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 Earliest Event Reported: March 26, 2001
WORLDWIDE PETROMOLY, INC.
(Exact name of registrant as specified in its charter)
Colorado 000-24682 84-1125214
(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation or organization) Identification No.)
1300 Post Oak Boulevard, Suite 1985
Houston, Texas 77056
(Address of principal executive offices, including zip code)
(713) 892-5823
(Registrant's telephone number, including area code)
Item 5. Other Events.
On March 26, 2001, we entered into an Agreement and Plan of Merger (the
"Merger Agreement") with Petro Merger, Inc., a Georgia corporation, and our
wholly owned subsidiary ("Petro Merger"), Gilbert Gertner, our Chairman of the
Board, Small Town Radio, Inc., a Georgia corporation ("STR"), and certain of the
Shareholders of STR. STR is a recently formed company based in Atlanta,
Georgia, which intends to acquire, integrate and operate a number of radio
stations, primarily in smaller, non-rated markets in the Southeast. Non-rated
markets are markets in which the audience size is not measured by a national
rating service. A press release announcing the signing of the Merger Agreement
was released on March 26, 2001. A copy of the press release is attached as an
exhibit hereto.
The Merger Agreement was approved by the Board of Directors, subject to
certain conditions, including the receipt of not less than $4,000,000 in cash at
closing, which we will use after the closing to undertake our new business plan,
a fairness opinion being received by the Board of Directors as to the fairness
to our shareholders from a financial point of view, and other standard closing
conditions for an acquisition of this size and nature. If the transactions
contemplated by the Merger Agreement have not become effective and the closing
has not occurred by April 30, 2001, then the Merger Agreement and all related
ancillary agreements shall terminate. The Merger Agreement was the result of
good faith arms-length negotiations between the parties. Although the parties
intend to continue in good faith to complete the merger, certain of the
conditions are outside of the parties' control, and no assurance can be given
that all of the conditions will be met or waived and that the merger will
actually close.
The Merger Agreement contemplates the merger (the "Merger") of Petro Merger
with and into STR, a private company, pursuant to which we will issue
112,467,860 new shares of our common stock in exchange for all STR common
stock. Additionally, in conjunction with certain financing being obtained by
STR, we will issue up to 33,333,333 shares of preferred stock, convertible on a
one-to-one basis into our common stock. In association with this financing, the
placement agent will receive a warrant for 1,000,000 shares of STR common stock,
which will be issued at an anticipated per share exercise price of 100% of the
average closing price of our common stock for the thirty day period prior to the
close of the financing, and which will convert into a warrant for 1,000,000
shares of our common stock upon the closing of the Merger.
If the Merger Agreement is consummated, the holders of STR common and
preferred stock will own approximately 75% of our shares outstanding upon
completion of the Merger.
Subsequent to the completion of the Merger, we intend to undertake several
actions to position ourselves for our new business. These actions contemplate a
series of transactions, including the full settlement of approximately $1.5
million owed under an unsecured lending arrangement to Mr. Gilbert Gertner, who
is currently our Chairman of the Board of Directors and largest individual
shareholder. To achieve this settlement, we intend to transfer all of the stock
of Worldwide Petromoly Corporation ("WPC"), our operating subsidiary, along with
all of our liabilities immediately prior to the Merger (including Mr. Gertner's
indebtedness), to Mr. Gertner, and to issue to him additional shares of common
stock. In conjunction with the transfer of WPC, and for the benefit of our
shareholders, Mr. Gertner has agreed to pay us a percentage of any profits
generated by the sale of WPC's assets, in the event of a sale, or a percentage
of the net profits from its continuing business operations, should there be any,
for a period of eighteen months following the completion of the Merger. Upon
completion of the Merger and the subsequent transactions, Mr. Gertner will be
the beneficial owner of approximately 13.3% of our fully diluted shares
outstanding.
Other actions we expect to undertake include a reverse split of our capital
stock, which would reduce the aggregate number of shares outstanding. We also
anticipate changing our name to "Small Town Radio, Inc." To accomplish these
changes, we expect to call a shareholders' meeting within 45 days of completion
of the Merger.
Following the Merger, our Board of Directors will consist of five (5)
persons, including two (2) of our current directors and three (3) persons
designated by STR.
Item 7. Financial Statements and Exhibits
(a) Financial Statements:
None.
(b) Exhibits:
2.1 Agreement and Plan of Merger
99.1 Press Release
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 hereunto duly authorized.
WORLDWIDE PETROMOLY, INC.
Date: March 27, 2001 By: /s/ Lance Rosmarin
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Lance Rosmarin, President