SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) of the
SECURITIES EXCHANGE ACT OF 1934
September 13, 2005
CSI BUSINESS FINANCE, INC.
(Exact Name of Registrant as Specified in Charter)
Florida 02-27569 65-0847995
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
1761 West Hillsboro Blvd, Suite 703, Deerfield Beach, Florida 33442
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(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (954) 570-5900
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Not Applicable
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(Former Name or Former Address, If Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
|_| Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
ITEM 1.01. ENTRY INTO MATERIAL DEFINITIVE AGREEMENTS
Securities Purchase Agreement
On September 9, 2005, CSI Business Finance, Inc. (the "Company" or "CSI")
entered into a Securities Purchase Agreement with Cornell Capital Partners, LP.
Pursuant to the Securities Purchase Agreement, the Company shall issue to
Cornell Capital Partners, LP, a total of $15,635,199 of secured convertible
debentures (the "Convertible Debentures"), which shall be convertible into
shares of the Company's common stock, par value $0.001. Out of total amount of
$15,635,199, $29,819 was previously funded under secured convertible debentures
issued in January 2003, $605,380 was previously funded under prior notes,
$8,500,000 consists of the sale of convertible debentures of Bio-One
Corporation, $500,000 consists of promissory notes which are held by Cornell
Capital Partners, LP, and $6,000,000 shall be funded on the fifth business day
following the date of execution of the Securities Purchase Agreement.
The Convertible Debentures accrue annual interest of five percent, have
three-year term and are secured by all the assets of the Company. The
Convertible Debentures are convertible at Cornell Capital Partners' option, at
any time until the Convertible Debentures have been fully paid, into shares of
the Company's common stock at a price per share equal to the lesser of (a) an
amount equal to 120% of the volume weighted average price of the Company's
common stock as listed on a principal market, as quoted by Bloomberg L.P. on
September 9, 2005, or (b) an amount equal to 80% of the average of the three
lowest volume weighted average price of the Company's common stock, as quoted by
Bloomberg, L.P., for the five trading days immediately preceding the date
specified by Cornell Capital Partners in its written notice of conversion to the
Company. The Convertible Debentures may be redeemed by the Company at any time,
in whole or in part, upon three business days advance notice to Cornell Capital
Partners. The redemption price shall be 106% of the amount redeemed plus accrued
interest.
In the event the Company exercises a redemption of either all or a portion
the Convertible Debenture, Cornell Capital Partners shall receive a warrant to
purchase 50,000 shares of the Company's common stock for every US$100,000
redeemed, pro rata. The warrant shall be exercisable on a "cash basis" and have
an exercise price of 120% of the Closing Bid Price, as defined therein, of the
Company's common stock on September 9, 2005. The warrant shall have "piggy-back"
and demand registration rights and shall survive for two years from September 9,
2005.
ITEM 3.02. UNREGISTERED SALES OF EQUITY SECURITIES
See Item 1.01
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS
(a) Not applicable.
(b) Not applicable.
(c) Exhibit No. Description.
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EXHIBIT DESCRIPTION LOCATION
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Exhibit 99.1 Securities Purchase Agreement dated as of September 9, 2005 between Provided herewith
the Company and Cornell Capital Partners, LP
Exhibit 99.2 Security Agreement dated as of September 9, 2005 between the Provided herewith
Company and Cornell Capital Partners, LP
Exhibit 99.3 Investor Registration Rights Agreement dated as of September 9, Provided herewith
2005 between the Company and Cornell Capital Partners, LP
Exhibit 99.4 Convertible Debenture dated as of September 9, 2005 issued to Provided herewith
Cornell Capital Partners, LP
Exhibit 99.5 Escrow Agreement dated September 9, 2005 among the Company, Cornell Provided herewith
Capital Partners, LP and David Gonzalez, Esq.
Exhibit 99.6 Assignment Agreement dated September 9, 2005 among the Company, Provided herewith
Cornell Capital Partners and Bio-One Corporation
Exhibit 99.7 Collateral Assignment Agreement dated September 9, 2005 between Provided herewith
the Company and Cornell Capital Partners, LP
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
Date: September 13, 2005 CSI BUSINESS FINANCE, INC.
By: /s/ Timothy J. Connolly
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Name: Timothy J. Connolly
Title: Chief Executive Officer
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