GLOBAL SOURCES LTD
8-K, 2000-08-07
BLANK CHECKS
Previous: ARCHERY CAPITAL LLC, 13F-HR, 2000-08-07
Next: GLOBAL SOURCES LTD, 8-K, EX-2.1, 2000-08-07



                       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): August 7, 2000


                             GLOBAL SOURCES LIMITED
--------------------------------------------------------------------------------
               (Exact Name of Registrant as Specified in Charter)


           Delaware                     333-41389                13-4020643
           --------                     ----------               ----------
 (State or Other Jurisdiction          (Commission             (IRS Employer
       of Incorporation)                File No.)            Identification No.)


342 Madison Avenue, Suite 1815  New York, New York                    10173
--------------------------------------------------------------------------------
(Address of Principal Executive Offices)                             (Zip Code)


        Registrant's telephone number, including area code (212) 687-6363


                                 Not Applicable
--------------------------------------------------------------------------------
          (Former Name or Former Address, if Changed Since Last Report)


<PAGE>


ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS

         On July 21, 2000,  Global Sources Limited (the "Company")  acquired all
of the issued and outstanding  capital stock of Phillips & Chambers  Limited,  a
United  Kingdom  company  ("Phillips").  Phillips is the holding  company of The
McMillan  Partnership  Limited  ("McMillan"),  a  United  Kingdom  company  that
provides  training and  development  consultancy and services to a wide range of
global clients predominantly in the technology and  telecommunications  sectors,
including several Fortune and FT 100 companies.

         Pursuant  to  an  Agreement  dated  July  21,  2000  (the  "Acquisition
Agreement"),  by and among the Company, each of Angela Phillips,  Scott Chambers
and  Shawn  O'Rourke  (collectively,  the "A  Shareholders")  and each of Andrew
Maggs,  James Lawson and Patrick McGwire  (collectively,  the "B Shareholders"),
the A Shareholders and B Shareholders received, in proportion to their ownership
interest in Phillips,  a total of 1,101,816 and 261,817  shares of the Company's
common stock, par value $0.001 (the "Common Stock"),  respectively.  The parties
to the Acquisition  Agreement valued the total consideration paid by the Company
to have an aggregate value of $3 million.

         The  Acquisition  Agreement  also  provides for issuance of  additional
shares  of  the   Common   Stock  to  the  A   Shareholders   (the   "Additional
Consideration")  in each of the next three (3) years,  commencing June 30, 2001,
based upon  Phillips'  consolidated  earnings  before taxes  calculated  for the
twelve (12) month period  ending June 30th of each such year and the average bid
and ask price of the Common Stock. The aggregate value of Common Stock issued as
Additional Consideration over the three year period shall not exceed $5 million.

         The  Company  has  agreed  to file a  registration  statement  with the
Securities and Exchange Commission to register the shares of Common Stock issued
at the closing. The Company has also agreed to register the shares of Additional
Consideration after their issuance as soon as reasonably practicable.

         Under the  Acquisition  Agreement,  the Company  assumed the three-year
service agreements (the "Service Agreements") between Phillips and each of Scott
Chambers,  Angela  Phillips and Shawn O'Rourke (each an  "Executive") to oversee
the day-to-day operations, management and control of McMillan. Under the Service
Agreements,  each Executive will receive a base salary (being  (pound)80,000 for
Scott  Chambers  and Angela  Phillips  and  (pound)60,000  for Shawn  O'Rourke),
certain  benefits  and bonuses  based on  specific  performance  criteria.  Each
Service  Agreement can be terminated by the Company or the Executive on or after
June 30,  2003 upon  three (3) months  notice or by the  Company at any time for
reasons specified in the Service Agreements.  Under the Service Agreements, each
Executive has agreed not to compete with or to solicit the customers of Phillips
or McMillan during or after termination of employment.

         In  addition,  the  Company  has  agreed to invest  up to  $250,000  as
additional equity capital in Phillips during the next few months.

<PAGE>

         This acquisition is the Company's first European acquisition.

         The  descriptions  of the  Acquisition  Agreement and other  agreements
discussed above are qualified in their entirety by reference to such agreements,
which are attached as exhibits and/or incorporated herein by reference.

ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.

         (a)      Financial Statements of the Business Acquired.
                  ----------------------------------------------

                  Audited financial  statements relating to the acquisition will
be filed by amendment  within 60 days of the date this Report was required to be
filed.

         (b)      Pro Forma Financial Information and Exhibits.
                  ---------------------------------------------

                  Pro Forma  financial  information  relating to the acquisition
will be filed by  amendment  within 60 days of the date this Report was required
to be filed.

         (c)      Exhibits
                  --------

                  2.1      - Acquisition  Agreement dated as of July 21, 2000 by
                           and among the Company,  the A Shareholders  and the B
                           Shareholders.

                  10.1     -  Service  Agreement  by and  between  Phillips  and
                           Angela Phillips dated as of July 21, 2000.

                  10.2     - Service Agreement by and between Phillips and Scott
                           Chambers dated as of July 21, 2000.

                  10.3     - Service Agreement by and between Phillips and Shawn
                           O'Rourke dated as of July 21, 2000.


<PAGE>




                                   SIGNATURES

                  Pursuant to the requirements of the Securities Exchange Act of
1934, as amended, the registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.

Dated: August 7, 2000

                                   GLOBAL SOURCES LIMITED,
                                   a Delaware Corporation

                                   By: /s/ John Mazzuto
                                       Name: John Mazzuto
                                       Title:  President and Chief Financial
                                                 Officer


<PAGE>


                                  EXHIBIT INDEX
                                  -------------

Exhibit No.       Description
-----------       -----------

2.1               Acquisition  Agreement  dated as of July 21, 2000 by and among
                  the Company, the A Shareholders and the B Shareholders.

                  List of Omitted Exhibits and Schedules
                  --------------------------------------

                  2.2 - Disclosure Letter from the A Shareholders to the Company
                  3.1 - Articles of Association of Phillips  (Registered  Number
                  2658545)

10.1              Service Agreement by and between Phillips and Angela Phillips
                  dated as of July 21, 2000.

10.2              Service Agreement by and between Phillips and Scott Chambers
                  dated as of July 21, 2000.

10.3              Service Agreement by and between Phillips and Shawn O'Rourke
                  dated as of July 21, 2000.




© 2019 IncJournal is not affiliated with or endorsed by the U.S. Securities and Exchange Commission