______________
|
||
Delaware
(State
or other jurisdiction of
incorporation
or organization)
|
3845
(Primary
Standard Industrial
Classification
Code Number)
|
22-2457487
(I.R.S.
Employer
Identification
Number)
|
_______________
|
||
One
University Plaza, Suite 400
Hackensack,
New Jersey 07601
(201)
342-0900
(Address
and Telephone Number of Principal Executive Offices and Principal
Place of
Business)
|
||
_______________
|
||
Jonathan
Joels
Treasurer
and Chief Financial Officer
One
University Plaza, Suite 400
Hackensack,
New Jersey 07601
(201)
342-0900
(Name,
Address and Telephone Number of Agent For Service)
|
||
_______________
Copies
to:
Bruce
A. Rich, Esq.
Thelen
Reid Brown Raysman & Steiner LLP
875
Third Avenue
New
York, New York 10022
(212)
603-2000
|
||
_______________
|
||
Approximate
Date of Proposed Sale to the Public: from
time to time after the effective date of this Registration
Statement.
|
CALCULATION
OF REGISTRATION FEE
|
||||
Title
of Each
Class
of Securities
to
be Registered
|
Amount
to
Be
Registered(1)
|
Proposed
Maximum
Offering
Price Per
Share
(2)
|
Proposed
Maximum
Aggregate
Offering
Price
|
Amount
of
Registration
Fee
|
Common
Stock, $01. par value (3)
|
6,250,000
shs.
|
$1.00
|
$6,250,000
|
$191.88
|
Common
Stock, $.01 par value (4)
|
3,125,000
shs.
|
1.00
|
3,125,000
|
95.94
|
Common
Stock, $.01 par value (4)
|
182,500
shs.
|
1.00
|
182,500
|
5.60
|
Total
|
9,557,500
shs.
|
9,557,500
|
$293.42
|
(1) |
All
shares registered pursuant to this registration statement are to
be
offered by selling stockholders. Pursuant to Rule 416 under the Securities
Act of 1933, this registration statement also covers such number
of
additional shares of common stock to prevent dilution resulting from
stock
splits, stock dividends and similar transactions pursuant to the
terms of
the Series E Convertible Preferred Stock and the warrants referenced
below.
|
(2) |
Estimated
solely for the purpose of computing amount of the registration fee
pursuant to Rule 457(c) promulgated under the Securities Act of 1933,
as
amended, based on the average of the bid and asked prices on the
OTC
Bulletin Board on March 23, 2007.
|
(3) |
Represents
6,250,000 shares underlying Series E Convertible Preferred
Stock.
|
(4) |
Represents
3,307,500 shares of common stock issuable upon exercise of warrants
held
by the selling stockholders.
|
Securities
Covered Hereby
|
9,557,500
shares, includes 6,250,000 shares underlying Series E convertible
preferred stock and 3,307,500 shares subject
to warrants, including warrants for 182,500 shares of common stock
granted
to placement agent and advisors on the March 2007 placement.
|
Common
Stock to be Outstanding after the Offering
|
13,349,173
shares, assuming the selling stockholders convert all of their
Series E Preferred Stock and exercise all their warrants, and no
conversion of other series of outstanding
|
|
preferred
stock nor exercise of other outstanding warrants and
options.
|
Use
of Proceeds
|
We
will receive no proceeds from the sale or other disposition of the
shares
of common stock covered hereby by the selling stockholders. However,
we
will receive $1,672,000 if all of the warrants for underlying shares
included in this prospectus are exercised for cash. We will use these
proceeds for general corporate purposes.
|
OTC
Electronic Bulletin Board Symbol
|
“CAPS”
|
Year
Ended September 30,
|
Three
Months Ended
December
31,
(Unaudited)
|
||||||||||||
Summary
of Operations
|
2006
|
2005
|
2006
|
2005
|
|||||||||
Total
revenues
|
$
|
1,235,469
|
$
|
848,802
|
$
|
508,424
|
$
|
240,888
|
|||||
Net
loss
|
(3,396,041
|
)
|
(2,538,408
|
)
|
(787,275
|
)
|
(693,438
|
)
|
|||||
Net
loss per common share (basic and
diluted)
|
$
|
(1.42
|
)
|
$
|
(1.16
|
)
|
$
|
(0.23
|
)
|
$
|
(0.21
|
)
|
|
Weighted
average common shares outstanding, basic and diluted
|
3,321,673
|
2,288,543
|
3,464,716
|
3,321,673
|
Statement
of Financial Position
|
As
of
September
30, 2006
|
As
of
December
31, 2006
(Unaudited)
|
|||||
Cash
and cash equivalents
|
$
|
1,068,954
|
$
|
428,338
|
|||
Total
assets
|
2,777,020
|
2,287,854
|
|||||
Working
capital
|
1,653,302
|
927,764
|
|||||
Long-term
debt
|
-
|
-
|
|||||
Stockholders’
equity
|
2,159,491
|
1,416,478
|
Fiscal
Period
|
Fiscal
Year Ending
9/30/07
|
Fiscal
Year Ended
9/30/06
|
Fiscal
Year Ended
9/30/05
|
|||
High
|
Low
|
High
|
Low
|
High
|
Low
|
|
First
Quarter
|
$0.65
|
$0.51
|
$2.45
|
$1.05
|
$3.80
|
$2.20
|
Second
Quarter *
|
1.08
|
0.45
|
2.35
|
1.30
|
6.80
|
2.60
|
Third
Quarter
|
—
|
—
|
1.69
|
0.80
|
5.00
|
2.10
|
Fourth
Quarter
|
—
|
—
|
0.80
|
0.55
|
2.98
|
2.00
|
a)
|
No
need to pack containers of medical
waste
|
b)
|
No
need to transport infectious waste through facilities with patients
|
c)
|
No
need to ship infectious medical waste on public
roads
|
d)
|
Environmentally
sound approach for disinfection - uses biodegradable chemicals;
does not
release smoke, odor, steam or other emissions to the air; removes
the need
for incineration
|
e)
|
Quiet
system - noise level during cycle is approx. 64.1dB(A), regarded
below
levels of noise safety concerns by most government
regulations
|
a)
|
Reduce
the exposure to infectious medical waste by limiting the time an
employee
handles, stores and packs the waste
|
b)
|
No
need to administer and track waste that is shipped from the
facility
|
c)
|
Ease
of use
|
d)
|
Employee
can continue to perform their regular functions while the SteriMed
Systems
treatment cycle is operational
|
a)
|
Rapid
deployment through our system designs that enable “same day” installation
and start up at a client’s site
|
b)
|
Easily
installed requiring only electricity, water and sewage outlet which
are
usually which are usually readily available. No special ventilation
or
lighting required
|
c)
|
Fast
cycle process times (approximately 15 minutes) that enables even
our
smallest system to generate a rapid throughput
capability
|
d)
|
Limited
training required for operators due to the fully automated systems
based
upon a one-touch start method
|
e)
|
Due
to their compact size, units can be strategically placed in a health
care
facility close to the waste generation sites
|
f)
|
Due
to its compact size, the SteriMed System is also appropriate for
mobile
facilities such as cruise ships and naval vessels.
|
a)
|
One
of the lowest capital costs for comprehensive onsite medical waste
systems
|
b)
|
Reduced
labor time as packaging for off site transportation is eliminated
|
c)
|
No
transportation costs to incineration site
|
d)
|
Our
business model allows for the SteriMed Systems to be leased to
U.S.
facilities generating the infectious clinical waste. This model
obviates
the need for capital investment by users, and should also reduce
previous
operating expenses in disposing of medical
waste.
|
e)
|
Ability
to fix costs for a given period of time, avoiding future price
increases
and surcharges, while allowing for additional capacity at a low
variable
cost
|
f)
|
Energy
efficient systems that consume just pennies per cycle in electricity
and
water
|
a)
|
Enable
infectious medical waste generating facilities to replace existing
systems
while meeting federal, state and local environmental as well as
health
regulations.
|
b)
|
Proprietary,
environmentally safe, 90% biodegradable chemical for disinfection
which
has been cleared for use in many foreign countries and which is
registered
in most states.
|
File
No.
|
Country
|
Application
No.
|
Application
Date
|
Trademark
No.
|
99205
|
Australia
|
813207
|
11/9/1999
|
813207
|
99202
|
Canada
|
1035658
|
11/12/1999
|
TMA
596,329
|
99203
|
Common
European Market Trademarks (CTM)
|
1380195
|
11/11/1999
|
1380195
|
99215
|
Hungary
|
M-9905279
|
11/10/1999
|
164682
|
99200
|
Israel
|
131893
|
11/1/1999
|
131893
|
99204
|
Japan
|
11-103144
|
11/12/1999
|
4562185
|
99206
|
Mexico
|
412940
|
2/23/2001
|
656603
|
99217
|
Poland
|
Z-209696
|
11/10/1999
|
145760
|
99213
|
Russia
|
99719294
|
11/18/1999
|
200276
|
99201
|
U.S.A
|
75/904,150
|
1/29/2000
|
2,713,884
|
File
No.
|
Country
|
Application
No.
|
Application
Date
|
Trademark
No.
|
99205
|
Australia
|
813207
|
11/9/1999
|
813207
|
99202
|
Canada
|
1035658
|
11/12/1999
|
TMA
596,329
|
99203
|
Common
European Market Trademarks (CTM)
|
1380195
|
11/11/1999
|
1380195
|
99215
|
Hungary
|
M-9905279
|
11/10/1999
|
164682
|
99200
|
Israel
|
131893
|
11/1/1999
|
131893
|
99204
|
Japan
|
11-103144
|
11/12/1999
|
4562185
|
99206
|
Mexico
|
412940
|
2/23/2001
|
656603
|
99217
|
Poland
|
Z-209696
|
11/10/1999
|
145760
|
99213
|
Russia
|
99719294
|
11/18/1999
|
200276
|
99201
|
U.S.A
|
75/904,150
|
1/29/2000
|
2,713,884
|
File
No.
|
Country
|
Application
No.
|
Application
Date
|
Patent
No.
|
Dates
Patent Valid
|
9454
|
U.S.A
|
08/369,533
|
1/5/1995
|
5,620,654
|
4/15/1997
- 4/15/2014
|
9456
|
Canada
|
2,139,689
|
1/6/1995
|
2,139,689
|
10/5/1999
- 1/6/2015
|
9452
|
Australia
|
10096/95
|
1/9/1995
|
684,323
|
4/2/1998-1/9/2015
|
9453
|
Japan
|
7-011844
|
1/23/1995
|
3058401
|
4/21/2000-
1/27/2015
|
9346
|
Israel
|
108,311
|
1/10/1994
|
108,311
|
12/23/1999-1/10/2014
|
9455
|
Europe
|
95630001.6
|
1/5/1995
|
EP0662346
|
3/28/2001
- 1/5/2015 or
according
to National Phase
|
File
No.
|
Country
|
Application
No.
|
Application
Date
|
Patent
No.
|
Dates
Valid (Patent
or
Application)
|
6.1
- 2114
|
Austria
|
|
1/5/1995
|
E200039
|
2/15/2001-1/5/2015
|
6.2
- 2115
|
Belgium
|
|
1/5/1995
|
10662346
|
2/15/2001-1/5/2015
|
6.3
- 2116
|
Germany
|
|
1/5/1995
|
DE69520458T2
|
2/15/2001-1/5/2015
|
6.4
- 2117
|
Spain
|
|
1/5/1995
|
EP0662346
|
2/15/2001-1/5/2015
|
6.5
- 2118
|
France
|
|
1/5/1995
|
EP0662346
|
2/15/2001-1/5/2015
|
6.6
- 2119
|
United
Kingdom
|
|
1/5/1995
|
EP(UK)662346
|
2/15/2001-1/5/2015
|
6.7
- 2120
|
Italy
|
|
1/5/1995
|
0662346
|
2/15/2001-1/5/2015
|
6.8
- 2121
|
Netherlands
|
|
1/5/1995
|
EP0662346
|
2/15/2001-1/5/2015
|
File
No.
|
Country
|
Application
No.
|
Application
Date
|
Patent
No.
|
Dates
Valid (Patent or Application)
|
2338
|
Brazil
|
200300398
|
7/31/2003
|
P10206913-0
|
7/31/2003
- 2/4/2022
|
2339
|
Mexico
|
PA/a/2003/
006946
|
8/4/2003
|
Pending
|
8/4/2003
- 2/4/2022
|
2340
|
Russia
|
2003127023
|
9/4/2003
|
Pending
|
9/4/2003
- 2/4/2022
|
2341
|
South
Africa
|
2003/5602
|
7/21/2003
|
2003/5602
|
9/23/2003
- 2/4/2022
|
2342
|
Canada
|
2437219
|
8/1/2003
|
Pending
|
8/1/2003
- 2/4/2022
|
2343
|
China
|
02806986.2
|
9/22/2003
|
Pending
|
9/22/2003
- 2/4/2022
|
2712
|
Hong
Kong
|
4106248.3
|
8/20/2004
|
ZL028069862
|
6/14/2006-2/4/2022
|
2344
|
India
|
01389/
chenp/03
|
9/2/2003
|
Pending
|
9/2/2003
- 2/4/2022
|
2313/354
|
Europe
|
02711185.5
|
9/5/2003
|
P210477
PCT/EP
|
9/5/2003-
2/4/2022
|
2337
|
Australia
|
2002230065
|
2/4/2002
|
Pending
|
2/4/2002
- 2/4/2022
|
2373
|
USA
|
09/824,685
|
4/4/2001
|
6494391
|
12/17/2002
- 4/4/2021
|
Name
|
Age
|
Position
|
Dwight
Morgan
|
46
|
Chairman
of the Board, President & CEO
|
George
Aaron
|
54
|
Executive
Vice President - International Business Development
|
Jonathan
Joels
|
50
|
Chief
Financial Officer, Treasurer, Secretary
and Director
|
Kenneth
C. Leung (1)(2)
|
62
|
Director
|
Roger
W. Miller
|
60
|
Director
|
Sol
Triebwasser, Ph.D. (1)(2)
|
85
|
Director
|
Name
and
Principal
Position
|
Year
|
Salary
($) |
Bonus
($)
|
Other
Annual Compensation ($) |
Restricted
Stock Award(s) ($) |
Securities
Underlying Options SARs (#) |
LTIP
Payouts ($) |
All
Other
Compensation ($) |
George
Aaron
Chairman,
President/CEO
|
2006
2005
2004
|
240,000
240,000
240,000
|
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
Jonathan
Joels
CFO
|
2006
2005
2004
|
220,000
176,000
176,000
|
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
|
Elliott
Koppel
VP
Sales &
Marketing
|
2006
2005
2004
|
92,000
92,000
92,000
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
-0-
-0-
-0-
|
Options/SAR
Grants in Last Fiscal Year
|
|||||||
Individual
Grants
|
|||||||
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
|||
Name
|
Number
of
Securities Underlying Options/SARS Granted (#) |
%
of Total
Options/SARS Granted to Employee(s) in Fiscal Year |
Exercise
On
Base
Price
($/Sh) *
|
Expiration
Date
|
|||
George
Aaron
|
100,000
|
28.3%
|
2.20
|
01/04/16
|
|||
Jonathan
Joels
|
100,000
|
28.3%
|
2.20
|
01/04/16
|
|||
Elliott
Koppel
|
25,000
|
7.1%
|
2.20
|
01/04/16
|
|||
*
Repriced to $1.10 as outlined in the Stock Options section
below
|
Aggregate
Option/SAR Exercises in Last Fiscal Year and Fiscal Year End Option/SAR
Values
|
||||||||
Fiscal
Year End Option Value
|
||||||||
Name
|
Shares
Acquired
or
Exercised
|
Value
Realized
|
Number
of Securities
Underlying
Unexercised
Options
at Sept. 30, 2006
Exercisable/Unexercisable
|
Value
of Unexercised
In-the
Money Options
at
Sept. 30, 2006
Exercisable
($)
|
||||
George
Aaron
|
-
0
-
|
-
0
-
|
36,660/83,340
|
$-
0 -
|
||||
Jonathan
Joels
|
-
0
-
|
-
0
-
|
36,660/83,340
|
$-
0 -
|
||||
Elliott
Koppel
|
-
0
-
|
-
0
-
|
24,165/20,835
|
$-
0 -
|
Name
and Address
of
Beneficial
Owner*
|
Position
with Company
|
Amount
and
Nature
of Beneficial
Ownership
(1) of
Common
Stock
|
Percentage
of
Securities
***
|
Austin
W. Marxe and David M. Greenhouse
527
Madison Ave.
New
York, NY 10022
|
Holder
of over five percent
|
8,236,686(2)
|
77.4.%
|
Dolphin
Offshore Partners LP
120
East 17th
Street
New
York, NY 10003
|
Holder
of over five percent
|
3,375,000(3)
|
47.1%
|
Bonanza
Master Fund Ltd.
300
Crescent Ct., Suite 250
Dallas,
TX 75201
|
Holder
of over five percent
|
2,881,277(4)
|
46.4.%
|
Vision
Opportunity Master Fund Ltd
20
West 55th
Street
New
York, NY 10019
|
Holder
of over five percent
|
416,621(5)
|
9.9%
|
Shrikant
Mehta
Combine
International
354
Indusco Court
Troy,
Michigan 48083
|
Holder
of over five percent
|
210,894
|
5.6%
|
Dwight
Morgan
|
Chairman
of the Board; Chief Executive Officer; President
|
13,332 (6)
|
**
|
George
Aaron
|
Director;
Executive Vice President
|
293,341(7)
|
7.6%
|
Jonathan
Joels
|
Director;
Chief
Financial
Officer; Vice President; Treasurer; Secretary
|
288,555(8)
|
7.5%
|
Sol
Triebwasser, Ph.D.
|
Director
|
11,736(9)
|
**
|
Kenneth
C. Leung
|
Director
|
- (10)
|
**
|
Roger
W. Miller
|
Director
|
36,724
(11)
|
**
|
All
executive officers and Directors as a group (6 persons)
|
643,688(12)
|
16.3%
|
*
|
Address
of all holders except those listed with a specific address above
is, One
University Plaza, Suite 400, Hackensack, New Jersey
07601.
|
**
|
Less
than one percent (1%)
|
***
|
Does
not include the Series B Preferred Stock, as it is non-voting except
on
matters directly related to such
series.
|
(1)
|
Includes
voting and investment power, except where otherwise noted. The number
of
shares beneficially owned includes shares each beneficial owner and
the
group has the right to acquire within 60 days of March 5, 2007 pursuant
to
stock options, warrants and convertible securities.
|
(2)
|
Consists
of (A)(i)1,034,482 shares direct, (ii)1,753,578 shares underlying
warrants
presently exercisable, (iii) 1,045,718 shares underlying Series D
Convertible Preferred Stock and (iv) 2,343,750 shares underlying
Series E
Convertible Preferred Stock held by Special Situations Private Equity
Fund, L.P., (B)(i) 317,037 shares direct, (ii) 537,682 shares underlying
warrants presently exercisable, (iii) 320,685 shares underlying Series
D
Convertible Preferred Stock and (iv) 718,750 shares underlying Series
E
Convertible Preferred Stock held by Special Situations Fund III,
QP, L.P.,
and (C)(i) 27,790 shares direct, (ii) 46,843 shares underlying warrants
presently exercisable, (iii) 27,871 shares underlying Series D Convertible
Preferred Stock and (iv) 62,500 shares underlying Series E Convertible
Preferred Stock held by Special Situations Fund III, L.P. MGP Advisors
Limited (“MGP”) is the general partner of the Special Situations Fund III,
QP, L.P. and the general partner of and investment adviser to the
Special
Situations Fund III, L.P. AWM Investment Company, Inc. (“AWM”) is the
general partner of MGP and the investment adviser to the Special
Situations Fund III, QP, L.P. and the Special Situations Private
Equity
Fund, L.P. Austin W. Marxe and David M. Greenhouse are the principal
owners of MGP and AWM. Through their control of MGP and AWM, Messrs.
Marxe
and Greenhouse share voting and investment control over the portfolio
securities of each of the funds listed
above.
|
(3)
|
Consists
of (i) 2,250,000 shares underlying Series E Convertible Preferred
Stock
and (ii) 1,125,000 shares underlying warrants presently exercisable.
|
(4)
|
Consists
of (i) 457,500 shares, (ii) 1,976,012 shares underlying Series D
Convertible Preferred Stock and (iii) 447,765 shares underlying warrants
presently exercisable.
|
(5)
|
Includes
416,621 shares underlying Series E Convertible Preferred Stock. Excludes
(i) 333,379 shares underlying Series E Convertible Preferred Stock
and
(ii) 375,000 shares underlying warrants. Pursuant to a Letter Agreement,
dated February 27, 2007, between us and Vision Opportunity Master
Fund,
Ltd. (“Vision”), Vision covenanted not to convert its Series E Convertible
Preferred Stock or exercise its warrants if such conversion or exercise
would cause its beneficial ownership to exceed 9.99%, which provision
Vision may waive, upon not less than 61 days prior notice to us,
as
reported in its Schedule 13G filed on March 12,
2007.
|
(6)
|
Includes
13,332 shares underlying options presently exercisable and excludes
376,668 shares underlying options which are currently not
exercisable.
|
(7)
|
Includes
(i) 353 shares in retirement accounts, (ii) 8,199 shares underlying
warrants presently exercisable, (iii) 5 shares jointly owned with
his wife
and (iv) 53,330 shares underlying options presently exercisable,
and
excludes 416,670 shares underlying options which are currently not
exercisable.
|
(8)
|
Includes
(i) 48,000 shares as trustee for his children, (ii) 8,616 shares
underlying warrants presently exercisable, (iii) 53,330 shares underlying
options presently exercisable, (iv) 17,241 shares in a retirement
account,
and excludes 416,670 shares underlying options which are currently
not
exercisable.
|
(9)
|
Includes
11,666 shares underlying options presently exercisable and excludes
33,334
shares underlying options which are currently not
exercisable.
|
(10)
|
Excludes
20,000 shares underlying options which are currently not
exercisable.
|
(11)
|
Excludes
20,000 shares underlying options which are currently not
exercisable.
|
(12)
|
Includes
(i) 16,815 shares underlying warrants and (ii) 131,658 shares underlying
options presently exercisable, and excludes 1,283,342 shares underlying
options which are currently not
exercisable.
|
Name(1)
|
Shares
Beneficially Owned Prior To Offering(1)
|
Percent
Beneficially Owned
Before
Offering
|
Shares
to
be
Offered
|
Amount
Beneficially Owned After Offering(2)
|
Percent
Beneficially Owned After Offering
|
|||||||||||
Francis
Anderson (3)
|
5,500
|
*
|
4,500
|
1,000
|
*
|
|||||||||||
Dolphin
Offshore Partners LP(4)
|
3,375,000
|
47.1
|
%
|
3,375,000
|
-
|
*
|
||||||||||
Brian
Gable(5)
|
1,000
|
*
|
1,000
|
-
|
*
|
|||||||||||
Helen
Kohn (6)
|
42,500
|
1.1
|
%
|
15,000
|
27,500
|
*
|
||||||||||
Little
Bear Investments LLC (7)
|
190,258
|
4.8
|
%
|
187,500
|
2,758
|
*
|
||||||||||
Frayda
Mason (8)
|
24,000
|
*
|
15,000
|
9,000
|
*
|
|||||||||||
John
Nesbett (9)
|
112,500
|
2.9
|
%
|
112,500
|
-
|
*
|
||||||||||
Special
Situations Fund III, L.P.(10)(11)
|
165,004
|
4.2
|
%
|
93,750
|
71,254
|
1.8
|
%
|
|||||||||
Special
Situations Fund III QP, L.P. (10)(12)
|
1,894,154
|
35.3
|
%
|
1,078,125
|
816,029
|
15.2
|
%
|
|||||||||
Special
Situations Private Equity Fund, L.P. (10)(13)
|
6,177,528
|
69.1
|
%
|
3,515,625
|
2,661,903
|
29.8
|
%
|
|||||||||
Maryellen
Spedale (14)
|
6,750
|
*
|
4,500
|
2,250
|
*
|
|||||||||||
Lisa
Sucoff (15)
|
28,000
|
*
|
15,000
|
13,000
|
*
|
|||||||||||
Ronit
Sucoff (16)
|
42,500
|
1.1
|
%
|
15,000
|
27,500
|
*
|
||||||||||
Vision
Opportunity Master Fund Ltd (17)
|
1,125,000
|
22.9
|
%
|
1,125,000
|
_
|
*
|
1. |
Unless
otherwise indicated in the footnotes to this table, the persons and
entities named in the table have sole voting and sole investment
power
with respect to all shares beneficially owned, subject to community
property laws where applicable. Beneficial ownership includes shares
of
common stock underlying the Series D Preferred Stock, Series E Preferred
Stock and warrants, regardless of when exercisable. Ownership is
calculated based upon 3,791,673 shares of common stock outstanding
as of
March 5, 2007.
|
2. |
Assumes
the sale of all shares covered hereby. A portion of the shares to
be
beneficially owned after the offering herein, have been registered
for
sale in a separate Registration Statement on form SB-2 (No. 333-132849)
previously filed by us, or will be registered in a separate Registration
Statement on form SB-2.
|
3. |
Consists
of (i) 4,500 shares issuable upon exercise of warrants (initially
granted
to Equity as placement agent warrants) at an exercise price of $0.60
per
share.
|
4. |
Consists
of (i) 2,250,000 shares underlying Series E Preferred Stock and (ii)
1,125,000 shares issuable upon exercise of warrants at an exercise
price
of $0.50 per share. Peter Salas has investment power and voting power
of
these securities.
|
5. |
Consists
of 1,000 shares issuable upon exercise of warrants (initially granted
to
Equity as placement agent warrants) at an exercise price of $0.60
per
share.
|
6. |
Consists
of 15,000 shares issuable upon exercise of warrants (initially granted
to
Equity as placement agent warrants) at an exercise price of $0.60
per
share.
|
7. |
Includes
(i) 125,000 shares underlying Series E Preferred Stock, (ii) 62,500
shares
issuable upon exercise of warrants at an exercise price of $0.50
per share
and (iii) 2,758 shares issuable upon exercise of warrants at exercise
prices ranging from $2.90 to $5.60 per share. Jeffrey Mann and Zachary
Prensky each has investment power and voting power of the securities
being
registered. Does not include 14,483 shares issuable upon exercise
of
warrants held personally by Mr.
Prensky.
|
8. |
Consists
of 15,000 shares issuable upon exercise of warrants (initially granted
to
Equity as placement agent warrants) at an exercise price of $0.60
per
share.
|
9. |
Consists
of 112,500 shares issuable upon exercise of warrants at an exercise
price
of $.60 per share. Does not include 30,000 shares subject to options
held
by a company controlled by Mr.
Nesbett.
|
10. |
MGP
Advisors Limited (“MGP”) is the general partner of the Special Situations
Fund III, QP, L.P. and the general partner of and investment adviser
to
the Special Situations Fund III, L.P. AWM Investment Company, Inc.
(“AWM”)
is the general partner of MGP and the investment adviser to the Special
Situations Fund III, QP, L.P. and the Special Situations Private
Equity
Fund, L.P. Austin W. Marxe and David M. Greenhouse are the principal
owners of MGP and AWM . Through their control of MGP and AWM, Messrs.
Marxe and Greenhouse share voting and investment control over the
portfolio securities of each of the funds listed
above.
|
11. |
Includes
(i) 62,500 shares underlying Series E Preferred Stock and (ii) 31,250
shares issuable upon exercise of warrants at an exercise price of
$0.50
per share in the Series E Placement, included in this prospectus,
plus
(iii) 15,593 shares underlying warrants and (iv) 27,871 shares underlying
Series D Convertible Preferred
Stock.
|
12. |
Includes
(i) 718,750 shares underlying Series E Preferred Stock and (ii) 359,375
shares issuable upon exercise of warrants at an exercise price of
$0.50
per share in the Series E Placement, included in this prospectus,
plus
(iii) 178,307 shares underlying warrants and (iv) 320,685 shares
underlying Series D Convertible Preferred Stock.
|
13. |
Includes
(i) 2,343,750 shares underlying Series E Preferred Stock, and (ii)
1,171,875 shares issuable upon exercise of warrants at an exercise
price
of $0.50 per share in the Series E Placement, included in this prospectus,
plus (iii) 581,703 shares underlying warrants and (iv) 1,045,718
shares
underlying Series D Convertible Preferred
Stock.
|
14. |
Consists
of 4,500 shares issuable upon exercise of warrants (initially granted
to
Equity as placement agent warrants) at an exercise price of $0.60
per
share
|
15. |
Consists
of 15,000 shares issuable upon exercise of warrants (initially granted
to
Equity as placement agent warrants) at an exercise price of $0.60
per
share.
|
16. |
Consists
of 15,000 shares issuable upon exercise of warrants (initially granted
to
Equity as placement agent warrants) at an exercise price of $0.60
per
share.
|
17. |
Consists
of (i) 750,000 shares underlying Series E Preferred Stock and (iii)
375,000 shares is issuable upon exercise of warrants at an exercise
price
of $.50 per share. Adam Benowitz has investment power and voting
power of
these shares.
|
·
|
ordinary
brokerage transactions and transactions in which the broker-dealer
solicits purchases;
|
·
|
block
trades in which the broker-dealer will attempt to sell the shares
as agent
but may position and resell a portion of the block as principal
to
facilitate the transaction;
|
·
|
purchases
by a broker-dealer as principal and resale by the broker-dealer
for its
account;
|
·
|
an
exchange distribution in accordance with the rules of the applicable
exchange;
|
·
|
privately
negotiated transactions;
|
·
|
settlement
of short sales effected after the date the registration statement
of which
this prospectus is a part is declared effective by the
SEC;
|
·
|
through
the writing or settlement of options or other hedging transactions,
whether through an options exchange or
otherwise;
|
·
|
broker-dealers
may agree with the selling stockholders to sell a specified number
of such
shares at a stipulated price per share;
and
|
·
|
a
combination of any such methods of sale.
|
Page
|
|
F-2
|
|
F-3
|
|
F-4
|
|
F-5
|
|
F-6
|
|
F-7
- F-20
|
|
F-21
|
|
F-22
|
|
F-23
|
|
F-24
|
|
F-25
- F-29
|
|
CAPRIUS,
INC. AND
SUBSIDIARIES
|
||||
CONSOLIDATED
BALANCE SHEET
|
||||
September
30, 2006
|
||||
ASSETS
|
||||
Current
Assets:
|
||||
Cash
and cash equivalents
|
$
|
1,068,954
|
||
Accounts
receivable, net of reserve for bad debts of $ 5,163
|
249,761
|
|||
Inventories,
net
|
952,116
|
|||
Total
current assets
|
2,270,831
|
|||
Property
and Equipment:
|
||||
Office
furniture and equipment
|
230,604
|
|||
Equipment
for lease
|
23,500
|
|||
Leasehold
improvements
|
29,003
|
|||
283,107
|
||||
Less: accumulated
depreciation
|
202,781
|
|||
Property
and
equipment, net
|
80,326
|
|||
Other
Assets:
|
||||
Goodwill
|
285,010
|
|||
Intangible
assets, net
|
120,083
|
|||
Other
|
20,770
|
|||
Total
other assets
|
425,863
|
|||
Total
Assets
|
$
|
2,777,020
|
||
LIABILITIES
AND STOCKHOLDERS’ EQUITY
|
||||
Current
Liabilities:
|
||||
Accounts
payable
|
$
|
383,458
|
||
Accrued
expenses
|
59,402
|
|||
Accrued
compensation
|
174,669
|
|||
Total
current liabilities
|
617,529
|
|||
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 . 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
|
74,001,747
|
|||
Accumulated
deficit
|
(77,573,234
|
)
|
||
Treasury
stock (1,125 common shares, at cost)
|
(2,250
|
)
|
||
Total
stockholders’ equity
|
2,159,491
|
|||
Total
Liabilities and Stockholders' Equity
|
$
|
2,777,020
|
||
The
accompanying notes are an integral part of these consolidated financial
statements.
|
CAPRIUS,
INC. AND
SUBSIDIARIES
|
|||||||
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
|||||||
|
|||||||
For
the years ended
|
|||||||
September
30, 2006
|
September
30, 2005
|
||||||
Revenues:
|
|||||||
Product
sales
|
$
|
1,069,902
|
$
|
727,491
|
|||
Equipment
rental income
|
-
|
13,305
|
|||||
Consulting
and royalty fees
|
165,567
|
108,006
|
|||||
Total
revenues
|
1,235,469
|
848,802
|
|||||
Operating
Expenses:
|
|||||||
Cost
of product sales and equipment rental income
|
802,532
|
490,827
|
|||||
Research
and development
|
342,587
|
325,486
|
|||||
Selling,
general and administrative; includes stock based compensation
of $52,642
in 2006
|
3,064,084
|
2,730,071
|
|||||
Impairment
of goodwill
|
452,000
|
-
|
|||||
Total
operating expenses
|
4,661,203
|
3,546,384
|
|||||
Operating
loss
|
(3,425,734
|
)
|
(2,697,582
|
)
|
|||
Other
income
|
-
|
482,200
|
|||||
Interest
income
|
29,693
|
30,477
|
|||||
Interest
expense
|
-
|
353,503
|
|||||
Net
loss
|
(3,396,041
|
)
|
(2,538,408
|
)
|
|||
Deemed
Dividend - Series D Convertible Preferred Stock
|
(1,317,061
|
)
|
-
|
||||
Beneficial
Conversion Feature - Series C Convertible
|
|||||||
Preferred
Stock
|
-
|
(124,528
|
)
|
||||
Net
loss attributable to common stockholders
|
$
|
(4,713,102
|
)
|
$
|
(2,662,936
|
)
|
|
Net
loss per basic and diluted common share
|
$
|
(1.42
|
)
|
$
|
(1.16
|
)
|
|
Weighted
average number of common shares outstanding, basic and
diluted
|
3,321,673
|
2,288,543
|
|||||
The
accompanying notes are an integral part of these consolidated financial
statements.
|
Series
B Convertible
|
Series
C Convertible
|
Series
D Convertible
|
||||||||||||||||||||||||||||||||||||||
Preferred
Stock
|
Preferred
Stock
|
Preferred
Stock
|
Common
Stock
|
Treasury
Stock
|
||||||||||||||||||||||||||||||||||||
|
Total
|
|||||||||||||||||||||||||||||||||||||||
Number
|
Number
|
Number
|
Number
|
Additional
|
|
Number
|
Stockholders'
|
|||||||||||||||||||||||||||||||||
of
Shares
|
Amount
|
of
Shares
|
Amount
|
of
Shares
|
Amount
|
of
Shares
|
Amount
|
Paid-in
Capital
|
Accumulated
Deficit
|
of
Shares
|
Amount
|
Equity
(Deficiency)
|
||||||||||||||||||||||||||||
Balance,
October 1, 2004
|
27,000
|
$
|
2,700,000
|
-
|
$
|
-
|
-
|
$
|
-
|
1,023,453
|
$
|
10,235
|
$
|
68,031,614
|
$
|
(71,638,785
|
)
|
1,125
|
$
|
(2,250
|
)
|
$
|
(899,186
|
)
|
||||||||||||||||
Issuance
of Series C Manadatory Convertible
|
45,000
|
4,500,000
|
(434,966
|
)
|
4,065,034
|
|||||||||||||||||||||||||||||||||||
Preferred
Stock
|
||||||||||||||||||||||||||||||||||||||||
Conversion
of secured convertible notes
|
21,681
|
2,168,100
|
2,168,100
|
|||||||||||||||||||||||||||||||||||||
and
bridge financing into
Series
C Mandatory
|
||||||||||||||||||||||||||||||||||||||||
Convertible
Preferred Stock
|
||||||||||||||||||||||||||||||||||||||||
Conversion
of Series C Preferred into
|
(66,681
|
)
|
(6,668,100
|
)
|
2,299,345
|
22,993
|
6,645,107
|
-
|
||||||||||||||||||||||||||||||||
common
stock
|
||||||||||||||||||||||||||||||||||||||||
Net
loss
|
(2,538,408
|
)
|
(2,538,408
|
)
|
||||||||||||||||||||||||||||||||||||
Balance,
September 30, 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
|
241,933
|
3,000,000
|
(292,650
|
)
|
2,707,350
|
|||||||||||||||||||||||||||||||||||
Stock,
net
|
||||||||||||||||||||||||||||||||||||||||
Grant
of stock options to Consultants
|
52,642
|
52,642
|
||||||||||||||||||||||||||||||||||||||
for
Services
|
||||||||||||||||||||||||||||||||||||||||
Net
loss
|
(3,396,041
|
)
|
(3,396,041
|
)
|
||||||||||||||||||||||||||||||||||||
Balance,
September 30, 2006
|
27,000
|
$
|
2,700,000
|
-
|
$
|
-
|
241,933
|
$
|
3,000,000
|
3,322,798
|
$
|
33,228
|
$
|
74,001,747
|
$
|
(77,573,234
|
)
|
1,125
|
$
|
(2,250
|
)
|
$
|
2,159,491
|
CAPRIUS,
INC. AND
SUBSIDIARIES
|
|||||||
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
|||||||
For
the Years Ended
|
|||||||
|
September
30, 2006
|
September
30, 2005
|
|||||
Cash
Flows from Operating Activities:
|
|||||||
Net
loss
|
$
|
(3,396,041
|
)
|
$
|
(2,538,408
|
)
|
|
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
|
177,671
|
310,693
|
|||||
Impairment
of goodwill
|
452,000
|
-
|
|||||
Stock
based compensation expense
|
52,642
|
-
|
|||||
Interest
on secured convertible notes
|
-
|
95,300
|
|||||
Changes
in operating assets and liabilities:
|
|||||||
Accounts
receivable, net
|
(122,509
|
)
|
(53,769
|
)
|
|||
Inventories,
net
|
(283,500
|
)
|
108,079
|
||||
Other
assets
|
29,758
|
(14,536
|
)
|
||||
Accounts
payable and accrued expenses
|
239,932
|
(1,100,161
|
)
|
||||
Net
cash used in operating activities
|
(2,850,047
|
)
|
(2,938,040
|
)
|
|||
Cash
Flows from Investing Activities:
|
|||||||
Proceeds
from sale of Strax business
|
-
|
66,000
|
|||||
Acquisition
of property and equipment
|
(42,147
|
)
|
(32,139
|
)
|
|||
Increase
in security deposit
|
(3,360
|
)
|
(4,080
|
)
|
|||
Net
cash (used in) provided by investing activities
|
(45,507
|
)
|
29,781
|
||||
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
|