UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13G
Under the Securities Exchange Act of 1934
(Amendment No. 1)
MEDICAL DISCOVERIES, INC.
(Name of Issuer)
Common Stock
(Title of Class of Securities)
58456E106
(CUSIP Number)
February 1, 2005
(Date of Event Which Requires Filing of this Statement)
|_| Rule 13d-1(b)
|X| Rule 13d-1(c)
|_| Rule 13d-1(d)
SCHEDULE 13G
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CUSIP No. 58456E106 Page 2 of 13 Pages
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1. NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS
Mercator Momentum Fund, Ltd. EIN:03-0021366
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |_|
(b) |X|
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3. SEC USE ONLY
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4. CITIZENSHIP OR PLACE OF ORGANIZATION
California
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NUMBER OF 5. SOLE VOTING POWER
SHARES 0
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BENEFICIALLY 6. SHARED VOTING POWER
OWNED BY 11,607,275
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EACH 7. SOLE DISPOSITIVE POWER
REPORTING 0
-----------------------------------------------------------------
PERSON 8. SHARED DISPOSITIVE POWER
WITH 11,607,275
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9. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11,607,275
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10. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES
|_|
--------------------------------------------------------------------------------
11. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9)
9.99%
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12. TYPE OF REPORTING PERSON
PN
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SCHEDULE 13G
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CUSIP No. 58456E106 Page 3 of 13 Pages
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1. NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS
Mercator Momentum Fund III, Ltd. EIN:32-0056070
--------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |_|
(b) |X|
--------------------------------------------------------------------------------
3. SEC USE ONLY
--------------------------------------------------------------------------------
4. CITIZENSHIP OR PLACE OF ORGANIZATION
California
--------------------------------------------------------------------------------
NUMBER OF 5. SOLE VOTING POWER
SHARES 0
-----------------------------------------------------------------
BENEFICIALLY 6. SHARED VOTING POWER
OWNED BY 11,607,275
-----------------------------------------------------------------
EACH 7. SOLE DISPOSITIVE POWER
REPORTING 0
-----------------------------------------------------------------
PERSON 8. SHARED DISPOSITIVE POWER
WITH 11,607,275
--------------------------------------------------------------------------------
9. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11,607,275
--------------------------------------------------------------------------------
10. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES
|_|
--------------------------------------------------------------------------------
11. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9)
9.99%
--------------------------------------------------------------------------------
12. TYPE OF REPORTING PERSON
PN
--------------------------------------------------------------------------------
-3-
SCHEDULE 13G
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CUSIP No. 58456E106 Page 4 of 13 Pages
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1. NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS
Monarch Pointe Fund, Ltd.
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |_|
(b) |X|
--------------------------------------------------------------------------------
3. SEC USE ONLY
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4. CITIZENSHIP OR PLACE OF ORGANIZATION
British Virgin Islands
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NUMBER OF 5. SOLE VOTING POWER
SHARES 0
-----------------------------------------------------------------
BENEFICIALLY 6. SHARED VOTING POWER
OWNED BY 11,607,275
-----------------------------------------------------------------
EACH 7. SOLE DISPOSITIVE POWER
REPORTING 0
-----------------------------------------------------------------
PERSON 8. SHARED DISPOSITIVE POWER
WITH 11,607,275
--------------------------------------------------------------------------------
9. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11,607,275
--------------------------------------------------------------------------------
10. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES
|_|
--------------------------------------------------------------------------------
11. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9)
9.99%
--------------------------------------------------------------------------------
12. TYPE OF REPORTING PERSON
PN
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-4-
SCHEDULE 13G
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CUSIP No. 58456E106 Page 5 of 13 Pages
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1. NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS
M.A.G. Capital, LLC EIN: 300021359
--------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |_|
(b) |X|
--------------------------------------------------------------------------------
3. SEC USE ONLY
--------------------------------------------------------------------------------
4. CITIZENSHIP OR PLACE OF ORGANIZATION
California
--------------------------------------------------------------------------------
NUMBER OF 5. SOLE VOTING POWER
SHARES 0
-----------------------------------------------------------------
BENEFICIALLY 6. SHARED VOTING POWER
OWNED BY 11,607,275, some of which are held by Mercator Momentum Fund
and Mercator Momentum Fund III (together, the "Funds"), some
of which are owned by Monarch Pointe Fund, Ltd. ("MPF"), and
some of which are owned by M.A.G. Capital, LLC ("MAG"). MAG
is the general partner of the Funds and controls the
investments of MPF.
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EACH 7. SOLE DISPOSITIVE POWER
REPORTING 0
-----------------------------------------------------------------
PERSON 8. SHARED DISPOSITIVE POWER
WITH 11,607,275, some of which are held by the Funds, some by MPF
and some by MAG.
--------------------------------------------------------------------------------
9. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11,607,275
--------------------------------------------------------------------------------
10. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES
|_|
--------------------------------------------------------------------------------
11. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9)
9.99%
--------------------------------------------------------------------------------
12. TYPE OF REPORTING PERSON
IA
--------------------------------------------------------------------------------
-5-
SCHEDULE 13G
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CUSIP No. 58456E106 Page 6 of 13 Pages
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1. NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS
David F. Firestone
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |_|
(b) |X|
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3. SEC USE ONLY
--------------------------------------------------------------------------------
4. CITIZENSHIP OR PLACE OF ORGANIZATION
USA
--------------------------------------------------------------------------------
NUMBER OF 5. SOLE VOTING POWER
SHARES 0
-----------------------------------------------------------------
BENEFICIALLY 6. SHARED VOTING POWER
OWNED BY 11,607,275, all of which are held by the Funds, MPF and MAG.
David F. Firestone is Managing Member of MAG.
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EACH 7. SOLE DISPOSITIVE POWER
REPORTING 0
-----------------------------------------------------------------
PERSON 8. SHARED DISPOSITIVE POWER
WITH 11,607,275, all of which are held by the Funds, MPF and MAG.
David F. Firestone is Managing Member of MAG.
--------------------------------------------------------------------------------
9. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11,607,275
--------------------------------------------------------------------------------
10. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES
|_|
--------------------------------------------------------------------------------
11. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9)
9.99%
--------------------------------------------------------------------------------
12. TYPE OF REPORTING PERSON
IN
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-6-
SCHEDULE 13G
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CUSIP No. 58456E106 Page 7 of 13 Pages
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This statement is hereby amended and restated in its entirety as follows:
Item 1. Issuer.
(a) The name of the issuer is Medical Discoveries, Inc. (the "Issuer").
(b) The address of the Issuer's principal executive office is 738
Aspenwood Lane, Twin Falls, Idaho 83301.
Item 2. Reporting Person and Security.
(a) Mercator Momentum Fund, L.P. ("Momentum Fund") and Mercator Momentum
Fund III, L.P. ("Momentum Fund III" and, with Momentum Fund, the "Funds") are
private investment limited partnerships organized under California law. The
general partner of each of the Funds is M.A.G. Capital, LLC ("MAG"), a
California limited liability company. David F. Firestone is the Managing Member
of MAG. Monarch Pointe Fund, Ltd. ("MPF") is a corporation organized under the
laws of the British Virgin Island. MAG controls the investments of MPF. The
Funds, MPF, MAG and David F. Firestone are referred to herein as the "Reporting
Persons."
(b) The business address of each of the Funds, MAG and David F. Firestone
is 555 S. Flower Street, Suite 4200, Los Angeles, CA 90071. The business address
of MPF is c/o Bank of Ireland Securities Services, Ltd., New Century House,
International Financial Services Center, Mayor Street Lower, Dublin 1, Republic
of Ireland.
(c) Each of the Funds is a California limited partnership. MAG, their
general partner, is a California limited liability company. MPF is a corporation
organized under the laws of the British Virgin Islands.
(d) The title of the class of securities to which this statement relates
is the common stock of the Issuer, no par value per share (the "Common Stock").
(e) The CUSIP number is 58456E106.
Item 3. If This Statement is Filed Pursuant to Rule 13d-1(b) or 13d-2(b) or (c),
Check Whether the Person Filing is a:
(a) |_| Broker or dealer registered under Section 15 of the Act (15 U.S.C.
78o).
(b) |_| Bank as defined in Section 3(a)(6) of the Act (15 U.S.C. 78c).
(c) |_| Insurance company as defined in Section 3(a)(19) of the Act (15
U.S.C. 78c).
(d) |_| Investment company registered under Section 8 of the Investment
Company Act of 1940 (15 U.S.C. 80a-8).
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SCHEDULE 13G
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CUSIP No. 58456E106 Page 8 of 13 Pages
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(e) |_| An investment adviser in accordance with ss.
240.13d-1(b)(1)(ii)(E).
(f) |_| An employee benefit plan or endowment fund in accordance with ss.
240.13d-1(b)(1)(ii)(F).
(g) |_| A parent holding company or control person in accordance with ss.
240.13d-1(b)(1)(ii)(G).
(h) |_| A savings association as defined in Section 3(b) of the Federal
Deposit Insurance Act (12 U.S.C. 1813).
(i) |_| A church plan that is excluded from the definition of an
investment company under Section 3(c)(14) of the Investment Company Act of 1940
(15 U.S.C. 80a-3).
(j) |_| Group, in accordance with ss. 240.13d-1(b)(1)(ii)(J).
Not Applicable.
Item 4. Ownership.
On October 18, 2004, MPF acquired 12,000 shares of the Series A
Convertible Preferred Stock of the Issuer ("Series A Shares") at $100 per share.
In the same transaction, MPF and MAG acquired warrants (the "October Warrants")
to purchase 3,660,396 and 915,099 shares of Common Stock of the Issuer,
respectively.
As of February 1, 2005: (i) MPF owned 12,000 Series A Shares; (ii) MPF and
MAG held Warrants to purchase 3,660,396 and 915,099 shares of Common Stock,
respectively; and (iii) MPF and MAG owned no shares of Common Stock.
On February 1, 2005, Momentum Fund and Momentum Fund III acquired 17,750
Series A Shares and 12,250 Series A Shares, respectively, at $100 per share. In
the same transaction, Momentum Fund, Momentum Fund III and MAG acquired warrants
(the "February Warrants") to purchase 6,748,856, 4,689,883 and 11,438,739 shares
of the Common Stock, respectively.
Each Series A Share is convertible into the number of shares of Common
Stock determined by dividing $100.00 by the Conversion Price at the time of
conversion. The Conversion Price is defined as 75% of the average of the lowest
three intra-day trading prices of the Common Stock during the 10 trading days
preceding the conversion, rounded to the nearest ten-thousandth; providing,
however, that the Conversion Price may not be more than $0.1967 adjusted for
stock splits and similar events.
The documentation governing the terms of the warrants and the Series A
Shares contains provisions prohibiting any exercise of the warrants or
conversion of Series A Shares that would result in the Reporting Persons owning
beneficially more than 9.99% of the outstanding shares of Common Stock as
determined under Section 13(d) of the Securities Exchange Act of 1934. The
-8-
SCHEDULE 13G
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CUSIP No. 58456E106 Page 9 of 13 Pages
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Reporting Persons have never had beneficial ownership of more than 9.99% of the
outstanding shares of Common Stock.
As of February 1, 2005, the Funds, MPF and MAG owned the following
securities of the Issuer:
Momentum Fund owned 17,750 Series A Shares and warrants to purchase up to
6,748,856 shares of Common Stock.
Momentum Fund III owned 12,250 Series A Shares and warrants to purchase up
to 4,689,883 shares of Common Stock.
MPF owned 12,000 Series A Shares and warrants to purchase up to 3,660,396
shares of Common Stock.
MAG owned warrants to purchase up to 12,353,838 shares of Common Stock.
David F. Firestone owned no securities of the Issuer directly.
The right to vote and the right to dispose of the shares beneficially
owned by Momentum Fund, Momentum Fund III and MPF are, in each case, shared
among either Momentum Fund, Momentum Fund III or MPF, as applicable, and both
MAG and David F. Firestone. The right to vote and the right to dispose of the
shares beneficially owned by MAG are shared by MAG and David F. Firestone.
Assuming that the Issuer had 104,581,669 shares of Common Stock
outstanding as of February 1, 2005, which is the number reported by the Issuer
as outstanding as of November 9, 2004 in its Quarterly Report on Form 10-QSB for
the quarter ended September 30, 2004, the individual Reporting Persons had
beneficial ownership of the following numbers of shares of Common Stock which
represented the following percentages of the Common Stock outstanding:
Shares Owned Percentage
------------ ----------
Momentum Fund 11,607,275 9.99%
Momentum Fund III 11,607,275 9.99%
MPF 11,607,275 9.99%
MAG 11,607,275 9.99%
David F. Firestone 11,607,275 9.99%
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SCHEDULE 13G
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CUSIP No. 58456E106 Page 10 of 13 Pages
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The percentages of the outstanding Common Stock held by the Reporting
Parties set forth above and on the cover pages to this report were determined
using a Conversion Price of $0.1375 with respect to the Series A Shares.
Item 5. Ownership of Five Percent or Less of a Class.
If this Schedule is being filed to report the fact that as of the date
hereof the Reporting Person has ceased to be the beneficial owner of more than
five percent of the class of securities, check the following [__]
Not Applicable.
Item 6. Ownership of More than Five Percent on Behalf of Another Person.
Not Applicable.
Item 7. Identification and Classification of the Subsidiary Which Acquired the
Security Being Reported on By the Parent Holding Company or Control
Person.
Not Applicable.
Item 8. Identification and Classification of Members of the Group.
Not Applicable.
Item 9. Notice of Dissolution of Group.
Not Applicable.
Item 10. Certifications.
By signing below I certify that, to the best of my knowledge and belief,
the securities referred to above were not acquired and are not held for the
purpose of or with the effect of changing or influencing the control of the
issuer of the securities and were not acquired and are not held in connection
with or as a participant in any transaction having that purpose or effect.
-10-
SCHEDULE 13G
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CUSIP No. 58456E106 Page 11 of 13 Pages
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: February 9, 2005 MERCATOR MOMENTUM FUND, L.P.
By: M.A.G. CAPITAL, LLC,
its general partner
By: /s/ Harry Aharonian
------------------------------------
Harry Aharonian, Portfolio Manager
Dated: February 9, 2005 MERCATOR MOMENTUM FUND III, L.P.
By: M.A.G. CAPITAL, LLC,
its general partner
By: /s/ Harry Aharonian
------------------------------------
Harry Aharonian, Portfolio Manager
Dated: February 9, 2005 MONARCH POINTE FUND, LTD.
By: /s/ Harry Aharonian
------------------------------------
Harry Aharonian, Director
Dated: February 9, 2005 M.A.G. CAPITAL, LLC
By: /s/ Harry Aharonian
------------------------------------
Harry Aharonian, Portfolio Manager
Dated: February 9, 2005
/s/ David F. Firestone
----------------------------------------
David F. Firestone
-11-
SCHEDULE 13G
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CUSIP No. 58456E106 Page 12 of 13 Pages
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EXHIBIT INDEX
Exhibit A Agreement of Joint Filing
-12-
SCHEDULE 13G
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CUSIP No. 58456E106 Page 13 of 13 Pages
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EXHIBIT A
AGREEMENT OF JOINT FILING
The undersigned hereby agree that they are filing jointly pursuant to Rule
13d-1 of the Securities Exchange Act of 1934 a report on Schedule 13G,
containing the information required by Schedule 13G, for shares of the common
stock of Medical Discoveries, Inc., beneficially owned by Mercator Momentum
Fund, L.P., Mercator Momentum Fund III, L.P., Monarch Pointe Fund, Ltd., M.A.G.
Capital, LLC and David F. Firestone and such other holdings as may be reported
therein.
MERCATOR MOMENTUM FUND, L.P.
By: M.A.G. CAPITAL, LLC,
its general partner
By: /s/ Harry Aharonian
----------------------------------
Harry Aharonian, Portfolio Manager
MERCATOR MOMENTUM FUND III, L.P.
By: M.A.G. CAPITAL, LLC,
its general partner
By: /s/ Harry Aharonian
----------------------------------
Harry Aharonian, Portfolio Manager
M.A.G. CAPITAL, LLC
By: /s/ Harry Aharonian
----------------------------------
Harry Aharonian, Portfolio Manager
MONARCH POINTE FUND, LTD.
By: /s/ Harry Aharonian
----------------------------------
Harry Aharonian, Director
/s/ David F. Firestone
--------------------------------------
David F. Firestone
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