-----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, QrAbtuJikrQ2m6XdN2qxxbFHVhIx5MLDjiWNu0+3HAM2GEbSzglJazxPxcrE78jb x24h4tpE8lcrWSnzXCofgQ== 0000914317-04-002921.txt : 20040730 0000914317-04-002921.hdr.sgml : 20040730 20040730165203 ACCESSION NUMBER: 0000914317-04-002921 CONFORMED SUBMISSION TYPE: S-3 PUBLIC DOCUMENT COUNT: 13 FILED AS OF DATE: 20040730 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MEDISCIENCE TECHNOLOGY CORP CENTRAL INDEX KEY: 0000064647 STANDARD INDUSTRIAL CLASSIFICATION: SURGICAL & MEDICAL INSTRUMENTS & APPARATUS [3841] IRS NUMBER: 221937826 STATE OF INCORPORATION: NJ FISCAL YEAR END: 0228 FILING VALUES: FORM TYPE: S-3 SEC ACT: 1933 Act SEC FILE NUMBER: 333-117820 FILM NUMBER: 04942835 BUSINESS ADDRESS: STREET 1: 1235 FOLKESTONE WY CITY: CHERRY HILL STATE: NJ ZIP: 08034 BUSINESS PHONE: 6094287952 MAIL ADDRESS: STREET 1: 1235 FOLKESTONE WAY CITY: CHERRY HILL STATE: NJ ZIP: 08034 FORMER COMPANY: FORMER CONFORMED NAME: CARDIAC TECHNIQUES INC DATE OF NAME CHANGE: 19730920 S-3 1 s3-61479_medscience.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 ____________________________ FORM S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ____________________________ MEDISCIENCE TECHNOLOGY CORP. (Exact Name of Registrant as Specified in Its Charter) New Jersey 22-1937826 (State or Other Jurisdiction of (I.R.S. Employer Incorporation or Organization) Identification Number) 1235 Folkestone Way Cherry Hill, New Jersey 08034 Telephone: (856) 428-7952 (Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant's Principal Executive Offices) ____________________________ Peter Katevatis Chairman and Chief Executive Officer Mediscience Technology Corp. 1235 Folkestone Way Cherry Hill, New Jersey 08034 Telephone: (856) 428-7952 (Name, Address Including Zip Code, and Telephone Number, Including Area Code, of Agent for Service) Copy to: Peter B. Hirshfield, Esq. Olshan Grundman Frome Rosenzweig & Wolosky LLP 65 East 55th Street New York, NY 10022 (212) 451-2300 ____________________________ As soon as practicable after the effective date of this registration statement (Approximate Date of Commencement of Proposed Sale to the Public) If the only securities being registered on the Form are being offered pursuant to dividend or interest plans, check the following box.[_] 1 If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered in connection with dividend or interest reinvestment plans check the following box.[X] If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) 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 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, check the following box.[_] CALCULATION OF REGISTRATION FEE
- ------------------------------------------------------------------------------------------------- Title of Each Class of Amount to be Proposed Proposed Maximum Amount of Securities to be Registered Maximum Price Aggregate Offering Registration Registered Per Price Fee Share - ------------------------------------------------------------------------------------------------- Common Stock, par value 8,075,000 $0.50 $4,037,500 $511.55 $0.01 per share - -------------------------------------------------------------------------------------------------
Pursuant to Rule 416 of the Securities Act, the shares of common stock offered hereby also include an indeterminate number of additional shares of common stock as may from time to time become issuable by reason of stock splits, stock dividends or other similar transactions. (1) Estimated solely at $0.50 per share the last sales price of our Common Stock as reported on the NASDAQ BB Market for July 28, 2004, for the purpose of calculating the registration fee in accordance with Rule 457 under the Securities Act. (2) We are registering an aggregate of 8,075,000 shares of our common stock, $0.01 par value per share ("Common Stock"), which includes (i) an aggregate of 6,000,000 shares of Common Stock that were issued upon the conversion of 60 shares of our Series A Preferred Stock, (ii) an aggregate of 1,925,000 shares of Common Stock that were issued to consultants, and (iii) an aggregate of 150,000 shares of Common Stock that were issued upon the exercise of warrants. All of such shares of Common Stock are being offered for resale by such common shareholders (the "Selling Shareholders"). WE HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL WE 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 THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE. The information in this prospectus is not complete and may be changed. The Selling Shareholders may not sell these securities (except pursuant to a transaction exempt from the registration requirements of the Securities Act) until the Registration Statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. Subject to completion, dated August ____, 2004 2 PROSPECTUS MEDISCIENCE TECHNOLOGY CORP. 8,075,000 Shares of Common Stock This prospectus relates to the sale by the Selling Shareholders identified in this prospectus of up to an aggregate of 8,075,000 shares of our common stock, $0.01 par value per share ("Common Stock"), which includes (i) an aggregate of 6,000,000 shares of Common Stock that were issued upon the conversion of 60 shares of our Series A Preferred Stock, (ii) an aggregate of 1,925,000 shares of Common Stock that were issued to consultants, and (iii) an aggregate of 150,000 shares of Common Stock issued upon the exercise of warrants with an exercise price of $0.25 per share. We will not receive any of the proceeds from the sale of these shares by the Selling Shareholders. However, we received an aggregate of $37,500 from the exercise of warrants to purchase 150,000 shares to be sold hereunder. See "Use of Proceeds." We will bear all costs relating to the registration of the shares. All of such shares of Common Stock are being offered for resale by the Selling Shareholders. Our Common Stock is traded on the NASDAQ BB Market under the symbol "MDSC." The last sales price of our Common Stock on July 28, 2004 as reported by NASDAQ BB was $0.50 per share. Investing in our Common Stock involves a high degree of risk. You should read this entire prospectus carefully, including the section entitled "Risk Factors" beginning on page 7 which describes certain material risk factors you should consider before investing. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES, OR DETERMINED WHETHER THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. The date of this prospectus is August__, 2004 3 TABLE OF CONTENTS Page PROSPECTUS SUMMARY...........................................................4 FORWARD LOOKING STATEMENTS...................................................7 RISK FACTORS.................................................................7 USE OF PROCEEDS..............................................................16 DESCRIPTION OF THE TRANSACTIONS..............................................16 SELLING SHAREHOLDERS.........................................................17 DESCRIPTION OF SECURITIES....................................................20 PLAN OF DISTRIBUTION.........................................................22 INDEMNIFICATION OF OFFICERS AND DIRECTORS....................................23 WHERE YOU CAN FIND MORE INFORMATION ABOUT US.................................24 INCORPORATION OF CERTAIN INFORMATION BY REFERENCE............................24 LEGAL MATTERS................................................................25 EXPERTS......................................................................25 You should rely only on the information contained in this prospectus. We have not authorized anyone to provide you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. We are not making an offer to sell these securities in any jurisdiction where an offer or sale is not permitted. You should assume that the information appearing in this prospectus is accurate as of the date on the front cover of this prospectus only, regardless of the time of delivery of this prospectus or of any sale of our Common Stock. Our business, financial condition, results of operations and prospects may have changed since that date. PROSPECTUS SUMMARY The following summary highlights aspects of the offering and the information incorporated by reference in this prospectus. This prospectus does not contain all of the information that may be important to you. You should read this entire prospectus carefully, including the "Risk Factors" section and the financial statements, related notes and the other more detailed information appearing elsewhere or incorporated by reference in this prospectus before making an investment decision. Unless otherwise indicated, "we", "us", "our" and similar terms, as well as references to the "Company" and "Registrant", refer to Mediscience Technology Corp. and its wholly owned subsidiaries and not to the Selling Shareholders. 4 Company Background The Company is principally engaged in the design and development of medical diagnostic instruments that detect cancer in vivo in humans by using light to excite the molecules contained in tissue and measuring the differences in the resulting natural fluorescence between cancerous and normal tissue. On December 1, 1988, we acquired all the outstanding stock of Laser Diagnostic Instruments, Inc. ("LDI"), which is now a wholly owned subsidiary of the Company. The principal asset of LDI was the ownership of a U.S. patent application entitled "Method and Apparatus for Detecting Cancerous Tissue Using Visible Luminescence," which patent was subsequently granted in 1990 and 1998, and expanded from 9 to 59 claims in a re-examination of that patent. Our research and development activities are centered in and around this patent and other patents either acquired subsequently from The Research Foundation of City University of New York ("RFCUNY") by us or for which we are the exclusive licensee from RFCUNY. On February 5, 2003 we acquired two exclusive world-wide licenses for US patent applications filed by RFCUNY: "Stokes-Shift Fluorescence Spectroscopy for Detection of Disease and Physiological State of Specimen" and "Three-Dimensional Radiative Transfer Tomography for Turbid Media" which when issued, would extend our core technology in the optical biopsy field. Our claim of priority right runs for a twenty year period from February 5, 2003, thus providing our core technology patent protection for that period. We have successfully conducted preclinical and clinical evaluations which continue to support our belief that our proprietary technology, when fully developed, will be useful in the screening and diagnosis of cancer. We also believe that our technology, if successfully developed, will have substantial commercial appeal due to its non-invasive character, its delivery of immediate, real time results, its enhanced diagnostic sensitivity and specificity and its appeal to physicians who can generate additional office revenues that currently accrue to an off site pathology laboratory. On January 6, 1997, we received approval from the FDA of our Investigational Device Exemption application to initiate human Phase II clinical trials with our CD Scan medical device for early stage detection of cancer. This trial has not been initiated at that time because of the lack of funding. On January 25, 1999 the FDA classified our RFCD Scan medical device as a non-significant risk device for human trial Phase I clinical investigation of the biological basis of fluorescence as applied to medically significant female OBGYN health issues. This pilot study is being conducted under a research agreement with Yale University and RFCUNY. On December 11, 2003 the FDA, after audit review, qualified us as a small entity allowing reduced or waived FDA fees for our 2004 medical device 510k or other market approval submissions and our participation in expedited FDA review through FDA clinical inspections conducted independently by third party FDA approved "accredited" persons, directly employed by us. Strategy Our strategy is to commercialize early cancer detection devices based upon our developed technology, completed prototypes and expertise in the area of fluorescent imaging. In addition to acquiring and seeking additional conventional direct investment we may also use an organizational structure of wholly owned subsidiary limited liability companies, each with its 5 own intellectual property supported application, in order to select and prioritize targeted diagnostic indications to maximize the return on development and clinical investments and the value of our intellectual property. To that end, we formed Photonics for Woman's Oncology LLC on February 27, 2003 and Pro-screen, LLC on June 3, 2003 in Delaware and Medi-Photonics Development LLC ("Medi-Phonotics") on February 19, 2004 in New York, as wholly owned subsidiaries. Medi-Photonics will be used for commercialization in the area of early cervical cancer detection and is presently adequately funded, possesses a working prototype, a project agreement with RFCUNY, has established a management team and is completing its plan in an effort to secure a 510k exemption from the FDA. We are also working on early cancer detection devices in the areas of prostate, colon, esophagus, and skin cancer and are encouraged by all results. We are in various stages of business development activity with potential distributors, strategic partners, and other strategic investors. We believe that our technology will be broadly applicable in cancer screening and diagnosis. We are preparing to submit an application for 510k exemption, however presently, each approved labeled indication requires separate pre-marketing approval (a "PMA"), which is a time-consuming and costly process. We regard our "516" and other related patents as pioneering, blocking and dominant in the area of cancer diagnosis using fluorescence spectroscopy both in-vivo and in-vitro. We continue to seek additional funding through present and new equity capital from institutional and individual professional investor groups. In such cases where the LLC structure may serve as a separate investment vehicle we intend to license the requisite platform technologies to, and assign, as capital contribution, other critical assets for majority and substantial equity ownership in, and an upfront license fee from, that LLC. We currently anticipate that the licenses issued to an LLC will be exclusive, royalty-bearing, irrevocable, perpetual, sub-licensable, worldwide licenses to manufacture, modify, use, market, sell and distribute the platform technologies as part of or in connection with a product, process, or machine for use in the niche markets identified by and granted to such LLC. We currently intend to enter into management and corporate services agreements with that LLC to provide certain administrative and management services for a management fee and will continue to act as an intellectual property transfer and research agent between any such LLC and RFCUNY. We have no revenues from current operations and are funding the development of our products through the sale of our securities and will continue to require financial resources to maintain business momentum and to leverage intellectual property assets through FDA clinicals/approvals into the market place as products. In the absence of the availability of such financing on a timely basis, the Company could be forced to materially curtail, limit or cease its operations. Because of our significant recurring losses, and the lack of certain sources of capital to fund our operations, our independent registered public accounting firm as stated in their report for the fiscal years ended February 29, 2004, February 28, 2003 and February 28, 2002, included an explanatory paragraph indicating that substantial doubt exists about our ability to continue as a going concern. Our principal offices are located at 101 East 31st Street, New York, New York 10022, and 1235 Folkestone Way, Cherry Hill, New Jersey 08034. 6 The Offering Common Stock Offered by Selling Shareholders 8,075,000 Use of Proceeds We will not receive any proceeds from the sale of shares in this offering. We received $37,500 from the exercise of warrants to purchase shares to be sold hereunder. NASDAQ BB Symbol MDSC Common Stock Outstanding After Offering 50,964,703 shares, based on 50,964,703 shares outstanding as of June 30, 2004 and excluding shares that, as of the date of this prospectus, are issuable upon the exercise of options, with exercise prices ranging from $0.25 to $1.50 per share, and certain anti-dilutive contractual provisions. FORWARD-LOOKING STATEMENTS This prospectus, including the documents that we incorporate by reference, contains forward-looking statements (as defined in Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934 (the "Exchange Act"). To the extent that any statements made in this prospectus contain information that is not historical, these statements are essentially forward-looking. Forward-looking statements can be identified by the use of words such as "experts," "plans" "will," "may," "anticipates," believes," "should," "intends," "estimates," and other words of similar meaning. These statements are subject to risks and uncertainties that cannot be predicted or quantified and consequently, actual results may differ materially from those expressed or implied by such forward-looking statements. Such risks and uncertainties include, without limitation, our ability to raise capital to finance the development of our products, the effectiveness, profitability and the marketability of those products, our ability to protect our proprietary information, general economic and business conditions, the impact of technological developments and competition, our expectations and estimates concerning future financial performance and financing plans, our ability to successfully integrate the businesses of our three subsidiaries, the impact of current, pending or future legislation and regulation on the healthcare industry and other risks detailed from time to time in our filings with the Securities and Exchange Commission ("SEC"). We do not undertake any obligation to publicly update any forward-looking statements. As a result, you should not place undue reliance on these forward-looking statements. 7 RISK FACTORS The following risk factors should be considered carefully in addition to the other information presented herein: WE DO NOT HAVE A LONG OPERATING HISTORY, WHICH MAKES IT DIFFICULT TO EVALUATE OUR BUSINESS. Because limited financial data is available on our operations and products, it may be difficult for you to evaluate our business. Our prospects must be considered in light of the substantial risks, expenses, uncertainties and difficulties encountered by entrants into the medical device industry, which is characterized by increasing intense competition and a high failure rate. WE HAVE A HISTORY OF LOSSES, AND WE EXPECT LOSSES TO CONTINUE. We have never been profitable, and we have had operating losses since our inception. We expect our operating losses to continue as we continue to expend substantial resources to further develop and commercialize our products, obtain regulatory clearances or approvals, build our marketing, sales, manufacturing and finance organizations, and conduct further research and development. To date, we have engaged primarily in research and development efforts. The further development and commercialization of our products will require substantial development, regulatory, sales and marketing, manufacturing and other expenditures. IF WE CANNOT OBTAIN ADDITIONAL FUNDS WHEN NEEDED, WE WILL NOT BE ABLE TO IMPLEMENT OUR BUSINESS PLAN. We will require substantial additional capital to develop our products, including completing product testing and clinical trials, obtaining all required regulatory approvals and clearances, beginning and scaling up manufacturing, and marketing our products. We have historically funded a significant portion of our activities through private placements. We are seeking a collaborative partner for our technology and are seeking targeted funding for our cervical cancer program. Any failure to find collaborative partners to fund our capital expenditures, or our inability to obtain capital through other sources, would limit our ability to grow and operate as planned. Even if we do enter into an agreement with a collaborative partner, the obligations of a collaborative partner to fund our expenditures is largely discretionary and depends on a number of factors, including our ability to meet specified milestones in the development and testing of the relevant product. We may not be able to meet these milestones, or our collaborative partner may not continue to fund our expenditures. We bear responsibility for all aspects of our product line and our cervical cancer product, which are not being developed with a collaborative partner. We will be required to raise additional funds through public or private financing, additional collaborative relationships or other arrangements. We believe that our existing capital resources will not be sufficient to fund our operations to the point of commercial introduction of our monitoring products and our cervical cancer detection product. Any failure to achieve adequate funding in a timely fashion would delay our development programs and could lead to abandonment of one or more of our development initiatives. Any required additional funding may not be available on terms attractive to us, or at all. To the extent we cannot obtain additional funding, our ability to continue to develop and introduce products to market will be limited. Any additional equity financing may be dilutive to shareholders, and debt financing, if available, may involve restrictive covenants that would limit how we conduct our business or finance our operations. 8 IF WE CANNOT OBTAIN ADDITIONAL FUNDS WHEN NEEDED, OR ACHIEVE PROFITABILITY WE MAY NOT BE ABLE TO CONTINUE AS A GOING CONCERN. Our independent registered public accounting firm has included an explanatory paragraph in their audit report referring to our recurring operating losses and a substantial doubt about our ability to continue as a going concern. Absent additional funding from private or public equity or debt financings, collaborative or other partnering arrangements, or other sources and if we do not secure additional funding, we will be unable to conduct all of our product development efforts as planned, and we may need to cease operations or sell assets. In addition, the existence of the explanatory paragraph in the audit report may in and of itself cause our stock price to decline as certain investors may be restricted or precluded from investing in companies that have received this notice in an audit report. OUR ABILITY TO SELL OUR PRODUCTS IS CONTROLLED BY GOVERNMENT REGULATIONS, AND WE MAY NOT BE ABLE TO OBTAIN ANY NECESSARY CLEARANCES OR APPROVALS. The design, manufacturing, labeling, distribution and marketing of medical device products are subject to extensive and rigorous government regulation, which can be expensive and uncertain and can cause lengthy delays before we can begin selling our products, if at all. IN THE UNITED STATES, THE FOOD AND DRUG ADMINISTRATION'S ACTIONS COULD DELAY OR PREVENT OUR ABILITY TO SELL OUR PRODUCTS, WHICH WOULD ADVERSELY AFFECT OUR GROWTH AND STRATEGY PLANS. In order for us to market our products in the United States, we must obtain clearance or approval from the Food and Drug Administration, or FDA. We cannot be sure that we or any collaborative partners will make timely filings with the FDA; that the FDA will act favorably or quickly on these submissions; that we will not be required to submit additional information or perform additional clinical studies; that we would not be required to submit an application for premarket approval, rather than a 510(k) pre-market notification submission as described below; or that other significant difficulties and costs will not be encountered to obtain FDA clearance or approval. The pre-market approval process is more rigorous and lengthier than the 510(k) clearance process for pre-market notifications; it can take several years from initial filing and require the submission of extensive supporting data and clinical information and clinical study data. The FDA may impose strict labeling or other requirements as a condition of its clearance or approval, any of which could limit our ability to market our products. Further, if we wish to modify a product after FDA clearance of a pre-market notification or approval of a pre-market approval application, including changes in indications or other modifications that could affect safety and efficacy, additional clearances or approvals will be required from the FDA. Any request by the FDA for additional data, or any requirement by the FDA that we conduct additional clinical studies or submit to the more rigorous and lengthier pre-market approval process, could result in a significant delay in bringing our products to market and substantial additional research and other expenditures. Similarly, any labeling or other conditions or restrictions imposed by the FDA on the marketing of our products could hinder our ability to effectively market our products. Any of the above actions by the FDA could delay or prevent altogether our ability to market and distribute our products. Further, there may be new FDA policies or changes in FDA policies that could be adverse to us. 9 IN FOREIGN COUNTRIES, INCLUDING EUROPEAN COUNTRIES, WE ARE ALSO SUBJECT TO GOVERNMENT REGULATION, WHICH COULD DELAY OR PREVENT OUR ABILITY TO SELL OUR PRODUCTS IN THOSE JURISDICTIONS. In order for us to market our products in Europe and some other international jurisdictions, we and our distributors and agents must obtain required regulatory registrations or approvals. We must also comply with extensive regulations regarding safety, efficacy and quality in those jurisdictions. We may not be able to obtain the required regulatory registrations or approvals, or we may be required to incur significant costs in obtaining or maintaining any regulatory registrations or approvals we receive. Delays in obtaining any registrations or approvals required to market our products, failure to receive these registrations or approvals, or future loss of previously obtained registrations or approvals would limit our ability to sell our products internationally. For example, international regulatory bodies have adopted various regulations governing product standards, packaging requirements, labeling requirements, import restrictions, tariff regulations, duties and tax requirements. These regulations vary from country to country. In order to sell our products in Europe, we must maintain ISO 9001 certification and CE mark certification, which is an international symbol of quality and compliance with applicable European medical device directives. Failure to receive or maintain ISO 9001 certification or CE mark certification or other international regulatory approvals would prevent us from selling in Europe. EVEN IF WE OBTAIN CLEARANCE OR APPROVAL TO SELL OUR PRODUCTS, WE ARE SUBJECT TO ONGOING REQUIREMENTS AND INSPECTIONS THAT COULD LEAD TO THE RESTRICTION, SUSPENSION OR REVOCATION OF OUR CLEARANCE. We, as well as any collaborative partners, will be required to adhere to applicable FDA regulations regarding good manufacturing practice, which include testing, control, and documentation requirements. We are subject to similar regulations in foreign countries. Ongoing compliance with good manufacturing practice and other applicable regulatory requirements will be strictly enforced in the United States through periodic inspections by state and federal agencies, including the FDA, and in international jurisdictions by comparable agencies. Failure to comply with these regulatory requirements could result in, among other things, warning letters, fines, injunctions, civil penalties, recall or seizure of products, total or partial suspension of production, failure to obtain premarket clearance or premarket approval for devices, withdrawal of approvals previously obtained, and criminal prosecution. The restriction, suspension or revocation of regulatory approvals or any other failure to comply with regulatory requirements would limit our ability to operate and could increase our costs. OUR SUCCESS LARGELY DEPENDS ON OUR ABILITY TO OBTAIN AND PROTECT THE PROPRIETARY INFORMATION ON WHICH WE BASE OUR PRODUCTS. Our success depends in large part upon our ability to establish and maintain the proprietary nature of our technology through the patent process, as well as our ability to possibly license from others patents and patent applications necessary to develop products. If any of our patents are successfully challenged, invalidated or circumvented, or our right or ability to manufacture our products were to be limited, our ability to continue to manufacture and market our products could be adversely affected. In addition to patents, we rely on trade secrets and proprietary know-how, which we seek to protect, in part, through confidentiality and proprietary information agreements. The other parties to these agreements may breach these provisions, and we may not have adequate remedies for any breach. Additionally, our trade secrets could otherwise become known to or be independently developed by competitors. 10 We have been issued, or have rights to, 25 U.S. patents (including those under license). In addition, we have filed for, or have rights to, 2 U.S. patents (including those under license, one filed under EU treaty provisions) that are still pending. One or more of the patents we hold directly or license from third parties, may be successfully challenged, invalidated or circumvented, or we may otherwise be unable to rely on these patents. These risks are also present for the process we use or will use for manufacturing our products. In addition, our competitors, many of whom have substantial resources and have made substantial investments in competing technologies, may apply for and obtain patents that prevent, limit or interfere with our ability to make, use and sell our products, either in the United States or in international markets. The medical device industry has been characterized by extensive litigation regarding patents and other intellectual property rights. In addition, the United States Patent and Trademark Office may institute interference proceedings. The defense and prosecution of intellectual property suits, Patent and Trademark Office proceedings and related legal and administrative proceedings are both costly and time consuming. Moreover, we may need to litigate to enforce our patents, to protect our trade secrets or know-how, or to determine the enforceability, scope and validity of the proprietary rights of others. Any litigation or interference proceedings involving us may require us to incur substantial legal and other fees and expenses and may require some of our employees to devote all or a substantial portion of their time to the proceedings. An adverse determination in the proceedings could subject us to significant liabilities to third parties, require us to seek licenses from third parties or prevent us from selling our products in some or all markets. We may not be able to reach a satisfactory settlement of any dispute by licensing necessary patents or other intellectual property. Even if we reached a settlement, the settlement process may be expensive and time consuming, and the terms of the settlement may require us to pay substantial royalties. An adverse determination in a judicial or administrative proceeding or the failure to obtain a necessary license could prevent us from manufacturing and selling our products. WE ARE DEVELOPING OUR CURRENT PRODUCT LINE INDEPENDENTLY FROM ANY COLLABORATIVE PARTNERS, WHICH MAY REQUIRE US TO ACCESS ADDITIONAL CAPITAL AND TO DEVELOP ADDITIONAL SKILLS TO PRODUCE, MARKET AND DISTRIBUTE THESE PRODUCTS. We are also currently seeking direct funding for and expect to commercialize our cervical cancer detection product independently of any collaborative partner. These activities require additional resources and capital that we will need to secure. There is no assurance that we will be able to raise sufficient capital or attract and retain skilled personnel to enable us to finish development, launch and market these products. Thus, there can be no assurance that we will be able to commercialize any such product. BECAUSE OUR PRODUCTS, WHICH USE DIFFERENT TECHNOLOGY OR APPLY TECHNOLOGY IN MORE INNOVATIVE WAYS THAN OTHER MEDICAL DEVICES, ARE OR WILL BE NEW TO THE MARKET, WE MAY NOT BE SUCCESSFUL IN LAUNCHING OUR PRODUCTS AND OUR OPERATIONS AND GROWTH WOULD BE ADVERSELY AFFECTED. Our products are based on new methods of cervical cancer detection. If our products do not achieve significant market acceptance, our sales will be limited and our financial condition may suffer. Physicians and individuals may not recommend or use our products unless they determine that these products are an attractive alternative to current tests that have a long history of safe and effective use. To date, our products have been used by only a limited number of people for investigational and clinical trial purposes as we have not yet obtained FDA approval on our products, and few independent studies regarding our products have been published. The lack of independent studies limits the ability of doctors or consumers to compare our products to conventional products. 11 IF WE ARE UNABLE TO COMPETE EFFECTIVELY IN THE HIGHLY COMPETITIVE MEDICAL DEVICE INDUSTRY, OUR FUTURE GROWTH AND OPERATING RESULTS WILL SUFFER. The medical device industry in general and the markets in which we expect to offer products in particular, are intensely competitive. Many of our competitors have substantially greater financial, research, technical, and manufacturing, marketing and distribution resources than we do and have greater name recognition and lengthier operating histories in the health care industry. We may not be able to effectively compete against these and other competitors. Further, if our products are not available at competitive prices, health care administrators who are subject to increasing pressures to reduce costs may not elect to purchase them. Accordingly, competition in this area is expected to increase. Furthermore, our competitors may succeed in developing, either before or after the development and commercialization of our products, devices and technologies that permit more efficient, less expensive non-invasive and less invasive monitoring, or cancer detection. It is also possible that one or more pharmaceutical or other health care companies will develop therapeutic drugs, treatments or other products that will substantially render our products obsolete. WE DO NOT HAVE MANUFACTURING EXPERIENCE, WHICH COULD LIMIT OUR GROWTH. We do not have manufacturing experience that would enable us to make products in the volumes that would be necessary for us to achieve significant commercial sales, and we rely upon our suppliers. In addition, we may not be able to establish and maintain reliable, efficient, full scale manufacturing at commercially reasonable costs, in a timely fashion. Difficulties we encounter in manufacturing scale-up, or our failure to implement and maintain our manufacturing facilities in accordance with good manufacturing practice regulations, international quality standards or other regulatory requirements, could result in a delay or termination of production. THE AVAILABILITY OF THIRD-PARTY REIMBURSEMENT FOR OUR PRODUCTS IS UNCERTAIN, WHICH MAY LIMIT CONSUMER USE AND THE MARKET FOR OUR PRODUCTS. In the United States and elsewhere, sales of medical products are dependent, in part, on the ability of consumers of these products to obtain reimbursement for all or a portion of their cost from third-party payers, such as government and private insurance plans. Any inability of patients, hospitals, physicians and other users of our products to obtain sufficient reimbursement from third-party payers for our products, or adverse changes in relevant governmental policies or the policies of private third-party payers regarding reimbursement for these products, could limit our ability to sell our products on a competitive basis. We are unable to predict what changes will be made in the reimbursement methods used by third-party health care payers. Moreover, third-party payers are increasingly challenging the prices charged for medical products and services, and some health care providers are gradually adopting a managed care system in which the providers contract to provide comprehensive health care services for a fixed cost per person. Patients, hospitals and physicians may not be able to justify the use of our products by the attendant cost savings and clinical benefits that we believe will be derived from the use of our products, and therefore may not be able to obtain third-party reimbursement. 12 Reimbursement and health care payment systems in international markets vary significantly by country and include both government sponsored health care and private insurance. We may not be able to obtain approvals for reimbursement from these international third-party payers in a timely manner, if at all. Any failure to receive international reimbursement approvals could have an adverse effect on market acceptance of our products in the international markets in which approvals are sought. OUR SUCCESS DEPENDS ON OUR ABILITY TO ATTRACT AND RETAIN SCIENTIFIC, TECHNICAL, MANAGERIAL AND FINANCE PERSONNEL. Our ability to operate successfully and manage our future growth depends in significant part upon the continued service of key scientific, technical, managerial and finance personnel, as well as our ability to attract and retain additional highly qualified personnel in these fields. We may not be able to attract and retain key employees when necessary, which would limit our operations and growth. WE HAVE RAISED SUBSTANTIAL AMOUNTS OF CAPITAL IN PRIVATE PLACEMENTS FROM TIME TO TIME. The securities offered in such private placements were not registered under the Securities Act or any state "blue sky" law in reliance upon exemptions from such registration requirements. Such exemptions are highly technical in nature and if we inadvertently failed to comply with the requirements of any of such exemptive provisions, investors would have the right to rescind their purchase of our securities or sue for damages. If one or more investors were to successfully seek such rescission or prevail in any such suit, we could face severe financial demands that could materially and adversely affect our financial position. Financings that may be available to us under current market conditions frequently involve sales at prices below the prices at which our common stock currently is reported on the NASDAQ BB as well as the issuance of warrants or convertible securities at a discount to market price. CERTAIN SHAREHOLDERS HAVE ANTI-DILUTION RIGHTS. Our Chairman and Chief Executive Officer and Robert Alfano, the inventor of much of our technology, have anti-dilution agreements which provide that such shareholders' interests in our Common Stock attributable to shares they owned on April 27, 1981 and August 19, 1999, respectively, will at all times represent approximately 17% and 4%, respectively, of the total issued and outstanding shares of our company. The issuance of our Common Stock in connection with such contractual obligations will substantially dilute the existing holders of our Common Stock. INVESTORS IN OUR SECURITIES MAY SUFFER DILUTION. The issuance of shares of Common Stock, or shares of Common Stock underlying warrants, options or preferred stock or convertible notes or anti-dilution contractual provisions of certain of our shareholders will dilute the equity interest of existing shareholders who do not have anti-dilution rights and could have a significant adverse effect on the market price of our Common Stock. The sale of Common Stock acquired at a discount could have a negative impact on the market price of our Common Stock and could increase the volatility in the market price of our Common Stock. In addition, we may seek additional financing which may result in the issuance of additional shares of our Common Stock and/or rights to acquire additional shares of our Common Stock. The issuance of our Common Stock in connection with such financing may result in substantial dilution to the existing holders of our Common Stock who do not have anti-dilution rights. Those additional issuances of Common Stock would result in a reduction of your percentage interest in our company. 13 HISTORICALLY, OUR COMMON STOCK HAS EXPERIENCED SIGNIFICANT PRICE FLUCTUATIONS. One or more of the following factors have influenced and are expected to influence these fluctuations: o announcements or press releases relating to the healthcare sector or to our own business or prospects; o regulatory, legislative or other developments affecting us or the healthcare industry generally; o conversion of our preferred stock and convertible debt into Common Stock at conversion rates based on then current market prices or discounts to market prices of our Common Stock and exercise of options and warrants at below current market prices; o sales by those financing our company through convertible securities the underlying Common Stock of which have been registered with the SEC and may be sold into the public market immediately upon conversion; and o market conditions specific to medical device companies, the healthcare industry and general market conditions. IN ADDITION, IN RECENT YEARS THE STOCK MARKET HAS EXPERIENCED SIGNIFICANT PRICE AND VOLUME FLUCTUATIONS. These fluctuations, which are often unrelated to the operating performance of specific companies, have had a substantial effect on the market price for many healthcare related technology companies. Factors such as those cited above, as well as other factors that may be unrelated to our operating performance, may adversely affect the price of our Common Stock. WE HAVE NOT HAD EARNINGS, BUT IF EARNINGS WERE AVAILABLE, IT IS OUR GENERAL POLICY TO RETAIN ANY EARNINGS FOR USE IN OUR OPERATIONS. Therefore, we do not anticipate paying any cash dividends on our common stock in the foreseeable future despite the recent reduction of the federal income tax rate on dividends. Any payment of cash dividends on our Common Stock in the future will be dependent upon our financial condition, results of operations, current and anticipated cash requirements, preferred rights of holders of preferred stock, plans for expansion, as well as other factors that our Board of Directors deems relevant. We anticipate that our future financing agreements may prohibit the payment of common stock dividends without the prior written consent of those investors. 14 WE ARE SIGNIFICANTLY INFLUENCED BY OUR DIRECTORS, EXECUTIVE OFFICERS AND THEIR AFFILIATED ENTITIES. Our directors and executive officers beneficially owned an aggregate of approximately 29% of our outstanding Common Stock as of June 30, 2004. These shareholders, acting together, would be able to exert significant influence on substantially all matters requiring approval by our shareholders, including the election of directors and the approval of mergers and other business combination transactions. CERTAIN PROVISIONS OF NEW JERSEY CORPORATE LAWS MAY HAVE CERTAIN ANTI-TAKEOVER EFFECTS. The anti-takeover provisions of the New Jersey Shareholder Protection Act described in the section "Description of Securities", may have the effect of discouraging a future takeover attempt which individual shareholders may deem to be in their best interests or in which shareholders may receive a substantial premium for their shares over then-current market prices. As a result, shareholders who might desire to participate in such a transaction may not have an opportunity to do so. THERE MAY BE A LIMITED PUBLIC MARKET FOR OUR SECURITIES; WE MAY FAIL TO QUALIFY FOR NASDAQ LISTING; AND WE MAY BE SUBJECT TO DISCLOSURE RELATING TO LOW PRICED STOCKS Although the Company, if successful in its funding efforts, intends to apply for listing of the Common Stock on either NASDAQ or a registered exchange, there can be no assurance if and when initial listing criteria could be met or if such application would be granted, or that the trading of the Common Stock will be sustained. In the event that the Common Stock fails to qualify for initial or continued inclusion in the NASDAQ System or for initial or continued listing on a registered stock exchange, trading, if any, in the Common Stock, would then continue to be conducted in the over-the-counter market in what are commonly referred to as "pink sheets", or the NASD's "Electronic Bulletin Board". As a result, an investor may find it more difficult to dispose of, or to obtain accurate quotations as to the market value of our Common Stock, and our Common Stock would become substantially less attractive for margin and purpose loans, for investment by financial institutions or as consideration in future capital raising transactions. Trading of our Common Stock may be subject to penny stock rules under the Exchange Act. Unless exempt, for any transaction involving a penny stock, the regulations require broker-dealers making a market in our Common Stock to provide risk disclosure to their customers including regarding the risks associated with our Common Stock, the suitability for the customer of an investment in our Common Stock, the duties of the broker-dealer to the customer, information regarding prices for our Common Stock and any compensation the broker-dealer would receive. The application of these rules may result in fewer market makers in our Common Stock. Our Common Stock is presently subject to the rules on penny stocks, and the liquidity of the Common Stock could be materially adversely affected so long as we remain subject to such rule. 15 USE OF PROCEEDS We will not receive any proceeds from the resale of shares covered by this prospectus. However, we have received an aggregate $37,500 from the exercise of warrants to purchase 150,000 of the shares covered by this prospectus. DESCRIPTION OF THE TRANSACTIONS On February 1, 2004, we sold 60 shares of our convertible preferred stock at a purchase price of $25,000 per share, for an aggregate purchase price of $1,500,000, to accredited investors in a private placement (the "Private Placement"). In March 2004, each share of convertible preferred stock purchased was converted into 100,000 shares of Common Stock. We agreed to register such shares of Common Stock on a registration statement (of which this prospectus forms a part). On November 15, 2001, we entered into an agreement with Chesterbrook Partners Inc. pursuant to which, among other things, Chesterbrook Partners received five-year warrants to purchase an aggregate of 200,000 shares of Common Stock, at $0.25 per share, as compensation for shareholder support services provided to us during the period February 28, 1999 to November 15, 2001. On each of December 3, 2001 and June 21, 2002, Chesterbrook Partners Inc. assigned all of its right, title and interest in a five-year warrant to purchase 50,000 shares of Common Stock for $0.25 per share to William M. Baker, a non-affiliated accredited investor. Mr. Baker exercised the warrants as to all of the shares of Common Stock on February 18, 2004 for an aggregate purchase price of $25,000. We have agreed to register such 100,000 shares of Common Stock on a registration statement (of which this prospectus forms a part). On December 21, 2001 Chesterbrook Partners Inc. assigned all of its right, title and interest in a five-year warrant to purchase 50,000 shares of Common Stock for $0.25 per share to Lawrence B. Elgart, a non-affiliated accredited investor. Mr. Elgart exercised the warrant as to all of the shares of Common Stock on February 2, 2004 for an aggregate purchase price of $12,500. We have agreed to register such 50,000 shares of Common Stock on a registration statement (of which this prospectus forms a part). On February 1, 2004, we entered into a Consulting agreement with Dr. Jeremy Rosen, under which we agreed to issue 325,000 shares of Common Stock as compensation for Dr. Rosen's medical/ FDA clinical advisory services for a period from February 1, 2004 to February 1, 2008 and to register such shares on a registration statement (of which this prospectus forms a part). The shares were issued to Dr. Rosen on March 8, 2004. On February 1, 2004, we entered into a Consulting agreement with RT Consulting Services Inc., under which we agreed to issue 1,400,000 shares of Common Stock as compensation for RT Consulting Services Inc.'s medical/FDA engineering, manufacturing, and financial advisory services from February, 2004 to February, 2008 and to register the shares on a registration statement (of which this prospectus forms a part). The shares were issued to RT Consulting Services Inc. on March 8, 2004. On April 1, 2004, we entered into a Consulting Agreement with Chesterbrook Partners Inc., under which we agreed to issue 200,000 shares of Common Stock as compensation for Chesterbrook Partners Inc.'s public relation and shareholder advisory services for the period April 1, 2004 to April 1, 2005 and to register the shares on a registration statement (of which this prospectus forms a part). The shares were issued to Chesterbrook Partners Inc. on May 5, 2004. 16 SELLING SHAREHOLDERS The following table sets forth the shares beneficially owned, as of June 30, 2004, by the Selling Shareholders prior to the offering contemplated by this prospectus, the number of shares each selling stockholder is offering by this prospectus and the number of shares which each Selling Shareholder would own beneficially if all such offered shares are sold. The Selling Shareholders acquired their beneficial interests in the shares being offered hereby in transactions described under the heading "Description of the Transactions." Except as expressly set forth below, none of the Selling Shareholders is a registered broker-dealer or an affiliate of a registered broker-dealer. Each of the Selling Shareholders has acquired his, her or its shares solely for investment and not with a view to or for resale or distribution of such securities. Beneficial ownership is determined in accordance with SEC rules and includes voting or investment power with respect to the securities.
Shares of Shares of Shares of Percentage of Common Stock Common Common Stock Common Stock Owned Prior Stock Owned after Owned After Name and Address to Offering to be Sold the Offering the Offering - ---------------- ----------- ---------- ------------ ------------ William Baker 1,610,000 400,000 1,210,000 2.4% P.O. Box 7432 Delray Beach, FL 33482 Marjorie R. Bleiden and 100,000 100,000 -0- -0- Peter P. Ippoliti, Tenants in Common 5250 Windsor Park Drive Boca Raton, FL 33496 Sean G. Burke 100,000 100,000 -0- -0- 208 Sunrise Drive Wyckoff, NJ 07481 Young W. Chang 200,000 200,000 -0- -0- 439 Albany Court West New York, NJ 07093 Chesterbrook Partners Inc. 200,000 200,000 -0- -0- P.O. Box 7432 Delray Beach, FL 33482 Lawrence B. Elgart 150,000 150,000 -0- -0- 254 Park Avenue South, Apt. 5M NY, NY 10010 David Epstein 400,000 400,000 -0- -0- 300 East 85th Street, Apt 1903 NY, NY 10028
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Financial Planning Analysts 220,000 200,000 20,000 * 734 Walt Whitman Road, Suite 301 Melville NY 11747 Liselotte Freidman 100,000 100,000 -0- -0- 5856 Vintage Oaks Circle Delray Beach, FL 33484 Peter Friedman 100,000 100,000 -0- -0- 5856 Vintage Oaks Circle Delray Beach, FL 33484 Carl D. Glaeser and Nancy N. Glaeser 100,000 100,000 -0- -0- Tenants in Common 8 Van Mulen Street Mahwah, NJ 07430 Peter P. Ippoliti Trust and 100,000 100,000 -0- -0- Marjorie R. Bleiden, Tenants in Common 5250 Windsor Park Drive Boca Raton, FL 33496 Larry S. Kasman 120,000 100,000 20,000 * 801 Washington Street, Apt. 4E Hoboken, NJ 07030 Marlene N. Kasman, Phd. 250,000 200,000 50,000 * 163 Townline Road East Northport, NY 11731 Dr. Richard Kasman 155,000 100,000 55,000 * 163 Townline Road East Northport, NY 11731 Robert Kaufman 157,623 100,000 57,623 * 200 Atlantic Avenue, Apt. 201 Lynbrook, NY, NY 11653 Dolores F. Kutlow 172,950 100,000 72,950 * 16891 Isle of Palms Drive Delray Beach, FL 33484 Linda L. Lawn 100,000 100,000 -0- -0- 5552 Via DelaPlata Cir. Delray Beach, FL 33484 Michael C. Manis 100,000 100,000 -0- -0- 5 Tatem Way Old Westbury, NY 11568 Thomas Mitchell McCann, IRA 100,000 100,000 -0- -0- 1200 Bel Aire Drive West Pembroke Pines, FL 33027
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Allen Moses & Neal M. Friedfertig, 224,820 200,000 24,820 * Tenants in Common 665 East 7th Street NY, NY 11218 Mark and Bonnie Newman, 100,000 100,000 -0- -0- Tenants in Common 2 East Putman Green Greenwich, CT 06830 Joseph Penzone 100,000 100,000 -0- -0- 3252 Waterbury Drive Wantagh, NY 11793 R & T Consulting Inc. 1,400,000 1,400,000 -0- -0- 16719 Senterra Drive Delray Beach, FL 33484 Herbert Regenstreif 207,000 100,000 107,000 * 362 Willis Avenue Mineola, NY 11501 Evan D. Rosen 100,000 100,000 -0- -0- 200 W 79th Street NY, NY 10024 Jeffery Rosen DDS 325,000 325,000 -0- -0- 446 East 86th Street, Apt 7G NY, NY 10028 Jeremy S. Rosen DDS 1,200,000 1,200,000 -0- -0- 446 East 86th Street, Apt 7G NY, NY 10028 Jeffrey Rosenfeld 120,000 100,000 20,000 * 1427 Noel Avenue Hewlett, NY, 11557 Barry Schwartz and Judith Schwartz, 100,000 100,000 -0- -0- Tenants in Common 11039 Via Lucca Boynton Beach, FL 33437 Neil B. Tygar and Michele Tygar, 100,000 100,000 -0- -0- Tenants in Common 16384 Via Venetig West Delray Beach, FL 33484 Ronald Tygar 600,000 600,000 -0- -0- 16719 Senterra Drive, Delray Beach, FL 33484
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Ronald Tygar and Francine Tygar, 400,000 400,000 -0- -0- Joint Tenants WROS 16719 Senterra Drive, Delray Beach, FL 33484 Michael J. Weiss 100,000 100,000 -0- -0- 14 Doti Court Huntington, NY 11743 Ira M. Wendroff and Diane R. Abdo, 100,000 100,000 -0- -0- Joint Tenants 17205 Newport Club Drive Boca Raton, FL 33496
___________ * Represents less than 1% None of the Selling Shareholders are affiliates or controlled by our affiliates. None of the Selling Shareholders are now or were a director or officer or has or had a material relationship with the Company or any of our predecessors or affiliates for the past three years. We have separate contractual obligations to file this registration statement (of which this prospectus forms a part) with each of the Selling Shareholders. DESCRIPTION OF SECURITIES The Company is authorized to issue 199,950,000 shares of Common Stock, par value $0.01 per share, and 50,000 shares of Preferred Stock, par value $0.01 per share. As of June 30, 2004, there were issued and outstanding (i) 50,964,703 shares of Common Stock held of record by approximately 745 holders and beneficially owned by approximately 1,200 holders and (ii) no shares of Preferred Stock. Common Stock Holders of shares of Common Stock are entitled to cast one vote for each share held at all shareholder's meetings for all purposes, including the election of directors and to share equally on a per share basis in such dividends as may be declared by the Board of Directors out of funds legally available therefor. Upon liquidation or dissolution of the Company, and after satisfaction of all liabilities and preferences of the outstanding Preferred Stock, holders of Common Stock will be entitled to share equally, on a pro rata basis, in the remainder of the assets of the Company legally available for distribution to the holders of Common Stock. No holder of Common Stock has a preemptive or preferential right to purchase or subscribe for any additional shares of Common Stock. The Common Stock does not have cumulative voting rights. After the sale of the shares offered hereby, the officers and directors of the Company, together with the Chairman of the Company's Scientific Advisory Board, will own approximately 37% of the Common Stock and therefor will, as a practical matter, be able to elect all directors of the Company. The By-Laws of the Company require that only a majority of the issued and outstanding shares of Common Stock be represented to constitute a quorum and transact business at a shareholders' meeting. Preferred Stock The Company is authorized to issue up to 50,000 Shares of Preferred Stock, $.01 par value per share, which may be issued from time-to-time in one or more series, the terms of which may be designated by the Board of Directors without further action by shareholders and may include voting rights, preferences with respect to dividends, liquidation, conversion and other rights, but will not have preemptive rights. The issuance of Preferred Stock may reduce the rights of the holders of Common Stock and therefore, the value of the Common Stock. Specific rights granted to future holders or Preferred Stock could be used to restrict our ability to merge with or sell our assets to a third party. 20 Holders of Convertible Preferred Stock are entitled to receive non-cumulative preferential dividends, if and when declared, before any dividends may be declared in the shares of Common Stock and are entitled to a preference over holders of Common Stock in the event of a liquidation of the Companys' assets. Series A Preferred Stock has no redemption or dividend rights and votes only with respect to corporate matters affecting their respective rights, preferences or limitations. Holders of Series A Preferred Stock do not vote for the election of directors or on general corporate matters. Holders of Series A Preferred Stock are entitled to a preference of $10 per share before any payment is made to holders of Common Stock on liquidation of the assets of the Company. All issued and outstanding shares of Series A Perferred Stock were converted into Common Stock in March 2004. Anti-Dilution Our Chairman and Chief Executive Officer and Robert Alfano, the inventor of much of our technology, have anti-dilution agreements which provide that such shareholders' interest in our Common Stock attributable to shares they owned on April 27, 1981 and August 19, 1999, respectively, will at all times represent approximately 17% and 4%, respectively, of the total issued and outstanding shares of our Company. The issuance of our Common Stock in connection with such contractual obligations will substantially dilute the share ownership of the existing holders of Common Stock. Anti-Takeover Effect of New Jersey Shareholder Protection Act The Company is subject to the New Jersey Shareholder Protection Act (the "Protection Act"), which restricts certain business combinations by the Company with any of its 10% shareholders. Generally, the Protection Act prohibits a publicly held New Jersey corporation with its principal executive offices and significant business operations in New Jersey from engaging in any business combination (defined generally as any merger, consolidation, sale, lease, exchange, mortgage, or pledge, or any stock transfer, securities reclassification, liquidation or dissolution, excluding certain transactions involving assets or securities which have a market value below that specified in the Protection Act) with an "Interested Shareholder" (defined generally as any person who is the beneficial owner of 10% or more of the voting power of the outstanding shares or any affiliate of the corporation who at any time within the five year period immediately prior to the date of the business combination has been the beneficial owner of 10% or more of the voting power of the outstanding shares) for a period of five years from the date the Interested Shareholder became an Interested Shareholder, unless such transaction is approved by the board of directors prior to the date the shareholder became an Interested Shareholder. In addition, the Protection Act prohibits any business combination at any time with an Interested Shareholder other than a transaction that (i) is approved by the board of directors of the applicable corporation prior to the date the Interested Shareholder became the Interested Shareholders; or (ii) is approved by the affirmative vote of the holders of two-thirds of the voting shares not beneficially owned by the Interested Shareholder at a meeting called for that purpose; or (iii) satisfied certain stringent price and terms criteria. 21 Certain shareholders may consider the Protection Act to have disadvantageous effects. Tender offers or other non-open market acquisitions of shares are frequently made at prices above the prevailing market price of a company's shares. In addition, acquisitions of shares by persons attempting to acquire control through market purchases may cause the market price of the shares to reach levels that are higher than would otherwise be the case. The Protection Act may discourage any or all of such acquisitions, particularly those of less than all of the Company's shares, and may thereby deprive certain holders of the Company's shares of an opportunity to sell their shares at a temporarily higher market price. PLAN OF DISTRIBUTION We are registering an aggregate 8,075,000 shares of common stock covered by this prospectus on behalf of the Selling Shareholders. The Selling Shareholders and any of their donees, pledgees, assignees and successors in interest may, from time to time, offer and sell any and all of their shares of Common Stock on any stock exchange, market or trading facility on which such shares are traded. The Selling Shareholders will act independently of the Company and each other in making decisions with respect to the timing, manner and size of each such sale. Sales may be made at fixed or negotiated prices. The Company believes that none of the Selling Shareholders have entered into any agreement, understanding or arrangement with any underwriter or broker-dealer for the sale of shares through a block trade, special offering, exchange distribution or secondary distribution of a purchase by a broker-dealer. The shares may be sold by way of any legally available means, including in one or more of the following transactions: o a block trade in which a broker-dealer engaged by a Selling Shareholder attempts to sell the shares as agent but may position and resell a portion of the block as principal to facilitate the transaction; o purchases by a broker-dealer as principal and resale by the broker-dealer for its account pursuant to this prospectus; and o ordinary brokerage transactions and transactions in which a broker-dealer solicits purchasers. o privately negotiated transactions. Transactions under this prospectus may or may not involve brokers or dealers. The Selling Shareholders may sell shares directly to purchasers or to or through broker-dealers, who may act as agents or principals. Broker-dealers engaged by the Selling Shareholders may arrange for other broker-dealers to participate in selling shares. Broker-dealers or agents may receive compensation in the form of commissions, discounts or concessions from the Selling Shareholders in amounts to be negotiated in connection with the sale. Broker-dealers or agents also may receive compensation in the form of discounts, concessions or commissions from the purchasers of shares for whom the broker-dealers may act as agents or to whom they sell as principal, or both. The Selling Shareholders do not expect 22 these commisions and discounts to exceed what is customary in the types of transactions involved. Selling Shareholders and any broker-dealers and any other participating broker-dealers who execute sales for the Selling Shareholders may be deemed to be "underwriters" within the meaning of the Securities Act in connection with such sales. In such event, any commissions received by such broker-dealers or agents and any profit on the resale of the shares purchased by them may be deemed to be underwriting discounts and commissions under the Securities Act. If the Selling Shareholders are deemed to be underwriters, they may be subject to certain statutory and regulatory liabilities, including liabilities imposed pursuant to Sections 11, 12 and 17 of the Securities Act and Rule 10b-5 under the Exchange Act. To the extent required, the number of shares to be sold, the name of the Selling Shareholder, the purchase price, the name of any agent or broker and any applicable commissions, discounts or other compensation to such agents or brokers and other material facts with respect to a particular offering will be set forth in a prospectus supplement. The Selling Shareholders may also sell shares under Rule 144 under the Securities Act if available, rather than pursuant to this prospectus. In order to comply with the securities laws of certain states, if applicable, the shares will be sold in such jurisdictions, if required, only through registered or licensed brokers or dealers. In addition, in certain states the shares may not be sold unless the shares have been registered or qualified for sale in such state or an exemption from registration or qualification is available and complied with. We advised the Selling Shareholders that the anti-manipulative provisions of Regulation M promulgated under the Exchange Act may apply to their sales of the shares offered hereby. We are required to pay all fees and expenses incident to the registration of the shares. Otherwise, all discounts, commissions or fees secured in connection with the sale of Common Stock offered hereby will be paid by the Selling Shareholders. INDEMNIFICATION OF DIRECTORS AND OFFICERS Section 14A:3-5 of the Business Corporation Act of New Jersey provides, in general, that a corporation incorporated under the laws of the State of New Jersey, such as the registrant, may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding by reason of the fact that such person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another enterprise, against expenses (including attorneys' fees), judgments, fines, penalties and amounts paid in settlement incurred by such person in connection with such action, suit or proceeding if such person acted in good faith and in a manner such person 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 such person's conduct was unlawful. The Company and each Selling Shareholder have agreed to indemnify and hold harmless the other against any losses, claims, damages or liabilities (including reasonable legal and other expenses reasonably incurred in and investigating and defending against the same), to which each may become subject under the Securities Act, or state securities laws or liabilities, arising out of or based upon any untrue statement or alleged untrue statement of any material fact contained in this Registration Statement, the prospectus contained in this Registration Statement or any amendment or supplement to this Registration Statement, or arise out of or base upon any omission or alleged omission to state therein a material fact required to be stated therein where necessary to make the statements contained therein not misleading. 23 Our Certificate of Incorporation and Bylaws provide that we shall indemnify our directors, officers, employees and agents to the extent and in the manner permitted by the provisions of the laws of the State of New Jersey as amended from time to time, subject to any permissible expansion or limitation of such indemnification, as may be set forth in any shareholders' or directors' resolution or by contract. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling the Company pursuant to the foregoing provisions, we have been informed that in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable. WHERE YOU CAN FIND MORE INFORMATION ABOUT US We file annual, quarterly and current reports, information statements and other information with the SEC. Our filings are available to the public over the internet at the SEC's web site at http://www.sec.gov. You may also read and copy any document we file at the SEC's Public Reference Room, 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the Public Reference Room. This prospectus is part of a Registration Statement on Form S-3 filed with the SEC under the Securities Act. This prospectus does not contain all of the information set forth in the Registration Statement, certain parts of which are omitted in accordance with the rules and regulations of the SEC. For further information, reference is made to the Registration Statement and the exhibits filed as a part thereof, which may be found at the location and website referenced above. INCORPORATION OF CERTAIN INFORMATION BY REFERENCE The SEC allows us to "incorporate by reference" in this prospectus the information we file with them, which means that we can disclose important information to you by referring you to those documents. All information incorporated herein by reference is an important part of this prospectus, and information that we file later with the SEC will automatically update and supersede this information. We incorporate by reference the documents listed below and any future filings made with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act until all shares offered by this prospectus are sold: o Annual Report on Form 10-KSB, dated February 29, 2004 o Quarterly Report on Form 10-QSB, dated July 20, 2004 o Definitive Information Statement to Shareholders on Schedule 14C filed with the SEC on January 20, 2004 o The description of our common stock contained in our Registration Statement on Form S-1 filed with the SEC on December 9, 1971, together with any reports filed for the purpose of updating such description. You may request a copy of these filings, or any other documents or other information referred to or incorporated by reference in this prospectus, at no cost, by writing or calling us at: 24 Mediscience Technology Corp. 161 N. Franklin Turnpike Ramsey, New Jersey 07446 Attn: Michael Engelhart, President Telephone: (201) 925-5077 Exhibits to the documents incorporated by reference will not be sent, however, unless these exhibits have been specifically referenced in this prospectus. LEGAL MATTERS Certain legal matters with respect to the validity of the securities being offered hereby have been passed upon for the Company by Olshan Grundman Frome Rosenzweig & Wolosky LLP. A member of Olshan Grundman Frome Rosenzweig & Wolosky LLP owns shares of our common stock. EXPERTS The consolidated financial statements incorporated in this prospectus by reference to the Annual Report on Form 10-KSB of Mediscience Technology Corp. for the year ended February 29, 2004 have been audited by Parente Randolph LLC, independent registered public accounting firm, as stated in their report, appearing therein, which included an explanatory paragraph indicating that substantial doubt exists about the Company's ability to continue as a going concern, and have been incorporated herein by reference in reliance upon the report of such firm given upon their authority as experts in accounting and auditing. Part II ------- INFORMATION NOT REQUIRED IN PROSPECTUS Item 14. Other Expenses of Issuance and Distribution The expenses payable by the Registrant in connection with this Registration Statement are estimated as follows: SEC Registration Fee $ 511.55 Accounting Fees and Expenses 28,000 Legal Fees and Expenses 50,000 Transfer Agent Fees and Expenses 2,000 Printing Fees and Expenses 1,000 Miscellaneous Expenses 500 Total $82,011.55 Item 15. Indemnification of Directors and Officers. Section 14A:3-5 of the Business Corporation Act of New Jersey provides, in general, that a corporation incorporated under the laws of the State of New Jersey, such as the registrant, may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding by reason of the fact that such person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another enterprise, against expenses (including attorneys' fees), judgments, fines, penalties and amounts paid in settlement incurred by such person in connection with such action, suit or proceeding if such person acted in good faith and in a manner such person 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 such person's conduct was unlawful. 25 The Company and each Selling Shareholder have agreed to indemnify and hold harmless the other against any losses, claims, damages or liabilities (including reasonable legal and other expenses reasonably incurred in and investigating and defending against the same), to which each may become subject under the Securities Act, or state securities laws or liabilities, arising out of or based upon any untrue statement or alleged untrue statement of any material fact contained in this Registration Statement, the prospectus contained in this Registration Statement or any amendment or supplement to this Registration Statement, or arise out of or based upon any omission or alleged omission to state therein a material fact required to be stated therein where necessary to make the statements contained therein not misleading. Our Certificate of Incorporation and Bylaws provide that we shall indemnify our directors, officers, employees and agents to the extent and in the manner permitted by the provisions of the laws of the State of New Jersey as amended from time to time, subject to any permissible expansion or limitation of such indemnification, as may be set forth in any shareholders' or directors' resolution or by contract. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling the Company pursuant to the foregoing provisions, we have been informed that in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable. Item 16. Exhibits. Exhibit Number Description - ------ ----------- 4.1 Letter Agreement, dated November 15, 2001 between the Company and Chesterbrook Partners Inc. 4.2 Stock Purchase Warrant, dated November 15 2001, issued to Chesterbrook Partners Inc. to purchase 100,000 shares at an exercise price of $0.25 4.3 Stock Purchase Warrant, dated November 15, 2001, issued to Chesterbrook Partners Inc. to purchase 50,000 shares at an exercise price of $0.25 4.4 Stock Purchase Warrant, dated November 15 2001, issued to Chesterbrook Partners Inc. to purchase 50,000 shares at an exercise price of $0.25 26 4.5 Assignment of Stock Purchase Warrant, dated December 3, 2001 and June 21, 2002, to purchase 100,000 shares at an exercise price of $0.25 from Chesterbrook Partners Inc. to William Baker 4.6 Assignment of Stock Purchase Warrant dated December 21, 2001, to purchase 50,000 shares at an exercise price of $0.25 from Chesterbrook Partners Inc. to Lawrence B. Elgart 4.7 Consulting Agreement, dated April 1, 2004, between the Company and Chesterbrook Partners Inc. 4.8 Consulting Agreement, dated February 1, 2004, between the Company and Jeremy Rosen 4.9 Consulting Agreement, dated February 1, 2004, between the Company and RT Consulting Services Inc. 4.10 Form of Subscription Agreement between the Company and each of the Selling Shareholders which participated in the Private Placement 5.1 Opinion of Olshan Grundman Frome Rosenzweig & Wolosky LLP 23.1 Consent of Parente Randolph, LLC 23.2 Consent of Olshan Grundman Frome Rosenzweig & Wolosky LLP (included in Exhibit 5.1) 24 Power of Attorney (included on signature page) Item 17. Undertakings. The undersigned Registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement: a) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933; b) To reflect in the prospectus any facts or events arising after the effective date of the Registration Statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the 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 percent change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective Registration Statement; 27 c) To include any material information with respect to the plan of distribution not previously disclosed in the Registration Statement or any material change to such information in the Registration Statement; provided, however, that clauses (a) and (b) do not apply if the information required to be included in a post-effective amendment by such clauses is contained in periodic reports filed with or furnished to the Securities and Exchange Commission by the Registrant pursuant to Section 13 or Section 15(d) of the Exchange Act that are incorporated by reference in the Registration Statement. (2) That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed 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. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (4) That, for purposes of determining any liability under the Securities Act, each filing of the Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the Exchange Act that is incorporated by reference in this Registration Statement 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. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to the provisions described under Item 15 above, or otherwise, the Registrant has been advised that in the opinion of the SEC 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 Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant 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 Registrant 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 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. The undersigned Registrant hereby undertakes that: (1) For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this Registration Statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant 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. (2) For the purpose of determining any liability under the Securities Act of 1933, 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. (3) The undersigned Registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the Registrant's annual report pursuant to section 13(a) or section 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan's annual report pursuant to section 15(d) of the Exchange Act) that is incorporated by refer in the Registration Statement shall be deemed to be a new regist statement relating to the securities offered therein, and the of of such securities at that time shall be deemed to be the initia fide offer thereof. 28 SIGNATURES Pursuant to 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 S-3 and has duly caused this Registration Statement on Form S-3 to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Stone Harbor, State of New Jersey, on July 30, 2004. Mediscience Technology Corp. By: /s/ Peter Katevatis ------------------- Chairman and Chief Executive Officer Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed below by the following persons in the capacities and on the dates indicated. KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below in so signing also makes, constitutes and appoints Peter Katevatis and Michael Engelhart his true and lawful attorney-in-fact and agent, with full power of substitution and reconstitution, for him and in his name, place, and stead, in any and all capacities, to sign and file Registration Statement(s) and any and all pre-or post-effective amendments to such Registration Statement(s), with all exhibits thereto and hereto, and other documents with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent, and each of them, full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his substitutes, may lawfully do or cause to be done by virtue hereof. Signatures Title Date - ---------- ----- ---- /s/ Peter Katevatis Chairman, Chief Executive Officer and July 28, 2004 - --------------- Director Peter Katevatis /s/ Michael Engelhart President, Chief Operating Officer and July 28, 2004 - --------------------- Director Michael Engelhart /s/ John Kennedy Chief Financial Officer and Director July 28, 2004 - ---------------- John Kennedy /s/ John Matheu Director July 28, 2004 - --------------- John Matheu /s/ William Armstrong Director July 28, 2004 - --------------------- William Armstrong /s/ Sidney Braginsky Director July 28, 2004 - -------------------- Sidney Braginsky /s/ Michael Kouvatas Director July 28, 2004 - -------------------- Michael Kouvatas 29 EX-4.1 2 exhibit4-1.txt Chesterbrook Partners Inc. P.O. Box 812634 Boca Raton, FL 33481 Agreement Between Mediscience Technology Corp. And Chesterbrook Partners Inc. November 15, 2001 Peter Katevatis, Esq., Chairman Mediscience Technology Corp. P.O. Box 598 Cherry Hill, NJ 08003 RE: The ongoing Negotiation of the $45,000 total Funded by Chesterbrook Partners Inc. to Mediscience The parties agree: 1. Chesterbrook will receive 180,000 shares of Rule 144 legend Mediscience common stock ($0.25 per share), to be registered I/N/O Ned H. Elgart and delivered to: Ned H. Elgart P.O. Box 812634 Boca Raton, Fl, 33481 2. Chesterbrook will also receive 200,000 assignable options to purchase common shares of Mediscience at an exercise price of $0.25 per share, exercisable for a period of five (5) years. These options are to be issued to Chesterbrook Partners Inc. and delivered to the above address in three separate increment option documents; 100,000 50,000 and 50,000 3. The above agreement will be considered full and final settlement of all prior understandings between Mediscience and Chesterbrook, its agents, servants and employees. Sincerely /s/Ned H. Elgart Ned H. Elgart, President Chesterbrook Partners Inc. ACKNOWLEDGED AND AGREED TO: Date:11/15/01 /s/Peter Katevatis Peter Katevatis, Esq., Chairman Mediscience Technology Corp. EX-4.2 3 exhibit4-2.txt STOCK PURCHASE WARRANT TO PURCHASE COMMON STOCK OF MEDISCIENCE TECHNOLOGY CORP. (MTC DATE: November 15, 2001 Neither this Warrant nor the shares of Common Stock issuable upon exercise of this Warrant have been registered under the Securities Act of 1933, and neither this Warrant nor such shares of Common Stock can be sold or transferred unless and until they are so registered or unless such registration is not then required under the circumstances of such sale or transfer. Warrant to purchase up to (100,000) one hundred thousand shares of Common Stock Dated November 15, 2001 Cherry Hill New Jersey. This certifies that for value received, Chesterbrook Partners Inc. (CP) is entitled to subscribe for and purchase from (MTC), a corporation organized and existing under the laws of the State of New Jersey, at the price of $.25 per share for 100,000 shares subject to this Warrant and its terms and conditions. This five (5) year Warrant shall be exercisable from and after November 15, 2001 up to November 15, 2006, its expiration date. This warrant is TOTALLY ASSIGNABLE by (CP) at any time, such assignment effected by notice of such assignment received and acknowledged by Mediscience Technology Corp. at its office 1235 Folkstone Way, Cherry Hill NJ 08034. It is understood that the holder of this warrant has no anti-dilution rights and shall have none of the rights, privileges or liabilities of the shareholders of the company in law or equity prior to written notice to Mediscience Technology of the exercise of this warrant. In witness hereof Mediscience Technology Corporation has caused this warrant to be signed by its duly authorized officer under its corporate seal. /s/Peter Katevatis /s/Ned H. Elgart - ------------------ ---------------- Peter Katevatis, Chairman/CEO Accepted:Chesterbrook Partners Inc. Mediscience Technology Corp. By: Ned H. Elgart, President November 15, 2001 Cherry Hill NJ EX-4.3 4 exhibit4-3.txt STOCK PURCHASE WARRANT TO PURCHASE COMMON STOCK OF MEDISCIENCE TECHNOLOGY CORP. (MTC DATE: November 15, 2001 Neither this Warrant nor the shares of Common Stock issuable upon exercise of this Warrant have been registered under the Securities Act of 1933, and neither this Warrant nor such shares of Common Stock can be sold or transferred unless and until they are so registered or unless such registration is not then required under the circumstances of such sale or transfer. Warrant to purchase up to (50,000) fifty thousand shares of Common Stock Dated November 15, 2001 Cherry Hill New Jersey. This certifies that for value received, Chesterbrook Partners Inc. (CP) is entitled to subscribe for and purchase from (MTC), a corporation organized and existing under the laws of the State of New Jersey, at the price of $.25 per share for 50,000 shares subject to this Warrant and its terms and conditions. This five (5) year Warrant shall be exercisable from and after November 15, 2001 up to November 15, 2006, its expiration date. This warrant is TOTALLY ASSIGNABLE by (CP) at any time, such assignment effected by notice of such assignment received and acknowledged by Mediscience Technology Corp. at its office 1235 Folkstone Way, Cherry Hill NJ 08034. It is understood that the holder of this warrant has no anti-dilution rights and shall have none of the rights, privileges or liabilities of the shareholders of the company in law or equity prior to written notice to Mediscience Technology of the exercise of this warrant. In witness hereof Mediscience Technology Corporation has caused this warrant to be signed by its duly authorized officer under its corporate seal. /s/Peter Katevatis /s/Ned H. Elgart - ------------------ ---------------- Peter Katevatis, Chairman/CEO Accepted:Chesterbrook Partners Inc. Mediscience Technology Corp. By: Ned H. Elgart, President November 15, 2001 Cherry Hill NJ EX-4.4 5 exhibit4-4.txt STOCK PURCHASE WARRANT TO PURCHASE COMMON STOCK OF MEDISCIENCE TECHNOLOGY CORP. (MTC DATE: November 15, 2001 Neither this Warrant nor the shares of Common Stock issuable upon exercise of this Warrant have been registered under the Securities Act of 1933, and neither this Warrant nor such shares of Common Stock can be sold or transferred unless and until they are so registered or unless such registration is not then required under the circumstances of such sale or transfer. Warrant to purchase up to (50,000) fifty thousand shares of Common Stock Dated November 15, 2001 Cherry Hill New Jersey. This certifies that for value received, Chesterbrook Partners Inc. (CP) is entitled to subscribe for and purchase from (MTC), a corporation organized and existing under the laws of the State of New Jersey, at the price of $.25 per share for 50,000 shares subject to this Warrant and its terms and conditions. This five (5) year Warrant shall be exercisable from and after November 15, 2001 up to November 15, 2006, its expiration date. This warrant is TOTALLY ASSIGNABLE by (CP) at any time, such assignment effected by notice of such assignment received and acknowledged by Mediscience Technology Corp. at its office 1235 Folkstone Way, Cherry Hill NJ 08034. It is understood that the holder of this warrant has no anti-dilution rights and shall have none of the rights, privileges or liabilities of the shareholders of the company in law or equity prior to written notice to Mediscience Technology of the exercise of this warrant. In witness hereof Mediscience Technology Corporation has caused this warrant to be signed by its duly authorized officer under its corporate seal. /s/Peter Katevatis /s/Ned H. Elgart - ------------------ ---------------- Peter Katevatis, Chairman/CEO Accepted:Chesterbrook Partners Inc. Mediscience Technology Corp. By: Ned H. Elgart, President November 15, 2001 Cherry Hill NJ EX-4.5 6 exhibit4-5.txt ASSIGNMENT DATE : Dec 3/ 2001 (50,000) ---------------------------- June 21/ 2002 (50,000) Chesterbrook Partners Inc. hereby executes an assignment of all its existing right, title and interest in a Mediscience Technology Warrant issued to and accepted by Chesterbrook Partners Inc. on November 15, 2001, attached hereto representing the right to purchase 100,000 shares of Mediscience Common Shares at $.25 per share. This assignment is subject to all terms of the underlying warrant and is immediately vested and effective upon notice to Mediscience Technology by Chesterbrook Partners Inc. in accordance with its terms. By my signature below, and intending to be legally bound pursuant to the laws of the State of New Jersey I hereby execute this assignment. To William Baker ------------------------------------------------------------------------------ PO Box 7432 ------------------------------------------------------------------------------ DELRAY BEACH, FLA 33482 ------------------------------------------------------------------------------ /s/Ned H. Elgart - ----------------------------- Chesterbrook Partners Inc. by Ned H. Elgart, President PO Box 81234 Boca Raton Florida, 33481 EX-4.6 7 exhibit4-6.txt ASSIGNMENT DATE : 12/21/2001 ---------------------------- Chesterbrook Partners Inc. hereby executes an assignment of all its existing right, title and interest in a Mediscience Technology Warrant issued to and accepted by Chesterbrook Partners Inc. on November 15, 2001, attached hereto representing the right to purchase 50,000 shares of Mediscience Common Shares at $.25 per share. This assignment is subject to all terms of the underlying warrant and is immediately vested and effective upon notice to Mediscience Technology by Chesterbrook Partners Inc. in accordance with its terms. By my signature below, and intending to be legally bound pursuant to the laws of the State of New Jersey I hereby execute this assignment. To Laurence B. Elgart ------------------------------------------------------------------------------ 254 Park Ave South Apt 5M ------------------------------------------------------------------------------ New York NY 10010 ------------------------------------------------------------------------------ /s/Ned H. Elgart - ----------------------------- Chesterbrook Partners Inc. by Ned H. Elgart, President PO Box 81234 Boca Raton Florida, 33481 EX-4.7 8 exhibit4-7.txt CHESTERBROOK PARTNERS INC. (CP) PO BOX 7432 DELRAY BEACH FLORIDA, 33482 Subject: shareholder relations agreement with Mediscience Technology (MTC) Date: April 1, 2004 Whereas: (CP) has acted in the capacity of shareholder relationship on behalf of (MTC) for the past 14 years and wishes to continue to represent (MTC) and its Board of Directors/Officers to the financial community maintaining an informed shareholder base and, Whereas, (MTC) regards such activity as vital to its corporate SEC Full Reporting (FR) obligations which are obligatory continuing under Sarbanes Legislation, represented by periodic SEC 8-K filings and the constant up-dating of the Company's web pg. MEDISCIENCETECH.com and, Therefore (CR ) and (MTC) hereby agree that as consideration for the above services for the fiscal year 2004 through February 28, 2005 (CR) shall be entitled to and receive the sum of $2,000.00 per month and be issued 200,000 Shares of (MTC) as SEC restricted Rule 144 Common. NOTICE: (CP) 32 Seabreeze Ave. #C Delray Beach Fla. 33483 (561) 274 7420 (MTC) 1235 Folkstone Way Cherry Hill NJ 08034 (215) 485 0362 The parties intending to be legally bound pursuant to the Law of the State of New York herein affix their respective d/signatures /s/ Peter Katevalis - ------------------------- Mediscience Technology Corp. /s/Ned H. Elgart - -------------------------- Chesterbrook Partners Inc. EX-4.8 9 ex4-8.txt Exhibit 4.8 Mediscience Jeremy Rosen DDS Consulting Agreement This Agreement is made on February 1, 2004 between Mediscience Technology Corp. (MTC) 1235 Folkstone way, Cherry Hill NJ, 08034 and Jeremy Rosen DDS 446 East 86th Street, Apt 7G New York, NY. Consultant has extensive Medical/Dental/Oral Health experience regarding FDA Clinical, structuring, management, and overview and expertise in supporting/participating in management presentations seeking corporate funding and/or corporate relationships. MTC seeks to benefit from the Consultant's expertise by retaining the Consultant as an exclusive Technical Consultant in the area of Dental/Oral applications of the Company's Technology. The Consultant wishes to perform consulting services for the MTC. Accordingly, MTC and the Consultant agree as follows: 1. Services a. The consultant shall provide advice and consulting services to the Company with respect to matters related to Medical/Dental/Oral Health experience regarding FDA Clinical, structuring, management, and overview and share his expertise in supporting/participating in management presentations seeking corporate funding and/or corporate relationships. The Consultant shall be engaged by the MTC as a consultant for the exchange of ideas only and under the terms of this Agreement, shall not direct or conduct or participate in fund raising of any kind for or on behalf of the Company. Any such activity which may be conducted shall be carried out solely and only by MTC management or designees b. Upon request by the Company and in return for compensation detailed in Article 2, the Consultant shall keep MTC informed about applications, features, and specifications in its area of expertise as they may broaden or change from time to time as well as be available for assisting in Dental/Oral quality product control issues. 2. Compensation As the full and sole consideration for the consulting services provided by the Consultant, the Company shall pay to the Consultant three hundred and twenty five thousand (325,000) of Mediscience common SEC Restricted and legended by the transfer agent as SEC 144 3. Competition The Consultant represents to the Company that the Consultant does not have any agreement to provide consulting services to any other party, firm, or company in the BIO-TECHNOLOGY industry on matters relating to the scope of this consultancy, and will not enter into any such agreement during the term of this Agreement. The Company acknowledges and agrees, however, that nothing in this Agreement shall affect the Consultant's right to contract with the Research Foundation of City University of New York (CUNY) or any component of CUNY System, 4. Confidentiality a. The parties may wish, from time to time, in connection with work contemplated under this Agreement, to disclose confidential information to each other ("Confidential Information"). Each party will use reasonable efforts to prevent the disclosure of any of the other party's Confidential Information to third parties for a period of seven (_7_) years from receipt thereof. The recipient may acquire information that pertains to the discloser's processes, equipment, programs, developments, or plans that is both (i) disclosed or made known by the disclosure to the recipient and (ii) identified in writing as "proprietary" by the disclosure. The recipient agrees not to disclose any Confidential Information to third parties or to use any Confidential Information for any purpose other than performance of the services contemplated by this Agreement, without prior written consent of the Company. b. Confidential Information subject to paragraph 4(b) does not include information that (i) is or later becomes available to the public through no breach of this Agreement by the recipient; (ii) is obtained by the recipient from a third party who had the legal right to disclose the information to the recipient; (iii) is already in the possession of the recipient on the date this Agreement becomes effective; (iv) is independently developed by recipient; or (v) is required to be disclosed by law, government regulation, or court order. In addition, Confidential Information subject to paragraph 4(b) does not include information generated by the Consultant unless the information (i) is generated as a direct result of the performance of consulting services under this Agreement. 5. Return of Materials The Consultant agrees to promptly return, following the termination of this Agreement or upon earlier request by the Company, all drawings, tracings, and written materials in the Consultant's possession and (i) supplied by the Company in conjunction with the Consultant's consulting services under this Agreement or (ii) generated by the Consultant in the performance of consulting services under this Agreement. 6. Intellectual Property a. Title to any inventions and discoveries made by or contributed to by Consultant resulting from the work performed hereunder shall reside in MTC title to all inventions and discoveries made by MTC resulting from the research performed hereunder shall reside in MTC; title to all inventions and discoveries made jointly by Consultant and Company resulting from the research performed hereunder shall reside in MTC and Company. Inventorship shall be determined in accordance with U.S. Patent law. 7. Term and Termination a. This Agreement shall be for a term of 12 months, renewable upon reasonable terms and conditions as may be agreed upon by the Company and the Consultant. b. Termination of the Agreement under paragraph 8(a) above shall not affect (a) the Company's obligation to pay for services previously performed by the Consultant and acknowledged by MTC 8. Miscellaneous a. This Agreement shall inure to the benefit of and be binding upon the respective heirs, executors, successors, representatives, and assigns of the parties, as the case may be. b. The relationship created by this Agreement shall be that of independent contractor, and the Consultant shall have no authority to bind or act as agent for the Company or its employees for any purpose. c. The Company will not use the Consultant's name in any commercial advertisement or similar material used to promote or sell products, unless the Company obtains in advance the written consent of the Consultant. d. Share transfer hereunder shall be deemed to have been properly given / paid when deposited with the United States Postal Service, registered or certified mail, by Registrar & Transfer Co MTC's transfer agent in accordance with written instructions provided by Consultant as to share issuance R/N/O addressed as follows: 1235 Folkstone Way, Cherry Hill NJ 08034 Attn: Peter Katevatis 446 East 86th Street, Apt 7G New York, NY e. This Agreement replaces all previous agreements and the discussions relating to the subject matters hereof and constitutes the entire and only agreement between, the Company and the Consultant with respect to the subject matters of this Agreement. This Agreement may not be modified in any respect by any verbal statement, representation, or agreement made by any employee, officer, or representative of the Company, or by any written documents unless it is signed by the CEO of the Company and by the Consultant. f. If any term or provision of this Agreement is deemed invalid, contrary to, or prohibited under applicable laws or regulation of any jurisdiction, this Agreement (save only this sentence) shall be invalid. g. The parties hereto agree to be bound by and under New York State Law and to submit any and ail disputes of whatsoever kind to the American Arbitration association of New York City IN WITNESS WHEREOF, the parties have executed this Agreement effective the date first stated above. By: Jeremy Rosen ODS, Date, 3/4/04 /s/ Jeremy Rosen By: Peter Katevatis, Chairman/CEO /s/ Peter Katevatis Mediscience Technology Corp Date: 4/3/04 EX-4.9 10 ex4-9.txt Exhibit 4.9 Mediscience RT Consulting Agreement This Agreement is made on February 1, 2004 between Mediscience Technology Corp. (MTC) 1235 Folkstone way, Cherry Hill NJ, 08034 and RT Consulting Services Inc. 16719 Senterra Dr. Delray Beach FI. 33484. Consultant has extensive US experience regarding corporate management, corporate structuring and related presentations especially for corporate venture/associations, and the MTC seeks to benefit from the Consultant's expertise by retaining the Consultant as an exclusive Technical Consultant. The Consultant wishes to perform consulting services for the MTC. Accordingly, MTC and the Consultant agree as follows: 1. Services a. The consultant shall provide advice and consulting services to the Company with respect to matters related to corporate management, corporate structuring and related presentations for corporate marketing ventures and/or associations. The Consultant shall be engaged by the MTC as a consultant for the exchange of ideas only and under the terms of this Agreement, shall not direct or conduct or participate in fund raising of any kind for or on behalf of the Company. Any such activity which may be conducted shall be carried out solely and only by MTC management or designees. b. Upon request by the Company and in return for compensation detailed in Article 2, the Consultant shall keep MTC informed about applications, features, and specifications in its area of expertise as they may broaden or change from time to time as well as be available for assisting in quality product control issues. 2. Compensation As the full and sole consideration for the consulting services provided by the Consultant, the Company shall pay to the Consultant One Million four hundred thousand shares (1,400,000) of Mediscience common SEC Restricted and legended by the transfer agent 144. 3. Competition The Consultant represents to the Company that the Consultant does not have any agreement to provide consulting services to any other party, firm, or company in the BIO-TECHNOLOGY industry on matters relating to the scope of this consultancy, and will not enter into any such agreement during the term of this Agreement. The Company acknowledges and agrees, however, that nothing in this Agreement shall affect the Consultant's right to contract with the Research Foundation of City University of New York (CUNY) or any component of CUNY System. 4. Confidentiality a. The parties may wish, from time to time, in connection with work contemplated under this Agreement, to disclose confidential information to each other ("Confidential Information"). Each party will use reasonable efforts to prevent the disclosure of any of the other party's Confidential Information to third parties for a period of seven (-7-) years from receipt thereof. The recipient may acquire information that pertains to the discloser's processes, equipment, programs, developments, or plans that is both (i) disclosed or made known by the disclosure to the recipient and (ii) identified in writing as "proprietary" by the disclosure. The recipient agrees not to disclose any Confidential Information to third parties or to use any Confidential Information for any purpose other than performance of the services contemplated by this Agreement, without prior written consent of the Company. b. Confidential Information subject to paragraph 4(b) does not include information that (i) is or later becomes available to the public through no breach of this Agreement by the recipient; (ii) is obtained by the recipient from a third party who had the legal right to disclose the information to the recipient; (iii) is already in the possession of the recipient on the date this Agreement becomes effective; (iv) is independently developed by recipient; or (v) is required to be disclosed by law, government regulation, or court order. In addition, Confidential Information subject to paragraph 4(b) does not include information generated by the Consultant unless the information (i) is generated as a direct result of the performance of consulting services under this Agreement. 5. Return of Materials The Consultant agrees to promptly return, following the termination of this Agreement or upon earlier request by the Company, all drawings, tracings, and written materials in the Consultant's possession and (i) supplied by the Company in conjunction with the Consultant's consulting services under this Agreement or (ii) generated by the Consultant in the performance of consulting services under this Agreement. 6. Intellectual Property a. Title to any inventions and discoveries made by or contributed to by Consultant resulting from the work performed hereunder shall reside in MTC title to all inventions and discoveries made by MTC resulting from the research performed hereunder shall reside in MTC; title to all inventions and discoveries made jointly by Consultant and Company resulting from the research performed hereunder shall reside in MTC and Company. Inventorship shall be determined in accordance with U.S. Patent law. 7. Term and Termination a. This Agreement shall be for a term of 48 months, renewable upon reasonable terms and conditions as may be agreed upon by the Company and the Consultant. b. Termination of the Agreement under paragraph 8(a) above shall not affect (a) the Company's obligation to pay for services previously performed by the Consultant and acknowledged by MTC. 8. Miscellaneous a. This Agreement shall inure to the benefit of and be binding upon the respective heirs, executors, successors, representatives, and assigns of the parties, as the case may be. b. The relationship created by this Agreement shall be that of independent contractor, and the Consultant shall have no authority to bind or act as agent for the Company or its employees for any purpose. c. The Company will not use the Consultant's name in any commercial advertisement or similar material used to promote or sell products, unless the Company obtains in advance the written consent of the Consultant. d. Share transfer hereunder shall be deemed to have been properly given / paid when deposited with the United States Postal Service, registered or certified mail, by Registrar & Transfer Co MTC's transfer agent in accordance with written instructions provided by Consultant as to share issuance R/N/O addressed as follows: 1235 Folkstone Way, Cherry Hill NJ 08034 Attn: Peter Katevatis 1619 Senterra Dr. Delray Beach FL. 33484 e. This Agreement replaces all previous agreements and the discussions relating to the subject matters hereof and constitutes the entire agreement between the Company and the Consultant with respect to the subject matters of this Agreement. This Agreement may not be modified in any respect by any verbal statement, representation, or agreement made by any employee, officer, or representative of the Company, or by any written documents unless it is signed by an officer of the Company and by the Consultant. f. If any term or provision of this Agreement is deemed invalid, contrary to, or prohibited under applicable laws or regulation of any jurisdiction, this Agreement (save only this sentence) shall be invalid. g. The parties hereto agree to be bound by and under New York State Law and to submit any and all disputes of whatsoever kind to the American Arbitration association of New York City IN WITNESS WHEREOF, the parties have executed this Agreement effective the date first stated above. By: Ronald Tygar, President RT consulting Inc. Date: 3/2/04 /s/ Ronald Tygar By: Peter Katevatis, Chairman/CEO Mediscience Technology Corp. Date: 4/3/04 /s/ Peter Katevatis EX-4.10 11 ex4-10.txt Exhibit 4.10 SUBSCRIPTION AGREEMENT FOR MEDISCIENCE TECHNOLOGY CORP.(OTC-MDSC) If you are interested in purchasing shares ("Shares") of the common stock (the Common Stock") of Mediscience Technology Corp. (the "Company"), you must: a) complete this Subscription Agreement (the "Agreement"); b) provide a check or money order (unless a wire transfer is being sent) made payable to "Mediscience Technology Corp. for deposit only to / Solomon Smith Barney Account No. 715-17097" c) deliver both the Agreement and payment to: Agent: Peter Katevatis Esquire Address: 2318 Perot Street Philadelphia, Penna 19130 The Company may accept or reject any subscription you tender, in whole or in part. This means that the Company may allocate to you a smaller number of Shares than you subscribed to purchase. If accepted by the Company, then this Agreement will constitute your subscription for ____share/s of Mediscience non-interest bearing convertible preferred, with each individual dollar investment to be no less than $25,000 for each of a total of forty (60) but not less than twenty (20) MTC CP. Shares. Each non-interest bearing convertible preferred share on conversion equal to (100,000 shares of unregistered MTC common valued at $.25 cents per share). NOTE: The execution and delivery of, and the performance by the Company of its obligations under, the subscription agreements and PPM documents, including the offer, issuance, sale and delivery of the non-interest bearing convertible preferred, are within the Company's corporate power, (The issuer has 50,000 Preferred shares authorized with none outstanding as of this date except for the sixty to be issued as a result of this transaction), have been duly authorized by all necessary corporate action, do not require approval of any government body, agency or official and do not and will not, conflict with, violate or contravene, or constitute a default under, any applicable law or regulation, but will require corporate action as follows: Assuming a total of $1.5 Million dollars invested, the Company on conversion of all sixty MTC CP shares will be obligated to issue a total of six million shares which will require the Company's best efforts, without guarantee of shareholder approval, in conducting a timely shareholder meeting and securing the approval for an appropriate increase in the NJ Article/Certificate of Incorporation authorized Common shares increase from 40 million to 200 million. Common shares outstanding of the Company's most recent 10-Q see EDGAR SEC filings dated Oct 14, 2003 was: 39,372,753 1 NOTICE THIS INVESTMENT INVOLVES A HIGH DEGREE OF RISK (SEE RISK FACTORS) AND IS SUITABLE ONLY FOR THOSE PERSONS WHO CAN MEET MINIMUM INVESTOR SUITABILITY STANDARDS (SEE TERMS OF OFFERING). THE UNITS ARE NOT READILY TRANSFERABLE AND SHOULD ONLY BE PURCHASED FOR LONG-TERM INVESTMENT. ACCORDINGLY, EACH INVESTOR MUST DEMONSTRATE THAT HE HAS THE ABILITY TO EVALUATE THIS OFFERING. PROSPECTIVE INVESTORS ARE NOT TO CONSTRUE THE CONTENTS OF THIS MEMORANDUM AS LEGAL OR BUSINESS ADVICE. EACH INVESTOR SHOULD CONSULT HIS PERSONAL COUNSEL, ACCOUNTANT, AND OTHER ADVISORS AS TO LEGAL, ECONOMIC AND RELATED, MATTERS CONCERNING THE INVESTMENT DESCRIBED HEREIN AND ITS SUITABILITY FOR HIM/HER THE COMPANY SHALL MAKE AVAILABLE TO EACH INVESTOR, OR HIS AGENT, DURING THIS OFFERING AND PRIOR TO THE SALE OF ANY UNITS, THE OPPORTUNITY TO ASK QUESTIONS OF AND RECEIVE ANSWERS FROM THE COMPANY CONCERNING ANY ASPECT OF THE INVESTMENT AND TO OBTAIN ANY ADDITIONAL INFORMATION NECESSARY TO VERIFY THE ACCURACY OF THE INFORMATION CONTAINED IN THESE MEMORANDUM, TO THE EXTENT THE COMPANY POSSESS SUCH INFORMATION OR CAN ACQUIRE IT WITHOUT UNREASONABLE EFFORT OR EXPENSE. SALES OF THESE UNITS CAN BE CONSUMMATED ONLY BY THE COMPANY'S ACCEPTANCE OF OFFERS BY PROSPECTIVE INVESTORS. THIS MEMORANDUM CONSTITUTES SUCH A SOLICITATION FOR AN OFFER ONLY IF THE PROSPECTIVE INVESTOR'S NAME APPREARS ON THE COVER PAGE THE UNITS ARE OFFERED SUBJECT TO PRIOR SALE, WHEN, AS, AND IF DELIVERED TO AND ACCEPTED BY THE COMPANY AND SUBJECT TO APPROVAL OF CERTAIN LEGAL MATTERES BY COUNSEL AND CERTAIN OTHER CONDITIONS. THE COMPANY RESERVES THE RIGHT TO REJECT ANY SUBSCRIPTIONS IN WHOLE OR PART. SALES BY THE COMPANY OF THE UNITS ARE MADE IN RELIANCE ON EXEMPTIONS FROM REGISTRATION CONTAINED IN THE SECURITIES ACT OF 1933, AS AMENDED, THE RULES AND REGULATIONS PROMULGATED THEREUNDER AND APPLICABLE STATE SECURITIES LAWS. THE UNITS HAVE NOT BEEN REGISTERED UNDER THE SAID ACT OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION, AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF BY AN INVESTOR UNLESS SO REGISTERED, OR UNLESS IN THE OPINION OF COUNSEL FOR THE COMPANY SUCH REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR ANY SAID LAW. ACCORDINGLY THE TRANSFERABILITY OF THE UNITS IS SEVERELY LIMITED. NO MARKET MAY DEVELOP FOR THE UNITS, UNITS NEEDING LIQUIDITY SHOULD NOT BE PURCHASED BECAUSE SUCH INVESTORS MAY BE UNABLE TO LIQUIDATE THEIR INVESTMENT QUICKLY OR ON ACCEPTABLE TERMS, IF AT ALL, IF THEY DESIRE TO DO SO (SEE RISK FACTORS) NOTICE TO CONNECTICUT RESIDENTS THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE BANKING COMMISSIONER OF THE STATE OF CONNECTICUT NOR HAS THE COMMISSIONER PASSED UPON THE ACCURACY OR ADEQUACY OF THIS OFFERING. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL THE UNITS HAVE NOT BEEN REGISTERED UNDER SECTION 36-485 OF THE CONNECTICUT UNIFORM SECURITIES ACT BUT WILL BE SOLD IN RELIANCE ON THE EXEMPTION OF SUCH REGISTRATION SET FORTH IN SECTIONS 36-490(b)(9)(A) OF SAID ACT AND REGULATIONS PROMULGATED THEREUNDER. THE SAID SHARES CANNOT BE RESOLD WITHOUT REGISTRATION UNDER SECTION 36-485 OF SAID ACT OR AN EXCEPTION FROM REGISTRATION PURSUANT TO SECTION 36-490 OF SAID ACT. NOTICE TO FLORIDA RESIDENTS THE SECURITIES REFERRED TO IN THIS MEMORANDUM WILL BE SOLD TO, AND ACQUIRED BY, 2 THE HOLDER IN A TRANSACTION EXEMPT UNDER SECTION 517.061 OF THE FLORIDA SECURITIES ACT. THE SECURITIES HAVE NOT BEEN REGISTERED UNDER SUCH ACT IN THE STATE OF FLORIDA AND, UNLESS THE SECURITIES ARE REGISTERED, THEY MAY NOT BE OFFERED FOR SALE OR RESOLD UNLESS THEY ARE REGISTERED OR UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE. IN ADDITION FLORIDA RESIDENTS SHALL HAVE THE PRIVILEDGE OF VOIDING THE PURCHASE WITHIN 3 DAYS OF THEIR TENDERING OF ANY CONSIDERATION FOR THEIR PURCHASE OR THEIR RECEIVING NOTICE OF SUCH PRIVILEDGE WHICHEVER OCCURS LATER TO ACCOMPLISH THE FOREGOING, THE SUBSCRIBER NEED ONLY SEND A LETTER OR TELEGRAM TO THE COMPANY INDICATING HIS INTENTION TO WITHDRAW. THE LETTER OR TELEGRAM SHOULD BE SENT AND POSTMARKED PRIOR TO THE END OF THE AFOREMENTIONED THIRD DAY. IF THE SUBSCRIBER SENDS A LETTER IT IS PRUDENT TO SEND IT BY CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO ENSURE THAT IT IS RECEIVED AND ALSO TO EVIDENCE THE TIME WHEN IT WAS MAILED. NOTICE TO NEW JERSEY RESIDENTS THIS CONFIDENTIAL PRIVATE PLACEMENT MEMORANDUM HAS NOT BEEN FILED WITH OR REVIEWED BY THE NEW JERSEY BUREAU OF SECURITIES OR THE DEPARTMENT OF LAW AND PUBLIC SAFETY OF THE STATE OF NEW JERSEY PRIOR TO ITS ISSUANCE AND USE. NEITHER THE ATTORNEY GENERAL, OR THE STATE OF NEW JERSEY NOR THE BUREAU OF SECURITIES HAS PASSED ON OR ENDORSED THE MERITS OF THIS MEMORANDUM, OR THE PRIVATE OFFERING CONTAINED HEREIN. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL. NOTICE TO NEW YORK RESIDENTS THIS CONFIDENTIAL PRIVATE PLACEMENT MEMORANDUM HAS NOT BEEN FILED WITH OR REVIEWED BY THE ATTORNEY GENERAL OF THE STATE OF NEW YORK PRIOR TO ITS ISSUANCE AND USE. THE ATTORNEY GENERAL, OF THE STATE OF NEW YORK HAS PASSED ON OR ENDORSED THE MERITS OF THIS MEMORANDUM, OR THE PRIVATE OFFERING CONTAINED HEREIN. ANY REPRESENTATIONS TO THE CONTRARY ARE UNLAWFUL. The minimum subscription is $25,000 for one share of Mediscience non-interest bearing preferred. You should pay by check, money order or wire transfer payable to "Mediscience Technology Corp. for deposit only to /Solomon Smith Barney Account No 715-17097 Corporate Account." If the Company rejects your subscription in whole, the Company will return this Agreement and your payment. If the Company accepts your subscription in whole or in part, a copy of this Agreement will be returned to you as your receipt. This will confirm your subscription and indicate how much of your subscription the Company has accepted. All proceeds of the Offering will be held in an a Mediscience Corporate Account at Solomon Smith Barney Account No. 715-17097 When the Company sells its Minimum Subscription, the funds held in the Solomon Smith Barney Corporate Account will be disbursed to the Company and non-interest bearing convertible preferred share certificates will be issued through MTC's transfer agent Registrar and Transfer Co. One Mediscience Technology Corp. non-interest bearing convertible preferred share certificate for each $25,000 dollars invested. If the Company accepts only part of your subscription, the Company will return the unused portion of your payment to you with interest, if any. If the Minimum Subscription is not sold or waived by Mediscience prior to the Termination Date of the Offering, then all deposits will be returned to subscribers with interest earned, if any. 3 You irrevocably submit this Agreement for the purchase of _____ Mediscience Technology non-interest bearing convertible preferred stock certificates at $25,000 per Share. With this Agreement, you also submit payment in the amount of $________ __ ($25,000 per Share) for the Share/s subscribed. In connection with this investment, you represent to the Company that: a. Before submitting payment for the Shares, you received the Company's Disclosure Document (including SEC 10-K 2003), and have reviewed all Mediscience Technology 10-QSB filings to date January 13, 2004 b. You are a resident of ______________,____________. (State) (Country) (If the Offering has not been qualified or registered in that jurisdiction or is not exempt from the registration requirements in that jurisdiction, your subscription will not be accepted.) c. The Social Security number or taxpayer identification number that you included in this Agreement is your true, correct and complete identification number. d. You are not subject to backup withholding of interest or dividends by the Internal Revenue Service. The Shares should be registered as follows: Name: _________________________________________ As (check one): ___ Individual ___ Tenants-in-Common ___ Partnership ___ Joint Tenants ___ Corporation ___ Trust ___ Minor with adult custodian ___ Other Under the Uniform Gift to Minors Act Individual(s) Registration: ______________________________________ ____________________________________ Investor No. 1 (print name above) Investor No. 2 (print name above) ______________________________________ ____________________________________ Street (residence address) Street (residence address) 4 ______________________________________ ____________________________________ City State Zip City State Zip ______________________________________ ____________________________________ Home Phone Home Phone ______________________________________ ____________________________________ Social Security Number Social Security Number ______________________________________ ____________________________________ Date of Birth Date of Birth ______________________________________ ____________________________________ Signature Signature ______________________________________ ____________________________________ Date Date Entity (Not Individual) Registration: On behalf of the entity named below, you represent that you have full power and authority to execute this Agreement. You also represent that investment in the Company is not prohibited by any of the governing documents of the entity. Name of Entity By: __________________________________ ____________________________________ Signature of trustee, partner or Date authorized officer Title:________________________________ ______________________________________ ____________________________________ Street Address Taxpayer ID Number ______________________________________ ____________________________________ City State Zip Telephone 5 ACCEPTED BY MEDISCIENCE TECHNOLOGY CORP. FOR ______ SHARE/S OF MEDISCIENCE TECHNOLOGY CORP. non-interest bearing convertible preferred, with each individual dollar investment to be no less than $25,000 for each of a total of forty (60) but not less than twenty (20) MTC non-interest bearing convertible preferred shares. Each non-interest bearing convertible preferred share equal to (100,000 shares of unregistered MTC common on conversion valued at $.25 cents per share). By: __________________________________ Date:___________________________ Title: Chairman/CEO Mediscience Technology Corp. Cherry Hill NJ 6 THE OFFERING Amount of Investment: Up to an aggregate of $1,500,000 offered to outside Investors. Type of Security: Callable, non-interest bearing Convertible Preferred shares, with investment to be no less than $25,000 for each share convertible at the discretion of the company into 100,000 shares of Mediscience common. ("The "Offering"). Number of Units Offered: Up to 60 Units. The Units are being offered on a "best efforts - all or none" as to 20 Units and a "best efforts" basis as to the remaining 20 Units. Price Per Unit: $25,000 ("Purchase Price"). Minimum Proceeds: $500,000. Valuation of the Company: Pre-Money $12,000,000 @ $.30 cents per share Post-Money $15,000,000+ assuming $.30 cents per share Capitalization of the o Mediscience Technology Corp. Company: ("MDSC) currently owns 100% of all Preferred shares, of the Company. (50,000 authorized 10-K 2003) o After proposed financing MDSC would retain 49,940 while investors will own 60, if all 60 Units are sold. Rights, Preferences, Privileges Description: MTC management can at any and Restrictions: time and for any reason immediately after the next MTC shareholder meeting without notice to the investor convert all 60 MTC CP shares issued into a total of SIX Million MTC common or 100,000 shares on each of the 60 MTC CP shares. On such event MTC will deliver the MTC common to each investor through MTC agent Registrar and Transfer Co. canceling the converted MTC CP as a matter of record. (Callable non-interest bearing Convertible Preferred shares, with investment to be no less than $25,000 for each share convertible at the SOLE discretion of the company into 100,000 shares of Mediscience common. ("The "Offering") (1) Liquidation Preference and Dissolution Rights: In the event of any liquidation of the Company, the Unit holders shall be entitled to receive, as a preference to the holders of MTC Common Shares, an amount ("Liquidation Preference") equal to the Original Purchase Price only. The close of a transaction or series of transactions in which more than 80% of the voting power of the Company is disposed of to a single person or group of affiliated persons, or the consolidation or merger of the Company with or into any other corporation or corporations, or the sale of all or substantially all of its assets shall be deemed to be a liquidation. I Transfer Restrictions: none The Series A are transferable. Right of First Offer: In the event MTC offers another PPM Unit, each investor of this PPM shall have the opportunity to purchase a pro rata percentage of Units in the new offering, based on the holder's percentage ownership interest in the Company. This right is not transferable. Use of Proceeds: The proceeds from the sale of the Series A Units will be used, at the discretion of the Company's management, to fund the following activities: -------------------------------------------------------- Recruit/Retain Management and Staff $ 250,000 -------------------------------------------------------- Clinical Development of PhotonX(TM) {Cervical) $ 200,000 -------------------------------------------------------- PhotonX(TM) (Cervical, etc.) Prototypes $ 200,000 -------------------------------------------------------- Regulatory, Medical and Scientific $ 200,000 Affairs -------------------------------------------------------- Market Research: The Adoption Equation $ 100,000 -------------------------------------------------------- Other Working Capital & Closing Fees $ 550,000 -------------------------------------------------------- TOTAL $1,500,000 --------------------------------------------------------
Risk Factors: The Units are speculative and involve a high degree of risk. Only those investors who can bear the risk of loss of their entire investment should invest. Investment Risk Factors are profiled in the Confidential Investment Summary and/or Private Placement Memorandum distributed to each Investor. Investor Suitability: The Units are suitable for those investors whose business and investment experience, either alone or together with an experienced advisor, makes them capable of evaluating the merits and risks of a potential investment in the Company and who can afford the loss of their entire investment and have no need for liquidity in their investment. Expenses: The Company and the Investors shall each be responsible for their own expenses in connection with this Unit financing. Closing: An initial closing shall be held following receipt into escrow of the Minimum Proceeds and additional closings shall be held thereafter during the offering period as subscriptions for at least $100,000 are received and cleared in the escrow account. The Final Closing is expected to occur no later than January 15, 2003, unless extended at the discretion of Mediscience Technology ("Placement Agent") in 30 day increments. The closing of the transaction, if all conditions are met, is expected to occur on or before February 1st, 2004 (the "Closing Date"). Capital contributions accepted prior to closing will be deposited in an interest-bearing escrow account at Solomon Smith Barney administered by Peter Katevatis Esq. Counsel to the Company. Conditions of Closing: The closing for the purchase and sale of the Units will be conditioned upon execution of final, binding agreements in compliance with applicable securities laws. Investment Banker to the THM Group, LLC 161 North Franklin Turnpike, Company: Suite 204 Ramsey, New Jersey 07446 USA Phone: (201) 818-0050 Fax: (201) 825-3178 Email: mengelhart@thmgroupllc.com Attn: Michael W. Engelhart Shelf Registration It is understood and agreed that MTC will file an SEC resale shelf registration S-3 for no less than four million shares within a period of 6 months or sooner. Associate Counsel to the Warshaw Burstein Cohen Schlesinger & Company: Kuh, LLP 555 Fifth Avenue, 11th Floor Attn Peter Hirshfield Esq. New York, New York 10017 USA Phone: (212) 984-7836 Fax: (646) 349-1665 Email: phirshfield@wbcsk.com Forward-Looking Statements All statements other than statements of historical fact included in this Memorandum, including, without limitation, statements under "Risk Factors" and "Business" regarding our anticipated financial position, business strategy and plans and objectives of our management for future operations, are forward-looking statements. When used in this Memorandum, words such as "anticipate," "believe," "estimate," "plans," "expect," "intend" and similar expressions, as they relate to Mediscience Technology Corp. or the management of the corporate organization, identify forward-looking statements. Any forward-looking statements are based on the beliefs of our management as well as assumptions made by and information currently available to our management. Actual results could differ materially from those contemplated by the forward- looking statements as a result of certain factors, such as those disclosed under "Risk Factors," including, but not limited to, our plans to develop our PhotonX(TM) products, engage in pre-clinical testing and clinical trials, seek FDA approval, develop manufacturing/marketing alliances, pricing pressures, finance and administrative functions, competitive factors and, changes in legal and regulatory requirements, general economic conditions and our planned use of the proceeds of this Offering. Any forward-looking statements reflect our current views with respect to future events and are subject to these and other risks, uncertainties and assumptions relating to our operations, results of operations, growth strategy and liquidity. All subsequent written and oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by this paragraph. 9 MEDISCIENCE TECHNOLOGY CORP. ACCREDITED INVESTOR SUITABILITY QUESTIONNAIRE THIS QUESTIONNAIRE IS TO BE COMPLETED AND DELIVERED TO MEDISCIENCE TECHNOLOGY CORP. WITH THE DELIVERY OF A SUBSCRIPTION AGREEMENT INSTRUCTIONS: If the answer to any questions is "None" or "Not Applicable", please state so. Your answers will, at all times, be kept strictly confidential; however, each organization which agrees to purchase any Units of the Company and agrees that the Company may present this Questionnaire to such persons as they deem appropriate in order to insure themselves that the offer and sale of Units of the Company (sometimes referred to as the "CP") to you will not result in violation of the exemption from registration under the Securities Act of 1933, as amended, and the securities laws of certain states, which is being relied upon by the Company in connection with the sale. (Print or type your responses) 1. Name: ____________________________________________________________________ Date of birth or year of organization: ___________________________________ 2. Home address or, of other than an individual, principal office address:___ 10 _______________________________________________________________________ _______________________________________________________________________ 3. I am subscribing for __________ Units. 4.* Employer:_________________________________________________________________ Nature of Business:_______________________________________________________ Position:_________________________________________________________________ Nature of duties:_________________________________________________________ Business address:_________________________________________________________ Business telephone number:________________________________________________ 5. In the case of any individual investor, I am an accredited investor (as defined in Rule 501 of Regulation D) because I certify that (check each appropriate description): * This question is to be answered if the investor is an individual. (a) _____ I am a natural person whose individual net worth, or joint net worth with my spouse, exceeds $1,000,000.(1) (b) _____ I am a natural person who had individual income exceeding $200,000 in 2001 and 2002 and I have a reasonable expectation of reaching the same income level in 2003.(2) (c) _____ I am a natural person who had joint income with my spouse exceeding $300,000 in 2001 and 2002 and I have a reasonable expectation of reaching the same income level in 2003, as defined above. (d) _____ I am a director or executive officer of the Company. (Executive officer means the president, any vice president in charge of a principal business unit, division or function, such as sales, administration or finance, or any other person who persons similar policy-making functions for the Company.) - ---------- (1) For purposes of this item, "individual net worth" means the excess of total assets at fair market value, including home and personal property (and including property owned by a spouse), over total liabilities. (2) For purposes of this questionnaire, "individual income" means individual annual adjusted gross income, as reported for Federal income tax purposes, plus (i) the amount of any tax-exempt interest income received, (ii) the amount of losses claimed as a limited partner in a limited partnership, (iii) any deduction claimed for depletion, (iv) amounts contributed to an IRA or Keogh retirement plan, (v) alimony paid and (vi) any amount by which income from long-term capital gains has been reduced in arriving at adjusted gross income pursuant to the provisions of Section 1202 of the Internal Revenue Code of 1986, as amended. 2-B 6. In the case of any partnership, corporation, trust and other entity investor, the undersigned certifies (check one): (a)(3)______ The investor certifies that each equity owner of the investor is an accredited investor and that each such equity owner has completed an Accredited Investor Suitability Questionnaire certifying that he, she or it meets one of the following five conditions of accreditation: (i) The equity owner of the investor is a natural person who had an individual income (exclusive of any income attributable to his or her spouse) in excess of $200,000 (or joint income with that of his spouse in excess of $300,000) in each of 2001 and 2002 and reasonably and fully expects to have an individual income in excess of $200,000 (or joint income with that of his spouse in excess of $300,000) in 2003. "Individual income" is defined in item 5(b) above; (ii) The equity owner is a natural person who has an "individual net worth" (or who, with his or her spouse has a combined individual net worth) in excess of $1,000,000. "Individual net worth" is defined in item 5(a) above; (iii) The equity owner is, or is a director or executive officer of, the Company; (iv) The equity owner is either (i) a bank as defined in Section 3(a)(2) of the Act whether acting in its individual or fiduciary capacity; (ii) an insurance company as defined in Section 2(13) of the Act; (iii) an investment company registered under the Investment Company Act of 1940 or a business development company as defined in Section 2(a)(48) of that Act; (iv) a Small Business Investment Company licensed by the U.S. Small Business Administration under Section 301(c) or (d) of the Small Business Investment Act of 1958; or (v) an employee benefit plan within the meaning of Title I of the Employee Retirement Income Security Act of 1974, if the investment decision is made by a plan fiduciary, as defined in Section 3(21) of such Act, which such plan fiduciary is either a bank, insurance company, or registered investment adviser, or if the employee benefit plan has total assets in excess of $5,000,000; or (v) The equity owner is a private business development company as defined in Section 202(a)(22) of the Investment Advisers Act of 1940. (b)______ The investor certifies that it is either (a) a bank as defined in Section 3(a)(2) of the Act whether acting in its individual or fiduciary capacity; (b) an insurance company as defined in Section 2(13) of the Act; (c) an investment company registered under the Investment Company Act of 1940 or a business development company as defined in Section 2(a)(48) of such Act; (d) a Small Business Investment Company licensed by the U.S. Small Business Administration under Section 301 (c) or (d) of the Small Business Investment Act of 1958; or (e) an employee benefit plan within the meaning of Title I of the Employee Retirement Income Security Act of 1974, if the investment decision is made by a plan fiduciary, as defined in Section 3(21) of such Act, and the plan fiduciary is either a bank, insurance company or registered investment adviser, or if the employee benefit plan has total assets in excess of $5,000,000. - ---------- (3) An investor initialing this paragraph must provide a questionnaire from each of its equity owners. If the investor is a trust, only a trust which is revocable and which may be amended at the sole discretion of its grantor is eligible to qualify as an accredited investor under this item 6(a). The grantors of the trust are deemed to be the equity owners of the trust and each grantor must provide a questionnaire. 12 (c)______ The investor certifies that it is a private business development company as defined in Section 202(a)(22) of the Investment Advisers Act of 1940. (d)______ The investor certifies that the investor is an organization described in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended, not formed for the specific purpose of acquiring Securities with total assets exceeding $5,000,000. (e)______ The investor certifies that the investor is a corporation, Massachusetts or similar business trust or partnership, not formed for the specific purpose of acquiring Securities with total assets exceeding $5,000,000. (f)______ The investor certifies that the investor is a trust, not formed for the specific purpose of acquiring Securities, with total assets exceeding $5,000,000 and whose purchase is directed by a "sophisticated person", as defined in Rule 506(b)(2)(ii) of Regulation D. The undersigned certifies that the foregoing responses are true, complete and accurate to the best of the undersigned's knowledge and belief. The undersigned will provide such further information as may be requested by the Company to verify this response. The undersigned will notify the Company in writing regarding any material change to this response prior to the closing of the purchase of the Securities. Absent such notification, the issuance of Securities in the name of the undersigned shall be deemed to be an automatic affirmation by the undersigned of the truth and accuracy of the statements and information set forth above. ________________ ________________________________________________ Date Type or Print Name of Prospective Investor ________________________________________________ Signature of Prospective Investor 4-B EX-5 12 exhibit5.txt EXHIBIT 5 OLSHAN GRUNDMAN FROME ROSENZWEIG & WOLOSKY LLP PARK AVENUE TOWER, 65 EAST 55TH STREET NEW YORK, NEW YORK 10022 (212) 451-2300 FACSIMILE (212) 451-2222 www.ogfrwlaw.com NEW JERSEY OFFICE 2001 ROUTE 46, SUITE 202 PARSIPPANY, NEW JERSEY 07054 (973)335-7400 FACSIMILE (973)335-8018 July 30, 2004 Mediscience Technology Corp. 1235 Folkstone Way Cherry Hill, NJ 08034 Re: Mediscience Technology Corp. --------------------------- Gentlemen: We have acted as counsel to Mediscience Technology Corp., a New Jersey Corporation (the "Company"), in connection with its registration statement on Form S-3 (the "Registration Statement") being filed with the Securities and Exchange Commission under the Securities Act of 1933 (the "Act") for the registration for resale by the selling shareholders listed therein (the "Selling Shareholders") of 8,075,000 shares of the Company's common stock ("Common Stock") par value $.01 per share (the "Shares"). In connection with the foregoing, we have examined originals or copies, satisfactory to us, of (i) the Company's Certificate of Incorporation and By-laws, each as amended to date, and (ii) resolutions adopted by the Company's Board of Directors authorizing the issuance of the Common Stock and the Shares. We have also reviewed such other matters of laws and examined and relied upon all such corporate documents, certificates, agreements, instruments and records, as we have deemed necessary for the purpose of expressing an opinion as set forth below. Our opinion with respect to the valid issuance of an aggregate of 8,075,000 Shares owned by the Selling Shareholders which are being registered by the Company pursuant to the Registration Statement is made solely in reliance on the Company's transfer agent's records and a certificate from an authorized officer of the Company. In our examinations we have assumed the genuineness of all signatures, the authenticity of all documents and instruments submitted to us as originals or copies, and the conformity of any copies to the originals. Based upon and subject to the foregoing, we are of the opinion that the Shares have been validly issued and are fully paid and non-assessable. We consent to the filing of this opinion as an exhibit to the Registration Statement and to the reference made to our firm under the caption "Legal Matters" in the Prospectus. We advise you that a member of this firm is a shareholder of the Company. Very truly yours, /s/ Olshan Grundman Frome Rosenzweig & Wolosky LLP -------------------------------------------------- Olshan Grundman Frome Rosenzweig & Wolosky LLP EX-23.1 13 ex23-1.txt EXHIBIT 23.1 Consent of Independent Registered Public Accounting Firm We hereby consent to the incorporation by reference in this Registration Statement of Mediscience Technology Corp. (the "Company") on Form S-3, for the registration of 8,075,000 shares of common stock, of our report dated May 4, 2004 relating to the consolidated financial statements which appears in the Company's Annual Report on Form 10-KSB for the year ended February 29, 2004 which included an explanatory paragraph indicating that substantial doubt exists about the Company's ability to continue as a going concern. We also consent to the reference to us under the heading "Experts" in the prospectus, which is a part of the Registration Statement. /s/ Parente Randolph LLC - ------------------------ Parente Randolph LLC July 30, 2004 Philadelphia, Pennsylvania -----END PRIVACY-ENHANCED MESSAGE-----