UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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) October 11, 2005
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Money Centers of America, Inc.
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(Exact Name of Registrant as Specified in Charter)
Delaware 000-49723 23-2929364
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(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
700 South Henderson Road, Suite 325 King of Prussia, Pennsylvania 19406
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (610) 354-8888
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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 (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 2.03. Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant
From October 11, 2005 through October 14, 2005, the Registrant issued two
promissory notes in the aggregate amount of $50,000 to two individuals in
exchange for loans in the same amount. These notes bear interest at 10% per
annum, payable monthly, and all principal and interest is due at maturity after
nine months or earlier at the option of each holder upon a Change in Control.
"Change in Control" is defined as (i) a consolidation or merger of the
Registrant with or into any other corporation or corporations or any other
transaction in which the holders of the Registrant's outstanding shares of
capital stock immediately before such consolidation or merger do not,
immediately after such consolidation or merger, retain stock representing a
majority of the voting power of the surviving corporation of such consolidation
or merger, (ii) the sale of all or substantially all of the assets of the
Registrant or (iii) any occurrence as a result of which more than 50% of the
voting capital stock of the Registrant is held by a person or persons other than
a current holder or current holders of more than 50% of the voting capital stock
of the Registrant.
In the event that a Note is not repaid in full within ninety (90) days
following the maturity date, additional interest is due and payable in an amount
equal to twenty-five percent (25%) of the unpaid amount. Thereafter, additional
interest accrues each sixty (60) days in an amount equal to twenty-five percent
(25%) of the unpaid amount.
Each Note is convertible into shares of the Registrant's common stock at an
exercise price equal to 85% of the average of the mean of the closing "bid" and
"ask" prices of the Registrant's common stock for the ten (10) trading days
immediately prior to the date of exercise.
Each Note is subject to earlier repayment at the option of the holder upon
an event of default, which includes:
o The Registrant's failure to pay the principal of or accrued interest on or
late charges due under the Note within five (5) business days following the
date when due.
o The Registrant's default in any payment of principal of or interest on any
obligations for borrowed money (other than under the Note, or any such
obligation payable to the holder) or for the deferred purchase price of
property, if the effect is to cause, or to permit the holder of such
obligation to cause, such obligation to become due prior to its stated
maturity.
o The Registrant's voluntary or involuntary bankruptcy.
o Entry of one or more judgments against the Registrant in the aggregate
amount of Two Hundred Thousand ($200,000) or more, if the Registrant does
not obtain satisfaction, release, stay or dismissal within thirty (30) days
thereof.
In addition, the holders of the Notes were issued warrants to purchase an
aggregate of 25,000 shares of the Registrant's common stock at an exercise price
of $0.01 per share.
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 thereunto duly authorized.
MONEY CENTERS OF AMERICA, INC.
Date: October 17, 2005 By:/s/ Jason P. Walsh
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Jason P. Walsh
Chief Financial Officer