UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 21, 2006
Science Dynamics Corporation
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(Exact name of registrant as specified in its charter)
Delaware 000-10690 22-2011859
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(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
7150 N. Park Drive, Suite 500
Pennsauken, NJ 08109
(Address of principal executive offices and Zip Code)
Registrant's telephone number, including area code: (856) 910-1166
Copies to:
Gregory Sichenzia, Esq.
Sichenzia Ross Friedman Ference LLP
1065 Avenue of the Americas
New York, New York 10018
Phone: (212) 930-9700
Fax: (212) 930-9725
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 (see General Instruction A.2. below):
[ ] 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 a Material Definitive Agreement.
On July 21, 2006, Science Dynamics Corporation (the "Company") entered
into a Forbearance Agreement with Laurus Master Fund, Ltd. ("Laurus"). Pursuant
to the Agreement, Laurus waived certain Events of Default under the Secured Term
Note dated February 11, 2005 (the "Term Note") and the related documents
executed in connection with the Term Note and forebear from enforcing its
remedies as a result of the occurrence of the events of default. The Company
agreed to repay $500,000 and issue 1,000,000 shares of its common stock to
Laurus upon execution of the Forbearance Agreement. Upon receipt of the
foregoing by Laurus, together with a duly executed counterpart of the
Forbearance Agreement, the parties agreed that the Registration Rights Agreement
executed by the parties in connection with the Term Note shall be immediately
terminated.
In addition, pursuant to the terms of the Forbearance Agreement, the
Company agreed to repay $250,000 in cash to Laurus on or before August 1, 2006
and agreed to issue an additional 8,333,333 shares of its common stock and repay
$750,000 to Laurus on or before August 31, 2006. To the extent the Forbearance
Agreement constitutes an amendment to the 2005 Financing Documents, the parties
agreed to amend the Purchase Agreement as set forth in the Forbearance Agreement
and to amend and restate the Term Note, the Initial Warrant and Additional
Warrant. The Amended and Restated Term Note, the Amended and Restated Initial
Warrant and the Amended and Restated Additional Warrant are attached hereto as
exhibits.
The shares issuable pursuant to the Forbearance Agreement will be issued
pursuant to the exemption from registration provided by Section 4(2) of the
Securities Act of 1933, as amended, and Rule 506 of Regulation D promulgated
thereunder.
Item 3.02 Unregistered Sales of Equity Securities.
See Item 1.01 above.
Item 9.01 Financial Statements and Exhibits.
(c) Exhibits.
Exhibit
Number Description
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4.1 Amended and Restated Term Note
4.2 Amended and Restated Initial Warrant
4.3 Amended and Restated Additional Warrant
10.1 Forbearance Agreement between Science Dynamics
Corporation and Laurus Master Fund
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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.
Science Dynamics Corporation
Date: July 27, 2006 /s/ Paul Burgess
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Paul Burgess
Chief Executive Officer
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