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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 10-Q/A
 
þ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
   
For the quarterly period ended September 30, 2009
   
OR
   
o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the Transition Period from ___________ to____________

Commission File Number: 0-28629
 
REVOLUTIONS MEDICAL CORPORATION
(Exact Name of Registrant in its Charter)
 
NEVADA
 
73-1526138
(State or other jurisdiction of
 
(IRS Employer I.D. No.)
incorporation)
   
 
670 MARINA DRIVE, 3 RD FLOOR
CHARLESTON, SC 29492
(Address of principal executive offices and Zip Code)
(843) 971-4848
(Registrant’s telephone number, including area code)
 
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months, and (2) has been subject to such filing requirements for the past 90 days. Yes þ  No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files. Yes   o   No   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:
 
Large accelerated filer    ¨
Non-accelerated filer    ¨
(Do not check if a smaller reporting company)
Accelerated filer    ¨ Smaller reporting company    þ
 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨  No þ
 
As of November 13, 2009, there were 33,147,891 shares outstanding of the registrant’s common stock
 
EXPLANATORY NOTE:
 
The Company is filing this amended Form 10-Q for the period ended September 30, 2009 for the following reasons:
 
    1.      
To revise Item 4. Controls and Procedures to maintain consistency with the disclosure provided in the Company’s Annual Report on Form 10-K for the year ended December 31, 2008.
 
    2.      
To amend the certifications required by Item 601(b)(31) to be in the exact form prescribed by Item 601(b)(31) of Regulation S-K.




 
 
EXPLANATORY NOTE:
 
The Company is filing this amended Form 10-Q for the period ended September 30, 2009 for the following reasons:
 
1.  
To revise Item 4. Controls and Procedures to maintain consistency with the disclosure provided in the Company’s Annual Report on Form 10-K for the year ended December 31, 2008.
 
2.  
To amend the certifications required by Item 601(b)(31) to be in the exact form prescribed by Item 601(b)(31) of Regulation S-K.

 

 
TABLE OF CONTENTS

      Page
       
PART I -FINANCIAL INFORMATION  
       
 
ITEM 1.
FINANCIAL STATEMENTS
1
       
   
Consolidated Balance Sheets
1
       
   
Consolidated Statements of Operations
2
       
   
Consolidated Statements of Cash Flows
3
       
   
Notes to Consolidated Financial Statements
5
       
 
ITEM 2.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
10
       
 
ITEM 3.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
11
       
 
ITEM 4.
CONTROLS AND PROCEDURES
11
       
PART II - OTHER INFORMATION  
       
 
ITEM 1.
LEGAL PROCEEDINGS
12
       
 
ITEM 1A.
RISK FACTORS
12
       
 
ITEM 2.
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
12
       
 
ITEM 3.
DEFAULTS UPON SENIOR SECURITIES
12
       
 
ITEM 4.
SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
12
       
 
ITEM 5.
OTHER INFORMATION
12
       
 
ITEM 6.
EXHIBITS
12

i

 
PART I. FINANCIAL INFORMATION
 
ITEM 1. FINANCIAL STATEMENTS
 
REVOLUTIONS MEDICAL CORPORATION
(A Development Stage Company)
 
BALANCE SHEET
 (Unaudited)

   
September 30, 2009
   
December 31, 2008
 
             
ASSETS
           
             
CURRENT ASSETS
           
Cash
  $ 23,549     $ 4,796  
                 
NON-CURRENT ASSETS
               
Fixed Assets
    15,000        
Goodwill
    52,671       23,276  
                 
TOTAL ASSETS
  $ 91,220     $ 28,072  
                 
LIABILITIES AND SHAREHOLDERS' EQUITY
               
                 
CURRENT LIABILITIES
               
Accounts payable and accrued liabilities
  $ 168,389     $ 466,683  
Accrued Salaries
    731,599       1,158,103  
Notes Payable and Accrued Interest
    10,000       143,429  
                 
Total current liabilities
    909,988       1,768,215  
                 
                 
Total liabilities
    909,988       1,768,215  
                 
SHAREHOLDERS' DEFICIENCY
               
Preferred stock, $0.001 par value, 5,000,000 shares authorized;
1,000,000 shares issued and outstanding
    1,000       1,000  
Common stock, $0.001 par value, 250,000,000 shares authorized;
33,147,891 and 26,883,195 shares issued and outstanding at 9/30/08
and 12/31/08, respectively
    33,148       26,883  
                 
Paid in capital
    21,756,033       18,769,691  
Deficit accumulated during the development stage
    (22,608,949 )     (20,537,717 )
                 
Total shareholders' deficiency
    (818,768 )     (1,740,143 )
                 
TOTAL LIABILITIES AND SHAREHOLDERS' DEFICIENCY
  $ 91,220     $ 28,072  
 
The accompanying notes are an integral part of the interim financial statements
1

 
REVOLUTIONS MEDICAL CORPORATION
 
(A Development Stage Company)
 
STATEMENTS OF OPERATIONS
 (Unaudited)

   
From
Inception
(August 16,
1996) Through
September 30,
2009
   
 
 
Nine Months Ended
September 30,
 
       
2009
   
2008
 
                   
Investment Income
  $ 170,753     $     $ 170,753  
Other Income
    3,857             3,857  
      174,610             174,610  
EXPENSES
                       
Research and development
    2,586,056       303,000       146,040  
Purchased R&D
    3,309,515              
General and administrative
    14,720,453       152,689       543,094  
Total operating expenses
    20,616,024       455,689       689,134  
                         
Operating income (loss)
    (20,441,414 )     (455,689 )     (689,134 )
                         
Interest income
    17,276              
                         
Interest expense
    122,297              
                         
Gain on disposal of assets
    794              
                         
Gain on extinguishment of debt
    (152,914 )     (163,312 )     10,398  
                         
Depreciation and amortization
    75,536              
                         
Compensation cost for options
    2,018,280       1,452,231       251,261  
                         
Net loss before minority interest
    (22,792,371 )     (2,071,232 )     (929,997 )
                         
Minority Interest in Subsidiary Loss
    (183,422 )           (57,744 )
                         
Net loss from operations
  $ (22,608,949 )   $ (2,071,232 )   $ (872,253 )
                         
Weighted average shares outstanding
    36,896,713       31,432,872       19,376,862  
                         
Net loss per share (Note 1)
  $ (0.61 )   $ (0.07 )   $ (0.04 )
 
The accompanying notes are an integral part of the interim financial statements
2

 
REVOLUTIONS MEDICAL CORPORATION
(A Development Stage Company)
 
STATEMENTS OF CASH FLOWS
 (Unaudited)

   
From Inception
(August 16, 1996) Through
September 30,
2009
   
Nine Months Ended
September 30,
 
       
2009
   
2008
 
                   
OPERATING ACTIVITIES
                 
Loss from operations before minority interest
  $ (22,608,949 )   $ (2,071,232 )   $ (929,997 )
Plus non-cash charges to earnings
                       
Stock compensation expense
    2,018,280       1,452,231       251,261  
Depreciation and amortization
    75,525              
Purchase R&D - Clear Image
    3,309,514              
Common stock issued for services
    4,253,369       636,041       27,500  
Preferred stock issued for services
    20,000              
Expenses paid by third parties
    57,134              
Contribution of services by officer and employees
    499,154              
Services by officer and employees paid for
                       
with non-cash consideration
    167,500              
Compensation cost for option price reduction
    50,000              
Amortization of compensation cost for options granted to non-employees and common stock issued for services
    1,775,577              
Allowance for doubtful accounts
    50,900              
Gain on extinguishment of debt
    (10,398 )           (10,398 )
Write-off of Notes Receivable
    14,636              
Write-off of Notes Payable
    (8,239 )           (8,239 )
Write-off of organizational costs
    3,196              
Write-off of zero value investments
    785,418              
Write-off of leasehold improvements and computer equipment
    2,006              
Compensation costs for stock options and warrants granted to non-employees
    1,205,015              
Change in working capital accounts:
                       
(Increase) decrease in receivables from related parties
    (68,900 )            
Increase in other assets
    (4,395 )     (4,395 )      
(Increase) decrease in goodwill
    (23,276 )            
(Increase) decrease in other receivables
    (176,577 )            
Increase (decrease) in accrued salaries and consulting
    506,546       (426,505 )     (63,050 )
Increase (decrease) in accrued interest
    91,177              
Increase (decrease) in accounts payable and accrued liabilities
    1,259,936       (298,294 )     137,396  
Total operating activities
    (6,455,850 )     (712,153 )     (595,527 )
INVESTING ACTIVITIES
                       
Purchase of equipment
    (67,042 )            
Purchase of furniture
    (15,000 )     (15,000 )      
Investment in patent development
    (25,000 )     (25,000 )      
Investment in syringe patent development
    (10,000 )            
Investment in Ives Health Company
    (251,997 )            
Investment in The Health Club
    (10,000 )            
Total investing activities
    (379,039 )     (40,000 )      
FINANCING ACTIVITIES
                       
Loans from shareholders
    13,907              
Repayment of loans from shareholders
    (8,005 )            
Repayments of Promissory Notes
    57,325       (133,429 )      
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 4,351,501 345,634 288,064
                       
From exercise of stock options
    1,881,118       558,701       371,416  
Less: Issue Costs
    (102,318 )            
Convertible debentures issued for cash
    355,000              
Payment of exclusive license note payable
    (100,000 )            
Total financing activities
    7,056,005       770,906       659,480  
Minority interest
    (197,567 )           (57,744 )
Change in cash
    23,549       18,753       6,209  
Cash at beginning of period
          4,796       2,398  
Cash at end of period
  $ 23,549     $ 23,549     $ 8,607  
( Continued )
The accompanying notes are an integral part of the interim financial statements
3

REVOLUTIONS MEDICAL CORPORATION
(A Development Stage Company)
 
STATEMENTS OF CASH FLOWS, Continued
(Unaudited)
 

   
From Inception
(August 16,
1996) Through
September 30,
2009
   
 
Nine Months Ended
September 30,
 
       
2009
   
2008
 
                   
Supplemental disclosure of cash flow information:
                 
Cash paid for interest and taxes during the period
  $ 57,571     $     $  
                         
Non-cash financing and investing activities:
                       
Investment in Globe Joint Venture
    (637,566 )            
Common stock issued to founders
    7,000              
Common stock issued in connection with merger with Cerro Mining Corporation
    300              
20 to 1 reverse stock split
    138,188              
Common stock issued in Ives merger
    346,262              
Common stock subscriptions
    69,800              
Common stock issued to extinguish debt
                   
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             70,281  
Common stock issued for convertible debentures
    190,660              
Common stock issued for services
    706,663              
Common stock issued to pay Ives debt
    27,000              
Common stock issued to Clear Image shareholders under short form merger
    12,208              
 
The accompanying notes are an integral part of the interim financial statements
4


REVOLUTIONS MEDICAL CORPORATION AND SUBSIDIARY
 
(A Development Stage Company)
 
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2009
(UNAUDITED)
 
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 
Basis of Presentation
 
The accompanying interim consolidated financial statements of Revolutions Medical Corporation (“RevMed”) referred to as the “Company” are unaudited; however, in the opinion of management, the interim consolidated financial statements reflect all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results for the interim periods. All intercompany balances and transactions have been eliminated in consolidation. The results of operations for the nine months ended September 30, 2009 are not necessarily indicative of the results to be expected for the year ending December 31, 2009. These consolidated financial statements should be read in conjunction with the consolidated financial statements and notes for the year ended December 31, 2008 appearing in the Company’s Annual Report on Form 10-K for the year ended December 31, 2008, as filed with the Securities and Exchange Commission. Subsequent events have been considered through the filing date of this report.
 
Organization and Nature of Operations
 
Revolutions Medical Corporation, a Nevada corporation, (“RevMed” or “the Company”) is principally engaged in the design and development of retractable safety needle devices intended to reduce the risk of accidental needle stick injuries among health care workers. During 2008, RevMed acquired 100% of the common stock of Clear Image, Inc., which was developing 3D color MRI technology. The Company now owns this technology as well. The Company has no products for sale at this time.
 
Development Stage Company
 
Since its inception in 1996, the Company has been considered a development stage enterprise for financial reporting purposes as significant efforts have been devoted to raising capital and to research and development of various safety needle devices.
 
Cash and Cash Equivalents
 
The Company considers highly liquid investments (those readily convertible to cash) purchased with original maturity dates of three months or less to be cash equivalents.
 
Stock-based Compensation
 
The Company has adopted Statement of Financial Accounting Standards (“SFAS”) No. 123 (revised 2004), “Share-Based Payment” (“SFAS 123R”). SFAS 123R requires the recognition of the cost of employee services received in exchange for an award of equity instruments in the financial statements and is measured based on the grant date fair value of the award. SFAS 123R also requires the stock option compensation expense to be recognized over the period during which an employee is required to provide service in exchange for the award (the vesting period).
 
Income Taxes
 
The Company uses the liability method of accounting for income taxes as set forth in Statement of Financial Accounting Standards No. 109, “Accounting for Income Taxes.” Under the liability method, deferred taxes are determined based on the differences between the financial statement and tax basis of assets and liabilities at enacted tax rates in effect in the years in which the differences are expected to reverse.
 
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.
 
5

 
Loss per Share
 
The Company computes net loss per share in accordance with SFAS No. 128, “Earnings per Share” and SEC Staff Accounting Bulletin No. 98 (“SAB 98”). Under the provision of SFAS No. 128 and SAB 98 basic net loss per share is calculated by dividing net loss available to common stockholders for the period by the weighted average shares of common stock of the Company outstanding during the period. Diluted net loss per share is computed by dividing the net loss for the period by the weighted average number of common and common equivalent shares outstanding during the period. The calculation of fully diluted loss per share of common stock assumes the dilutive effect of stock options outstanding. During  a loss period, the assumed exercise of outstanding stock options has an anti-dilutive effect. Therefore, the outstanding stock options were not included in the September 30, 2009 and 2008 calculations of loss per share.
 
Use of Estimates
 
The preparation of financial statements in conformity with accounting principals generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported revenues and expenses during the reporting period. Actual results could differ significantly from those estimates.
 
Reclassifications
 
Certain reclassifications may have been made to the prior year financial statements to conform to the current period presentation.
 
Long-Lived Assets
 
Property, plant and equipment, including significant improvements, are stated at cost. Expenditures for maintenance and repairs are charged to operating expenses as incurred. When properties are retired or otherwise disposed of, the cost of the asset and the related accumulated depreciation are removed from the accounts with the resulting gain or loss being reflected in results of operations.
 
Management assesses the recoverability of property and equipment, goodwill, trademarks and other intangible assets whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable from its future undiscounted cash flows. If it is determined impairment has occurred, an impairment loss is recognized for the amount by which the carrying amount of the asset exceeds its estimated fair value.
 
New Accounting Standards
 
The Financial Accounting Standards Board (“FASB”) periodically issues new accounting standards in a continuing effort to improve standards of financial accounting and reporting. Management has reviewed the recently issued pronouncements and concluded that the following new accounting standards are potentially applicable to the Company.
 
In April 2009, the FASB issued Staff Position No. 141(R)-1, “Accounting for Assets Acquired and Liabilities Assumed in a Business Combination that Arise from Contingencies.” The Staff Position amends SFAS No. 141(R), “Business Combinations” to require an acquirer to recognize at fair value at acquisition date an asset acquired or liability assumed in a business combination that arises from a contingency if the acquisition date fair value of that asset or liability can be determined during the measurement period. The Staff Position is effective for business combinations with an acquisition date on or after December 15, 2008. The adoption of this standard did not have a material impact on the Company’s financial position, results of operations or cash flows.
 
In April 2009, the FASB issued Staff Position No. 157-4, “Determining Fair Value when the Volume and Level of Activity for the Asset or Liability Have Significantly Decreased and Indentifying Transactions that are not Orderly.” The Staff Position provides guidance for making fair value measurements more consistent with the principles presented in SFAS No. 157, “Fair Value Measurements.” The Staff Position relates to determining fair values when there is no active market or where the inputs being used represent distressed sales. The Staff Position is effective for interim and annual periods ending after September 15, 2009, but entities may early adopt the Staff Position for the interim and annual periods ending after March 15, 2009. The Company does not expect the adoption of this standard to have a material impact on its financial position, results of operations or its cash flows.
 
6


In April 2009, the FASB issued Staff Position No. 107-1 and APB 28-1, “Interim Disclosures about Fair Value of Financial Instruments.” The purpose of this Staff Position is to enhance consistency in financial reporting by increasing the frequency of fair value disclosures. The Staff Position relates to assets and liabilities that are not currently disclosed on the statement of financial position at fair value. These financial instruments are currently disclosed at fair value in the notes to the financial statements on an annual basis only. This Staff Position provides for these fair value footnote disclosures to be made at interim periods, also. The Staff Position is effective for interim and annual periods ending after September 15, 2009, but entities may early adopt the Staff Position for the interim and annual periods ending after March 15, 2009. The Company does not expect the adoption of this standard to have a material impact on its financial position, results of operations or its cash flows.
 
In April 2009, the FASB issued Staff Position No. 115-2 and 124-2, “Recognition and Presentation of Other-Than-Temporary Impairment.” The purpose of this Staff Position is to bring greater consistency to the timing of impairment recognition and greater clarity regarding disclosures to investors regarding the cash flows, credit losses and aging of securities with unrealized losses. The Staff Position is effective for interim and annual periods ending after September 15, 2009, but entities may early adopt the Staff Position for the interim and annual periods ending after March 15, 2009. The Company does not expect the adoption of this standard to have a material impact on its financial position, results of operations or its cash flows.
 
Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies are not expected to have a material impact on the Company’s financial position, results of operations or cash flows.
 
NOTE 2 - UNCERTAINTIES
 
The accompanying financial statements have been prepared assuming the Company will continue as a going concern. The Company is in the development stage and has not established sources of revenues to fund the development of business and pay operating expenses, resulting in a cumulative net loss of $(22,625,949) for the period from inception (August 16, 1996) to September 30, 2009. The ability of the Company to continue as a going concern during the next year depends on the successful completion of the Company’s capital raising efforts to fund the manufacturing of its retractable safety syringe and its color MRI technology. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
 
NOTE 3 – REV MED / GLOBE JOINT VENTURE AGREEMENT
 
On November 3, 2005, Rev Med (formerly known as 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. Rev Med and Globe each own 50% of the joint venture. Rev Med contributed its retractable safety syringe technology and Globe contributed its safety scalpel technology. In connection with the agreement, Rev Med issued restricted shares of its common stock, valued at $625,066, to Globe. Subsequent to December 31, 2006, the Company ended the joint venture and cancelled the shares of common stock and options that were issued to Globe pursuant to the agreement. On March 1, 2007, the Company filed a lawsuit in the District Court of Tulsa County, Oklahoma against Globe Med Tech, Inc. to rescind, terminate and seek monetary damages for the non-fulfillment and breach of a joint venture agreement entered into November 3, 2005 and other related agreements, in addition to an accounting of expenditures of funds under the terms and provisions of the agreements. On May 11, 2007, a partial default judgment against Globe was granted by the District Court of Harris County, Texas. The partial default judgment as to liability only was granted with respect to the Company’s causes of action against Globe for breach of contract, conversion and common law fraud with respect to the Company’s Original Petition and Application for Temporary and Permanent Injunctions against Globe on January 30, 2007. On August 13, 2007, the Company was granted a final default judgment for permanent injunctive relief and for damages in the amount of $14,029,000 against Globe. Globe has appealed the judgment. On November 23, 2007, the Court signed an order granting Globe’s Motion for New Trial and setting aside the Final Default Judgment entered in favor of the Company on August 13, 2007.
 
On October 29, 2008, the Company filed a lawsuit in the district court of Harris county Texas, a lawsuit for fraud and contempt of court for Globe Med Tech and Andy Hu individually. In response, Globe filed a motion to stay the lawsuit based upon the forum selection clause in the joint venture agreement between RMC and Globe which provides that the exclusive forum for all disputes relating to the Joint Venture Agreement shall be Oklahoma state court/Tulsa County. Due to the Texas state district’s court’s backlog of cases and the withdrawal of Globe and Andy Hu’s counsel, the motion to stay was not heard until May 1, 2009. The motion was granted as to Globe; however, Hu did not join in the motion and, after the May 1st hearing, filed a separate motion to stay, based upon the same grounds as Globe’s motion. Hu’s motion to stay was denied at a May 8th hearing. Accordingly, the Company intends to proceed post haste with discovery with respect to its claims against Hu, including without limitation obtaining the deposition of key witnesses.
 
7


NOTE 4 - OTHER COMMITMENTS AND CONTINGENCIES
 
Employment Agreement with Rondald Wheet, CEO
 
Effective March 31, 2008, the Company and Mr. Wheet, our CEO, entered into a three year employment agreement. The agreement provides for an annual salary of $225,000. As of September 30, 2009, the Company owed Mr. Wheet $76,474 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 all of his reasonable and necessary travel, entertainment or other related expenses incurred by him in carrying out his duties and responsibilities under the agreement. The Company will also provide him with a cell phone, suitable office space, and membership dues in professional organizations and for any seminars and conferences related to Company business.
 
Mr. Wheet may elect, by written notice to the Company, to terminate his employment with continued pay through the employment agreement term if (i) the Company sells all of its assets, (ii) the Company merges with another business entity with a change in control, (iii) more than 50% of the outstanding stock is acquired by a third party, (iv) the Company requires Mr. Wheet to relocate or assigns duties not commensurate with his position as CEO, (v) Mr. Wheet is removed from the Board of Directors and (vi) the Company defaults in making payments required to Mr. Wheet under this agreement. For two years following his resignation or termination, Mr. Wheet will not work for or provide any services in any capacity to any competitor and will not solicit any of the Company’s customers or accounts.
 
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 shares of common stock on or before April 14, 2010.  On May 6, 2009, the Company issued 666,828 shares with a value of $306,741 to completely extinguish this debt.
 
Amounts Due Pursuant to Employment and Consulting Agreements
 
The Company has accrued $761,599 pursuant to employment and consulting agreements which are in default. Although the Company plans to settle these amounts, there is no assurance that its efforts to settle will be successful. No litigation related to these agreements has been initiated or threatened. There is no assurance, however, that such litigation will not be initiated in the future.
 
Patent Applications for the Company’s RevVac Safety Syringe
 
The Company owns three (3) published patents on the vacuum technology on its RevVac safety syringe. In January 2009, a fourth patent for the RevVac safety syringe was issued by the U.S. patent office and published in April 2009 related to the Globe/Rev Med Joint Venture.  The Company also filed international patent protection rights regarding the RevVac Safety Syringe in the following countries: Australia, China, Japan, Taiwan, Mexico, Canada and several countries in Europe.
 
Revolutions Medical Patent Applications and License to Color MRI Technology
 
The Company owns four (4) separate patent applications, filed June 2007. There is no assurance that any patent protections will be secured. The lack of patent protection, whether foreign or domestic, could allow competitors to copy and sell products based on our designs without paying us a royalty, which could have a material adverse effect on the Company’s business.
 
In 1999, a former subsidiary of the Company, Clear Image, Inc., acquired an exclusive license to a color MRI technology from the University of South Florida Research Foundation (“USFRF”) based on patents issued in the early 1990’s.  In 2002, USFRF notified Clear Image that the license was terminated because Clear Image had not used its “best efforts”, an assertion which Clear Image disputed. Although the current stage of the Company’s technology uses color MRI technology, the Company believes that it is sufficiently separate from the technology licensed to it by USFRF to permit it to proceed regardless of the status of the license from USFRF. The Company believes that its color MRI technology does not rely on the license; however, the legal implications are uncertain.
 
Amounts Due to Consultants
 
In April 2009, the Company entered into a commitment with a third party who would obtain the breast biopsy and needle localization technology. The Company has paid $135,000 as of September 30, 2009 on expenses related to this technology.
 
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NOTE 5 - PREFERRED STOCK AND COMMON STOCK TRANSACTIONS
 
Series 2006 Preferred Stock
 
The Company has authorized 5,000,000 shares of its Series 2006 preferred stock, of which 1,000,000 shares are outstanding. All 1,000,000 outstanding shares of Series 2006 preferred stock are owned by Rondald L. Wheet, our Chairman, President and CEO. Because each share of Series 2006 preferred stock is entitled to 125 votes per share, Mr. Wheet has voting control of the Company with votes representing 125,000,000 common shares.
 
Voting Rights : A Series 2006 preferred stock holder is entitled to 125 votes for each share of common stock into which his Series 2006 Preferred Stock is then convertible (presently on a one for one basis), voting together with our common stock as a single class. Cumulative voting is not permitted. Upon conversion of each Series 2006 preferred share, each share of common stock issued will be entitled to only one (1) vote per common share.
 
A Series 2006 preferred stock holder is entitled to receive, ratably, dividends when, as and if declared by the board of directors out of legally available funds to pay dividends. If any dividend or other distributions are declared on our common stock, then a dividend or other distribution must also be declared on the outstanding Series 2006 preferred stock at the same time and on the same terms and conditions, so that each holder of Series 2006 preferred stock will receive the same dividend or distribution such holder would have received if the holder had converted his Series 2006 Preferred stock as of the record date for determining stockholders entitled to receive such dividend or distribution.
 
Liquidation Preference : In the event of the liquidation, dissolution or winding up, a Series 2006 preferred stock is entitled to receive a liquidation preference of $0.001 for each share of Series 2006 preferred stock held prior to payment being made to any junior stock.
 
Conversion : A Series 2006 preferred stock holder may convert one (1) share of preferred stock into one (1) share of common stock.
 
Preemption : A Series 2006 Preferred stock holder has no preemptive rights and is not subject to further calls or assessments.
 
Redemption : There are no redemption or sinking fund provisions applicable to the Series 2006 Preferred stock.
 
Blank Check Preferred Stock
 
The Company’s Articles of Incorporation authorize its board of directors to establish one or more additional series of preferred stock and to determine, with respect to any such series of preferred stock, its terms and rights, including: the designation of each series; the voting powers, if any, associated with each such series whether dividends, if any, will be cumulative or noncumulative and the dividend rate of each series; the redemption rights and price or prices, if any, for shares of each series; and preferences and other special rights, if any, of shares of each series in the event of any liquidation, dissolution, or distribution of the Company’s assets.
 
Common Stock Transactions for the Nine Months Ended September 30, 2009
 
During the nine months ended September 30, 2009, 4,451,250 shares of common stock were issued as option holders exercised their options to purchase common stock and 1,523,118 shares were issued to third party investors. The Company received proceeds of $349,700 in connection with these share issuances.
 
During the nine months ended September 30, 2009, the Company issued an additional 630,000 shares of common stock with a total value of $329,300 in lieu of cash as payment for outside services.
 
During the nine months ended September 30, 2009, the Company offered 2,982,000 shares at twenty-five cents per share under a stock subscription agreement and had raised $335,500 as of September 30, 2009. The offering was concluded during the fourth quarter and an additional total of $410,000 was during that time period representing a total of 1,640,000 shares.
 
NOTE 6 - STOCK OPTIONS AND WARRANTS OUTSTANDING
 
The following tables summarize information about the stock options outstanding at September 30, 2009:

   
Options
   
Weighted Average
Exercise Price
 
             
Balance at June 30, 2009
    10,072,500     $ 0.139  
Granted
           
Exercised
    (1,383,750 )     0.080  
Expired/Forfeited
           
BALANCE AT SEPTEMBER 30, 2009
    8,688,750     $ 0.127  
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ITEM 2.  MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 
Special Note Regarding Forward-Looking Statements
 
The following discussion should be read in conjunction with our financial statements and the notes thereto included elsewhere in this Form 10-Q. This Form 10-Q contains forward-looking statements regarding the plans and objectives of management for future operations. This information may involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by any forward-looking statements. Forward-looking statements, which involve assumptions and describe our future plans, strategies and expectations, are generally identifiable by use of the words “may,” “will,” “should,” “expect,” “anticipate,” “estimate,” “believe,” “intend” or “project” or the negative of these words or other variations on these words or comparable terminology. These forward-looking statements are based on assumptions that may be incorrect, and we cannot assure you that these projections included in these forward-looking statements will come to pass. Our actual results could differ materially from those expressed or implied by the forward-looking statements as a result of various factors. See “Quantitative And Qualitative Disclosures About Market Risk.”
 
Since 1997, we have been working to design, develop and commercialize retractable safety needle devices. Our present product development effort is focused on the RevVac retractable safety syringe, which is designed specifically to reduce accidental needle stick injuries. On February 6, 2007, the Company announced an agreement with Strategic Product Development, Inc. (“SPD”) to provide FDA regulatory compliance, manufacturing management capabilities and ongoing product development services. On March 5, 2007, the Company announced that SON Medical, a privately held contract regulatory and testing consulting firm located in the Boston area, was chosen to conduct lab testing for the Company’s RevVac retractable safety syringe. See “ Status Of Planned Products ” below.
 
On March 26, 2007, the Company completed the acquisition of the sole asset of Clear Image Acquisition Corporation (“Acquisition Corp”) pursuant to the Plan and Agreement of Reorganization of January 26, 2007. See Note 9 “Acquisition of Clear Image Acquisition Corp” to the consolidated financial statements for the year ended December 31, 2008 appearing in the Company’s Annual Report on Form 10-K for the year ended December 31, 2008, as filed with the Securities and Exchange Commission on September 30, 2009.
 
Because our planned products are in various stages of development and/or manufacturing, 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 and manufacturing of the RevVac retractable safety syringe and the Clear Image color MRI software. It could be months, if ever, before our planned products are sold in the United States or anywhere else in the world.
 
Status of Planned Products
 
On April 23, 2009, the Company announced that it had acquired the exclusive rights to license an FDA-approved breast biopsy localization system. The Company recently signed a worldwide exclusive license agreement with Strategic Product Development for an image-guided navigation system that incorporates high accuracy breast biopsies systems (“BSS”) to conventional mammography systems, which number more than 50,000 globally. This technology has already received 510K market clearance by the FDA. BSS facilitates accurate and fast non-palpable lesions and micro calcification localization in the treatment of breast cancer. It is a low-cost, standalone stereotactic image-based system which uses data from a pair of mammograms to enable radiologists to accurately position a localization needle or biopsy tool at the location of suspicious abnormalities. The system can also be modified to leverage existing popular biopsy tools. The technology can be used to provide a technology platform for future development, including multi-modal breast imaging for the image fusion of MRI and X-Ray images. The BSS will be modified to use Rev Med’s proprietary safety syringe technology as well. The Company believes that this technology has the potential to be deployed in the vast majority of more than 50,000 mammography machines that are currently in use worldwide, including more than 15,000 in the United States.
 
On February 22, 2009, the Company announced that it had received notification from the FDA that the 510K application for the Rev Vac Safety Syringe has been approved. Furthermore, FDA approval is not needed for educational and research use of our Rev Color and Rev 3D MRI software products. The Company plans on marketing these products for such use very soon. In December 2008, the Company filed for patent protection in Europe on its Rev Color and Rev 3D software.
 
The Rev Vac Safety Syringe uses vacuum technology to suck the needle into the plunger after use. The syringe cannot be reused once the vacuum is activated. Rev Med believes its safety syringe has many advantages over its competition including price, ease of use, and safety. It should help reduce accidental needle stick injuries and also aid in reducing the spread of contagious diseases. You may view a video of the syringe in use on our website at www.revolutionsmedical.com. The Company also believes that with the help of government regulation initiatives, individual state laws, and the importance of world health concerns, the safety syringe market will continue to have substantial growth into the foreseeable future.
 
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When an MRI is taken, the images are sent to a pictorial archival computer systems (“PACS”), which displays the images for a radiologist to view. RevMed has hired and announced Strategic Product Development (“SPD”) to be its project design consultant for the purpose of implementing the RevColor MRI software (including 3-D and automatic segmentation) on a PACS delivery platform and has given approval for SPD to enter into a binding letter of intent with Cambridge Medical Information Corporation (“CMIC”) to use their PACS delivery platform, known as zPACS, which is an advanced fully functional PACS system currently in operation at several major international hospitals. The estimated cost of this project is $400,000, which RevMed is working to raise. A video of the MRI software can be found on the Company’s website.
 
Liquidity, Capital Resources and Cash Requirements
 
The following discussion of our cash requirements and liquidity and resources contains forward-looking statements that are based upon current expectations. These forward-looking statements fall within the meaning of the federal securities laws that relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “intend,” “potential” or “continue” or the negative of these terms or other comparable terminology. Forward-looking statements involve risks and uncertainties. Our actual results and the timing of events could differ materially from those anticipated in our forward-looking statements as a result of many factors; including, our ability to obtain financing when needed. A discussion of these risks and uncertainties can be found under the heading “ 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.
 
Liquidity and Capital Resources and Cash Requirements
 
As of September 30, 2009, the Company did not have and continues to not have sufficient cash to pay present obligations as they become due. We are searching for additional financing to generate the liquidity necessary to continue our operations. Due to current economic conditions and the Company’s risks and uncertainties, there is no assurance that we will be able to raise any additional capital on acceptable terms, if at all. Because of these uncertainties, the auditors have expressed substantial doubt about our ability to continue as a going concern.  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.
 
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 33,147,891 shares were issued and outstanding as of September 30, 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.
 
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 
We do not hold any derivative instruments and do not engage in any hedging activities.
 
ITEM 4. CONTROLS AND PROCEDURES

Pursuant to rules adopted by the SEC as directed by Section 302 of the Sarbanes-Oxley Act of 2002, the Company's management, with the participation of the CEO/CFO, evaluated the effectiveness of the Company's disclosure controls and procedures (as defined in the Securities Exchange Act of 1934 Rules13a-15(e)) as of June 30, 2009. Based on that evaluation, the Company's CEO/CFO concluded that, as of that date, the Company's disclosure controls and procedures required by paragraph (b) of Exchange Act Rules 13a-15 or 15d-15, were not effective based on identified material weaknesses.  Management's assessment identified the following material weaknesses:
 
 
-
As of September 30, 2009, there was a lack of accounting personnel with the requisite knowledge of Generally Accepted Accounting Principles (“GAAP”) in the US and the financial reporting requirements of the Securities and Exchange Commission.
     
 
-
As of September 30, 2009, there were insufficient written policies and procedures to insure the correct application of accounting and financial reporting with respect to the current requirements of GAAP and SEC disclosure requirements.
     
 
-
As of September 30, 2009, there was a lack of segregation of duties, in that we limited resources 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 also disclosed these weaknesses in our Form 10-K filed on March 31, 2009. 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.
 
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PART II - OTHER INFORMATION
 
ITEM 1.  LEGAL PROCEEDINGS
 
On March 1, 2007, the Company filed a lawsuit in the District Court of Tulsa County, Oklahoma against Globe Med Tech, Inc. ("Globe") to rescind, terminate and seek monetary damages for the non-fulfillment and breach of a joint venture agreement entered into November 3, 2005 and other related agreements, in addition to an accounting of expenditures of funds under the terms and provisions of the agreements. On May 11, 2007, a partial default judgment against Globe was granted by the District Court of Harris County, Texas. The partial default judgment as to liability only was granted with respect to the Company's causes of action against Globe for breach of contract, conversion and common law fraud with respect to the Company's Original Petition and Application for Temporary and Permanent Injunctions against Globe on January30, 2007. On August 13, 2007, the Company was granted a final default judgment for permanent injunctive relief and for damages in the amount of $14,029,000 against Globe. Globe has appealed the judgment. On November 23, 2007, the Court signed an order granting Globe's Motion for New Trial and setting aside the Final Default Judgment entered in favor of the Company on August 13, 2007.

On October 29, 2008, the Company filed a lawsuit in the district court of Harris county Texas, a lawsuit for fraud and contempt of court for Globe Med Tech and Andy Hu individually. In response, Globe filed a motion to stay the lawsuit based upon the forum selection clause in the joint venture agreement between RMC and Globe which provides that the exclusive forum for all disputes relating to the Joint Venture Agreement shall be Oklahoma state court/Tulsa County. Due to the Texas state district’s court’s backlog of cases and the withdrawal of Globe and Hu’s counsel, the motion to stay was not heard until May 1, 2009. The motion was granted as to Globe; however, Hu did not join in the motion and, after the May 1st hearing, filed a separate motion to stay, based upon the same grounds as Globe’s motion. Hu’s motion to stay was denied at a May 8th hearing. Accordingly, RMC intends to proceed with discovery with respect to its claims against Hu, including without limitation obtaining the deposition of key witnesses.
 
ITEM 1A.  RISK FACTORS
 
We believe there are no changes that constitute material changes from the risk factors previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2008, filed with the Securities and Exchange Commission on March 31, 2009.
 
ITEM 2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
 
Equity transactions for the six months ended September 30, 2009 are incorporated herein by reference to Part I- Financial Information - Notes to Financial Statements - Note 5. “Preferred Stock and Common Stock Transactions.”
 
ITEM 3.  DEFAULT UPON SENIOR SECURITIES
 
There were no defaults upon senior securities during the period ended September 30, 2009.
 
ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
 
There were no matters submitted for a vote of our security holders during the period ended September 30, 2009.
 
ITEM 5.  OTHER INFORMATION

 
There is no other information required to be disclosed under this item which was not previously disclosed.
 
ITEM 6.  EXHIBITS
 
Exhibits No.  
   
31.1  Certification Pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 302 of 2002
   
31.2   Certification Pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 302 of 2002
   
32.1   Certification Pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
   
32.2   Certification Pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
 
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SIGNATURES
 
In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

     
   
REVOLUTIONS MEDICAL CORPORATION
     
   
/s/ Rondald L. Wheet
   
Rondald L. Wheet
   
Chief Executive Officer
 
Date: March 10, 2010
 
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