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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
|X| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2002
OR
|_| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934 For the transition period from to
Commission File Number: 1-11765
MEDJET INC.
(Name of Small Business Issuer as Specified in its Charter)
DELAWARE 22-3283541
(State or Other Jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or Organization)
1090 KING GEORGES POST ROAD, SUITE 301
EDISON, NEW JERSEY 08837
(Address of Principal Executive Offices)
(732) 738-3990
(Issuer's Telephone Number, Including Area Code)
(Former Name, Former Address and Former Fiscal Year, if
Changed Since Last Report)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days. YES |X| NO
|_|
As of August 9, 2002, 3,901,431 shares of Common Stock, par value $.001
per share, were outstanding.
Transitional Small Business Disclosure Format: Yes |_| No |X|
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Part l - FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
MEDJET INC.
(A Development Stage Company)
Condensed Interim Balance Sheet
June 30, 2002
(Unaudited)
ASSETS
Current Assets:
Cash and cash equivalents $ 401,949
Prepaid expenses 18,152
------------
Total Current Assets 420,101
------------
Property and Equipment - less accumulated depreciation
of $374,145 68,047
Patents and Trademarks - less accumulated amortization
of $55,703 273,758
Security deposits 8,661
------------
Total Assets $ 770,567
============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accrued liabilities $ 109,814
Notes payable - Officer 160,000
Capital Lease Obligation -
Deferred Revenue 105,700
Deferred income-merger option 62,499
------------
Total Liabilities 438,013
------------
Stockholders' Equity:
Common stock, $.001 par value, 30,000,000 shares
authorized, 3,935,220 shares issued and 3,901,431
shares outstanding 3,935
Preferred stock, $.01 par value, 1,000,000 shares
authorized, 10,400 shares designated as Series B
Convertible Preferred issued and outstanding 104
Additional paid-in capital 7,981,932
Deferred Charge (77,001)
Accumulated deficit (including deficit accumulated
during development stage of $9,079,385 of which
$1,556,204 was applied to additional paid-in
capital upon conversion from an "S" to a "C"
corporation) (7,574,716)
Less: Treasury stock, 33,789 shares, at cost (1,700)
------------
Total Stockholders' Equity 332,554
------------
Total Liabilities and Stockholders' Equity $ 770,567
============
See notes to the condensed interim financial statements.
1
MEDJET INC.
(A Development Stage Company)
Condensed Interim Statements of Operations
For The Three and Six Months Ended June 30, 2002 and 2001
And The Period From December 16, 1993 (Date of Inception) to June 30, 2002
(Unaudited)
Period from
Three Months Ended Six Months Ended December 16,
June 30, June 30, 1993
----------------------- ------------------------- (Inception) to
2002 2001 2002 2001 June 30, 2002
----------- ----------- ----------- ------------ -----------------
Revenues:
Revenue $ 942,344 $ 100,500 $1,597,300 $ 100,500 $ 3,829,800
---------- ---------- ---------- ---------- -----------
Total revenues $ 942,344 $ 100,500 $1,597,300 $ 100,500 $ 3,829,800
---------- ---------- ---------- ---------- -----------
Expenses:
Research, development,
general and administrative 983,608 219,055 1,790,243 515,375 14,364,354
---------- ---------- ---------- ---------- -----------
Total expenses 983,608 219,055 1,790,243 515,375 14,364,354
---------- ---------- ---------- ---------- -----------
Loss from Operations (41,264) (118,555) (192,943) (414,875) (10,534,554)
Other Income (Expense):
Merger Option Income 125,001 - 250,001 - 437,501
Interest Income 1,327 91 2,698 1,525 354,349
Interest Expense (2,113) (4,881) (4,433) (8,709) (94,232)
---------- ---------- ---------- ---------- -----------
124,215 (4,790) 248,266 (7,184) 697,618
---------- ---------- ---------- ---------- -----------
Income (Loss) Before
Income Tax 82,951 (123,345) 55,323 (422,059) (9,836,936)
Income tax 240 200 240 200 (757,551)
---------- ---------- ---------- ---------- -----------
Net Income (Loss) 82,711 (123,545) 55,083 (422,259) (9,079,385)
Dividends on Preferred Stock - - - - 184,923
---------- ---------- ---------- ---------- -----------
Net Income (Loss)
Attributable to
Common Shareholders $ 82,711 $ (123,545) $ 55,083 $ (422,259) $(9,264,308)
========== ========== ========== ========== ===========
Basic and Diluted Net
Income (Loss) Per Share $ 0.02 $ (0.03) $ 0.01 $ (0.11) $ (2.94)
========== ========== ========== ========== ===========
Weighted average shares used to
compute net income (loss)
per share:
Basic 3,901,431 3,901,431 3,901,431 3,901,431 3,149,118
========== ========== ========== ========== ===========
Diluted 5,382,736 3,901,431 5,396,211 3,901,431 3,149,118
========== ========== ========== ========== ===========
See notes to the condensed interim financial statements.
2
MEDJET INC.
(A Development Stage Company)
Condensed Interim Statements of Cash Flows
For The Six Months Ended June 30, 2002 and 2001
And The Period From December 16, 1993 (Date of Inception) to June 30, 2002
(Unaudited)
For the Six Months
Ended Period from
June 30, December 16,
----------------------- 1993 (Inception) to
2002 2001 June 30, 2002
------------ --------- -------------------
Cash Flows from Operating Activities $ 260,551 $(236,493) $ $(7,609,317)
Cash Flows from Investing Activities (59,403) (25,025) (980,601)
Cash Flows from Financing Activities (12,676) 99,600 8,991,867
------------ ---------- ----------------
Net Increase (Decrease) in Cash and Cash Equivalents 188,472 (161,918) 401,949
Cash and Cash Equivalents - Beginning of Period 213,477 183,665 -
------------ ---------- ----------------
Cash and Cash Equivalents - End of Period $ 401,949 $ 21,747 $ 401,949
------------ ---------- ----------------
Supplemental Disclosures of Cash Flow Information:
Cash paid for:
Income taxes $ 240 $ 200 $ 840
============ ========== ================
Interest expense $ 4,433 $ 4,881 $ 67,741
============ ========== ================
See notes to the condensed interim financial statements.
3
MEDJET INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE
CONDENSED INTERIM FINANCIAL STATEMENTS
NOTE A - NATURE OF ORGANIZATION AND BASIS OF PRESENTATION:
(1) NATURE OF ORGANIZATION:
----------------------
Medjet Inc. (the "Company") was incorporated in the State of
Delaware on December 16, 1993, and is in the development stage. The
Company is engaged in research and development of medical
technology, with a current emphasis on ophthalmic surgical
technology and equipment.
(2) BASIS OF PRESENTATION:
---------------------
The Condensed Interim Financial Statements included herein have been
prepared by the Company, without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission. Certain
information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted as permitted by such rules
and regulations.
The Condensed Interim Financial Statements included herein reflect,
in the opinion of management, all adjustments (consisting only of
normal recurring adjustments) necessary to present fairly the
results for the interim periods. The results of operations for the
six-month period ended June 30, 2002 are not necessarily indicative
of results to be expected for the fiscal year ending December 31,
2002.
NOTE B - NET INCOME (LOSS) PER SHARE:
Basic net income (loss) per share, in accordance with the provisions
of Financial Accounting Standards No. 128, "Earnings Per Share," is
computed by dividing net income (loss) by the weighted average
number of shares of Common Stock outstanding during the period.
Diluted net income per share includes additional dilution from
potential issuance of common stock, such as stock issuable pursuant
to the exercise of stock options and warrants outstanding and the
conversion of preferred stock. Common Stock equivalents for the
three and six months ended June 30, 2001, and for the period from
December 16, 1993 (inception) to June 30, 2002, have not been
included in the computation of dilutive loss per share as the effect
would be anti-dilutive.
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Item 2. MANAGEMENT'S DISCUSSION AND
ANALYSIS OR PLAN OF OPERATION
THIS QUARTERLY REPORT ON FORM 10-QSB, INCLUDING ANY DOCUMENTS THAT ARE
INCORPORATED BY REFERENCE, CONTAINS FORWARD-LOOKING STATEMENTS WITHIN THE
MEANING OF SECTION 27A OF THE SECURITIES ACT OF 1933, AS AMENDED, AND SECTION
21E OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. GENERALLY, SUCH
STATEMENTS ARE INDICATED BY WORDS OR PHRASES SUCH AS "ANTICIPATES," "EXPECTS,"
"INTENDS," "BELIEVES" AND SIMILAR WORDS AND PHRASES. SUCH STATEMENTS ARE BASED
ON THE COMPANY'S CURRENT EXPECTATIONS AND ARE SUBJECT TO RISKS, UNCERTAINTIES
AND ASSUMPTIONS. CERTAIN OF THESE RISKS ARE DESCRIBED OR REFERRED TO BELOW OR IN
PART I, ITEM 6 OF THE COMPANY'S ANNUAL REPORT ON FORM 10-KSB/A2 FOR THE FISCAL
YEAR ENDED DECEMBER 31, 2001, ON FILE WITH THE SECURITIES AND EXCHANGE
COMMISSION, AND ARE INCORPORATED HEREIN BY THIS REFERENCE. SHOULD ONE OR MORE OF
THESE RISKS OR UNCERTAINTIES MATERIALIZE, OR SHOULD UNDERLYING ASSUMPTIONS PROVE
INCORRECT, ACTUAL RESULTS MAY VARY MATERIALLY FROM THOSE ANTICIPATED, EXPECTED,
INTENDED OR BELIEVED.
GENERAL
The Company is engaged in research and development for manufacture of medical
technology, with a current emphasis on ophthalmic surgical technology and
equipment, and has developed a proprietary technology and derivative devices
based on microjets. The Company expects, during the remainder of 2002, to
continue its research and development activities, focusing principally on
ophthalmic surgical technology and equipment for vision correction surgery. The
Company is a development stage company.
On August 17, 2001, the Company, VISX, Inc. and Orion Acquisition Corp., a
wholly-owned subsidiary of VISX, entered into an Agreement and Plan of Merger
and Reorganization, which provides, among other things, for the potential merger
of Orion Acquisition Corp. with and into the Company, at VISX's option. Under
the terms of the merger agreement, if VISX chooses to go forward with the merger
and subject to other customary conditions to closing, each outstanding share of
common stock of the Company would be canceled and extinguished and would be
converted automatically into the right to receive $2.00 in cash at the effective
time of the merger. Upon consummation of the merger, the Company would become a
wholly-owned subsidiary of VISX.
VISX has the option to terminate the merger agreement at any time during the
one-year period following the date of its execution, but prior to the effective
time of the merger, for any or no reason. In consideration for this one-year
option to elect whether or not to proceed with the merger, VISX paid the Company
$500,000 concurrently with the execution of the merger agreement.
In connection with the execution of the merger agreement with VISX, the Company
and VISX also entered into a separate one-year research and development
agreement in August 2001 pursuant to which VISX has agreed to provide monthly
funding to the Company in order to support research and development work
associated with development of waterjet related technology and products,
including a waterjet microkeratome. This agreement
5
provides for minimum payments of $150,000 per month for the first six months and
$100,000 for the second six months.
VISX agreed that it would provide the Company with funding pursuant to the
research and development agreement regardless of whether the merger was
completed. In return, the Company agreed to add a provision to the merger
agreement providing for a grant to VISX of warrants to purchase 1,320,000 shares
of the Company's common stock at an exercise price of $0.75 per share. These
warrants were issued to VISX to provide it with an opportunity to make an
additional equity investment in the Company if the proposed merger did not occur
after VISX had provided significant research and development funding to the
Company.
The closing of the merger is contingent upon, among other things, the receipt of
any necessary third party consents and other customary closing conditions.
Notwithstanding the foregoing, VISX may elect not to consummate the merger even
if all of the other conditions set forth in the merger agreement are satisfied
by the Company. The merger agreement also provides for termination fees of
$500,000 payable by one party to the other under various conditions of
termination.
Many of the Company's forward-looking statements and plans in this report are
based on the assumption that VISX will exercise its option to complete the
merger. If VISX elects to terminate the merger agreement, the termination fee
payable by VISX to the Company is expected to provide the Company with the
opportunity to evaluate its position and alternatives for future operations.
RESULTS OF OPERATIONS
The Company has not yet initiated sales of its products. The Company generated
revenues of $942,344 and $1,597,300 during the three and six-month periods ended
June 30, 2002, respectively, and generated $100,500 of revenues for each of the
comparable periods in 2001. The revenues generated during the three-month and
six- month periods ended June 30, 2002 resulted from payments from VISX under a
research and development agreement pursuant to which VISX has agreed to provide
funding to the Company through August 2002 to pursue waterjet related
technologies and products, including the Company's waterjet microkeratome. The
revenues generated during the three months and six months ended June 30, 2001
resulted almost entirely from a prior research and development agreement with
VISX.
Total expenses during the three months ended June 30, 2002 increased by $764,553
(349%) to $983,608 from $219,055 for the comparable period of 2001. Total
expenses during the six months ended June 30, 2002 increased by $1,274,868 (247
%) to $1,790,243 from $515,375 for the comparable period of 2001. These
increases were primarily due to an increase in purchases for materials, testing
and analysis and other costs associated with continuing development activities.
Total expenses for the three months and six months ended June 30, 2002 included
charges of $153,999 and $307,999, respectively, resulting from the amortization
of the value of the warrant to purchase 1,320,000 shares of the Company's
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Common Stock issued to VISX in connection with the execution of the merger
agreement and the research and development agreement. The total deferred charge
of $616,000 in connection with the issuance of this warrant is being amortized
over the one-year period corresponding to the one-year term of the research and
development agreement.
Other income (expense) for the three months and six months ended June 30, 2002
included $125,001 and $250,001 of merger option income, respectively, based on
the $500,000 payment by VISX to the Company made concurrently with the execution
of the merger agreement in August 2001. This $500,000 payment is being
recognized over the one-year period during which VISX has the option to elect
whether or not to proceed with the merger. This payment was made by VISX in
consideration for this option.
Net interest expense for the three months ended June 30, 2002 was $(786)
compared to $(4,790) for the comparable period of 2001. Net interest expense for
the six months ended June 30, 2002 was $(1,735) compared to $(7,184) for the
comparable period for 2001.These decreases resulted principally from decreased
interest expense relating to the loan provided by the Company's Chief Executive
Officer due to lower interest rates and a lower outstanding principal balance on
the loan in the three and six months ended June 30, 2002 compared to the three
and six months ended June 30, 2001.
LIQUIDITY AND CAPITAL RESOURCES
As of June 30, 2002, the Company's cash and cash equivalents was $401,949 and
its working capital was $(17,912).
During March 1999, Eugene I. Gordon, Ph.D., the Company's Chairman and Chief
Executive Officer, agreed to make available to the Company an unsecured loan of
up to $250,000. Under the terms of this agreement, the Company issued to Dr.
Gordon warrants to purchase up to 50,000 shares of the Company's unregistered
Common Stock and agreed to pay a market interest rate on amounts borrowed.
Through June 30, 2002, amounts advanced under this agreement totaled $160,000.
As of June 30, 2002, the amount owed to Dr. Gordon is $160,000 with interest
paid monthly. Principal amounts outstanding under this loan are due and payable
on January 26, 2009.
In connection with the execution of the merger agreement with VISX, the Company
and VISX also entered into a one-year research and development agreement in
August 2001 pursuant to which VISX has agreed to provide monthly funding to the
Company in order to support research and development work associated with
development of waterjet related technology and products, including a waterjet
microkeratome. This agreement provides for minimum monthly payments of $150,000
for the first six months and $100,000 for the second six months.
In 1998, the State of New Jersey enacted legislation allowing emerging
technology and/or biotechnology companies to sell their unused New Jersey net
operating loss carryover ("NOLs") and research and development tax credits ("R&D
Credits") to corporate taxpayers in New Jersey. Under this program, the New
Jersey Department of Taxation certifies annual
7
NOLs and R&D Credits which may be sold to third parties. Generally, corporations
operating in New Jersey are subject to a 9% tax on net operating profits.
Companies meeting certain criteria and that had NOLs may apply for certificates
for 9% of their cumulative state certified NOLs and 3% of their R&D Credits. The
total value of the certificates for all companies applying is limited to a fixed
amount, as established by statute. As a result, the value of the certificates
issued is usually less than the total NOLs and R&D Credit amounts for which
applications are submitted, depending on the number of companies applying for
such certificates and the amounts claimed. Any remaining amounts of NOLs and R&D
Credits exceeding the face value of the certificates issued can be carried over
into subsequent years. Whatever certificates are received may be sold for a
percentage of their face value, typically between 80% and 85%. The buyers of
these certificates are then entitled to use these certificates at 100% of their
face value to reduce their own New Jersey state income tax payments. The Company
is permitted to apply for such certificates beginning in June with respect to
NOLs and R&D Credits relating to prior fiscal years. The New Jersey Department
of Taxation generally takes about six months to process these applications and
issue the certificates. As a result, the Company generally does not sell its
eligible NOLs and R&D Credits relating to a given year until near the end of the
following year. To the extent that the NOLs and R&D Credits are sold, they will
be unavailable to the Company to offset future New Jersey state income taxes.
In 2002, the Company applied for certificates totaling approximately $92,252
which consists of tax benefits of approximately $82,983 for the year ended
December 31, 2001 and $9,269 in tax benefits carried over from the prior year.
Assuming the Company receives a certificate for the entire amount for which it
applies, and assuming the Company sells such certificate for 84% of its face
value, the Company expects to receive net proceeds of approximately $77,492 in
late 2002 from the sale of its certificates.
The Company's current research and development agreement with VISX is scheduled
to expire on August 17, 2002. In addition, VISX's option to terminate the merger
agreement for any or no reason also expires on August 17, 2002. The Company and
VISX are currently negotiating an extension of the research and development
agreement together with a corresponding extension of VISX's option period under
the merger agreement. The Company does not believe that these negotiations will
be completed by August 17, 2002 and may take up to an additional 30 days
thereafter to complete. Although the Company believes that it will reach an
agreement with VISX to extend the term of the research and development agreement
along with the term of VISX's option period under the merger agreement, there
can be no assurance that the Company will be able to do so. Furthermore, even if
the research and development agreement is extended, there can be no assurance at
this time as to the length of the extended term of the agreement or the level of
monthly funding to be provided by VISX.
The Company anticipates that, assuming that the research and development
agreement is extended for at least an additional four months and provides for at
least the minimum monthly funding levels provided under the current agreement,
the monthly research and development funding from VISX, together with the
Company's cash on hand, and, to a lesser extent, the sale
8
of its NOLs and R&D Credits, will be sufficient to meet the Company's working
capital and planned capital expenditure requirements through the end of 2002.
If, however, the Company incurs unexpected expenses, is unable to extend the
term of its research and development agreement with VISX or, if the agreement is
extended, the term of the extension is less than four months or the agreement
does not provide funding at substantially the current minimum monthly funding
levels, the Company will likely require additional financing prior to the end of
2002 in order to maintain its current operations. The Company has no current
arrangements with respect to any additional financing and, pursuant to the terms
of the merger agreement with VISX, is currently precluded from seeking such
additional financing. Consequently, there can be no assurance that any
additional financing will be available to the Company, on commercially
reasonable terms, or at all. The failure to obtain any needed financing would
have a material adverse effect on the Company, including causing a substantial
reduction in the Company's operations.
If the research and development agreement and VISX's option period under the
merger agreement are not extended, upon the expiration of the option period,
Medjet would have the right to terminate the merger agreement, and upon such
termination, would generally be entitled to receive a $500,000 termination fee
from VISX. As a result, Medjet may elect to terminate the merger agreement and
use the proceeds from the termination fee to fund operations while it sought
another strategic partner for its business. However, there can be no assurance
that the Company would be able to locate such a strategic partner or enter into
a definitive agreement with such a strategic partner on commercially reasonable
terms or at all.
SIGNIFICANT ACCOUNTING POLICIES AND ESTIMATES
General
The Company's discussion and analysis of its financial condition and results of
operations are based upon the Company's financial statements, which have been
prepared in accordance with accounting principles generally accepted in the
United States. The preparation of these financial statements requires the
Company to make estimates and judgments that affect the reported amounts of
assets, liabilities, revenues and expenses and related disclosure of contingent
assets and liabilities. On an ongoing basis, the Company evaluates its
estimates, including those related to intangible assets, income taxes,
contingencies and litigation. The Company bases its estimates on historical
experience and on various other assumptions that are believed to be reasonable
under the circumstances, the results of which form the basis for making
judgments about the carrying values of assets and liabilities that are not
readily apparent from other sources. Actual results may differ from these
estimates under different assumptions or conditions.
Patents
Costs incurred in connection with patent applications, principally legal and
consulting fees, are capitalized. Once a patent is granted, these costs are
amortized over the lesser of the life of the patent, generally 20 years, or the
estimated future economic life of the technology underlying the patent. Once the
amortization period begins, management continues to evaluate the estimated
future economic life of the patents. Should it be determined that a
9
shorter life is estimated than the original estimated future life, the
amortization period is adjusted accordingly. Should a patent application be
abandoned or not approved, the costs incurred in connection with the application
are expensed.
Revenue Recognition
The Company's revenues for the six months ended June 30, 2002 resulted from
payments from VISX pursuant to the one-year research and development agreement
that the Company and VISX executed in August 2001. Pursuant to this agreement,
VISX provides monthly funding to the Company in order to finance costs to
support research, development and experimental work incurred to develop the
Company's microjet related technology and products. The monthly payments
advanced by VISX are advanced at the beginning of each month against a budget of
costs expected to be incurred during that month. Should the advanced funds
exceed the amounts expensed at the end of the month, the excess funding would be
recorded as deferred revenue until the costs are incurred.
ADDITIONAL FACTORS THAT MAY AFFECT FUTURE RESULTS
The Company has been in the development stage and has not sold any products. To
date, the Company's research and development activities on vision correction
devices have been limited to constructing and testing experimental versions of
microkeratomes and associated console for eye surgery and conducting a limited
number of feasibility studies using enucleated porcine, rabbit and human eyes,
and live rabbits to prove that the beam of water can smoothly incise and shape
the anterior surface of the cornea, that there is no loss of tissue by erosion,
and that the cornea will heal properly after the surgery.
If the proposed merger with VISX is not completed, the Company will depend on
third parties for the manufacture of components of its products. This may
adversely affect the Company's profit margins and its ability to develop and
deliver such products on a timely basis. Moreover, there can be no assurance
that such third 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 and any such failure could have a material
adverse effect on the Company.
If the proposed merger with VISX is not completed, the Company intends to
undertake the assembly, test and marketing of its microjet products on a limited
scale. However, it would need to pursue other possible arrangements for
larger-scale manufacturing, marketing and distribution. To the extent that the
Company fails to enter into such arrangements, the Company would be subject to
the risks and uncertainties described under "Additional Factors That May Affect
Future Results - No Manufacturing Experience; Dependence on Third Parties," in
the Company's Annual Report on Form 10-KSB/A2, which information is incorporated
herein by reference.
If the Company does not enter into license or distribution agreements with
respect to its products, it may undertake the marketing and sale itself. In such
event, the Company intends to market and sell its products in the United States
and certain foreign countries, if and when
10
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 capabilities 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 marketing or sales
efforts 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.
Acceptance of the Company's products is difficult to predict and will require
substantial marketing efforts and the expenditure of significant funds by the
Company. There can be no assurance that the products will be accepted by the
medical community once they are permitted or approved. Market acceptance of the
Company's products will depend in large part upon the Company's ability to
demonstrate the operational advantages, safety and cost-effectiveness of its
products compared to other comparable surgical techniques. Failure of the
products to achieve market acceptance will have a material adverse effect on the
Company's financial condition and results of operations.
At present, the Company's only products (although still in development stage)
are its microkeratomes, and the Company expects that its microkeratomes will be,
if and when commercially available, its sole products for an indefinite period
of time. The Company's present narrow focus on particular products 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.
11
PART II - OTHER INFORMATION
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
11 Statement re Computation of Net Income (Loss)
per Share
99.1 Certification Pursuant to 18. U.S.C. Section
1350, as Adopted Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
99.2 Certification Pursuant to 18. U.S.C. Section
1350, as Adopted Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
(b) Reports on Form 8-K
None
12
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Dated: August 14, 2002 MEDJET INC.
/S/ EUGENE I. GORDON, PH.D.
-------------------------------
Eugene I. Gordon, Ph.D.
Chairman of the Board and
Chief Executive Officer
/S/ CHERYL A. BLAKE
-------------------------------
Cheryl A. Blake
Vice President - Finance and
Human Resources
(Principal financial and
accounting officer)
13