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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): AUGUST 15, 2000
COMPASS KNOWLEDGE HOLDINGS, INC.
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(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
NEVADA 0-29615 87-0471549
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(STATE OR OTHER JURISDICTION (COMMISSION FILE (IRS EMPLOYER
OF INCORPORATION OR NUMBER) IDENTIFICATION NUMBER)
ORGANIZATION)
2710 REW CIRCLE, SUITE 100
OCOEE, FLORIDA 34761
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(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES INCLUDING ZIP CODE)
(407) 656-3906
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(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
(407) 656-7585
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(REGISTRANT'S FACSIMILE NUMBER, INCLUDING AREA CODE)
WWW.COMPASSKNOWLEDGE.COM
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(REGISTRANT'S WEBSITE ADDRESS)
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ITEM 2 ACQUISITION OR DISPOSITION OF ASSETS
On August 15, 2000, we completed the acquisition of the outstanding capital
stock of Jamita, Inc., a distance learning leadership development services firm
headquartered in Cincinnati, Ohio. The capital stock was acquired from a group
of employee shareholders and their family members who had no prior relationships
with us. The purchase price of $1.875 million (before contingent consideration)
was paid solely in cash. In addition, 562,500 shares of our common stock valued
at $2.00 per share (which is approximately the average closing price of the
stock for the 20-day period ended August 14, 2000) was placed into an escrow
account for distribution to the Jamita shareholders subject to Jamita having net
collections of approximately $1 million in the first fiscal year following the
closing. We may also make additional payments if certain net collection goals
are achieved in each of the first two fiscal years following the closing. The
acquisition has been accounted for using the purchase method of accounting.
On August 15, 2000, we also completed the acquisition of the outstanding capital
stock of Rutherford Learning Group, Inc., ("RLG"), an educational leadership and
professional development company services firm headquartered in Charlotte, North
Carolina. RLG, through a consulting agreement, provides Jamita with onsite
consulting and video presentation materials for its K-12 leadership programs.
The capital stock was acquired from Michael Rutherford, the sole employee
shareholder. Mr. Rutherford had no prior relationships with us. The purchase
price consisted of $50,000 in cash, 125,000 shares of our common stock valued at
$2.00 per share (which is approximately the average closing price of the stock
for the 20-day period ended August 14, 2000) and 10% of the total issued and
outstanding capital stock of Jamita. The acquisition has been accounted for
using the purchase method of accounting.
We funded the cash portion of the purchase price of Jamita and RLG from our
existing cash reserves.
ITEM 7 FINANCIAL STATEMENTS AND EXHIBITS
(a) and (b) Financial Statements of Business Acquired and Pro Forma
Financial Information
These financial statements and the pro forma financial information are in
process of being prepared and will be filed as an amendment to this report as
soon as practicable, but no later than October 13, 2000.
Exhibits Material Contracts
Exhibit 10.8 Agreement and Plan of Stock Purchase entered
into by and among COMPASS KNOWLEDGE HOLDINGS, INC.,
a Nevada corporation ("CKHI") and COMPASS
ACQUISITION CORP., a Florida corporation (the
"Acquisition Corp"), a wholly owned subsidiary of
CKHI (CKHI and the Acquisition Corp shall sometimes
be hereinafter collectively known as the "Buyer")
and LARRY G. ROWEDDER, NANCY ROWEDDER, TAMMY
ANDERSON, MIKE ROWEDDER, GINA ROWEDDER, JACQUELYN
ROWEDDER, LARRY G. ROWEDDER AS CUSTODIAN FOR JESSICA
ANDERSON UNDER THE OHIO TRANSFERS TO MINORS ACT and
MICHAEL RUTHERFORD (collectively the "Stockholders")
and JAMITA, INC., a Ohio corporation (hereinafter
"Company" or "Jamita").
Exhibit 10.9 Escrow Agreement entered into by and among
Compass Knowledge Holdings, Inc., a Florida
corporation (hereinafter referred to as "Buyer"),
Jamita, Inc., an Ohio corporation ("Jamita"), the
shareholders of Jamita listed on the signature page
of the Escrow Agreement (hereinafter jointly and
severally called the "Shareholder") and Firstar Bank,
Cincinnati, Ohio (the "Escrow Agent").
Exhibit 10.10 Registration Rights Agreement entered into by
and among COMPASS KNOWLEDGE HOLDINGS, INC., a Nevada
corporation (the "Company") and LARRY G. ROWEDDER,
MICHAEL RUTHERFORD, NANCY ROWEDDER, TAMMY ANDERSON,
MIKE ROWEDDER, GINA ROWEDDER, JACQUELYN ROWEDDER AND
LARRY G. ROWEDDER AS CUSTODIAN FOR JESSICA ANDERSON
UNDER THE OHIO TRANSFERS TO MINORS ACT (collectively
the "Stockholders").
Exhibit 10.11 Pledge Agreement entered into by and between
Compass Knowledge Holdings, Inc., a Nevada
corporation, (the "PLEDGOR") and Firstar Bank,
Firstar Bank, N.A. Corporate Trust Dept., 425 Walnut
Street, Cincinnati, OH 45201, Trustee ("Pledgee") for
the Shareholders listed on the signature page of the
Agreement (collectively the "Shareholder").
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Exhibit 10.12 Employment Agreement by and between Jamita,
Inc., a Ohio corporation (the "Company"), and Michael
Rutherford ("Employee").
Exhibit 10.13 Employment Agreement by and between Jamita, Inc., a
Ohio corporation (the "Company") and Larry G.
Rowedder ("Employee").
Exhibit 10.14 Mutual General Releases of Larry G. Rowedder,
Nancy Rowedder, Tammy Anderson, Mike Rowedder, Gina
Rowedder, Jacquelyn Rowedder, and Larry G. Rowedder
as Custodian for Jessica Anderson Under the Ohio
Transfers to Minors Act (collectively, the "Rowedder
Stockholders"), Michael Rutherford ("Rutherford," and
collectively with the Rowedder Stockholders, the
"Stockholders"), Jamita, Inc., an Ohio corporation
("Jamita") and Rutherford Learning Group, Inc., a
North Carolina corporation ("RLG").
Exhibit 10.15 Conditional Termination Agreement by and among
COMPASS KNOWLEDGE HOLDINGS, INC., a Nevada
corporation ("CKHI") and COMPASS ACQUISITION CORP., a
Florida corporation (the "Acquisition Corp"), a
wholly owned subsidiary of CKHI (CKHI and the
Acquisition Corp shall sometimes be hereinafter
collectively known as the "Buyer") and LARRY G.
ROWEDDER, NANCY ROWEDDER, TAMMY ANDERSON, MIKE
ROWEDDER, GINA ROWEDDER, JACQUELYN ROWEDDER, LARRY G.
ROWEDDER AS CUSTODIAN FOR JESSICA ANDERSON UNDER THE
OHIO TRANSFERS TO MINORS ACT and MICHAEL RUTHERFORD
(collectively the "Stockholders") and JAMITA, INC., a
Ohio corporation (hereinafter "Company" or "Jamita").
Exhibit 10.16 Agreement and Plan of Stock Exchange by and Among
COMPASS KNOWLEDGE HOLDINGS, INC., a Nevada
Corporation ("CKHI") and COMPASS ACQUISITION CORP., a
Florida corporation (the "Acquisition Corp"), a
wholly owned subsidiary of CKHI and MICHAEL
RUTHERFORD (the "Stockholder") and RUTHERFORD
LEARINING GROUP, INC., a North Carolina corporation.
Exhibit 10.17 Registration Rights Agreement by and among COMPASS
KNOWLEDGE HOLDINGS, INC. and MICHAEL RUTHERFORD.
Exhibit 10.18 Employment Agreement by and between RUTHERFORD
LEARINING GROUP, INC. and MICHAEL RUTHERFORD.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
COMPASS KNOWLEDGE HOLDINGS, INC.
Date: AUGUST 23, 2000 BY: /s/ ROGERS W. KIRVEN, JR.
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Chief Executive Officer and Director
Date: AUGUST 23, 2000 BY: /s/ ANTHONY RUBEN
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Chief Financial Officer and Treasurer
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