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): JULY 10, 2002
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                               ACTIVEWORLDS CORP.
                               ------------------
             (Exact name of registrant as specified in its charter)


         DELAWARE                      001-15819                 13-3883101
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(State or other jurisdiction     (Commission File No.)          (IRS Employer
 of incorporation)                                           Identification No.)


                85 MOUNTAINSIDE TRAIL, CORTLAND MANOR, N.Y. 10567
               (Address of principal executive offices) (Zip Code)

       Registrant's telephone number, including area code: (914) 737-6883
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ITEM 1.  CHANGE OF CONTROL OF REGISTRANT

ITEM 5.  OTHER EVENTS AND REGULATION FD DISCLOSURE.

         On July 10, 2002, Activeworlds Corp. (the "Company") entered into an
Agreement and Plan of Exchange, subject to the approval of a majority of the
outstanding shares of common stock of the Company, whereby the Company agreed to
sell all of the issued and outstanding common stock of its subsidiary
Activeworlds, Inc., a Nevada corporation, to J.P. McCormick ("McCormick") and
Richard F. Noll ("Noll") who then comprised the Company's management.

         As part of the transaction, the following steps will occur:

         o        Noll shall sell the Company 1,305,948 shares of common stock;

         o        McCormick shall sell the Company 1,289,497 shares of common
                  stock;

         o        The 2,595,445 shares of the Company's common stock
                  representing 30.1% of its outstanding shares will become
                  treasury shares;

         o        Messrs. McCormick and Noll immediately resigned as officers
                  and directors and terminated their employment agreements
                  effective immediately;

         o        The Company agreed to pay McCormick and Noll $210,000 and
                  $215,000, respectively, and pay up to $15,000 of their legal
                  fees. Together, McCormick and Noll were together owed
                  approximately $159,452 (not including approximately 25% in
                  benefits) under their employment agreements which they
                  terminated;

         o        As a result of their control of the Company prior to the
                  events described in this Report, Messrs. McCormick and Noll
                  were in a position to renew their employment agreements at
                  salaries of $150,000 per year (plus benefits) upon expiration
                  in January 2003;

         o        McCormick and Noll shall acquire the entire business of the
                  Company but not its existing litigation against Juno.com and
                  its remaining cash balances of approximately $630,000;

         The above transaction was approved by each of the three independent
directors with Messrs. McCormick and Noll abstaining.

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         Following the resignations of McCormick and Noll, the remaining
directors appointed Alex Adelson as interim president and secretary and Bruce
Judson as interim vice president of finance and treasurer. Messrs. Adelson and
Judson are two of the Company's three directors.

         Prior to the resignations of McCormick and Noll, the three independent
directors strongly believed Activeworlds, Inc. and its business model were not
in the best interests of the Company's stockholders as evidenced by the
Company's continuing losses. The Company is seeking to acquire an operating
business in a reverse merger transaction which has the potential to create
stockholder value.

         At the same time, McCormick and Noll entered an agreement with Michael
Gardner ("Gardner"), a 10% stockholder of the Company, subject to the closing of
the transaction described above. Gardner agreed to purchase 500,000 shares of
common stock from each of McCormick and Noll for $50,000 each. Also, effective
on July 10th, McCormick and Noll gave Gardner irrevocable proxies covering a
total of 3,795,445 shares of common stock.

         Gardner has the power to vote more than a majority of outstanding
shares and has agreed to approve the sale of Activeworlds, Inc.

         If the transactions do not close by August 15, 2002, the agreements
described above shall terminate, McCormick and Noll shall be reinstated as
directors and as officers and their employment agreements reinstated.

ITEM 7.  FINANCIAL STATEMENTS AND EXHIBITS.

Exhibit No.         Exhibit
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2.1                 Agreement and Plan of Exchange


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                                    SIGNATURE

         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.



                                                     ACTIVEWORLDS CORP.

                                                     By: /s/ Alex Adelson
                                                     ----------------------
                                                     President
Date: July 12, 2002


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