8.2 million of its
common shares which were trading between $0.40 and $0.50 at the time of
acquisition.  To arrive at a value for the Color MRI Technology the
Company and Clear Image determined the amount of funding provided for the
research and development of this technology by looking at the amount expended
from 1999 until the acquisition date. The value of the Company’s stock exchanged
for the controlling interest exceeded those expensed amounts by approximately
$23,000 which was recorded as goodwill because there were no other assets to
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.




In
December 2007, the Financial Accounting Standards Board (“FASB”) issued
Statement of Financial Accounting Standard (“SFAS”) No. 141(R), “Business
Combinations,” (“SFAS 141(R)”) which replaces SFAS 141. SFAS 141(R) establishes
principles and requirements for how an acquirer in a business combination
recognizes and measures in its financial statements the identifiable assets
acquired, the liabilities assumed, and any controlling interest; recognizes and
measures goodwill acquired in the business combination or a gain from a bargain
purchase; and determines what information to disclose to enable users of the
financial statements to evaluate the nature and financial effects of the
business combination. SFAS 141(R) is effective for acquisitions by the Company
taking place on or after January 1, 2009. Early adoption is prohibited.
Accordingly, a calendar year-end company is required to record and disclose
business combinations following existing accounting guidance until January 1,
2009. The Company will assess the impact of SFAS 141(R) if and when a future
acquisition occurs.




Also, in
December 2007, the FASB issued SFAS No. 160, “Noncontrolling Interests in
Consolidated Financial Statements - an amendment of ARB No. 51,” (“SFAS 160”).
SFAS 160 establishes new accounting and reporting standards for the
noncontrolling interest in a subsidiary and for the deconsolidation of a
subsidiary. Before this statement, limited guidance existed for reporting
noncontrolling interests (minority interest). As a result, diversity in practice
exists. In some cases minority interest is reported as a liability and in others
it is reported in the mezzanine section between liabilities and equity.
Specifically, SFAS 160 requires the recognition of a noncontrolling interest
(minority interest) as equity in the consolidated financials statements and
separate from the parent's equity. The amount of net income attributable to the noncontrolling
interest will be included in consolidated net income on the face of the income
statement. SFAS 160 clarifies that changes in a parent's ownership interest in a
subsidiary that do not result in deconsolidation are equity transactions if the
parent retains its controlling financial interest. In addition, this statement
requires that a parent recognize gain or loss in net income when a subsidiary is
deconsolidated. Such gain or loss will be measured using the fair value of the
noncontrolling equity investment on the deconsolidation date. SFAS 160 also
includes expanded disclosure requirements regarding the interests of the parent
and its noncontrolling interests. SFAS 160 was effective for the Company on
January 1, 2009. SFAS 160 had no impact on the Company's financial position,
results of operations or cash flows.




33




In
February 2008, the FASB issued FASB Staff Position No. 140-3, “Accounting for
Transfers of Financial Assets and Repurchase Financing Transactions,” (“FSP
140-3”). This FSP provides guidance on accounting for a transfer of a financial
asset and the transferor's repurchase financing of the asset. This FSP presumes
that an initial transfer of a financial asset and a repurchase financing are
considered part of the same arrangement (linked transaction) under SFAS 140.
However, if certain criteria are met, the initial transfer and repurchase
financing are not evaluated as a linked transaction and are evaluated separately
under SFAS 140. FSP 140-3 was effective for the Company on January 1, 2009. The
adoption of FSP 140-3 had no impact on the Company's financial position, results
of operations or cash flows.




In April
2008, the FASB issued FASB Staff Position No. 142-3, “Determination of the
Useful Life of Intangible Assets,” (“FSP 142-3”). This FSP amends the factors
that should be considered in developing renewal or extension assumptions used to
determine the useful life of a recognized intangible asset under SFAS No. 142,
“Goodwill and Other Intangible Assets,” (“SFAS 142”). The intent of this FSP is
to improve the consistency between the useful life of a recognized intangible
asset under SFAS 142 and the period of expected cash flows used to measure the
fair value of the asset under SFAS 141(R) and other U.S. generally accepted
accounting principles. This FSP was effective for the Company on January 1, 2009
and had no material impact on the Company's financial position, results of
operations or cash flows.




In May,
2008, the FASB issued SFAS No. 162, “The Hierarchy of Generally Accepted
Accounting Principles,” (“SFAS 162”). SFAS 162 identifies the sources of
accounting principles and the framework for selecting the principles used in the
preparation of financial statements of nongovernmental entities that are
presented in conformity with generally accepted accounting principles (GAAP) in
the United States (the GAAP hierarchy). SFAS 162 is effective November 15, 2008.
The FASB has stated that it does not expect SFAS 162 will result in a change in
current practice. The application of SFAS 162 had no effect on the Company's
financial position, results of operations or cash flows.




The FASB
issued FASB Staff Position No. APB 14-1, “Accounting for Convertible Debt
Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash
Settlement),” (“FSP APB 14-1”). The Staff Position specifies that issuers of
convertible debt instruments that may be settled in cash upon conversion should
separately account for the liability and equity components in a manner that will
reflect the entity's nonconvertible debt borrowing rate when interest cost is
recognized in subsequent periods. FSP APB 14-1 provides guidance for initial and
subsequent measurement as well as derecognition provisions. The Staff Position
was effective as of January 1, 2009 and had no material effect on the Company's
financial position, results of operations or cash flows.




In June,
2008, the FASB issued FASB Staff Position No. EITF 03-6-1, “Determining Whether
Instruments Granted in Share-Based Payment Transactions are Participating
Securities,” (“FSP EITF 03-6-1”). The Staff Position provides that unvested
share-based payment awards that contain nonforfeitable rights to dividends or
dividend equivalents are participating securities and must be included in the
earnings per share computation. FSP EITF 03-6-1 was effective January 1, 2009
and had no effect on the Company's financial position, results of operations,
earnings per share or 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 $(20,504,217) for the
period from inception (August 16, 1996) to December 31, 2008. 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. The financial statements do not
include any adjustments that might be necessary if the Company is unable to
continue as a going concern.




34




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
the CFO individually. A hearing is currently set for May 1, 2009.




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.
Mr. Wheet 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 of all 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.




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, but at December 31, 2008, that
accrued interest had been reduced to $41,469 due to partial repayment as
discussed below. 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 at the time of each quarterly issuance of common
stock.   During 2008, the Company issued 271,491 shares at a
total value of $133,030 to partially repay this debt.




35




Amounts Due Pursuant to
Employment and Consulting Agreements




As of
December 31, 2008, the Company had accrued approximately $984,128 pursuant to
employment agreements. 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 previous employment 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 Retractable Safety Needle Devices




Although
the Company has received patents for previous safety needle designs, the ReVac
Safety Syringe, the ReTrac Auto Retractable Safety Scalpel with Permanent Lock,
and the Auto Retractable Safety IV Catheter do not yet have patents. Globe has
filed a patent application related to ReTrac and patent applications related to
ReVac and the Safety IV Catheter will be filed as soon as practicable. Because
the Company does not yet have patent protection for these devices and there is
no assurance that such patent protections will be sought or 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.




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 December 31, 2008, and expects to
pay $210,000 by the end of the second quarter.




NOTE
5 - PREFERRED STOCK AND COMMON STOCK TRANSACTIONS




SERIES
2006 PREFERRED STOCK




Dividends:
Currently, the sole holder of the 1,000,000 shares of Series 2006 Preferred
Stock outstanding is Rondald L. Wheet, our Chairman, President and CEO. The
holder of the Series 2006 Preferred stock is entitled to receive, ratably,
dividends when, as and if declared by the board of directors out of funds
legally available therefore. 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, the
holders of Series 2006 Preferred stock are entitled to receive a liquidation
preference of $0.001 for each share of Series 2006 Preferred stock prior to
payment being made to any junior stock.




Conversion:
The holders of Series 2006 Preferred stock may convert each share into 1 share
of common stock.




Preemption:
The holders of Series 2006 Preferred stock have no preemptive rights and they
are not subject to further calls or assessments.




Voting
Rights: The holders of Series 2006 Preferred stock are entitled to 125 votes for
each share of common stock into which their Series 2006 Preferred stock is then
convertible (currently 1 share), voting together with our common stock as a
single class. Cumulative voting is not permitted. Upon conversion of a Series
2006 Preferred share, each share of common stock issued upon the conversion will
be entitled to only one (1) vote per share.




36




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.




2008
COMMON STOCK TRANSACTIONS




During
the year ended December 31, 2008, the Company issued 1,000,000 stock options to
an individual in conjunction with a consulting agreement. These options were
valued at $0.10 per share and were exercised during the first Quarter of 2008.
The Company received $100,000 in proceeds related to the exercise of these
options.




Also
during the year ended December 31, 2008, the Company issued shares of common
stock to one individual as payment for debt owed under a note payable. The debt
will be satisfied with Company stock expensing an even amount each quarter over
a period of twelve months. During the year ended December 31, 2008, 271,491
shares of stock were issued pursuant to this agreement. See Note 4 for
additional discussion.




During
the year ended December 31, 2008, an additional 1,300,000 shares of common stock
were issued as option holders exercised their options to purchase common stock
and 4,720,978 shares were issued to third party investors. The Company received
proceeds of $702,440 in connection with these shares issuances.




During
the year ended December 31, 2008, the Company issued 1,419,704 shares of common
stock with a total value of $259,920 in lieu of cash as payment for consulting
services.




2007 Common Stock
Transactions




On
January 18, 2007, the Company's name changed from Maxxon, Inc. to Revolutions
Medical Corporation and the Company's common stock was reverse split on a 20 to
1 basis which changed the number of outstanding shares of common stock from
145,560,798 to 7,272,972. The number of authorized shares of common stock was
not affected by the reverse stock split and remains at 250,000,000
shares.




During
the three months ended March 31, 2007, the Company issued 250,000 shares of its
common stock for $58,500 in cash. The Company issued 25,000 shares of its common
stock for legal services valued at $12,500 and 500,000 shares of its common
stock for consulting services valued at $200,000. The Company also issued
8,273,788 shares of its common stock valued at $3,309,515 for Clear Image
Acquisition Corp. (See Note 3- Acquisition of Clear Image Acquisition Corp). The
shares were valued based on the market price of the Company's common stock at
the date of each transaction.




During
the three months ended June 30, 2007, the Company issued 371,000 shares of its
restricted common stock for $185,500 in cash.




During
the three months ended September 30, 2007, the Company issued 224,000 shares of
its restricted common stock for $56,000 in cash. The Company issued 300,000
shares for consulting services valued at $102,500 and 400,000 shares for color
MRI research and development valued at $75,000. During the quarter ended
September 30, 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 to the warrant
holder.




During
the quarter ended December 31, 2007, the Company issued 125,000 shares of its
common stock upon exercise of stock options at $0.08 per share for a total of
$10,000. The Company also issued 40,000 shares of its restricted stock at $0.25
per share for a total of $10,000. The Company also granted 6,000,000 options to
the three directors at $0.08 per share. These options are immediately
exerciseable and expire in three years. The Company also issued 5,000,000
immediately exerciseable stock options at $0.08 per share to its president in
conjunction with entering into a new three year employment agreement with
him.




37




NOTE
6 - STOCK OPTIONS AND WARRANTS OUTSTANDING




The
following tables summarize information about the stock options and warrants
outstanding at December 31, 2008:




OPTIONS
            
            
            WARRANTS
            
            
            TOTAL
            
            
            WEIGHTED
      AVERAGE EXERCISE PRICEBalance at
      December 31, 2007
            
            
            10,985,000
            
            
            
            107,500
            
            
            
            11,092,500
            
            
            $
            0.090Granted
            
            
            1,800,000
            
            
            
            -
            
            
            
            1,800,000
            
            
            
            0.215Exercised
            
            
            (2,425,000
            )
            
            
            -
            
            
            
            (2,425,000
            )
            
            
            0.199Expired/Forfeited
            
            
            -
            
            
            
            (107,500
            )
            
            
            (107,500
            )
            
            
            5.000BALANCE AT
      DECEMBER 31, 2008
            
            
            10,360,000
            
            
            
            -
            
            
            $
            10,360,000
            
            
            
            0.157




OPTIONS
      OUTSTANDING
            
            
            EXERCISABLERange
      of  Exercise Price
            
            Number
              Outstandingat
              December
      31,2008
            
            
            Weighted
              Average
              Remaining
              Contractual Life
            
            
            Weighted
              Average
      Exercise
              Price
            
            
            Number
              Exercisable
      at
              December
      31, 2008
            
            
            Weighted
              Average
              Exercise
              PriceOPTIONS0.08 -
0.36
            
            
            10,250,000
            
            
            
            2.00
            
            
            $
            0.10
            
            
            
            10,250,000
            
            
            $
            0.101.00
            
            
            55,000
            
            
            
            4.34
            
            
            
            1.00
            
            
            
            55,000
            
            
            
            1.0010.00
            
            
            55,000
            
            
            
            1.00
            
            
            
            10.00
            
            
            
            55,000
            
            
            
            10.0010,360,000
            
            
            
            
            
            
            
            
            
            
            
            10,360,000




NOTE
7 - RELATED PARTY TRANSACTIONS




In
connection with the acquisition of Clear Image Acquisition Corp. by RevMed, Ron
Wheet, CEO and Director, received 2,286,000 shares of restricted RevMed common
stock, Dr. Beahm, a Director, received 1,599,125 shares of restricted RevMed
common stock, and Mr. O'Brien, a Director, received 1,645,625 shares of
restricted RevMed common stock. Mr. Wheet and Mr. O'Brien were directors and
shareholders and Dr. Beahm was a shareholder of Clear Image Acquisition Corp.
prior to its acquisition by the Company.




During
the year ended December 31, 2008, the Company accrued $180,000 of salary
payments due to Tom O'Brien, a director, for his service as president of Clear
Image, Inc. Mr. O'Brien's monthly salary is $15,000.




NOTE
8 - REVERSE STOCK SPLIT




On
January 18, 2007, the Company's name changed from Maxxon, Inc. to Revolutions
Medical Corporation and the Company's common stock was reverse split on a 20 to
1 basis which changed the number of outstanding shares of common stock from
145,560,798 to 7,272,972. The number of authorized shares of common stock was
not affected by the reverse stock split and remains at 250,000,000
shares.




NOTE
9 - ACQUISITION OF CLEAR IMAGE ACQUISITION CORP




In
December 2008, the Company acquired the minority interest of Clear Image
Acquisition Corporation (“Acquisition Corp”). The Company had previously
acquired 62.2% of Acquisition Corp as part of the acquisition of Clear Image,
Inc. (“Clear Image”) in March 2007. The purchase price for the remaining
minority interest of Acquisition Corp, excluding transaction costs, included a
stock payment of 12,208 shares at closing.




On March
26, 2007, RevMed completed the acquisition of Clear Image Acquisition
Corporation (“Acquisition Corp.”) in exchange for 8,273,788 shares of RevMed
common stock. Acquisition Corp is a company that was formed by certain
shareholders of Clear Image, Inc. (“Clear Image”) in order to assemble a control
block of the shares of Clear Image for the purposes of such a transaction. The
sole asset of Acquisition Corp was a block of 8,260,139 shares of the Common
Stock of Clear Image, a development stage company which is developing certain
proprietary and patent pending technology related to color MRI scans. The block
of Clear Image shares owned by Acquisition Corp represented 62.2% of Clear
Image's outstanding common stock. By acquiring Acquisition Corp, RevMed has
acquired control of Clear Image, Inc. as a partially-owned
subsidiary.




38




In
determining the number of shares to be exchanged by RevMed for the shares of
Clear Image shares held by Acquisition Corp., the Board based the transaction
value on the funds expended by Clear Image for the color MRI technology in its
then current state, using a value of Forty Cents ($.40) per share, which was the
average market value when the acquisition agreement was signed in January, 2007.
During the third quarter of 2007, it was determined that the accounting
treatment for the transaction should be accounted for in accordance with FASB
Interpretation No. 4. “Applicability of FASB Statement No.2 to Business
Combinations Accounted for by the Purchase Method” and Statement of Financial
Accounting Standards No. 2 “Accounting for Research and Development Costs.”
which require research and development costs to be expensed if there are no
alternative uses. Accordingly, the Company recorded goodwill of $23,274 and an
expense of $3,309,515.




The
shareholders of Acquisition Corp. did not receive a larger portion of the voting
rights in RevMed, the surviving company, because of RevMed's outstanding
preferred stock (See Note 5. “Preferred Stock and Common Stock Transactions”),
so the transaction did not require the use of recapitalization or reverse merger
accounting. RevMed plans to pay the minimal costs of Acquisition Corp's
liquidation and dissolution.




Prior to
RevMed's acquisition of Acquisition Corp., RevMed's officer and directors were
directors and shareholders of Clear Image, Inc. and, along with other
shareholders, contributed their Clear Image shares to Acquisition Corp. In
connection with RevMed's acquisition of Acquisition Corp., Ron Wheet, RevMed's
CEO and a Director, received 2,286,000 shares of RevMed restricted common
stock;Dr. Beahm, a Director, received 1,599,125 shares of RevMed restricted
common stock; and Mr. O'Brien, a Director, received 1,645,625 shares of RevMed
restricted common stock.




NOTE
10 - SUBSEQUENT EVENT




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 will be
paid 250,000 shares of common stock upfront and 7% of any financing raised going
forward. This common stock is restricted as to resell for six
months.




39




Index to and Description of
Exhibits




EXHIBITS




No.
            
            Description
      of Exhibit2.1
            
            Amended Articles of
      Incorporation (filed as Exhibit 2.1 to our Amended Form 10-SB
      filed August 15, 2001 with amendment filed as Exhibit A to ourDefinitive
      14 C Information Statement filed November 29, 2007)2.2
            
            Bylaws
      (filed as Exhibit 2.2 to our Amended Form 10-SB filed August 15,2001)4.1
            
            Form
      of Common Stock Certificate (filed as Exhibit 3.1 to our Form 10-SBfiled
      December 23, 199910.1
            
            Joint
      Venture Agreement with Globe dated November 3, 2006 (incorporated herein
      by reference to Exhibit 10.1 of the Company's Form 10-QSB for the quarter
      ended September 30, 2006, filed with the SEC on November 17,
      2006)10.2
            
            Safety
      Scalpel Joint Venture agreement with Globe dated August 11, 2006
      (incorporated herein by reference to Exhibit 10.2 of the Company's Form
      10-QSB for the quarter ended June 30, 2006, filed with the SEC on August
      19, 2006.)10.3
            
            Employment
      Agreement with Rondald L. Wheet (Exhibit 10.3 of the Company's Form 10-KSB
      for the year ended December 31, 2007)10.4
            
            Mutual Release and
      Settlement Agreement between the Company and Gifford M. Mabie dated April
      14, 2006 (incorporated herein by reference to Exhibit 10.13 of the
      Company's Form 10-KSB for the year ended December 31, 2004, filed with the
      SEC on April 15, 2006.)10.5
            
            Agreement
      and Plan of Merger between Cerro Mining Corporation and the Company. dated
      May 9, 1997 (filed as Exhibit 6.6 to our Form 10-SB filed December 23,
      1999)10.6
            
            Agreement
      and Plan of Merger between Clear Image Acquisition Corporation and the
      Company dated January 26, 2007 (filed as Exhibit 10.6 to our Form 8-K
      filed January 26, 2007)31.1
            
            Certification
      of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley
      Act of 2002*31.2
            
            Certification
      of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley
      Act 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*32.2
            
            Certification
      Pursuant To 18 U.S.C. 1350), As Adopted Pursuant to Section 906 of the
      Sarbanes-Oxley Act of 2002*




* Filed
Herewith




40




SIGNATURES




In
accordance with Section 13 or 15(d) 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. WHEETRondald
      L. Wheet,Chief
      Executive OfficerMarch
      10, 2010






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
            
            March 10,
    2010Rondald L.
      Wheet
            
            Principal Executive
      Officer and Principal Accounting Officer)/s/ DR. THOMAS
      BEAHM
            
            Director
            
            March 10,
    2010Dr. Thomas
      Beahm/s/ THOMAS
      O'BRIEN
            
            Director
            
            March 10,
    2010Thomas
      O'Brien






41