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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549
 FORM 10-QSB Quarterly Report Under section 13 or 15(d) of the Securities Exchange Act of 1934 For the Quarterly Period Ended September 30, 2004 Commission File No. 000-20989 UROPLASTY, INC.  Minnesota, U.S.A.
(State or other jurisdiction of
incorporation or organization)
    
    41-1719250
(I.R.S. Employer
Identification No.)
 2718 Summer Street NE
Minneapolis, Minnesota 55413-2820
(Address of principal executive offices) (612) 378-1180
(Issuers telephone number, including area code) Securities registered under Section 12(g) of the Exchange Act: Common Stock, $.01 par value (Title of class) Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the
past 12 months (or for such shorter period that the Company was required to file such reports), and (2) has been subject
to such filing requirements for the past 90 days. YES [X]
    
    NO [  ]
 The number of shares
outstanding of the issuers only class of common stock on
November 1, 2004 was 4,662,731.

Transitional Small Business Disclosure Format: YES [  ]
    
    NO [X]
    Page 1




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TABLE OF CONTENTS  PART I. FINANCIAL INFORMATIONITEM 1. FINANCIAL STATEMENTSCONSOLIDATED BALANCE SHEETSCONSOLIDATED BALANCE SHEETSCONSOLIDATED STATEMENTS OF OPERATIONSCONSOLIDATED STATEMENTS OF CASH FLOWSNOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTSITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSITEM 3. CONTROLS AND PROCEDURESPART II. OTHER INFORMATIONITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERSITEM 5. OTHER INFORMATIONITEM 6. EXHIBITSSIGNATURESForm of Manufacturing and Distribution AgreementCertifications by the CEO/CFO and the Controller Pursuant to Section 302Certifications by the CEO/CFO and the Controller Pursuant to Section 906    Table of Contents  
 PART I. FINANCIAL INFORMATION 
 ITEM 1. FINANCIAL STATEMENTS UROPLASTY, INC. AND SUBSIDIARIES 
 CONSOLIDATED BALANCE SHEETS September 30, 2004(unaudited)
    
    March 31, 2004AssetsCurrent assets:Cash and cash equivalents
    
    $
    2,067,906
    
    
    $
    2,697,670Accounts receivable, net
    
    
    1,136,533
    
    
    
    1,065,176Inventories
    
    
    519,018
    
    
    
    519,130Other
    
    
    250,501
    
    
    
    235,078Total current assets
    
    
    3,973,958
    
    
    
    4,517,054Property, plant, and equipment, net
    
    
    1,054,559
    
    
    
    1,071,116Intangible assets, net
    
    
    45,296
    
    
    
    51,495Deferred tax assets
    
    
    158,375
    
    
    
    123,893Total assets
    
    $
    5,232,188
    
    
    $
    5,763,558
 See accompanying notes to the interim consolidated financial statements. Page 2




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UROPLASTY, INC. AND SUBSIDIARIES 
 CONSOLIDATED BALANCE SHEETS September 30, 2004(unaudited)
    
    March 31, 2004Liabilities and Shareholders EquityCurrent liabilities:Accounts payable
    
    $
    294,932
    
    
    $
    225,315Income tax payable
    
    
    127,479
    
    
    
    101,562Accrued liabilities
    
    
    441,018
    
    
    
    475,957Current maturities  long-term debt
    
    
    42,717
    
    
    
    42,301Total current liabilities
    
    
    906,146
    
    
    
    845,135Long-term debt  less current maturities
    
    
    463,088
    
    
    
    479,720Accrued pension liability
    
    
    341,568
    
    
    
    334,470Total liabilities
    
    
    1,710,802
    
    
    
    1,659,325Shareholders equity:Common stock $.01 par value; 20,000,000
shares authorized, 4,662,731 and
4,584,802 shares issued and
outstanding at September 30, 2004 and
March 31, 2004, respectively
    
    
    46,627
    
    
    
    45,848Additional paid-in capital
    
    
    9,291,913
    
    
    
    9,130,580Accumulated deficit
    
    
    (5,532,587
    )
    
    
    (4,756,622
    )Accumulated other comprehensive loss
    
    
    (284,567
    )
    
    
    (315,573
    )Total shareholders equity
    
    
    3,521,386
    
    
    
    4,104,233Total liabilities and shareholders equity
    
    $
    5,232,188
    
    
    $
    5,763,558
 See accompanying notes to the interim consolidated financial statements. Page 3




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UROPLASTY, INC. AND SUBSIDIARIES 
 CONSOLIDATED STATEMENTS OF OPERATIONS  Three Months Ended
    
    Six Months EndedSeptember 30,
    
    September 30,2004
    
    2003
    
    2004
    
    2003(restated)
    
    
    
    
    
    (restated)Net sales
    
    $
    1,650,724
    
    
    $
    1,175,073
    
    
    $
    3,403,220
    
    
    $
    2,534,662Cost of goods sold
    
    
    470,172
    
    
    
    306,004
    
    
    
    933,730
    
    
    
    702,975Gross profit
    
    
    1,180,552
    
    
    
    869,069
    
    
    
    2,469,490
    
    
    
    1,831,687Operating expensesGeneral and administrative
    
    
    508,260
    
    
    
    489,313
    
    
    
    899,372
    
    
    
    956,542Research and development
    
    
    585,716
    
    
    
    452,008
    
    
    
    1,165,769
    
    
    
    881,964Selling and marketing
    
    
    590,799
    
    
    
    374,938
    
    
    
    1,118,756
    
    
    
    799,3031,684,775
    
    
    
    1,316,259
    
    
    
    3,183,897
    
    
    
    2,637,809Operating loss
    
    
    (504,223
    )
    
    
    (447,190
    )
    
    
    (714,407
    )
    
    
    (806,122
    )Other income (expense)Interest income
    
    
    9,199
    
    
    
    6,608
    
    
    
    15,078
    
    
    
    17,117Interest expense
    
    
    (5,137
    )
    
    
    (5,404
    )
    
    
    (10,321
    )
    
    
    (11,248
    )Foreign currency exchange loss
    
    
    (4,675
    )
    
    
    (4,210
    )
    
    
    (14,086
    )
    
    
    (6,571
    )(613
    )
    
    
    (3,006
    )
    
    
    (9,329
    )
    
    
    (702
    )Loss before income taxes
    
    
    (504,836
    )
    
    
    (450,196
    )
    
    
    (723,736
    )
    
    
    (806,824
    )Income tax expense (benefit)
    
    
    (14,230
    )
    
    
    28,339
    
    
    
    52,229
    
    
    
    120,395Net loss
    
    $
    (490,606
    )
    
    $
    (478,535
    )
    
    $
    (775,965
    )
    
    $
    (927,219
    )Basic and diluted loss per common share
    
    $
    (0.11
    )
    
    $
    (0.11
    )
    
    $
    (0.17
    )
    
    $
    (0.21
    )Weighted average common shares
outstanding:Basic and diluted
    
    
    4,653,870
    
    
    
    4,487,222
    
    
    
    4,622,728
    
    
    
    4,485,606
 See accompanying notes to the interim consolidated financial statements. Page 4




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UROPLASTY, INC. AND SUBSIDIARIES 
 CONSOLIDATED STATEMENTS OF CASH FLOWS   Six Months EndedSeptember 30,2004
    
    2003(restated)Cash flows from operating activities:Net loss
    
    $
    (775,965
    )
    
    $
    (927,219
    )Adjustments to reconcile net loss to net cash used in operating activities:Depreciation and amortization
    
    
    80,503
    
    
    
    76,710Loss on disposal of assets
    
    
    2,281
    
    
    
    Stock-based consulting expense
    
    
    
    
    
    
    164,407Changes in operating assets and liabilities:Accounts receivable
    
    
    (64,874
    )
    
    
    279,785Inventories
    
    
    4,992
    
    
    
    (9,466
    )Other current assets
    
    
    (17,345
    )
    
    
    (3,873
    )Deferred tax assets
    
    
    (30,094
    )
    
    
    (36,972
    )Accounts payable
    
    
    67,952
    
    
    
    119,679Accrued liabilities
    
    
    (10,566
    )
    
    
    (4,848
    )Accrued pension liability
    
    
    (1,552
    )
    
    
    18,261Additional pension liability
    
    
    1,824
    
    
    
    (2,222
    )Net cash used in operating activities
    
    
    (742,844
    )
    
    
    (325,758
    )Cash flows from investing activities:Payments for property, plant and equipment
    
    
    (47,773
    )
    
    
    (56,377
    )Payments for intangible assets
    
    
    (5,512
    )
    
    
    (15,080
    )Net cash used in investing activities
    
    
    (53,285
    )
    
    
    (71,457
    )Cash flows from financing activities:Repayment of long-term debt
    
    
    (20,761
    )
    
    
    (19,589
    )Net proceeds from issuance of stock
    
    
    162,112
    
    
    
    9,602Net cash provided by (used in) financing activities
    
    
    141,351
    
    
    
    (9,987
    )Effect of exchange rates on cash and cash equivalents
    
    
    25,014
    
    
    
    27,371Net decrease in cash and cash equivalents
    
    
    (629,764
    )
    
    
    (379,831
    )Cash and cash equivalents at beginning of period
    
    
    2,697,670
    
    
    
    3,375,981Cash and cash equivalents at end of period
    
    $
    2,067,906
    
    
    $
    2,966,150Supplemental disclosure of cash flow information:Cash paid during the period for interest
    
    $
    10,930
    
    
    $
    12,095Cash paid during the period for income taxes
    
    
    60,362
    
    
    
    
 See accompanying notes to the interim consolidated financial statements. Page 5




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UROPLASTY, INC. AND SUBSIDIARIES 
 NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS  1. Basis of Presentation We have prepared our consolidated financial statements included in this Form
10-QSB, without audit, pursuant to the rules and regulations of the Securities
and Exchange Commission. Certain information and footnote disclosures normally
included in financial statements prepared in accordance with accounting
principles generally accepted in the United States of America have been
condensed or omitted, pursuant to such rules and regulations. The consolidated
results of operations for any interim period are not necessarily indicative of
results for a full year. These consolidated statements should be read in
conjunction with the consolidated financial statements and related notes
included in our Annual Report on Form 10-KSB for the year ended March 31, 2004. The consolidated financial statements presented herein as of September 30, 2004
and for the three and six-months periods ended September 30, 2004 and 2003
reflect, in the opinion of management, all material adjustments consisting only
of normal recurring adjustments necessary for a fair presentation of the
consolidated financial position, results of operations and cash flows for the
interim periods. We have identified certain accounting policies that we consider particularly
important for the portrayal of our results of operations and financial position
and which may require the application of a higher level of judgment by the
Companys management, and as a result are subject to an inherent level of
uncertainty. These are characterized as critical accounting policies and
address revenue recognition, inventories, foreign currency translation and
transactions, and impairment of long-lived assets, each of which is more fully
described in our Annual Report on Form 10-KSB for the year ended March 31,
2004. Based upon our review, we have determined that these policies remain our
most critical accounting policies for the three and six-month periods ended
September 30, 2004, and have made no changes to these policies during fiscal
2005. 2. Nature of Business and Corporate Liquidity We currently sell our products outside of the United States and are undertaking
FDA investigational clinical trials. Based on our current plans, we intend to
launch our products in the U.S. after obtaining FDA approval. Completing
clinical trials and obtaining FDA approval is a costly and time-consuming
process. As a result of the $2.4 million gross proceeds of a Rights Offering
completed July 2002, we believe that current resources and the funds generated
from sale of our products outside the U.S. will be adequate to meet our cash
flow needs, including R&D activities, associated with existing products and
markets through fiscal 2005. Ultimately, we will need to achieve profitability
and positive cash flows from operations or obtain additional debt or equity
financing to fund our operations. 3. Restatements During the fiscal 2004 year end close process, we determined that our pension
plan, covering 17 employees in The Netherlands, had historically been reported
as a defined contribution plan, but should have been reported as a defined
benefit plan. We pay premiums to an insurance company to fund annuities for
these employees. However, we are responsible for funding additional annuities
based on continued service and future salary increases. Contemporaneously, we also discovered an error in how we recorded the effect of
exchange rates on cash and cash equivalents in our statement of cash flows.
Historically, we prepared the statement of cash flows on a consolidated basis
using period-end exchange rates. Instead, we should have prepared the
statement of cash flows on an entity basis using average exchange rates in
accordance with paragraph 25 of FAS 95. In this Form 10-QSB, we have restated our consolidated results of operations
for the three and six-month periods ended September 30, 2003, our consolidated
statement of cash flows for the six-month period ended September 30, 2003, and
related footnote disclosures for the impact of accounting for the pension plan
as a defined benefit plan and for the correction of the effect of exchange
rates on cash and cash equivalents as follows: Page 6




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Three Months Ended
    
    Six Months EndedSeptember 30, 2003
    
    September 30, 2003As Previously
    
    
    
    
    
    As PreviouslyReported
    
    As Restated
    
    Reported
    
    As RestatedSTATEMENT OF OPERATIONS DATA:Cost of goods sold
    
    $
    274,186
    
    
    $
    306,004
    
    
    $
    679,773
    
    
    $
    702,975Operating expensesGeneral and administrative
    
    
    456,769
    
    
    
    489,313
    
    
    
    922,045
    
    
    
    956,542Research and development
    
    
    420,190
    
    
    
    452,008
    
    
    
    858,763
    
    
    
    881,964Selling and marketing
    
    
    342,394
    
    
    
    374,938
    
    
    
    764,804
    
    
    
    799,303Operating loss
    
    
    (318,466
    )
    
    
    (447,190
    )
    
    
    (690,723
    )
    
    
    (806,122
    )Loss before income taxes
    
    
    (321,472
    )
    
    
    (450,196
    )
    
    
    (691,425
    )
    
    
    (806,824
    )Income tax expense
    
    
    72,248
    
    
    
    28,339
    
    
    
    152,414
    
    
    
    120,395Net loss
    
    $
    (393,720
    )
    
    $
    (478,535
    )
    
    $
    (843,839
    )
    
    $
    (927,219
    )Net loss per common shareBasic
    
    $
    (0.09
    )
    
    $
    (0.11
    )
    
    $
    (0.19
    )
    
    $
    (0.21
    )Diluted
    
    $
    (0.09
    )
    
    $
    (0.11
    )
    
    $
    (0.19
    )
    
    $
    (0.21
    )CASH FLOW DATA:Net cash used in operating activities
    
    
    
    
    
    
    
    
    
    $
    (432,293
    )
    
    $
    (325,758
    )Net cash used in investing activities
    
    
    
    
    
    
    
    
    
    
    (71,311
    )
    
    
    (71,457
    )Net cash used in financing activities
    
    
    
    
    
    
    
    
    
    
    (9,868
    )
    
    
    (9,987
    )Effect of exchange rates on cash and
cash equivalents
    
    
    
    
    
    
    
    
    
    $
    133,641
    
    
    $
    27,371
 4. Inventories Inventories are stated at the lower of cost (first-in, first-out method) or
market (net realizable value) and consist of the following: September 30, 2004
    
    March 31, 2004Raw materials
    
    $
    206,646
    
    
    $
    138,920Work-in-process
    
    
    36,494
    
    
    
    110,511Finished goods
    
    
    275,878
    
    
    
    269,699$
    519,018
    
    
    $
    519,130
 Page 7




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5. Comprehensive Loss Comprehensive loss consists of net loss, and the translation adjustments as
follows: Three Months Ended
    
    Six Months EndedSeptember 30,
    
    September 30,2004
    
    2003
    
    2004
    
    2003(restated)
    
    
    
    
    
    (restated)Net loss
    
    $
    (490,606
    )
    
    $
    (478,535
    )
    
    $
    (775,965
    )
    
    $
    (927,219
    )Items of other comprehensive
income (loss):Translation adjustment
    
    
    55,566
    
    
    
    28,238
    
    
    
    31,994
    
    
    
    137,389Additional pension liability
    
    
    (1,929
    )
    
    
    (690
    )
    
    
    (988
    )
    
    
    (3,415
    )Comprehensive loss
    
    $
    (436,969
    )
    
    $
    (450,987
    )
    
    $
    (744,959
    )
    
    $
    (793,245
    )
 6. Reconciliation of Net Loss and Per Share Amounts Used in EPS Calculation Basic loss per common share is calculated by dividing net loss by the
weighted-average common shares outstanding during the period. Basic andDiluted LossPer ShareFor the three months ended:September 30, 2004Net loss
    
    $
    (490,606
    )Weighted average shares
    
    
    4,653,870Per share amount
    
    $
    (0.11
    )For the three months ended:September 30, 2003Net loss (restated)
    
    $
    (478,535
    )Weighted average shares
    
    
    4,487,222Per share amount (restated)
    
    $
    (0.11
    )For the six months ended:September 30, 2004Net loss
    
    $
    (775,965
    )Weighted average shares
    
    
    4,622,728Per share amount
    
    $
    (0.17
    )
 Page 8




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Basic andDiluted LossPer ShareFor the six months ended:September 30, 2003Net loss (restated)
    
    $
    (927,219
    )Weighted average shares
    
    
    4,485,606Per share amount (restated)
    
    $
    (0.21
    )
 The following options and warrants outstanding at September 30, 2004 and 2003
to purchase shares of common stock were excluded from diluted loss per share,
because of their anti-dilutive effect: Number of
    
    Range of ExerciseOptions/Warrants
    
    PricesFor the three and six months ended:September 30, 2004
    
    
    1,647,571
    
    
    $0.90 to $10.50September 30, 2003
    
    
    1,737,629
    
    
    $0.90 to $10.50
 7. Shareholders Equity We apply the intrinsic-value method to account for employee stock-based
compensation. As such, compensation expense, if any, is recorded on the date of
grant if the current market price of the underlying stock exceeds the exercise
price. We account for stock-based instruments granted to non-employees under the fair
value method of SFAS No. 123 and Emerging Issues Task Force (EITF) 96-18,
Accounting for Equity Instruments That Are Issued to Other Than Employees for
Acquiring, or in Conjunction with Selling, Goods or Services. Under SFAS No.
123, we record options at their fair value on the measurement date, which is
typically the vesting date. Consulting Agreements On April 1, 2003, we executed a consulting agreement with CCRI. Corporation
(CCRI) to provide investor relations and development services. We pay CCRI a
monthly fee of $4,000 plus expenses. CCRI received 35,000 shares of fully
vested restricted common stock, and vested warrants to purchase 50,000 shares
of common stock at an exercise price of $3.00 per share, and received vested
warrants to purchase 50,000 shares of common stock at an exercise price of
$5.00 per share on November 2, 2003. We fully amortized the fair value of the
common stock and warrants in fiscal 2004. Stock-based compensation expense for
the CCRI agreement for the three and six-months ended September 30, 2003
aggregated $53,244 and $106,486, respectively. On April 1, 2004, we extended
the agreement for one year. The monthly fee of $4,000 plus expenses remained
the same. On April 1, 2003, we executed a consulting agreement with Executive Advisory
Group (EAG) to provide us with general management advice and guidance as well
as strategic and tactical planning services. Mr. Sam B. Humphries, a Director
of the Company, is President of EAG. We pay EAG a monthly fee of $6,000 plus
expenses. EAG also received stock options to purchase 50,000 shares of common
stock, exercisable at $2.80 per share. We fully amortized the fair value of the
stock options in fiscal 2004. Stock-based compensation expense for the EAG
agreement for the three and six-months ended September 30, 2003 aggregated
$28,959 and $57,921, respectively. On April 1, 2004, we extended the agreement
for one year. The monthly fee of $6,000 plus expenses remained the same. 8. Stock-based Compensation Had we determined compensation cost based on the fair value at the grant date
for our stock options issued to employees under SFAS 123, Accounting for
Stock-Based Compensation, our net loss and per share amounts would have
increased to the pro forma amounts shown below: Page 9




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Three Months Ended
    
    Six Months EndedSeptember 30,
    
    September 30,2004
    
    2003
    
    2004
    
    2003(restated)
    
    
    
    
    
    (restated)Net loss
 As reported
    
    $
    (490,606
    )
    
    $
    (478,535
    )
    
    $
    (775,965
    )
    
    $
    (927,219
    )Deduct: Total stock-based
employee compensation
expense determined under
fair value based method
for all awards
    
    
    (35,914
    )
    
    
    (82,574
    )
    
    
    (71,921
    )
    
    
    (173,499
    )Net loss
 Pro forma
    
    $
    (526,520
    )
    
    $
    (561,109
    )
    
    $
    (847,886
    )
    
    $
    (1,100,718
    )Net loss per common share
 As reported:Basic and diluted
    
    $
    (0.11
    )
    
    $
    (0.11
    )
    
    $
    (0.17
    )
    
    $
    (0.21
    )Net loss per common share
 Pro forma:Basic and diluted
    
    $
    (0.11
    )
    
    $
    (0.13
    )
    
    $
    (0.18
    )
    
    $
    (0.25
    )
 9. Savings and Retirement Plans We sponsor various plans for eligible employees in the United States, the
United Kingdom (UK), and The Netherlands. Our retirement savings plan in the
United States conforms to Section 401(k) of the Internal Revenue Code and
participation is available to substantially all employees. We may also make
discretionary contributions ratably to all eligible employees. Our
international subsidiaries have defined benefit retirement plans for eligible
employees. These plans provide benefits based on each employees years of
service and compensation during the years immediately preceding retirement,
termination, disability, or death, as defined in the plans. Our UK subsidiarys
defined benefit plan accrued pension liability and periodic pension cost are
not material to our consolidated financial statements. Pension plan assets are
invested in insurance contracts. The cost for our plan in The Netherlands includes the following components for
the periods ended September 30, 2004 and 2003: Three Months Ended
    
    Six Months EndedSeptember 30,
    
    September 30,2004
    
    2003
(restated)
    
    2004
    
    2003
(restated)Gross service cost, net of
employee contribution
    
    $
    29,399
    
    
    $
    19,244
    
    
    $
    58,475
    
    
    $
    38,724Interest cost
    
    
    16,638
    
    
    
    12,619
    
    
    
    33,093
    
    
    
    25,392Expected return on assets
    
    
    (9,535
    )
    
    
    (7,316
    )
    
    
    (18,966
    )
    
    
    (14,721
    )Amortization
    
    
    3,285
    
    
    
    1,939
    
    
    
    6,533
    
    
    
    3,901Net periodic retirement cost
    
    $
    39,787
    
    
    $
    26,486
    
    
    $
    79,135
    
    
    $
    53,296
 Page 10




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Major assumptions used in the above calculations include: Three Months Ended
    
    Six Months EndedSeptember 30,
    
    September 30,2004
    
    2003
(restated)
    
    2004
    
    2003
(restated)Discount rate
    
    
    5.25
    %
    
    
    5.25
    %
    
    
    5.25
    %
    
    
    5.25
    %Expected return on assets
    
    
    4.50
    %
    
    
    4.50
    %
    
    
    4.50
    %
    
    
    4.50
    %Expected rate of
increase in future
compensationGeneral
    
    
    3
    %
    
    
    3
    %
    
    
    3
    %
    
    
    3
    %Individual
    
    
    0%-3
    %
    
    
    0%-3
    %
    
    
    0%-3
    %
    
    
    0%-3
    %
 10. Foreign Currency Translation All assets and liabilities are translated using period-end exchange rates and
statements of operations items are translated using average exchange rates for
the period. We record the resulting translation adjustment within accumulated
other comprehensive loss, a separate component of shareholders equity. We
recognize foreign currency transaction gains and losses in our consolidated
statements of operations, including unrealized gains and losses on short-term
intercompany obligations using period-end exchange rates. We recognize
unrealized gains and losses on long-term intercompany obligations within
accumulated other comprehensive loss, a separate component of shareholders
equity. We recognize exchange gains and losses primarily as a result of fluctuations in
currency rates between the U.S. dollar (the functional reporting currency) and
the euro and British pound (currencies of our subsidiaries), as well as their
effect on the dollar denominated intercompany obligations between the Company
and its foreign subsidiaries. All intercompany balances are revolving in nature
and are not deemed to be long-term balances. For the three-months ended
September 30, 2004 and 2003, we recognized foreign currency losses of $4,675
and $4,210, respectively. For the six-months ended September 30, 2003 and 2002,
we recognized foreign currency losses of $14,086 and $6,571, respectively. 11. Income Tax Expense During the quarters ended September 30, 2004 and 2003, our Dutch subsidiaries
recorded income tax (benefit) expense of $(14,230) and $28,339, respectively,
as we have fully utilized our net operating loss carryforwards. The U.S. net
operating loss carryforwards cannot be used to offset taxable income in foreign
jurisdictions. For the six-months ended September 30, 2004 and 2003, our Dutch
subsidiaries recorded income tax expense of $52,229 and $120,395, respectively, 12. Business Segment Information Uroplasty sells Macroplastique® and the related ancillary products to augment
soft tissues for the purpose of treating urinary incontinence and
vesicoureteral reflux. At this time, we make sales only outside the United
States because we have not yet made submissions to the FDA for regulatory
approval to market our products in the United States. Our current objectives
are to focus on sales and marketing activities designed to increase market
penetration and sales of Macroplastique for stress urinary incontinence (SUI)
and for the treatment of vesicoureteral reflux (VUR), and of PTQ Implants
(formerly PTP Implants) in countries outside the U.S., and to efficiently and
effectively execute the Macroplastique human clinical study for treatment of
female SUI within the U.S. We also sell injectable implant products outside the
U.S. for soft-tissue augmentation for specific indications in otolaryngology
and plastic surgery applications under the name Bioplastique in limited
markets. Our Macroplastique product line accounts for 76% and 83%,
respectively, of total net sales during the 2004 and 2003 six-month periods
presented. In addition, we sell specialized wound care products in The
Netherlands and United Kingdom as a distributor. Page 11




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##### Table of Contents



Based upon the above, we operate in only one reportable segment consisting of
medical products primarily for the urology market. Information regarding operations in different geographies for the three and
six-months ended September 30, 2004 and 2003 is as follows: AdjustmentsUnited
    
    The
    
    United
    
    andStates
    
    Netherlands
    
    Kingdom
    
    Eliminations
    
    ConsolidatedFiscal 2005Sales to customers,
three-months ended
September 30, 2004
    
    $
    
    
    
    $
    1,415,794
    
    
    $
    413,024
    
    
    $
    (178,094
    )
    
    $
    1,650,724Sales to customers,
six-months ended
September 30, 2004
    
    
    
    
    
    
    2,861,247
    
    
    
    872,855
    
    
    
    (330,882
    )
    
    
    3,403,220Income tax benefit,
three-months ended
September 30, 2004
    
    
    
    
    
    
    (14,230
    )
    
    
    
    
    
    
    
    
    
    
    (14,230
    )Income tax expense,
six-months ended
September 30, 2004
    
    
    
    
    
    
    52,229
    
    
    
    
    
    
    
    
    
    
    
    52,229Net income (loss),
three-months ended
September 30, 2004
    
    
    (420,915
    )
    
    
    (27,692
    )
    
    
    (19,737
    )
    
    
    (22,262
    )
    
    
    (490,606
    )Net income (loss),
six-months ended
September 30, 2004
    
    
    (974,961
    )
    
    
    105,559
    
    
    
    (5,405
    )
    
    
    98,842
    
    
    
    (775,965
    )Long-lived assets
At September 30, 2004
    
    
    312,561
    
    
    
    772,340
    
    
    
    14,954
    
    
    
    
    
    
    
    1,099,855Fiscal 2004(restated)Sales to customers,
three-months ended
September 30, 2003
    
    
    
    
    
    
    1,054,549
    
    
    
    361,822
    
    
    
    (241,298
    )
    
    
    1,175,073Sales to customers,
six-months ended
September 30, 2003
    
    
    
    
    
    
    2,269,130
    
    
    
    694,174
    
    
    
    (428,642
    )
    
    
    2,534,662Income tax expense,
three-months ended
September 30, 2003
    
    
    
    
    
    
    28,339
    
    
    
    
    
    
    
    
    
    
    
    28,339Income tax expense,
six-months ended
September 30, 2003
    
    
    
    
    
    
    120,395
    
    
    
    
    
    
    
    
    
    
    
    120,395Net income (loss),
three-months ended
September 30, 2003
    
    
    (488,893
    )
    
    
    53,640
    
    
    
    (92,249
    )
    
    
    48,967
    
    
    
    (478,535
    )Net income (loss),
six-months ended
September 30, 2003
    
    
    (808,258
    )
    
    
    241,378
    
    
    
    (239,329
    )
    
    
    (121,010
    )
    
    
    (927,219
    )Long-lived asset
At September 30, 2003s
    
    
    163,047
    
    
    
    740,196
    
    
    
    22,628
    
    
    
    
    
    
    
    925,871
 
 ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS We recommend that you read this Report on Form 10-QSB in conjunction with our
Annual Report on Form 10-KSB for the year ended March 31, 2004. Forward-looking Statements We may from time to time make written or oral forward-looking statements,
including our statements contained in this filing with the Securities and
Exchange Commission and in our reports to stockholders, as well as elsewhere.
Forward-looking statements are statements such as those contained in
projections, plans, objectives, estimates, statements of future economic
performance, and assumptions related to any of the foregoing, and may be
identified by the use of forward-looking terminology, such as may, expect,
anticipate, estimate, goal, continue, or other comparable terminology.
By their very nature, forward-looking statements are subject to known and
unknown risks and uncertainties relating to our future Page 12




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performance that may cause our actual results, performance, or achievements, or
industry results, to differ materially from those expressed or implied in any
such forward-looking statements. Any such statement is qualified by reference
to the following cautionary statements. Our business operates in highly competitive markets and is subject to changes
in general economic conditions, competition, customer and market preferences,
government regulation, the impact of tax regulation, foreign exchange rate
fluctuations, the degree of market acceptance of products, the uncertainties of
potential litigation, as well as other risks and uncertainties detailed
elsewhere herein and from time to time in our Securities and Exchange
Commission filings. In this filing, the section entitled Managements Discussion and Analysis of
Financial Condition and Results of Operations contains forward-looking
statements. Various factors and risks (not all of which are identifiable at
this time) could cause our results, performance, or achievements to differ
materially from that contained in our forward-looking statements, and investors
are cautioned that any forward-looking statement contained herein or elsewhere
is qualified by and subject to the warnings and cautionary statements contained
above and in our other filings with the Securities and Exchange Commission. Uroplasty does not undertake and assumes no obligation to update any
forward-looking statement that we may make from time to time. Overview Uroplasty, Inc. develops, manufactures, and/or markets medical products in
certain segments of the urology, gynecology, urogynecology, colon and rectal,
wound care, otolaryngology and plastic surgery markets. The products we sell
are subject to regulation by the U.S. FDA and/or various regulating agencies in
countries outside the U.S. Existing sales have been, and we expect future sales
growth to be, derived from Macroplastique and related ancillary products
designed for use by urologists, gynecologists, and uro-gynecologists for the
primary treatment of SUI and for the treatment of VUR, a condition in which
urine flows backward from the bladder to the kidney. Macroplastique is
comprised of soft, textured, solid, medical grade silicone elastomer implants
suspended in a biocompatible carrier gel. Our minimally invasive procedure
allows for Macroplastique to be placed in the tissue of the mid-urethra (in the
case of SUI), and at the ureteral orifice (in the case of VUR). The implants
act as a bulking material to restore urinary continence or to eliminate reflux
of urine from the bladder to the kidneys. In addition to the urological applications, we also market our implantable
tissue bulking material outside the U.S. for reconstructive and cosmetic
plastic surgery applications under the trade name Bioplastique Implants; fecal
incontinence applications under the trade name PTQ Implants (formerly PTP
Implants); and vocal cord rehabilitation under the trade name VOX Implants. In
The Netherlands and the United Kingdom, we distribute certain wound care
products on behalf of another company in accordance with an executed
Distributor Agreement. Under the terms of the Distributor Agreement, we are
not obligated to purchase any minimum level of wound care products. Our products are sold by direct sales forces in the United Kingdom, and by a
network of distributors in numerous areas outside the U.S., including Europe,
Australia, Canada and South America. We are currently conducting a
multi-center human clinical trial with our urethral bulking agent,
Macroplastique, pursuant to an FDA IDE as a minimally invasive, office-based
procedure for treating female SUI. This study is required as part of a
Premarket Approval Submission to the FDA for marketing within the United
States. Our current objectives are to focus on sales and marketing activities designed
to increase market penetration and sales of Macroplastique for SUI, VUR, and of
PTQ Implants for fecal incontinence applications in countries outside the U.S.,
and to efficiently and effectively execute the Macroplastique human clinical
study for treatment of female SUI within the U.S. Critical Accounting Policies We prepare our consolidated financial statements in accordance with accounting
principles generally accepted in the U.S., which require us to make estimates
and assumptions in certain circumstances that affect amounts reported. In
preparing these consolidated financial statements, we have made our best
estimates and judgments of certain amounts, giving due consideration to
materiality. We believe that of our significant accounting policies, the
following are particularly important to the portrayal of our results of
operations and financial position. They may require the application of a
higher level of judgment by Uroplasty management, and as a result are subject
to an inherent degree of uncertainty. Page 13




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Revenue Recognition and Accounts Receivable. The Securities and Exchange
Commissions Staff Accounting Bulletin (SAB) No. 104, Revenue Recognition in
Financial Statements, provides guidance on the application of generally
accepted accounting principles to selected revenue recognition issues. We
believe our revenue recognition policies comply with SAB 104. We market and
distribute our products through a network of distributors and through direct
sales to end-users in the United Kingdom and The Netherlands. We recognize
revenue upon shipment of product to our distributors and direct customers. We
have no customer acceptance provisions or installation obligations. Our sales
terms to our distributors and customers provide no right of return outside of
our standard warranty, and payment terms consistent with industry standards
apply. Sales terms and pricing to our distributors are governed by the
respective distribution agreements. Our distribution partners purchase the
Uroplasty products to meet sales demand of their end-user customers as well as
to fulfill their internal requirements associated with the sales process and,
if applicable, contractual purchase requirements under the respective
distribution agreements. Internal and other requirements include purchases of
products for training, demonstration and evaluation purposes, clinical
evaluations, product support, establishing inventories, and meeting minimum
purchase commitments. As a result, the level of our revenue during any period
is not necessarily indicative of our distributors sales to end-user customers
during that period, which are estimated not to be substantially different than
our sales to those distributors in each of the last two years. Our
distributors level of inventories of our products, their sales to end-user
customers and their internal product requirements may impact our future revenue
growth. Inventories. We state inventories at the lower of cost or market using the
first-in, first-out method. We provide reserves for slow moving and obsolete
inventories based upon current and expected future product sales and the
expected impact of product transitions or modifications. While we expect our
sales to grow, a reduction in sales could reduce the demand for our products,
and additional inventory reserves may be required. Foreign Currency Translation/Transactions. The financial statements of our
foreign subsidiaries were translated in accordance with the provisions of SFAS
No. 52 Foreign Currency Translation. Under this Statement, we translate all
assets and liabilities using period-end exchange rates, and we translate
statements of operations items using average exchange rates for the period. We
record the resulting translation adjustment within accumulated other
comprehensive loss, a separate component of shareholders equity. We recognize
foreign currency transaction gains and losses in the statement of operations,
including unrealized gains and losses on short-term intercompany obligations
using period-end exchange rates, resulting in an increase in the volatility of
our consolidated statements of operations. We recognize unrealized gains and
losses on long-term intercompany obligations within accumulated other
comprehensive loss, a separate component of shareholders equity. Impairment of Long-Lived Assets. Long-lived assets at September 30, 2004
consist of property, plant and equipment. We review our long-lived assets for
impairment whenever events or business circumstances indicate that the carrying
amount of an asset may not be recoverable. We measure the recoverability of
assets to be held and used by a comparison of the carrying amount of an asset
to future undiscounted net cash flows expected to be generated by the asset. If
we consider such assets impaired, we measure the impairment to be recognized by
the amount by which the carrying amount of the assets exceeds the fair value of
the assets. We report assets to be disposed of at the lower of the carrying
amount or fair value less costs to sell. Set forth below is managements discussion and analysis of the financial
condition and results of operations for the three and six-months ended
September 30, 2004 and 2003. Results of Operations Three-month period ended September 30, 2004 compared to three-month period
ended September 30, 2003 (as restated) Net Sales: In the second quarter ended September 30, 2004, net sales of all
products were $1,650,724, representing a $475,651 or 40% increase when compared
to net sales of $1,175,073 for the second quarter ended September 30, 2003.
Excluding fluctuations in foreign currency exchange rates, we had a sales
increase of approximately 28%. We believe the continued increase in sales is
related to the impact of the sales directors and managers, and their execution
of sales plans designed to expand our global market share in the specialties of
both urinary and fecal incontinence. The Macroplastique product line accounts
for 76% and 83% of total net sales, respectively, during the periods presented. Gross Profit: Gross profit was $1,180,552 and $869,069 for the quarters ended
September 30, 2004 and 2003, respectively, or 72% and 74% of net sales. Gross
profit as a percentage of net sales in any one specific period will continue to
fluctuate, based on the following factors: our unit sales, our utilization of
manufacturing capacity, the mix of products sold with different gross margins,
the mix of customers (and different discounts to them) and the mix of direct
sales versus sales Page 14




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through distributors (with higher margins on direct sales). Historically, the
gross margin has ranged from approximately 70-80% of net sales. General and Administrative Expense: General and administrative (G&A)
expenses increased from $489,313 during the second quarter of fiscal 2004 to
$508,260 during the second quarter of fiscal 2005. The G&A expense increase
related to increased salary costs, a $45,000 increase in professional fees for
accounting, an increase of $16,000 in legal fees and general price increases
and fluctuations in foreign currency exchange rates. This increase was offset
in part by decreases of $32,000 in consulting fees and $40,000 of shareholders
expense. The increased professional fees for accounting relate to our financial
statement restatements. The decrease in both the consulting fees and the
shareholders expense primarily relates to the $82,203 of stock-based
compensation expense recognized in the second quarter of fiscal 2004. Research and Development Expense: Research and development (R&D) expenses
increased $133,708, or 30%, from $452,008 during the second quarter of fiscal
2004 to $585,716 during the second quarter of fiscal 2005. The increase in R&D
expense is due to quality and regulatory costs related to the development of
our Premarket Approval (PMA) submission for U.S. market clearance for
Macroplastique in the treatment of adult female stress urinary incontinence. Selling and Marketing Expenses: Selling and marketing (S&M) costs increased
58% from $374,938 during the second quarter of fiscal 2004 to $590,799 during
the second quarter of fiscal 2005. The increase resulted from an $80,000
increase in personnel costs, a $107,000 increase in travel costs and costs
relating to trade-shows, conventions and congresses, general price increases,
and fluctuations in foreign currency exchange rates. The increased personnel
costs relate to additional sales staff and increased salaries and bonuses. Other Income (Expense): Other income (expense) includes interest income,
interest expense, foreign currency exchange gains and losses, settlement income
and other non-operating costs when incurred. Our financial results are subject
to material fluctuations based on changes in currency exchange rates. Other
income (expense) was $(613) and $(3,006) for the second quarters ended
September 30, 2004 and 2003, respectively. We recognize exchange gains and
losses primarily as a result of fluctuations in currency rates between the U.S.
Dollar (the functional reporting currency) and the Euro and British Pound
(currencies of our subsidiaries), as well as their effect on the dollar
denominated short-term intercompany obligations between the Company and its
foreign subsidiaries. We recognized foreign currency losses of $4,675 and
$4,210 for the second quarters ended September 30, 2004 and 2003, respectively. Income Tax Expense: Our Dutch subsidiaries recorded income tax expense
(benefit) of $(14,230) and $28,339 for the second quarter ended September 30,
2004 and 2003, respectively, as they have fully utilized their net operating
loss carryforwards. The U.S. net operating loss carryforwards cannot be used to
offset taxable income in foreign jurisdictions. We expect continued profits for
our Dutch subsidiaries and therefore continued income tax expenses. The Dutch
income tax rate is 29% for euro 22,689 of profit and 34.5% for the amount above
euro 22,689. Six-month period ended September 30, 2004 compared to six-month period ended
September 30, 2003 (as restated) Net Sales: During the six-months ended September 30, 2004, net sales of all
products were $3,403,220, representing an $868,558 or 34% increase when
compared to net sales of $2,534,662 for the six months ended September 30,
2003. Excluding fluctuations in foreign currency exchange rates, we had a sales
increase of approximately 24%. We believe the continued increase in sales is
related to the impact of the sales directors and managers, and their execution
of sales plans designed to expand our global market share in the specialties of
both urinary and fecal incontinence. The Macroplastique product line accounts
for 78% and 84% of total net sales, respectively, during the periods presented. Gross Profit: Gross profit was $2,469,490 and $1,831,687 for the six-months
ended September 30, 2004 and 2003, respectively, or 73% and 72% of net sales.
Gross profit as a percentage of net sales in any one specific period will
continue to fluctuate, based on the following factors: our unit sales, our
utilization of manufacturing capacity, the mix of products sold with different
gross margins, the mix of customers (and different discounts to them), and the
mix of direct sales versus sales through distributors (with higher gross
margins on direct sales). Historically, the gross margin has ranged from
approximately 70-80% of net sales. General and Administrative Expense: General and administrative (G&A)
expenses decreased from $956,542 during the six-months ended September 30, 2003
to $899,372 during the same period of fiscal 2005. The G&A expense decrease
related to $58,000 in reduced consulting fees and $107,000 of reduced
shareholders expense, offset in part by an increase in salary costs of
$27,000, an $84,000 increase in professional fees for accounting, general price
increases and fluctuations in foreign currency exchange rates. The decrease in
both the consulting fees and the shareholders expense primarily relates to the Page 15




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$164,407 in stock-based compensation expense recognized in fiscal 2004. The
increased professional fees for accounting relate to extra work regarding the
necessary restatements done and tax advisory work. Research and Development Expense: Research and development (R&D) expenses
increased $283,805, or 32%, from $881,964 during the six months ended September
30, 2003 to $1,165,769 for the same period of fiscal 2005. The increase in R&D
expense is primarily due to quality and regulatory costs related to the
development of the Companys Premarket Approval (PMA) submission for U.S.
market clearance for Macroplastique in the treatment of adult female stress
urinary incontinence. Selling and Marketing Expenses: Selling and marketing (S&M) costs increased
40% from $799,303 during the six months ended September 30, 2003 to $1,118,756
for the same period of fiscal 2005. This increase resulted from a $185,000
increase in personnel costs, an additional $175,000 in travel costs and costs
relating to trade-shows, conventions and congresses, general price increases,
and fluctuations in foreign currency exchange rates. The increase was offset by
a $59,000 decrease in promotional costs. The increased personnel costs relate
to additional sales staff and increased salaries and bonuses. Other Income (Expense): Other income (expense) includes interest income,
interest expense, foreign currency exchange gains and losses, settlement income
and other non-operating costs when incurred. Our financial results are subject
to material fluctuations based on changes in currency exchange rates. Other
income (expense) was $(9,329) and $(702) for the six months ended September 30,
2004 and 2003, respectively. We recognize exchange gains and losses primarily
as a result of fluctuations in currency rates between the U.S. Dollar (the
functional reporting currency) and the euro and British Pound (currencies of
our subsidiaries), as well as their effect on the dollar denominated short-term
intercompany obligations between the Company and its foreign subsidiaries. We
recognized foreign currency losses of $14,086 and $6,571 for the periods
presented. Income Tax Expense: Our Dutch subsidiaries recorded income tax expense of
$52,229 and $120,395 for the periods presented, as they have fully utilized
their net operating loss carryforwards. The U.S. net operating loss
carryforwards cannot be used to offset taxable income in foreign jurisdictions.
We expect continued profits for our Dutch subsidiaries and therefore continued
income tax expenses. The Dutch income tax rate is 29% for euro 22,689 of
profit and 34.5% for the amount above euro 22,689. Liquidity and Capital Resources As of September 30, 2004, our cash and cash equivalent balances totaled
$2,067,906. At September 30, 2004, we had working capital of approximately $3.1 million.
During the six month period ended September 30, 2004, we used $742,844 of cash
in operating activities, compared to $325,758 of cash used in the prior-year.
The usage of cash was primarily attributable to the net loss incurred of
$775,965. Accounts receivable, other current assets, accounts payable and
accrued expenses fluctuated due to the timing of payments and fluctuations in
foreign currency exchange rates. We recorded $164,407 of non-cash stock-based
compensation expense during the six months ended September 30, 2003. Uroplasty currently has no financing arrangements in place with any bank for
general working capital needs, and no material unused sources of liquidity
other than the cash, equipment leasing arrangements, and our accounts
receivable and inventory balances at September 30, 2004 of $1,136,533 and
$519,018, respectively. For the remainder of fiscal 2005, we do not anticipate
any material capital expenditures. Our financial condition and results of operations could be materially affected
by fluctuations in foreign currency exchange rates and weak economic conditions
in foreign markets where we sell and distribute our products. The effects of
these conditions could include reduced unit sales and reduced sales in dollars
when converted from foreign currency amounts and material gains and losses on
transactions denominated in foreign currencies. Furthermore, because our U.S.
operations are funded by sales denominated in foreign currency, strengthening
of the U.S. dollar against the Euro, and/or the British Pound could have an
adverse effect on our cash flow and results of operations. We expect to continue to incur significant costs for regulatory activities
associated with obtaining premarket approval in the United States of our
Macroplastique product. In September 2004, we signed a manufacturing and
distribution agreement with CL Medical SAS, under which we have the exclusive
U.S. distribution and manufacturing rights for CL Medicals product for
treating SUI, which is currently sold in Europe under the brand name I-Stop.
As part of that agreement, we are responsible for obtaining FDA approval of the
I-Stop product. As a result, we expect to incur additional quality assurance
and regulatory costs related to obtaining 510(K) approval of the I-Stop
product. For the remainder of fiscal 2005, we have Page 16




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budgeted approximately $1,400,000 for our regulatory expenses. In addition, we
currently expect that during fiscal 2006 selling and marketing expenses will
continue to increase due to the anticipated launch of the Macroplastique
and I-Stop products in the United States. We believe that current resources and the funds generated from sale of our
products outside the U.S. will be adequate to meet our cash flow needs,
including R&D activities associated with existing products and markets, through
fiscal 2005. Ultimately, we will need to achieve profitability and positive
cash flows from operations or obtain additional debt or equity financing to
fund our operations. Repayments of our contractual obligations, consisting of royalties, notes
payable, and operating leases, are summarized below: Payments Due by PeriodRemainder of
    
    
    
    
    
    Fiscal 2007 andTotal
    
    Fiscal 2005
    
    Fiscal 2006
    
    ThereafterMinimum royalty payments
    
    $
    378,500
    
    
    
    27,000
    
    
    
    104,000
    
    
    
    247,500Notes payable
    
    
    505,805
    
    
    
    21,358
    
    
    
    42,712
    
    
    
    441,735Operating lease commitments
    
    
    534,533
    
    
    
    198,986
    
    
    
    241,752
    
    
    
    93,795Total contractual obligations
    
    $
    1,418,838
    
    
    
    247,344
    
    
    
    388,464
    
    
    
    783,030
 Uroplasty has a pension plan covering 17 employees in The Netherlands, reported
as a defined benefit plan. We pay premiums to an insurance company to fund
annuities for these employees. However, we are responsible for funding
additional annuities based on continued service and future salary increases. We are obligated to pay royalties of 5% of net sales in the U.S. of
Macroplastique products with a minimum of $50,000 per year. The duration of
this royalty agreement is through May 1, 2006. Under another royalty agreement
we pay royalties, in the aggregate, of three to five percent of net sales of
Macroplastique, Bioplastique, and PTQ Implants subject to a monthly minimum of
$4,500. The royalties payable under this Agreement will continue until the
patent referenced in the Agreement expires in 2010. Under a license agreement
for the Macroplastique Implantation System, we pay a royalty of 10 British
pounds for each unit sold during the life of the patent. 
 ITEM 3. CONTROLS AND PROCEDURES. Disclosure Controls and Procedures. Within the 90 days prior to the date of
this report, Daniel G. Holman, our President, Chief Executive Officer, Chief
Financial Officer, and Arie J. Koole, our Controller, Principal Accounting
Officer, carried out an evaluation of the effectiveness of the design and
operation of our disclosure controls and procedures pursuant to Rule 13a-15b
under the Securities Exchange Act of 1934. Based on their review of our
disclosure controls and procedures, such officers have concluded that our
disclosure controls and procedures are effective in timely alerting them to
material information relating to us that is required to be included in our
periodic SEC filings. Internal Controls and Procedures. There were no significant changes in
internal controls or in other factors that could significantly affect these
controls subsequent to the date of their evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses. Page 17




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PART II. OTHER INFORMATION Except as indicated below, none of the items contained in PART II of Form
10-QSB are applicable to us for the three months ended September 30, 2004. 
 ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. On September 8, 2004, we held our annual meeting of stockholders. At the
meeting, our stockholders re-elected Messrs. Pitlor and Jamison to serve until
our 2007 annual meeting of stockholders. The voting on their election was as
follows: For Mr. Pitlor: Votes Cast in Favor: 3,640,313
Votes Cast Against: 2,404
Abstentions and Broker Non-Votes: 1,017,148 For Mr. Jamison: Votes Cast in Favor: 3,640,313
Votes Cast Against: 2,404
Abstentions and Broker Non-Votes: 1,017,148 The Directors whose terms continued after the meeting are
Daniel G. Holman, Sam B. Humphries and R. Patrick Maxwell. 
 ITEM 5. OTHER INFORMATION. On September 2, 2004, we entered into a Manufacturing and Distribution
Agreement with CL Medical SAS, pursuant to which we plan to distribute in the
Unites States, on an exclusive basis, CL Medicals tension-free vaginal tape
for the treatment of female SUI currently marketed in Europe under the brand
name I-Stop. We have agreed to purchase our entire requirements of product
components from CL Medical. We are responsible for U.S. FDA clinical and
regulatory requirements for the product. The agreement is for six years, with
our option to renew the agreement for successive five-year terms upon notice to
CL Medical. We are responsible to purchase particular minimum amounts of
product components from CL Medical during the first five years of the
agreement. 
 ITEM 6. EXHIBITS. (a) Exhibits 10.19 Form of Manufacturing and Distribution Agreement with CL Medical SAS 31.1 Certifications by the Chief Executive Officer/Chief Financial Officer and
the Controller pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 32.1 Certifications by the Chief Executive Officer/Chief Financial Officer and
the Controller pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (this
Exhibit is furnished pursuant to SEC rules, but is deemed not filed) Page 18




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SIGNATURES In accordance with the requirements of the Securities Exchange Act of 1934, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized. UROPLASTY, INC.Date: November 12, 2004
    by:
    /s/ DANIEL G. HOLMANDaniel G. HolmanPresident, Chief Executive Officer,Chief Financial Officer and Director (Principal
Executive and Financial Officer)Date: November 12, 2004
    by:
    /s/ ARIE J. KOOLEArie J. KooleController (Principal Accounting Officer)
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