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AGREEMENT AND PLAN OF MERGER
BY AND AMONG
ROOMLINX, INC.,
ARC COMMUNICATIONS INC.
AND
RL ACQUISITION, INC.
DATED: DECEMBER 8, 2003
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AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER (the "AGREEMENT"), dated as of
December 8, 2003, is made and entered into by and among ROOMLINX, INC., a Nevada
corporation ("ROOMLINX"), ARC COMMUNICATIONS INC., a New Jersey corporation
("ARC"), and RL ACQUISITION, INC., a Nevada corporation and wholly-owned
subsidiary of ARC ("RL").
BACKGROUND
WHEREAS, RoomLinX is engaged in the business of providing wireless
high-speed Internet network solutions to the hospitality industry, including,
without limitation, conference centers and hotels (the "BUSINESS");
WHEREAS, the parties hereto desire to effect the merger of RoomLinX
with and into RL, with RL as the surviving entity, which shall be wholly-owned
by ARC (the "INITIAL MERGER"), and, immediately thereafter, to effect the merger
of RL with and into ARC or ARC with and into RL (the "MERGER"); and
WHEREAS, the respective Boards of Directors of RoomLinX, ARC and RL
have determined that the Initial Merger and the Merger is fair to, and in the
best interests of, their respective stockholders, have approved and adopted this
Agreement and each of the Related Agreements (as hereinafter defined) to which
it is a party and each of the transactions contemplated hereby and thereby and,
in the case of ARC and RL, have resolved to declare this Agreement and the
Related Agreements advisable and to recommend to their respective stockholders
that they approve this Agreement and the Related Agreements and the transactions
contemplated hereby and thereby, including the Initial Merger and the Merger,
upon the terms and subject to the conditions more fully set forth herein.
NOW, THEREFORE, in consideration of the mutual promises and covenants
set forth herein, and intending to be legally bound hereby, the parties hereto
agree as follows:
ARTICLE 1
THE MERGER AND RELATED MATTERS
SECTION 1.1 THE MERGER. Subject to the terms and conditions of this
Agreement, Articles of Merger (each a "CERTIFICATE OF MERGER") duly executed and
acknowledged shall be filed in the offices of the Secretary of State of the
States of Nevada and New Jersey, as necessary, on the Closing Date (as defined
in Article 5) or as soon as practicable thereafter. The Initial Merger shall
become effective upon the filing of a Certificate of Merger in the State of
Nevada (the "INITIAL EFFECTIVE TIME"). At the Initial Effective Time, RoomLinX
shall be merged with and into RL, and, RL shall continue as the surviving
corporation under the laws of the State of Nevada. The Merger shall become
effective upon the filing of a Certificate of Merger in the States of Nevada and
New Jersey (the "EFFECTIVE TIME"). At the Effective Time, RL shall be merger
with and into ARC or ARC shall be merged with and into RL and, RL or ARC, as the
case may be, shall continue as the surviving corporation under the laws of the
State of Nevada, in the case of RL as the surviving corporation, or the State of
New Jersey, in the case of ARC as the surviving corporation (such continuing
corporation sometimes hereinafter referred to as the "SURVIVING CORPORATION").
For federal income tax purposes, each of the Initial Merger and the Merger is
intended to constitute a reorganization within the meaning of Section 368 of the
Internal Revenue Code of 1986, as amended. The parties to this Agreement hereby
adopt this Agreement as a "plan of reorganization" within the meaning of
Sections 1.368-2(g) and 1.368-3(a) of the United States Treasury Regulations.
SECTION 1.2 EFFECT OF MERGER.
(a) At the Initial Effective Time, the effect of the Initial
Merger shall be as provided in the applicable provisions of the laws of the
State of Nevada. Except as herein specifically set forth, the identity,
existence, purposes, powers, objects, franchises, privileges, rights and
immunities of RL shall continue unaffected and unimpaired by the Initial Merger
and the corporate franchises, existence and rights of RoomLinX shall be merged
with and into RL, and RL, as the surviving corporation, shall be fully vested
therewith. At the Effective Time, the separate existence of RoomLinX shall cease
and, in accordance with the terms of this Agreement, RL shall possess all the
rights, privileges, immunities and franchises, of a public, as well as of a
private, nature, and all property, real, personal and mixed, and all debts due
on whatever account, and all taxes, including those due and owing and those
accrued, and all other choses in action, and all and every other interest of or
belonging to or due to RoomLinX and RL shall be taken and deemed to be
transferred to, and vested in, RL without further act or deed; and all property,
rights, privileges, powers and franchises and all and every other interest shall
be thereafter effectually the property of RL as they were of RoomLinX and RL.
Except as otherwise provided herein, RL shall thenceforth be responsible and
liable for all the liabilities and obligations of RoomLinX and RL and any claim
existing, or action or proceeding pending, by or against RoomLinX or RL may be
prosecuted as if the Initial Merger had not taken place, and RL may be
substituted in their place. Except as set forth herein, neither the rights of
creditors nor any liens upon the property of RoomLinX or RL shall be impaired by
the Initial Merger, and all debts, liabilities and duties of RoomLinX and RL
shall attach to RL, and may be enforced against RL to the same extent as if said
debts, liabilities and duties had been incurred or contracted by RL.
(b) At the Effective Time, the effect of the Merger shall be
as provided in the applicable provisions of the laws of the States of Nevada and
New Jersey, as applicable. Except as herein specifically set forth, the
identity, existence, purposes, powers, objects, franchises, privileges, rights
and immunities of ARC or RL, as the case may be, shall continue unaffected and
unimpaired by the Merger and the corporate franchises, existence and rights of
ARC or RL, as the case may be, shall be merged with and into the Surviving
Corporation and the Surviving Corporation shall be fully vested therewith. At
the Effective Time, the separate existence of ARC or RL, as the case may be,
shall cease and, in accordance with the terms of this Agreement, the Surviving
Corporation shall possess all the rights, privileges, immunities and franchises,
of a public, as well as of a private, nature, and all property, real, personal
and mixed, and all debts due on whatever account, and all taxes, including those
due and owing and those accrued, and all other choses in action, and all and
every other interest of or belonging to or due to ARC or RL shall be taken and
deemed to be transferred to, and vested in, the Surviving Corporation without
further act or deed; and all property, rights, privileges, powers and franchises
and all and every other interest shall be thereafter effectually the property of
the Surviving Corporation as they were of ARC and RL. Except as otherwise
provided herein, the Surviving Corporation shall thenceforth be responsible and
liable for all the liabilities and obligations of ARC and RL and any claim
existing, or action or proceeding pending, by or against ARC or RL may be
prosecuted as if the Merger had not taken place, and the Surviving Corporation
may be substituted in their place. Except as set forth herein, neither the
rights of creditors nor any liens upon the property of ARC or RL shall be
impaired by the Merger, and all debts, liabilities and duties of ARC and RL
shall attach to the Surviving Corporation, and may be enforced against the
Surviving Corporation to the same extent as if said debts, liabilities and
duties had been incurred or contracted by the Surviving Corporation.
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SECTION 1.3 ARTICLES OF INCORPORATION OF THE SURVIVING CORPORATION. The
articles of incorporation of ARC, as amended immediately prior to the Closing,
shall be the articles of incorporation of the Surviving Corporation.
SECTION 1.4 BY-LAWS OF THE SURVIVING CORPORATION. The bylaws of ARC, as
in effect immediately prior to the Closing, shall be the bylaws of the Surviving
Corporation until thereafter amended as provided by law.
SECTION 1.5 DIRECTORS AND OFFICERS OF SURVIVING CORPORATION. At the
Effective Time, each of the directors and officers of RL and ARC immediately
prior to the Effective Time shall resign or be removed from office and
concurrently therewith the directors of the Surviving Corporation shall be
comprised of two directors designated by RoomLinX (the "ROOMLINX DESIGNEES"),
one director designated by ARC (the "ARC DESIGNEE") and two directors designated
by the RoomLinX Designees and the ARC Designee, such directors to hold office,
subject to the applicable provisions of the articles of incorporation and bylaws
of the Surviving Corporation, until the next annual stockholders' meeting of the
Surviving Corporation and until their respective successors shall be duly
elected or appointed and qualified. Within twelve (12) months of the execution
of this Agreement, ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇ or his designee and ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇ or his
designee shall have the right to mutually designate the Chief Executive Officer
of the Surviving Corporation. At the Effective Time, the other officers of the
Surviving Corporation, subject to the applicable provisions of the articles of
incorporation and bylaws of the Surviving Corporation, shall be as designated by
the Board of Directors of the Surviving Corporation until their respective
successors shall be duly elected or appointed and qualified.
SECTION 1.6 MANNER OF CONVERSION. As of the Effective Time:
(a) all of the shares of common stock, par value $.001 per share, of
RoomLinX which are issued and outstanding immediately prior to the Initial
Effective Time (the "ROOMLINX SHARES"), by virtue of the Initial Merger and the
Merger and without any action on the part of the holder thereof, automatically
shall be deemed to represent the right to receive the merger consideration, as
provided in Section 1.7 hereof, and all of the outstanding options, convertible
debentures and warrants of RoomLinX shall be canceled, extinguished or converted
into the right to receive ARC Common Stock as provided in Section 1.7, other
than up to $30,000 of convertible debentures of RoomLinX (the "PERMITTED DEBT")
which shall be converted into indebtedness of ARC, the principal amount of which
shall be convertible into shares of common stock, par value $.001 per share, of
ARC (the "ARC COMMON STOCK") at a conversion price of $.20 per share, with such
indebtedness having a maturity date of not less than eighteen (18) months from
the Closing Date;
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(b) all RoomLinX Shares which are held by RoomLinX as treasury stock
shall be canceled and retired and no consideration shall be delivered or paid in
exchange therefore; and
(c) each share of the capital stock of RL shall be canceled and in
exchange therefore, one (1) share of RoomLinX shall be issued to ARC, which
share of RoomLinX shall constitute all of the issued and outstanding shares of
capital stock of RoomLinX.
SECTION 1.7 MERGER CONSIDERATION. At the Effective Time, RoomLinX
Shares, other than RoomLinX Shares held in treasury (which shall be canceled
pursuant to Section 1.6(b) above), by virtue of the Merger and without any
action on the part of the holders thereof (the "ROOMLINX STOCKHOLDERS"),
automatically shall be canceled and extinguished and converted into the right to
receive (a) three (3) shares of ARC Common Stock for each one (1) share of ARC
Common Stock outstanding at the Effective Time (the "ARC MERGER SHARES";
provided that 10,000,000 ARC Merger Shares shall immediately be deposited in
escrow for a period of six (6) months from the Closing Date to secure the
indemnification obligations of RoomLinX set forth herein, in accordance with the
terms of an escrow agreement to be executed by the parties on the Closing Date
(the "ESCROW AGREEMENT"), and (b) options and/or warrants to purchase the
greater of (A) 8,000,000 shares of ARC Common Stock or (B) three (3) shares of
ARC Common Stock for each (1) option or warrant outstanding to purchase ARC
Common Stock at the Effective Time provided that such options and/or warrants
shall have an exercise price of not less than $.20 per share, shall not be
entitled to "cashless" exercise provisions and shall be exercised within two (2)
years of the Closing Date. At the Effective Time, the RoomLinX Stockholders
shall deliver stock certificates representing all of the issued and outstanding
RoomLinX Shares to ARC and ARC shall (x) issue to the RoomLinX Stockholders in
exchange therefor stock certificates representing the ARC Merger Shares,
10,000,000 of which shall be delivered to the escrow agent in accordance with
the Escrow Agreement, and (y) authorize the issuance of the options and/or
warrants referred to above. In determining the number of shares of ARC Common
Stock or the number of options or warrants to purchase ARC Common Stock to be
issued pursuant to this Section 1.7, the shares of ARC Common Stock and options
to purchase shares of ARC Common Stock to be issued to Alliance Advisors, Roccus
Capital Partners, ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇, or their designees,
as provided in Section 6(n) hereof, shall not be deemed to be outstanding on the
Effective Date.
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SECTION 1.8 ADJUSTMENTS TO MERGER CONSIDERATION.
(a) If, prior to the Effective Time, the outstanding shares of
ARC Common Stock shall be changed into a greater number of shares or a different
class of stock by reason of any reclassification, recapitalization, exchange of
shares, stock split, or otherwise, the number of ARC Merger Shares to be
received by the RoomLinX Stockholders hereunder shall be likewise adjusted to
reflect the changed number or classification of ARC Merger Shares.
(b) If, prior to the Effective Time, ARC raises greater than
$500,000 in a private placement of ARC securities, the parties agree that the
merger consideration shall be adjusted to reflect the additional issued and
outstanding ARC securities.
(c) If, prior to the Effective Time, RoomLinX raises in excess
of $400,000 in a private placement of RoomLinX securities, the parties agree
that the merger consideration shall be adjusted to reflect the additional number
of issued and outstanding RoomLinX securities.
SECTION 1.9 RESTRICTIONS ON TRANSFERS. RoomLinX acknowledges that: (a)
the ARC Merger Shares to be issued to the RoomLinX Stockholders hereunder are
unregistered and may be required to be held indefinitely unless they are
subsequently registered under the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereto (the "SECURITIES ACT"), or an
exemption from such registration is available; (b) the ARC Merger Shares may not
be offered, sold, pledged, hypothecated or otherwise disposed of unless such
offer, sale pledge, hypothecation or other disposition (i) is registered under
the Securities Act, or (ii) does not violate the Securities Act, and (c) the
certificates representing the ARC Merger Shares shall bear a legend to the
effect of (a) and (b) above.
SECTION 1.10 APPRAISAL RIGHTS. Notwithstanding any provision of this
Agreement to the contrary, the RoomLinX Shares (the "DISSENTING SHARES") that
are issued and outstanding immediately prior to the Effective Time and held by
stockholders who did not vote in favor of the Merger and who comply with all of
the relevant provisions of Sections 92A.300 to 92A.500 of Nevada Law (the
"DISSENTING STOCKHOLDERS") will not be converted into or be exchangeable for the
right to receive ARC Merger Shares, unless and until such holders have failed to
perfect or have effectively withdrawn or lost their rights to appraisal under
Nevada Law. RoomLinX will give ARC (i) immediate oral notice followed by prompt
written notice of any written demands for appraisal of any RoomLinX Shares,
attempted withdrawals of any such demands and any other instruments served
pursuant to Nevada Law and received by RoomLinX relating to stockholders' rights
of appraisal, and (ii) will keep ARC informed of the status of all negotiations
and proceedings with respect to demands for appraisal under Nevada Law. If any
Dissenting Stockholder fails to perfect or will have effectively withdrawn or
lost the right to appraisal, the RoomLinX Shares held by such Dissenting
Stockholder will thereupon be treated as though such shares had been converted
into the right to receive ARC Merger Shares pursuant to Section 1.7 of this
Agreement.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF ROOMLINX
RoomLinX represents and warrants to RL and ARC that:
SECTION 2.1 ORGANIZATION. RoomLinX is a corporation duly organized,
validly existing and in good standing under the laws of the State of Nevada with
all requisite legal right, power and authority (corporate or other) to own or
hold under lease the property it purports to own or hold under lease and to
carry on the Business. RoomLinX is duly qualified to transact business and is in
good standing in each jurisdiction in which the conduct of the Business or its
ownership or leasing of property requires such qualification.
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SECTION 2.2 SUBSIDIARIES. RoomLinX has no subsidiaries and RoomLinX
does not own of record or beneficially, directly or indirectly, (i) any share of
capital stock or securities convertible into capital stock of any other
corporation, (ii) any participating interest or equity interest in any
partnership, joint venture, limited liability company or other non-corporate
business enterprise, or (iii) control, directly or indirectly, any other entity.
SECTION 2.3 PENDING CLAIMS.
(a) There is no litigation, suit, action, claim, arbitration, administrative or
legal or other proceeding, or governmental investigation pending or, to
RoomLinX's knowledge threatened, against RoomLinX and there are no unasserted
claims possible of assertion of which RoomLinX has notice or knowledge;
(b) There are no audits by a governmental authority, claims for unpaid taxes of
any kind, or other similar actions, proceedings or disputes pending or, to
RoomLinX's knowledge, threatened against or affecting RoomLinX or the Business;
(c) There are no unpaid judgments of any kind against RoomLinX relating to
RoomLinX or the Business; and
(d) RoomLinX has not been charged with or, to its knowledge threatened, with a
charge or violation or, to its knowledge, is it under investigation with respect
to any alleged violation of any provision of any federal, state, local or
foreign law or administrative ruling or regulation relating to RoomLinX or any
aspect of the Business.
SECTION 2.4 TITLE TO ASSETS. RoomLinX is the sole and exclusive owner
of, and has good and marketable title to, all of its assets, rights, properties,
claims, contracts and businesses of every kind, nature, character and
description, tangible and intangible, personal, real or mixed, wherever located
(collectively, "ASSETS"), free and clear of all liens, mortgages, pledges,
claims, encumbrances, security interests, covenants, easements, rights of way,
equities, options, rights of first refusal, assessments, defects in title,
encroachments, charges or any other burden or restriction of any kind or nature
(collectively, "LIENS"); and no other person, firm or corporation has or will
have on the Closing Date (as hereinafter defined) any interest whatsoever in any
of its Assets.
SECTION 2.5 AUTHORITY AND ENFORCEABILITY. Except for the approval of
the RoomLinX Stockholders, which shall be sought promptly after execution and
delivery of this Agreement, RoomLinX has the full right, power, legal capacity
and authority to enter into and perform its obligations under this Agreement and
each of the other agreements to be entered into in connection with the
transactions contemplated herein (the "RELATED Agreements"). The execution,
delivery and performance by RoomLinX of this Agreement, the Related Agreements
and any other agreements contemplated hereby and thereby and the consummation of
the transactions contemplated hereby and thereby have been duly authorized by
the Board of Directors of RoomLinX. No other corporate or stockholder action is
necessary for the authorization, execution, delivery and performance by RoomLinX
of this Agreement, the Related Agreements and any other agreements between the
parties contemplated hereby and the consummation by RoomLinX of the transactions
contemplated hereby or thereby, including the Merger. This Agreement and each
Related Agreement have been duly executed and delivered by RoomLinX and
constitute the legal, valid and binding obligations of RoomLinX, enforceable
against it in accordance with its terms.
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SECTION 2.6 NO BREACH OR VIOLATION. The execution, delivery and
performance of this Agreement, the Related Agreements and any other agreements
contemplated hereby and thereby between the parties hereto by RoomLinX and the
consummation of the transactions contemplated hereby and thereby will not (a)
result in or constitute a breach or an event that, with or without notice or the
passing of time or both, would be a default, breach or other violation of the
articles of incorporation or bylaws of RoomLinX; (b) violate (with or without
the giving of notice or the passing of time or both), or require any consent,
approval, filing or notice under, any provision of any law, rule or regulation,
court or administrative order, writ, judgment or decree applicable to RoomLinX,
the Business or any of its Assets; and (c) with or without the giving of notice
or the passing of time or both (i) violate or conflict with, or result in the
breach, suspension or termination of any provision of, or constitute a default
under, or result in the acceleration of the performance of the obligations of
RoomLinX under, or (ii) result in the creation of any Liens upon all or any
portion of the properties or the Assets of RoomLinX or the Business pursuant to,
the articles of incorporation or bylaws of RoomLinX, or any indenture, mortgage,
deed of trust, lease, agreement, contract or instrument to which RoomLinX is a
party or by which RoomLinX, its Assets or the Business is bound.
SECTION 2.7 CORPORATE DOCUMENTS. RoomLinX has furnished to ARC for its
examination true and correct copies of the articles of incorporation, bylaws and
minute books of RoomLinX.
SECTION 2.8 CAPITALIZATION. As of the date hereof, the authorized
capital stock of RoomLinX consists of 200,000,000 shares of common stock, par
value $.001 per share, of which 14,426,963 shares are validly issued and
outstanding, fully paid and non-assessable. Except as set forth on Schedule 2.8,
RoomLinX has no options, warrants, equity securities, calls, rights (including
preemptive rights), commitments or agreements of any character to which it is a
party or by which it is bound, obligating it to issue, deliver or sell, or cause
to be issued, delivered or sold, or to repurchase, redeem or otherwise acquire,
or to cause the repurchase, redemption or acquisition, of any shares of capital
stock of RoomLinX or obligating it to grant, extend, accelerate the vesting of
or enter into any such option, warrant, equity security, call, right, commitment
or agreement, or any other obligation to make any other distribution in respect
thereof. All of the outstanding securities of RoomLinX were issued in compliance
with all applicable Federal and state securities laws. There are no voting
trusts or agreements, shareholder agreements, buy-sell agreements, rights of
first refusal, preemptive rights or proxies relating to any securities of
RoomLinX (whether or not RoomLinX is a party thereto). RoomLinX does not hold
any shares of capital stock in its treasury.
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SECTION 2.9 CONDUCT OF BUSINESS. From the date of this Agreement until
the Closing, RoomLinX shall operate the Business in the ordinary course and in a
commercially reasonable manner and will make all reasonably necessary efforts to
preserve intact the Business, its relationships with third parties, the goodwill
it has accrued and the services of its existing officers, employees, and
directors.
SECTION 2.10 FINANCIAL STATEMENTS. RoomLinX has previously furnished to
ARC the following financial statements of RoomLinX, copies of which are attached
on Schedule 2.10: (a) audited financial statements consisting of balance sheets,
statements of income, statements of retained earnings and statements of cash
flows for each of the two most recently completed fiscal years (the "AUDITED
ROOMLINX FINANCIALS") and (b) unaudited financial statements consisting of a
balance sheet (the "INTERIM ROOMLINX BALANCE SHEET") and income statement as of
and for the nine (9) months ended September 30, 2003 (the "UNAUDITED ROOMLINX
FINANCIALS" and together with the Audited RoomLinX Financials, the "ROOMLINX
FINANCIAL STATEMENTS"). All RoomLinX Financial Statements (a) have been prepared
from the books and records of RoomLinX and its subsidiaries, if any, (b) have
been prepared in accordance with GAAP, consistently applied, throughout the
periods involved (except as disclosed therein and other adjustments disclosed
therein, and, in the case of the Unaudited RoomLinX Financials, the absence of
footnotes and subject to normal year-end adjustments which will not be material)
and (c) present fairly in all material respects the financial condition of
RoomLinX as of such date and the results of its operations for the calendar year
or nine-month period then ended.
SECTION 2.11 NO UNDISCLOSED LIABILITIES. Except as specifically
described in the RoomLinX Financial Statements or as set forth on Schedule 2.11,
RoomLinx has no liabilities or obligations of any nature (whether known or
unknown and whether absolute, accrued, contingent, or otherwise) except for
liabilities or obligations reflected or reserved against in the RoomLinX
Financial Statements. RoomLinX does not know of any material liability of any
nature, direct or indirect, contingent or otherwise, or in any amount, not
adequately reflected or reserved against in the Interim RoomLinX Balance Sheet.
SECTION 2.12 TRANSACTIONS WITH AFFILIATES. Except as set forth on
Schedule 2.12, no current holder of ten (10%) percent or more of any class of
capital stock of RoomLinX nor any director, officer or employee of RoomLinX, or
member of the family of any such person, or any corporation, partnership, trust
or other entity in which any such person, or any member of the family of any
such person, has an interest or is an officer, director, trustee, partner or
holder of any equity interest (each, an "AFFILIATE"), is a party to any
transaction with RoomLinX, including any contract, agreement or other
arrangement providing for the employment of, furnishing of services by, loaning
of money to, rental of real or personal property from or otherwise requiring
payments to any such person or firm. None of the officers, directors or key
employees of RoomLinX or their Affiliates owns, directly or indirectly,
individually or collectively, a material interest in any entity which is a
competitor, customer or supplier of RoomLinX.
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SECTION 2.13 SECURITIES AND EXCHANGE COMMISSION FILINGS. The RoomLinX
Financial Statements and other information relating to RoomLinX furnished in
writing by RoomLinX to ARC for inclusion in the Proxy Statement or Information
Statement (each as hereinafter defined) at the time of the mailing of the Proxy
Statement or Information Statement to ARC's stockholders will not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary in order to make the statements contained
therein, in light of the circumstances under which they are made, not
misleading.
SECTION 2.14 NO MATERIAL MISSTATEMENT OR OMISSION OF MATERIAL FACT.
This Agreement (including the Schedules and Exhibits to this Agreement), the
Related Agreements and all other certificates, instruments and documents
executed in connection herewith and therewith are true, complete and correct in
all material respects. Neither this Agreement nor any Schedule or Exhibit to
this Agreement contains any untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make the
statements contained therein, in the light of the circumstances under which they
are made, not misleading.
SECTION 2.15 NO MATERIAL ADVERSE CHANGE. Since September 30, 2003,
there has not occurred any material adverse change, event or effect in the
financial condition, results of operation, assets (including, without
limitation, intangible assets), liabilities or business of RoomLinX and its
subsidiaries, if any, taken as a whole, or any change that would prevent or
materially delay consummation of the transactions contemplated under this
Agreement, including, the Merger, or otherwise prevent RoomLinX from performing
its obligations under this Agreement and the Related Agreements ("ROOMLINX
MATERIAL ADVERSE CHANGE").
ARTICLE 3
ARC'S AND RL'S REPRESENTATIONS AND WARRANTIES
ARC and RL each represent and warrant to RoomLinX that:
SECTION 3.1 ORGANIZATION. ARC is a corporation duly organized, existing
and in good standing under the laws of the State of New Jersey, with all
requisite legal right, power and authority (corporate or other) to own or hold
under lease the property it purports to own or hold under lease and to carry on
its business. ARC is duly qualified to transact business and is in good standing
in each jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification. RL is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Nevada.
SECTION 3.2 SUBSIDIARIES. Other than RL, ARC has no subsidiaries and
ARC does not own of record or beneficially, directly or indirectly, (i) any
share of capital stock or securities convertible into capital stock of any other
corporation, (ii) any participating interest or equity interest in any
partnership, joint venture, limited liability company or other non-corporate
business enterprise, or (iii) control, directly or indirectly, any other entity.
RL has no subsidiaries and RL does not own of record or beneficially, directly
or indirectly, (i) any share of capital stock or securities convertible into
capital stock of any other corporation, (ii) any participating interest or
equity interest in any partnership, joint venture, limited liability company or
other non-corporate business enterprise, or (iii) control, directly or
indirectly, any other entity.
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SECTION 3.3 PENDING CLAIMS.
(a) There is no litigation, suit, action, claim, arbitration,
administrative or legal or other proceeding, or governmental investigation
pending or, to ARC's or RL's knowledge threatened, against ARC or RL,
respectively, and there are no unasserted claims possible of assertion of which
ARC or RL has notice or knowledge;
(b) There are no audits by a governmental authority, claims for unpaid
taxes of any kind, or other similar actions, proceedings or disputes pending or,
to ARC's or RL's knowledge, threatened against or affecting either of them or
their respective businesses;
(c) There are no unpaid judgments of any kind against ARC or RL
relating to either of them or their respective businesses; and
(d) Neither ARC nor RL has been charged with or, to the knowledge of
either of them threatened, with a charge or violation or, to the knowledge of
either of them, is either under investigation with respect to any alleged
violation of any provision of any federal, state, local or foreign law or
administrative ruling or regulation relating to any aspect of either of them or
their respective businesses.
SECTION 3.4 TITLE TO ASSETS. Each of ARC and RL is the sole and
exclusive owner of, and has good and marketable title to, all of its respective
Assets, free and clear of all Liens; and no other person, firm or corporation
has or will have on the Closing Date any interest whatsoever in any of such
Assets.
SECTION 3.5 AUTHORIZATION AND ENFORCEABILITY. Except for the approval
of the stockholders of ARC, which shall be sought promptly after the execution
and delivery of this Agreement, each of ARC and RL has the full right, power,
legal capacity and authority to enter into and perform its obligations under
this Agreement and the Related Agreements, and no other corporate or stockholder
action is necessary for the authorization, execution, delivery and performance
by each of ARC and RL of this Agreement, the Related Agreements and any other
agreements between the parties contemplated hereby and the consummation by each
of ARC and RL of the transactions contemplated hereby or thereby, including the
Merger. The execution, delivery and performance by each of ARC and RL of this
Agreement, the Related Agreements and any other agreements contemplated hereby
and thereby and the consummation of the transactions contemplated hereby and
thereby have been duly authorized by the Board of Directors of each of ARC and
RL, and ARC as the sole stockholder of RL. This Agreement and each Related
Agreement have been duly executed and delivered by each of ARC and RL and
constitute the legal, valid and binding obligations of each of ARC and RL,
enforceable against each of ARC and RL in accordance with its respective terms.
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SECTION 3.6 NO BREACH OR VIOLATION. The execution, delivery and
performance of this Agreement, the Related Agreements and any other agreements
contemplated hereby and thereby between the parties hereto by each of ARC and RL
and the consummation of the transactions contemplated hereby and thereby will
not (a) result in or constitute a breach or an event that, with or without
notice or the passing of time or both, would be a default, breach or other
violation of the articles of incorporation or bylaws of ARC or RL; (b) violate
(with or without the giving of notice or the passing of time or both), or
require any consent, approval, filing or notice under, any provision of any law,
rule or regulation, court or administrative order, writ, judgment or decree
applicable to ARC or RL, their respective businesses or their respective Assets;
and (c) with or without the giving of notice or the passing of time or both (i)
violate or conflict with, or result in the breach, suspension or termination of
any provision of, or constitute a default under, or result in the acceleration
of the performance of the obligations of ARC or RL under, or (ii) result in the
creation of any Liens upon all or any portion of the properties or Assets of ARC
or RL or their respective businesses pursuant to, the articles of incorporation
or bylaws of ARC or RL, or any indenture, mortgage, deed of trust, lease,
agreement, contract or instrument to which ARC or RL is a party or by which ARC
or RL, their respective Assets or their respective businesses is bound.
SECTION 3.7 CORPORATE DOCUMENTS. ARC and RL have furnished to RoomLinX
for its examination true and correct copies of their articles of incorporation,
bylaws and minute books.
SECTION 3.8 SEC FILINGS. Each of the documents filed by ARC with the
Securities and Exchange Commission ("SEC") (including all financial statements
included therein) (the "SEC FILINGS") at the time of filing thereof conformed
with the requirements of the Securities Act, and none of the SEC Filings at the
time of filing thereof contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary to
make the statements contained therein, in light of the circumstances under which
they were made, not misleading.
SECTION 3.9 CAPITALIZATION.
(a) As of the date hereof, the authorized capital stock of ARC consists
of 5,000,000 shares of preferred stock, par value $.20 per share, of which
720,000 shares are validly issued and outstanding, fully paid and
non-assessable, and 45,000,000 shares of ARC Common Stock, of which 14,984,459
shares were validly issued and outstanding, fully paid and non-assessable on
November 12, 2003. Except as set forth in the SEC Filings, ARC has no options,
warrants, equity securities, calls, rights (including preemptive rights),
commitments or agreements of any character to which ARC is a party or by which
it is bound, obligating it to issue, deliver or sell, or cause to be issued,
delivered or sold, or to repurchase, redeem or otherwise acquire, or to cause
the repurchase, redemption or acquisition, of any shares of capital stock of ARC
or obligating it to grant, extend, accelerate the vesting of or enter into any
such option, warrant, equity security, call, right, commitment or agreement, or
any other obligation to make any other distribution in respect thereof. All of
the outstanding securities of ARC were issued in compliance with all applicable
Federal and state securities laws. There are no voting trusts or agreements,
shareholder agreements, buy-sell agreements, rights of first refusal, preemptive
rights or proxies relating to any securities of ARC (whether or not ARC is a
party thereto). The ARC Merger Shares, when issued and delivered to the RoomLinX
Stockholders in accordance with the terms of this Agreement, will be duly and
validly issued, fully paid and non-assessable, and issued in compliance with all
applicable Federal and state securities laws, including compliance with
Regulation S promulgated under the Securities Act with respect to the non-U.S.
RoomLinX Stockholders.
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(b) As of the date hereof, the authorized capital stock of RL consists
of 100 shares of common stock, par value $.01 per share, of which 100 shares are
validly issued and outstanding, fully paid and non-assessable, all of which are
owned by ARC.
SECTION 3.10 CONDUCT OF BUSINESS. Except as expressly contemplated by
this Agreement, from the date of this Agreement until the Closing, ARC shall
operate its business in the ordinary course and in a commercially reasonable
manner and will make all reasonably necessary efforts to preserve intact its
business and its relationships with third parties, the goodwill it has accrued
and the services of its existing officers, employees and directors.
Notwithstanding the foregoing, the parties acknowledge that it is the intention
of ARC to transfer the existing ARC business model and any and all Assets of
ARC, including any intangible assets associated with the existing ARC business
model, either by a sale of stock or sale of assets, in accordance with a
transaction approved by the ARC Board of Directors (the "ARC SALE").
SECTION 3.11 FINANCIAL STATEMENTS. ARC has previously filed with the
SEC: (a) audited financial statements consisting of balance sheets, statements
of income, statements of retained earnings and statements of cash flows for each
of the two most recently completed fiscal years (the "AUDITED ARC FINANCIALS")
and (b) unaudited financial statements consisting of a balance sheet (the
"INTERIM ARC BALANCE SHEET") and income statement as of and for the nine (9)
months ended September 30, 2003 (the "UNAUDITED ARC FINANCIALS" and together
with the Audited ARC Financials, the "ARC FINANCIAL STATEMENTS"). All ARC
Financial Statements (a) have been prepared from the books and records of ARC
(b) have been prepared in accordance with GAAP, consistently applied, throughout
the periods involved (except as disclosed therein and other adjustments
disclosed therein, and, in the case of the Unaudited ARC Financials, the absence
of footnotes and subject to normal year-end adjustments which will not be
material) and (c) present fairly in all material respects the financial
condition of ARC as of such date and the results of its operations for the
calendar year or nine-month period then ended.
SECTION 3.12 NO UNDISCLOSED LIABILITIES. Except as specifically
described in the ARC Financial Statements or as set forth on Schedule 3.11, each
of ARC and RL has no liabilities or obligations of any nature (whether known or
unknown and whether absolute, accrued, contingent, or otherwise) except for
liabilities or obligations reflected or reserved against in the ARC Financial
Statements. Neither ARC nor RL knows of any material liability of any nature,
direct or indirect, contingent or otherwise, or in any amount, not adequately
reflected or reserved against in the Interim ARC Balance Sheet.
SECTION 3.13 TRANSACTIONS WITH AFFILIATES. Except as set forth in the
SEC Filings, no Affiliate of ARC or RL, is a party to any transaction with ARC
or RL, including any contract, agreement or other arrangement providing for the
employment of, furnishing of services by, loaning of money to, rental of real or
personal property from or otherwise requiring payments to any such person or
firm. None of the officers, directors or key employees of ARC or RL or their
Affiliates owns, directly or indirectly, individually or collectively, a
material interest in any entity which is a competitor, customer or supplier of
ARC or RL.
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SECTION 3.14 SECURITIES AND EXCHANGE COMMISSION FILINGS. The ARC
Financial Statements and other information relating to ARC and RL in the Proxy
Statement or Information Statement (other than the RoomLinX Financial Statements
and other information related to RoomLinX furnished to ARC for inclusion
therein) at the time of the mailing of the Proxy Statement or Information
Statement to ARC's stockholders will not contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary in order to make the statements contained therein, in light of the
circumstances under which they are made, not misleading.
SECTION 3.15 NO MATERIAL MISSTATEMENT OR OMISSION OF MATERIAL FACT.
This Agreement (including the Schedules and Exhibits to this Agreement), the
Related Agreements and all other certificates, instruments and documents
executed in connection herewith and therewith are true, complete and correct in
all material respects. Neither this Agreement nor any Schedule or Exhibit to
this Agreement contains any untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make the
statements contained therein, in the light of the circumstances under which they
are made, not misleading.
SECTION 3.16 NO MATERIAL ADVERSE CHANGE. Since September 30, 2003,
there has not occurred any material adverse change, event or effect in the
financial condition, results of operation, assets (including, without
limitation, intangible assets), liabilities or business of ARC or RL, taken as a
whole, or any change that would prevent or materially delay consummation of the
transactions contemplated under this Agreement, including, the Merger, or
otherwise prevent ARC or RL from performing its obligations under this Agreement
and the Related Agreements ("ARC-RL MATERIAL ADVERSE CHANGE")
ARTICLE 4
CONDUCT AND TRANSACTIONS PRIOR TO EFFECTIVE TIME
(a) As soon as practicable after the execution and delivery of
this Agreement, ARC and RoomLinX, in conjunction with their respective counsel,
shall prepare and file with the SEC, either (i) a Proxy Statement pursuant to
Regulation 14A ("PROXY STATEMENT") under the Securities Exchange Act of 1934, as
amended (the "EXCHANGE ACT"), or (ii) in the event that ARC obtains the
requisite approval from its stockholders without the necessity of a special
meeting of stockholders, an Information Statement pursuant to Regulation 14C
("INFORMATION STATEMENT") under the Exchange Act, and shall use their
commercially reasonable best efforts to cause the Proxy Statement to be
"cleared" by the SEC, and to cause the Proxy Statement or the Information
Statement to be mailed to all holders of ARC Common Stock.
(b) RoomLinX shall (i) cooperate in the preparation and filing
of the Proxy Statement, Information Statement or other filing required to be
made with the SEC under the Securities Act or the Exchange Act in connection
with the transactions contemplated in this Agreement and the Related Agreements,
including the Merger, and (ii) provide all material reasonably requested by ARC
(including all financial statements of RoomLinX, financial information and other
information) for inclusion in the Proxy Statement, Information Statement or
other required SEC filing.
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(c) During the period from the date of this Agreement and
continuing until the earlier of the termination of this Agreement or the
Effective Time, except as expressly contemplated by this Agreement, each of
RoomLinX and ARC shall carry on its business in the usual, regular and ordinary
course and use all commercially reasonable efforts to preserve intact its
present business organization and preserve its relationships with third parties
and others having business dealings with it, with the objective that its
goodwill and ongoing business shall be unimpaired at the Effective Time. ARC
shall continue to make all required filings in accordance with the Securities
Act and the Exchange Act. Each party shall promptly notify the other parties of
any event or occurrence not in the ordinary course of business which comes to
its attention and which has caused, or could reasonably be expected to cause, an
ARC-RL Material Adverse Change or a RoomLinX Material Adverse Change.
(d) Except as expressly contemplated by this Agreement, each
of ARC and RL shall not, without the prior written consent of RoomLinX, and
RoomLinX shall not, without the prior written consent of ARC:
(i) Intentionally omitted;
(ii) Issue, deliver or sell, authorize or propose the issuance, delivery or sale
of, or purchase or propose the purchase of, any shares of its capital stock or
securities convertible into, or subscriptions, rights, warrants or options to
acquire, or other agreements or commitments of any character obligating it to
issue any such shares or other convertible securities or authorize or propose
any change in its equity capitalization;
(iii) Solicit approval for or effect any amendments to its articles of
incorporation or bylaws;
(iv) Acquire or agree to acquire by merging or consolidating with, or by
purchasing a substantial portion of the assets of, or by any other manner, any
business or any corporation, partnership, association or other business
organization or division thereof, or otherwise acquire or agree to acquire any
assets which are material, individually or in the aggregate, to such party;
(v) Sell, lease, license, pledge or otherwise dispose of or encumber any of its
properties or assets except in the ordinary course of business consistent with
past practice (including without limitation any indebtedness owed to it or any
claims held by it);
(vi) Incur any indebtedness for borrowed money or guarantee any such
indebtedness or issue or sell any debt securities or guarantee, endorse or
otherwise become responsible for the obligations of others, or make loans or
advances, other than in the ordinary course of business consistent with past
practice;
(vii) Pay, discharge or satisfy any claim, liability or obligation (absolute,
accrued, asserted or unasserted, contingent or otherwise), other than the
payment, discharge or satisfaction in the ordinary course of business consistent
with past practice of liabilities reflected or reserved against in its financial
statements;
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(viii) Enter into or amend any employment, severance, termination contract or
other agreement or arrangement with, or pay any bonus or remuneration, including
without limitation, any severance or termination pay to, any director, employee
or consultant, or increase the salaries, wage rates, or other payments or
benefits of its directors, officers, employees, or consultants;
(ix) Transfer, assign or otherwise grant or convey to any person or entity any
rights in, to or under its intellectual property;
(x) Engage in any activities or transactions that are outside the ordinary
course of its business; or
(xi) Take, or agree (in writing or otherwise) to take, any of the actions
described in this Section, or any action which would make any of the
representations or warranties contained in this Agreement untrue or inaccurate
or result in any of the conditions to the Merger set forth herein not being
satisfied.
(e) Each party shall give each other party, and its
accountants, counsel and other representatives, reasonable access during normal
business hours and upon reasonable prior notice during the period from the date
of this Agreement until the earlier of the Effective Time or the termination of
this Agreement to (i) all of its respective properties, books, contracts,
commitments and records, and (ii) all other information concerning its business,
properties and personnel as such party may reasonably request. No information or
knowledge obtained in any investigation pursuant to this Section shall affect or
be deemed to modify any representation or warranty contained herein or the
conditions to the obligations of the parties to consummate the Merger.
ARTICLE 5
THE CLOSING
The closing ("CLOSING") of the Merger and any other transactions
contemplated by this Agreement shall take place at the law offices of ▇▇▇▇▇▇▇▇▇
Ball ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇, LLP, ▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇ within ten (10) days after satisfaction of the conditions set forth in
Article 6 hereof, but no later than March 31, 2004, or at such other place and
time and on such other date, as the parties may agree upon in writing ("CLOSING
DATE").
ARTICLE 6
CONDITIONS TO CLOSING
The obligations of each party to engage in the transactions
contemplated by this Agreement are subject to the fulfillment, prior to or on
the Closing Date, of the following conditions:
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(a) ARC shall have complied with Regulation 14A or Regulation 14C, as the case
may be, under the Exchange Act and shall have obtained the approval of the
holders of the requisite number of shares of ARC Common Stock to (i) an
amendment to the articles of incorporation of ARC to (A) increase the number of
authorized shares of ARC Common Stock to 150,000,000 shares and (B) change the
name of ARC to RoomLinX, Inc., or such other name as RoomLinX may direct (the
"AMENDED CERTIFICATE"), (ii) the Merger, and (iii) the ARC Sale;
(b) RoomLinX, ARC and RL shall have received all requisite approvals by
government agencies and authorities and all consents and approvals of third
parties as are required for the consummation of the Merger;
(c) This Agreement, the Related Agreements and the transactions contemplated
herein and therein, including the Merger, shall have been approved by (i) the
Boards of Directors of each of RoomLinX, ARC and RL, (ii) the RoomLinX
Stockholders and (iii) ARC as the sole stockholder of RL;
(d) The Amended Certificate shall have been filed;
(e) An audit of RoomLinX performed by Deloitte & Touche LLP shall have been
completed and the Audited RoomLinX Financials Statements delivered to ARC for
inclusion in the Proxy Statement or Information Statement;
(f) RoomLinX will certify that (i) all issued and outstanding options,
convertible debentures and warrants of RoomLinX have been converted into
RoomLinX Shares, other than the Permitted Debt, and (ii) RoomLinX has a positive
net worth.
(g) The executive offices of the Surviving Corporation shall be relocated to the
New York metropolitan area or as otherwise determined by the Board of Directors
of the Surviving Corporation;
(h) Effective as of the Effective Time, the Board of Directors of the Surviving
Corporation shall be comprised of the RoomLinX Designees, the ARC Designee and
two directors designated by the RoomLinX Designees and the ARC Designee;
(i) The ARC Sale shall have closed prior to the Closing;
(j) ARC shall have raised $500,000 in a private placement of ARC securities;
(k) RoomLinX shall have raised $400,000 in a private placement of RoomLinX
securities;
(l) The holders of less than ten (10%) percent of the issued and outstanding
RoomLinX Shares will have exercised appraisal rights under Nevada Law as
Dissenting Stockholders. RoomLinX and ARC will have resolved all matters of
appraisal and payment under Nevada Law for each Dissenting Stockholder;
(m) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ shall have received one
year extensions on their employment agreements from the Closing Date;
16
(n) The Escrow Agreement shall have been duly executed and
delivered by all parties thereto; and
(o) ARC shall have issued to (1) Alliance Advisors and Roccus
Capital Partners or their designees an aggregate of 2,000,000 shares of ARC
Common Stock, (2) ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇ (who shall continue as a director of ARC)
options to purchase 500,000 shares of ARC Common Stock at an exercise price of
$0.08 per share and (3) ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇, options to purchase 250,000 shares
of ARC Common Stock at an exercise price of $0.20 per share having a three (3)
year term and "cashless exercise" provisions, and 250,000 shares of ARC Common
Stock. All shares and options to purchase ARC Common Stock referred to in this
Section 6(n) shall be registered on Form S-8 promptly after the Effective Date.
ARTICLE 7
OBLIGATIONS OF ROOMLINX AT CLOSING
At the Closing, RoomLinX or the RoomLinX Stockholders (as the case may
be) shall have delivered to ARC all of the resolutions, certificates, documents
and instruments required by this Agreement, including, without limitation:
(a) Stock certificates for all of the RoomLinX Shares duly
endorsed for transfer or accompanied by duly executed stock powers executed in
blank;
(b) Certificate of Merger;
(c) Certificate of Good Standing from the Secretary of State
of the State of Nevada;
(d) Resolutions of the Board of Directors of RoomLinX and the
RoomLinX Stockholders approving the execution and delivery of this Agreement and
the Related Agreements, the consummation of the transactions contemplated hereby
and thereby, the consummation of the Merger and the filing of the Certificate of
Merger, and certified copies of the articles of incorporation, as amended, and
bylaws, as amended, of RoomLinX, all certificated by the Secretary of RoomLinX;
and
(e) Officer's certificate signed by the Chief Executive
Officer of RoomLinX to the effect that (i) the representations and warranties of
RoomLinX set forth in this Agreement are true and correct in all material
respects on and as of the Closing Date; (ii) there shall have been no RoomLinX
Material Adverse Change from the date of this Agreement through the Closing
Date; and (iii) all covenants requiring pre-Closing performance have been
performed.
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ARTICLE 8
OBLIGATIONS OF ARC AND RL AT CLOSING
At the Closing, ARC or RL (as the case may be) shall have delivered to
RoomLinX all of the resolutions, certificates, documents and instruments
required by this Agreement, including, without limitation:
(a) Stock certificates representing the ARC Merger Shares to
the RoomLinX Stockholders;
(b) Amended Certificate;
(c) Certificate of Merger;
(d) Certificate of Good Standing from the Secretary of State
of the State of New Jersey for ARC and the Secretary of State of the State of
Nevada for RL;
(e) Resolutions of the Board of Directors and stockholders of
ARC and RL approving the execution and delivery of this Agreement and the
Related Agreements, the consummation of the transactions contemplated hereby and
thereby, the consummation of the Merger, the filing of the Certificate of Merger
and the filing of the Amended Certificate, and certified copies of each
corporation's articles of incorporation, as amended, and bylaws, as amended, all
certificated by the Secretary of ARC and RL;
(f) Resignations of all officers and directors of ARC and RL,
effective as of the Effective Date; and
(g) Officer's certificate signed by the Chief Executive
Officer of each of ARC and RL to the effect that (i) the representations and
warranties of ARC and RL set forth in this Agreement are true and correct in all
material respects on and as of the Closing Date; (ii) there shall have been no
ARC-RL Material Adverse Change from the date of this Agreement through the
Closing Date; and (iii) all covenants requiring pre-Closing performance have
been performed.
ARTICLE 9
TERMINATION
This Agreement may be terminated and the merger and the other
transactions contemplated by this Agreement may be abandoned at any time prior
to the Effective Time, notwithstanding any requisite approval and adoption of
this Agreement and the transactions contemplated by this Agreement, as follows:
(a) by the parties, following mutual written consent duly
authorized by the Boards of Directors of each of the parties hereto;
18
(b) by RoomLinX or ARC (on behalf of RL), if the Effective
Time shall not have occurred as soon as reasonably practicable but no later than
March 31, 2004; provided, however, that the right to terminate this Agreement
under this Section 9(b) shall not be available if the reason the Effective Time
has not occurred is the intentional failure by the party seeking termination to
fulfill any obligation under this Agreement;
(c) by RoomLinX, following discovery of: (i) information that,
in the reasonable discretion of RoomLinX, may be material and adverse to either
ARC or RL or their respective businesses, or constitutes an ARC-RL Material
Adverse Change on a going forward basis; or (ii) a breach of any representation
or warranty made by ARC or RL contained in Article 3 hereof; or
(d) by ARC (on its own behalf and on behalf of RL), following
discovery of: (i) information that, in the reasonable discretion of ARC, may be
material and adverse to RoomLinX or the Business, or constitutes a RoomLinX
Material Adverse Change on a going forward basis; or (ii) a breach of any
representation or warranty made by RoomLinX contained in Article 2 hereof.
In the event of termination of this Agreement pursuant to this Article
9, this Agreement shall forthwith become void and there shall be no liability
under this Agreement on the part of any party, or any of their respective
officers or directors; provided, however, that nothing herein shall relieve any
party from liability for the willful breach of any of its representations,
warranties, covenants or agreements set forth in this Agreement.
ARTICLE 10
MISCELLANEOUS
SECTION 10.1 EXPENSES. Each party shall bear its own expenses in
connection with this Agreement and the transactions contemplated hereby.
SECTION 10.2 INDEMNIFICATION. In consideration of the execution and
delivery of this Agreement by ARC and RL, RoomLinX agrees to indemnify, defend
and hold each of ARC and RL and their respective officers and directors,
employees and agents (herein called the "ARC-RL INDEMNITEES"), harmless from and
against any and all claims, actions, causes of action, suits or other
proceedings (whether or not such ARC-RL Indemnitee is a party thereto), losses,
liabilities and damages, and expenses in connection therewith, including,
without limitation, reasonable fees and disbursements of counsel (herein called
the "ARC-RL INDEMNIFIED LIABILITIES," which term shall not include, however,
liabilities incurred by reason of the gross negligence or willful misconduct of
an ARC-RL Indemnitee) incurred by the ARC-RL Indemnitees or any of them (i) as a
result of, or arising out of, or relating to any failure of any representation
or warranty set forth in Section 2 to be true and correct when made or any
failure by RoomLinX to comply in any material respect with any of its covenants
or agreements set forth in this Agreement or (ii) any claim by LeaseTek or its
successors against the ARC-RL Indemnitees. In consideration of the execution and
delivery of this Agreement by RoomLinX, each of ARC and RL agrees to indemnify,
defend and hold RoomLinX and its officers and directors, employees and agents
(collectively, the "ROOMLINX INDEMNITEES"), harmless from and against any and
all claims, actions, causes of action, suits or other proceedings (whether or
not such RoomLinX Indemnitee is a party thereto), losses, liabilities and
damages, and expenses in connection therewith, including, without limitations,
reasonable fees and disbursements of counsel (herein called the "ROOMLINX
INDEMNIFIED LIABILITIES," which term shall not include, however, liabilities
incurred by reason of the gross negligence or willful misconduct of a RoomLinX
Indemnitee) incurred by the RoomLinX Indemnitees or any of them as a result of,
or arising out of, or relating to, any failure of any representation or warranty
set forth in Section 3 to be true and correct when made or any failure by ARC or
RL to comply with its covenants or agreements set forth in this Agreement. The
provisions of, and obligations of RoomLinX, ARC and RL under, this Section shall
be enforceable by each ARC-RL Indemnitee or RoomLinX Indemnitee separately or
together with other ARC-RL Indemnitees or RoomLinX Indemnitees, as the case may
be, and any such ARC-RL Indemnitee or RoomLinX Indemnitee seeking to enforce the
indemnification provided for hereunder may initially proceed directly against
RoomLinX, ARC or RL, as the case may be, without first resorting to any other
rights of indemnification or otherwise that it may have.
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SECTION 10.3 HEADINGS. The subject headings of this Agreement are
included for purposes of convenience only, and shall not affect the construction
or interpretation of any of its provisions.
SECTION 10.4 CONFIDENTIALITY. The parties to this Agreement shall hold,
and shall cause their representatives to hold, all negotiations, information and
documents delivered pursuant to this Agreement confidential and shall not
disclose for any reason, except as provided below, any such information without
the prior written consent of the party to whom such information relates. If the
transactions contemplated by this Agreement are not consummated for any reason,
each party shall destroy or return to the other party all such information and
documents and any copies as soon as practicable and not disclose any such
information (that has not previously been disclosed by a party other than the
relevant party) to any third party unless required to do so pursuant to a
requirement or order under applicable laws and regulations or pursuant to a
subpoena or other legal process.
SECTION 10.5 ENTIRE AGREEMENT, MODIFICATION AND WAIVER. This Agreement,
together with the agreements referenced herein or contemplated hereby,
constitutes the entire agreement between the parties pertaining to its subject
matter and supersede all prior and contemporaneous agreements, representations
and understandings of the parties. No supplement, modification or amendment of
this Agreement shall be binding unless executed in writing by all the parties.
No waiver of any of the provisions of this Agreement shall be deemed, or shall
constitute, a waiver of any other provision, whether or not similar, nor shall
any waiver constitute a continuing waiver. No waiver shall be binding unless
executed in writing by the party making the waiver.
SECTION 10.6 FURTHER ACTION. Each of the parties hereto shall use its
reasonable best efforts to (i) take, or cause to be taken, all appropriate
action and do, or cause to be done, all things necessary, proper or advisable
under applicable law or otherwise to consummate and make effective the
transactions contemplated by the Agreement, and (ii) make all necessary filings,
and thereafter make any other required submissions, with respect to the
Agreement and the transactions contemplated hereby. The parties hereto shall
cooperate with each other in connection with the timely making of all such
filings, including by providing copies of all such documents to the other party
and its advisors prior to filing and, if requested, by accepting all reasonable
additions, deletions or changes suggested in connection therewith.
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SECTION 10.7 PUBLICITY. No party to this Agreement shall issue any
press release or other public statement relating to this Agreement or the
transactions contemplated hereby without the prior written approval of the other
parties.
SECTION 10.8 COUNTERPARTS. This Agreement may be executed
simultaneously in one or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.
SECTION 10.9 RIGHTS OF PARTIES. Nothing in this Agreement, whether
expressed or implied, is intended to confer any rights or remedies under or by
reason of this Agreement on any persons other than the parties hereto and their
respective successors and assigns, nor is anything in this Agreement intended to
relieve or discharge the obligation or liability of any third persons to any
party to this Agreement, nor shall any provision give any third persons any
right of subrogation or action over or against any party to this Agreement.
SECTION 10.10 ASSIGNMENT. Neither RL nor ARC shall assign this
Agreement to any person or entity without the prior written consent of RoomLinX.
RoomLinX shall not assign this Agreement to any person or entity without the
prior written consent of ARC. Subject to the previous sentence, this Agreement
shall be binding on, and shall inure to the benefit of, the parties hereto and
their respective heirs, legal representatives, successors and permitted assigns.
Any assignment or attempted assignment in violation of the provisions of this
Section shall be void.
SECTION 10.11 REMEDIES. Each party's obligation under this Agreement is
unique. If any party should default in its obligations under this Agreement, the
parties each acknowledge that it would be extremely impracticable to measure the
resulting damages; accordingly, the nondefaulting party, in addition to any
other available rights or remedies, may ▇▇▇ in equity for specific performance,
and the parties each expressly waive the defense that a remedy in damages will
be adequate.
SECTION 10.12 EFFECT OF CERTAIN ACTIONS. No action taken pursuant to or
related to this Agreement, including without limitation any investigation by or
on behalf of any party, shall be deemed to constitute a waiver by the party
taking such action of compliance with any representation, warranty, condition or
agreement contained herein.
SECTION 10.13 NOTICES. All notices, requests and other communications
under this Agreement shall be in writing and shall be deemed to have been duly
given on the date of service if served personally on the party (including
without limitation service by overnight courier service) to whom notice is to be
given, or on the third day after mailing if mailed to the party to whom notice
is to be given, by first class mail, registered or certified, postage prepaid,
at the address set forth below, or on the date of service if delivered by
electronic mail or facsimile to the facsimile number set forth below which
facsimile is confirmed. Any party may change its address for purposes of this
paragraph by giving the other parties written notice of the new address in the
manner set forth above.
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If to RoomLinX: RoomLinX, Inc.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇ ▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Facsimile:
With a copy to: ▇▇▇▇▇, ▇▇▇▇▇▇ Barristers & Solicitors
▇▇▇-▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 604
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to ARC or to RL: Arc Communications Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to: ▇▇▇▇▇▇▇▇▇ Ball ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇, LLP
▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
SECTION 10.14 SEVERABILITY. If any provision of this Agreement shall be
declared by any court of competent jurisdiction to be illegal, void or
unenforceable, all other provisions of this Agreement shall not be affected and
shall remain in full force and effect.
SECTION 10.15 GOVERNING LAW; VENUE. This Agreement shall be construed
in accordance with, and governed by, the law of the State of New York without
regard to any principles of conflicts of law. The parties hereby agree that any
action, suit, arbitration or other proceeding arising out of or related to this
Agreement shall be brought, maintained and conducted only in New York, and each
party hereby irrevocably consents and submits to the personal jurisdiction of
and venue in the United States District Court for the Eastern District of New
York and the New York State Courts in any such proceeding.
SECTION 10.16 LEGAL FEES. In the event any legal action or proceeding
is instituted to enforce or interpret any of the provisions of this Agreement,
the prevailing party shall be entitled to reasonable attorneys' fees and
disbursements.
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SECTION 10.17 SCHEDULES AND EXHIBITS. The Schedules and Exhibits
attached to this Agreement are a part hereof as if fully set forth herein.
SECTION 10.18 TIME OF ESSENCE. Time is of the essence for each and
every provision of this Agreement where time is a factor.
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IN WITNESS WHEREOF, the parties to this Agreement have duly executed it
as of the day and year first set forth above.
ROOMLIINX, INC.
By:
--------------------------------
Name: ______________________________
Title:
-----------------------------
ARC COMMUNICATIONS INC.
By:
--------------------------------
Name: ______________________________
Title:
-----------------------------
RL ACQUISITION, INC.
By:
--------------------------------
Name: ______________________________
Title:
-----------------------------
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