As filed with the Securities and Exchange Commission on July 23, 1996

Registration No. 333-3184

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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

AMENDMENT NO. 3

TO
FORM SB-2

REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
_____________________

MEDJET INC.
(Name of small business issuer in its charter)

DELAWARE 3841 22-3283541
(State or jurisdiction (Primary Standard (IRS Employer
of incorporation Industrial Identification No.)
or organization) Classification
Code Number)

1090 KING GEORGES POST ROAD, SUITE 301
EDISON, NEW JERSEY 08837
(908) 738-3990
(908) 738-3984 (FAX)

(Address and telephone number of principal executive offices and principal place
of business)

EUGENE I. GORDON
PRESIDENT
MEDJET INC.
1090 KING GEORGES POST ROAD, SUITE 301
EDISON, NEW JERSEY 08837
(908) 738-3990
(908) 738-3984 (FAX)

(Name, address and telephone number of agent for service)

Please send a copy of all communications to:
JANE E. JABLONS, ESQ. STUART NEUHAUSER, ESQ.
KELLEY DRYE & WARREN LLP BERNSTEIN & WASSERMAN, LLP
101 PARK AVENUE 950 THIRD AVENUE
NEW YORK, NEW YORK 10178 NEW YORK, NEW YORK 10022
(212) 808-7800 (212)826-0730
(212) 808-7897 (FAX) (212)371-4730 (fax)

APPROXIMATE DATE OF PROPOSED SALE TO THE PUBLIC: As soon as practicable
after the effective date of this Registration Statement.

If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the offering. [ ] _____

If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ] ____

If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]

If any of the Securities being registered on this Form are to be offered on
a delayed or continual basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. [ X ]

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CALCULATION OF REGISTRATION FEE

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Proposed Proposed
Maximum Maximum
Title of Each Class Offering Price Aggregate Amount of
of Securities Dollar Amount Per Security Offering Registration
Being Registered to Be Registered (1) Price (1) Fee (1)(4)
- ------------------- ---------------- --- --------- ------------
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Units, each consisting
of one share of Common
Stock and one $6,900,000(3) $5.60 $6,900,000 $2,379.31
Class A Warrant
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Common Stock,
par value
$.001 per share, -- -- -- --
included in the Units
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Class A Warrants
included in the Units -- -- -- --
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Common Stock
underlying $12,321,430(3) $10.00 $12,321,430 $4,248.77
Class A Warrants (2)
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Underwriter's Options $107.14 $.001 $107.14 $.04
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Units underlying
Underwriter's Options $720,000.96 $6.72 $720,000.96 $248.28
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Common Stock
included in Units
underlying -- -- -- --
Underwriter's Options
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Class A Warrants
included in Units
underlying -- -- -- --
Underwriter's Options
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Common Stock
underlying Warrants
included in Units
underlying
Underwriter's
Options $1,071,430 $10.00 $1,071,430 $369.46
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Total Registration Fee $21,012,968.10 $21,012,968.10 $7,245.86
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-ii-

(1) Estimated solely for the purpose of computing the amount of the
registration fee pursuant to Rule 457 of the Securities Act.

(2) Pursuant to Rule 416, there are also being registered hereby such
additional indeterminate number of shares of Common Stock as may become
issuable by reason of stock splits, stock dividends, anti-dilution
adjustments and similar adjustments as set forth in the provisions of the
Warrants and the Underwriter's Option Agreement.

(3) Includes 160,714 Units subject to the Underwriter's over-allotment option.

(4) Fee of $9,641.43 was previously paid.

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THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.

-iii-

MEDJET INC.

CROSS-REFERENCE SHEET

Form SB-2 Item Number and Caption Heading in Prospectus
- --------------------------------- ---------------------

1. Front of Registration Statement and Outside Front
Cover of Prospectus. . . . . . . . . . . . . . . . . . Outside Front Cover of Prospectus

2. Inside Front and Outside Back Cover
Pages of Prospectus. . . . . . . . . . . . . . . . . . Inside Front and Outside Back Cover Pages of Prospectus

3. Summary Information and Risk Factors . . . . . . . . . Prospectus Summary; Risk Factors

4. Use of Proceeds. . . . . . . . . . . . . . . . . . . . Use of Proceeds

5. Determination of Offering Price. . . . . . . . . . . . Risk Factors; Underwriting

6. Dilution . . . . . . . . . . . . . . . . . . . . . . . Dilution; Risk Factors

7. Selling Security Holders . . . . . . . . . . . . . . . Not Applicable

8. Plan of Distribution . . . . . . . . . . . . . . . . . Outside Front Cover Page of Prospectus; Underwriting

9. Legal Proceedings. . . . . . . . . . . . . . . . . . . Business

10. Directors, Executive Officers, Promoters and
Control Persons. . . . . . . . . . . . . . . . . . . . Risk Factors; Management

11. Security Ownership of Certain Beneficial Owners
and Management . . . . . . . . . . . . . . . . . . . . Principal Stockholders

12. Description of Securities. . . . . . . . . . . . . . . Description of Securities

13. Interests of Named Experts and Counsel . . . . . . . . Legal Matters; Experts

14. Disclosure of Commission Position on
Indemnification for Securities Act Liabilities . . . . Description of Securities

15. Organization Within Last Five Years. . . . . . . . . . Business; Certain Transactions

16. Description of Business. . . . . . . . . . . . . . . . Business

17. Management's Discussion and Analysis or Plan of
Operation. . . . . . . . . . . . . . . . . . . . . . . Plan of Operation

18. Description of Property. . . . . . . . . . . . . . . . Prospectus Summary; Risk Factors; Plan of Operation; Business

19. Certain Relationships and Related Transactions . . . . Certain Transactions

20. Market for Common Equity and Related Stockholder
Matters. . . . . . . . . . . . . . . . . . . . . . . . Risk Factors; Dilution; Management; Shares Eligible for Future Sale

21. Executive Compensation . . . . . . . . . . . . . . . . Management

22. Financial Statements . . . . . . . . . . . . . . . . . Financial Statements

23. Changes In and Disagreements with Accountants
on Accounting and Financial Disclosure . . . . . . . . Not Applicable

-iv-

SUBJECT TO COMPLETION, DATED JULY 23, 1996

PROSPECTUS

MEDJET INC.
1,071,429 Units
Each Unit Consisting of One Share of Common Stock
and One Class A Redeemable Common Stock Purchase Warrant

----------------------------
Medjet Inc., a Delaware corporation (the "Company"), hereby offers
1,071,429 Units (the "Units") for sale (the "Offering"). Each Unit consists of
one share of common stock, $.001 par value (the "Shares" or "Common Stock") and
one redeemable Common Stock Purchase Warrant (the "Class A Warrants" or the
"Warrants") to purchase one share of Common Stock at $10.00 for 24 months
commencing on the date that is three months following the date of this
Prospectus (the "Effective Date"). The Common Stock and the Class A Warrants
will become separable on the date (the "Separation Date") which is the earlier
of three months following the Effective Date or such earlier date as may be
agreed to by the Company and the Underwriter. The Units, Common Stock and
Warrants are sometimes collectively referred to as the "Securities."

The Units, Common Stock and Warrants will be separately transferable
commencing on the Separation Date. All of the Units offered hereby are being
sold by the Company. The Company is in the development stage and has not yet
sold any products or generated any revenues. The Company believes that it will
require additional capital before it reaches profitability, of which there can
be no assurance.

The Company has applied for the inclusion of the Securities on the National
Association of Securities Dealers ("NASD") OTC Bulletin Board, an unorganized,
inter-dealer, over-the-counter market which provides significantly less
liquidity than the Nasdaq National Market System, and quotes for stocks included
on the OTC Bulletin Board are not listed in the financial sections of newspapers
as are those for the Nasdaq National Market System. In the event the Securities
are not included on the OTC Bulletin Board, quotes for the Securities may be
included in the "pink" sheets for the over-the-counter market. While the
Company has applied for inclusion of its Securities on the Nasdaq SmallCap
Market ("Nasdaq"), the application was denied by the Nasdaq staff. The Company
has appealed the Nasdaq staff decision. See "Risk Factors -- No Assurance of
Public Trading Market; Denial of Nasdaq Listing." (TEXT FOLLOWS ON NEXT PAGE)

THE SECURITIES OFFERED HEREBY INVOLVE A HIGH DEGREE OF RISK AND IMMEDIATE
SUBSTANTIAL DILUTION. SEE "RISK FACTORS" BEGINNING ON PAGE 9 AND "DILUTION."

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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

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UNDERWRITING
PRICE TO DISCOUNTS AND PROCEEDS TO
PUBLIC COMMISSIONS(1) COMPANY(2)
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Per Unit . . . . $5.60 $.56 $5.04
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Total (3). . . . $6,000,002 $600,000.20 $5,400,001.80
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(FOOTNOTES FOLLOW ON NEXT PAGE)

The Units are being offered when, as and if delivered to and accepted by
the Underwriter and subject to certain conditions, including the right to reject
orders in whole or in part. It is anticipated that delivery of the Units will
be made against payment therefor on or about , 1996 at the offices of
--------
the Underwriter.

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PATTERSON TRAVIS, INC.

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The date of this Prospectus is , 1996.
----------------------

(TEXT CONTINUED FROM PREVIOUS PAGE)
The Warrants are redeemable by the Company for $.01 per warrant on 30 days'
prior written notice, if the market price of the Common Stock equals or exceeds
$13.00 for any 10 consecutive trading days within a period of 30 trading days
ending within five days prior to the date of the notice of redemption. See
"Description of Securities -- Warrants." Prior to this Offering, there has been
no public market for the Units, the Common Stock or the Warrants, and there can
be no assurance that a public market will develop. The initial public offering
price of the Units has been arbitrarily determined by agreement between the
Company and the Underwriter and is not related to the Company's earnings,
assets, book value or any other established criteria of value. See "Risk
Factors" and "Underwriting."

(FOOTNOTES CONTINUED FROM PREVIOUS PAGE)
(1) Does not include additional compensation to the Underwriter, including
(i) options (the "Underwriter's Options") to purchase 107,143 Units at
an exercise price of $6.72 per Unit for a period of four years,
commencing one year from the date of this Prospectus, each unit
consisting of one share of Common Stock and one redeemable Common
Stock Purchase Warrant and (ii) a non-accountable expense allowance of
$180,000. The Company has also agreed to indemnify the Underwriter
against certain liabilities, including liabilities under the
Securities Act of 1933, as amended (the "Securities Act"). See
"Underwriting."
(2) Before deducting expenses (including legal, accounting and filing fees
and printing and engraving) payable by the Company, estimated at
$337,000, excluding the non-accountable expense allowance to the
Underwriter referred to above.
(3) The Company has granted to the Underwriter an option, exercisable for
a period of 30 days from the date of this Prospectus, to purchase up
to 160,714 additional Units to cover over-allotments. If this option
is exercised in full, the total price to public will be $6,900,000,
the total Underwriting Discounts and Commissions will be approximately
$690,000 and the total proceeds to Company will be approximately
$6,210,000.

-2-

AVAILABLE INFORMATION

The Company has filed with the Securities and Exchange Commission (the
"Commission") a Registration Statement on Form SB-2 (together with all
amendments thereto, the "Registration Statement") under the Securities Act with
respect to the Securities offered by this Prospectus. This Prospectus does not
contain all of the information set forth in the Registration Statement and the
exhibits filed therewith, certain portions of which have been omitted as
permitted by the rules and regulations of the Commission. For further
information with respect to the Company and the Securities offered hereby,
reference is hereby made to the Registration Statement and to the exhibits filed
therewith. Statements contained in this Prospectus regarding the contents of
any contract or other document referred to are not necessarily complete and, in
each instance, reference is made to the copy of such contract or other document
filed as an exhibit to the Registration Statement, each such statement being
deemed to be qualified in its entirety by such reference. However, all material
elements of each such contract or other document are set forth in this
Prospectus. The Registration Statement, including all exhibits thereto, may be
inspected without charge at the principal office of the Commission at Judiciary
Plaza, 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549, and at the
Commission's regional offices located at Northwestern Atrium Center, 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661-2511 and at Seven World
Trade Center, 13th Floor, New York, New York 10048. Copies of such material may
be obtained from the Public Reference Section of the Commission at 450 Fifth
Street, N.W., Room 1024, Washington, D.C. 20549, upon the payment of prescribed
fees.

SPECIAL STANDARDS FOR UNITS SOLD IN CALIFORNIA

EACH CALIFORNIA INVESTOR, AND EACH TRANSFEREE THEREOF WHO ALSO IS A
CALIFORNIA INVESTOR, MUST HAVE AN ANNUAL GROSS INCOME OF AT LEAST $65,000 AND
A NET WORTH, EXCLUSIVE OF HOME, FURNISHINGS AND AUTOMOBILES, OF AT LEAST
$250,000, OR IN THE ALTERNATIVE, A NET WORTH, EXCLUSIVE OF HOME, FURNISHINGS AND
AUTOMOBILES, OF AT LEAST $500,000. IN ADDITION, AN INVESTOR'S TOTAL PURCHASE
MAY NOT EXCEED 10% OF SUCH INVESTOR'S NET WORTH.

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IN CONNECTION WITH THIS OFFERING, THE UNDERWRITER MAY EFFECT TRANSACTIONS
WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE UNITS, THE COMMON STOCK AND
THE WARRANTS AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN
MARKET. SUCH TRANSACTIONS MAY BE EFFECTED ON THE NASDAQ SMALLCAP MARKET. SUCH
STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.

-3-

PROSPECTUS SUMMARY

THE FOLLOWING IS A SUMMARY OF CERTAIN INFORMATION CONTAINED IN THIS
PROSPECTUS AND IS QUALIFIED IN ITS ENTIRETY BY THE DETAILED INFORMATION AND
FINANCIAL STATEMENTS, INCLUDING THE NOTES THERETO, APPEARING ELSEWHERE IN THIS
PROSPECTUS. UNLESS OTHERWISE INDICATED, THE INFORMATION IN THIS PROSPECTUS (I)
ASSUMES THAT THE INITIAL PUBLIC OFFERING PRICE FOR THE UNITS WILL BE $5.60, (II)
ASSUMES NO EXERCISE OF THE UNDERWRITER'S OVER-ALLOTMENT OPTION AND (III) HAS
BEEN ADJUSTED TO REFLECT A 1.987538926-FOR-1 STOCK SPLIT OF THE COMPANY'S COMMON
STOCK EFFECTED IMMEDIATELY PRIOR TO THE DATE OF THIS PROSPECTUS. SEE
"DESCRIPTION OF SECURITIES." UNLESS OTHERWISE INDICATED, NO EFFECT IS GIVEN IN
THIS PROSPECTUS TO (I) THE SHARES OF COMMON STOCK RESERVED FOR ISSUANCE UPON THE
EXERCISE OF THE WARRANTS INCLUDED IN THE UNITS, (II) THE SHARES OF COMMON STOCK
RESERVED FOR ISSUANCE UPON THE EXERCISE OF OPTIONS GRANTED TO THE UNDERWRITER
FOR NOMINAL CONSIDERATION AND THE WARRANTS INCLUDED THEREIN OR (III) THE SHARES
OF COMMON STOCK RESERVED FOR ISSUANCE PURSUANT TO THE COMPANY'S STOCK OPTION
PLAN. SEE "DESCRIPTION OF SECURITIES," "UNDERWRITING" AND "MANAGEMENT -- 1994
STOCK OPTION PLAN." FOR DEFINITIONS OF CERTAIN TERMS AND ABBREVIATIONS USED IN
THIS PROSPECTUS, SEE THE "GLOSSARY" AT PAGE 49.

THE COMPANY

Medjet Inc. (the "Company"), founded in December 1993, has developed a
proprietary surgical device known as a keratome, which utilizes a hair-thin
(approximately 30 microns in diameter) circular beam of supersonic velocity
water. The waterjet beam substitutes for a conventional metal or diamond blade
scalpel and in combination with other elements of the device is capable of
shaving thin, shaped layers from the cornea of the eye, a procedure known as
lamellar keratoplasty. The keratome is used to treat diseases of the cornea as
well as to correct vision deficiencies such as nearsightedness ("myopia"),
farsightedness ("hyperopia") and astigmatism by excising layers, either parallel
or shaped, of the cornea in order to reshape the cornea to achieve proper
focusing. In combination with a template of prescribed dimensions, the shape of
the layer to be removed can be determined in advance.

The Company believes that its keratome can be used to treat corneal disease
in a procedure known as hydro-therapeutic keratoplasty ("HTK"), in which
diseased corneal tissue is removed and the remaining corneal tissue may be
reshaped to provide proper focusing. About 45,000 corneal procedures, including
full transplants and partial removals, are performed annually in the United
States. The Company believes that the same keratome, through a procedure known
as hydro-refractive keratoplasty ("HRK"), has the potential to reduce or
eliminate a patient's dependence on eyeglasses or contact lenses by modifying
the shape of the cornea to correct vision deficiencies. Based upon feasibility
studies and limited animal testing conducted by the Company, the Company
believes that its waterjet scalpel cuts more precisely and smoothly than the
sharpest metal, diamond or laser scalpel and that, as a result, HRK may result,
if approved, in a safer, more accurate and more stable corneal adjustment that
is less painful for patients than other refractive surgical procedures currently
available. The Company anticipates that HRK will also be competitively priced
with, or cost less than, such other procedures. The Company has not
independently tested competing products but has reviewed research reports and
offering materials describing various competitive products.

Due to funding limitations, the Company has not yet constructed a full
prototype of its keratome or conducted tests of either the HRK or HTK procedures
using its keratome. The Company believes that limited testing of HRK and/or HTK
procedures using a keratome similar to the Company's has been done by others.

The Company's keratome, which consists of a waterjet nozzle and a device
known as a globe fixation device (to align and fix the eye in place relative to
the template during surgery), is intended to be used with a miniature high
pressure water storage element and related equipment, which together produce the
water beam; a scanning mechanism to move the water beam across the cornea; a
device to regulate and control the action of the water beam; a force transducer
to monitor the water beam status; and a template designed to support and shape
the eye during surgery. The keratome will be placed on the patient's eye during
the surgical procedure.

The Company intends to initially seek a ruling from the United States Food
and Drug Administration ("FDA") to market the HTK Keratome for two intended
uses, the removal of the epithelium and the removal of

-4-

diseased corneal tissue on the basis of substantial equivalence to devices in
use (referred to herein as "permission to market"). The HTK Keratome is
intended to become the first commercially available product using the Company's
waterjet technology and would be both an early source of income for the Company
and the basis for additional applications for FDA-permitted uses of the
keratome.

The subsequent and possibly more commercially valuable use of the keratome
is for refractive surgery through HRK. Subsequent to the permitted marketing of
the HTK Keratome, the Company intends to seek FDA permission to market the
keratome for HRK (the "HRK Keratome"). In the United States, more than 145
million people wear either eyeglasses or contact lenses. Over $13 billion is
spent annually in the United States for corrective eyewear products.
Approximately 29 million Americans wear contact lenses, primarily for cosmetic
or convenience reasons. The number of people in the United States newly
electing to wear contact lenses is over one million per year. This large and
growing population of contact lens wearers is the largest potential market for
refractive surgery, including HRK. Studies indicate that approximately 60% of
persons electing refractive surgery are contact lens wearers. However, there
can be no assurance that eyeglass or contact lens wearers will elect to undergo
surgery.

Upon regulatory permission to market, or other approval of, the HRK
Keratome (of which there can be no assurance), the Company intends to market the
HRK Keratome to individual ophthalmologists and groups of ophthalmologists for
the treatment of patients in a clinical setting. The Company believes that its
proprietary waterjet technology may have additional surgical applications;
however, the Company has conducted only limited studies of such applications to
date.

The Company has sought to protect its proprietary interest in the HRK
Keratome by applying for patents in the United States and corresponding patents
abroad. In September 1994, a U.S. patent application was filed in the name of
Dr. Eugene I. Gordon, President of the Company, and two employees of the
Company, as inventors, which application was assigned to the Company. The U.S.
patent application, as allowed for issuance, covers a method and device for use
in the HRK Keratome, including use of a template for corneal shaping and
holding, during use of a waterjet keratome device. A corresponding
international application has been filed, pursuant to the Patent Cooperation
Treaty ("PCT"), with designation of all member countries foreign to the United
States, including but not limited to Japan, the members of the European Patent
Office, Canada, Mexico, Australia, Russia, China and Brazil. The PCT filing has
been published and separate patent applications have been or will be filed
pursuant to the PCT filing. In addition, for countries not currently part of
the PCT, patent applications have also been filed in Israel, Taiwan and South
Africa. A U.S. patent application is currently pending and relates to
topographic corneal mapping, which has utility for surgery utilizing the HRK
Keratome.

The Company is in the development stage and has not sold any products or
generated any revenues as of the date of this Prospectus. To date, the
Company's research and development activities have been limited to constructing
and testing experimental versions of the keratome and conducting a limited
number of feasibility studies using porcine, rabbit and human cadaver eyes and
live animals to prove that a hair-thin beam of water can smoothly incise and
shape the anterior surface of the cornea and that the cornea will heal properly
after the surgery. No human clinical trials have been performed to date.

-5-

the Company believes the potential market could be significant, is for
refractive surgical correction. Therefore, the later phase of the Company's FDA
strategy relates to the HRK Keratome. Although the Company believes that the
HRK Keratome will be considered for permission to market by the FDA through a
510(k) notification based upon the similarities of the keratome between HTK use
and HRK use, obtaining such permission for the HRK Keratome is likely to be
somewhat more complicated than for HTK. There can be no assurance that either
the HTK use or the HRK use will be permitted for marketing by the FDA. The
differences between the two uses are found in the components, other than the
waterjet scalpel, which comprise the keratome. For the HRK Keratome, the
Company may be required to show that the procedure is effective, stable and does
not decrease visual acuity to any significant extent.

The Company believes that, based on three features of the HRK Keratome, it
will also be considered for 510(k) notification by the FDA. First, there are no
known or anticipated physical or chemical processes that would impact on the
safety of the HRK procedure. The second feature is the benign nature of the
waterjet cut compared with cuts from other types of scalpels. Third, the
portion of the corneal tissue targeted for removal by the HRK Keratome is
extracted in a single piece similar to a contact lens and the Company believes
that its proposed method of extraction and testing would be compatible with a
510(k) notification process that would be relatively short and consist of tests
on a limited number of live eyes.

The Company may distribute its products internationally. Distribution of
the Company's products in countries other than the United States may be subject
to regulation in those countries. In some countries, the regulations governing
such distribution are less burdensome than in the United States and the Company
may pursue marketing its products in such countries prior to receiving
permission to market from the FDA. The Company will endeavor to obtain the
necessary government approvals in those foreign countries where the Company
decides to manufacture, market and sell its products. See "Business -- Foreign
Government Regulation."

With the net proceeds of this Offering, the Company intends to continue the
research and development of its keratome and related manufacturing processes and
to commence human clinical trials of the HRK Keratome. See "Plan of Operation."
If the HTK Keratome or the HRK Keratome is permitted for marketing or otherwise
approved in the United States, the Company will be required to establish a
marketing organization and production facilities, which will require additional
financing. No assurance can be given that the Company's research and
development efforts will be successfully completed, that the HTK Keratome or HRK
Keratome will prove to be safe and effective in correcting vision, that the HTK
Keratome or HRK Keratome will be permitted for marketing by the FDA or any other
regulatory agency, or that the HTK Keratome or HRK Keratome or any other product
developed by the Company will be commercially successful.

The Company was incorporated under the laws under the State of Delaware in
December 1993. Its offices are located at 1090 King Georges Post Road, Suite
301, Edison, New Jersey 08837; its telephone number is (908) 738-3990. The
Company has elected Subchapter "S" status pursuant to Section 1362 of the
Internal Revenue Code of 1986, as amended (the "Code"), which status will
terminate upon the Closing Date.

THE OFFERING

Securities Offered . . . . 1,071,429 Units at $5.60 per Unit, each Unit
consisting of one share of Common Stock and one
Warrant. The shares of Common Stock and Warrants
offered as Units become detachable and separately
transferable on the date (the "Separation Date")
which is the earlier of three months following the
date of this Prospectus (the "Effective Date") or
such earlier date as may be agreed to by the
Company and the Underwriter. See "Description of
Securities."

-6-

Warrants . . . . . . . . . The Warrants will be exercisable at $10.00 per
share for 24 months commencing on the date which
is three months following the Effective Date,
which period may be extended by mutual agreement
between the Company and the Underwriter. The
Warrants will be redeemable at $.01 per Warrant if
the market price of the Common Stock equals or
exceeds $13.00 for 10 consecutive trading days
within a period of 30 consecutive trading days
ending within 5 days of the notice of redemption.
See "Description of Securities -- Warrants."
Common Stock
Outstanding prior to the
Offering(1). . . . . . . . 2,450,312 shares

Common Stock to be
Outstanding after the
Offering(1). . . . . . . . 3,521,741 shares

Use of Proceeds. . . . . . Research and development of the HTK Keratome and
the HRK Keratome, human clinical trials, repayment
of indebtedness, working capital and general
corporate purposes. See "Use of Proceeds."

Risk Factors . . . . . . . An investment in the Units involves a high degree
of risk and immediate substantial dilution. See
"Risk Factors" at page 9 and "Dilution."

Proposed OTC Bulletin. . . Units: MJETU
Board Symbols (2). . . . . Common Stock: MJETC
Class A Warrants: MJETW

- -----------------------------------

(1) Unless otherwise indicated, no effect is given to (i) 1,071,429 shares
reserved for issuance upon the exercise of the Warrants included in the
Units, (ii) 160,714 shares reserved for issuance upon the exercise of the
Underwriter's over-allotment option, (iii) 160,714 shares reserved for
issuance upon the exercise of the Warrants included in the Units included
in the Underwriter's over-allotment option, (iv) 214,286 shares reserved
for issuance upon the exercise of the Underwriter's Options and the
Warrants included therein, and (v) 200,000 shares reserved for issuance
pursuant to stock options available for grant under the Company's 1994
Stock Option Plan, as amended (the "Stock Option Plan"), 49,688 shares
reserved for issuance pursuant to stock options which have been granted
under the Stock Option Plan as of the date of this Prospectus and 102,000
shares reserved for issuance pursuant to outstanding warrants. Gives
effect to a stock split ratio of 1.987538926-for-1 effected in connection
with the Offering.

(2) Application has been made for the inclusion of the Securities on the OTC
Bulletin Board. See "Risk Factors -- No Assurance of Public Trading
Market; Denial of Nasdaq Listing."

RISK FACTORS

The discussion of risk factors which begins on page 9 hereof should be
considered carefully in evaluating an investment in the Securities. The risks of
investing in the Securities include the following factors: No Revenues;
Uncertain Profitability; Development Stage Company; History of Losses; Uncertain
Ability to Continue as a Going Concern; Dependence on Proceeds of this Offering;
Need for Future Financing; Dependence Upon Key Officer; Attraction and Retention
of Key Personnel; Uncertainty of Market Acceptance; Reliance on Single
Technology; Dependence on Patents and Proprietary Rights; Competitive
Technologies, Procedures and Companies; No Manufacturing Experience; Dependence
on Third Parties; No Sales or Marketing Experience; Risk of Product Liability
Litigation; Potential Unavailability of Insurance; Surgical Risks; No Assurance
of FDA and Other Regulatory Approval; International Sales and Operations Risks;
Broad Discretion in Application of Proceeds; Control by Current Stockholders;
Immediate Dilution; Disparity of Consideration Paid by Investors; Repayments

-7-

to Management from Proceeds of Offering; Future Sale of Unregistered
Securities; Registration Rights; Depressive Effect on Market Price of
Securities of Future Exercise of Options and Warrants; Loss of Warrants
through Redemption; Need for Current Prospectus and State Blue Sky
Registration in Connection with Exercise of Warrants; Underwriter as Market
Maker; No Dividends; Adverse Impact on Common Stock of Issuance of Preferred
Stock; Anti-Takeover Provisions; Arbitrary Determination of Offering Price;
Possible Volatility of Stock Price; No Assurance of Public Trading Market;
Denial of Nasdaq Listing; and Risk of Low-Priced Securities.

SUMMARY FINANCIAL INFORMATION

The following summary financial information is derived from the Company's
unaudited financial statements at March 31, 1996 included elsewhere in this
Prospectus and should be read in conjunction with, and are qualified in their
entirety by reference to, such financial statements and the notes thereto, and
in conjunction with "Plan of Operation."

SUMMARY BALANCE SHEET DATA: Actual March 31, 1996
------ --------------
as Adjusted(1)
--------------

Working capital (deficiency) . . . . . . $(460,445) $4,265,575
Total assets . . . . . . . . . . . . . . 352,707 4,728,727
Total liabilities. . . . . . . . . . . . 527,301 177,301
Stockholders' equity (deficit) . . . . . (174,594) 4,668,426

- ------------------------------

(1) Adjusted to give effect to (i) the sale of the Units in this Offering at
$5.60 per Unit and the net proceeds to the Company of approximately
$4,883,000 therefrom, (ii) the repayment from such net proceeds of $350,000
of indebtedness outstanding at March 31, 1996 and (iii) payment of $156,980
of expenses in this Offering which was reflected as an asset, "Deferred
Offering Costs," in the Company's unaudited financial statements at March
31, 1996. See "Use of Proceeds."

-8-

RISK FACTORS

The purchase of the Securities offered hereby involves a high degree of
risk. Before subscribing for the Securities, each prospective investor should
consider carefully the following risk factors.

NO REVENUES; UNCERTAIN PROFITABILITY; DEVELOPMENT STAGE COMPANY; HISTORY OF
LOSSES. Since its inception, the Company has been principally engaged in
developmental and organizational activities. To date, the Company has generated
no revenues from operations. No revenues are expected from operations until,
and only if, the Company begins commercial marketing of its keratome or other
products, which is not expected to occur before the third quarter of 1997. In
addition, commercial marketing of the Company's products in the U.S. will be
contingent upon obtaining FDA permission or approval and possibly the approval
of other governmental agencies. The approval procedure will be extremely time
consuming, expensive and uncertain. Accordingly, there can be no assurance that
the Company will be able to generate sufficient revenues to operate on a
profitable basis in the future.

The Company, which was founded in December 1993, is in the development
stage, and its business is subject to all of the risks inherent in the
establishment of a new business enterprise. The likelihood of the success of
the Company must be considered in light of the problems, expenses, complications
and delays frequently encountered in connection with the formation of a new
business, the development of new products, the competitive and regulatory
environment in which the Company may be operating, and the possibility that its
activities will not result in the development of any commercially viable
products. There can be no assurance that the Company's activities will
ultimately result in the development of commercially saleable or useful
products.

The Company has experienced annual operating losses and negative operating
cash flow since inception. At December 31, 1995, the Company had an accumulated
deficit of approximately $964,676. Unless and until the Company's product
development and marketing activities are successful and its products are sold,
of which there can be no assurance, the Company will not have revenues to apply
to operating expenses and the Company will continue to incur losses.
Additionally, as a result of the start-up nature of its business and the fact
that it has not commercially marketed any products, the Company can be expected
to sustain substantial operating losses in the future. See "Use of Proceeds"
and "Plan of Operation."

UNCERTAIN ABILITY TO CONTINUE AS A GOING CONCERN. The report of the
Company's independent auditors dated January 15, 1996, and with respect to Note
A(2), Note B(5) and (6), Note E, Note F, Note H, Note I and Note J which are
dated July 19, 1996, on the Company's financial statements for the period from
December 16, 1993 (Date of Inception) to December 31, 1995, includes an
explanatory paragraph expressing substantial doubt with respect to the Company's
ability to continue as a going concern. The financial statements do not contain
any adjustments that might result from the outcome of this uncertainty. See
"Use of Proceeds" and "Plan of Operation."

DEPENDENCE ON PROCEEDS OF THIS OFFERING; NEED FOR FUTURE FINANCING. The
Company is dependent on the proceeds of this Offering to fund current working
capital needs, additional research, development, engineering and testing of its
products, establishment of manufacturing and marketing capabilities and to fund
the governmental approval process. It anticipates that the net proceeds of this
Offering are sufficient to meet its cash requirements for approximately 24
months following this Offering if permission for the Company's 510(k)
notification is granted, or approximately 36 months if such permission is not
granted. The Company believes that, in order to proceed with the research,
development and marketing currently planned, it will require additional capital
before it reaches profitability and positive cash flows, if at all. As a
result, the Company will be required to raise additional funds through public or
private financing or grants that may be available for its research and
development. There can be no assurance that the Company will be able to obtain
additional financing on terms favorable to it or its stockholders, if at all.
If adequate funds are not available to satisfy short-term or long-term capital
requirements, the Company may be required to reduce substantially, or eliminate,
certain areas of its product development activities, limit its operations
significantly, or otherwise modify its business strategy. The failure of the
Company to obtain acceptable financing would have a material adverse effect on
the operations of the Company. Other than this Offering, the Company has no
current plans, understandings or commitments to raise any additional financing.
Additional financing may result in dilution for then current shareholders. See
"Use of Proceeds" and "Plan of Operation."

-9-

DEPENDENCE UPON KEY OFFICER; ATTRACTION AND RETENTION OF KEY PERSONNEL.
The business of the Company is highly dependent upon the active participation of
its founder and President, Dr. Eugene I. Gordon. The loss or unavailability to
the Company of Dr. Gordon would have a materially adverse effect on the
Company's business prospects and potential earning capacity. The recruitment of
skilled scientific personnel is critical to the Company's success. There can be
no assurance that it will be able to continue to attract such personnel in the
future. In addition, the Company's anticipated growth and expansion into areas
and activities requiring additional expertise, clinical testing, governmental
approvals, production and marketing are expected to place increased demands upon
the Company's financial resources and corporate structure. These demands, if
they arise, are expected to require the addition of new management personnel and
the development of additional expertise by existing management. See "Use of
Proceeds" and "Plan of Operation."

UNCERTAINTY OF MARKET ACCEPTANCE; RELIANCE ON SINGLE TECHNOLOGY.
Acceptance of the Company's keratome is difficult to predict and will require
substantial marketing efforts and the expenditure of significant funds. There
can be no assurance that the HTK Keratome or the HRK Keratome will be accepted
by the medical community once it is permitted or approved. Market acceptance of
the Company's keratome will depend in large part upon the Company's ability to
demonstrate the operational advantages, safety and cost-effectiveness of the
keratome compared to other refractive surgical techniques. Failure of the
keratome to achieve market acceptance will have a material adverse effect on the
Company's financial condition and results of operations. See "Business --
Markets."

At present, the Company's only product (although still in development
stage) is its keratome, and the Company expects that its keratome will be, if
and when commercially available, its sole product for an indefinite period of
time. The Company's present narrow focus on a particular product makes the
Company vulnerable to the development of superior competing products and changes
in technology that could eliminate the need for the Company's products. There
can be no assurance that significant changes in the foreseeable future in the
need for the Company's products or the desirability of those products, will not
occur. See "Risk Factors -- Dependence on Patents and Proprietary Rights" and
"Business -- Patents."

DEPENDENCE ON PATENTS AND PROPRIETARY RIGHTS. The Company's success will
depend in part on whether it successfully obtains and maintains patent
protection for its products, preserves its trade secrets and operates without
infringing the proprietary rights of third parties.

The Company has sought to protect its proprietary interest in the keratome
by applying for patents in the United States and corresponding patents abroad.
The Company has been notified by the United States Patent and Trademark Office
(the "PTO") that its patent application covering the Company's keratome has been
allowed for issuance. There can be no assurance that any other patent will be
issued to the Company, that any patents owned by or issued to the Company, or
that may issue to the Company in the future, will provide a competitive
advantage or will afford protection against competitors with similar technology,
or that competitors of the Company will not circumvent, or challenge the
validity of, any patents issued to the Company. There also can be no assurance
that any patents issued to or licensed by the Company will not be infringed upon
or designed around by others or would prevail in a legal challenge, that others
will not obtain patents that the Company will need to license or design around,
that the keratome or any other potential product of the Company will not
inadvertently infringe upon the patents of others, or that others will not
manufacture the Company's patented products upon expiration of such patents.
There can be no assurance that existing or future patents of the Company will
not be invalidated. Moreover, there can be no assurance that the Company's non-
disclosure agreements and other safeguards will protect its proprietary
information and trade secrets or provide adequate remedies for the Company in
the event of unauthorized use or disclosure of such information, or that others
will not be able to independently develop such information. As is the case with
the Company's patent rights, the enforcement by the Company of its non-
disclosure agreements can be lengthy and costly, with no guarantee of success.

The Company received a license from the New Jersey Institute of Technology
("NJIT") for the patent rights under a patent application assigned to it by Dr.
Gordon and two other individuals relating to a refractive correction procedure
based on the use of an isotonic waterjet, in a manner similar to photorefractive
keratectomy ("PRK").

-10-

Such patent application was subsequently denied by the PTO and on February 15,
1996, the Company gave notice to NJIT of its intent to terminate such license
agreement effective August 15, 1996.

If the Company becomes involved with patent infringement litigation, either
to enforce the Company's patents or defend against patent infringement suits,
such litigation would be lengthy and expensive, and if it occurs, would divert
Company resources from planned uses. Further, any adverse outcome in such
litigation could have a material adverse effect on the Company. If any of the
Company's products are found to infringe upon the patents or proprietary rights
of another party, the Company may be required to obtain licenses under such
patents or proprietary rights of such other party. No assurance can be given
that any such licenses would be made available on terms acceptable to the
Company, if at all. In addition, patent applications filed in foreign countries
and patents granted in such countries are subject to laws, rules and procedures
which differ from those in the United States. Patent protection in such
countries may be different from patent protection provided by United States laws
and may not be as favorable to the Company. There can be no assurance that the
Company's program of patent protection, including the internal security of its
proprietary information, and non-disclosure agreements will be sufficient to
protect the Company's proprietary technology from competitors. See "Business --
Patents and Proprietary Rights."

COMPETITIVE TECHNOLOGIES, PROCEDURES AND COMPANIES. The Company is engaged
in a rapidly evolving field. The HRK Keratome will compete with other presently
existing forms of treatment for vision disorders, including eyeglasses, contact
lenses, corneal transplants, other refractive surgery procedures and other
technologies under development. There can be no assurance that persons whose
vision can be corrected with eyeglasses or contact lenses will elect to undergo
the HRK surgical procedure when such non-surgical vision correction alternatives
are available.

There are many companies, both public and private, universities and
research laboratories engaged in activities relating to research on other vision
correction alternatives, including RK, PRK, KIS and various forms of corneal
inserts. Competition from these companies, universities and laboratories is
intense and is expected to increase.

The Company is not aware of any commercial entity, other than itself,
involved in the development of a waterjet scalpel for use in refractive surgery,
although it is aware of ongoing research at many companies and institutions into
a wide variety of procedures for corneal adjustment, as noted above. Many of
these companies and institutions have substantially greater resources, research
and development staffs and facilities, as well as greater experience in research
and development, obtaining regulatory approval and manufacturing and marketing
medical device products than the Company, and represent significant long-term
competition for the Company.

In addition to those mentioned above, other recently developed technologies
or procedures are, or may in the future be, the basis of competitive products.
There can be no assurance that the Company's competitors will not succeed in
developing technologies, procedures or products that are more effective or
economical than those being developed by the Company or that would render the
Company's technology and proposed products obsolete or noncompetitive.
Furthermore, if the Company is permitted to commence commercial sales of
products, it will also be competing with respect to manufacturing efficiency and
marketing capabilities, areas in which the Company has no experience. See "Risk
Factors -- No Manufacturing Experience; Dependence on Third Parties" and "-- No
Sales or Marketing Experience" and "Business -- Competition."

NO MANUFACTURING EXPERIENCE; DEPENDENCE ON THIRD PARTIES. The Company has
no volume manufacturing capacity or experience in manufacturing medical devices
or other products. To be successful, the Company's proposed products must be
manufactured in commercial quantities in compliance with regulatory requirements
at acceptable costs. Production in clinical or commercial-scale quantities may
involve technical challenges for the Company. Establishing its own
manufacturing capabilities would require significant scale-up expenses and
additions to facilities and personnel. The Company may consider seeking
collaborative arrangements with other companies to manufacture certain of its
potential products, including the HRK Keratome and the disposable templates to
be used in connection therewith. There can be no assurance that the Company
will be able to obtain necessary regulatory approvals on a timely basis or at
all. Delays in receipt of or failure to receive such approvals or loss of
previously received approvals would have a material adverse effect on the
Company's business,

-11-

financial condition and results of operations. There can be no assurance that
the Company will be able to develop clinical or commercial-scale manufacturing
capabilities at acceptable costs or enter into agreements with third parties
with respect to these activities. If the Company is dependent upon third
parties for the manufacture of its proposed products, then the Company's profit
margins and its ability to develop and deliver such products on a timely basis
may be adversely affected. Moreover, there can be no assurance that such
parties will perform adequately, and any failures by third parties may delay the
submission of products for regulatory approval, impair the Company's ability to
deliver products on a timely basis, or otherwise impair the Company's
competitive position. See "Business -- Markets."

NO SALES OR MARKETING EXPERIENCE. The Company intends to market and sell
the keratome in the United States and certain foreign countries, if and when
regulatory approval is obtained, through a direct sales force or a combination
of a direct sales force and distributors. The Company currently has no
marketing organization and has never sold a product. Establishing sufficient
marketing and sales capability will require significant resources. There can be
no assurance that the Company will be able to recruit and retain skilled sales
management, direct salespersons or distributors, or that the Company's sales
effort will be successful. To the extent that the Company enters into
distribution arrangements for the sale of its products, the Company will be
dependent on the efforts of third parties. There can be no assurance that such
efforts will be successful. See "Business -- The HRK Keratome" and "--
Markets."

RISK OF PRODUCT LIABILITY LITIGATION; POTENTIAL UNAVAILABILITY OF
INSURANCE. The testing, manufacture, marketing and sale of medical devices
entail the inherent risk of liability claims or product recalls. As a result,
the Company faces a risk of exposure to product liability claims and/or product
recalls in the event that the use of its keratome or other future potential
products are alleged to have caused injury. In addition to testing,
manufacturing and marketing the keratome, the Company intends to lease the
keratome and provide sterilization and maintenance services for the keratome,
which may enhance the Company's exposure to product liability claims. There can
be no assurance that the Company will avoid significant liability in spite of
the precautions taken to minimize exposure to avoid product liability claims.
Prior to the commencement of clinical testing, the Company intends to procure
product liability insurance. It is expected that such insurance will be in the
amount of $1 million per claim with an annual aggregate limit of $20 million.
After any commercialization of its products, the Company will seek to obtain an
appropriate increase in its coverage. However, there can be no assurance that
adequate insurance coverage will be available at an acceptable cost, if at all.
Consequently, a product liability claim, product recall or other claims with
respect to uninsured liabilities or in excess of insured liabilities could have
a material adverse effect on the business or financial condition of the Company.
See "Business -- Product Liability Insurance."

SURGICAL RISKS. There can be no assurance that the HRK System will be
successful in providing reliable refractive correction. As with all surgical
procedures, the procedures for which the Company's products are intended entail
certain inherent risks, including error in the location of the incision due to
movement of the eye, defective equipment or human error, infection or other
injury resulting in partial or total loss of vision. Such injury could expose
the Company to product liability or other claims. There can be no assurance
that the Company's product liability insurance in effect from time to time will
be sufficient to cover any such claim in part or in whole. Any such claim could
adversely impact the commercialization of the Company's products and could have
a material adverse effect on the business or financial condition of the Company.

NO ASSURANCE OF FDA AND OTHER REGULATORY APPROVAL. As a medical device,
the Company's keratome is subject to regulation by the FDA under the Federal
Food, Drug, and Cosmetic Act (the "FD&C Act") and implementing regulations.
Pursuant to the FD&C Act, the FDA regulates, among other things, the
development, manufacture, labeling, distribution, and promotion of the keratome
in the United States.

The Company believes, based on permission granted to other keratomes, that
the HTK Keratome, and subsequently the HRK Keratome, will be considered by the
FDA for permission through a Section 510(k) procedure, a much shorter and less
extensive process than the alternative PMA procedure. See "Plan of Operation."
However, there can be no assurance that the Company will obtain permission to
market the HTK Keratome, or the HRK Keratome, pursuant to a 510(k) notification,
or that in order to obtain such permission, the Company will not be required to
submit extensive clinical data or meet additional FDA requirements that may
substantially delay the

-12-

510(k) permission process and add to the Company's expenses. Moreover, such
permission, if obtained, may be subject to conditions with respect to the
marketing or manufacturing of the HTK Keratome that may impede the Company's
ability to market and/or manufacture such product. See "Business -- U.S.
Government Regulation."

If Section 510(k) permission is not granted for the HTK Keratome or the HRK
Keratome, the Company will seek approval through a PMA, typically a more complex
submission which usually includes the results of clinical studies, and preparing
an application is a detailed and time-consuming process. Once a PMA application
has been submitted, the FDA's review may be lengthy and may include requests for
additional data. Furthermore, there can be no assurance that a PMA application
will be approved by the FDA. See "Business -- The Company."

The process of obtaining required regulatory clearances or approvals can be
time-consuming and expensive, and compliance with the FDA's Good Manufacturing
Practices ("GMP") regulations and other regulatory requirements can be
burdensome. Moreover, there can be no assurance that the required regulatory
clearances will be obtained, and such clearances, if obtained, may include
significant limitations on the uses of the product in question. In addition,
changes in existing regulations or guidelines or the adoption of new regulations
or guidelines could make regulatory compliance by the Company more difficult in
the future. The failure to comply with applicable regulations could result in
fines, delays or suspensions of clearances, seizures or recalls of products,
operating restrictions and criminal prosecutions, and would have a material
adverse effect on the Company. See "Business -- U.S. Government Regulation."

Distribution of the Company's products in countries outside the United
States may be subject to regulation in those countries. Foreign regulatory
requirements vary widely from country to country. In addition, export sales of
medical devices that have not received FDA marketing clearance are generally
subject to FDA export permit requirements. There can be no assurance that the
Company will be able to obtain the approvals necessary to market the keratome or
any other product outside the United States.

INTERNATIONAL SALES AND OPERATIONS RISKS. The Company initially plans to
sell the keratome and any future products to customers outside of the United
States. However, the Company may begin manufacturing or operating activities
outside of the United States. A number of risks are inherent in international
transactions. International sales and operations may be limited or disrupted by
the imposition of the regulatory approval process, government controls, export
license requirements, political instability, price controls, trade restrictions,
changes in tariffs or difficulties in staffing and managing international
operations. Foreign regulatory agencies have or may establish product standards
different from those in the United States, and any inability to obtain foreign
regulatory approvals on a timely basis could have an adverse effect on the
Company's international business and its financial condition and results of
operations. Additionally, the Company's business, financial condition and
results of operations may be adversely affected by fluctuations in currency
exchange rates, increases in duty rates and difficulties in obtaining export
licenses. There can be no assurance that the Company will be able to
successfully commercialize the keratome or any future product in any foreign
market. See "Business -- Marketing and Sales."

BROAD DISCRETION IN APPLICATION OF PROCEEDS. Approximately $568,000, or
11.6%, of the estimated $4,883,000 of net proceeds from the sale of the Units
offered hereby will be applied to working capital and general corporate
purposes. Accordingly, the Company's management will have broad discretion as
to the use of these proceeds. See "Use of Proceeds."

CONTROL BY CURRENT STOCKHOLDERS. Upon consummation of this Offering, the
Company's current stockholders will own 2,450,312 shares of Common Stock
(without giving effect to 49,688 shares of Common Stock reserved for issuance
pursuant to outstanding options under the Stock Option Plan and 102,000 shares
of Common Stock reserved for issuance pursuant to outstanding warrants),
representing approximately 69.6% of the issued and outstanding shares (66.5%, if
the over-allotment option is exercised in full). Accordingly, the current
stockholders will be able to elect all the Company's directors and generally
direct the affairs of the Company. The control of the Company by these persons
could impede or prevent a change of control of the Company. As a result,
potential future purchasers might not seek to complete a proposed purchase of
the Company. See "Management," "Principal Stockholders" and "Description of
Securities -- Common Stock."

-13-

IMMEDIATE DILUTION; DISPARITY OF CONSIDERATION PAID BY INVESTORS. Upon
consummation of this Offering, purchasers of the Units offered hereby will
experience immediate and substantial dilution in the net tangible book value of
their investment in the Company of $4.27, or approximately 76.3%, per share.
Dr. Gordon and certain other current stockholders of the Company each acquired
their shares of Common Stock at a nominal price. Additional dilution to future
net tangible book value per share may occur upon the exercise of the Warrants to
be issued to the Underwriter and options that may be issued pursuant to the
Stock Option Plan. See "Dilution," "Management -- 1994 Stock Option Plan" and
"Underwriting."

REPAYMENTS TO MANAGEMENT FROM PROCEEDS OF OFFERING. After the consummation
of this Offering, the Company intends to repay an aggregate principal amount of
$315,000 of indebtedness to Eugene I. Gordon, who is President, Chairman of the
Board and a principal stockholder of the Company, and $50,000 of indebtedness to
each of Steven G. Cooperman, a Director of the Company, and Sanford J.
Hillsberg, who has been elected to serve as a Director of the Company upon
consummation of the Offering. Thus, purchasers of the Units offered hereby are
advised that such members of the Company's management will personally benefit
from the consummation of this Offering. See "Use of Proceeds," "Management" and
" Certain Transactions."

FUTURE SALE OF UNREGISTERED SECURITIES; REGISTRATION RIGHTS. After the
Offering, the Company will have outstanding 3,521,741 shares (3,682,455 shares,
if the over-allotment option is exercised in full) of Common Stock (without
giving effect to (i) 1,071,429 shares of Common Stock reserved for issuance upon
the exercise of the Warrants included in the Units and 160,714 additional shares
of Common Stock reserved for issuance upon the exercise of the additional
warrants if the over-allotment option is exercised in full, (ii) 214,286 shares
of Common Stock reserved for issuance upon the exercise of the Underwriter's
Options and the Warrants included therein, (iii) 249,688 shares of Common Stock
reserved for issuance pursuant to the Stock Option Plan and (iv) 102,000 shares
of Common Stock reserved for issuance pursuant to outstanding warrants), all of
which are "restricted securities" within the meaning of Rule 144 under the
Securities Act. As of the date of this Prospectus, options to purchase 49,688
shares of Common Stock have been granted pursuant to the Stock Option Plan and
warrants to purchase 102,000 shares of Common Stock have been granted. The
Company has agreed with the Underwriter that options with respect to the 200,000
shares under the Stock Option Plan which have not yet been granted as of the
date of this Prospectus shall, upon grant vest no earlier than one year from the
date of grant.

The Company has granted certain piggyback registration rights to certain of
its existing stockholders with respect to 703,595 shares. The holders of all of
such shares have agreed to waive such registration rights for a period of two
years. Shares issuable upon exercise of stock options granted under the Stock
Option Plan may be registered under the Securities Act commencing 24 months
after the Effective Date or such earlier date as consented to by the
Underwriter. All of the shares of Common Stock issuable in connection with the
Underwriter's Options, including the Common Stock contained in the Units and the
Common Stock issuable upon exercise of the Warrants, may, at the request of the
Underwriter (as defined herein) be registered by the Company for sale to the
public. The sale or the availability for sale of any or all of such shares of
Common Stock or other Securities could adversely affect the market price of the
Securities prevailing from time to time. See "Management -- 1994 Stock Option
Plan," "Shares Eligible for Future Sale" and "Underwriting."

DEPRESSIVE EFFECT ON MARKET PRICE OF SECURITIES OF FUTURE EXERCISE OF
OPTIONS AND WARRANTS. Sales of the Company's Common Stock upon exercise of
options may have a depressive effect on the price of the Units, the Common Stock
and the Warrants, and issuance of additional Common Stock upon the exercise of
options, the Warrants, the Underwriter's Options or otherwise will also dilute
the proportionate ownership of the then current stockholders of the Company.
The Company has agreed with the Underwriter not to issue shares of Common Stock
without the Underwriter's prior written consent during the 24-month period
following the Effective Date, other than pursuant to the Stock Option Plan and
the Warrants. The Company has further agreed with the Underwriter that during
the 12-month period commencing 12 months after the Effective Date, it will not
issue shares of Common Stock at a price less that the then "Market Price"
thereof, other than pursuant to the Stock Option Plan. "Market Price" is
defined as (i) the average closing bid price, for any 10 consecutive trading
days within a period of 30 consecutive trading days ending within five days
prior to the date of issuance of the Common Stock, as reported by the National
Association of Securities Dealers, Inc. Automated Quotation System or the OTC
Bulletin Board or (ii) the average of the last reported sale price, for the 10
consecutive business days ending within five days of

-14-

the date of issuance of the Common Stock, on the primary exchange on which the
Common Stock is traded, if the Common Stock is traded on a national securities
exchange. See "Management -- 1994 Stock Option Plan" and "Description of
Securities."

LOSS OF WARRANTS THROUGH REDEMPTION. The Warrants are subject to
redemption by the Company. Redemption of the Warrants could force the holders
to exercise the Warrants and pay the exercise prices at a time when it may be
disadvantageous for the holders to do so, to sell the Warrants at the current
market price when they might otherwise wish to hold the Warrants or to accept
the redemption price, which may be substantially less than the market value of
the Warrants at the time of redemption. The holders of the Warrants will
automatically forfeit their rights to purchase the shares of Common Stock
issuable upon exercise of such Warrants unless the Warrants are exercised before
they are redeemed. The holders of Warrants will not possess any rights as
stockholders of the Company unless and until their Warrants are exercised. See
"Description of Securities -- Warrants."

NEED FOR CURRENT PROSPECTUS AND STATE BLUE SKY REGISTRATION IN CONNECTION
WITH EXERCISE OF WARRANTS. The Company will be able to issue shares of its
Common Stock upon exercise of the Warrants only if there is a then current
prospectus relating to the Common Stock issuable upon the exercise of the
Warrants under an effective registration statement filed with the Commission,
and only if such Common Stock is then qualified for sale or exempt from
qualification under applicable state securities laws of the jurisdictions in
which the various holders of Warrants reside. There can be no assurance that
the Company will be able to meet these requirements. The failure of the Company
to meet these requirements may deprive the Warrants of their value and cause the
resale or disposition of Common Stock issued upon the exercise of the Warrants
to become unlawful. See "Description of Securities."

UNDERWRITER AS MARKET MAKER. A significant amount of the Units that are to
be sold in this Offering may be sold to customers of the Underwriter. These
customers subsequently may engage in transactions for the sale or purchase of
such securities through or with the Underwriter. Although it has no legal
obligation to do so, the Underwriter has indicated that it intends to act as a
market-maker and otherwise effect transactions in the securities offered hereby.
To the extent the Underwriter acts as a market-maker in the Units, Common Stock
or Warrants, it may be a dominating influence in those markets. The degree of
participation in those markets by the Underwriter may significantly affect the
price and liquidity of the Company's securities. The Underwriter may
discontinue these activities at any time or from time to time. The Company
cannot ensure that broker-dealers other than the Underwriter will make a market
in the Company's securities. In the event that other broker-dealers fail to
make a market in the Company's securities, the possibility exists that the
market for and the liquidity of the Company's securities could be adversely
affected, which in turn could affect stockholders' ability to trade the
Company's securities.

Further, unless granted an exemption by the Commission pursuant to Rule
10b-6 under the Securities Exchange Act of 1934 (the "Exchange Act"), the
Underwriter may be prohibited from engaging in any market making activities with
regard to the Company's securities for the period of from two to nine business
days prior to the exercise of the Underwriter's Options or if it is soliciting
the exercise of the Warrants. As a result, the Underwriter may be unable to
continue to provide a market for the Company's securities during certain
periods, which may adversely affect the price and liquidity of the securities.
See "Underwriting."

NO DIVIDENDS. The Company has paid no dividends since its inception and
does not intend to pay dividends in the foreseeable future. Any earnings which
the Company may realize in the foreseeable future will be retained to finance
the growth of the Company. See "Dividend Policy."

ADVERSE IMPACT ON COMMON STOCK OF ISSUANCE OF PREFERRED STOCK; ANTI-
TAKEOVER PROVISIONS. The Board of Directors of the Company has the authority to
issue up to 1,000,000 shares of preferred stock in one or more series and to
determine the number of shares in each series, as well as the designations,
preferences, rights and qualifications or restrictions of those shares, without
any further vote or action by the stockholders of the Company. The rights of
the holders of Common Stock will be subject to, and may be adversely affected
by, the rights of the holders of any preferred stock that may be issued in the
future, including that the market price of the Common Stock may be adversely
impacted upon the issuance of a series of preferred stock with voting and/or

-15-

distribution rights superior to those of the Common Stock. The issuance of
preferred stock could have the effect of making it more difficult for a third
party to acquire a majority of the outstanding voting stock of the Company. In
addition, the Company will, upon consummation of this Offering, be subject to
the anti-takeover provisions of Section 203 of the Delaware General Corporation
Law. In general, this statute prohibits a publicly-held Delaware corporation
from engaging in a "business combination" with an "interested stockholder" for a
period of three years after the date of the transaction in which the person
became an interested stockholder, unless the business combination is approved in
a prescribed manner. See "Description of Securities -- Preferred Stock" and
"Description of Securities -- Anti-Takeover Effects of Delaware Law."

ARBITRARY DETERMINATION OF OFFERING PRICES. The initial offering price of
the Units and the exercise and redemption price of the Warrants were arbitrarily
determined by negotiations between the Company and the Underwriter and bear no
relationship to the Company's asset value, book value, net worth, results of
operations or any other generally accepted criteria of value. See
"Underwriting."

POSSIBLE VOLATILITY OF STOCK PRICE. The market prices for securities of
medical device companies have been highly volatile. Announcements regarding the
results of regulatory approval filings, clinical studies or other testing,
technological innovations or new commercial products by a Company or its
competitors, proposed government regulations, developments concerning
proprietary rights or public concern as to safety of technology have
historically had, and are expected to continue to have, a significant impact on
the market prices of the securities of medical device companies. The trading
price of the Common Stock could also be subject to significant fluctuations in
response to variations in the Company's operating results. See "Business --
Competition."

NO ASSURANCE OF PUBLIC TRADING MARKET; DENIAL OF NASDAQ LISTING. Prior to
this Offering, there has been no established trading market for the Securities
and there is no assurance that a regular trading market for the Securities on
the Nasdaq system, or any other exchange, will develop after the consummation of
this Offering. If a trading market does develop for the Securities offered
hereby, there can be no assurance that it will be sustained. The Company's
application to list the Securities on Nasdaq was denied by the Nasdaq staff
because of its concerns regarding the Company's early stage of development. The
Company is in the process of appealing the determination of Nasdaq and will
continue to pursue the listing of its Securities on Nasdaq, the success of which
there can be no assurance. Although the Company has applied for the inclusion
of the Securities on the OTC Bulletin Board, there can be no assurance that such
application will be approved or that, even if it is approved, a regular trading
market for the Securities will develop after this Offering or that, if
developed, it will be sustained. The OTC Bulletin Board is an unorganized,
inter-dealer, over-the-counter market which provides significantly less
liquidity than the Nasdaq National Market system, and quotes for stocks included
on the OTC Bulletin Board are not listed in the financial sections of newspapers
as are those for the Nasdaq National Market system. Therefore, prices for
securities traded solely on the OTC Bulletin Board may be difficult to obtain
and purchasers of the Units may be unable to resell the Securities offered
hereby at or near their original offering price or at any price. In the event
the Securities are not included on the OTC Bulletin Board, quotes for the
Securities may be included in the "pink sheets" for the over-the-counter market.
See "Risk Factors -- Risk of Low-Priced Securities," "Description of Securities
- -- Certain Market Information" and "Underwriting."

RISK OF LOW-PRICED SECURITIES. The Commission has adopted regulations
which generally define a "penny stock" to be any equity security that has a
market price (as defined in the regulations) of less than $5.00 per share and
that is not traded on a national stock exchange, Nasdaq or The Nasdaq National
Market System. If the Securities are included on the OTC Bulletin Board and are
trading at less than $5.00 per Security, they may become subject to rules of the
Commission that impose additional sales practice requirements on broker-dealers
effecting transactions in penny stocks. In most instances, unless the purchaser
is either (i) an institutional accredited investor, (ii) the issuer, (iii) a
director, officer, general partner or beneficial owner of more than 5% of any
class of equity security of the issuer of the penny stock that is the subject of
the transaction or (iv) an established customer of the broker-dealer, the
broker-dealer must make a special suitability determination for the purchaser of
such securities and have received the purchaser's prior written consent to the
transaction. Additionally, for any transaction involving a penny stock, the
rules of the Commission require, among other things, the delivery, prior to the
transaction, of a disclosure schedule prepared by the Commission relating to the
penny stock market and the risks associated therewith. The broker-dealer also
must disclose the commissions payable to both the broker-dealer and

-16-

its registered representative and current quotations for the securities.
Finally, among other requirements, monthly statements must be sent to the
purchaser of the penny stock disclosing recent price information for the
penny stock held in the purchaser's account and information on the limited
market in penny stocks. Consequently, the penny stock rules may restrict the
ability of broker-dealers to sell the Securities and may affect the ability
of purchasers in this Offering to sell the Securities in the secondary
market. See "Risk Factors -- No Assurance of Public Trading Market; Denial
of Nasdaq Listing."

-17-

USE OF PROCEEDS

The estimated net proceeds from the sale of the Units offered hereby, after
deducting the underwriting discount of $600,000 and other expenses of the
Offering, estimated to be $517,000, will be approximately $4,883,000 ($5,666,000
if the over-allotment option is exercised in full). The Company currently
intends to initially allocate the net proceeds of this Offering as follows:

Approximate Percent
Application of Proceeds Amount of Proceed of Net Proceeds
- ----------------------- ------------------ ---------------

Research and development (1) 3,050,000 62.5%
Human clinical trials (2) 500,000 10.2
Repayment of indebtedness (3) 715,000 14.6
Patent filings (4) 50,000 1.0
Working capital and general
corporate purposes 568,000 11.6
Total $4,883,000 100.0%
--------- ------
--------- ------

- --------------------------
(1) Includes trials involving rabbit eyes, generation of data at the Company's
Edison, New Jersey laboratory, payments for the use of laboratory
facilities at the University (as defined herein), salaries of officers and
other employees and payments to consultants engaged in research and
development.

(2) Includes payments to hospitals or other institutions at which operations on
humans will be conducted.

(3) Includes four loans to the Company from Mrs. Jan Wernick in an aggregate
principal amount of $200,000, which bear interest at the rate of 12% per
annum and are due and payable on or after December 31, 1996. Mrs.
Wernick's husband is affiliated with the Underwriter as the manager of its
New York office. Such loans were obtained through the Underwriter in
connection with the Offering, and the terms thereof (including the interest
rates) were negotiated under different circumstances than other loans
obtained by the Company. Also includes seven loans to the Company from
Eugene I. Gordon, six in an aggregate principal amount of $250,000 which
bear interest at the rate of 7% per annum and one in the amount of $65,000
which bears interest at the rate of 9% per annum, and are due and payable
upon demand; two loans to the Company, one from each of Steven G. Cooperman
and Sanford J. Hillsberg, each in the principal amount of $50,000, which
bear interest at the rate of 8% per annum and are due and payable on the
earlier of (a) written demand made any time on or after January 31, 1997 or
(b) the consummation of this Offering, and a loan to the Company from
Robert P. Lehmann, M.D., a stockholder of the Company, in the principal
amount of $100,000 which bears interest at the rate of 9% per annum and is
due and payable upon written demand made any time on or after December 31,
1996. Drs. Gordon and Cooperman are directors and stockholders of the
Company. Mr. Hillsberg will begin serving as a director upon the
consummation of the Offering and is a stockholder of the Company. All such
loans were made after September 30, 1995 and were used for various
purposes, including research costs, payroll and other expenses. See
"Certain Transactions" and "Underwriting."

(4) The amount of proceeds to be applied to patent filings in the event of the
sale of the maximum number of Units offered hereby reflects the costs
associated with the filing of additional patent applications by the
Company.

-18-

The initial application of the net proceeds of this Offering represents the
Company's estimates based upon current business and economic conditions.
Although the Company does not contemplate material changes in the proposed
allocation of the use of proceeds, to the extent that the Company finds that an
adjustment is required by reason of existing business conditions, the amounts
shown may be adjusted among the uses indicated above.

The Company has limited cash and working capital and is dependent on the
net proceeds of this Offering for the continuation and expansion of the
Company's operations. The Company believes that the net proceeds of this
Offering will be sufficient for the Company to conduct its proposed business for
at least the 24-month period following this Offering; however, there can be no
assurance that such net proceeds will be sufficient to finance the Company's
operations for such period. The Company believes that it will require
additional capital before it reaches profitability and positive cash flow, if at
all. See "Risk Factors -- Dependence on Proceeds of this Offering -- Need for
Future Financing" and "Plan of Operation."

To the extent that the Company's expenditures are less than projected, the
resulting balances will be used for the purposes set forth above and/or for
other general working capital expenses. The net proceeds of this Offering that
are not expended immediately will be deposited in interest-bearing accounts, or
invested in money market investments, certificates of deposit or similar short-
term, low-risk investments. Any additional proceeds received upon the exercise
of the Underwriter's Options, as well as from the foregoing short-term
investments, will be added to working capital.

-19-

DILUTION

The difference between the initial public offering price per share of
Common Stock and the pro forma net tangible book value per share after this
Offering constitutes the dilution to investors in this Offering. Net tangible
book value per share is determined by dividing the net tangible book value of
the Company (total tangible assets less total liabilities) by the number of
outstanding shares of Common Stock. At March 31, 1996, the Company had a net
tangible book value of $(372,777), or $(.15) per share.

After the sale of 1,071,429 Units (less underwriting commissions and
estimated expenses of this Offering), the pro forma net tangible book value of
the Company at March 31, 1996 would have been $4,667,203, or $1.33 per share,
representing an immediate increase in net tangible book value of $1.48 per share
to the existing shareholders and an immediate dilution of $4.27 (76.3%) per
share to new investors.

The following table illustrates the foregoing information with respect to
dilution to new investors on a per-share basis upon the sale of the Units:

Public offering price per share(1) . . . . . . . . . . . . . . . $5.60

Net tangible book value per share before Offering. . . . . . . . $(.15)

Increase per share attributable to new investors . . . . . . . . 1.48

As adjusted, net tangible book value per share after Offering(2) 1.33

Dilution per share to public investors . . . . . . . . . . . . . $4.27

- -----------------
(1) Does not attribute any value to the Warrants.
(2) Does not include funds that may be received upon the exercise of the
Warrants.

If the over-allotment option is exercised in full, the dilution to
purchasers of the Units would be $4.12 (73.6%) per share.

The following tables set forth, at March 31, 1996, with respect to the (a)
Company's existing stockholders and (b) purchasers of the Units offered hereby,
a comparison of the number of shares of Common Stock acquired from the Company,
the total consideration paid (but attributing no value to the Warrants) and the
average price per share of Common Stock upon the sale of the Units.

Average Price
Shares Purchased Total Consideration per Share
---------------- ------------------- ---------
---------------- ------------------- ---------
Number Percent Amount Percent
------ ------- ------ -------
------ ------- ------ -------

Existing Stockholders 2,450,312 70.0% $ 966,824 14% $ .352

New Investors. . . . 1,071,429 30.0 6,000,000 86 5.60
--------- ----- --------- ----

Total. . . . . . 3,521,741 100% $6,966,824 100%
--------- ---- --------- ----
--------- ---- --------- ----

-20-

CAPITALIZATION

The following table sets forth the capitalization of the Company as of
March 31, 1996, as adjusted to give effect to (i) the sale of the Units and the
application of the estimated net proceeds therefrom, (ii) the repayment of
$350,000 of indebtedness, including interest, outstanding at March 31, 1996,
from the net proceeds received by the Company and (iii) a 1.987538926 for-1
stock split of the Company's Common Stock effected immediately prior to the date
of this Prospectus. See "Financial Statements," "Use of Proceeds" and
"Description of Securities."

AT MARCH 31, 1996
-------------------------------------
Actual Adjustments As Adjusted
------ ----------- -----------

Notes payable. . . . . . . . . . . . . . . . . . . . . . $ 350,000 $ (350,000) $ -0-
------- ------------
Stockholders' equity:
Common Stock, $.001 par value,
7,000,000 shares authorized; 2,450,312 shares issued
and outstanding; 3,521,741 shares as adjusted (1). . . $ 2,450 $ 1,072 $ 3,522
Additional paid-in capital . . . . . . . . . . . . . . 964,374 3,699,686 4,664,060
Deficit accumulated during the development stage (2) . (1,141,418) 1,141,418 0
----------- ------------
Total capitalization . . . . . . . . . . . . . . . . . . $ (174,594) $ 4,668,426
--------- ------------

- -----------------

(1) Unless otherwise indicated, no effect is given to (i) 1,071,429 shares of
Common Stock reserved for issuance upon the exercise of the 1,071,429
Warrants included in the Units, (ii) 160,714 shares reserved for issuance
upon the exercise of the Underwriter's over-allotment option, (iii) 160,714
shares reserved for issuance upon the exercise of the Warrants included in
the Units included in the Underwriter's over-allotment option, (iv) 214,826
shares reserved for issuance upon the exercise of the Underwriter's Options
and the Warrants included therein, (v) 200,000 shares reserved for issuance
pursuant to stock options available for grant under the Stock Option Plan,
49,688 shares of Common Stock reserved for issuance upon the exercise of
outstanding options under the Stock Option Plan and 102,000 shares reserved
for issuance pursuant to outstanding warrants and (vi) payment of $156,980
of expenses in this Offering which was reflected as an asset, "Deferred
Offering Costs," in the Company's unaudited financial statements at March
31, 1996. See "Description of Securities" and "Underwriting."

(2) Upon completion of the Offering, the Company's status will change from an
"S" corporation to a "C" corporation. Accordingly, the deficits
accumulated during the development stage are charged against additional
paid in capital.

DIVIDEND POLICY

The Company has not paid dividends on its Common Stock since its
inception and does not expect to pay any cash or other dividends in the
foreseeable future. Earnings of the Company, if any, are expected to be
retained for use in expanding the Company's business. The payment of dividends
is within the discretion of the Board of Directors of the Company and will
depend upon the Company's earnings, if any, capital requirements, financial
condition and such other factors as are considered relevant by the Board of
Directors.

PLAN OF OPERATION

OPERATION FOR THE NEXT TWELVE MONTHS

For the next 12 months, the Company intends to continue testing and
developing the HTK Keratome and the HRK Keratome. If the Company's animal
testing program in the United States continues to succeed, the Company intends
to have discussions with FDA officials and then initiate clinical testing
programs on blind human eyes at one site in the United States and at four sites
outside the United States. The Company anticipates that its first keratome
suitable for use in human clinical trials will be completed early in the third
quarter of 1996. The clinical test sites selected by the Company are located
in Israel, Germany, Mexico and the Dominican Republic.

-21-

The Company estimates that the cost of conducting clinical trials at each
site will be approximately $50,000. However, there can be no assurance that
such actions will be taken within such time periods.

510(K) NOTIFICATION

In an effort to expedite the regulatory approval process for the Company's
keratome, the Company intends to submit to the FDA two Section 510(k)
notifications with respect to the HTK Keratome within approximately six months
of the Effective Date. The Company's applications will be based on the HTK
Keratome's similarity to other FDA-permitted keratomes. See "Business - U.S.
Government Regulation." A successful 510(k) notification generally results in
FDA permission within three to 12 months. However, there can be no assurance
that the Company's 510(k) notifications will be granted on a timely basis or at
all.

CASH REQUIREMENTS

If any of the Company's 510(k) notifications for the HTK Keratome is
permitted by the FDA in the first half of 1997, the Company estimates that the
net proceeds of this Offering will be sufficient to fund its operations for
approximately 24 months after the Effective Date, without taking into account
operating cash flow, if any. In that event, the Company intends to make
expenditures to establish a manufacturing facility as well as to hire marketing
staff. If none of the Company's 510(k) notifications are permitted within such
period, the Company estimates that the net proceeds from this Offering will be
sufficient to fund its operations for approximately 36 months. In that event,
the Company plans to conduct human clinical trials during such period for the
purpose of accumulating sufficient clinical data to obtain FDA permission to
market the HTK Keratome. The FDA process can be expensive, uncertain and
lengthy; accordingly, the Company may require additional financing prior to
obtaining FDA permission to market the HTK Keratome.

CLINICAL TRIALS AND PRODUCT RESEARCH AND DEVELOPMENT

The Company intends to use approximately $0.5 million of the net proceeds
of this Offering to initiate and conduct human clinical trials involving blind
eyes or eyes scheduled to be removed for other reasons, and approximately $3.1
million for research and development of the HRK Keratome. These amounts include
the salaries of the employees who will be conducting research and development of
the HRK Keratome, monitoring the progress of clinical testing and preparing
applications and other filings with regulatory authorities.

LABORATORY FACILITIES

The Company currently leases a 4,982 square foot facility in Edison, New
Jersey for its research and development operations, which the Company believes
will be adequate for research and development of the keratome prior to its
commercialization. The Company believes that nearby space suitable for a
manufacturing facility is in adequate supply.

NUMBER OF EMPLOYEES

The Company currently employs nine individuals on a full-time basis and one
individual on a part-time basis, as well as one medical consultant, one
marketing consultant and two strategic planning and business development
consultants. After the consummation of this Offering, the Company intends to
increase its laboratory staff to 10 persons. If and when the HTK Keratome
receives FDA permission to market or other approval, the Company intends to
employ additional individuals in connection with the manufacturing and marketing
of the HRK Keratome.

-22-

BUSINESS

THE COMPANY

The Company, founded in December 1993, has developed a proprietary surgical
device known as a keratome, which utilizes a hair-thin (approximately 30 microns
in diameter) circular beam of supersonic velocity water. The waterjet beam
substitutes for a conventional metal or diamond blade scalpel and in combination
with other elements of the device is capable of shaving thin, shaped layers from
the cornea of the eye, a procedure known as lamellar keratoplasty. The keratome
is used to remove layers of the cornea and to treat diseases of the cornea as
well as to correct vision deficiencies such as nearsightedness ("myopia"),
farsightedness ("hyperopia") and astigmatism by excising layers, either parallel
or shaped, of the cornea in order to reshape the cornea to achieve proper
focusing. In combination with a template of prescribed dimensions, the shape of
the layer to be removed can be determined in advance.

The Company believes that its keratome can be used to remove the epithelium
(the outer layer of the eye) or treat corneal disease in a procedure known as
hydro-therapeutic keratoplasty ("HTK"), in which diseased corneal tissue is
removed and the remaining corneal tissue may be reshaped to provide proper
focusing. About 45,000 corneal procedures, including full transplants and
partial removals, are performed annually in the United States. The Company
believes that the same keratome, through a procedure known as hydro-refractive
keratoplasty ("HRK"), has the potential to reduce or eliminate a patient's
dependence on eyeglasses or contact lenses by modifying the shape of the cornea
to correct vision deficiencies. Based upon feasibility studies and limited
animal testing conducted by the Company, the Company believes that its waterjet
scalpel cuts more precisely and smoothly than the sharpest metal, diamond or
laser scalpel and that, as a result, HRK may result, if approved, in a safer,
more accurate and more stable corneal adjustment that is less painful for
patients than other refractive surgical procedures currently available. The
Company anticipates that HRK will also be competitively priced with, or cost
less than, such other procedures. The Company has not independently tested
competing products but has reviewed research reports and offering materials
describing various competitive products.

The Company has not yet tested its Keratome on live human eyes but has
tested its waterjet keratome on approximately 1,000 porcine and rabbit corneas,
25 human cadaver eyes and 22 live rabbits. The Company began development in
March 1996 of a keratome designed for use in surgery on non-human primates and
humans in a clinical setting. Due to funding limitations, the Company has not
yet constructed a full prototype of its keratome or conducted tests on live
humans of either HRK or HTK procedures using the its waterjet keratome. The
Company believes that limited testing of HRK and/or HTK procedures using a
keratome similar to the Company's has been done by others.

The following diagram illustrates the Company's keratome:

[CONTINUED ON NEXT PAGE]

-23-

[DIAGRAM OF MICROSCOPE WITH WATERJET KERATOME]

-24-

The Company believes that the keratome, when used in HTK (the "HTK
Keratome"), would be used similarly to other keratomes but would allow for the
removal of the epithelium or layers of corneal tissue of a predetermined shape
and thickness with a higher degree of accuracy as well as producing a more
cleanly cut surface of the stroma, the main layer of the cornea. The Company
intends to seek permission from the United States Food and Drug Administration
("FDA") to market the HTK Keratome. The HTK Keratome is intended to become the
first commercially available product using the Company's waterjet technology and
would be both an early source of income for the Company and the basis for
additional applications for FDA-permitted uses of the keratome.

A subsequent and possibly more commercially valuable use of the keratome is
for refractive surgery through HRK. Subsequent to the permitted marketing of
the HTK Keratome, the Company intends to seek FDA permission to market the
keratome for HRK (the "HRK Keratome"). In the United States, more than 145
million people wear either eyeglasses or contact lenses. Over $13 billion is
spent annually in the United States for corrective eyewear products.
Approximately 29 million Americans wear contact lenses, primarily for cosmetic
or convenience reasons. The number of people in the United States newly
electing to wear contact lenses is over one million per year. This large and
growing population of contact lens wearers is the largest potential market for
refractive surgery, including HRK. Studies indicate that approximately 60% of
persons electing refractive surgery are contact lens wearers. However, there
can be no assurance that eyeglass or contact lens wearers will elect to undergo
surgery.

Upon permission to market, or other approval of, the HRK Keratome (of which
there can be no assurance), the Company intends to market the HRK Keratome to
individual ophthalmologists and groups of ophthalmologists for the treatment of
patients in a clinical setting. The Company expects to derive a significant
part of its revenues from leasing the keratome, to be returned by the
ophthalmologist to the Company after each procedure for sterilization, routine
maintenance and recharging. The Company believes that by retaining control over
the sterilization process and performing any necessary maintenance itself, the
efficacy, safety and reliability of the keratome will be enhanced. In addition,
the Company believes that the leasing arrangement will be attractive to
ophthalmologists, because they will be able to maintain a supply of keratomes on
hand, thereby eliminating the down time that would otherwise be required for the
sterilization process. The Company intends to sell the other components of the
keratome, including the disposable, single-use template designed for each
particular use as instructed by the surgeon.

The Company believes that its proprietary waterjet technology may have
additional surgical applications. However, the Company has conducted only
limited studies of such applications to date.

The Company has sought to protect its proprietary interest in the HRK
Keratome by applying for patents in the United States and corresponding patents
abroad. In September 1994, a U.S. patent application was filed in the name of
Dr. Eugene I. Gordon and two employees of the Company, as inventors, which
application was assigned to the Company. The U.S. patent application, as
allowed for issuance, covers a method and device for use in the HRK Keratome,
including use of a template for corneal shaping and holding, during use of a
waterjet keratome device. A corresponding international application has been
filed, pursuant to the Patent Cooperation Treaty ("PCT"), with designation of
all member countries foreign to the United States, including but not limited to
Japan, the members of the European Patent Office, Canada, Mexico, Australia,
Russia, China and Brazil. The PCT filing has been published and separate patent
applications have been or will be filed pursuant to the PCT filing. In
addition, for countries not currently part of the PCT, patent applications have
also been filed in Israel, Taiwan and South Africa. A U.S. patent application
is currently pending and relates to topographic corneal mapping, which has
utility for surgery utilizing the HRK Keratome.

-25-

The FDA has regulatory authority over the manufacture, labeling,
distribution and promotion of the keratome. The initial phase of the Company's
FDA strategy involves seeking permission to market, or other approval of, the
HTK Keratome. The FDA has recommended to the Company that it seek permission to
market the HTK Keratome through a Section 510(k) pre-market notification
("510(k) notification") procedure together with a limited number of clinical
trials, and it is the intent of the Company to file two such notifications with
the FDA in the second half of 1996 relating to two uses of the HTK Keratome.
Although there can be no assurance that this will prove to be the case,
permission granted for the 510(k) notifications should enable the Company to
commence its marketing efforts sooner than if the Company had to submit to the
FDA a pre-market approval ("PMA") application. In order to obtain FDA clearance
of a 510(k) notification, a company must prove its device is substantially
similar to a marketed product. PMA applications must demonstrate, among other
matters, that the device is safe and effective. Although human clinical trial
data is sometimes required to be submitted with a 510(k) notification, a PMA
application is typically a more complex submission which usually includes the
results of clinical studies, and preparing an application is a detailed and
time-consuming process. Once a PMA application has been submitted, the FDA's
review may be lengthy and may include requests for additional data. See "--
U.S. Government Regulation" and "Risk Factors -- No Assurance of FDA and Other
Regulatory Approval."

Although the therapeutic uses described above are the Company's initial
intended uses for its keratome, the Company recognizes that other uses may
eventually be made of the waterjet keratome. One such use, for which the
Company believes the potential market could be significant, is for refractive
surgical correction. Therefore, the later phase of the Company's FDA strategy
relates to the HRK Keratome. Although the Company believes that the HRK
Keratome will be considered for permission to market by the FDA through a 510(k)
notification based upon the similarities of the keratome between the HTK uses
and the HRK use, obtaining such permission for the HRK Keratome is likely to be
somewhat more complicated than for HTK. There can be no assurance that either
the HTK use or the HRK use will be permitted for marketing by the FDA. The
differences between the two uses are found in the components, other than the
waterjet scalpel, which comprise the keratome. For the HRK Keratome, the
Company may be required to show that the procedure is effective, stable and does
not decrease visual acuity to any significant extent.

The Company believes that, based on three features of the HRK Keratome, it
will also be considered for 510(k) notification by the FDA. First, based on the
preliminary experimentation conducted with waterjet keratomes, there are no
known or anticipated physical or chemical processes that would impact on the
safety of the HRK procedure. The waterjet keratome cuts by mechanisms similar
to that of conventional scalpels (although at speeds of more than 100 times
greater), except that the Company believes that HRK would not produce certain
side effects incident to other refractive surgery procedures. Such side effects
include the inferior cut produced by the oscillating blade used in conventional
keratomes, and the potential carcinogenic effects, dehydration from overheating
and high amplitude shock waves to the eye resulting from the high energy, pulsed
radiation used in a procedure known as photo-refractive keratotomy ("PRK"). PRK
could represent the strongest competition to HRK. As a result of the
anticipated safety issues, the FDA approval process for PRK involved numerous
clinical studies on human eyes and took several years to complete. The Company
believes that the FDA approval process for the HRK Keratome should be shorter
and entail fewer clinical studies in light of the expected higher level of
safety and lack of anticipated side effects, in comparison to other previously
permitted products.

The second feature of the HRK Keratome is the benign nature of the waterjet
cut. While a conventional scalpel tears the lamellae (layers of the stroma) and
PRK completely or partially destroys the surface lamellae, the waterjet beam has
a unique cutting action which separates the various lamellae prior to cutting
the targeted tissue, thereby preserving the integrity of the remaining lamellae
and both localizing and minimizing the damage to the lamellae generally. The
healing process following a waterjet cut is expected to be less traumatic than
that following a conventional scalpel cut or a PRK cut, although the improved
healing process has not yet been demonstrated.

The third feature of the HRK Keratome is that the portion of the corneal
tissue targeted for removal is extracted in a single piece similar to a contact
lens. The Company is developing and experimenting with an in-vitro model which
would allow intact removal of the targeted portion of corneal tissue and
comparison to the expected refraction, in effect producing a definitive model of
the relationship between the template shape and the refractive result. The
efficacy requirement of such experimentation is to demonstrate validity in
humans of the in-vitro model, a less demanding requirement than demonstrating
validity on live human eyes. The Company believes that the

clinical studies would be primarily directed toward validating this model and
that the 510(k) notification process would be relatively short and consist of
tests on a limited number of live eyes.

With the net proceeds of this Offering, the Company intends to continue the
research and development of its keratome and related manufacturing processes and
to commence human clinical trials of the HRK Keratome. See "Plan of Operation."
If the HTK Keratome or the HRK Keratome is permitted to be marketed or otherwise
approved for marketing in the United States, the Company will be required to
establish a marketing organization and production facilities, which will require
additional financing. No assurance can be given that the Company's research and
development efforts will be successfully completed, that the HTK Keratome or HRK
Keratome will prove to be safe and effective in correcting vision, that the HTK
Keratome or HRK Keratome will be permitted to be marketed or otherwise approved
for marketing by the FDA or any other regulatory agency, or that the HTK
Keratome or HRK Keratome or any other product developed by the Company will be
commercially successful.

DISEASES OF THE CORNEA AND THERAPEUTIC TREATMENT

The cornea is the clear window that, in addition to allowing light into the
eye for the purpose of vision, provides most of the focusing power of the vision
system of the eye. The anterior surface of the cornea is covered with a thin
layer called the epithelium. Although the epithelium has no blood cells, it has
nerve cell endings which can be a source of pain in the cornea.

There are several circumstances under which the epithelium is removed from
a cornea. An epithelium that is eroded, cut, damaged, dystrophied or diseased
can be partially or fully removed and will regenerate to cover the cornea with
healthy tissue. The epithelium is also removed prior to refractive surgery
using a laser. In addition, in certain diseases of the cornea that render it
partially or completely opaque, the cornea may be partially or fully removed and
replaced with a donor cornea from an eyebank. Certain of such transplants are
performed with a keratome that removes a partial thickness of tissue in a
procedure known as lamellar keratoplasty.

Removal of the epithelium is typically done with a hand-held, number 11
steel scalpel which is mechanically scraped across the cornea to accomplish the
removal of the epithelium in a rough and imprecise manner, often damaging the
layer of tissue underlying the epithelium. The Company believes that by
adjusting the water pressure to be used, its waterjet keratome can precisely cut
only the epithelium in the defined area targeted for removal by separating such
area from the adjoining underlying tissue without damaging such underlying
tissue.

In the therapeutic application of the HTK Keratome, the thickness and
diameter of the removed tissue can be predetermined. The smooth and precise cut
of the HTK Keratome allows for relatively simple positioning of the replacement
(donor) tissue after removal of the targeted tissue and relatively quick
healing.

REFRACTIVE DISORDERS AND CORRECTION

The human eye consists of a hollow, flexible globe approximately 25
millimeters in diameter, which is filled with a vitreous fluid. The optical
part of the eye functions much like an automatic focus video camera,
incorporating a variable focus lens system (the fixed focus cornea and the
variable focus internal lens) which adjusts the sharpness of the image on the
retina, a variable aperture system (the iris) which regulates the amount of
light

-27-

falling on the retina, and a sensory array (the retina) which converts the
focused image into electrical signals which are transmitted through the optic
nerve to the brain for image processing and storage to achieve the best image.
Approximately 70% of the focusing power of the eye resides in the cornea. The
precise focusing power of the cornea is a function of the curvature of the
anterior corneal surface. The internal lens of the eye also has focusing power
and the ability to adjust its focusing power to achieve the best focus for near
or far objects; however, its ability to so adjust is limited and tends to
decrease with age, ultimately disappearing.

Most common refractive problems result from an inability of the optical
system of the eye to focus images on the retina properly with normal
accommodation. The extent of this inability to focus is known as refractive
error. For instance, in the nearsighted eye, light rays from an object at a
distance of 20 feet focus in front of the retina, because the curvature of the
cornea is too great. People with uncorrected myopia see nearby objects clearly,
but distant objects appear blurry, even with accommodation. Conversely, in the
uncorrected farsighted eye, light rays from an object at a distance of 20 feet
focus behind the retina because the curvature of the cornea is too low. People
with hyperopia see distant objects clearly, but may need correction so that
nearby objects do not appear blurry. In the astigmatic eye, the curvature of
the cornea is not uniform. This lack of uniform curvature makes it impossible
for a person to focus clearly on an object at any distance without correction.

Refractive power is measured in diopters. The current ophthalmic
measurement technology and the techniques for manufacturing eyeglasses and
contact lenses produce a refractive correction that is within +/- 1/4 diopter of
the optimum value for ideal vision. This residual error is generally viewed as
acceptable for all purposes by ophthalmologists.

Vision disorders are currently treated primarily by eyeglasses, contact
lenses or surgery, all of which compensate for the existing refractive error.
Among the surgical techniques available to treat vision disorders are radial
keratotomy ("RK"), PRK and keratomileusis in situ ("KIS"). In RK, PRK and KIS,
the object of the surgery is to change the shape of the anterior corneal
surface, thereby eliminating or reducing refractive error.

RK is a surgical procedure used to correct myopia in which steel or diamond
knives are used to make a series of deep, perpendicular cuts in a radial
configuration around the periphery of the cornea outside the vision zone. The
incisions cause a flattening of the cornea and eliminate or reduce small to
moderate amounts of myopia. Tangential cuts are used to correct moderate
astigmatism, a technique known as astigmatic keratotomy.

PRK uses energy from a type of ultraviolet laser, known as an "excimer
laser," to correct various types of refractive disorders by changing the
curvature of the anterior corneal surface. The excimer laser emits ultraviolet
light in very short, high energy pulses and "photoablates," or vaporizes, part
of the anterior corneal surface to achieve a new curvature. PRK has been
approved for use in the United States by the FDA for the correction of low to
moderate myopia (I.E., under 6 diopters).

KIS, which is also known as refractive lamellar keratoplasty ("RLK") or
automated lamellar keratoplasty ("ALK"), involves using an automated metal or
diamond scalpel in a microkeratome to cut and pull back a corneal flap
(consisting of the epithelium, the Bowman's layer and a portion of the stroma)
and to then shave away a portion of the exposed stromal area of the cornea in a
second cut, thereby changing the corneal curvature after the flap is replaced.
Light ablation system for in-situ keratomileusis ("LASIK"), an investigational
procedure under FDA review, with FDA approval anticipated by the Company to be
at least one year away, combines elements of KIS and PRK. In the LASIK
technique, the corneal flap is pulled back, and photoablation is performed
directly on the exposed stromal surface to change its curvature. In both KIS
and LASIK, the hinged flap is reset as close as possible to its original
position, where it adheres to the underlying stroma.

RK and PRK produce corrections that are usually not optimum, typically
leaving the eye within +/- 1 diopter of optimum, but sometimes worse. The
corrections generally are not stable to within 1 diopter. This leaves the
patient able to function without eyeglasses or contact lenses but not with the
best possible vision and not under all conditions. The accuracy of KIS is
generally poorer, but it is typically used to correct larger myopia and is more
stable. See "-- Competition."

-28-

THE HRK KERATOME

GENERAL

The HRK Keratome uses a single, hair-thin, supersonic water beam with a
diameter of approximately 30 microns to incise corneal material and a
disposable, custom-made template to support and shape the cornea during surgery.
Other parts of the HRK Keratome include a miniature high pressure water storage
element and related equipment, which together produce the water beam; a scanning
mechanism to move the water beam across the cornea; a device to regulate and
control the action of the water beam; a force transducer to monitor the water
beam status; and a template designed to support and shape the eye during
surgery. The HRK Keratome will be placed on the patient's eye during the
surgical procedure. Once the HRK Keratome is placed into position on the eye
(directly over the area to be incised), to which it is attached by a globe
fixation device (a suction device to align and fix the eye in place relative to
the template and waterjet parts during surgery), the surgical cut takes less
than one second.

The total water volume used during the procedure, including the amount
necessary to check the waterjet beam and its performance, is less than a few
drops. Involuntary motions of the eye, including saccadic movement in which the
eye makes minute, constant side-to-side movements to assist in imaging, have no
impact during HRK because the eye is fixed to the HRK Keratome during the
procedure. The template for any procedure will be constructed according to the
specification provided by the ophthalmologist and will be provided to the
surgeon with the HRK Keratome.

HRK, with the HRK Keratome, can be done in three methods. In the first
method, a shaped slice of corneal tissue is removed without damage to the rest
of the cornea. The shape and size of the removed portion corresponds to the
error in refractive power of the cornea to be corrected, having the effect of
the permanent removal of the equivalent of a contact lens. In the other two
methods, a hinged flap is cut into the cornea and the underlying tissue is
reshaped before the flap is replaced. The Company believes that the first
method, without the creation of a flap (which the Company believes allows more
opportunity for infection, requires more surgical skill, offers the potential
for irregular astigmatism and results in a more complex healing process), is the
simplest and safest and initially intends to seek FDA permission to market, or
other approval, with respect to that method alone.

STATUS

To date the Company has spent approximately $1,100,000 on research and
development of the HTK Keratome and the HRK Keratome. Research and development
activities have consisted of developing, designing and constructing two
experimental versions of the Company's keratome, and, since July 1994,
conducting feasibility studies on approximately 1,000 porcine and rabbit
corneas, on approximately 25 human cadaver eyes and on 22 live rabbits. The
purpose of the feasibility studies was to determine if the water beam could
smoothly incise and shape the anterior surface of the cornea and to determine if
the incised eye would heal. The Company has been highly satisfied with the
results of the feasibility studies conducted to date. Specifically, the
Company, using light and electron microscopes and post incision casts, has
compared the cuts made by the waterjet scalpel with cuts made by scalpels and
lasers in other refractive surgical procedures. The Company believes that the
cuts made by the waterjet scalpel are cleaner and much less damaging than those
made by conventional scalpels and lasers. The Company has found the corneal
flaps created by the HRK Keratome to be extremely close to parallel, as desired,
and of the desired thickness (approximately 140 microns). The Company also found
the shape of the cut stromal bed to be the desired spherical shape and the
restored flap to fit the stromal bed with no discernable disparity in size or
alignment. The Company's studies have also shown that HRK incisions
(resections) heal with much less wound healing response and haze than results
from PRK incisions.

Pre-clinical research and development is being conducted by the Company
directly and, on the Company's behalf, by the University of Medicine and
Dentistry of New Jersey in Newark, New Jersey (the "University"). The Company
maintains a laboratory for its experiments at the University's animal facility
and has access to certain University diagnostic equipment. The Company has
agreed to pay the University $40,000 per year from July 1994 to June 1997 in
order to use such facilities for its research and development. Dr. Eugene I.
Gordon, the President of the Company, is an adjunct professor of ophthalmology
at the University. The Company's agreement with the

-29-

University calls for tests on 40 dutch belted rabbits and 40 cats with post-
operative follow-up and, subsequently, microscope studies on enucleated eyes.
The tests are carried out by Company personnel under the supervision of Prof.
Marco Zarbin, M.D., the Chairman of the University's Department of
Ophthalmology, who serves as the principal investigator.

The Company began construction in March 1996 of a keratome designed for
use in surgery on non-human primates and humans in a clinical setting. Due to
funding limitations, the Company has not yet constructed the manufacturing
equipment for making specifically designed templates. The Company believes that
the technology for producing specifically designed templates exists and that the
Company will be able to produce such equipment or license others to do so.
However, there can be no assurance that the Company will be able to do so at all
or in a timely and cost-effective manner.

PATENTS

The Company has sought to protect its proprietary interest in the HRK
Keratome by applying for patents in the United States and corresponding patents
abroad. In September 1994, a U.S. patent application was filed in the name of
Dr. Eugene I. Gordon and two employees of the Company, as inventors, which
application was assigned to the Company. The U.S. patent application, as
allowed for issuance, covers a method and device for use in the HRK Keratome,
including use of a template for corneal shaping and holding, during use of a
waterjet keratome device. A corresponding international application has been
filed, pursuant to the Patent Cooperation Treaty ("PCT"), with designation of
all member countries foreign to the United States, including but not limited to
Japan, the members of the European Patent Office, Canada, Mexico, Australia,
Russia, China and Brazil. The PCT filing has been published and separate patent
applications have been or will be filed pursuant to the PCT filing. In
addition, for countries not currently part of the PCT, patent applications have
also been filed in Israel, Taiwan and South Africa. A prior U.S. patent
application, filed in April 1994, is currently pending and relates to
topographic corneal mapping, which has utility for surgery utilizing the HRK
Keratome.

U.S. GOVERNMENT REGULATION

The components of the Company's HTK Keratome and HRK Keratome are medical
devices. Accordingly, the Company is subject to the relevant provisions and
regulations of the FD&C Act, under which the FDA regulates the manufacturing,
labeling, distribution, and promotion of medical devices in the United States.
The FD&C Act requires manufacturers of medical devices to, among other things,
comply with labeling requirements and manufacture devices in accordance with
prescribed GMPs, which require companies to manufacture and test their products,
exercise quality control and maintain related documentation in a prescribed
manner. The FD&C Act and regulations thereunder also require all medical device
manufacturers and distributors to register with the FDA annually, to provide the
FDA with a list of those medical devices which they distribute commercially and
to report death or serious injuries alleged to have been associated with the use
of their products, as well as product malfunctions that would likely cause or
contribute to death or serious injury if the malfunction were to recur. Certain
medical devices not cleared for marketing in the United States are required to
have FDA approval before they are exported. The FDA frequently inspects medical
device manufacturing and distribution facilities and has broad authority to
order recalls of medical devices, seize noncomplying medical devices, enjoin
and/or impose civil penalties on manufacturers and distributors marketing non-
complying medical devices and criminally prosecute violators.

Pursuant to the FD&C Act, the FDA classifies medical devices intended for
human use into three classes: Class I, Class II and Class III. In general, Class
I devices are those products for which the FDA determines that safety and
effectiveness can be reasonably assured through the FD&C Act general controls
relating to such matters as adulteration, misbranding, registration,
notification, record keeping and GMP. Class II devices are those products for
which the FDA determines that the general controls in the FD&C Act alone are
insufficient to provide a reasonable assurance of safety and effectiveness. The
FDA has promulgated special controls applicable to Class II devices, including,
but not limited to, performance standards, postmarket surveillance, patient
registries and specific testing guidelines. Class III devices are devices for
which the FDA has insufficient information to conclude that either general FD&C
Act controls or special controls would be sufficient to assure safety and
effectiveness, and

-30-

which are life-supporting, life-sustaining, of substantial importance in
preventing impairment of human health (E.G., a diagnostic device to detect a
life-threatening illness) or present a potential unreasonable risk of illness or
injury. Class III devices must undergo a rigorous pre-market approval process,
as described below.

The FD&C Act provides that, unless exempted by regulation, medical devices
may not be commercially distributed in the United States unless they have been
approved or cleared by the FDA. There are two review procedures by which medical
devices can receive such approval or clearance. Some products may qualify for
clearance under a 510(k) notification. Pursuant to that procedure, the
manufacturer submits to the FDA a pre-market notification that it intends to
begin marketing its product. The notification must demonstrate that the product
is substantially equivalent to another legally marketed product (I.E., that it
has the same intended use and that it is as safe and effective as, and does not
raise different questions of safety and effectiveness than does, a legally
marketed device). In some cases, the 510(k) notification must include data from
human clinical studies. In March 1995, the FDA issued a draft guidance document
in connection with 510(k) notifications for medical devices, "Addendum: How to
Submit a Premarket Notification [(510(k)]," which states that clinical data is
not needed for most devices cleared by the 510(k) process. However, the Company
anticipates that the FDA will require submission of human clinical trial data in
connection with the Company's 510(k) notifications.

A successful 510(k) notification will result in the issuance of an letter
from the FDA in which the FDA acknowledges the substantial equivalence of the
reviewed device to a legally marketed device and clears the reviewed device for
marketing to the public. Under FDA regulations, the FDA has a 90-day period to
respond to a 510(k) notification, although such response has been known to take
longer.

Based on a recommendation from the FDA, the Company intends to file two
510(k) notifications within approximately six months of the Effective Date, in
which the Company will seek to demonstrate that the HTK Keratome is
substantially equivalent to the currently available keratomes having a metal or
diamond scalpel used for two types of lamellar keratoplasty. Under current FDA
regulations, a keratome is defined as a device for shaving thin layers from the
cornea and is classified as a Class I device. The Company will seek to
demonstrate that, for the purpose of making lamellar, or substantially lamellar,
corneal incisions, the waterjet scalpel and template included in the HTK
Keratome are substantially similar to a keratome with a metal or diamond
scalpel.

There can be no assurance that the Company will obtain 510(k) premarket
notification clearance to market the HTK Keratome or, subsequently, the HRK
Keratome, in a timely manner or at all, that the Company's device will be
classified as a Class I device, or that, in order to obtain 510(k) clearance,
the Company will not be required to submit additional data or meet additional
FDA requirements that may substantially delay the 510(k) process and add to the
Company's expenses. Moreover, such 510(k) notification clearance, if obtained,
may impose conditions on the Company with respect to the marketing or
manufacturing of which may impede the Company's ability to market and/or
manufacture the HTK Keratome or the HRK Keratome. There can be no assurance
that the Company will be able to obtain necessary regulatory approvals or
clearances on a timely basis or at all. Delays in receipt of or failure to
receive such approvals, the loss of previously received approvals, or failure to
comply with existing or future regulatory requirements will have a material
adverse effect on the Company.

In addition to laws and regulations enforced by the FDA, the Company's
products may also be subject to labelling laws and regulations enforced by the
Federal Trade Commission. The Company is also subject to government regulations
applicable to all businesses, including, but not limited to, regulations related
to occupational health and safety, workers' benefits and environmental
protection.

FOREIGN GOVERNMENT REGULATION

Sales of medical devices outside the United States are subject to foreign
regulatory requirements that vary widely from country to country. The time
required to obtain approvals required by foreign countries may be longer or
shorter than that required for FDA approval, and requirements for licensing may
differ from FDA requirements. Export sales of investigational devices that have
not received FDA marketing clearance generally are subject to FDA export permit
requirements. Material failure to comply with any applicable regulatory
requirements could have a material adverse effect on the Company.

-31-

MARKETS

In the United States, more than 145 million people wear either eyeglasses
or contact lenses. Over $13 billion is spent annually in the United States for
corrective eyewear products. Studies indicate that approximately 29 million
Americans wear contact lenses, primarily for cosmetic or convenience reasons.
The number of people in the United States newly electing to wear contact lenses
is over one million per year. This large and growing population of contact lens
wearers is the largest potential market for refractive surgery, including HRK.
Studies indicate that approximately 60% of persons electing refractive surgery
are contact lens wearers. However, there can be no assurance that eyeglass or
contact lens wearers will elect to undergo surgery.

The only refractive surgery techniques generally available in the United
States today are RK, PRK and automated lamellar keratoplasty, or ALK. The
Company believes that approximately 7 million RK procedures (each "procedure"
being performed on a single eye) have been performed worldwide, and
approximately 1.5 million in the United States, in the last 15 years. The
Company believes that approximately 5,000 PRK procedures have been performed in
the United States, with a total of several hundred thousand worldwide. The
American Society of Cataract and Refractive Surgeons has estimated that the
number of PRK procedures performed in the United States will grow to over 1
million annually within the next few years. The Company estimates that 5,000
ALK procedures are performed in the United States each year by approximately 100
surgeons and that approximately 350 ALK microkeratomes have been sold in total.

The Company anticipates that the initial market for the HRK Keratome will
be ophthalmologists, many of whom already are familiar with PRK, RK and ALK.
The American Medical Association estimates that there are currently 15,000
ophthalmologists in the United States, of which 12,000 are in private practice
and 3,000 are associated with hospitals, teaching institutions and the military.

The degree to which the Company's HRK Keratome can penetrate the potential
market of ophthalmologists will depend on a variety of factors, including, but
not limited to, acceptance by the medical community and the public of the HRK
Keratome and alternative technologies. None of these factors is under the
control of the Company. There is presently no data available to the Company to
determine what percentage HRK will have of the market for refractive surgery.

COMPETITION

If permitted or otherwise approved by the FDA and other regulatory
authorities, the primary competition for the HTK keratome will be a hand-held,
number 11 steel scalpel which is mechanically scraped across the cornea to
accomplish the removal of the epithelium, and other mechanical blades, which cut
diseased tissue intended for removal. The use of such keratomes requires a high
degree of skill and training and often does not produce satisfactory results.

If permitted or otherwise approved by the FDA and other regulatory
authorities, HRK using the Company's HRK Keratome will compete with other
treatments for refractive problems, including eyeglasses, contact lenses, other
refractive surgery procedures (such as RK, PRK and ALK), and other technologies
under development, such as LASIK, refractive intraocular lenses (lenses which
are inserted into the eye behind the cornea), intrastromal lenses (lenses which
are inserted into the stroma), corneal rings (transparent circles of acrylic
which are inserted within the cornea outside the vision zone in order to correct
the curvature of the corneal surface) and injection of hydrogel materials into
layers of corneal tissue to change the curvature of the cornea. The healthcare
field is characterized by rapid technological change. At any time, competitors
may develop and bring to market new products or surgical techniques with vision
correction capabilities superior to those of the HRK Keratome or which would
otherwise render the HRK Keratome obsolete.

Generally, refractive surgical techniques are considered to be "elective"
surgery and are typically not reimbursed under healthcare insurance policies in
the United States. However, in certain countries outside the United States,
such as China, the costs of refractive surgery are paid by the government,
because it is believed that such surgery is, over time, less costly than glasses
or contact lenses. It can be expected that many individuals will choose to
forego refractive surgery, if not reimbursed, and instead obtain eyeglasses or
contact lenses, which are

-32-

covered under some healthcare insurance plans and are considerably less
expensive than refractive surgery in the short term.

Other companies, most of which are larger and better financed than the
Company, are engaged in refractive surgery research. Two companies, Summit
Technology, Inc. ("Summit") and VISX Inc. ("VISX"), have completed Phase III
clinical studies in the United States to evaluate PRK for the treatment of
myopia. Both companies have received a PMA. In addition to Summit and VISX,
there are a number of other large entities that currently market and sell laser
systems overseas for use in refractive surgery, including Aesculap-Meditec GmbH,
Chiron-Technolas and Schwind, each of Germany, and Nidek of Japan. Many of
these companies have substantially greater financial, technical and human
resources than the Company and may be better equipped to develop, manufacture
and market their technologies. In addition, many of these companies have
extensive experience in preclinical testing and human clinical studies. Certain
of these companies may develop and introduce products or processes competitive
with or superior to those of the Company. Furthermore, if the Company is
permitted to commence commercial sales of products, it will also be competing
with respect to manufacturing efficiency and marketing capabilities, areas in
which the Company has no experience.

The Company's competition will be determined in part by those refractive
surgery technologies that are ultimately approved for sale by regulatory
authorities. The relative speed at which the Company is able to develop the HRK
Keratome, complete the necessary governmental and regulatory approval processes,
and manufacture and market commercial quantities thereof will be important
competitive factors.

Although the HRK Keratome is still in the early stages of development and
has neither been tested on live human eyes nor received the regulatory approval
necessary for sale, the Company believes that it has the potential to
effectively compete with other refractive surgical techniques because of its
relative simplicity, safety, efficacy and reduced risk of significant pain.
Each of these factors is discussed below.

SIMPLICITY. The Company's keratome is designed to allow ophthalmic
surgeons to perform HTK and HRK with relative ease. In the HRK Keratome, the
waterjet is controlled by a switch, the eye is aligned and fixed in place during
the procedure by means of the globe fixation device and the template is used to
determine exactly how much of the corneal tissue is excised. Accordingly,
whereas procedures such as ALK and LASIK are difficult and require that the
ophthalmic surgeon possess a high level of surgical skill, the HRK procedure is
largely automatic and, accordingly, the ophthalmologist will not be required to
operate manually on the cornea or perform manual adjustments or calculations in
connection with the surgery. Further, the fact that the eye is fixed in place
during the HRK procedure eliminates the surgical risk of error due to the
natural saccadic movement of the human eye in which the eye makes minute,
constant side-to-side movements to assist in imaging.

SAFETY. HRK is designed to minimize invasiveness and trauma to the cornea.
Unlike RK, but like ALK, HRK does not require deep incisions into the cornea
with the potential for perforation and weakening of the cornea. Unlike PRK, the
Company's HRK procedure does not result in heating the cornea, nor does it
hydrate or dehydrate the corneal tissue. PRK also has the potential to lacerate
the stromal surface, expose the eye to potentially carcinogenic ultraviolet
light and free radicals, produce high amplitude acoustic pulses which sometimes
cause subretinal hemorrhages or leave a residue of scar tissue and haze, all of
which can have negative effects on the cornea and the patient's ability to see
properly or at all. Unlike ALK, the Company's procedure does not require high
intraocular pressure ("IOP") with its attendant risk of inducing glaucoma or
retinal detachment. ALK also poses a risk of residual metal chips in the flap-
stroma interface from the blade edge. In addition, because HRK is largely
automatic and requires no manual adjustments or calculations or control by
software, the Company believes that HRK has the potential to promote more
consistent outcomes. For these reasons, the Company believes that the HRK
Keratome will, if permitted or otherwise approved, provide a safer method of
refractive correction than other methods available to consumers. However, the
experiments on live humans which are expected to prove such belief have not yet
been conducted.

EFFICACY. Efficacy refers to the ability of a surgical technique to
achieve the desired result with a minimum of adverse side effects. The Company
believes that, once conducted, research will show a high level of efficacy with
HRK when compared with efficacy of other refractive surgical procedures.

-33-

Studies have shown that RK does not regularly achieve optimum vision
correction; residual refractive error can be as large as +/- 1 diopter,
sometimes with some small loss in visual acuity. RK has been reported to cause
adverse side effects, such as halo (I.E., appearance of a bright spot with a
surrounding area of confusion) and glare, and to result in diurnal fluctuations
in refractive correction and unstable post-operative correction due to weakening
of the cornea from the multiple corneal incisions. Such weakening often
results in progress toward hyperopia over a period of up to 10 years following
the surgery, with changes as large as several diopters in patients with moderate
to high myopia before the surgery. A significant number of RK procedures are
repeated as a result of inaccurate correction. There is also a higher risk of
post-operative infections from RK than PRK, due to the number and depth of the
incisions made.

Studies have shown that when PRK is used on patients with low to moderate
myopia, the post-operative refractive correction is not predictable within +/- 1
diopter. Generally, the range of inaccuracy varies directly with the degree of
attempted change. Following PRK surgery, some patients' vision has been
reported to regress toward myopia over a period of approximately one year
following the surgery and some patients report haze. The Company believes that
these inaccuracies and instability are the result of the photoablation process,
which causes a variety of wound-healing responses which are difficult to
predict. As with RK, the achieved correction following PRK is adequate, in most
cases, to allow a patient to perform typical daily functions, such as driving,
without vision assistance; however, optimum vision correction is not typically
achieved without the use of eyeglasses or contact lenses. Furthermore, patients
undergoing PRK generally require a period ranging from several days to two weeks
before vision is restored, whereas vision is generally restored in patients
undergoing RK or ALK within a short time or immediately following those
procedures. In up to 5.0% of PRK procedures, permanent loss of visual acuity
(as much as two lines or more on the standard eye chart) has been reported.
Subretinal hemorrhages, induced in the operated eye by the procedure sometimes
occur and have been reported to have caused blindness in a very small percentage
of PRK patients. Based on experimental data, LASIK appears to be comparable to
PRK with respect to post-operative refractive error but more stable as a result
of a more predictable wound-healing response. However, it has the potential for
flap-related problems.

ALK is generally regarded as highly inaccurate but useful for correcting
high myopia and hyperopia and is reasonably stable. Studies have shown that in
some cases, the epithelium under the flap will regenerate after the ALK
procedure, requiring removal of the flap and/or cleaning of the interface.
Accurate realignment of the flap after such procedure is difficult and can
produce irregular astigmatism.

HRK is similar to PRK, but the Company believes it will allow more accurate
correction of high and low myopia, hyperopia and astigmatism. The expected
accuracy of the Company's HRK procedure is based on the use of a custom template
to flatten and shape the stroma, so as to reliably shave the proper amount of
tissue to achieve the desired correction. However, the Company has not yet
conducted human clinical trials and, accordingly, the Company has not yet
demonstrated that in live human eyes, the mechanical properties of the stroma
are similar enough that a given template will consistently shave exactly the
same amount of tissue. The Company also anticipates that the cleanness of the
HRK incisions, together with the fact that the epithelium is not scraped off
during HRK, may result in a lower incidence of post-operative infections.
However, no assurances can be given that the safety and efficacy of HRK
anticipated by the Company will be realized.

REDUCED RISK OF SIGNIFICANT PAIN. The Company anticipates that patients
who undergo HRK utilizing the HRK Keratome will not experience significant pain
as compared with the pain reported to result from other refractive surgical
procedures. The pain following refractive surgery through PRK is primarily due
to the scraping off from the cornea of a portion of the epithelium, which
contains most of the nerve endings in the cornea. Less pain is associated with
merely cutting through the epithelium in a limited region, such as in RK and
ALK. In the Company's HRK procedure, only a small cut is made into the
epithelium, similar to that made in ALK and possibly more cleanly, which the
Company anticipates should result in minimal pain.

In addition to the competitive factors listed above, HRK is expected to be
less costly than PRK, because of the high costs of the laser equipment and laser
facility necessary for PRK, and to be competitively priced with, or less costly
than, other refractive surgery procedures.

-34-

LITIGATION

The Company is not a party to any pending litigation, nor is it aware of
any litigation threatened against it. The Company is involved in a contract
dispute in which the amount in controversy is less than $35,000.

EMPLOYEES

As of May 1, 1996, the Company had nine full-time employees, all of whom,
including its President, were engaged in research and development activities,
and one part-time employee. As of such date, the Company also had consulting
arrangements with one medical consultant, one marketing consultant and two
strategic planning and business development consultants. The Company's ability
to design, develop, manufacture, market and sell its products successfully will
depend to a large extent on its ability to attract and retain qualified
personnel, for which competition is or may be intense. None of the Company's
employees are represented by a union. The Company believes that its relations
with its employees are satisfactory.

FACILITIES

The Company leases approximately 4,982 square feet of research and
development and office space in Edison, New Jersey. The term of the lease
expires in March 1999. The base rent is $57,440 per year. The Company believes
that nearby space suitable for a manufacturing facility is in adequate supply.

PRODUCT LIABILITY INSURANCE

The use of medical devices, both in clinical and commercial settings,
entails the risk of allegations of product liability, and there can be no
assurance that substantial product liability claims will not be asserted against
the Company. The Company does not now have any product liability insurance, but
it expects to obtain such insurance prior to the commencement of clinical
testing. It is expected that such insurance will be in the amount of $1 million
per claim with an annual aggregate limit of $20 million. After any
commercialization of its products, the Company will seek to obtain an
appropriate increase in its coverage. However, there can be no assurance that
adequate insurance coverage will be available at an acceptable cost, if at all.
Consequently, a material product liability claim or other material claims with
respect to uninsured liabilities or in excess of insured liabilities would have
a material adverse effect on the Company.

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MANAGEMENT

EXECUTIVE OFFICERS AND DIRECTORS

The following table sets forth certain information with respect to the
executive officers, directors and nominees for director of the Company:

NAME AGE POSITION
---- --- --------

Eugene I. Gordon, Ph.D. 65 President and Chairman of the Board
Thomas M. Handschiegel 49 Vice President for Finance and Human
Resources
Steven G. Cooperman, M.D. 54 Director
Sanford J. Hillsberg* 48 Director
Steven Katz, Ph.D.** 51 Director

_____________________
*Mr. Hillsberg was elected as a director to begin serving upon the consummation
of this Offering.
**Mr. Katz was elected as a director to begin serving 30 days after the
Effective Date.

Prior to the commencement of the Offering, the Company intends to elect one
additional person to the Board of Directors of the Company. Such person will
not be an officer or employee of the Company.

DR. EUGENE I. GORDON is the founder and President of the Company and has
been a Director and Chairman of the Board since its inception in December 1993.
He is an inventor of the Company's HRK Keratome technology. From 1987 to 1988,
Dr. Gordon served as Senior Vice President and Director of the Research
Laboratories for Hughes Aircraft Co. of Malibu, California. Dr. Gordon has
served as an adjunct professor in the Department of Ophthalmology at the
University of Medicine and Dentistry of New Jersey since 1994, and was a
professor in the Department of Electrical and Computer Engineering at the New
Jersey Institute of Technology from 1990 to 1995. Dr. Gordon was Laboratory
Director for AT&T Bell Laboratories and the founder of Lytel Incorporated, a
manufacturer of lasers and optical transmission subsystems which is a wholly-
owned subsidiary of AMP Incorporated. Dr. Gordon has done extensive research on
laser and opto-electronic systems, is a named inventor under approximately 70
U.S. patents and has published widely on those subjects. Dr. Gordon has a Ph.D.
in physics from the Massachusetts Institute of Technology. He is a member of
the National Academy of Engineering and has been awarded the Edison Medal of the
Institute of Electrical and Electronic Engineers, among a number of other
prestigious awards.

DR. STEVEN G. COOPERMAN has been a Director of the Company since September
1994. Dr. Cooperman was engaged in the private practice of ophthalmology and
ophthalmic surgery in Beverly Hills, California from 1972 to his retirement in
1989. Since his retirement, Dr. Cooperman has been active as a private
investor. He is the founder of the American Intraocular Implant Society (now
known as the American Society for Cataract and Refractive Surgery), has served
on the teaching staff of the Jules Stein Eye Institute and has lectured widely
on phacoemulsification and intraocular lens implant surgery. Dr. Cooperman
received his M.D. from the Northwestern University Medical School.

THOMAS M. HANDSCHIEGEL has been an executive officer of the Company since
March 1996. Mr. Handschiegel has been a Certified Public Accountant since 1980.
From November 1995 to March 1996, he served as Senior Managing Director of
Gruntal & Co. Incorporated. From 1994 to November 1995, Mr. Handschiegel was
self-employed as an independent financial consultant. From 1993 to 1994, he
served as Senior Vice President and Division Financial Officer, Industry
Services Group for Cowen & Company. From 1989 to 1993, he served as Vice
President, Comptroller and Chief Accounting Officer for Discount Corporation of
New York. Mr. Handschiegel received a B.B.A. in Accounting from Loyola
University (Chicago) in 1969.

-36-

SANFORD J. HILLSBERG has agreed to serve as a director of the Company upon
the consummation of this Offering. Mr. Hillsberg has been engaged in the
private practice of corporate law since 1973 and is currently the managing
partner of Troy & Gould Professional Corporation. From 1983 to 1993, he served
as a director and Vice President of Medco Research Inc., a publicly-traded
pharmaceutical research and development company. Mr. Hillsberg received his
J.D. from Harvard Law School.

DR. STEVEN KATZ has agreed to serve as a director of the Company commencing
30 days after the Effective Date. Dr. Katz is the President, Chief Executive
Officer, Chairman of the Board and a founder of Ortec International, Inc., a
publicly-traded company which has developed proprietary technology to create
natural replacement skin. He has been employed by Ortec International, Inc. and
a predecessor since 1991. Dr. Katz has also been a professor of Economics and
Finance at Bernard Baruch College in New York City since 1972. He has a Ph.D.
in Finance and Statistics as well as an M.B.A. and M.S. in Operations Research,
both from New York University.

All directors hold office until the next annual meeting of stockholders and
the election and qualification of their successors. Executive officers are
elected by the Board of Directors to hold office for such term as may be
prescribed by the Board of Directors.

The Board of Directors has established a Stock Option Committee which
administers the Stock Option Plan. The Stock Option Committee is currently
composed of one member, Dr. Gordon, and, upon the closing of the Offering, will
be composed of two members, Dr. Cooperman and Mr. Hillsberg.

KEY EMPLOYEE

The following individual is a key employee of the Company:

PERETZ M. FEDER has served as Vice President for Biological Studies and
Applications and Comptroller of the Company since 1994. His responsibilities
include safety and efficacy of the Company's animal studies. Prior to joining
the Company, Mr. Feder served for five years as Vice President of Research and
Development and later as General Manager for Photon Imaging Corporation, where
his responsibilities included imaging science for hard copy printer design,
optical and fiber optics design, and manufacturing. Mr. Feder received an M.S.
in electrical engineering from Columbia University in 1981.

DIRECTORS' COMPENSATION

Directors who are officers or employees of the Company receive no
additional compensation for service as members of the Board of Directors or
committees thereof. Outside directors will be reimbursed for out-of-pocket
expenses incurred in connection with attendance of meetings of the Board of
Directors. Upon consummation of the Offering and upon each election as director
thereafter, outside directors will receive options under the Stock Option Plan
to purchase 4,000 shares of Common Stock with an exercise price equal to the
fair market value per share of the Common Stock on the date of grant and which
shall vest one year after the date of grant if such director has served as such
for that full year. The exercise price for the initial grants to directors upon
consummation of the Offering will be $5.60 per share.

EMPLOYMENT AGREEMENTS

Effective as of March 15, 1996, the Company entered into an employment
agreement with Eugene I. Gordon as President, for an initial term of three
years. The agreement provides for a base compensation of $125,000 per year and
bonuses and other additional compensation as may be determined by the Board of
Directors (without the participation of Dr. Gordon) in its sole discretion. The
Board of Directors (without the participation of Dr. Gordon) may also increase
such base compensation in its sole discretion. The agreement may be terminated
for cause and contains proprietary information, invention and non-competition
provisions which prohibit disclosure of any of the Company's proprietary
information and preclude competition with the Company for two years after
termination of employment. The Company has procured life insurance in the
amount of $500,000 to compensate

-37-

it for the loss, through death, of Dr. Gordon, who is 65 years old. The Company
has arranged to increase such coverage (i) in connection with the Offering, to
$1 million compensation and (ii) in accordance with the employment agreement,
for the loss through disability as well as death of Dr. Gordon. However, there
can be no assurance that the Company will be able to obtain such additional
coverage at an acceptable cost or at all.

Effective as of March 18, 1996, the Company entered into an employment
agreement with Thomas M. Handschiegel as Vice President for Finance and Human
Resources, for an indefinite term. The agreement provides for a base
compensation of $95,000 per year. The agreement may be terminated by either
party at any time upon two weeks' prior notice and contains proprietary
information, invention and non-competition provisions which prohibit disclosure
of any of the Company's proprietary information and preclude competition with
the Company for two years after termination of employment.

EXECUTIVE COMPENSATION

The following table sets forth the aggregate compensation paid to the
Company's Chief Executive Officer in 1995. No other executive officer of the
Company was paid any other compensation from the period of the Company's
inception through December 31, 1995.

SUMMARY COMPENSATION TABLE

OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION
- --------------------------- ---- ------ ----- ------------

Eugene I. Gordon, Ph.D. 1995 $96,400 -- $66,700(1)

- -------------------------
(1) Consists entirely of deferred 1994 salary.

The Stock Option Committee intends to make a grant of 10,000 stock options
under the Stock Option Plan effective upon the Effective Date to Mr.
Handschiegel, which will vest, as to 25%, one year from the date of grant and,
as to the remainder, ratably over the following three-year period.

1994 STOCK OPTION PLAN

The Stock Option Plan has been adopted by the Company's Board of Directors
and approved by its stockholders. The Underwriting Agreement restricts the
Company from granting, after the date of this Prospectus, options to purchase
more than 200,000 shares of Common Stock under the Stock Option Plan, and from
registering any shares covered by the Stock Option Plan, without the prior
written consent of the Underwriter, until 24 months after the Effective Date.
Upon expiration of that period, the Company intends to file a registration
statement on Form S-8 covering all shares issuable upon the exercise of stock
options that may be granted under the Stock Option Plan.

ADMINISTRATION. The Stock Option Plan is administered by the Stock Option
Committee of the Board of Directors. The Stock Option Committee interprets the
terms, and establishes administrative regulations to further the purposes, of
the Stock Option Plan, authorizes awards to eligible participants, determines
vesting schedules and takes any other action necessary for the proper
implementation of the Stock Option Plan. Members of the Stock Option Committee
must be "disinterested" within the meaning of Rule 16b-3 under the Exchange Act.

PARTICIPATION. Under the Stock Option Plan, options to purchase shares of
Common Stock of the Company may be granted only to employees (including
officers) and directors of the Company or individuals who are rendering services
to the Company as consultants, advisors or other independent contractors.

SHARES AVAILABLE FOR AWARDS. 249,688 shares of Common Stock of the Company
have been reserved for issuance under the Stock Option Plan, subject to
adjustment for stock splits, stock dividends, recapitalizations and similar
events. Such shares may consist in whole or in part of authorized and unissued
shares or treasury shares. In the event that any outstanding option for any
reason expires or is terminated or canceled and/or shares of

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Common Stock subject to repurchase are repurchased by the Company, the shares
allocable to the unexercised portion of such option or repurchased shares,
may again be subject to an option grant. Notwithstanding the foregoing, any
such shares shall be made subject to a new option only if the grant of such
new option and the issuance of such shares pursuant to such new option would
not cause the Stock Option Plan or any option granted under the Stock Option
Plan to contravene Rule 16b-3 under the Exchange Act.

AWARDS. The Stock Option Plan authorizes grants of either incentive stock
options ("ISOs"), as defined in Section 422 of the Code, or non-statutory
(nonqualified) stock options. Under the Stock Option Plan, all options must be
granted, if at all, within 10 years from the earlier of the date the Stock
Option Plan is adopted by Board of Directors or the date the Stock Option Plan
is approved by the stockholders of the Company. The Stock Option Committee
shall set, including by amendment of an option, the time or times within which
each option shall be exercisable or the event or events upon the occurrence of
which all or a portion of each option shall be exercisable and the term of each
option; provided, however, that (i) no option shall be exercisable after the
expiration of 10 years after the date such option is granted and (ii) no ISO
granted to an Optionee who at the time the option is granted owns stock
possessing more than 10% of the total combined voting power of all classes of
stock of the Company within the meaning of Section 422(b)(6) of the Code (a "Ten
Percent Owner Optionee") shall be exercisable after the expiration of five years
after the date such option is granted. The Company has agreed with the
Underwriter not to issue shares of common Stock without the Underwriter's prior
written consent, during the 24 months following the Effective Date, other than
pursuant to the Stock Option Plan. As of the date of this Prospectus, non-
statutory stock options to purchase a total of 23,850 shares of Common Stock
have been granted to Steven G. Cooperman, a director of the Company, and ISOs to
purchase an additional 25,838 shares of Common Stock have been granted to
employees of the Company. The Company has agreed with the Underwriter that it
will not issue options to purchase more than 200,000 shares of Common Stock
during the 24-month period following the Effective Date without the
Underwriter's prior written consent, and that of such number, it will not issue
options to purchase more than 50,000 shares of Common Stock at less than fair
market value on the date of grant. The Company has also agreed with the
Underwriter that the options with respect to the 200,000 shares under the option
Plan which have not yet been granted as of the date of this Prospectus shall
vest no earlier than one year from the date of grant.

STOCK OPTIONS. The Stock Option Plan provides that (i) the exercise price
per share for an ISO shall not be less than the fair market value, as determined
by the Stock Option Committee, of a share of Common Stock on the date of the
granting of the option; and (ii) no ISO granted to a Ten Percent Owner Optionee
shall have an exercise price per share less than 110% of the fair market value,
as determined by the Stock Option Committee, of a share of Common Stock on the
date of the granting of the option. Notwithstanding the foregoing, an option
may be granted with an exercise price lower than the minimum exercise price set
forth above if such option is granted pursuant to an assumption or substitution
for another option in a manner qualifying within the provisions of Section
424(a) of the Code.

FEDERAL INCOME TAX CONSEQUENCES. The federal income tax consequences of
awards granted pursuant to the Stock Option Plan under the Code, and the
regulations thereunder are summarized below.

The grant of a stock option will create no immediate tax consequences for
the participant or the Company. The participant will have no taxable income
upon exercising an ISO (except that an alternative minimum tax may apply), and
the Company will not receive a deduction when an ISO is exercised. If the
participant does not dispose of the shares acquired on exercise of an ISO within
the two-year period beginning on the day after the grant of the ISO or within
one year after the transfer of the shares to the participant, the gain or loss
on a subsequent sale will be a capital gain or loss. If the participant
disposes of the shares within the two-year or one-year period described above,
the participant generally will realize ordinary income, and the Company will be
entitled to a corresponding deduction. Upon exercising a non-statutory stock
option, the participant must recognize ordinary income in an amount equal to the
difference between the exercise price and the fair market value of the Common
Stock on the exercise date, unless the shares are subject to certain
restrictions. The Company will receive a deduction for the same amount on the
exercise date (or the date the restrictions lapse).

-39-

With respect to other awards granted under the Stock Option Plan that are
settled in cash or shares of Common Stock that are either transferable or not
subject to a substantial risk of forfeiture, the participant must recognize
ordinary income in an amount equal to the cash or the fair market value of the
shares received. With respect to other awards granted under the Stock Option
Plan that are settled in shares of Common Stock that are subject to restrictions
as to transferability and subject to a substantial risk of forfeiture, the
participant must recognize ordinary income in an amount equal to the fair market
value of the shares received at the first time the shares become transferable or
not subject to a substantial risk of forfeiture, whichever occurs earlier. The
Company will receive a deduction for the amount recognized as income by the
participant, subject to the provisions of Section 162(m) of the Code, which
provides for a possible denial of a tax deduction to the Company for
compensation for any of the five most highly compensated executive officers in
excess of $1 million in any year.

The tax treatment upon disposition of shares acquired under the Stock
Option Plan will depend on how long the shares have been held. In the case of
shares acquired through exercise of an option, the tax treatment will also
depend on whether or not the shares were acquired by exercising an ISO. There
will be no tax consequences to the Company upon the disposition of shares
acquired under the Stock Option Plan, except that the Company may receive a
deduction in the case of disposition of shares acquired under an ISO before the
applicable holding period has been satisfied.

SCIENTIFIC ADVISORY BOARD

The Company has recently formed a Scientific Advisory Board to advise and
consult with management and the Board of Directors of the Company at such times
as the Board of Directors shall require on matters relating to the refractive
surgical device industry. Members of the Advisory Board may be employed on a
full-time basis by employers other than the Company, and may have commitments
to, or consulting or advisory contracts with, other entities that may limit
their availability to the Company. The Board of Directors has not to date
convened a meeting of the Scientific Advisory Board, but members of the
Scientific Advisory Board have provided consulting and other services to the
Company from time to time. The members of the Scientific Advisory Board are
Stephen G. Slade, M.D., a member of the clinical faculty in the Department of
Ophthalmology at the University of Texas Medical School; David M. Dillman, M.D.,
a specialist in cataract and refractive surgery; Marco Zarbin, M.D., the
Chairman of the Department of Ophthalmology at the University of Medicine and
Dentistry of New Jersey; and Theo Seiler, M.D., a Professor at Universitats
Klinikum Carl Gustav Carus in Dresden, Germany.

CONSULTANTS

The Company has retained Joseph F. Carroll, III as a consultant, to assist
and advise the Company in connection with market studies related to the HRK
Keratome. The Company does not pay Mr. Carroll a consulting fee. As
compensation for services rendered, and to be rendered, in the period from April
1994 to April 1998, the Company issued 29,813 shares of Common Stock to Mr.
Carroll in April 1994, which vest ratably over a four-year period.

The Company has also retained Dr. Joseph Calderone as a consultant, to
assist and advise the Company with respect to medical issues associated with
refractory surgery and clinical examination of animals under study. The Company
does not pay Dr. Calderone a consulting fee. As compensation for services
rendered, and to be rendered, in the period from April 1994 to April 1998, the
Company issued 29,813 shares of Common Stock to Dr. Calderone, which vest
ratably over a four-year period.

The Company has also retained Dr. Steven G. Cooperman, a director of the
Company, as a consultant, to assist and advise the Company with respect to
strategic planning and business development. The Company does not pay Dr.
Cooperman a consulting fee. As compensation for services rendered, the Company
issued warrants to purchase 89,439 shares of Common Stock, with an exercise
price of $3.37 per share, 25% of which shall vest at the completion of each year
of service until fully vested.

The Company has also retained Sanford J. Hillsberg, a director of the
Company, as a consultant, to assist and advise the Company with respect to
strategic planning and business development. The Company does not pay
Mr. Hillsberg a consulting fee. As compensation for services rendered, the
Company issued warrants to purchase

-40-

7,950 shares of Common Stock, with an exercise price of $3.37 per share, 25%
of which shall vest at the completion of each year of service until fully
vested.

-41-

PRINCIPAL STOCKHOLDERS

The following table sets forth certain information as of May 1, 1996 with
respect to the beneficial ownership of shares of Common Stock by (i) each person
known by the Company to be the beneficial owner of more than five percent of the
outstanding shares of Common Stock, (ii) each executive officer, director and
nominee for director of the Company and (iii) all executive officers and
directors of the Company as a group (assuming no exercise of the over-allotment
option):

PERCENTAGE OF OUTSTANDING SHARES OF COMMON STOCK
------------------------------------------------
NAME AND ADDRESS NUMBER OF
OF BENEFICIAL OWNER SHARES(1) BEFORE OFFERING AFTER OFFERING
- ------------------- --------- --------------- --------------

Eugene I. Gordon
1090 King Georges Post 1,591,687 65.0% 45.2%
Road Suite 301
Edison, NJ 08837

Thomas M. Handschiegel -0- -- --
1090 King Georges Post
Road
Suite 301
Edison, NJ 08837

Steven G. Cooperman(2)
201 Beagling Hill Circle
Fairfield, CT 06430 82,483 3.4 2.3

Sanford J. Hillsberg (3)
c/o Troy & Gould
1801 Century Park East
Suite 1700
Los Angeles, CA 90067 18,550 * *

Steven Katz (3)
8000 Cooper Avenue
Building 28
Glendale, NY 11355 -0- -- --

All executive officers and
directors of the Company as a
group (3 persons) (3) 1,692,720 69.1 48.0

________________
* Represents holdings of less than one percent.
(1) All shares owned directly unless otherwise noted.
(2) Includes 10,931 shares of Common Stock which Mr. Cooperman has the right to
acquire through the exercise of options within 60 days of May 1, 1996.
(3) Mr. Hillsberg will begin serving as a director of the Company upon the
consummation of the Offering. Mr. Katz will begin serving as a director of
the Company 30 days after the Effective Date.

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CERTAIN TRANSACTIONS

Between September 1995 and December 1995, Eugene I. Gordon, President and
Chairman of the Board made five unsecured loans to the Company in an aggregate
principal amount of $150,000, which bear interest at the rate of 7% per annum
and are due and payable on demand. A portion of the proceeds of this Offering
will be used for repayment of such indebtedness. See "Use of Proceeds." In
each of May and June 1996, Dr. Gordon made an unsecured loan to the Company in
the principal amount of $100,000 and $65,000, respectively, which bear interest
at the rates of 7% and 9%, respectively, per annum, and are due and payable on
demand.

In February 1996, Steven G. Cooperman, a Director of the Company, made an
unsecured loan to the Company in the principal amount of $50,000, which bears
interest at the rate of 8% per annum and is due and payable on the earlier of
(a) written demand made any time on or after January 31, 1997 or (b) the
consummation of this Offering. A portion of the proceeds of this Offering will
be used for repayment of such indebtedness. See "Use of Proceeds."

In February 1996, Sanford Hillsberg, who will become a Director of the
Company upon the consummation of the Offering, made an unsecured loan to the
Company in the principal amount of $50,000, which bears interest at the rate of
8% per annum and is due and payable on the earlier of (a) written demand made
any time on or after January 31, 1997 or (b) the consummation of this Offering.
A portion of the proceeds of this Offering will be used for repayment of such
indebtedness. See "Use of Proceeds."

Each such loan was made, and all future transactions of a similar nature
will be made, on terms no less favorable to the Company than other loans
available from unaffiliated parties.

Certain other bridge loans were made to the Company at higher interest
rates under different circumstances than those described above. See "Use of
Proceeds."

DESCRIPTION OF SECURITIES

The authorized capital of the Company consists of 7,000,000 shares of
Common Stock, par value $.001 per share and 1,000,000 shares of Preferred Stock,
par value $.01 per share (the "Preferred Stock"). As of the date of this
Prospectus, 2,450,312 shares of Common Stock are currently issued and
outstanding to approximately 25 holders, and no shares of preferred stock have
been issued or are outstanding (without giving effect to 49,688 shares of Common
Stock reserved for issuance pursuant to outstanding options under the Stock
Option Plan and 102,000 shares of Common Stock reserved for issuance pursuant to
outstanding warrants). There will be 3,521,741 shares of Common Stock and
1,071,429 Warrants issued and outstanding after the sale of the Units (without
giving effect to the Underwriter's over-allotment option, 49,688 shares of
Common Stock reserved for issuance pursuant to outstanding options under the
Stock Option Plan and 102,000 shares of Common Stock reserved for issuance
pursuant to outstanding warrants).

Immediately prior to the date of this Prospectus, the Company will effect a
1.987538926-for-1 split of its Common Stock. The information contained in this
Prospectus has been adjusted to give effect to such stock split.

PREFERRED STOCK

The Company's Board of Directors has the authority to issue shares of
Preferred Stock in one or more series and to fix the rights, preferences,
privileges and restrictions thereof, including dividend rights, dividend rates,
conversion rights, voting rights, terms of redemption (including sinking fund
provisions), redemption prices and liquidation preferences and the number of
shares constituting and the designation of any such series, without approval by
the stockholders. The Company's Board of Directors currently does not have any
plans to issue any shares of Preferred Stock. The Company has agreed with the
Underwriter not to issue shares of capital stock without the Underwriter's prior
written consent during the 24-month period following the Effective Date, other
than pursuant to the Stock Option Plan and the Warrants.

-43-

CERTAIN EFFECTS OF AUTHORIZED AND UNISSUED STOCK

There are currently 2,571,894 unissued and unreserved shares of Common
Stock and 1,000,000 unissued and unreserved shares of Preferred Stock. These
additional shares may be issued for a variety of proper corporate purposes,
including future public or private offerings to raise additional capital or
facilitate acquisitions. The Company has agreed with the Underwriter not to
issue shares of Common Stock without the Underwriter's prior written consent
during the 24-month period following the Date, other than in connection with the
Stock Option Plan and the Warrants.

One of the effects of the existence of unissued and unreserved shares of
Common Stock and Preferred Stock may be to enable the Company's Board of
Directors to discourage an attempt to change control of the Company (by means of
a tender offer, proxy contest or otherwise) and thereby to protect the
continuity of the Company's management. The issuance of shares of Preferred
Stock, whether or not related to any attempt to effect change in control, may
adversely affect the rights of the holders of shares of Common Stock.

UNITS

Each Unit consists of one share of Common Stock and one Class A Warrant.
The shares of Common Stock and the Warrants offered as Units become detachable
and separately transferable commencing on the date (the "Separation Date") which
is the earlier of three months after the Effective Date or such earlier date as
may be agreed upon by the Company and the Underwriter.

COMMON STOCK

The holders of Common Stock are entitled to one vote per share for the
election of directors and with respect to all other matters to be voted on by
stockholders. Shares of Common Stock do not have cumulative voting rights.
Therefore, the holders of more than 50% of such shares voting for the election
of directors can elect all of the directors if they choose to do so and, in that
event, the holders of the remaining shares will not be able to elect any
directors. The holders of Common Stock are entitled to receive dividends when,
as and if declared by the Board of Directors out of legally available funds.
See "Dividend Policy." In the event of liquidation, dissolution or winding up
of the Company, the holders of Common Stock are entitled to share ratably in all
assets remaining available for distribution to them after payment of liabilities
and after provision has been made for each class of stock, if any, having
preference over the Common Stock. Holders of shares of Common Stock, as such,
have no conversion, preemptive or other subscription rights, and there are no
redemption provisions applicable to the Common Stock.

WARRANTS

Each Class A Warrant entitles the holder to purchase, at a price of $10.00,
one share of Common Stock for a period of 24 months commencing on the date that
is three months following the Effective Date, which period may be extended by
mutual agreement between the Company and the Underwriter, unless redeemed by the
Company prior to such expiration date. The exercise price of the Warrants and
the number of shares of Common Stock or other securities or property to be
obtained upon exercise of the Warrants, are subject to adjustment under certain
circumstances, including, but not limited to, certain sales by the Company of
its shares of Common Stock for a price per share less than the then market price
of the Common Stock, or issuance by the Company of any shares of its Common
Stock as a dividend, or subdivision or combination of the Company's outstanding
shares of Common Stock into a greater or lesser number of shares. Reference is
hereby made to the complete text of the form of Warrant Agreement filed as an
exhibit to the Registration Statement of which this Prospectus forms a part.

The Class A Warrants are redeemable by the Company in whole but not in part
for $.01 per Warrant, upon 30 days' prior written notice, if the market price of
the Common Stock equals or exceeds $13.00 per share. In the event that the
Company gives notice of its intention to redeem the Warrants, holders would be
forced to exercise their Warrants or accept the redemption price. For purposes
of redemption, market price means (i) the average closing bid price for any 10
consecutive trading days within a period of 30 consecutive trading days, ending
within

-44-

five days of the date of the notice of redemption, of the Common Stock as
reported by Nasdaq or the OTC Bulletin Board or (ii) the average of the last
reported sale price for the 10 consecutive business days ending within five days
of the date of the notice of redemption, on the primary exchange on which the
Common Stock is traded, if the Common Stock is traded on a national securities
exchange.

The Warrants may be exercised by filling out and signing the appropriate
notice of exercise form attached to the Warrant and mailing or delivering it
(together with the Warrant) to Continental Stock Transfer & Trust Company of New
York, New York, the Warrant Agent, in time to reach the Warrant Agent prior to
the time fixed for termination or redemption of the Warrants, accompanied by
payment of the full warrant exercise price.

The holders of the Warrants are not entitled to vote, receive dividends, or
exercise any of the rights of the holders of shares of Common Stock for any
purpose until the Warrants have been duly exercised and payment of the Warrant
exercise price has been made. Although the Company has applied for the Warrants
to be included for quotation on the OTC Bulletin Board, of which there can be no
assurance, at the present time there is no market for the Warrants and there can
be no assurance that a trading market for the Warrants will ever develop. The
Company's previous application for inclusion of the Warrants on Nasdaq was
denied by the Nasdaq staff because of its concerns regarding the Company's early
stage of development. See "Risk Factors -- No Assurance of Public Trading
Market; Denial of Nasdaq Listing."

For the life of the Warrants, the holders are given the opportunity to
profit from the rise, if any, in the market price of the Common Stock at the
expense of the remaining holders of the Common Stock. However, during the
outstanding period of the Warrants, the Company might be deprived of favorable
opportunities to secure additional equity capital for its business, since
holders of Warrants may be expected to exercise their Warrants at a time when
the Company would be able to obtain equity capital by a public sale of new
securities on terms more favorable than those provided in the Warrants.

CERTAIN GENERAL CORPORATION LAW PROVISIONS

A Delaware statute prevents an "interested stockholder" (defined generally
as a person owning 15% or more of a corporation's voting stock) from engaging in
a "business combination" with the Delaware corporation for three years following
the date on which the person became an interested stockholder unless, with
certain exceptions, the transaction is approved by the Company's Board of
Directors and the vote of two-thirds of the outstanding shares not owned by such
interested stockholder. This statute could have the effect of discouraging,
delaying or preventing hostile takeovers, including those that might result in
the payment of a premium over market price for the Common Stock, or changes in
control or management of the Company.

CERTAIN MARKET INFORMATION

The Company has applied for the inclusion of its Units, Common Stock and
Warrants on the OTC Bulletin Board under the symbol "MJETU," "MJETC" and
"MJETW," respectively.

While the Company has met the quantitative criteria for inclusion on
Nasdaq, the Company's application for listing on Nasdaq was denied by the Nasdaq
staff because its concerns regarding the Company's early stage of development.
The Company does not agree with the determination of the staff and is appealing
the decision.

TRANSFER AND WARRANT AGENT

The transfer agent for the Common Stock and the warrant agent for the
Warrants is Continental Stock Transfer & Trust Company, whose address is 2
Broadway, New York, New York 10004.

-45-

SHARES ELIGIBLE FOR FUTURE SALE

Upon the consummation of the Offering, the Company will have outstanding
3,521,741 shares of Common Stock (without giving effect to 49,688 shares of
Common Stock reserved for issuance pursuant to outstanding options under the
Stock Option Plan and 102,000 shares of Common Stock reserved for issuance
pursuant to outstanding warrants). In addition, the Company will have reserved
(i) 1,071,429 shares of Common Stock for issuance upon the exercise of the
Warrants included in the Units, (ii) 160,714 shares of Common Stock for issuance
upon the exercise of the Underwriter's over-allotment option, (iii) 160,714
shares of Common Stock for issuance upon the exercise of Warrants included in
the Units in the Underwriter's over-allotment option, (iv) 214,286 shares of
Common Stock for issuance upon the exercise of the maximum number of Options
granted to the Underwriter and the Warrants included therein, (v) 249,688 shares
of Common Stock for issuance pursuant to the Stock Option Plan and (vi) 102,000
shares of Common Stock for issuance pursuant to outstanding warrants. Of such
outstanding shares, the shares underlying the Units sold in connection with the
Offering will become freely tradeable in the United States without restriction
under the Securities Act after the Separation Date, except that shares
underlying the Units purchased by an "affiliate" of the Company, within the
meaning of the rules and regulations adopted under the Securities Act, may be
subject to resale restrictions. The remaining outstanding shares and any shares
issued pursuant to the Stock Option Plan of the Company are "restricted
securities," as that term is defined under such rules and regulations, and may
not be sold unless they are registered under the Securities Act or sold in
accordance with Rule 144 under the Securities Act or another applicable
exemption from such registration requirement.

In general, under Rule 144, beginning 90 days after the date of this
Prospectus, subject to certain conditions with respect to the manner of sale,
the availability of current public information concerning the Company and
other matters, each of the existing stockholders who has beneficially owned
shares of Common Stock for at least two years will be entitled to sell within
any three-month period that number of such shares which does not exceed the
greater of 1% of the total number of then outstanding shares of Common Stock
or the average weekly trading volume of shares of Common Stock during the
four calendar weeks preceding the date on which notice of the proposed sale
is sent to the Commission. Moreover, each of the existing stockholders who
is not deemed to be an affiliate of the Company at the time of the proposed
sale, who is not deemed to be such an affiliate during the three months
preceding the time of the proposed sale and who has beneficially owned his
shares of Common Stock for at least three years will be entitled to sell such
shares under Rule 144 without regard to such volume limitations. All of the
shares of Common Stock held by the existing stockholders will be eligible for
sale under Rule 144 after December 31, 1997. Approximately 71.7% of such
shares are presently held by affiliates of the Company and, therefore, would
not presently be eligible for sale under Rule 144 without regard to such
volume limitations.

The Company and its executive officers, directors and stockholders have
agreed that, for a period of 24 months after the Effective Date, they will
not dispose of any securities held by them under Rule 144 or otherwise
without the prior written consent of the Company and the Underwriter.

Prior to the Offering, there has been no public market for the Units or
underlying Common Stock and Warrants, and no assurance can be given that such
a market will develop or, if it develops, that it will be sustained after the
Offering or that the purchasers of the Units will be able to resell such
Units at a price higher than the initial public offering price or otherwise.

UNDERWRITING

Patterson Travis, Inc. (the "Underwriter") has entered into an underwriting
agreement with the Company pursuant to which, and subject to the terms and
conditions thereof, it has agreed to purchase all of the Units offered hereby.

The Company has granted an option to the Underwriter, exercisable during
the 30-day period from the date of this Prospectus, to purchase up to a maximum
of 160,714 additional Units at the offering price, less the underwriting
discount, to cover over-allotments, if any.

The Company has agreed to pay to the Underwriter a non-accountable expense
allowance equal to 3% of the gross proceeds of this Offering upon the closing of
this Offering.

The Underwriter proposes to offer the Units to the public at the offering
price set forth on the cover page. The Company has agreed to pay the
Underwriter a commission for the Units sold equalling 10.0% of the public
offering price thereof. In addition, the Company has agreed to pay the
Underwriter a commission of 8.0% of the

-46-

exercise price of all Warrants exercised beginning one year after the date
hereof as the result of solicitation made by the Underwriter. A commission
for Warrant exercise will not be paid if (i) the market price of the Common
Stock is lower than the exercise price; (ii) the Warrants are held in a
discretionary account; (iii) disclosure of the compensation arrangements have
not been made in documents provided to the holder of Warrants both as part of
this Offering and at the time of exercise; or (iv) the exercise of Warrants
is unsolicited. An exercise of Warrants will be presumed to be unsolicited
pursuant to (iv) above unless the holder has indicated in writing that the
transaction was solicited and has designated the broker/dealer that is to
receive compensation for the exercise.

The Underwriter may allow to selected dealers who are members of the
National Association of Securities Dealers, Inc., and such dealers may reallow,
a concession not in excess of $.56 per Unit to certain other dealers, including
the Underwriter. The Underwriter has informed the Company that it will not
confirm sales to any accounts over which it exercises discretionary authority.

The initial offering price of the Units and the exercise and redemption
price of the Warrants were arbitrarily determined by negotiations between the
Company and the Underwriter. The factors which were considered in determining
such prices were the history of and the prospects for the field in which the
Company competes, the ability and expertise of the Company's management, the
prospects for future earnings of the Company, the present state of the Company's
development, the general condition of the securities markets at the time of the
Offering and the recent market prices of and the demand for publicly traded
common stock of generally comparable companies.

Upon the sale of the Units, the Company has also agreed to sell to the
Underwriter, for a nominal consideration, options (the "Underwriter's Options")
for the purchase of 107,143 Units. Each of the Underwriter's Options is
exercisable to purchase one Unit at $6.72 at any time during a period of four
years commencing one year from the date of this Prospectus. The Units will each
consist of one share of Common Stock and one Class A 24-month Warrant to
purchase one share of Common Stock at an exercise price of $10.00. The
Underwriter's Options require, under certain circumstances, the Company to
register the Common Stock underlying such Options for sale to the public. The
Underwriter's Options are nontransferable for a period of one year except to
officers of the Underwriter or the selling group. The exercise price of the
Underwriter's Options and the number of Units covered thereby are subject to
adjustment to protect the holders against dilution in certain events. The Class
A Warrants contained in the Units are redeemable by the Company for $.01 per
Warrant if the market price for the Common Stock equals or exceeds $10.00 within
a period of any 10 consecutive trading days within a period of 30 trading days
ending within five days prior to the date of the notice of redemption.

The Company has agreed with the Underwriter not to issue shares of Common
Stock without the Underwriter's prior written consent during the 24-month period
following the Effective Date, other than pursuant to options which have been or
will be granted under the Stock Option Plan and pursuant to the Warrants. The
Company has further agreed that during the 12-month period commencing 12 months
after the Effective Date, it will not issue options for shares of Common Stock
at an exercise price less than the then "Market Price" thereof. "Market Price"
is defined as (i) the average closing bid price, for any 10 consecutive trading
days within a period of 30 consecutive trading days ending within five days
prior to the date of issuance of the Common Stock, as reported by Nasdaq or the
OTC Bulletin Board or (ii) the average of the last reported sale price, for the
10 consecutive business days ending within five days of the date of issuance of
the Common Stock, on the primary exchange on which the Common Stock is traded,
if the Common Stock is traded on a national securities exchange. The Company
also has agreed with the Underwriter not to issue shares of preferred stock
without the Underwriter's prior written consent during the 24-month period
following the Effective Date.

The Company and its executive officers, directors and stockholders have
agreed that, for a period of 24 months after the Effective Date, they will not
dispose of any securities held by them under Rule 144 or otherwise without the
prior written consent of the Company and the Underwriter.

Pursuant to a letter agreement dated January 25, 1996, the Underwriter has
arranged bridge financing for the Company from Mrs. Jan Wernick in the amount of
$50,000 per month, not to exceed an aggregate of $200,000, with interest payable
at the rate of 12%. Mrs. Wernick's husband is affiliated with the Underwriter
as the manager of its New York office. All amounts outstanding under such
bridge financing, which was $200,000 at May 6, 1996,

-47-

become due and payable upon the Effective Date. A portion of the
proceeds of this Offering will be used for repayment of such indebtedness.
See "Use of Proceeds."

The Underwriting Agreement provides that the Underwriter shall have the
right to designate one member to the Board of Directors of the Company for a
period of three years after the closing of this Offering. Dr. Steven Katz has
been designated by the Underwriter to serve as a Director.

The Company and the Underwriter have agreed in the Underwriting Agreement
to indemnify each other against certain liabilities, including liabilities under
the Securities Act. Insofar as indemnification for liabilities arising under
the Securities Act may be provided to officers, directors or controlling persons
of the Company, such indemnification, in the opinion of the Commission, is
against public policy and therefore unenforceable.

LEGAL MATTERS

The legality of the Securities offered and certain legal matters relating
to this Offering (other than matters relating to patent law and regulatory
matters relating to the FDA) will be passed upon for the Company by Kelley Drye
& Warren LLP, New York, New York. Matters relating to United States patent law
will be passed upon for the Company by Graham & James LLP, New York, New York.
Regulatory matters relating to the FDA will be passed upon for the Company by
Dean E. Snyder, Esquire, Northfield, Illinois. Bernstein & Wasserman, LLP, New
York, New York, has acted as counsel for the Underwriter in connection with this
Offering.

EXPERTS

The financial statements of the Company included in this Prospectus at
December 31, 1993, 1994 and 1995 and for the years ended December 31, 1993, 1994
and 1995 and the period from December 16, 1993 (inception) through December 31,
1995, have been audited by Rosenberg Rich Baker Berman & Company, P.A.,
independent certified public accountants, as set forth in their reports thereon
appearing elsewhere herein and are included in reliance upon such reports given
upon the authority of such firm as experts in accounting and auditing.

-48-

GLOSSARY

As used in this Prospectus, the following terms have the following
meanings:

ALK. See KERATOMILEUSIS IN SITU.

ACCOMMODATION is the ability of the internal lens of the eye to adjust its
shape, and hence its refractive power, in order to achieve best focus.
Accommodation diminishes and ultimately disappears in mature adults.

ASTIGMATISM is a result of a nonuniformity in the curvature of the cornea.
This causes a blurring of vision in the uncorrected eye because of its inability
to achieve a single point focus.

BOWMAN'S LAYER is the layer of the cornea between the epithelium and the
stroma.

CORNEA is the curved, transparent, outermost surface of the eye and serves
as a "window" through which light can pass. It is the primary focusing element
of the optical system of the eye.

EPITHELIUM is the outer regenerative layer of the cornea.

EMMETROPIA is a condition in which the eyes focus optimally and no vision
correction is required. In emmetropia, the focusing system of the eye is not
myopic, hyperopic or astigmatic.

FDA means the United States Food and Drug Administration.

FD&C ACT means the Federal Food, Drug, and Cosmetic Act and implementing
regulations.

HYDRO-REFRACTIVE KERATOPLASTY ("HRK") is a refractive surgical procedure
which utilizes an ultra-fine beam of water traveling at supersonic speeds as
a scalpel. The waterjet scalpel, in conjunction with a template, is used to
reshape the anterior surface of the cornea, thereby correcting refractive
disorders or errors.

HYDRO-THERAPEUTIC KERATOPLASTY ("HTK") is a therapeutic procedure which
utilizes an ultra-fine beam of water traveling at supersonic speeds as a
scalpel. The waterjet scalpel, in conjunction with a template, is used to
remove diseased tissue from the cornea.

HYPEROPIA is farsightedness, which occurs when the cornea is too flat for
the depth of the eye.

INTERNAL LENS is an element of the optical system of the eye which
changes or accommodates its refractive power to achieve best focus.

INTRAOCULAR PRESSURE ("IOP") is the internal gauge pressure of the liquid
within the eye globe.

KERATECTOMY is a surgical procedure in which a portion of the cornea is
removed in order to modify its refractive power.

KERATO- is a prefix meaning cornea.

KERATOME is a surgical device employed in keratoplasty to shave thin layers
from the anterior surface of the cornea. One of the components of a keratome is
a cutting instrument, consisting of a diamond, metal, laser or waterjet scalpel,
which actually makes the incision across the cornea.

KERATOMILEUSIS is a refractive surgical procedure in which the cornea is
carved or shaved in order to modify its curvature.

-49-

KERATOMILEUSIS IN SITU ("KIS"), also known as refractive lamellar
keratoplasty ("RLK") or automated lameller keratoplasty ("ALK"), is a
refractive surgical procedure in which a keratome with a metal or diamond
scalpel is used to shave away a portion of the intact stromal bed after a
flap has been formed by the keratome to gain access to the stroma.

KERATOPLASTY is any surgical modification of the cornea.

KERATOTOMY is a surgical incision into the cornea, which is approximately
perpendicular to the surface of the eye.

LASIK is a combination of KIS to make a flap and PRK to shape the stomal
bed. LASIK stands for "Light Ablation System for In-Situ Keratomileusis."

MYOPIA is nearsightedness, a focusing deficiency which occurs when the
cornea is too spherical for the depth of the eye.

PHOTOABLATION is a process which uses high intensity pulsed light to
remove a thin surface layer of the cornea.

PHOTOREFRACTIVE KERATECTOMY ("PRK") is a refractive surgical procedure
using a particular type of pulsed laser, known as an excimer laser, to remove
by photoablation many very thin layers of tissue of locally variable
thickness from the cornea in order to modify its curvature.

PRE-MARKET APPROVAL APPLICATION ("PMA") is an application to seek
approval from the FDA to market a product under Section 515 of the FD&C Act.

PRE-MARKET NOTIFICATION APPLICATION refers to an application to the FDA
under Section 510(k) of the FD&C Act for a ruling that a new device is
substantially equivalent to an already marketed device and permitting the new
device to be marketed (without obtaining a PMA).

RLK. See KERATOMILEUSIS IN SITU.

RADIAL KERATOTOMY ("RK") is a refractive surgical procedure utilizing a
diamond or metal scalpel in which radial incisions are made in the periphery of
the cornea, outside of the vision zone, producing a flattening of the cornea due
to a redistribution of stresses in the cornea. The incisions are approximately
perpendicular to the surface of the eye.

REFRACTION refers to the passage of light rays from one optical medium, such
as air, into a second optical medium, such as the cornea, which passage is
accompanied by the bending of light rays at the interface. The amount of
bending depends on the direction of the light rays relative to the surface
normal direction.

REFRACTIVE ERROR is the amount of deviation from emmetropia in the focusing
system of the eye. It is measured in diopters.

REFRACTIVE SURGERY is surgery of which the purpose is to alter the
refraction of light passing into the cornea in order to change the focusing
strength of the cornea. This is accomplished by modifying the anterior
curvature of the corneal surface.

SCLERA is the opaque white of the eye surrounding the cornea. It
constitutes the main structure of the eye.

STROMA is the main layer of the cornea, constituting about 80% of its
thickness, which is responsible for most of its mechanical and optical
properties. It is a complex structure, composed of about 70% water.

-50-

VISION ZONE is a circular region within the cornea through which all of the
light ultimately reaching the retina passes.

-51-

INDEX TO FINANCIAL STATEMENTS
Page

Independent Auditors' Report................................................ F-2

Balance Sheets as of March 31, 1996 (Unaudited) and
December 31, 1995..........................................................F-3

Statements of Operations for the three months ended
March 31, 1996 and 1995 (Unaudited) and for the
years ended December 31, 1995 and 1994 and the
period from December 16, 1993 (inception) to
March 31, 1996 (Unaudited).................................................F-5

Statement of Stockholders' Equity as of March 31, 1996
(Unaudited) and December 31, 1995 and 1994.................................F-7

Statements of Cash Flows for the three months ended
March 31, 1996 and 1995 (Unaudited) and for the
years ended December 31, 1995 and 1994 and the
period from December 16, 1993 (inception) to
March 31, 1996 (Unaudited).................................................F-8

Notes to the Financial Statements...........................................F-12

F-1

INDEPENDENT AUDITORS' REPORT

To the Board of Directors and
Stockholders of Medjet Inc.
(A Development Stage Company)
1090 King Georges Post Road
Suite 301
Edison, New Jersey 08837

We have audited the accompanying balance sheet of Medjet Inc. (A
Development Stage Company) as of December 31, 1995 and the related statements of
operations, stockholders' equity and cash flows for the years then ended
December 31, 1995 and 1994. These financial statements are the responsibility of
the Company's management. Our responsibility is to express an opinion on these
financial statements based on our audit.

We conducted our audit in accordance with generally accepted auditing
standards. 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 Medjet Inc. (A
Development Stage Company) as of December 31, 1995 and the results of its
operations and its cash flows for the years then ended December 31, 1995 and
1994 in conformity with generally accepted accounting principles.

The accompanying financial statements have been prepared assuming
that the Company will continue as a going concern. The Company continues to
be in the development stage as of December 31, 1995 and has incurred a net
loss of $677,385 for the year ended December 31, 1995 and has incurred losses
since inception of $964,676. These factors, among others as discussed in
Note A to the financial statements, raise substantial doubt about the
Company's ability to continue as a going concern. Management's plans in
regard to these matters are also described in Note A. The 1995 financial
statements do not include any adjustments that might result from the outcome
of this uncertainty.

ROSENBERG RICH BAKER BERMAN AND COMPANY

Maplewood, New Jersey

January 15, 1996, except as to Note A(2), Note B(5) and (6), Note E, Note F,
Note H, Note I and Note J which are dated July 19, 1996.

F-2

MEDJET INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS

ASSETS

March Pro-Forma March December
31, 1996 Adjustments 31, 1996 31, 1995
-------- ----------- -------- --------
(Unaudited) (Unaudited)
(Pre-Pro- (Post-Pro-
Forma Forma
Adjustments) Adjustments)

CURRENT ASSETS:
Cash and cash equivalents $ 60,660 - $ 60,660 $ 57,678
Marketable securities, at cost - - - -
Interest receivable - - - -
Prepaid expenses 6,196 - 6,196 2,543
Prepaid income taxes - - - -
-------- -------- -------- --------
66,856 66,856 60,221

PROPERTY, PLANT & EQUIPMENT:
Leasehold improvements 1,620 - 1,620 -
Ophthalmic equipment 29,688 - 29,688 29,688
Office furniture 10,011 - 10,011 8,781
Lab furniture 2,851 - 2,851 2,851
Computer equipment 26,892 - 26,892 20,487
Optical equipment 20,144 - 20,144 19,207
Waterjet equipment 35,794 - 35,794 32,497
Software 5,025 - 5,025 3,640
Mechanical equipment 2,313 - 2,313 2,313
Electronic equipment 2,874 - 2,874 1,169
-------- -------- -------- --------
137,212 - 137,212 120,633
Less - Accumulated depreciation 54,981 - 54,981 47,127
-------- -------- -------- --------
82,231 - 82,231 73,506
-------- -------- -------- --------

DEFERRED OFFERING COSTS 156,980 - 156,980 36,263
-------- -------- -------- --------

ORGANIZATION COSTS - Less
accumulated amortization of $14,531
in 1996, $12,661 in 1995 and $5,183
in 1994 22,856 - 22,856 24,726
PATENT - Less accumulated
amortization of $1,058 in 1996,
$772 in 1995 and $208 in 1994 18,347 - 18,347 18,633
SECURITY DEPOSITS 5,437 - 5,437 3,702
-------- -------- -------- --------

$352,707 - $352,707 $217,051
-------- -------- -------- --------
-------- -------- -------- --------

See Notes to the Financial Statements.

F-3

MEDJET INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS

LIABILITIES AND STOCKHOLDERS' EQUITY

MARCH PRO-FORMA MARCH DECEMBER
31, 1996 Adjustments 31, 1996 31, 1995
-------- ----------- -------- --------
(Unaudited) (Unaudited)
(Pre-Pro- (Post-Pro-
Forma Forma
Adjustments) Adjustments)

CURRENT LIABILITIES:

Accounts payable $ 171,783 - $ 171,783 $ 64,753
Accrued interest payable 5,368 - 5,368 -
Notes payable 200,000 - 200,000 -
Notes payable - officer 150,000 - 150,000 150,000
Income taxes payable 150 - 150 150
Accrued officer's salary - - - -
--------- --------- --------- ---------

527,301 - 527,301 214,903

STOCKHOLDERS' EQUITY (DEFICIT):

Common stock, $.001 par value,
7,000,000 shares authorized, 2,450,312
(post-split) issued and outstanding 2,450 - 2,450 2,450

Preferred Stock, $.01 par value,
1,000,000 shares authorized, no
shares issued - - - -

Additional paid in capital 964,374 (1,141,418)(1) (177,044) 964,374

Accumulated deficit during
development stage (1,141,418) 1,141,418 (1) - (964,676)
--------- --------- --------- ---------
(174,594) - (174,594) 2,148
--------- --------- --------- ---------

$ 352,707 - $352,707 $217,051
--------- --------- --------- ---------
--------- --------- --------- ---------

PRO-FORMA ADJUSTMENT

(1) Upon completion of the Initial Public Offering (see "Subsequent
Event" note) the Company's status changes from an "S" corporation
to a "C" corporation. Accordingly, the deficits accumulated during
the development stage are charged against additional paid in
capital.

F-4

See Notes to the Financial Statements.

F-5

MEDJET INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 1996 AND 1995 (UNAUDITED)
AND YEARS ENDED DECEMBER 31, 1995 AND 1994, AND THE PERIOD FROM
DECEMBER 16, 1993 (DATE OF INCEPTION) TO MARCH 31, 1996 (UNAUDITED)

FOR THE THREE FOR THE THREE DECEMBER 16, 1993
MONTHS ENDED MONTHS ENDED (INCEPTION) TO
MARCH 31, 1996 MARCH 31, 1995 MARCH 31, 1996
-------------- -------------- --------------
(Unaudited) (Unaudited) (Unaudited)

NET SALES $ - $ - $ -
EXPENSES: --------- --------- -----------
Officer's salary 28,867 24,100 191,967
Consultant fees 7,000 26,850 93,100
Other salaries 80,429 44,638 427,125
Professional fees 2,280 - 50,695
Rent 6,105 6,663 47,884
Mechanical supplies 7,417 18,711 65,793
Depreciation 7,854 6,791 54,981
Ophthalmology research 2,700 804 22,349
Insurance 1,147 - 14,400
Amortization 2,156 1,998 15,589
Travel 1,625 2,366 21,956
Payroll taxes 11,704 8,998 50,079
Optical supplies 392 633 5,938
Telephone 1,462 1,213 11,146
Miscellaneous expenses,
fees and taxes 3,184 2,184 17,576
Advertising - 402 3,104
Biological supplies 800 1,202 10,530
Freight 1,352 1,603 8,765
Office supplies 1,363 477 7,189
Employee welfare 1,038 1,199 12,741
Electrical supplies 794 896 3,837
Chemical supplies 396 956 5,055
Payroll processing fees 182 178 1,710
Bank charges 61 - 649
Postage 160 93 1,195
Blueprinting and photostats 502 125 4,874
Security system 204 - 546
Membership fees - 45 90
--------- --------- -----------
171,174 153,125 1,150,863
--------- --------- -----------
OTHER INCOME (EXPENSE):
Interest income - 6,074 15,263
Interest expense (5,368) - (5,368)
LOSS BEFORE INCOME
TAXES (176,542) (147,051) (1,140,968)
STATE INCOME TAXES 200 - 450
--------- --------- -----------
NET LOSS $(176,742) $(147,051) $(1,141,418)
--------- --------- -----------
--------- --------- -----------
NET LOSS PER SHARE $ (.07) $ (.06) $ (.51)
--------- --------- -----------
--------- --------- -----------
WEIGHTED AVERAGE
COMMON SHARES
OUTSTANDING 2,450,312 2,410,893 2,258,848
--------- --------- -----------
--------- --------- -----------

See Notes to the Financial Statements.

F-6

FOR THE YEAR FOR THE YEAR
ENDED ENDED
DECEMBER 31, 1995 DECEMBER 31, 1994
----------------- -----------------

NET SALES $ - $ -
EXPENSES: --------- ---------
Officer's salary 96,400 66,700
Consultant fees 29,850 56,250
Other salaries 302,774 43,922
Professional fees 26,689 21,726
Rent 24,066 17,713
Mechanical supplies 40,994 17,382
Depreciation 32,321 14,806
Ophthalmology research 7,874 11,775
Insurance 7,672 5,581
Amortization 8,042 5,391
Travel 15,566 4,765
Payroll taxes 34,015 4,360
Optical supplies 1,985 3,561
Telephone 6,186 3,498
Miscellaneous expenses,
fees and taxes 11,125 3,267
Advertising 762 2,342
Biological supplies 7,609 2,121
Freight 5,636 1,777
Office supplies 4,063 1,763
Employee welfare 10,303 1,400
Electrical supplies 1,715 1,328
Chemical supplies 3,643 1,016
Payroll processing fee 812 716
Bank charges 20 568
Postage 598 437
Blueprinting and photostats 4,182 190
Security system 166 176
Membership fees 45 45
--------- ---------
685,113 294,576
--------- ---------
OTHER INCOME (EXPENSES):
Interest income 7,928 7,335
Interest expense - -
LOSS BEFORE INCOME
TAXES (677,185) (287,241)
STATE INCOME TAXES 200 50
--------- ---------
NET LOSS $(677,385) $(287,291)

--------- ---------
--------- ---------
NET LOSS PER SHARE $ (.28) $ (.14)
--------- ---------
--------- ---------
WEIGHTED AVERAGE
COMMON SHARES
OUTSTANDING 2,422,953 2,111,597
--------- ---------
--------- ---------

F-7

MEDJET INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF STOCKHOLDERS' EQUITY
PERIOD FROM DECEMBER 16, 1993 (DATE OF INCEPTION)
TO MARCH 31, 1996 (UNAUDITED)

COMMON PRICE TOTAL COMMON STOCK PAID
SHARES PER CONSIDERATION ($.001 PAR IN ACCUMULATED
DATE DESCRIPTION ISSUED SHARE PAID VALUE CAPITAL DEFICIT
---- ----------- ------ ----- ---- ----- ------- -------

March 12, 1994 Share Issuance 800,000 $ .10 $ 80,000 $ 800 $ 79,200 $ -
April 21, 1994 Share Issuance 15,000 .10 1,500 15 1,485 -
May 1, 1994 Share Issuance 63,000 .10 6,300 63 6,237 -
May 25, 1994 Share Issuance 50,000 1.00 50,000 50 49,950 -
May 31, 1994 Share Issuance 25,000 1.00 25,000 25 24,975 -
June 6, 1994 Share Issuance 50,000 1.00 50,000 50 49,950 -
June 7, 1994 Share Issuance 50,000 1.00 50,000 50 49,950 -
June 13, 1994 Share Issuance 25,000 1.00 25,000 25 24,975 -
June 20, 1994 Share Issuance 25,000 1.00 25,000 25 24,975 -
July 28, 1994 Share Issuance 25,000 1.00 25,000 25 24,975 -
September 23, 1994 Share Issuance 45,002 6.00 270,012 45 269,967
October 20, 1994 Share Issuance 20,501 6.00 123,008 21 122,987 -
October 28, 1994 Share Issuance 2,500 6.00 15,000 2 14,998 -
November 10, 1994 Share Issuance 14,500 6.00 87,000 15 86,985 -
November 16, 1994 Share Issuance 2,501 6.00 15,004 2 15,002 -

Net Loss, Year Ended December 31, 1994 - - - - - (287,291)
------ ------- ------- ------- ---------

Balance, December 31, 1994 1,213,004 847,824 1,213 846,611 (287,291)

August 8, 1995 Share Issuance 5,000 6.00 30,000 5 29,995 -
August 28, 1995 Share Issuance 4,000 6.00 24,000 4 23,996 -
September 21, 1995 Share Issuance 5,000 6.00 30,000 5 29,995 -
September 29, 1995 Share Issuance 5,000 6.00 30,000 5 29,995 -
December 31, 1995 Share Issuance 833 6.00 5,000 1 4,999 -
December 31, 1995 Stock Split
1.987538926 for
1 Share Outstanding 1,217,475 - - 1,217 (1,217) -

Net Loss, Year Ended December 31, 1995 - - - - - (677,385)
------ ------- ------- ------- ---------

Balance, December 31, 1995 2,450,312 $ 966,824 $ 2,450 $965,591 $ (964,676)

Net Loss, Three Months Ended
March 31, 1996 - - - - - (176,742)
------ ------- ------- ------- ---------

Balance, March 31, 1996 (Unaudited) 2,450,312 $ 966,824 $ 2,450 $965,591 $(1,141,418)

See Notes to the Financial Statements.

F-8

MEDJET INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 1996 AND 1995 (UNAUDITED)
AND YEARS ENDED DECEMBER 31, 1995 AND 1994, AND THE PERIOD FROM
DECEMBER 16, 1993 (DATE OF INCEPTION), TO MARCH 31, 1996 (UNAUDITED)

CASH FLOWS FROM
OPERATING ACTIVITIES:

Net loss $(176,742) $(147,051) $(1,141,418)
Adjustments to Reconcile
Net Loss to Net Cash Used
by Operating Activities:
Depreciation and
amortization 10,010 8,789 70,570
(Increase) Decrease in
interest receivable - (4,663) -
(Increase) Decrease in
prepaid income taxes - - -
(Increase) in prepaid
expenses (3,653) (3,779) (6,196)
(Decrease) Increase in
accounts payable (13,687) 407 14,803
Increase in accrued
interest payable 5,368 - 5,368
Increase in income taxes
payable - - 150
Increase (Decrease) in
accrued officer's salary - (18,000) -
--------- --------- -----------

Net Cash Used by
Operating Activities (178,704) (164,297) (1,056,723)
--------- --------- -----------

CASH FLOWS FROM
INVESTING ACTIVITIES:
Cash (purchases) redemption
of marketable securities - 320,605 -
Cash purchases of property
and equipment (16,579) (16,937) (137,212)
Cash purchase of
organization costs - - (37,387)
Cash purchase of patents - - (19,405)
Cash payments for security
deposits (1,735) - (4,437)
--------- --------- -----------

Net Cash Provided (Used) by
Investing Activities (18,314) 303,668 (199,441)
--------- --------- -----------

See Notes to the Financial Statements.

F-9

FOR THE YEAR FOR THE YEAR
ENDED ENDED
DECEMBER 31, 1995 DECEMBER 31, 1994
----------------- -----------------

CASH FLOWS FROM
OPERATING ACTIVITIES:

Net loss $(677,385) $(287,291)
Adjustments to reconcile
Net Loss to Net Cash Used
by Operating Activities:
Depreciation and
amortization 40,363 20,197
(Increase) Decrease in
interest receivable 2,877 (2,877)
(Increase) Decrease in
prepaid income taxes 25 (25)
(Increase) in prepaid
expenses (2,543) -
(Decrease) Increase in
accounts payable (3,016) 31,506
Increase in accrued
interest payable - -
Increase in income taxes
payable 150 -
Increase (Decrease) in
accrued officer's salary (66,700) 66,700
-------- --------

Net Cash Used by
Operating Activities (706,229) (171,790)
-------- --------

CASH FLOW FROM
INVESTING ACTIVITIES:
Cash (purchases) redemption
of marketable securities 320,605 (320,605)
Cash purchase of property
and equipment (43,918) (76,715)
Cash purchase of
organization costs - (37,387)
Cash purchase of patents (10,716) (8,689)
Cash payments for security
deposits - (3,702)
-------- --------

Net Cash Provided (Used) by
Investing Activities 265,971 (447,098)
-------- --------

See Notes to the Financial Statements.

F-10

CASH FLOWS FROM FINANCING ACTIVITIES (CONTINUED):

Proceeds from issuance
of common stock $ - $ - $ 966,824
Proceeds from officer loan - - 156,000
Repayment of officer loan - - (6,000)
Proceeds from notes payable 200,000 - 200,000
---------- ---------- ----------

Net Cash Provided by
Financing Activities 200,000 - 1,316,824
---------- ---------- ----------

NET INCREASE
(DECREASE) IN CASH 2,982 139,371 60,660

CASH AND CASH
EQUIVALENTS - BEGINNING
OF PERIOD 57,678 228,936 -
---------- ---------- ----------

CASH AND CASH
EQUIVALENTS - END
OF PERIOD $ 60,660 $ 368,307 $ 60,660
---------- ---------- ----------
---------- ---------- ----------

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:

Cash Paid During the Year For:
Income taxes $ - $ - $ 200
---------- ---------- ----------
---------- ---------- ----------

SUPPLEMENTAL DISCLOSURES OF NON-CASH FINANCING ACTIVITIES:

Increase in Accounts
Payable for Accrual
of Deferred Charges $ 120,717 $ - $ 156,980
---------- ---------- ----------
---------- ---------- ----------

See Notes to the Financial Statements.

F-11

FOR THE YEAR FOR THE YEAR
ENDED ENDED
DECEMBER 31, 1995 DECEMBER 31, 1994
----------------- -----------------

CASH FLOWS FROM FINANCING ACTIVITIES (CONTINUED):

Proceeds from issuance
of common stock $ 119,000 $ 847,824
Proceeds from officer loan 150,000 6,000
Repayment of officer loan - (6,000)
Proceeds from notes payable - -
--------- ---------

Net Cash Provided by
Financing Activities 269,000 847,824
--------- ---------

NET INCREASE
(DECREASE) IN CASH (171,258) 228,936

CASH AND CASH EQUIVALENTS - BEGINNING

OF PERIOD 228,936 -
--------- ---------

CASH AND CASH
EQUIVALENTS - END
OF PERIOD $ 57,678 $ 228,936
--------- ---------
--------- ---------

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:

Cash Paid During the Year For:
Income taxes $ 125 $ 75
--------- ---------
--------- ---------

SUPPLEMENTAL DISCLOSURES OF NON-CASH FINANCING ACTIVITIES:

Increase in Accounts
Payable for Accrual
of Deferred Charges $ 36,263 $ -
--------- ---------
--------- ---------

F-12

MEDJET INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS

NOTE A - NATURE OF ORGANIZATION AND BASIS OF PRESENTATION:

(1) NATURE OF ORGANIZATION:

Medjet Inc. (the Company) is a development stage company
incorporated in the State of Delaware on December 16, 1993. The
Company was organized to engage in the design, development,
production and sales of refractive corneal correction technology and
equipment.

(2) BASIS OF PRESENTATION:

The Company is a development stage enterprise and has neither
realized any operating revenue nor has any assurance of realizing
any future operating revenue. Successful future operations depend
upon the successful development and marketing of the refractive
corneal correction technology and equipment. During the period
required to successfully develop and market a commercial product,
the Company will require additional funds for operations.
Substantial additional financing may be required to continue and
complete the development of refractive corneal correction technology
and equipment, obtain regulatory approval and market the product.
These conditions raise substantial doubt about the Company's ability
to continue as a going concern. Management's plans in regard to
these matters include (1) an initial public offering of 1,071,429
units ("Units"), with each Unit consisting of (i) one share of
Medjet common stock and (ii) one 24-month warrant to purchase one
common share at an exercise price of $10 per share, (2) securing
interim short-term financing until such time as the planned initial
public offering is completed, (3) reducing the level of research and
administrative expenses, including the deferment of officers'
salaries until such time as additional equity financing is
completed, and (4) considering additional private placements of
equity securities in the event the initial public offering is not
completed. The Units are expected to be offered for sale to the
public at $5.60 per Unit. There is no assurance that the offering
will be successful. Management believes that the net proceeds of
the offering, if successful, will be sufficient to meet the
Company's anticipated cash requirements for a period of
approximately 24 months following the offering. Between December
31, 1995 and March 31, 1996, the Company obtained two $50,000 bridge
loans arranged for by the Company's underwriter. Both of the bridge
loans bear interest at 12% per annum and are payable at the earlier
of (a) December 31, 1996 or (b) the closing of an equity or debt
financing for not less than $1,000,000 or (c) the closing of any
sale of the Company's securities. During that time, the Company
also obtained two additional $50,000 loans which bear interest at 8%
per annum and are payable at the earlier of (a) January 31, 1997 or
(b) the closing of an equity or debt financing for not less than
$1,000,000 or (c) the closing of any sale of the Company's
securities. Also during each of May and June 1996, the Company
obtained an additional loan from the officer of $100,000 and
$65,000, respectively, which bear interest at rates of 7% and 9%,
respectively, per annum, are payable upon demand and are unsecured
and during July 1996, the Company obtained a loan of $100,000 which
bears interest at 9% per annum and is payable upon written demand on
or after December 31, 1996. The accompanying financial statements
do not include any adjustments that might result from the outcome of
the aforementioned uncertainty.

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

(1) CASH AND EQUIVALENTS:

For the purpose of the statement of cash flows, cash equivalents
include all highly liquid treasury bill instruments with original
maturities of three months or less.

(2) MARKETABLE SECURITIES:

Marketable securities are treasury bills stated at cost which
approximates market at December 31, 1994.

F-13

F-14

MEDJET INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):

(3) DEFERRED OFFERING COSTS:

Deferred offering costs consist of expenses incurred to date with
respect to a public offering which the Company is pursuing. These
costs will be charged against the proceeds of such offering or, in
the event the offering is unsuccessful, against operations in the
period in which the offering is aborted.

(4) PROPERTY, PLANT AND EQUIPMENT:

Property, plant and equipment are recorded at cost. Depreciation is
computed using primarily accelerated methods based upon the
estimated useful lives of the assets which range from 5 to 7 years.
Repairs and maintenance which do not extend the useful lives of the
related assets are expensed as incurred.

(5) AMORTIZATION:

Organizational costs are being amortized over sixty months on a
straight-line basis. Total amortization in 1996 (to date), 1995 and
1994 was $1,870, $7,478 and $5,183, respectively.

Patents are being amortized over seventeen years on a straight-line
basis. These costs will be expensed if and when it is concluded that
nonapproval or no future economic benefits are probable. Total
amortization in 1996 (to date), 1995 and 1994 was $286, $564 and
$208, respectively.

(6) NET LOSS PER SHARE:

Net loss per share is computed by dividing net loss by the weighted
average number of shares of Common Stock outstanding during the year
after giving effect to a 1.987538926 to 1 stock split of the
Company's Common Stock on the effective date based on the minimum
number of units to be sold in the offering.

(7) INCOME TAXES:

The Company, with the consent of its shareholders, has elected to be
an "S" Corporation under the Internal Revenue Code. Instead of
paying Federal corporate income taxes, the shareholders of an "S"
Corporation are taxed individually on their proportionate share of
the Company's taxable income. Therefore, no provision or liability
for Federal income taxes has been included in these financial
statements.

In accordance with the provision of Statement of Financial
Accounting Standards No. 109, "Accounting for Income Taxes" ("SFAS
No. 109"), deferred tax assets and liabilities are recognized for
the estimated future tax consequences attributable to differences
between the financial statement carrying amounts of existing assets
and liabilities and their respective tax bases for State purposes
only. Deferred tax assets and liabilities are measured using
enacted tax rates in effect for the years in which those temporary
differences are expected to be recovered or settled. Under SFAS No.
109, the effect on deferred tax assets and liabilities of a change
in state tax rates is recognized in income in the period that
includes the enactment date.

(8) RECLASSIFICATION:

Certain accounts in the prior year's financial statements have been
reclassified for comparative purposes to conform with presentation
in the current year's financial statements.

F-15

(9) UNAUDITED FINANCIAL STATEMENTS:

The accompanying unaudited financial statements as of March 31, 1996
and for the three months ended March 31, 1996 and 1995 have been
prepared by the Company pursuant to the rules and regulations of the
Securities and Exchange Commission. Accordingly, certain
information and note disclosures normally included in financial
statements prepared in conformity with generally accepted accounting
principles have been condensed or omitted. In the opinion of the
Company, all adjustments consisting of only normal recurring
adjustments necessary to present fairly the financial position,
results of operations and changes in cash flows for the periods
presented have been made.

F-16

MEDJET INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS

NOTE C - EQUITY TRANSACTIONS:

The Company's founder and President, Dr. Eugene I. Gordon ("Dr.
Gordon"), and three other original investors were initially issued
stock (pre-split) of the Company as follows between March 12, 1994
and May 1, 1994:

Price
Shares per
Issued share Total
------ ----- --------

Dr. Gordon, President 800,000 $.10 $80,000
Other Original Investors (3) 78,000 $.10 7,800
------- -------

878,000 $87,800
------- -------
------- -------

The sale of these securities was exempt from registration under
Section 4(2) of the Securities Act of 1933 ("the Act").

Pursuant to a first private placement offering that commenced May
25, 1994 and concluded July 28, 1994, the Company sold an aggregate
of 250,000 shares (pre-split) at $1 per share ($250,000). The sale
of these securities was exempt from registration under Rule 506,
Regulation D of the Act.

Pursuant to a second private placement offering that commenced
September 23, 1994 and concluded November 16, 1994, the Company sold
an aggregate of 85,004 shares (pre-split) at $6 per share
($510,024). The sale of these securities was exempt from
registration under Rule 506, Regulation D of the Act.

On September 30, 1994, the Company adopted its 1994 Stock Option
Plan ("the Plan"). The Plan provides that certain options granted
thereunder are intended to qualify as "incentive stock options"
within the meaning of Section 422A of the Internal Revenue Code of
1986, while non-qualified options may also be granted under the
Plan. The Plan provides for authorization of up to 25,000 shares.
The option price per share of Common Stock purchasable under an
incentive stock option shall be determined at the time of grant but
shall be not less than 100% of the fair market value of the Common
Stock on such date, or, in the case of a 10% Stockholder, the option
price per share shall be no less than 110% of the fair market value
of the Common Stock on the date an Incentive Stock Option is granted
to such 10% Stockholder.

Pursuant to a third private placement offering that commenced August
8, 1995 and concluded October 31, 1995, the Company offered an
additional 85,000 shares (pre-split) of which an aggregate of 19,833
shares (pre-split) have been sold through December 31, 1995 at $6
per share ($118,988). The sale of these securities was exempt from
registration under Rule 506, Regulation D of the Act.

On December 31, 1995, 833 additional common shares (pre-split) were
issued to Dr. Gordon at $6 per share ($5,000), bringing his total
share holdings of the Company's Common Stock to be 800,833 shares
(pre-split) at December 31, 1995.

NOTE D - DEVELOPMENT STAGE OPERATIONS:

The Company was formed December 16, 1993. Operations since then
have consisted primarily of raising capital, locating and acquiring
equipment, obtaining qualified staff, installing and testing
equipment and experimenting, testing and developing the procedures
necessary to produce positive results and to lay the foundation for
specific development for manufacturing and FDA approvals.

F-17

MEDJET INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS

NOTE E - NOTES PAYABLE

Between December 31, 1995 and March 31, 1996, the Company obtained
two $50,000 bridge loans arranged for by the Company's underwriter.
Both of the bridge loans bear interest at 12% per annum and are
payable at the earlier of (a) December 31, 1996 or (b) the closing
of an equity or debt financing for not less than $1,000,000 or (c)
the closing of any sale of the Company's securities. During that
time, the Company also obtained two additional $50,000 loans which
bear interest of 8% per annum and are payable at the earlier of (a)
January 31, 1997 or (b) the closing of an equity or debt financing
for not less than $1,000,000 or (c) the closing of any sale of the
Company's securities. The accompanying financial statements do not
include any adjustments that might result from the outcome of the
aforementioned uncertainty.

NOTE F - NOTES PAYABLE - OFFICER:

Loans made to the Company by the officer bear interest at 7% per
annum, except one loan that bears interest at 9% per annum, are
payable upon demand and are unsecured.

NOTE G - RETIREMENT PLAN:

The Company sponsors a qualified 401(k) plan covering substantially
all full time employees under which eligible employees can defer a
portion of their annual compensation. At the present time, the
Company makes no matching contributions to the plan.

NOTE H - INCOME TAXES:

The income tax provision is comprised of the following at March 31,
1996 (unaudited) and December 31 of each of 1995 and 1994:

State current provision $ 200 $ 200 $ 50
-------- -------- --------
-------- -------- --------

The Company's total deferred tax asset and valuation allowance at
March 31, 1996 (unaudited) and December 31 of each of 1995 and 1994
are as follows:

Total deferred tax asset $ 95,972 $ 80,083 $ 26,133
Less valuation allowance (95,972) (80,083) (26,133)
-------- -------- --------

Net deferred tax asset $ - $ - $ -
-------- -------- --------

The Company has available a $889,815 net operating loss carry
forward which may be used to reduce future state taxable income
available through December 31, 2002.

F-18

MEDJET INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS

NOTE I - OPERATING LEASE:

The Company leases its building and office space.

The following is a schedule by years of future minimum lease
payments as of March 31, 1996 under operating leases that have
initial or remaining non-cancelable lease terms in excess of one
year.

For the Year Ended March 31,
1997 57,444
1998 59,069
1999 64,764
--------

Total Minimum Lease Payments Required $181,277
--------
--------

Rent expense under the operating lease totaled $6,105, $24,066 and
$17,713 at March 31, 1996 (unaudited), December 31, 1995 and 1994,
respectively.

The lease also contains provisions for contingent rental payments
based upon increases in taxes, insurance and common area maintenance
expense.

NOTE J - SUBSEQUENT EVENTS:

On April 3, 1996, the Company filed with the SEC a registration
statement to sell and issue 1,071,429 units consisting of one share
of Common Stock and one redeemable Class A Common Stock purchase
warrant.

All costs associated with this offering will be deferred and
deducted from the proceeds from the sale of stock. If the Company
does not complete this offering, such costs will be charged to
expense.

On the effective date of the registration, the Company will give
effect to a 1.987538926 to 1 stock split of its Common Stock on all
shares of Common Stock outstanding based on the minimum number of
units to be sold in the offering.

During April and May 1996, the Company obtained additional bridge
financing in the amount of $100,000. In exchange for the $100,000,
the Company executed in favor of the lender two promissory notes,
each in the amount of $50,000. The notes accrue interest at 12% per
annum and are due on the earlier of (i) December 31, 1996 or (ii)
the closing date of this offering or (iii) the closing of an equity
or debt financing for not less than $1,000,000.

During each of May and June 1996, the Company obtained an additional
loan from an officer of $100,000 and $65,000, respectively, which
bear interest at 7% and 9%, respectively, per annum, are payable
upon demand and are unsecured.

During July 1996, the Company obtained an additional loan of
$100,000 from a stockholder which bears interest at 9% per annum and
is payable upon written demand made at any time on or after December
31, 1996.

F-19

NO DEALER, SALES REPRESENTATIVE OR OTHER INDIVIDUAL HAS BEEN AUTHORIZED TO GIVE
ANY INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS
IN CONNECTION WITH THIS OFFERING OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS
AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR THE UNDERWRITERS. THIS
PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR SOLICITATION OF AN OFFER TO
BUY THE COMMON STOCK BY ANYONE IN ANY JURISDICTION IN WHICH SUCH OFFER OR
SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR
SOLICITATION IS NOT QUALIFIED TO DO SO OR TO ANY PERSON TO WHOM IT IS UNLAWFUL
TO MAKE SUCH OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR
ANY SALE MADE HEREUNDER SHALL UNDER ANY CIRCUMSTANCES CREATE AN IMPLICATION THAT
THE INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO ITS
DATE.
---------

TABLE OF CONTENTS
Page

Available Information...................................................... 3
Prospectus Summary......................................................... 4
Risk Factors............................................................... 9
Use of Proceeds............................................................ 18
Dilution................................................................... 20
Capitalization............................................................. 21
Dividend Policy............................................................ 21
Plan of Operation.......................................................... 21
Business................................................................... 23
Management................................................................. 36
Principal Stockholders..................................................... 42
Certain Transactions....................................................... 43
Description of Securities.................................................. 43
Shares Eligible for Future Sale............................................ 45
Underwriting............................................................... 46
Legal Matters.............................................................. 48
Experts.................................................................... 48
Glossary................................................................... 49
Index to Financial Statements.............................................. F-1

---------

UNTIL _____________, 1996 [90 DAYS AFTER THE DATE OF THIS PROSPECTUS], ALL
DEALERS EFFECTING TRANSACTIONS IN THE REGISTERED SECURITIES, WHETHER OR NOT
PARTICIPATING IN THIS DISTRIBUTION, MAY BE REQUIRED TO DELIVER A PROSPECTUS.
THIS DELIVERY REQUIREMENT IS IN ADDITION TO THE OBLIGATION OF DEALERS TO DELIVER
A PROSPECTUS WHEN ACTING AS AN UNDERWRITER AND WITH RESPECT TO THEIR UNSOLD
ALLOTMENTS OR SUBSCRIPTIONS.

1,071,429 UNITS

Each Unit Consisting of One Share
of Common Stock and One Class A
Redeemable Common
Stock Purchase Warrant

MEDJET INC.

------------

PROSPECTUS

-----------

PATTERSON TRAVIS, INC.

_______, 1996

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 24. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

As permitted by Section 145 of the Delaware General Corporation Law
("GCL"), the Company's Certificate of Incorporation (the "Certificate") provides
that no Director shall be personally liable to the Company or any stockholder
for monetary damages for breach of fiduciary duty as a Director, except for
liability: (i) arising from payment of dividends or approval of a stock purchase
in violation of Section 174 of the GCL; (ii) for any breach of the duty of
loyalty to the Company or its stockholders; (iii) for acts or omissions not in
good faith or which involve intentional misconduct or a knowing violation of
law; or (iv) for any action from which the Director derived an improper personal
benefit. While the Certificate provides protection from awards for monetary
damages for breaches of the duty of care, it does not eliminate the Director's
duty of care. Accordingly, the Certificate will not affect the availability of
equitable remedies, such as an injunction, based on a Director's breach of the
duty of care. The provisions of the Certificate described above apply to
officers of the Company only if they are Directors of the Company and are acting
in their capacity as Directors, and does not apply to officers of the Company
who are not Directors.

In addition, the Company's By-Laws provide that the Company shall
indemnify its officers and Directors, employees and agents, to the fullest
extent permitted by the GCL. Under the GCL, directors and officers as well as
employees and individuals may be indemnified against expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement in connection
with specified actions, suits or proceedings, whether civil, criminal,
administrative or investigative (other than an action by or in the right of the
corporation as a derivative action) if they acted in good faith and in a manner
they reasonably believed to be in or not opposed to the best interests of the
corporation, and with respect to any criminal action or proceeding, had no
reasonable cause to believe their conduct was unlawful.

The Company has entered into indemnification agreements with its
officers and directors which provide for indemnification in favor of such
officers and directors by the Company to the fullest extent permitted by the
GCL.

Reference is made to Section 6 of the Form of Underwriting Agreement
(to be filed as Exhibit 1.1 to this Registration Statement) which provides for
indemnification of the Company's officers, Directors and controlling persons by
the Underwriters against certain civil liabilities, including liabilities under
the Securities Act of 1933, as amended (the "Securities Act").

INSOFAR AS INDEMNIFICATION FOR LIABILITIES ARISING UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, MAY BE PERMITTED TO DIRECTORS, OFFICERS OR PERSONS
CONTROLLING THE COMPANY PURSUANT TO THE FOREGOING PROVISIONS, THE COMPANY HAS
BEEN INFORMED THAT, IN THE OPINION OF THE SECURITIES AND EXCHANGE COMMISSION,
SUCH INDEMNIFICATION IS AGAINST PUBLIC POLICY AS EXPRESSED IN SUCH ACT AND IS
THEREFORE UNENFORCEABLE.

The Company is seeking a Director and Officer Liability Insurance
Policy, under which each Director and certain officers of the Company would be
insured against certain liabilities.

II-1

ITEM 25. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

The following expenses in connection with the issuance and distribution
of the securities being registered hereby (which exclude the Underwriter's
non-accountable expense allowance) will be borne by the Company.

Registration Fee . . . . . . . . . . . . $ 9,641
Transfer Agent and Registrar Fee* . . . . . . . . . . . . 9,000
NASD Filing Fee . . . . . . . . . . . . 3,296
NASDAQ Listing Fee . . . . . . . . . . . . 10,000
Printing Costs* . . . . . . . . . . . . 10,000
Legal Fees* . . . . . . . . . . . . 210,000
Accounting Fees* . . . . . . . . . . . . 30,000
Blue Sky Fees and Expenses* . . . . . . . . . . . . 55,000
Miscellaneous* . . . . . . . . . . . . 63
--------
Total . . . . . . . . . . . . $337,000
--------
--------

- -------------------
*Estimated

ITEM 26. RECENT SALES OF UNREGISTERED SECURITIES.

Described below are all securities which have been issued by the Company
since December 16, 1993 (the date of the Company's inception) without
registration under the Act. There were no underwriting discounts or commissions
paid in connection with the issuance of any such securities.

1. Between March 12 and May 1, 1994, the Company sold 800,000 shares
(pre-split) of Common Stock to Eugene I. Gordon, 48,000 shares (pre-split) of
Common Stock to Peretz Feder, and 15,000 shares (pre-split) of Common Stock to
each of Joseph Calderone, Jr. and Joseph Carroll, III (an aggregate of 878,000
shares) at a purchase price of $.10 per share (an aggregate purchase price of
$87,800). The sale of these securities was exempt from registration under
Section 4(2) of the Act, because no public offering was involved.

2. Between May 25, 1994 and July 28, 1994, the Company sold 25,000 shares
(pre-split) of Common Stock to each of 10 investors (an aggregate of 250,000
shares) at a purchase price of $1.00 per share (an aggregate purchase price of
$250,000). The sale of these securities was exempt from registration under Rule
506, Regulation D of the Act.

3. Between September 23, 1994 and November 16, 1994, the Company sold an
aggregate of 85,004 shares (pre-split) of its Common Stock to nine investors at
a purchase price of $6.00 per share (an aggregate purchase price of $510,024).
The sale of these securities was exempt from registration under Rule 506,
Regulation D of the Act.

4. Between August 8, 1995 and September 29, 1995, the Company sold an
aggregate of 19,000 shares (pre-split) of its Common Stock to four investors at
a purchase price of $6.00 per share (an aggregate purchase price of $114,000).
The sale of these securities was exempt from registration under Rule 506,
Regulation D of the Act.

5. On December 31, 1995, the Company sold 833 shares (pre-split) of its
Common Stock to Eugene I. Gordon at a purchase price of $6.00 per share (an
aggregate purchase price of $5,000). The sale of these securities was exempt
from registration under Section 4(2) of the Act, because no public offering was
involved.

II-2

ITEM 27. EXHIBITS.

The following is a list of all Exhibits filed as a part of this Registration
Statement.

Exhibit
Number Exhibit
------ -------

*1.1 Form of Underwriting Agreement.

1.2 [Omitted]

*1.3 Form of Selected Dealers Agreement.

3.1 Amended and Restated Certificate of Incorporation of the
Registrant.

3.2 By-Laws of the Registrant.

4.1 Form of Certificate evidencing the shares of Common Stock.

4.2 Form of Certificate evidencing the Units.

4.3 Form of Certificate evidencing the Class A Warrants (included
in Exhibit 4.5).

*4.4 Form of Underwriter's Option Agreement.

*4.5 Form of Warrant Agreement for the Class A Warrants.

4.6 [Omitted]

5.1 Opinion of Kelley Drye & Warren LLP.

10.1 Employment Agreement between the Registrant and Eugene I.
Gordon, dated as of March 15, 1996.

10.2 Employment Agreement between the Registrant and Thomas
Handschiegel, dated as of March 18, 1996.

10.3 Consulting Agreement between the Registrant and Joseph F.
Carroll III, dated as of April , 1994.

10.4 Consulting Agreement between the Registrant and Joseph P.
Calderone, Jr., dated as of April 1, 1994.

10.6 The Medjet Inc. 1994 Stock Option Plan, as amended.

10.7 Promissory Note from the Registrant in favor of Eugene Gordon
in the principal amount of $25,000, dated October 27, 1995.

10.8 Promissory Note from the Registrant in favor of Eugene Gordon
in the principal amount of $25,000, dated November 13, 1995.

10.9 Promissory Note from the Registrant in favor of Eugene Gordon
in the principal amount of $25,000, dated November 30, 1995.

10.10 Promissory Note from the Registrant in favor of Eugene Gordon
in the principal amount of $25,000, dated December 18, 1995.

10.11 Promissory Note from the Registrant in favor of Eugene Gordon
in the principal amount of $50,000, dated December 30, 1995.

10.12 Promissory Note from the Registrant in favor of Jan Wernick in
the principal amount of $50,000, dated February 6, 1996.

10.13 Promissory Note from the Registrant in favor of Steven G.
Cooperman in the principal amount of $50,000, dated February
26, 1996.

II-3

Exhibit
Number Exhibit
------ -------

10.14 Promissory Note from the Registrant in favor of Sanford J.
Hillsberg in the principal amount of $50,000, dated February
26, 1996.

10.15 Promissory Note from the Registrant in favor of Jan Wernick in
the principal amount of $50,000, dated March 14, 1996.

10.16 Agreement of Lease between the Registrant and Linpro Edison
Land Limited, dated May 13, 1994.

10.17 First Amendment to Lease between the Registrant and BCE
Associates, L.P., dated February 28, 1996.

10.18 Promissory Note from the Registrant in favor of Jan Wernick in
the principal amount of $50,000, dated April 15, 1996.

10.19 Promissory Note from the Registrant in favor of Jan Wernick in
the principal amount of $50,000, dated May 6, 1996.

10.20 Form of Consulting Agreement between the Registrant and Steven
G. Cooperman, dated as of _______, 1996.

10.21 Form of Consulting Agreement between the Registrant and
Sanford J. Hillsberg, dated as of _______, 1996.

10.22 Promissory Note from the Registrant in favor of Eugene Gordon
in the principal amount of $100,000, dated May 28, 1996.

10.23 Promissory Note from the Registrant in favor of Eugene Gordon
in the principal amount of $65,000, dated June 26, 1996.

*10.24 Promissory Note from the Registrant in favor of Robert P.
Lehmann in the principal amount of $100,000 dated July 19,
1996.

*23.1 Consent of Rosenberg Rich Baker Berman and Company.

23.2 Consent of Kelley Drye & Warren LLP (included in Exhibit 5.1).

23.3 Consent of Graham & James LLP.

23.4 Consent of Dean E. Snyder, Esquire.

24.1 Power of Attorney (included on signature page).

27 Amended Financial Data Schedule

- -----------------------
* Filed herewith.
Unless otherwise indicated, all exhibits were previously filed.

II-4

ITEM 28. UNDERTAKINGS.

(a) Insofar as indemnification for liabilities arising under the Securities
Act of 1933, as amended (the "Securities Act"), may be permitted to directors,
officers and controlling persons of the Company, the Company has been advised
that, in the opinion of the Securities and Exchange Commission (the
"Commission"), such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the Company
of expenses incurred or paid by a director, officer or controlling person of the
Company in the successful defense of any action, suit or proceeding) is asserted
by such director, officer or controlling person in connection with the
securities being registered, the Company will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question of whether such indemnification by it
is against public policy as expressed in the Securities Act and will be governed
by the final adjudication of such issue.

(b) The Company hereby undertakes:

(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:

(i) To include a prospectus required by Section 10(a)(3)
of the Securities Act;

(ii) To reflect in the prospectus any facts or events
which, individually or in the aggregate, represent a fundamental change in the
information set forth in this Registration Statement. Notwithstanding the
foregoing, any increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated maximum
offering range may be reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume
and price represent no more than a 20% change in the maximum aggregate offering
price set forth in the "Calculation of Registration Fee" table in the effective
Registration Statement;

(iii) To include any additional or changed material
information on the plan of distribution.

(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement of the securities offered, and the offering of such
securities at that time to be the initial BONA FIDE offering.

(3) To file a post-effective amendment to remove from registration
any of the securities that remain unsold at the end of the offering.

(4) For purposes of determining any liability under the Securities
Act, the information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in the form of
prospectus filed by the Company pursuant to Rule 424(b)(1) or (4), or 497(h)
under the Securities Act shall be deemed to be part of this Registration
Statement as of the time it was declared effective.

(5) For the purpose of determining any liability under the
Securities Act, each post-effective amendment that contains a form of prospectus
shall be deemed to be a new Registration Statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.

(c) The Company will provide to the underwriter at the closing specified in
the underwriting agreement certificates in such denominations and registered in
such names as required by the underwriter to permit prompt delivery to each
purchaser.

II-5

SIGNATURES

In accordance with the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form SB-2 and authorized this amendment to the
registration statement to be signed on its behalf by the undersigned, in the
City of New York, State of New York, on July 23, 1996.

MEDJET INC.

By:/s/ Eugene I. Gordon
-------------------------------
Eugene I. Gordon
PRESIDENT AND CHAIRMAN OF THE BOARD

In accordance with the requirements of the Securities Act of 1933, this
amendment to the registration statement has been signed by the following persons
in the capacities and on the dates stated.

SIGNATURE TITLE DATE
/s/ Eugene I. Gordon President and Chairman of the July 23, 1996
- ------------------------- Board (Principal Executive
Eugene I. Gordon Officer)

/s/ Thomas M. Handshiegel Chief Financial Officer and Vice July 23, 1996
- ------------------------- President for Finance and Human
Thomas M. Handschiegel Resources (Principal Financial and
Accounting Officer)

* Director July 23, 1996
- -------------------------
Steven G. Cooperman

*By: /s/ Thomas M. Handshiegel
-------------------------
Attorney-in-Fact

INDEX TO EXHIBITS

Exhibit Sequentially
Number Exhibit Numbered Page
------ ------- -------------

*1.1 Form of Underwriting Agreement.

1.2 [Omitted]

*1.3 Form of Selected Dealers Agreement.

3.1 Amended and Restated Certificate of
Incorporation of the Registrant.

3.2 By-Laws of the Registrant.

4.1 Form of Certificate evidencing the shares of
Common Stock.

4.2 Form of Certificate evidencing the Units.

4.3 Form of Certificate evidencing the Class A
Warrants (included in Exhibit 4.5).

*4.4 Form of Underwriter's Option Agreement.

*4.5 Form of Warrant Agreement for the Class A
Warrants.

4.6 [Omitted]

5.1 Opinion of Kelley Drye & Warren LLP.

10.1 Employment Agreement between the Registrant
and Eugene I. Gordon, dated as of March 15,
1996.

10.2 Employment Agreement between the Registrant
and Thomas Handschiegel, dated as of March 18,
1996.

10.3 Consulting Agreement between the Registrant
and Joseph F. Carroll, III, dated as of April
____, 1994.

10.4 Consulting Agreement between the Registrant
and Joseph P. Calderone, Jr., dated as of
April 1, 1994.

10.6 The Medjet Inc. 1994 Stock Option Plan, as
amended.

10.7 Promissory Note from the Registrant in favor
of Eugene Gordon in the principal amount of
$25,000, dated October 27, 1995.

10.8 Promissory Note from the Registrant in favor
of Eugene Gordon in the principal amount of
$25,000, dated November 13, 1995.

10.9 Promissory Note from the Registrant in favor
of Eugene Gordon in the principal amount of
$25,000, dated November 30, 1995.

10.10 Promissory Note from the Registrant in favor
of Eugene Gordon in the principal amount of
$25,000, dated December 18, 1995.

10.11 Promissory Note from the Registrant in favor
of Eugene Gordon in the principal amount of
$50,000, dated December 30, 1995.

10.12 Promissory Note from the Registrant in favor
of Jan Wernick in the principal amount of
$50,000, dated February 6, 1996.

10.13 Promissory Note from the Registrant in favor
of Steven G. Cooperman in the principal amount
of $50,000, dated February 26, 1996.

10.14 Promissory Note from the Registrant in favor
of Sanford J. Hillsberg in the principal
amount of $50,000, dated February 26, 1996.

10.15 Promissory Note from the Registrant in favor
of Jan Wernick in the principal amount of
$50,000, dated March 14, 1996.

10.16 Agreement of Lease between the Registrant and
Linpro Edison Land Limited, dated May 13,
1994.

10.17 First Amendment to Lease between the
Registrant and BCE Associates, L.P., dated
February 28, 1996.

10.18 Promissory Note from the Registrant in favor
of Jan Wernick in the principal amount of
$50,000, dated April 15, 1996.

10.19 Promissory Note from the Registrant in favor
of Jan Wernick in the principal amount of
$50,000, dated May 6, 1996.

10.20 Form of Consulting Agreement between the
Registrant and Steven G. Cooperman, dated as
of _______, 1996.

10.21 Form of Consulting Agreement between the
Registrant and Sanford J. Hillsberg, dated as
of _______, 1996.

10.22 Promissory Note from the Registrant in favor
of Eugene Gordon in the principal amount of
$100,000, dated May 28, 1996.

10.23 Promissory Note from the Registrant in favor
of Eugene Gordon in the principal amount of
$65,000, dated June 26, 1996.

*10.24 Promissory Note from the Registrant in favor
of Robert P. Lehmann in the principal amount
of $100,000 dated July 19, 1996.

*23.1 Consent of Rosenberg Rich Baker Berman and
Company.

23.2 Consent of Kelley Drye & Warren LLP (included in
Exhibit 5.1).

23.3 Consent of Graham & James LLP.

23.4 Consent of Dean E. Snyder, Esquire.

24.1 Power of Attorney (included on signature page).

27 Amended Financial Data Schedule

- -----------------------
* Filed herewith.
Unless otherwise indicated, all exhibits were previously filed.