[X]
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Quarterly
Report under Section 13 or 15 (d) of the
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|
Securities
Exchange Act of 1934
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||
For
the Quarterly Period Ended March 31, 2006
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||
[
]
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Transition
Report Pursuant to Section 13 or 15 (d) of the
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|
Securities
Exchange Act of 1934
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Commission
File Number: 0-11914
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||
CAPRIUS,
INC.
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||
(Exact
name of small business issuer as specified in its
charter)
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||
Delaware
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22-2457487
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(State
or other jurisdiction of
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(I.R.S.
Employer
|
|
incorporation
or organization)
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Identification
No.)
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One
University Plaza, Suite 400, Hackensack, NJ 07601
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||
(Address
of principal executive offices) (Zip Code)
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||
Issuer’s
telephone number: (201)
342-0900
N/A
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||
(Former
name, former address, and former fiscal year, if changed since last
report.)
|
Class
|
Outstanding
at May 11, 2006
|
Common
Stock Par value $0.01
|
3,321,673
shares
|
PART
I - FINANCIAL
INFORMATION
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|||
ITEM
1.
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|||
3
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|||
4
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|||
5
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|||
6
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|||
7
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|||
ITEM
2.
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10
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||
ITEM
3.
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13
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||
PART
II - OTHER INFORMATION
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|||
ITEM
1.
|
13
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||
ITEM
2.
|
13
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||
ITEM
6.
|
13
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||
14
|
ASSETS
|
||||
Current
Assets:
|
||||
Cash
and cash equivalents
|
$
|
2,417,383
|
||
Accounts
receivable, net of reserve for bad debts of $5,163
|
170,079
|
|||
Inventories,
net
|
783,061
|
|||
Other
current assets
|
87,010
|
|||
Total
current assets
|
3,457,533
|
|||
Property
and Equipment:
|
||||
Office
furniture and equipment
|
209,908
|
|||
Equipment
for lease
|
23,500
|
|||
Leasehold
improvements
|
20,970
|
|||
254,378
|
||||
Less:
accumulated depreciation
|
184,142
|
|||
Property
and equipment, net
|
70,236
|
|||
Other
Assets:
|
||||
Goodwill
|
737,010
|
|||
Intangible
assets, net of accumulated amortization of $870,917
|
169,083
|
|||
Other
|
20,566
|
|||
Total
other assets
|
926,659
|
|||
Total
Assets
|
$
|
4,454,428
|
||
LIABILITIES
AND STOCKHOLDERS’ EQUITY
|
||||
Current
Liabilities:
|
||||
Accounts
payable
|
$
|
125,572
|
||
Accrued
expenses
|
79,579
|
|||
Accrued
compensation
|
151,027
|
|||
Total
current liabilities
|
356,178
|
|||
Commitments
and Contingencies
|
-
|
|||
Stockholders’
Equity:
|
||||
Preferred
stock, $.01 par value
|
||||
Authorized
- 1,000,000 shares
|
||||
Issued
and outstanding - Series A, none; Series B, convertible,
|
||||
27,000
shares , stated value $100, Liquidation preference
$2,700,000
|
2,700,000
|
|||
Series
D, stated value $12.40, convertible, 241,933 shares
|
3,000,000
|
|||
Common
stock, $.01 par value
|
||||
Authorized
- 50,000,000 shares, issued 3,322,798 shares and
|
||||
outstanding
3,321,673 shares
|
33,228
|
|||
Additional
paid-in capital
|
74,037,652
|
|||
Deferred
Compensation
|
(88,547
|
)
|
||
Accumulated
deficit
|
(75,581,833
|
)
|
||
Treasury
stock (1,125 common shares, at cost)
|
(2,250
|
)
|
||
Total
stockholders’ equity
|
4,098,250
|
|||
Total
Liabilities and Stockholders' Equity
|
$
|
4,454,428
|
||
The
accompanying notes are an integral part of these condensed consolidated
financial statements.
|
|
For
the three months ended
|
For
the six months ended
|
|||||||||||
|
March
31, 2006
|
March
31, 2005
|
March
31, 2006
|
March
31, 2005
|
|||||||||
Revenues:
|
|||||||||||||
Product
sales
|
$
|
230,106
|
$
|
199,700
|
$
|
447,388
|
$
|
436,608
|
|||||
Equipment
rental income
|
-
|
2,624
|
-
|
7,950
|
|||||||||
Consulting
and royalty fees
|
41,932
|
42,228
|
65,538
|
62,653
|
|||||||||
Total
revenues
|
272,038
|
244,552
|
512,926
|
507,211
|
|||||||||
Operating
Expenses:
|
|||||||||||||
Cost
of product sales and equipment rental income
|
174,186
|
168,596
|
342,848
|
330,390
|
|||||||||
Research
and development
|
94,348
|
116,916
|
176,187
|
193,496
|
|||||||||
Selling,
general and administrative
|
718,099
|
602,356
|
1,405,653
|
1,274,634
|
|||||||||
Total
operating expenses
|
986,633
|
887,868
|
1,924,688
|
1,798,520
|
|||||||||
Operating
loss
|
(714,595
|
)
|
(643,316
|
)
|
(1,411,762
|
)
|
(1,291,309
|
)
|
|||||
Other
income
|
-
|
132,200
|
-
|
132,200
|
|||||||||
Interest
income (expense), net
|
3,393
|
(181,941
|
)
|
7,122
|
(331,020
|
)
|
|||||||
-
|
|||||||||||||
Net
loss
|
(711,202
|
)
|
(693,057
|
)
|
(1,404,640
|
)
|
(1,490,129
|
)
|
|||||
Deemed
Dividend - Series D
|
|||||||||||||
Convertible
Preferred Stock
|
(1,317,061
|
)
|
-
|
(1,317,061
|
)
|
-
|
|||||||
Net
loss attributable to common stockholders
|
$
|
(2,028,263
|
)
|
$
|
(693,057
|
)
|
$
|
(2,721,701
|
)
|
$
|
(1,490,129
|
)
|
|
Net
loss per basic and diluted common share
|
$
|
(0.61
|
)
|
$
|
(0.47
|
)
|
$
|
(0.82
|
)
|
$
|
(1.19
|
)
|
|
Weighted
average number of common shares outstanding,
|
|||||||||||||
basic
and diluted
|
3,321,673
|
1,482,197
|
3,321,673
|
1,249,736
|
|||||||||
The
accompanying notes are an integral part of these condensed consolidated
financial statements.
|
|||||||||||||
|
Series
B Convertible
|
Series
D Convertible
|
|||||||||||||||||||||||||||||||||||
|
Preferred Stock
|
Preferred
Stock
|
Common
Stock
|
Treasury
Stock
|
|||||||||||||||||||||||||||||||||
|
Number
|
Number
|
Number
|
Additional
|
Number
|
Total
|
|||||||||||||||||||||||||||||||
|
of
|
of
|
of
|
Paid-in
|
Deferred
|
Accumulated
|
of
|
Stockholders'
|
|||||||||||||||||||||||||||||
|
Shares |
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
Capital
|
Compensation
|
Deficit
|
Shares
|
Amount
|
Equity
|
|||||||||||||||||||||||||
Balance,
October 1, 2005
|
27,000
|
$
|
2,700,000
|
-
|
$
|
-
|
3,322,798
|
$
|
33,228
|
$
|
74,241,755
|
$
|
- |
$
|
(74,177,193
|
)
|
1,125
|
$
|
(2,250
|
)
|
$
|
2,795,540
|
|||||||||||||||
Issuance
of Series D Convertible Preferred Stock,
net ( see Note 7 )
|
241,933
|
3,000,000
|
(292,650
|
)
|
2,707,350
|
||||||||||||||||||||||||||||||||
|
|||||||||||||||||||||||||||||||||||||
Grant
of stock options to consultants
|
88,547
|
(88,547
|
)
|
-
|
|||||||||||||||||||||||||||||||||
|
|||||||||||||||||||||||||||||||||||||
Net
loss
|
(1,404,640
|
)
|
(1,404,640
|
)
|
|||||||||||||||||||||||||||||||||
Balance,
March
31, 2006
|
27,000
|
$
|
2,700,000
|
241,933
|
$
|
3,000,000
|
3,322,798
|
$
|
33,228
|
$
|
74,037,652
|
$
|
(88,547
|
)
|
$
|
(75,581,833
|
)
|
1,125
|
$
|
(2,250
|
)
|
$
|
4,098,250
|
|
Six
Months Ended March 31,
|
||||||
2006
|
2005
|
||||||
Cash
Flows from Operating Activities:
|
|||||||
Net
loss
|
$
|
(1,404,640
|
)
|
$
|
(1,490,129
|
)
|
|
Adjustments
to reconcile net loss to net cash used in
|
|||||||
operating
activities:
|
|||||||
Amortization
of debt discount
|
-
|
165,220
|
|||||
Amortization
of deferred financing costs
|
-
|
89,542
|
|||||
Depreciation
and amortization
|
110,032
|
157,171
|
|||||
Interest
on secured convertible notes
|
-
|
95,300
|
|||||
Changes
in operating assets and liabilities:
|
|||||||
Accounts
receivable, net
|
(42,827
|
)
|
(184,533
|
)
|
|||
Inventories,
net
|
(114,445
|
)
|
159,099
|
||||
Other
assets
|
(57,252
|
)
|
8,826
|
||||
Accounts
payable and accrued expenses
|
(21,419
|
)
|
(527,770
|
)
|
|||
Net
cash used in operating activities
|
(1,530,551
|
)
|
(1,527,274
|
)
|
|||
Cash
Flows from Investing Activities:
|
|||||||
Proceeds
from sale of Strax business
|
-
|
66,000
|
|||||
Acquisition
of property and equipment
|
(13,418
|
)
|
(1,436
|
)
|
|||
Increase
in security deposit
|
(3,156
|
)
|
- | ||||
Net
cash (used in) provided by investing activities
|
(16,574
|
)
|
64,564
|
||||
Cash
Flows from Financing Activities:
|
|||||||
Proceeds
from short term loan
|
-
|
100,000
|
|||||
Repayment
of short term loan
|
-
|
(100,000
|
)
|
||||
Proceeds
from short term loans - related party
|
-
|
145,923
|
|||||
Repayment
of short term loans - related party
|
-
|
(73,123
|
)
|
||||
Net
proceeds from issuance of Series C Preferred Stock
|
-
|
4,065,034
|
|||||
Net
proceeds from issuance of Series D Preferred Stock
|
2,707,350
|
-
|
|||||
Net
cash provided by financing activities
|
2,707,350
|
4,137,834
|
|||||
Net
increase in cash and cash equivalents
|
1,160,225
|
2,675,124
|
|||||
Cash
and cash equivalents, beginning of period
|
1,257,158
|
27,583
|
|||||
Cash
and cash equivalents, end of period
|
$
|
2,417,383
|
$
|
2,702,707
|
|||
Supplemental
Disclosures of Cash Flow Information:
|
|||||||
Cash
paid for interest during the period
|
$
|
-
|
$
|
33,508
|
|||
Cash
paid for income taxes during the period
|
$
|
3,110
|
$
|
192,672
|
|||
Non
Cash-Flow Items:
|
|||||||
Transfer
of net book value of certain equipment for leases to
inventory
|
$
|
-
|
$
|
66,177
|
|||
Conversion
of secured convertible notes and interest into equity
|
$
|
-
|
$
|
1,595,300
|
|||
Conversion
of notes payable -related party into equity
|
$
|
-
|
$
|
500,000
|
|||
Conversion
of short-term loans payable - related party into equity
|
$
|
-
|
$
|
72,800
|
|||
The
accompanying notes are an integral part of these condensed consolidated
financial statements.
|
Three
months ended March 31,
|
Six
months ended March 31,
|
||||||||||||
2006
|
2005
|
2006
|
2005
|
||||||||||
Net
loss attributable to common stockholders
as reported
|
$
|
(2,028,263
|
)
|
$
|
(693,057
|
)
|
$
|
(2,721,701
|
)
|
$
|
(1,490,129
|
)
|
|
Deduct:
|
|||||||||||||
Stock-based
employee compensation determined under fair value method for all
awards,
net of elated tax effects
|
(610
|
)
|
(748
|
)
|
(1,220
|
)
|
(1,495
|
)
|
|||||
Pro
forma net loss attributable to common
stockholders
|
$
|
(2,028,873
|
)
|
$
|
(693,805
|
)
|
$
|
(2,722,921
|
)
|
$
|
(1,491,624
|
)
|
|
Basic
and diluted loss attributable
|
|||||||||||||
to
common stockholders
|
|||||||||||||
As
reported
|
$
|
(0.61
|
)
|
$
|
(0.47
|
)
|
$
|
(0.82
|
)
|
$
|
(1.19
|
)
|
|
Pro
forma
|
$
|
(0.61
|
)
|
$
|
(0.47
|
)
|
$
|
(0.82
|
)
|
$
|
(1.19
|
)
|
Raw
materials
|
$531,204
|
Finished
goods
|
251,857
|
$783,061
|
For
the Year Ending September 30,
|
Amount
|
|||
2006
|
$
|
44,903
|
||
2007
|
91,894
|
|||
2008
|
93,983
|
|||
2009
|
96,071
|
|||
2010
|
98,160
|
|||
Thereafter
|
100,248
|
|||
$
|
525,259
|
Caprius,
Inc.
|
|||
(Registrant)
|
|||
Date:
May 15, 2006
|
/s/
George
Aaron
|
||
George Aaron | |||
President & Chief Executive Officer | |||
Date:
May 15, 2006
|
/s/
Jonathan
Joels
|
||
Jonathan Joels | |||
Chief Financial Officer |