-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, QoJU13Is6lQPmQsaK+Mf/dUiO1soT+p+vMIWiE2xtb/1BhwrM0yr6BYd+kHLHwfO QzG2mfChujAmKTzcE7Yq1Q== 0001104659-00-000215.txt : 20000512 0001104659-00-000215.hdr.sgml : 20000512 ACCESSION NUMBER: 0001104659-00-000215 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20000331 FILED AS OF DATE: 20000511 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MEDJET INC CENTRAL INDEX KEY: 0000932265 STANDARD INDUSTRIAL CLASSIFICATION: SURGICAL & MEDICAL INSTRUMENTS & APPARATUS [3841] IRS NUMBER: 223283541 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 001-11765 FILM NUMBER: 626812 BUSINESS ADDRESS: STREET 1: 1090 KING GEORGE POST RD STREET 2: STE 301 CITY: EDISON STATE: NJ ZIP: 08837 BUSINESS PHONE: 7327383990 MAIL ADDRESS: STREET 1: 1090 KING GEORGES POST ROAD STREET 2: SUITE 301 CITY: EDISON STATE: NJ ZIP: 08837 10QSB 1 QUARTERLY REPORT 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 March 31, 2000 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. (Exact name of Small Business Issuer as Specified in its Charter) DELAWARE 22-3283541 (State or Other Jurisdiction (I.R.S. Employer Identification No.) of Incorporation or Organization) 1090 KING GEORGES POST ROAD, SUITE 301 EDISON, NEW JERSEY 08837 (Address of Principal Executive Offices) (732) 738-3990 (Registrant'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 May 8, 2000, 3,901,431 shares of Common Stock, par value $.001 per share, were outstanding. Transitional Small Business Disclosure Format: Yes |_| No |X| MEDJET INC. (A Development Stage Company) Condensed Interim Balance Sheet March 31, 2000 (Unaudited) ASSETS Current Assets: Cash and cash equivalents $ 658,714 Prepaid expenses 61,815 -------------- Total Current Assets 720,529 -------------- Property and Equipment - less accumulated depreciation of $334,915 100,331 Patents and Trademarks - less accumulated amortization of $32,532 203,812 Deferred tax asset 267,063 Security deposits 4,837 -------------- Total Assets $ 1,296,572 ============== LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Accounts payable and accrued liabilities $ 224,022 Deferred revenues 175,000 Notes payable - Officer 150,000 -------------- Total Liabilities 549,022 -------------- 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 7,365,932 Accumulated deficit (including deficit accumulated during development stage of $8,125,391 of which $1,556,204 was applied to additional paid-in capital upon conversion from an "S" to a "C" corporation) (6,620,721) Less: Treasury stock, 33,789 shares, at cost (1,700) -------------- Total Stockholders' Equity 747,550 -------------- Total Liabilities and Stockholders' Equity $ 1,296,572 ==============
See notes to the condensed interim financial statements. MEDJET INC. (A Development Stage Company) Condensed Interim Statements of Operations For The Three Months Ended March 31, 2000 and 1999 And The Period From December 16, 1993 (Date of Inception), to March 31, 2000 (Unaudited)
Three Months Ended Period from March 31, December 16, ------------------------------ 1993 (Inception) to 2000 1999 March 31, 2000 -------------- ------------- --------------------- Revenues: License fee income $ - $ 120,000 $ 675,000 -------------- ------------- --------------------- Total revenues - 120,000 675,000 -------------- ------------- --------------------- Expenses: Research, development, general and administrative 350,716 340,255 9,668,924 -------------- ------------- --------------------- Total expenses 350,716 340,255 9,668,924 -------------- ------------- --------------------- Loss from Operations (350,716) (220,255) (8,993,924) Other Income (Expense): Net interest income 10,992 2,592 275,574 -------------- ------------- --------------------- Loss Before Income Tax (339,724) (217,663) (8,718,350) Income tax - - (592,959) -------------- ------------- --------------------- Net Loss (339,724) (217,663) (8,125,391) Dividends on Preferred Stock - - 184,923 -------------- ------------- --------------------- Net Loss Attributable to Common Shareholders $ (339,724) $ (217,663) $ (8,310,314) ============== ============= ===================== Net Loss Per Share $ (0.09) $ (0.06) $ (2.61) ============== ============= ===================== Weighted average common shares outstanding 3,901,431 3,881,158 3,189,565 ============== ============= =====================
See notes to the condensed interim financial statements. MEDJET INC. (A Development Stage Company) Condensed Interim Statements of Cash Flows For The Three Months Ended March 31, 2000 and 1999 And The Period From December 16, 1993 (Date of Inception), to March 31, 2000 (Unaudited)
For the Three Months Ended Period from March 31, December 16, ----------------------------------- 1993 (Inception) to 2000 1999 March 31, 2000 ---------------- ---------------- -------------------- Cash Flows from Operating Activities $ (311,266) $ (115,777) $ (7,610,626) Cash Flows from Investing Activities (43,769) (8,486) (753,594) Cash Flows from Financing Activities (50,000) - 9,022,934 ---------------- ---------------- -------------------- Net Increase (Decrease) in Cash and Cash Equivalents (405,035) (124,263) 658,714 Cash and Cash Equivalents - Beginning of Period 1,063,749 343,594 - ---------------- ---------------- -------------------- Cash and Cash Equivalents - End of Period $ 658,714 $ 219,331 $ 658,714 ================ ================ ==================== Supplemental Disclosures of Cash Flow Information: Cash Paid for: Income taxes $ - $ - $ 600 ================ ================ ==================== Interest expense $ 3,811 $ 150 $ 29,296 ================ ================ ====================
See notes to the condensed interim financial statements. 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 three months ended March 31, 2000 are not necessarily indicative of results to be expected for the entire year ending December 31, 2000. NOTE B - NET LOSS PER SHARE: Net loss per share, in accordance with the provisions of Financial Accounting Standards No. 128, "Earnings Per Share," is computed by dividing net loss by the weighted average number of shares of Common Stock outstanding during the period. Common Stock equivalents have not been included in this computation as the effect would be anti-dilutive. NOTE C - LICENSE AGREEMENT: In July 1998, the Company entered into an agreement with Nestle S.A. ("Nestle") granting Nestle and its wholly owned subsidiary, Alcon Laboratories, Inc. ("Alcon"), an exclusive, worldwide license for the use of the Company's proprietary microjet technology for corneal refractive surgery. Under the terms of the agreement, Alcon was to make a best effort to obtain regulatory clearance or approval, manufacture, promote and market certain refractive microjet devices and consumables developed by the Company. Among other things, the agreement provided for future payments based on the attainment of certain milestones, minimum royalty payments starting in the year 2000, royalties upon sales by Alcon of the Company's products and payments to the Company to cover the cost of the transfer to Alcon of the Company's technology, some of which payments were to be credited against future royalties owed to the Company. The Agreement was terminable on three months' notice and, on December 13, 1999, the Company received notice of Alcon's termination of the Agreement. Alcon offered no reason for the termination. 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 "anticipate," "expect," "intend," "management 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 the introduction to Part I of the Company's Annual Report on Form 10-KSB for the fiscal year ended December 31, 1999, 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 for corneal surgery based on microjets. The Company expects, during the remainder of 2000, assuming the appropriate regulatory clearances are obtained, to continue its research and development activities, focusing principally on ophthalmic surgical technology and equipment, and to offer for sale its first microjet microkeratome product. It also expects to commence early exploratory work on dental applications of microjet technology. The Company is a development stage company. RESULTS OF OPERATIONS The Company has not yet initiated sales of its products and, consequently, had no sales revenues during the three months ended March 31, 2000. Total expenses during the three months ended March 31, 2000 increased by $10,461 (3.01%) to $350,716 from $340,255 for the comparable period of 1999. This was primarily due to an increase in legal fees, primarily related to the NJIT litigation (see "Legal Proceedings"), offset in part by staff reductions (to six full-time employees and one part-time employee from nine full-time employees and one part-time employee) as the Company continued to curtail certain operational activities in order to husband and stretch its existing capital. See "Liquidity and Capital Resources" below. Expenses were also higher during the 1999 period due to increased purchases for materials, testing and analysis and other higher costs associated with the higher level of activity. Other income/expense consists of interest income, interest expense and finance charges. Net interest income for the three months ended March 31, 2000 increased by $8,400 to $10,992 from $2,592 for the comparable period of 1999. This increase resulted principally from income earned on the Company's short-term investments, which were higher in the 2000 period, reflecting the funds received through the Company's issuance of preferred stock and the sale of its New Jersey State tax credits. See "Liquidity and Capital Resources" below. LIQUIDITY AND CAPITAL RESOURCES As of March 31, 2000, the Company's working capital was $171,507. Throughout the second half of 1998 and into 1999, the Company sought additional capital to finance its 1999 and 2000 business plans. Pending obtaining additional financing, the Company made the decision to curtail several operational activities as well as to downsize its employee base in order to husband and stretch its existing capital to the next financing. In October and November 1998, the Company dismissed 9 of its 19 employees and also significantly reduced the salary of the management group, in some cases by up to 50%. The specific goal was to reduce the Company's monthly expenditures by 60%, to approximately $100,000. In December 1999, the Company commenced a private placement of its Series B Convertible Preferred Stock at a price of $125 per share. The Preferred is convertible into 100 shares of Common Stock for each share of Preferred, subject to adjustment for any stock splits, stock dividends, recapitalizations, reclassifications and similar events. At the closing for this private placement, held on December 6, 1999, the Company sold and issued 16,000 shares of Preferred for an aggregate price of $2,000,000. In addition, the investors received 1.6 million five-year warrants to purchase Common Stock, each at an exercise price of $3.50 per share. The Company also entered into an investment banking agreement with a New York firm affiliated with certain of the investors, and issued the firm 500,000 warrants with the same terms. On January 28, 2000, the Company returned $700,000 of the $2,000,000 aggregate price received from the sale of the Series B Preferred. It was the Company's understanding that the original investment was made based, in part, on the Company's Agreement with Alcon which, as previously mentioned in this report, was unexpectedly terminated by Alcon on December 13, 1999. In light of the termination of the Agreement soon after the Series B Preferred closing, the Company and the investors reevaluated the assumptions on which the original investment was made and determined that the return of a portion of the original investment would resolve any possible disputes arising from the termination. The return of funds was made pursuant to an agreement, dated January 28, 2000, under which the Company received a return of a proportionate number of the Series B Preferred and Series B Warrants issued in the private placement. In connection with this agreement, the investment banking agreement entered into by the Company at the time of the original investment also was cancelled. In January 1998, the State of New Jersey enacted legislation allowing emerging technology and/or biotechnology companies to sell their unused New Jersey Net Operating Loss ("NOL") Carryover and Research and Development Tax Credits ("R&D Credits") to corporate taxpayers in New Jersey. During 1999, the Company entered into an agreement under which it retained a third party broker to identify a buyer for the Company's NOL Carryover and R&D Credits. The total anticipated net proceeds of this transaction ($594,209) were recorded as a non-current deferred tax asset in the accompanying financial statements. Due to limitations placed by the State of New Jersey on the total amount of NOL Carryover and R&D Credits eligible to be sold in any one year, the sale of only a portion of the Company's NOL Carryover and R&D Credits ($327,000) was completed in 1999. The receipt of these funds, on December 16, 1999, was recorded as a reduction to the non-current deferred tax asset in the accompanying financial statements. The sale of the remaining balance of the Company's NOL Carryover and R&D Credits is anticipated by the end of the third quarter of 2000. There can be no assurances, however, that this proposed sale will occur. To the extent that the NOL Carryover and R&D Credits are sold, they will be unavailable to the Company to offset future New Jersey state taxes. During March 1999, Dr. Gordon agreed to make available to the Company a 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 Common Stock and agreed to pay a market interest rate on amounts borrowed. During 1999, amounts advanced under this agreement totaled $250,000. At December 31, 1999, $100,000 of this amount, plus accrued interest, had been repaid. The Company anticipates that its cash on hand, plus the loan available from Dr. Gordon and the sale of its New Jersey State NOL Carryover and R&D Credits, will be sufficient to meet the Company's 2000 working capital and planned capital expenditure requirements. If, however, the Company incurs unexpected expenses, or if the remaining New Jersey NOL Carryover and R&D Credits are not sold as anticipated, the Company may require additional financing prior to the end of 2000 in order to maintain its current operations. The Company currently has no commitment or arrangement for any capital, and there can be no assurance whether or on what terms it will be able to obtain any needed capital. If additional financing is not available, the Company would be materially adversely affected and be required to further curtail or cease altogether its current operations. During 2000, the Company intends to seek additional funding in order to accelerate its product development efforts and augment its working capital. 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 have been limited to constructing and testing experimental versions of microkeratomes for eye surgery and conducting a limited number of feasibility studies using enuleated porcine, rabbit and human cadaver eyes and live rabbits to prove that the beam of water can smoothly incise and shape the anterior surface of the cornea and that the cornea will heal properly after the surgery. Human blind eye trials are anticipated to begin in the third quarter of 2000. Assuming success in these trials, the Company plans to introduce a microkeratome product later this year. The Company is currently in discussions regarding a contract to supply, for non-ophthalmic uses on an OEM basis, its Hydrobrush(TM) Keratome, which was cleared for marketing by the U.S. Food and Drug Administration ("FDA") in 1998. In July 1998, the Company entered into an agreement with Nestle S.A. ("Nestle") pursuant to which the Company granted Nestle and its wholly owned subsidiary, Alcon Laboratories, Inc. ("Alcon"), an exclusive, worldwide license for the use of the Company's proprietary microjet technology for corneal refractive surgery. Under the terms of the license agreement ("Agreement"), Alcon was to make a best effort to register, manufacture, promote and market refractive microjet devices and consumables developed by the Company. Among other things, the Agreement provided for future payments based on the attainment of certain milestones, minimum royalty payments starting in the year 2000, royalties upon sales by Alcon of the Company's products and payments to the Company to cover the cost of the transfer to Alcon of the Company's technology, some of which payments were to be credited against future royalties owed to the Company. The Agreement was terminable on three months' notice and, on December 13, 1999, the Company received notice of Alcon's termination of the Agreement. Alcon offered no reason for the termination. The Company had budgeted a minimum annual royalty payment from Nestle of $500,000 for the year 2000. Since Nestle has advised the Company that, based on its interpretation of the Agreement, no royalty is due, the Company plans to seek legal recourse against Nestle. The Company currently is assessing its plans for ophthalmologic applications for its microjet technology in light of the termination of the Alcon agreement. Although the Company currently intends to undertake the manufacture and marketing of its microjet products on a limited scale, it continues to have discussions with several potential strategic partners and is investigating other possible arrangements for larger-scale manufacturing, marketing and distribution. These discussions are in the early stages, and no formal understanding or agreement has been reached with any potential strategic partner. The Company's objective in entering into any such arrangements would be to obtain adequate funding to support development of other products, in addition to their manufacture, promotion and marketing. In such event, 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, which information is incorporated herein by reference. The Company has filed a patent application and is evaluating the potential use of water jets for treatment of dental caries. Initial feasibility tests have been promising and the Company believes this development program may yield a product with significant market potential. The Company's dependence on third parties for the manufacture of its products 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 Company does not enter into license or distribution arrangements with respect to its products, it may undertake the marketing and sale of its own products. In such event, the Company intends to market and sell its products 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 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. OTHER MATTERS The Year 2000 problem has not to date had a material impact on the Company's operations, and the Company believes that the Year 2000 problem will not have a significant impact on the Company's future operations. Costs incurred to insure that the Company's systems are Year 2000 compliant have to date not been, and are not expected to be, material to the Company's results of operations, financial position or cash flows, and no Year 2000 problems have been encountered by the Company's systems to date. PART II - OTHER INFORMATION Item 1. LEGAL PROCEEDINGS New Jersey Institute of Technology On April 21, 1998, the Company was served with a complaint by the New Jersey Institute of Technology ("NJIT") commencing a lawsuit in the United States District Court for the District of New Jersey ("U.S. District Court"). Each of the Company, Eugene I. Gordon, Ph.D. (the Company's Chairman and Chief Executive Officer), a former employee of the Company, certain patent law firms and an individual patent attorney were named as defendants. The complaint alleged that the defendants, with deceptive intent, failed to name an NJIT professor and/or NJIT research associate as a co-inventor on the Company's U.S. Patent No. 5,556,406 on the "Lamellar Surgical Device and Procedure" (the "Patent") and breached fiduciary duties and contractual obligations owed to NJIT. The complaint sought monetary damages from the Company and an order directing that the Company's Patent (and corresponding foreign patents and patent applications) be assigned and transferred to NJIT. It further sought an order that NJIT has not infringed any claims of such Patent and a declaratory judgment that all of the Company's claims under such Patent are invalid and unenforceable against NJIT. NJIT had submitted a patent application relating to a different refractive corrective procedure based on the use of an isotonic water jet to the U.S. Patent and Trademark Office. That patent and a related divisional patent have recently issued. The three inventors of the subject of such patent application, one of which was Dr. Gordon, had assigned such patent application to NJIT as part of a dispute settlement in which NJIT agreed to grant an exclusive license to the Company of the patent rights under such patent application. That license was terminated by the Company based on its evaluation of the patent potential. In its U.S. District Court pleas, NJIT claims that the Company's Patent emanates from the earlier invention. Prior to being served with the complaint by NJIT, the Company and Dr. Gordon filed a complaint, on March 27, 1998, against NJIT in the Superior Court of the State of New Jersey, Middlesex County ("State Court"), seeking a declaratory judgment that NJIT had no ownership or other interest in the rights to the Company's Patent and seeking payment for damages. NJIT removed the Company's lawsuit to the U.S. District Court, seeking to have it consolidated with its lawsuit. The Company moved to have its suit remanded to the State Court and to have the NJIT lawsuit dismissed on the grounds that the federal court lacked jurisdiction over either action. During October 1998, the lawsuit brought in U.S. District Court by NJIT was dismissed on jurisdictional grounds. In addition, the U.S. District Court also held that NJIT improperly removed the Company's state court action and ordered that action remanded to the state court. NJIT appealed the remand action and appealed the dismissal of its lawsuit brought in U.S. District Court. These appeals have been dismissed. On April 26, 1999, NJIT commenced a second action in U.S. District Court. NJIT alleged that the defendants failed to name a NJIT professor and/or a NJIT research associate as co-inventors of the Patent and breached fiduciary duties and contractual obligations owed to NJIT. As in the first federal court action, NJIT sought monetary damages, an order directing that the Company's Patent, foreign patents and patent applications be assigned and transferred to NJIT, a declaratory judgment that all of the claims of the Company's Patent are invalid and unenforceable against NJIT and an order amending the named inventors of the Company's Patent to include the NJIT professor and/or the NJIT research associate. Briefing to the federal court on the motion to dismiss the action against the Company, Dr. Gordon and the former employee of the Company is complete. No date for a ruling has been set. With respect to the Company's lawsuit against NJIT, NJIT has asserted similar counterclaims and/or third party claims against each of the Company, Dr. Gordon, a former patent attorney for the Company, a former employee of the Company and certain patent law firms. A Summary Judgement in favor of the law firms has already issued. The discovery phase has now been completed. Based on the evidence, the Company is virtually certain that it's Patent is valid and enforceable and that the Company has substantial and valid defenses to each of NJIT's counterclaims. The Company has recently filed a Motion for Summary Judgement on the basis that NJIT has presented absolutely no evidence or testimony that support its claims. A hearing has been scheduled during May 2000. The Company believes that an unfavorable outcome is highly unlikely, and therefore no amounts have been accrued with respect to this lawsuit. Other On April 16, 1999, the Company was served with a complaint commencing a lawsuit in the United States District Court for the District of New Jersey by Robert G. Donovan, a former officer and director, seeking payment of $129,500 for services alleged to have been performed by Mr. Donovan as a temporary Co-President for the Company. A compensation package approved by the Company's Board of Directors and offered by the Company previously had been rejected by Mr. Donovan. Since Mr. Donovan has so far been unable to name or document services performed for the Company as Co-President, the Company believes the probability of a significant unfavorable outcome is remote. This matter is currently in the preliminary stages and no prediction can be made of the ultimate outcome. Item 2. CHANGES IN SECURITIES AND USE OF PROCEEDS None Item 3. DEFAULTS UPON SENIOR SECURITIES None Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS None Item 5. OTHER INFORMATION None Item 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits 11 Statement regarding computation of per share earnings 27 Financial Data Schedule (b) Reports on Form 8-K None 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: May 11, 2000 MEDJET INC. /s/ Eugene I. Gordon --------------------------- Eugene I. Gordon, Ph.D. Chairman of the Board and Chief Executive Officer /s/ Thomas M. Handschiegel --------------------------- Thomas M. Handschiegel Vice President - Finance and Human Resources (Principal financial and accounting officer) INDEX TO EXHIBITS EXHIBIT NO. DESCRIPTION 11 Statement regarding computation of per share earnings 27 Financial Data Schedule EX-11 2 COMPUTATION OF PER SHARE EARNINGS Exhibit 11 COMPUTATION OF NET LOSS PER SHARE
Three Months Ended March 31, ---------------------------- 2000 1999 ---- ---- NET LOSS PER SHARE Loss from Operations applicable to Common Stock $ (339,724) $ (217,663) Weighted Average Common Shares Outstanding 3,901,431 3,881,158 ----------- ----------- Net Loss Per Share $ (0.09) $ (0.06) =========== =========== NET LOSS PER SHARE - ASSUMING DILUTION Loss from Operations applicable to Common Stock $ (339,724) $ (217,663) =========== =========== Weighted Average Common Shares Outstanding 3,901,431 3,881,158 Add: (A) Assumed Conversion of Preferred Stock 1,040,000 - (B) Assumed Exercise of Stock Options 53,089 3,812 (C) Assumed Exercise of Warrants 9,016 - Weighted Average Common Shares ----------- ----------- Outstanding - Assuming Dilution 5,003,536 3,884,970 =========== =========== Net Loss Per Share - Assuming Dilution $ (0.07) $ (0.06) =========== ===========
NOTE: The calculation for Net Loss Per Common Share - Assuming Dilution is submitted in accordance with Securities Exchange Act of 1934 Release No. 9083 although not required by Financial Accounting Standards Board No. 128 "Earnings Per Share" ("FASB 128") since the results are anti-dilutive. (A) - For the dilutive options (i.e., the average market price is greater than the exercise price), assume that options are exercised and proceeds realized as indicated below. Next, using the treasury stock method with the average market price per share during each period and the total shares assumed to be reacquired as of the beginning of each period, the additional shares included as outstanding are indicated below.
Three Months Ended March 31, ---------------------------- 2000 1999 ---- ---- Options assumed exercised 207,550 97,050 Proceeds assumed realized $188,443 $95,103 Shares assumed reacquired: - During 2000 ($188,443/$1.22) 154,461 - During 1999 ($95,103/$1.02) 93,238 Net additional shares assumed outstanding 53,089 3,812
(B) - For the dilutive warrants (i.e., the average market price is greater than the exercise price), assume that warrants are exercised and proceeds realized as indicated below. Next, using the treasury stock method with the average market price per share during each period and the total shares assumed to be reacquired as of the beginning of each period, the additional shares included as outstanding are indicated below.
Three Months Ended March 31, ---------------------------- 2000 1999 ---- ---- Warrants assumed exercised 50,000 - Proceeds assumed realized $50,000 - Shares assumed reacquired: - During 2000 ($50,000/$1.22) 43,931 - During 1999 ($-0-/$1.02) - Net additional shares assumed outstanding 9,016 -
EX-27 3 FINANCIAL DATA SCHEDULE
5 This schedule contains summary financial information extracted from the March 31, 2000 (unaudited) financial statements of Medjet Inc. and is qualified in its entirety by reference to such financial statements. 3-MOS DEC-31-2000 JAN-01-2000 MAR-31-2000 658,714 0 0 0 0 720,529 435,246 334,915 1,296,572 549,022 0 0 104 3,935 110,908 1,296,572 0 0 0 0 350,716 0 3,288 (339,724) 0 (339,724) 0 0 0 (339,724) (.09) (.07)
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