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
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Date of Report: September 2, 2005
Medical Staffing Solutions, Inc.
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(Exact Name of Registrant as Specified in Charter)
Nevada 000-23967 91-2135006
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
8150 Leesburg Pike, Suite 1200, Vienna, Virginia 22182
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(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (703) 641-8890
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ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
A. Securities Purchase Agreement
On September 2, 2005 Medical Staffing Solutions, Inc., a Nevada
corporation ("MSSI") entered into a Securities Purchase Agreement (the "Purchase
Agreement") whereby MSSI issued and sold to Cornell Capital Partners, LP (the
"Buyer" and together with MSSI, the "Parties"), and the Buyer purchased from
MSSI, up to Two Million One Hundred Thirteen Thousand Three Hundred Thirty Two
Dollars and 11/100 ($2,113,332.11) of secured convertible debentures (the
"Convertible Debenture"), which shall be convertible into shares of the
Company's common stock, par value $0.001 pursuant to the terms of the
Convertible Debenture, One Million Ninety Five Thousand Four Hundred Twenty
Eight Dollars and 88/100 ($1,095,428.88) (comprised of $1,072,164.38 in
principal and $23,264.50 in accrued interest) has previously been funded
pursuant to that certain promissory note dated January 5, 2005, as amended and
restated on June 7, 2005, and Five Hundred Seventy Thousand Nine Hundred Three
Dollars and Twenty Three Cents ($517,903.23) (comprised of $506,904.11 in
principal and $10,999.12 in accrued interest) has been previously funded
pursuant to that certain promissory note dated April 26, 2005, as amended and
restated on June 7, 2005. Such promissory notes shall simultaneously terminate
upon the issuance of the Convertible Debenture to the Buyer, and Five Hundred
Thousand Dollars ($500,000) has funded on the fifth (5th) business day following
the date of the execution of the Purchase Agreement, for a total purchase price
of up to Two Million One Hundred Thirteen Thousand Three Hundred Thirty Two
Dollars and 11/100 ($2,113,332.11).
The Convertible Debenture accrues interest at an annual rate of twelve
percent (12%), and MSSI will make monthly scheduled payments consisting of
principal and interest commencing January 1, 2006. The Debenture shall be
convertible into shares of our common stock at the option of the holder, in
whole or in part at any time and from time to time, at a conversion price of
$0.05 (subject to various adjustments pursuant to the terms of the Convertible
Debenture).
Contemporaneously with the execution and delivery of the Purchase
Agreement, the Parties executed a Registration Rights Agreement substantially in
the form attached as Exhibit A to the Purchase Agreement (the "Investor
Registration Rights Agreement") pursuant to which the Company agreed to provide
certain registration rights under the Securities Act and the rules and
regulations promulgated there under, and applicable state securities laws. The
aggregate proceeds of the sale of the Convertible Debenture contemplated hereby
shall be held in escrow pursuant to the terms of an escrow agreement (the
"Escrow Agreement") substantially in the form attached as Exhibit B to the
Purchase Agreement.
Contemporaneously with the execution and delivery of the Agreement, the
Parties have also executed a Security Agreement substantially in the form
attached as Exhibit C to the Purchase Agreement (the "Security Agreement")
pursuant to which the Company has agreed to provide the Buyer a security
interest in Pledged Collateral (as such term is defined in the Security
Agreement) to secure the Company's obligations under the Agreement, the
Convertible Debenture, the Investor Registration Rights Agreement, the
Irrevocable Transfer Agent Instructions (as such term is defined in the Purchase
Agreement), the Security Agreement, or any other obligations of the Company to
the Buyer.
B. Warrant
Effective August 10, 2005, MSSI issued to Cornell Capital Partners, LP a
common stock purchase warrant (the "Warrant") in connection with a commitment
for a $50,000,0000 Standby Equity Distribution Agreement and for Ten United
States Dollars ($10.00) and other good a valuable consideration. Cornell is
entitled to purchase from MSSI, upon surrender of the Warrant, Five Million
($5,000,000) fully paid and nonassessable shares of our common stock at an
exercise price of $0.05 (or as subsequently adjusted pursuant to the terms of
the Warrant). The Warrant shall expire three (3) years from the issuance date,
on or about August 10, 2008.
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Exhibit Description
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Exhibit 99.1 Securities Purchase Agreement, dated September 2, 2005, by and Provided herewith
between Medical Staffing Solutions, Inc. and Cornell Capital
Partners, LP
Exhibit 99.2 Secured Convertible Debenture, dated September 2, 2005, issued Provided herewith
by Medical Staffing Solutions, Inc. to Cornell Capital
Partners, LP
Exhibit 99.3 Investor Registration Rights Agreement, dated September 2, 2005, Provided herewith
by and between Medical Staffing Solutions, Inc. and Cornell
Capital Partners, LP
Exhibit 99.4 Escrow Agreement, dated September 2, 2005, by and between Provided herewith
Medical Staffing Solutions, Inc., Cornell Capital Partners, LP
and David Gonzalez, Esq., as Escrow Agent
Exhibit 99.5 Security Agreement, dated September 2, 2005, by and between Provided herewith
Medical Staffing Solutions, Inc. and Cornell Capital
Partners, LP
Exhibit 99.6 Irrevocable Transfer Agent Instructions, dated September 2, 2005 Provided herewith
Exhibit 99.7 Warrant, effective August 10, 2005, issued by Medical Staffing Provided herewith
Solutions, Inc. to Cornell Capital Partners, LP
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
MEDICAL STAFFING SOLUTIONS, INC.
Date: September 30, 2005 By: /s/ Dr. Brajnandan B. Sahay
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Name: Dr. Brajnandan B. Sahay
Title: President