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For More Information Contact:
Public Relations:
Ilya Welfeld
201-439-1010
iwelfeld@roomlinx.com
Investor Relations
Thomas J. Rozycki, Jr.
Cubitt Jacobs & Prosek
212-279-3115 x208
tom@cjpcom.com
ROOMLINX ANNOUNCES PLANS FOR A MERGER WITH DISC WIRELESS - MARKING
SIGNIFICANT EXPANSION OF BUSINESS STRATEGY
Merger Will Expand RoomLinX Service Offerings, Broaden Customer Base
and Provide Diversified Revenue Streams to Enhance Shareholder Value
Hackensack, New Jersey (June 27, 2005) -RoomLinX, Inc. (OTCBB: RMLX.OB), a
leading provider of wireless high-speed network solutions to the hospitality
industry, today announced that it has signed a non-binding Letter of Intent for
a merger with privately-held Digital Internet Services Corporation (DISC), a
leading Internet Services provider in Southern California. Founded in 1996, DISC
currently provides a wide range of Internet services including: Corporate
Internet Access, Wireless Internet Access, Virtual Private Networks, High
Performance Web Hosting, Co-location Services, Dedicated Servers and Structured
Wiring Service to under-served markets. Under the terms of the proposed
arrangement, the transaction will be structured as a merger of DISC and
RoomLinX. RoomLinX will issue approximately 110,000,000 of its outstanding
common stock. The shares issued to DISC's shareholders will be subject to
piggyback registration rights to be granted by RoomLinX.
"This proposed merger is a significant development for RoomLinX and its
shareholders. The board and the management team anticipate that it will
translate into increased success in our current business as well as a sizable
opportunity in new markets," said Aaron Dobrinsky, CEO of RoomLinX. "The merger
would represent an important expansion of RoomLinX's strategy. Not only will we
continue to deepen our footprint in the hotel and convention center space, but
we will now have a fixed wireless technology platform from which to build out
new infrastructure and opportunities, one of our highest priority targets."
RoomLinX and DISC expect to structure the new merged entity into two divisions:
the first would focus on growing RoomLinX's current business, and the second
would continue DISC's plans to foster market leadership in the fixed wireless
space.
The merger is subject to completion of due diligence, execution of a mutually
satisfactory definitive agreement, approval of the Boards and shareholders of
both companies and other conditions to be set forth in the definitive agreement.
Assuming satisfaction of these conditions, the transaction is expected to be
completed in the third or fourth quarters of this year.
"DISC has a proven operating model; we see the merger as an opportunity for us
to expand into additional markets where demand for high-speed Internet access
greatly exceeds its availability," said Ralph Thompson, Co-founder and CEO of
DISC. "Due to lack of adequate infrastructure and the high cost of wired
connectivity, under-served regions have yet to benefit from the high-speed,
always on Internet services much of the country takes for granted. Fixed
wireless is the solution for these markets, presenting a robust and nascent
business opportunity. Our merger with RoomLinX would allow the combined entity
to provide services nationwide."
Under the new operational structure, one division will continue to provide
high-speed wireless services to the hospitality industries and convention
centers. With the addition of DISC services, RoomLinX will become one of the
few, if not the only, player in its industry to offer hotels both broadband
wireless infrastructure and wi-fi capabilities. Additionally, both companies
already offer and will continue to offer hotels value added services such as
voice-over-IP, wireless security and other solutions. By enhancing its current
offerings through backend solutions, RoomLinX anticipates opportunities for
increased sales and revenue.
The new division would be comprised of current DISC functions and is expected to
be run by Rod Vandenbos, co-founder and President of DISC. This unit will both
provide support to the hospitality business and function as a separate division
aimed at bringing broadband services to geographic areas not already
sufficiently serviced by traditional methods. This division will continue to
offer the wide range of broadband solutions currently offered by DISC but would
look to expand its reach throughout the U.S.
The merged companies will combine call center, tech support, equipment
management, staging and pre-installation functions and will utilize the existing
DISC facility in California to house critical operational functions. The
company's main operations will be run from RoomLinX's exisiting Hackensack, NJ
headquarters.
About DISC
DISC is one of the country's first and largest commercial Broadband Fixed
Wireless providers. With an eight year history of offering broadband services,
DISC has pioneered the delivery of scalable wireless services to meet customers'
bandwidth needs and a suite of additional services, such as Virtual Private
Network (VPN) and Voice over Internet Protocol (VoIP), in areas where these
services are almost totally unavailable but where demand is extremely high.
Aside from being the only known provider of these services in many markets, DISC
provides services that are scalable, adjusting to meet the current and future
needs of its business and consumer clientele. The company's services are
delivered via DISC's state-of-the-art Network Operations Center and distribution
towers within its market areas, delivering DISC's wireless technology directly
to the customer.
About RoomLinX, Inc.
RoomLinX is a pioneer in Broadband High Speed Wireless Internet connectivity,
specializing in providing WI-FI Wireless and Wired networking solutions for High
Speed Internet access to Hotel Guests, Convention Center Exhibitors, Corporate
Apartments, and Special Event participants. Designing, deploying and servicing
site-specific wireless networks for the hospitality industry is RoomLinX's core
competency.
# # #
The statements contained in this press release of RoomLinX, Inc. (the "Company")
that are not based on historical fact are "forward-looking statements". Such
forward-looking statements involve risks and uncertainties, including but not
limited to: (i) the Company's history of unprofitable operations, both with
respect to its core business and the business previously performed by Arc
Communications, (ii) the significant operating losses that the Company has
incurred to date, (iii) the Company's lack of liquidity and need for additional
capital which it may not be able to obtain on favorable terms or at all, (iv)
the "going concern" qualifications that accompanies the Company's financial
statements, which, among other things, may make it more difficult for the
Company to raise the additional capital that it requires in order to remain in
business, (v) the fact that the Company has been required to operate with a
working capital deficit, which limits its operating flexibility and
opportunities, (vi) the substantially greater resources available to many of the
Company's competitors, (vii) the Company's expectation that it will continue to
operate at a loss for the foreseeable future, (viii) the fact that the Company's
lack of capital substantially restricts its flexibility and opportunity to
increase its revenues, (ix) the importance to the Company that its offerings
remain technologically advanced if the Company is to attract new customers and
maintain existing customers, (x) the Company's dependence on certain key
employees and key suppliers, (xi) risks associated with potential intellectual
property claims, (xii) the impact on the Company's business and industry of
general economic conditions and regulatory developments and (xiii) risks
associated directly with the proposed business combination, including without
limitation (a) the possibility that the parties are unable to reach a definitive
agreement or close the proposed transaction, (b) the possibility that the
benefits anticipated from the transaction are not realized and (c) risks
associated with integrating two separate businesses.. Such risks and others are
and shall be more fully described in the "Risk Factors" set forth in the
Company's filings with the Securities and Exchange Commission. The Company's
actual results could differ materially from the results expressed in, or implied
by, such forward-looking statements.