UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13G
(Rule 13d-102)
INFORMATION TO BE INCLUDED IN STATEMENTS
FILED PURSUANT TO RULE 13d-1(b), (c) AND (d)
AND AMENDMENTS THERETO FILED PURSUANT TO 13d-2(b)
(Amendment No. 1)*
CONVERSION SERVICES INTERNATIONAL, INC.
--------------------------------------------------------------------------------
(Name of Issuer)
Common Stock, par value $0.001 per share
--------------------------------------------------------------------------------
(Title of Class of Securities)
21254R208
--------------------------------------------------------------------------------
(CUSIP Number)
December 31, 2007
--------------------------------------------------------------------------------
(Date of Event Which Requires Filing of this Statement)
Check the appropriate box to designate the rule pursuant to which this Schedule
13G is filed:
[ ] Rule 13d-1(b)
[X] Rule 13d-1(c)
[ ] Rule 13d-1(d)
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter the
disclosures provided in a prior cover page.
The information required in the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
CUSIP No. 21254R208
--------------------------------------------------------------------------------
(1) Names of Reporting Persons. I.R.S. Identification Nos. of Above Persons
(entities only):
Laurus Master Fund, Ltd.
98-0337673
--------------------------------------------------------------------------------
(2) Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [ ]
(b) [X]
--------------------------------------------------------------------------------
(3) SEC Use Only
--------------------------------------------------------------------------------
(4) Citizenship or Place of Organization: Cayman Islands
--------------------------------------------------------------------------------
Number of Shares Beneficially Owned
by Each Reporting Person With (5) Sole Voting Power: 0*
--------------------------------------
(6) Shared Voting Power: 6,247,869*
--------------------------------------
(7) Sole Dispositive Power: 0*
--------------------------------------
(8) Shared Dispositive Power: 6,247,869*
--------------------------------------
--------------------------------------------------------------------------------
(9) Aggregate Amount Beneficially Owned by Each Reporting Person:
6,247,869
--------------------------------------------------------------------------------
(10) Check if the Aggregate Amount in Row (9) Excludes Certain Shares (See
Instructions): [X]
--------------------------------------------------------------------------------
(11) Percent of Class Represented by Amount in Row (9): 7.8%
--------------------------------------------------------------------------------
(12) Type of Reporting Person (See Instructions): CO
--------------------------------------------------------------------------------
* Based on 78,959,945 shares of common stock, $0.001 par value per share (the
"Shares") of Conversion Services International, Inc., a Delaware corporation
(the "Company") outstanding as of November 2, 2007, as disclosed on the
Company's Quarterly Report on Form 10-Q for the quarterly period ending
September 30, 2007. As of December 31, 2007, Laurus Master Fund, Ltd. (the
"Fund"), Valens U.S. SPV I, LLC ("Valens US"), and Valens Offshore SPV II, Corp.
("VOF" and together with Valens US and the Fund, the "Investors") collectively
held (i) 5,393,415 Shares, (ii) a warrant (as amended, the "August Warrant") to
acquire 800,000 Shares, at an exercise price of $4.35 per Share for the first
400,000 Shares acquired thereunder, $4.65 per Share for the next 200,000 Shares
acquired thereunder and $5.25 per Share for the remaining Shares acquired
thereunder, subject to certain adjustments, (iii) an option (as amended, the
"Option") to acquire 36,597 Shares at an exercise price of $0.001 per Share,
subject to certain adjustments, and (iv) a warrant (the "March Warrant", and
collectively with the Option and the August Warrant, the "Existing Instruments")
to acquire 17,857 Shares at an exercise price of $0.01 per Share, subject to
certain adjustments. The Existing Instruments each contain an issuance
limitation prohibiting the Investors from exercising those securities to the
extent that such exercise would result in beneficial ownership by the Investors
of more than 9.99% of the Shares then issued and outstanding (the "9.99%
Issuance Limitation"). The 9.99% Issuance Limitation under the August Warrant
and Option may be waived by the Investors upon 61 days prior notice to the
Company and shall, in connection with the Warrants and Option, automatically
become null and void following notice to the Company of the occurrence and/or
continuance of an event of default (as defined in and pursuant to the terms of
the applicable instrument). The Fund is managed by Laurus Capital Management,
LLC. Valens US and VOF are managed by Valens Capital Management, LLC. Eugene
Grin and David Grin, through other entities, are the controlling principals of
Laurus Capital Management, LLC and Valens Capital Management, LLC and share sole
voting and investment power over the securities owned by the Investors reported
in this Schedule 13G, as amended.
CUSIP No. 21254R208
--------------------------------------------------------------------------------
(1) Names of Reporting Persons. I.R.S. Identification Nos. of Above Persons
(entities only):
Laurus Capital Management, LLC
13-4150669
--------------------------------------------------------------------------------
(2) Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [ ]
(b) [X]
--------------------------------------------------------------------------------
(3) SEC Use Only
--------------------------------------------------------------------------------
(4) Citizenship or Place of Organization: Delaware
--------------------------------------------------------------------------------
Number of Shares Beneficially Owned
by Each Reporting Person With (5) Sole Voting Power: 0*
--------------------------------------
(6) Shared Voting Power: 6,247,869*
--------------------------------------
(7) Sole Dispositive Power: 0*
--------------------------------------
(8) Shared Dispositive Power: 6,247,869*
--------------------------------------
--------------------------------------------------------------------------------
(9) Aggregate Amount Beneficially Owned by Each Reporting Person:
6,247,869
--------------------------------------------------------------------------------
(10) Check if the Aggregate Amount in Row (9) Excludes Certain Shares (See
Instructions): [X]
--------------------------------------------------------------------------------
(11) Percent of Class Represented by Amount in Row (9): 7.8%
--------------------------------------------------------------------------------
(12) Type of Reporting Person (See Instructions): OO
--------------------------------------------------------------------------------
* Based on 78,959,945 shares of common stock, $0.001 par value per share (the
"Shares") of Conversion Services International, Inc., a Delaware corporation
(the "Company") outstanding as of November 2, 2007, as disclosed on the
Company's Quarterly Report on Form 10-Q for the quarterly period ending
September 30, 2007. As of December 31, 2007, Laurus Master Fund, Ltd. (the
"Fund"), Valens U.S. SPV I, LLC ("Valens US"), and Valens Offshore SPV II, Corp.
("VOF" and together with Valens US and the Fund, the "Investors") collectively
held (i) 5,393,415 Shares, (ii) a warrant (as amended, the "August Warrant") to
acquire 800,000 Shares, at an exercise price of $4.35 per Share for the first
400,000 Shares acquired thereunder, $4.65 per Share for the next 200,000 Shares
acquired thereunder and $5.25 per Share for the remaining Shares acquired
thereunder, subject to certain adjustments, (iii) an option (as amended, the
"Option") to acquire 36,597 Shares at an exercise price of $0.001 per Share,
subject to certain adjustments, and (iv) a warrant (the "March Warrant", and
collectively with the Option and the August Warrant, the "Existing Instruments")
to acquire 17,857 Shares at an exercise price of $0.01 per Share, subject to
certain adjustments. The Existing Instruments each contain an issuance
limitation prohibiting the Investors from exercising those securities to the
extent that such exercise would result in beneficial ownership by the Investors
of more than 9.99% of the Shares then issued and outstanding (the "9.99%
Issuance Limitation"). The 9.99% Issuance Limitation under the August Warrant
and Option may be waived by the Investors upon 61 days prior notice to the
Company and shall, in connection with the Warrants and Option, automatically
become null and void following notice to the Company of the occurrence and/or
continuance of an event of default (as defined in and pursuant to the terms of
the applicable instrument). The Fund is managed by Laurus Capital Management,
LLC. Valens US and VOF are managed by Valens Capital Management, LLC. Eugene
Grin and David Grin, through other entities, are the controlling principals of
Laurus Capital Management, LLC and Valens Capital Management, LLC and share sole
voting and investment power over the securities owned by the Investors reported
in this Schedule 13G, as amended.
CUSIP No. 21254R208
--------------------------------------------------------------------------------
(1) Names of Reporting Persons. I.R.S. Identification Nos. of Above Persons
(entities only):
Valens U.S. SPV I, LLC
20-8903266
--------------------------------------------------------------------------------
(2) Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [ ]
(b) [X]
--------------------------------------------------------------------------------
(3) SEC Use Only
--------------------------------------------------------------------------------
(4) Citizenship or Place of Organization: Delaware
--------------------------------------------------------------------------------
Number of Shares Beneficially Owned
by Each Reporting Person With (5) Sole Voting Power: 0*
--------------------------------------
(6) Shared Voting Power: 6,247,869*
--------------------------------------
(7) Sole Dispositive Power: 0*
--------------------------------------
(8) Shared Dispositive Power: 6,247,869*
--------------------------------------
--------------------------------------------------------------------------------
(9) Aggregate Amount Beneficially Owned by Each Reporting Person:
6,247,869
--------------------------------------------------------------------------------
(10) Check if the Aggregate Amount in Row (9) Excludes Certain Shares (See
Instructions): [X]
--------------------------------------------------------------------------------
(11) Percent of Class Represented by Amount in Row (9): 7.8%
--------------------------------------------------------------------------------
(12) Type of Reporting Person (See Instructions): OO
--------------------------------------------------------------------------------
* Based on 78,959,945 shares of common stock, $0.001 par value per share (the
"Shares") of Conversion Services International, Inc., a Delaware corporation
(the "Company") outstanding as of November 2, 2007, as disclosed on the
Company's Quarterly Report on Form 10-Q for the quarterly period ending
September 30, 2007. As of December 31, 2007, Laurus Master Fund, Ltd. (the
"Fund"), Valens U.S. SPV I, LLC ("Valens US"), and Valens Offshore SPV II, Corp.
("VOF" and together with Valens US and the Fund, the "Investors") collectively
held (i) 5,393,415 Shares, (ii) a warrant (as amended, the "August Warrant") to
acquire 800,000 Shares, at an exercise price of $4.35 per Share for the first
400,000 Shares acquired thereunder, $4.65 per Share for the next 200,000 Shares
acquired thereunder and $5.25 per Share for the remaining Shares acquired
thereunder, subject to certain adjustments, (iii) an option (as amended, the
"Option") to acquire 36,597 Shares at an exercise price of $0.001 per Share,
subject to certain adjustments, and (iv) a warrant (the "March Warrant", and
collectively with the Option and the August Warrant, the "Existing Instruments")
to acquire 17,857 Shares at an exercise price of $0.01 per Share, subject to
certain adjustments. The Existing Instruments each contain an issuance
limitation prohibiting the Investors from exercising those securities to the
extent that such exercise would result in beneficial ownership by the Investors
of more than 9.99% of the Shares then issued and outstanding (the "9.99%
Issuance Limitation"). The 9.99% Issuance Limitation under the August Warrant
and Option may be waived by the Investors upon 61 days prior notice to the
Company and shall, in connection with the Warrants and Option, automatically
become null and void following notice to the Company of the occurrence and/or
continuance of an event of default (as defined in and pursuant to the terms of
the applicable instrument). The Fund is managed by Laurus Capital Management,
LLC. Valens US and VOF are managed by Valens Capital Management, LLC. Eugene
Grin and David Grin, through other entities, are the controlling principals of
Laurus Capital Management, LLC and Valens Capital Management, LLC and share sole
voting and investment power over the securities owned by the Investors reported
in this Schedule 13G, as amended.
CUSIP No. 21254R208
--------------------------------------------------------------------------------
(1) Names of Reporting Persons. I.R.S. Identification Nos. of Above Persons
(entities only):
Valens Offshore SPV II, Corp.
26-0811267
--------------------------------------------------------------------------------
(2) Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [ ]
(b) [X]
--------------------------------------------------------------------------------
(3) SEC Use Only
--------------------------------------------------------------------------------
(4) Citizenship or Place of Organization: Delaware
--------------------------------------------------------------------------------
Number of Shares Beneficially Owned
by Each Reporting Person With (5) Sole Voting Power: 0*
--------------------------------------
(6) Shared Voting Power: 6,247,869*
--------------------------------------
(7) Sole Dispositive Power: 0*
--------------------------------------
(8) Shared Dispositive Power: 6,247,869*
--------------------------------------
--------------------------------------------------------------------------------
(9) Aggregate Amount Beneficially Owned by Each Reporting Person:
6,247,869
--------------------------------------------------------------------------------
(10) Check if the Aggregate Amount in Row (9) Excludes Certain Shares (See
Instructions): [X]
--------------------------------------------------------------------------------
(11) Percent of Class Represented by Amount in Row (9): 7.8%
--------------------------------------------------------------------------------
(12) Type of Reporting Person (See Instructions): OO
--------------------------------------------------------------------------------
* Based on 78,959,945 shares of common stock, $0.001 par value per share (the
"Shares") of Conversion Services International, Inc., a Delaware corporation
(the "Company") outstanding as of November 2, 2007, as disclosed on the
Company's Quarterly Report on Form 10-Q for the quarterly period ending
September 30, 2007. As of December 31, 2007, Laurus Master Fund, Ltd. (the
"Fund"), Valens U.S. SPV I, LLC ("Valens US"), and Valens Offshore SPV II, Corp.
("VOF" and together with Valens US and the Fund, the "Investors") collectively
held (i) 5,393,415 Shares, (ii) a warrant (as amended, the "August Warrant") to
acquire 800,000 Shares, at an exercise price of $4.35 per Share for the first
400,000 Shares acquired thereunder, $4.65 per Share for the next 200,000 Shares
acquired thereunder and $5.25 per Share for the remaining Shares acquired
thereunder, subject to certain adjustments, (iii) an option (as amended, the
"Option") to acquire 36,597 Shares at an exercise price of $0.001 per Share,
subject to certain adjustments, and (iv) a warrant (the "March Warrant", and
collectively with the Option and the August Warrant, the "Existing Instruments")
to acquire 17,857 Shares at an exercise price of $0.01 per Share, subject to
certain adjustments. The Existing Instruments each contain an issuance
limitation prohibiting the Investors from exercising those securities to the
extent that such exercise would result in beneficial ownership by the Investors
of more than 9.99% of the Shares then issued and outstanding (the "9.99%
Issuance Limitation"). The 9.99% Issuance Limitation under the August Warrant
and Option may be waived by the Investors upon 61 days prior notice to the
Company and shall, in connection with the Warrants and Option, automatically
become null and void following notice to the Company of the occurrence and/or
continuance of an event of default (as defined in and pursuant to the terms of
the applicable instrument). The Fund is managed by Laurus Capital Management,
LLC. Valens US and VOF are managed by Valens Capital Management, LLC. Eugene
Grin and David Grin, through other entities, are the controlling principals of
Laurus Capital Management, LLC and Valens Capital Management, LLC and share sole
voting and investment power over the securities owned by the Investors reported
in this Schedule 13G, as amended.
CUSIP No. 21254R208
--------------------------------------------------------------------------------
(1) Names of Reporting Persons. I.R.S. Identification Nos. of Above Persons
(entities only):
Valens Capital Management, LLC
20-8903345
--------------------------------------------------------------------------------
(2) Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [ ]
(b) [X]
--------------------------------------------------------------------------------
(3) SEC Use Only
--------------------------------------------------------------------------------
(4) Citizenship or Place of Organization: Delaware
--------------------------------------------------------------------------------
Number of Shares Beneficially Owned
by Each Reporting Person With (5) Sole Voting Power: 0*
--------------------------------------
(6) Shared Voting Power: 6,247,869*
--------------------------------------
(7) Sole Dispositive Power: 0*
--------------------------------------
(8) Shared Dispositive Power: 6,247,869*
--------------------------------------
--------------------------------------------------------------------------------
(9) Aggregate Amount Beneficially Owned by Each Reporting Person:
6,247,869
--------------------------------------------------------------------------------
(10) Check if the Aggregate Amount in Row (9) Excludes Certain Shares (See
Instructions): [X]
--------------------------------------------------------------------------------
(11) Percent of Class Represented by Amount in Row (9): 7.8%
--------------------------------------------------------------------------------
(12) Type of Reporting Person (See Instructions): OO
--------------------------------------------------------------------------------
* Based on 78,959,945 shares of common stock, $0.001 par value per share (the
"Shares") of Conversion Services International, Inc., a Delaware corporation
(the "Company") outstanding as of November 2, 2007, as disclosed on the
Company's Quarterly Report on Form 10-Q for the quarterly period ending
September 30, 2007. As of December 31, 2007, Laurus Master Fund, Ltd. (the
"Fund"), Valens U.S. SPV I, LLC ("Valens US"), and Valens Offshore SPV II, Corp.
("VOF" and together with Valens US and the Fund, the "Investors") collectively
held (i) 5,393,415 Shares, (ii) a warrant (as amended, the "August Warrant") to
acquire 800,000 Shares, at an exercise price of $4.35 per Share for the first
400,000 Shares acquired thereunder, $4.65 per Share for the next 200,000 Shares
acquired thereunder and $5.25 per Share for the remaining Shares acquired
thereunder, subject to certain adjustments, (iii) an option (as amended, the
"Option") to acquire 36,597 Shares at an exercise price of $0.001 per Share,
subject to certain adjustments, and (iv) a warrant (the "March Warrant", and
collectively with the Option and the August Warrant, the "Existing Instruments")
to acquire 17,857 Shares at an exercise price of $0.01 per Share, subject to
certain adjustments. The Existing Instruments each contain an issuance
limitation prohibiting the Investors from exercising those securities to the
extent that such exercise would result in beneficial ownership by the Investors
of more than 9.99% of the Shares then issued and outstanding (the "9.99%
Issuance Limitation"). The 9.99% Issuance Limitation under the August Warrant
and Option may be waived by the Investors upon 61 days prior notice to the
Company and shall, in connection with the Warrants and Option, automatically
become null and void following notice to the Company of the occurrence and/or
continuance of an event of default (as defined in and pursuant to the terms of
the applicable instrument). The Fund is managed by Laurus Capital Management,
LLC. Valens US and VOF are managed by Valens Capital Management, LLC. Eugene
Grin and David Grin, through other entities, are the controlling principals of
Laurus Capital Management, LLC and Valens Capital Management, LLC and share sole
voting and investment power over the securities owned by the Investors reported
in this Schedule 13G, as amended.
CUSIP No. 21254R208
--------------------------------------------------------------------------------
(1) Names of Reporting Persons. I.R.S. Identification Nos. of Above Persons
(entities only):
David Grin
--------------------------------------------------------------------------------
(2) Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [ ]
(b) [X]
--------------------------------------------------------------------------------
(3) SEC Use Only
--------------------------------------------------------------------------------
(4) Citizenship or Place of Organization: Israel
--------------------------------------------------------------------------------
Number of Shares Beneficially Owned
by Each Reporting Person With (5) Sole Voting Power: 0*
--------------------------------------
(6) Shared Voting Power: 6,247,869*
--------------------------------------
(7) Sole Dispositive Power: 0*
--------------------------------------
(8) Shared Dispositive Power: 6,247,869*
--------------------------------------
--------------------------------------------------------------------------------
(9) Aggregate Amount Beneficially Owned by Each Reporting Person:
6,247,869
--------------------------------------------------------------------------------
(10) Check if the Aggregate Amount in Row (9) Excludes Certain Shares (See
Instructions): [X]
--------------------------------------------------------------------------------
(11) Percent of Class Represented by Amount in Row (9): 7.8%
--------------------------------------------------------------------------------
(12) Type of Reporting Person (See Instructions): IN
--------------------------------------------------------------------------------
* Based on 78,959,945 shares of common stock, $0.001 par value per share (the
"Shares") of Conversion Services International, Inc., a Delaware corporation
(the "Company") outstanding as of November 2, 2007, as disclosed on the
Company's Quarterly Report on Form 10-Q for the quarterly period ending
September 30, 2007. As of December 31, 2007, Laurus Master Fund, Ltd. (the
"Fund"), Valens U.S. SPV I, LLC ("Valens US"), and Valens Offshore SPV II, Corp.
("VOF" and together with Valens US and the Fund, the "Investors") collectively
held (i) 5,393,415 Shares, (ii) a warrant (as amended, the "August Warrant") to
acquire 800,000 Shares, at an exercise price of $4.35 per Share for the first
400,000 Shares acquired thereunder, $4.65 per Share for the next 200,000 Shares
acquired thereunder and $5.25 per Share for the remaining Shares acquired
thereunder, subject to certain adjustments, (iii) an option (as amended, the
"Option") to acquire 36,597 Shares at an exercise price of $0.001 per Share,
subject to certain adjustments, and (iv) a warrant (the "March Warrant", and
collectively with the Option and the August Warrant, the "Existing Instruments")
to acquire 17,857 Shares at an exercise price of $0.01 per Share, subject to
certain adjustments. The Existing Instruments each contain an issuance
limitation prohibiting the Investors from exercising those securities to the
extent that such exercise would result in beneficial ownership by the Investors
of more than 9.99% of the Shares then issued and outstanding (the "9.99%
Issuance Limitation"). The 9.99% Issuance Limitation under the August Warrant
and Option may be waived by the Investors upon 61 days prior notice to the
Company and shall, in connection with the Warrants and Option, automatically
become null and void following notice to the Company of the occurrence and/or
continuance of an event of default (as defined in and pursuant to the terms of
the applicable instrument). The Fund is managed by Laurus Capital Management,
LLC. Valens US and VOF are managed by Valens Capital Management, LLC. Eugene
Grin and David Grin, through other entities, are the controlling principals of
Laurus Capital Management, LLC and Valens Capital Management, LLC and share sole
voting and investment power over the securities owned by the Investors reported
in this Schedule 13G, as amended.
CUSIP No. 21254R208
--------------------------------------------------------------------------------
(1) Names of Reporting Persons. I.R.S. Identification Nos. of Above Persons
(entities only):
Eugene Grin
--------------------------------------------------------------------------------
(2) Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [ ]
(b) [X]
--------------------------------------------------------------------------------
(3) SEC Use Only
--------------------------------------------------------------------------------
(4) Citizenship or Place of Organization: United States
--------------------------------------------------------------------------------
Number of Shares Beneficially Owned
by Each Reporting Person With (5) Sole Voting Power: 0*
--------------------------------------
(6) Shared Voting Power: 6,247,869*
--------------------------------------
(7) Sole Dispositive Power: 0*
--------------------------------------
(8) Shared Dispositive Power: 6,247,869*
--------------------------------------
--------------------------------------------------------------------------------
(9) Aggregate Amount Beneficially Owned by Each Reporting Person:
6,247,869
--------------------------------------------------------------------------------
(10) Check if the Aggregate Amount in Row (9) Excludes Certain Shares (See
Instructions): [X]
--------------------------------------------------------------------------------
(11) Percent of Class Represented by Amount in Row (9): 7.8%
--------------------------------------------------------------------------------
(12) Type of Reporting Person (See Instructions): IN
--------------------------------------------------------------------------------
* Based on 78,959,945 shares of common stock, $0.001 par value per share (the
"Shares") of Conversion Services International, Inc., a Delaware corporation
(the "Company") outstanding as of November 2, 2007, as disclosed on the
Company's Quarterly Report on Form 10-Q for the quarterly period ending
September 30, 2007. As of December 31, 2007, Laurus Master Fund, Ltd. (the
"Fund"), Valens U.S. SPV I, LLC ("Valens US"), and Valens Offshore SPV II, Corp.
("VOF" and together with Valens US and the Fund, the "Investors") collectively
held (i) 5,393,415 Shares, (ii) a warrant (as amended, the "August Warrant") to
acquire 800,000 Shares, at an exercise price of $4.35 per Share for the first
400,000 Shares acquired thereunder, $4.65 per Share for the next 200,000 Shares
acquired thereunder and $5.25 per Share for the remaining Shares acquired
thereunder, subject to certain adjustments, (iii) an option (as amended, the
"Option") to acquire 36,597 Shares at an exercise price of $0.001 per Share,
subject to certain adjustments, and (iv) a warrant (the "March Warrant", and
collectively with the Option and the August Warrant, the "Existing Instruments")
to acquire 17,857 Shares at an exercise price of $0.01 per Share, subject to
certain adjustments. The Existing Instruments each contain an issuance
limitation prohibiting the Investors from exercising those securities to the
extent that such exercise would result in beneficial ownership by the Investors
of more than 9.99% of the Shares then issued and outstanding (the "9.99%
Issuance Limitation"). The 9.99% Issuance Limitation under the August Warrant
and Option may be waived by the Investors upon 61 days prior notice to the
Company and shall, in connection with the Warrants and Option, automatically
become null and void following notice to the Company of the occurrence and/or
continuance of an event of default (as defined in and pursuant to the terms of
the applicable instrument). The Fund is managed by Laurus Capital Management,
LLC. Valens US and VOF are managed by Valens Capital Management, LLC. Eugene
Grin and David Grin, through other entities, are the controlling principals of
Laurus Capital Management, LLC and Valens Capital Management, LLC and share sole
voting and investment power over the securities owned by the Investors reported
in this Schedule 13G, as amended.
CUSIP No. 21254R208
Item 1(a). Name Of Issuer: Conversion Services International, Inc.
Item 1(b). Address of Issuer's Principal Executive Offices:
100 Eagle Rock Avenue
East Hanover, New Jersey 07936
Item 2(a). Name of Person Filing:
Laurus Master Fund, Ltd.
This Schedule 13G, as amended, is also filed on behalf of Laurus
Capital Management, LLC, a Delaware limited liability company, Valens
U.S. SPV I, LLC, a Delaware limited liability company, Valens Offshore
SPV II, Corp., a Delaware corporation, Valens Capital Management, LLC,
a Delaware limited liability company, Eugene Grin and David Grin.
Laurus Capital Management, LLC manages Laurus Master Fund, Ltd. Valens
Capital Management, LLC manages Valens U.S. SPV I, LLC and Valens
Offshore SPV II, Corp. Eugene Grin and David Grin, through other
entities, are the controlling principals of Laurus Capital Management,
LLC and Valens Capital Management, LLC and share sole voting and
investment power over the securities owned by Laurus Master Fund, Ltd,
Valens U.S. SPV I, LLC and Valens Offshore SPV II, Corp. reported in
this Schedule 13G, as amended. Information related to each of Laurus
Capital Management, LLC, Valens U.S. SPV I, LLC, Valens Offshore SPV
II, Corp., Valens Capital Management, LLC, Eugene Grin and David Grin
is set forth on Appendix A hereto.
Item 2(b). Address of Principal Business Office or, if None, Residence:
c/o Laurus Capital Management, LLC,
335 Madison Avenue, 10th Floor
New York, NY 10017
Item 2(c). Citizenship:
Cayman Islands
Item 2(d). Title of Class of Securities: Common Stock ("Common Stock")
Item 2(e). CUSIP No.: 21254R208
Item 3. If This Statement Is Filed Pursuant to Sections 240.13d-1(b) or
240.13d-2(b) or (c), check whether the Person Filing is a:
Not Applicable.
Item 4. Ownership
(a) Amount Beneficially Owned: 6,247,869
(b) Percent of Class: 7.8%
(c) Number of Shares as to which the person has:
(i) sole power to vote or to direct the vote 0*
(ii) shared power to vote or to direct the vote 6,247,869*
(iii) sole power to dispose or to direct the
disposition of 0*
(iv) shared power to dispose or to direct the
disposition of 6,247,869*
-------------------
* Based on 78,959,945 shares of common stock, $0.001 par value per share (the
"Shares") of Conversion Services International, Inc., a Delaware corporation
(the "Company") outstanding as of November 2, 2007, as disclosed on the
Company's Quarterly Report on Form 10-Q for the quarterly period ending
September 30, 2007. As of December 31, 2007, Laurus Master Fund, Ltd. (the
"Fund"), Valens U.S. SPV I, LLC ("Valens US"), and Valens Offshore SPV II, Corp.
("VOF" and together with Valens US and the Fund, the "Investors") collectively
held (i) 5,393,415 Shares, (ii) a warrant (as amended, the "August Warrant") to
acquire 800,000 Shares, at an exercise price of $4.35 per Share for the first
400,000 Shares acquired thereunder, $4.65 per Share for the next 200,000 Shares
acquired thereunder and $5.25 per Share for the remaining Shares acquired
thereunder, subject to certain adjustments, (iii) an option (as amended, the
"Option") to acquire 36,597 Shares at an exercise price of $0.001 per Share,
subject to certain adjustments, and (iv) a warrant (the "March Warrant", and
collectively with the Option and the August Warrant, the "Existing Instruments")
to acquire 17,857 Shares at an exercise price of $0.01 per Share, subject to
certain adjustments. The Existing Instruments each contain an issuance
limitation prohibiting the Investors from exercising those securities to the
extent that such exercise would result in beneficial ownership by the Investors
of more than 9.99% of the Shares then issued and outstanding (the "9.99%
Issuance Limitation"). The 9.99% Issuance Limitation under the August Warrant
and Option may be waived by the Investors upon 61 days prior notice to the
Company and shall, in connection with the Warrants and Option, automatically
become null and void following notice to the Company of the occurrence and/or
continuance of an event of default (as defined in and pursuant to the terms of
the applicable instrument). The Fund is managed by Laurus Capital Management,
LLC. Valens US and VOF are managed by Valens Capital Management, LLC. Eugene
Grin and David Grin, through other entities, are the controlling principals of
Laurus Capital Management, LLC and Valens Capital Management, LLC and share sole
voting and investment power over the securities owned by the Investors reported
in this Schedule 13G, as amended.
Item 5. Ownership of Five Percent or Less of a Class
Not applicable
Item 6. Ownership of More Than Five Percent on Behalf of Another Person
Not Applicable.
Item 7. Identification and Classification of the Subsidiary Which Acquired
the Security Being Reported on by the Parent Holding Company or Control
Person
Not Applicable.
Item 8. Identification and Classification of Members of the Group
Not Applicable.
Item 9. Notice of Dissolution of Group
Not Applicable.
Item 10. Certification
By signing below I certify that, to the best of my knowledge and
belief, the securities referred to above were not acquired and are not held for
the purpose of or with the effect of changing or influencing the control of the
issuer of the securities and were not acquired and are not held in connection
with or as a participant in any transaction having that purpose or effect.
SIGNATURE
---------
After reasonable inquiry and to the best of my knowledge and belief,
I certify that the information set forth in this statement is true, complete and
correct.
February 14, 2008
----------------
Date
LAURUS MASTER FUND, LTD.
By: /s/ David Grin
-------------------------------
Name: David Grin
Title: Director
Attention: Intentional misstatements or omissions of fact constitute
Federal criminal violations (See 18 U.S.C. 1001)
CUSIP No. 21254R208
APPENDIX A
A. Name: Laurus Capital Management, LLC, a Delaware limited
liability company
Address: 335 Madison Avenue, 10th Floor
New York, New York 10017
Place of
Organization: Delaware
B. Name: Valens U.S. SPV I, LLC, a Delaware limited liability
Company
Address: c/o Laurus Capital Management, LLC
335 Madison Avenue, 10th Floor
New York, New York 10017
Place of
Organization: Delaware
C. Name: Valens Offshore SPV II, Corp., a Delaware corporation
Address: c/o Laurus Capital Management, LLC
335 Madison Avenue, 10th Floor
New York, New York 10017
Place of
Organization: Delaware
D. Name: Valens Capital Management, LLC, a Delaware
limited liability company
Address: c/o Laurus Capital Management, LLC
335 Madison Avenue, 10th Floor
New York, New York 10017
Place of
Organization: Delaware
E. Name: David Grin
Business 335 Madison Avenue, 10th Floor
Address: New York, New York 10017
Principal Director of Laurus Master Fund, Ltd.
Occupation: Principal of Laurus Capital Management, LLC
Citizenship: Israel
F. Name: Eugene Grin
Business 335 Madison Avenue, 10th Floor
Address: New York, New York 10017
Principal Director of Laurus Master Fund, Ltd.
Occupation: Principal of Laurus Capital Management, LLC
Citizenship: United States
CUSIP No. 21254R208
Each of Laurus Capital Management, LLC, Valens U.S. SPV I, LLC, Valens Offshore
SPV II, Corp., Eugene Grin and David Grin hereby agree, by their execution
below, that the Schedule 13G to which this Appendix A is attached is filed on
behalf of each of them, respectively.
Laurus Capital Management, LLC
/s/ David Grin
---------------------------------
David Grin
Principal
February 14, 2008
Valens U.S. SPV I, LLC
Valens Offshore SPV II, Corp.
By Valens Capital Management, LLC, individually and as investment manager
/s/ David Grin
---------------------------------
David Grin
Authorized Signatory
February 14, 2008
/s/ David Grin
---------------------------------
David Grin, on his individual behalf
February 14, 2008
/s/ Eugene Grin
---------------------------------
Eugene Grin, on his individual behalf
February 14, 2008