Item 8.01 Other Information.
In December 2002, Save the World Air, Inc. (the Company) retained the RAND Corporation
(RAND) to study the scientific validity and market potential of its original ZEFS technology,
help it develop a plan to assess the technical basis for our ZEFS technology and understand the
potential market for products incorporating the ZEFS technology if a technical basis were
established. RAND outlined a research and evaluation program for the Company to examine the
theoretical basis of the ZEFS device and to test the impact of the device when installed on
vehicles.
In early 2003, RAND determined that a comprehensive product-testing program was warranted. As
a result, in May 2003, the Company entered into an arrangement under which RAND coordinated and
supervised both a theoretical scientific study of the concepts underlying our ZEFS technology, as
well as an empirical study. The scope of RANDs work was limited to testing the ZEFS technology as
to its effect on emissions reductions and did not evaluate the effect of the ZEFS technology on
performance enhancement or fuel economy. In response to a request for proposal that RAND sent to
14 universities in the United States, Temple University in Philadelphia, Pennsylvania was chosen to
research the Companys ZEFS technology. Temples research of the ZEFS technology concluded in early
2005.
RANDs other activities on the Companys behalf concluded in December 2005. Further
development of the Companys technologies continued. In 2006, the MK IV technology was first
developed and enhancements have continued into early 2007. The Company submitted to RAND additional
test results from the MK technology conducted in January 2007 at Olson Ecologic Labs in Fullerton,
California, on three separate motorcycles of differing displacements to demonstrate the
effectiveness of more current versions of the Companys technology. For purposes of its report,
RAND did not consider these results in its study as its fieldwork and report had been completed.
On April 27, 2007, RAND issued its final report, entitled An Approach to Assessing the
Technical Feasibility and Market Potential of a New Automotive Device. RAND opined that the
application of magnetic fields has not been shown in scientific literature to lower the viscosity
of automotive fuels. RAND concluded, among other things, that the Company would need to conduct
further laboratory studies and in-use testing to determine the effectiveness of the ZEFS technology
in reducing pollutants and increasing fuel efficiency in gasoline and diesel-powered vehicles.
RANDs analysis of the laboratory testing data which had previously been undertaken for the
Company found at best mixed results from these tests, and therefore RAND could not confirm the
effectiveness of the ZEFS technology in actual use. In its analysis, RAND did not rely on the
recent additional test results conducted at Olson Ecologic Labs. The RAND report said the existing
technical literature does not contain credible reports that the application of magnetic fields to
either gasoline or diesel fuel oil will reduce the viscosities of these automotive fuels.
Researchers at Temple University, who were funded by the Company as a result of a competitive
grants process administered by RAND, have reported findings indicating a potential connection
between magnetic fields and fuel viscosity. However, RAND reported that such laboratory work has
not yet been independently reviewed and published by the Temple University research team, and it
does not settle the issue of how magnetic fields might affect actual engine performance.
RAND concluded that the market potential for products incorporating the ZEFS technology will
depend significantly on demonstrating positive results from the Companys technology, competition
posed by other technologies, and regulatory policies and cost-effectiveness to other alternatives.
The Company notes that RAND tested the Companys original ZEFS technology as to its effect on
emissions reduction only and not performance enhancement or fuel economy. Versions of the ZEFS
technology studied by RAND are not being marketed by the Company as emissions reduction products.
The Company believes that a reassessment and redesign of its products intended to improve the
consistency of third-party test results led to the development and evolution of products
incorporating its current emissions reduction technology, MK IV, which has taken place since the
completion of RANDs fieldwork. The Company further believes that these newer iterations of the
Companys technologies have performed
more consistently in testing at independent labs since the completion of RANDs fieldwork.
The MK IV technology has also undergone independent testing, which the Company believes shows
significant improvement when compared to the original ZEFS technology.
Item 9.01 Financial Statements and Exhibits
Exhibit 99.1 Press Release dated May 3, 2007.