World Am Communications, Inc. Reaches Agreement to Acquire Manufacturing Plant in China
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Business Editors WESTMINSTER, Colo.--(BUSINESS WIRE)--WLDI-- World Am Communications, Inc. (OTCBB:WLDI), www.world-am.com, whose wholly owned subsidiary, Isotec, Inc., www.isotecinc.com, conceives, develops and markets state-of-the-art security systems, announced today that it has entered into an agreement to establish a wholly owned manufacturing subsidiary in Yantai, China, which will in turn acquire a manufacturing facility. The agreement calls for World Am to exchange a combination of shares of restricted common stock and convertible preferred shares, convertible to restricted common shares of World Am, in return for a manufacturing facility located in Yantai, China. The agreement specifies that the facility will also be complete with the equipment and tools necessary for manufacture of Isotec Inc. low cost portals. The agreement requires that the newly formed World Am Security Ventures Company, Ltd. ("WSVC") obtain an appraisal from an independent source that will comply with GAAP and GAAS requirements for foreign assets that will accurately and fairly state the market price valuation. The expected value is to be a minimum valuation of $4,000,000 at market price for the assets acquired. James Alexander, World Am CEO, said: "The World Am board of directors has determined that owning and controlling our foreign manufacturing facility offers many benefits over our joint venture arrangement with Comfort Virtue. The exchange of shares for a functional manufacturing facility should also add tangible asset value to the company. Also, since the transaction calls for an independent valuation and audit of the asset value we hope to be assured of a fair and accurate valuation. Although this means we will discontinue the Joint Venture with Comfort Virtue, they will remain a non-exclusive manufacturer of selected models of Isotec low cost portals. An opening ceremony is planned for late June 2004." Isotec Inc. is best known in the security industry for its "Transparent Security(TM)" systems, which it conceived and developed. Transparent Security is a registered trademark of Isotec, Inc. All other company or product names are registered trademarks or trademarks of their respective owners. Certain statements in this news release may contain forward-looking information within the meaning of Rule 175 under the Securities Act of 1933 and Rule 3b-6 under the Securities Exchange Act of 1934, and are subject to the safe harbor created by those rules. All statements, other than statements of fact, included in this release, including, without limitation, statements regarding potential future plans and objectives of the company, are forward-looking statements that involve risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Technical complications that may arise could prevent the prompt implementation of any strategically significant plan(s) outlined above. The company cautions that these forward-looking statements are further qualified by other factors including, but not limited to, those set forth in the company's Form 10-KSB filing and other filings with the United States Securities and Exchange Commission (available at www.sec.gov). The company undertakes no obligation to publicly update or revise any statements, whether as a result of new information, future events or otherwise. KEYWORD: INTERNATIONAL ASIA PACIFIC COLORADO INDUSTRY KEYWORD: MANUFACTURING HARDWARE COMPUTERS/ELECTRONICS SOURCE: World Am Communications, Inc. CONTACT INFORMATION: World Am Communications, Inc. Investor Relations, 303-452-0022 worldamir@netzero.com
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Acquisition or Disposition of Assets and Financial Statements & Exhib
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS. On May 18, 2004, the Registrant entered into a Share Exchange Agreement with World Am Security Venture Company, Ltd., a privately held China corporation ("WSVC"). Under the terms of this agreement, the Registrant is purchasing all of the outstanding stock of WSVC, consisting of one share owned by James Kang. In return, the Registrant will pay 20,000,000 shares of its restricted common stock and 100 shares of convertible preferred stock.
The preferred stock will be convertible to the number of shares of the Registrant's common stock required to equal the verified/audited amount of capital invested in WSVC by Mr. Kang, less the value on the date of conversion of the 20,000,000 shares of common stock issued at closing of this agreement. No conversion will be allowed until the earlier of six months after the date of closing or ninety days following any reverse split of the common shares of the Registrant.
The purpose of this agreement is to establish a wholly owned manufacturing subsidiary in Yantai, China, which will in turn acquire a manufacturing facility. The agreement specifies that the facility to be acquired will be complete with the equipment and tools necessary for manufacture of low cost portals designed and developed by the Registrant's subsidiary, Isotec Inc. The agreement requires that WSVC obtain an appraisal from an independent source that will comply with GAAP and GAAS requirements for foreign assets that will accurately and fairly state the market price valuation.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS. Financial Statements.
The Registrant has determined, based on Securities and Exchange Commission Rule 3-05 under Regulation S-X (regarding financial disclosure of businesses acquired or to be acquired), that no financial statements are required to be disclosed in connection with this acquisition since the Registrant is not acquiring a business at this time.
Exhibits.
Exhibits included are set forth in the Exhibit Index pursuant to Item 601 of Regulation S-B.
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