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): January 4, 2005
KIWA BIO-TECH PRODUCTS GROUP CORPORATION
(Exact Name of Registrant as Specified in Charter)
DELAWARE 000-33167 84-0448400
(State or Other Jurisdiction (Commission (I.R.S. Employer
of Incorporation) File Number) Identification No.)
17700 CASTLETON STREET, SUITE 589
CITY OF INDUSTRY, CALIFORNIA 91748
(Address of Principal Executive Offices) (Zip Code)
(626) 964-3232
(Registrant's Telephone Number, Including Area Code)
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.
ITEM 2.03 CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION
UNDER AN OFF-BALANCE SHEET ARRANGEMENT OF A REGISTRANT.
On January 4, 2005, Kiwa Bio-Tech Products Group Corporation (the
"Company") completed a loan transaction pursuant to which the Company received
an advance of $400,000 (before deduction of expenses and fees) from Cornell
Capital Partners, LP in exchange for the issuance by the Company of a Promissory
Note in the original principal amount of $400,000 (the "Note"). The Note bears
interest at a rate of 10% per annum and has a term of 290 days. The Company's
obligations under the Note may be paid from, among other funds, the proceeds the
Company receives pursuant to that certain Standby Equity Distribution Agreement,
dated as of July 6, 2004, between the Company and Cornell Capital Partners.
Under the Standby Equity Distribution Agreement, the Company may, at
its discretion, periodically issue and sell to Cornell Capital Partners common
stock for a total purchase price of up to $10,000,000. The Company registered
the shares of common stock issuable under the Standby Equity Distribution
Agreement for resale by Cornell Capital Partners pursuant to Registration
Statement on Form SB-2 (No. 333-117868), which was declared effective by the
Securities and Exchange Commission in December 2004. In connection with the
Standby Equity Distribution Agreement, Cornell Capital Partners received a
one-time commitment fee of 704,038 shares of the Company's Common Stock. Other
than as set forth above, no other material relationship exists between Cornell
Capital Partners and the Company.
Pursuant to the terms of the Note, the Company will deposit in escrow
39 requests for advances under the Standby Equity Distribution Agreement in the
amount of $10,000 each and 1 request in the amount of $26,821.92, as well as
33,000,000 shares of the Company's Common Stock registered pursuant to the
Company's Registration Statement No. 333-117868. David Gonzales, Esq. will serve
as escrow agent in connection with the advance notices and shares to be
deposited in escrow pursuant to the Note. Unless the Note is prepaid by the
Company, the escrow agent will release such requests for advances to Cornell
Capital Partners every 7 days commencing on January 10, 2005 and Cornell Capital
Partners may then, at its discretion, apply the proceeds from the advance to the
outstanding balance on the Note.
In addition, the Note contains customary events of default and permits
Cornell Capital Partners to accelerate the maturity of the full principal amount
together with interest and other amounts owing upon the occurrence of such
events of default.
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SIGNATURE
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.
Date: January 6, 2005
KIWA BIO-TECH PRODUCTS GROUP CORPORATION
By: /s/ Wei Li
-----------------------------------------
Wei Li, Chief Executive Officer
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