EXHIBIT 10.1
AGREEMENT AND PLAN OF MERGER
This Agreement and Plan of Merger (this "Agreement") is made and entered
into as of the 10th day of August, 2005, by and among RoomLinX, Inc., a Nevada
corporation ("RMLX"), SS-R Acquisition Corp., a Delaware corporation and a
wholly owned subsidiary of RMLX ("Subcorp"), and SuiteSpeed, Inc., a Delaware
corporation ("SuiteSpeed").
PRELIMINARY STATEMENTS
A. RMLX desires to combine its business with the business presently
operated by SuiteSpeed (the "SuiteSpeed Business") through the merger of Subcorp
with and into SuiteSpeed, with SuiteSpeed as the surviving corporation (the
"Merger"). Pursuant to the Merger, each share of SuiteSpeed's capital stock
outstanding at the Effective Time will be converted into the right to receive
RMLX Common Stock and cash in lieu of fractional shares, and SuiteSpeed will
become a wholly owned subsidiary of RMLX, all as more fully provided herein.
B. The Board of Directors of SuiteSpeed has determined that the Merger is
consistent with and in furtherance of the long-term business strategy of
SuiteSpeed and that it is in the best interests of the holders of shares of
SuiteSpeed's capital stock to have a continuing equity interest in the combined
businesses of RMLX and SuiteSpeed through the ownership of RMLX Common Stock.
C. The respective Boards of Directors of RMLX, Subcorp and SuiteSpeed have
determined that the Merger, structured in the manner contemplated herein, is
desirable and in the best interests of their respective stockholders and, by
resolutions duly adopted, have approved and adopted this Agreement.
D. Stockholders owning at least 98% of the outstanding shares of
SuiteSpeed Common Stock are expected to execute a consent approving this
Agreement and the Merger.
E. The parties intend that the Merger constitute a "reorganization" within
the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended
(the "Code").
F. The parties desire that at the Closing, the existing notes payable to
Michael Wasik by SuiteSpeed in the aggregate principal amount of $170,000 will
be converted into shares of RMLX Common Stock as described herein.
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereby adopt this Agreement as and for a Plan of Merger (the "Plan")
under Section 368(a) of the Code, and in order to implement the Plan, the
parties hereby represent, warrant, covenant and agree as follows:
ARTICLE I
DEFINITIONS
1.1 Specific Definitions. For purposes of this Agreement, the following
terms shall have the following meanings:
"Affiliate" shall mean, with respect to any entity (the "Subject Entity"),
any person or other entity which controls, is controlled by, or is under common
control with, the Subject Entity.
"Average Market Price", on a particular Trading Day, shall mean the
average of the high bid price and the low asked price of one share of RMLX
Common Stock on the OTC Bulletin Board on such Trading Day, as such bid and
asked prices are reported by Bloomberg L.P., or if such bid and asked prices are
not reported by Bloomberg L.P., as furnished by Pink Sheets LLC.
"Business Day" shall mean a Monday, Tuesday, Wednesday, Thursday or Friday
other than a day on which commercial banks in the State of New Jersey are not
open for business.
"Certificates" shall mean stock certificates that, immediately prior to
the Effective Time, represent shares of SuiteSpeed Common Stock to be converted
into the right to receive RMLX Common Stock pursuant to Section 2.7.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.
"FNB Notes" shall mean the promissory notes payable by SuiteSpeed to First
National Bank of Colorado in the aggregate principal amount of $300,000, copies
of which have been furnished to RMLX prior to the date hereof.
"GAAP" shall mean United States generally accepted accounting principles,
consistently applied.
"Laws" shall mean all statutes, laws, rules, regulations, orders and
ordinances relating to SuiteSpeed and its Subsidiaries or RMLX and its
Subsidiaries.
"Liens" shall mean liens, encumbrances, security interests, pledges, title
restrictions and other limitations on use, other than restrictions on transfer
imposed by federal or state securities laws.
"Parties" shall mean the parties hereto; "Party" shall mean any of the
parties hereto.
"Person" means any individual, corporation, partnership, limited liability
company, business trust, sole proprietorship or other entity.
"Pre-Closing Tax Period" shall mean any period ending on or before the
Closing Date for which the Tax obligations of SuiteSpeed and its Subsidiaries or
RMLX and its Subsidiaries may be measured.
"Reasonable Best Efforts" shall mean best efforts, to the extent
commercially reasonable.
"RMLX Common Stock" shall mean the common stock, par value $.001 per
share, of RMLX.
"RMLX Material Adverse Effect" shall mean a material adverse effect on the
business, operations, assets, financial condition, results of operations or
prospects of RMLX and its Subsidiaries, taken as a whole, or a material adverse
affect on the ability of the Parties to consummate the transactions contemplated
hereby on a timely basis.
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"SEC" shall mean the Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Stockholder Consent Documents" shall mean (a) consents, executed
subsequent to the execution of this Agreement and in form and substance
satisfactory to RMLX, pursuant to which stockholders of SuiteSpeed owning at
least 98% of the outstanding shares of SuiteSpeed Common Stock shall have
approved the Merger and this Agreement ("SuiteSpeed Stockholder Consents") and
(b) a notice, in form and substance satisfactory to RMLX, pursuant to which
SuiteSpeed shall notify all other stockholders, in accordance with Section 262
of the Statute, that the Merger has been approved (the "262 Letter").
"SuiteSpeed Common Stock" shall mean the common stock, par value $0.0001
per share, of SuiteSpeed.
"SuiteSpeed Employee" shall mean a Person who is an employee of SuiteSpeed
or its Subsidiaries immediately prior to the Effective Time and becomes an
employee of the Surviving Corporation, RMLX or its Subsidiaries immediately
after the Effective Time.
"SuiteSpeed Material Adverse Effect" shall mean a material adverse effect
on the business, operations, assets, financial condition, results of operations
or prospects of SuiteSpeed and its Subsidiaries, taken as whole, or a material
adverse affect on the ability of the Parties to consummate the transactions
contemplated hereby on a timely basis.
"SuiteSpeed Options" shall mean all options to purchase or acquire shares
of SuiteSpeed Common Stock, whether issued by SuiteSpeed pursuant to
SuiteSpeed's stock option plans or otherwise.
"Stockholder" or "SuiteSpeed Stockholder" shall mean each holder of
SuiteSpeed Common Stock immediately prior to the Effective Time.
"Subsidiary" when used with reference to a Person, shall mean any entity
(i) the accounts of which would be consolidated with those of such Person in
such Person's financial statements if such financial statements were prepared in
accordance with GAAP or (ii) of which securities or other ownership interests
representing more than 50% of the equity or more than 50% of the ordinary voting
power or, in the case of a partnership, more than 50% of the general partnership
interests or more than 50% of the profits or losses are owned, controlled or
held by such Person and/or one or more subsidiaries of such Person.
2. "Tax", "tax", "Taxes" or "taxes" shall mean any of the following
imposed by or payable to any governmental authority: any income, gross receipts,
license, payroll, employment, excise, severance, stamp, business, occupation,
premium, windfall profits, environmental (including taxes under Section 59A of
the Code), capital stock, franchise, profits, withholding, social security (or
similar), unemployment, disability, real property, personal property, sales,
use, transfer, registration, or value added tax, any alternative or add-on
minimum tax, any estimated tax, and any levy, impost, duty, assessment,
withholding or any other governmental charge of any kind whatsoever, in each
case including any interest, penalty, or addition thereto, whether disputed or
not.
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3. "Tax Returns" or "tax returns" shall mean all returns and reports with
respect to sales, franchise, income and all other Taxes.
1.2 Additional Definitions. The following terms are defined in the
following sections of this Agreement:
TERM SECTION
Agreement Opening Paragraph
Benefit Plan 3.18.1
Certificate of Merger 2.2
Closing 2.2
Closing Date 2.2
Code Preliminary Statement E
Copyrights 3.10.1
Debt 3.2.3
Disposition 2.16.1
Dissenting Shares 2.9.1
Effective Time 2.2
Employment Agreement 6.3.2
Enforcement Notice 3.24.1.2
Environmental Law 3.24.1.4
ERISA 3.18.1
Fully Diluted Number 2.7.1
Intellectual Property 3.10.1
Laws 3.23
Maskworks 3.10.1
Merger Preliminary Statement A
Merger Conversion Number 2.7.1
Merger Share Number 2.7.1
Option Plan 2.15.1
Parties Lead-in
Patents 3.10.1
Pension Plan 3.18.2
Plan Lead-in
Plan of Reorganization 2.14
Registered Intellectual Property 3.10.1
Registration Rights Agreement 6.4.3
Regulated Substance 3.24.1.2
Releasing 3.24.1.3
RMLX Opening Paragraph
RMLX Business 4.1.1
RMLX Common Stock 1.1
RMLX Current Balance Sheet 4.1.1
RMLX Debt 4.2.2
RMLX Disclosure Schedule 4.1.1
RMLX Intellectual Property 4.4.1
RMLX Preferred Stock 4.2.1
RMLX Registered Intellectual Property 4.4.2
RMLX SEC Documents 4.6
RMLX Statement Date 4.9
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Secretary of State 2.2
Statement Date 3.28
Statute 2.1
Subcorp Opening Paragraph
Subject Entity 1.1
SuiteSpeed Opening Paragraph
SuiteSpeed Affiliate's Letter 6.2.5
SuiteSpeed Business Preliminary Statement A
SuiteSpeed Current Balance Sheet 3.1.1
SuiteSpeed Disclosure Schedule 3.1.1
SuiteSpeed Employees 5.1
SuiteSpeed Financial Statements 3.25.1
SuiteSpeed Intellectual Property 3.10.1
SuiteSpeed Internal Controls 3.25.4
SuiteSpeed Real Property Leases 3.7.1
SuiteSpeed Registered Intellectual Property 3.10.2
SuiteSpeed Statement Date 3.28
Surviving Corporation 2.1
Tax Counsel 6.1
Tax Returns 3.26.1
Trademarks 3.10.1
1.3 Interpretation. Unless otherwise indicated to the contrary herein by
the context or use thereof: (i) the words, "herein," "hereto," "hereof" and
words of similar import refer to this Agreement as a whole and not to any
particular Section or paragraph hereof; (ii) words importing the masculine
gender shall also include the feminine and neutral genders, and vice versa;
(iii) words importing the singular shall also include the plural, and vice
versa; and (iv) the word "including" means "including without limitation". This
Agreement represents a collaborative effort undertaken by the Parties.
Accordingly, this Agreement is not to be strictly construed against either Party
by virtue of the identity of the draftsperson of any provision of this Agreement
or of this Agreement as a whole. ARTICLE II
THE MERGER
2.1 The Merger. Upon the terms and subject to the conditions hereof, and
in accordance with the applicable provisions of the General Corporation Law of
the State of Delaware (the "Statute"), Subcorp shall be merged with and into
SuiteSpeed at the Effective Time. As a result of the Merger, the separate
corporate existence of Subcorp shall cease and SuiteSpeed shall continue its
existence under the laws of the State of Delaware. SuiteSpeed, in its capacity
as the corporation surviving the Merger, is hereinafter sometimes referred to as
the "Surviving Corporation."
2.2 Effective Time. As promptly as possible on the Closing Date, the
parties shall cause the Merger to be consummated by filing with the Secretary of
State of the State of Delaware (the "Secretary of State") a certificate of
merger (the "Certificate of Merger") in such form as is required by and executed
in accordance with Section 251 of the Statute. The Merger shall become effective
(the "Effective Time") upon filing of the Certificate of Merger with the
Secretary of State or at such later time and date as shall be agreed upon by
RMLX and SuiteSpeed and specified in the Certificate of Merger. Prior to the
filing referred to in this Section 2.2 but after SuiteSpeed has delivered to
RMLX the Stockholder Consent Documents, a closing (the "Closing") shall be held
at the offices of Lowenstein Sandler PC, 65 Livingston Avenue, Roseland, New
Jersey 07068 or such other place as the parties may agree, on the first business
day after the date on which the Stockholder Consent Documents are delivered to
RMLX (such date, the "Closing Date") or on such other date as the parties may
agree.
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2.3 Effects of the Merger. From and after the Effective Time, the Merger
shall have the effects set forth in this Agreement, the Certificate of Merger
and the applicable provisions of the Statute. Without limiting the generality of
the foregoing, and subject thereto, at the Effective Time, all of the property,
rights, privileges, powers and franchises of SuiteSpeed and Subcorp shall vest
in the Surviving Corporation, and all of the debts, liabilities, obligations,
restrictions, disabilities and duties of SuiteSpeed and Subcorp shall become the
debts, liabilities, obligations, restrictions, disabilities and duties of the
Surviving Corporation.
2.4 Certificate of Incorporation and Bylaws.
2.4.1 The certificate of incorporation of SuiteSpeed shall be
amended in the Merger to read in its entirety as set forth on Annex A to the
Certificate of Merger that is attached hereto as Appendix 2.4 and as so amended
shall be the certificate of incorporation of the Surviving Corporation until
thereafter amended as provided therein and by law.
2.4.2 The by-laws of Subcorp, as in effect immediately prior to the
Effective Time, shall be the by-laws of the Surviving Corporation until
thereafter amended as provided therein, in the certificate of incorporation of
the Surviving Corporation and by law.
2.5 Directors and Officers of the Surviving Corporation. From and after
the Effective Time, (a) the directors of Subcorp immediately prior to the
Effective Time shall be the initial directors of the Surviving Corporation, each
to hold office in accordance with applicable law, the certificate of
incorporation and by-laws of the Surviving Corporation, and (b) the officers of
Subcorp immediately prior to the Effective Time shall be the initial officers of
the Surviving Corporation, in each case until their respective successors are
duly elected or appointed and qualified.
2.6 Additional Actions. If, at any time after the Effective Time, the
Surviving Corporation shall consider or be advised that any further deeds,
assignments or assurances in law or any other acts are necessary or desirable to
(a) vest, perfect or confirm, of record or otherwise, in the Surviving
Corporation its right, title or interest in, to or under any of the rights,
properties or assets of SuiteSpeed or Subcorp, or (b) otherwise carry out the
provisions of this Agreement, SuiteSpeed and Subcorp and their respective
officers and directors shall be deemed to have granted to the Surviving
Corporation an irrevocable power of attorney to execute and deliver all such
deeds, assignments or assurances in law and to take all acts necessary, proper
or desirable to vest, perfect or confirm title to and possession of such rights,
properties or assets in the Surviving Corporation and otherwise to carry out the
provisions of this Agreement, and the officers and directors of the Surviving
Corporation are authorized to act on its behalf in the name of SuiteSpeed and
Subcorp or otherwise to take any and all such actions.
2.7 Conversion of Securities.
2.7.1 Additional Definitions. For purposes of this Agreement, the
following terms shall have the following meanings:
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"Fully Diluted Number" shall mean the sum of (i) the number of
shares of SuiteSpeed Common Stock outstanding immediately prior to the Effective
Time and, (ii) the number of shares of SuiteSpeed Common Stock covered by
SuiteSpeed Options outstanding immediately prior to the Effective Time.
"Merger Conversion Number" shall mean the Merger Share Number
divided by the Fully Diluted Number, rounded to four decimal places.
"Merger Share Number" shall mean 21,450,000.
2.7.2 Conversion. At the Effective Time, by virtue of the Merger and
without any action on the part of the Parties or the holders of any of the
following securities:
2.7.2.1 each issued and outstanding share of common stock of
Subcorp shall be converted into one validly issued, fully paid and nonassessable
share of common stock, par value $0.0001 per share, of the Surviving
Corporation;
2.7.2.2 each share of SuiteSpeed Common Stock held in
SuiteSpeed's treasury and each share of SuiteSpeed Common Stock owned by RMLX or
any of its Subsidiaries shall be canceled without any conversion thereof and no
payment or distribution shall be made with respect thereto; and
2.7.2.3 subject to the provisions of Sections 2.8 and 2.9,
each share of SuiteSpeed Common Stock issued and outstanding immediately prior
to the Effective Time (other than (i) shares canceled in accordance with Section
2.7.2.2 and (ii) Dissenting Shares) shall be converted into the right to receive
a number of validly issued, fully paid and nonassessable shares of RMLX Common
Stock equal to the Merger Conversion Number. As of the Effective Time and
subject to Section 2.9, each such share of SuiteSpeed Common Stock shall no
longer be outstanding and shall automatically be canceled, and each holder of a
certificate representing any such shares of SuiteSpeed Common Stock shall cease
to have any rights with respect thereto other than the right to receive (i)
shares of RMLX Common Stock to be issued in consideration therefor upon the
surrender of such certificate, (ii) any dividends and other distributions in
accordance with Section 2.11.2 and (iii) any cash, without interest, to be paid
in lieu of any fractional share of RMLX Common Stock in accordance with Section
2.10.
2.8 Adjustment of the Exchange Ratios. In the event that, prior to the
Effective Time, any stock split, combination, reclassification or stock dividend
with respect to the RMLX Common Stock, any change or conversion of RMLX Common
Stock into other securities or any other dividend or distribution with respect
to the RMLX Common Stock should occur or, if a record date with respect to any
of the foregoing should occur, appropriate and proportionate adjustments shall
be made to the Merger Conversion Number, and thereafter all references to the
Merger Conversion Number shall be deemed to be to such Merger Conversion Number
as so adjusted.
2.9 Dissenting Shares.
2.9.1 Notwithstanding any provision of this Agreement to the
contrary, shares of SuiteSpeed Common Stock that are outstanding immediately
prior to the Effective Time and which are held by stockholders who shall not
have voted in favor of the Merger (or consented thereto in writing pursuant to
Section 228 of the Statute) and who shall have demanded properly in writing
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appraisal for such shares in accordance with Section 262 of the Statute
(collectively, the "Dissenting Shares") shall not be converted into or represent
the right to receive the consideration set forth in Section 2.7.2. Such
stockholders shall be entitled to receive such consideration as is determined to
be due with respect to such Dissenting Shares in accordance with the provisions
of Section 262 of the Statute, except that all Dissenting Shares held by
stockholders who shall have failed to perfect or who effectively shall have
withdrawn or lost their rights to appraisal of such shares under Section 262 of
the Statute shall thereupon be deemed to have been converted into and to have
become exchangeable for, as of the Effective Time, the right to receive the
shares of RMLX Common Stock specified in Section 2.7.2, without any interest
thereon, upon surrender, in the manner provided in Section 2.11, of the
certificate or certificates that formerly evidenced such Dissenting Shares.
2.9.2 SuiteSpeed shall give RMLX (i) prompt notice in writing of any
demands for appraisal received by SuiteSpeed, withdrawals of such demands, and
any other related instruments served pursuant to the Statute and received by
SuiteSpeed and (ii) the opportunity to direct all negotiations and proceedings
with respect to demands for appraisal under the Statute. SuiteSpeed shall not,
except with the prior written consent of RMLX, make any payment with respect to
any demands for appraisal or offer to settle or settle any such demands.
2.10 No Fractional Shares. No certificates or scrip representing
fractional shares of RMLX Common Stock shall be issued upon the surrender for
exchange of Certificates and such fractional shares shall not entitle the record
or beneficial owner thereof to vote or to any other rights as a stockholder of
RMLX. In lieu of receiving any such fractional share (after taking into account
all Certificates delivered by a Stockholder), the Stockholder shall receive cash
(without interest) in an amount rounded to the nearest whole cent, determined by
multiplying (i) the Average Market Price on the date immediately preceding the
date on which the Effective Time shall occur (or, if no such price is available,
the last day on which such price is available prior to the Effective Time) by
(ii) the fractional share to which such holder would otherwise be entitled.
2.11 Exchange Procedures; Distributions with Respect to Unexchanged
Shares; Stock Transfer Books.
2.11.1 As of the Effective Time, RMLX shall deliver to its transfer
agent a letter providing the transfer agent with all information reasonably
required to enable the transfer agent, upon RMLX' receipt of the letters of
transmittal described below, to issue stock certificates to the former
stockholders of SuiteSpeed. RMLX shall be entitled to place such legends on such
certificates as RMLX shall determine to be appropriate.
2.11.2 As soon as practicable after the Effective Time, RMLX shall
send to each Person who was, at the Effective Time, a holder of record of shares
of SuiteSpeed Common Stock which were converted into the right to receive RMLX
Common Stock pursuant to Section 2.7.2, a letter of transmittal which (i) shall
specify that delivery shall be effected and risk of loss and title to such
holder's Certificates shall pass, only upon actual delivery thereof to RMLX or
its agent and (ii) shall contain instructions for use in effecting the surrender
of the Certificates. Upon surrender to RMLX or its agent of Certificates for
cancellation, together with such letter of transmittal duly executed and such
other documents as RMLX may reasonably require, such holder shall be entitled to
receive in exchange therefor (A) a certificate representing the number of whole
shares of RMLX Common Stock into which the SuiteSpeed Common Stock represented
by the surrendered Certificate shall have been converted at the Effective Time,
(B) cash in lieu of any fractional share of RMLX Common Stock in accordance with
Section 2.10 and (C) dividends and distributions, if any, that are payable in
accordance with Section 2.11.3, and the Certificates so surrendered shall then
be canceled. Subject to Sections 2.9, 2.10 and 2.11.3, until surrendered as
contemplated by this Section 2.11.2, each Certificate from and after the
Effective Time shall be deemed to represent only the right to receive, upon such
surrender, the number of shares of RMLX Common Stock into which such SuiteSpeed
Common Stock shall have been converted.
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2.11.3 No dividends or other distributions declared or made after
the Effective Time with respect to the RMLX Common Stock with a record date
after the Effective Time shall be paid to any holder entitled by reason of the
Merger to receive certificates representing RMLX Common Stock and no cash
payment in lieu of a fractional share of RMLX Common Stock shall be paid to any
such holder pursuant to Section 2.10 until such holder shall have surrendered
its Certificates pursuant to this Section 2.11. Subject to applicable law,
following surrender of any such Certificate, such holder shall be paid, in each
case, without interest, (i) the amount of any dividends or other distributions
theretofore paid with respect to the shares of RMLX Common Stock represented by
the certificate received by such holder and having a record date on or after the
Effective Time and a payment date prior to such surrender and (ii) at the
appropriate payment date or as promptly as practicable thereafter, the amount of
any dividends or other distributions payable with respect to such shares of RMLX
Common Stock and having a record date on or after the Effective Time but prior
to such surrender and a payment date on or after such surrender.
2.11.4 If any certificate representing shares of RMLX Common Stock
or any cash is to be issued or paid to any Person other than the registered
holder of the Certificate surrendered in exchange therefor, it shall be a
condition to such exchange that such surrendered Certificate shall be properly
endorsed and otherwise in proper form for transfer and such Person either (i)
shall pay to RMLX any transfer or other Taxes required as a result of the
issuance of such certificates of RMLX Common Stock and the distribution of such
cash payment to such Person or (ii) shall establish to the satisfaction of RMLX
that such Tax has been paid or is not applicable. RMLX shall be entitled to
deduct and withhold from the consideration otherwise payable pursuant to this
Agreement to any former holder of shares of SuiteSpeed Common Stock such amounts
as RMLX is required to deduct and withhold with respect to the making of such
payment under the Code, or any provision of state, local or foreign Tax law. To
the extent that amounts are so withheld by RMLX, such withheld amounts shall be
treated for all purposes of this Agreement as having been paid to the holder of
the shares of SuiteSpeed Common Stock in respect of which such deduction and
withholding was made by RMLX. All amounts in respect of Taxes received or
withheld by RMLX shall be disposed of by RMLX in accordance with the Code or
such state, local or foreign Tax law, as applicable.
2.11.5 If any Certificate shall have been lost, stolen or destroyed,
upon the making of an affidavit of that fact by the Person claiming such
Certificate to be lost, stolen or destroyed and subject to such other conditions
as the Board of Directors of RMLX may reasonably impose, RMLX shall cause its
transfer agent to issue in exchange for such lost, stolen or destroyed
Certificate the shares of RMLX Common Stock as determined under Section 2.7.2
and pay any cash, dividends or other distributions as determined in accordance
with Sections 2.10 and 2.11.3 in respect of such Certificate; provided, that
RMLX may, in its reasonable discretion and as a condition precedent to the
issuance thereof, require the owner of such lost, stolen or destroyed
Certificate to deliver a bond in such sum as it may reasonably require as
indemnity against any claim that may be made against RMLX or the Surviving
Corporation with respect to the Certificate alleged to have been lost, stolen or
destroyed.
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2.11.6 At the close of business on the day on which the Effective
Time occurs, SuiteSpeed's stock transfer books shall be closed and thereafter
there shall be no further registration of transfers of shares of SuiteSpeed
Common Stock on SuiteSpeed's records. From and after the Effective Time, the
holders of shares of SuiteSpeed Common Stock outstanding immediately prior to
the Effective Time shall cease to have any rights with respect to such shares
except as otherwise provided herein or by applicable law.
2.11.7 All shares of RMLX Common Stock issued pursuant to the Merger
shall be represented by a stock certificate which shall contain a legend stating
substantially as follows:
"THE SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR ANY STATE
SECURITIES LAW. SUCH SHARES MAY NOT BE SOLD, PLEDGED, DISPOSED OF OR
OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN OPINION
OF COUNSEL SATISFACTORY TO THE ISSUER THAT SUCH REGISTRATION IS NOT
REQUIRED."
2.12 Abandoned Property. None of RMLX, Subcorp or SuiteSpeed shall be
liable to any former holder of SuiteSpeed Common Stock for any shares of RMLX
Common Stock held (and any cash, dividends and distributions payable in respect
thereof) which are not claimed by such former holder on a timely basis and are
delivered to a public official under any applicable abandoned property, escheat
or similar law.
2.13 No Further Ownership Rights in SuiteSpeed Common Stock. All
certificates representing shares of RMLX Common Stock delivered upon the
surrender for exchange of any Certificate in accordance with the terms hereof,
as well as any cash paid pursuant to Section 2.10 or Section 2.11, shall be
deemed to have been delivered (and paid) in full satisfaction of all rights
pertaining to the SuiteSpeed Common Stock previously represented by such
Certificate.
2.14 Tax Consequences. It is intended that the Merger shall constitute a
"reorganization" within the meaning of Section 368(a) of the Code, and that this
Agreement shall constitute a "plan of reorganization" for the purposes of the
Code.
2.15 Treatment of Stock Options
2.15.1 Option Conversion. At the Effective Time, all SuiteSpeed
Options then outstanding under the 2004 Stock Option/ Stock Issuance Plan (the
"Option Plan"), whether vested or unvested, shall be assumed by RMLX in
accordance with this Section 2.15.1. Each SuiteSpeed Option so assumed by RMLX
at the Effective Time will continue to have, and be subject to, the same terms
and conditions set forth in the Option Plan immediately prior to the Effective
Time (including, without limitation, any repurchase rights), except that (i)
each SuiteSpeed Option will be exercisable (or will become exercisable in
accordance with its terms) for that number of whole shares of RMLX Common Stock
equal to the product of the number of shares of SuiteSpeed Common Stock that
were underlying such SuiteSpeed Option immediately prior to the Effective Time
multiplied by the Merger Conversion Number, rounded down to the nearest whole
number of shares of RMLX Common Stock, and (ii) the per share exercise price for
the shares of RMLX Common Stock issuable upon exercise of such assumed
SuiteSpeed Option will be equal to the quotient determined by dividing the
exercise price per share of SuiteSpeed Common Stock at which such SuiteSpeed
Option was exercisable immediately prior to the Effective Time by the Merger
Conversion Number, rounded down to the nearest whole cent; provided, however,
that in the case of any SuiteSpeed Option to which Section 422 of the Code
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applies, the option price, the number of shares purchasable pursuant to such
option and the terms and conditions of exercise of such option shall be
determined in accordance with Section 424(a) of the Code. In connection with the
assumption by RMLX of the SuiteSpeed Options pursuant to this Section 2.15.1,
SuiteSpeed shall be deemed to have assigned to RMLX, effective at the Effective
Time, SuiteSpeed's right, if any, to repurchase unvested shares of SuiteSpeed
Common Stock issuable upon the exercise of the SuiteSpeed Options or previously
issued upon the exercise of options granted under the Option Plan, in accordance
with the terms of the Option Plan and the related stock option agreements and
stock purchase agreements entered into under the Option Plan.
2.15.2 Procedures for Option Conversion. As soon as practicable
after the Effective Time, RMLX shall deliver to the participants in the Option
Plan appropriate notices setting forth such participants' rights pursuant
thereto, that RMLX has assumed all obligations of SuiteSpeed under the Option
Plan and that the grants pursuant to the Option Plan shall continue in effect on
the same terms and conditions (subject to the adjustments required by this
Section 2.15 after giving effect to the Merger). RMLX shall comply with the
terms of the Option Plan and the parties intend that, to the extent required by,
and subject to the provisions of, such Option Plan and Sections 422 and 424(a)
of the Code, that Options which qualified as incentive stock options prior to
the Effective Time will continue to qualify as incentive stock options after the
Effective Time, and this provision shall be interpreted consistent with that
intent. RMLX shall take all corporate action necessary to reserve for issuance a
sufficient number of shares of RMLX Common Stock for delivery upon exercise of
the SuiteSpeed Options assumed in accordance with this Section 2.15, and shall
promptly after closing file a registration statement with the SEC with respect
to such assumed Option Plan in accordance with the Securities Act.
2.15.3 Consent. SuiteSpeed has obtained on or prior to the date
hereof a consent (in form and substance reasonably satisfactory to RMLX) from
each holder of a SuiteSpeed Option to the amendment of such SuiteSpeed Option
pursuant to this Section 2.15 (unless such consent is not required under the
terms of the applicable agreement, instrument or plan).
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SUITESPEED
SuiteSpeed represents and warrants to RMLX and Subcorp as follows:
3.1 Organization.
3.1.1 SuiteSpeed is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware and has the power
and authority to own, lease and operate its properties and to conduct the
SuiteSpeed Business. SuiteSpeed is duly qualified to transact business as a
foreign corporation and is in good standing in each jurisdiction in which the
conduct of its business or the ownership, leasing or operation of its property
requires such qualification, except for failures to be so qualified or in good
standing which would not, singly or in the aggregate with all such other
failures, have a SuiteSpeed Material Adverse Effect. SuiteSpeed does not have
any liability or obligation relating to any failure in the past to qualify to do
business in any jurisdiction other than liabilities and obligations reflected in
SuiteSpeed's consolidated balance sheet as of March 31, 2005 (the "SuiteSpeed
Current Balance Sheet"), a copy of which is set forth in Section 3.25.1 of the
disclosure schedule delivered by SuiteSpeed to RMLX contemporaneously with the
execution of this Agreement (the "SuiteSpeed Disclosure Schedule"). SuiteSpeed
is not in violation of any of the provisions of its organizational documents.
True and complete copies of such organizational documents, as currently in
effect, have previously been delivered to RMLX's counsel.
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3.1.2 True and complete copies of SuiteSpeed's minute books
(covering all meetings of the board of directors, committees thereof and
shareholders of SuiteSpeed since January 1, 1999) and stock transfer records
(since inception) have been delivered to RMLX's counsel prior to the date
hereof.
3.1.3 Section 3.1.3 of the SuiteSpeed Disclosure Schedule lists each
stock purchase agreement, registration rights agreement, stockholders'
agreement, voting rights agreement, investor agreement and other agreement
entered into by SuiteSpeed in connection with the issuance of any shares of
SuiteSpeed Common Stock and, to SuiteSpeed's knowledge, all other agreements
among the shareholders of SuiteSpeed, in their capacities as such. True and
complete copies of each of the agreements listed in such Section 3.1.3 have been
delivered to RMLX's counsel prior to the date hereof.
3.2 Capitalization; Funded Debt.
3.2.1 Section 3.2.1 of the SuiteSpeed Disclosure Schedule sets forth
the number of shares of each class and series of capital stock of SuiteSpeed
which are authorized for issuance and, as of the date hereof, the number of such
shares that are outstanding. Such Section 3.2.1 also sets forth the names and
addresses of the record and, to the extent known by SuiteSpeed, beneficial
owners of such outstanding shares (showing, for each such owner, the number of
such shares owned of record and beneficially) as of the date hereof. All of such
outstanding shares are fully paid and non-assessable, have been validly issued
and were issued in compliance with all applicable laws and agreements to which
SuiteSpeed is or was a party. No outstanding shares of SuiteSpeed's capital
stock are, or have ever been, subject to preemptive rights or rights of first
refusal other than rights described in the agreements listed in Section 3.1.3 of
the SuiteSpeed Disclosure Schedule, which rights have been waived or satisfied
in all applicable instances.
3.2.2 Section 3.2.2 of the SuiteSpeed Disclosure Schedule lists, for
each person who owns any options or rights to purchase any shares of the capital
stock of SuiteSpeed, the class and series of shares issuable upon exercise of
such options or rights, the number of shares subject to such warrants, options
or rights, the grant date of such options or rights, the vesting date or dates
of such options or rights and the plans and agreement (true and complete copies
of which have been delivered to RMLX's counsel) pursuant to which such options
or rights have been granted. Except as set forth in Section 3.2.1 of the
SuiteSpeed Disclosure Schedule, SuiteSpeed does not have outstanding any
subscriptions, options, rights, convertible securities or other agreements or
commitments to issue, or contracts or any other agreements obligating SuiteSpeed
to issue, or to transfer from treasury, any shares of capital stock of any class
or kind, or securities convertible into such capital stock. Each option or right
granted by SuiteSpeed has been granted in accordance with all applicable laws
and regulations, including (with respect to the SuiteSpeed Options) Rule 701 of
the SEC and all applicable state securities laws.
3.2.3 Except for the FNB Notes and as set forth in Section 3.2.3 of
the SuiteSpeed Disclosure Schedule, SuiteSpeed has no term or funded debt, debt
to banks or debt to Affiliates (the "Debt"). Such Section 3.2.3 lists each loan
agreement, credit agreement, mortgage, indenture, promissory note, security
agreement or other agreement or instrument to which SuiteSpeed is a party
evidencing term or funded debt, debt to banks or debt to Affiliates, true and
complete copies of which (including, without limitation, all documentation
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relating to the FNB Notes) have been delivered to RMLX's counsel prior to the
date hereof. Except as set forth in such Section 3.2.3 of the SuiteSpeed
Disclosure Schedule, no event has occurred which (whether with or without
notice, lapse of time or the happening or occurrence of any other event) would
constitute a default by SuiteSpeed under any agreement or other instrument
relating to any funded debt, bank loan or debt to Affiliates listed in such
Section 3.2.3 of the SuiteSpeed Disclosure Schedule which has not been cured or
waived (true and complete copies of which waivers are set forth in such Section
3.2.3 of the SuiteSpeed Disclosure Schedule).
3.2.4 Except as set forth in Section 3.2.4 of the SuiteSpeed
Disclosure Schedule, SuiteSpeed has not guaranteed the obligations of any
third-party, including any joint venture, any officer, director or shareholder
of SuiteSpeed or any entity affiliated with any such officer, director or
shareholder.
3.2.5 There are no declared and unpaid dividends on any shares of
SuiteSpeed Common Stock.
3.3 Subsidiaries; Acquisitions; Dispositions; Jurisdictions.
3.3.1 SuiteSpeed does not directly or indirectly own or control, and
has never directly owned or controlled, any Subsidiary .
3.3.2 SuiteSpeed does not, directly or indirectly, (i) own of record
or beneficially (A) any shares of capital stock or securities convertible into
capital stock of any other corporation or (B) any equity interest in any
partnership, joint venture, limited liability company or other business
enterprise or (ii) own or control any other entity. Since January 1, 1999,
SuiteSpeed has not acquired the capital stock or assets of any business entity,
or invested in any partnership, limited partnership, limited liability company,
joint venture or other business entity.
3.3.3 There are no agreements between SuiteSpeed and any third-party
relating to the operation, governance, ownership or other material aspect of any
joint venture.
3.3.4 Except as set forth in Section 3.3.4 of the SuiteSpeed
Disclosure Schedule, SuiteSpeed has not, since its formation, purchased, sold or
otherwise disposed of any assets or entity otherwise than in the ordinary course
of business.
3.3.5 The SuiteSpeed Business is not conducted through any entity
other than SuiteSpeed.
3.4 Tax Jurisdictions. Section 3.4 of the SuiteSpeed Disclosure Schedule
lists each jurisdiction with respect to which SuiteSpeed is required to file Tax
Returns.
3.5 Other Business Names. Section 3.5 of the SuiteSpeed Disclosure
Schedule lists each business name or trade name used in connection with the
SuiteSpeed Business by SuiteSpeed or its predecessors or by any companies
acquired by or merged into such entities, and each jurisdiction in which any
such trade name is registered.
3.6 Owned Real Property. SuiteSpeed does not own any real property.
3.7 Leased Real Property.
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3.7.1 Section 3.7.1 of the SuiteSpeed Disclosure Schedule sets forth
all leases pursuant to which SuiteSpeed leases any real estate (the "SuiteSpeed
Real Property Leases"). True and complete copies of the SuiteSpeed Real Property
Leases have been delivered to counsel for RMLX prior to the date hereof.
3.7.2 SuiteSpeed is not in default in any material respect under the
SuiteSpeed Real Property Leases. SuiteSpeed is not aware of any facts that, with
notice and/or the passage of time, would constitute such a default. The
possession of the applicable real property by SuiteSpeed under the SuiteSpeed
Real Property Leases has not been disturbed and, to SuiteSpeed's knowledge, no
claim has been asserted against SuiteSpeed which is materially adverse to its
rights in such leasehold interests.
3.7.3 To SuiteSpeed's knowledge, the portions of the buildings
leased by SuiteSpeed pursuant to the SuiteSpeed Real Property Leases comply in
all material respects with all applicable statutes, ordinances, rules and
regulations relating to the construction of such buildings and their current
use. The roof, exterior walls, and all other structural components of the
portions of such buildings leased to SuiteSpeed are in good condition, ordinary
wear and tear excepted. SuiteSpeed has performed all periodic maintenance which
it has been required to perform under applicable lease provisions, and has not
deferred any such maintenance. The heating, air conditioning, plumbing, fire
sprinkler system, lighting and loading doors, if any, and electrical systems of
the portions of such buildings leased by SuiteSpeed are in good operating
condition, ordinary wear and tear excepted. SuiteSpeed has not sublet such
buildings or any part thereof.
3.7.4 SuiteSpeed, as a tenant, has never assigned a lease to a third
party.
3.7.5 Consummation of the Merger will not constitute an assignment,
sublease or default under the SuiteSpeed Real Property Leases or otherwise
require any consent under any of the SuiteSpeed Real Property Leases.
3.7.6 All of the SuiteSpeed Real Property Leases (i) are valid and
subsisting and in full force and effect with respect to SuiteSpeed and, to
SuiteSpeed's knowledge, with respect to any other party thereto and (ii) were
entered into as a result of bona fide arm's length negotiations with the other
party or parties thereto. SuiteSpeed has valid leasehold interests in all
properties leased thereunder free and clear of all Liens.
3.8 Tangible Personal Property.
3.8.1 Section 3.8.1 of the SuiteSpeed Disclosure Schedule identifies
all items of tangible personal property owned and used by SuiteSpeed in
connection with the SuiteSpeed Business on the date hereof which had a book
value of more than $1,000 as of the date of the SuiteSpeed Current Balance
Sheet, including machinery, motor vehicles, computer equipment, furniture,
fixtures and leasehold improvements.
3.8.2 Section 3.8.2 of the SuiteSpeed Disclosure Schedule contains a
true and complete list of all machinery, motor vehicles, computer equipment,
other equipment, furniture, fixtures, and all other tangible personal property
leased by SuiteSpeed for the SuiteSpeed Business on the date hereof pursuant to
leases which involve monthly payments of more than $500 on account of any such
lease. True and complete copies of all leases pursuant to which such items are
leased to SuiteSpeed have been furnished to RMLX's counsel prior to the date
hereof. SuiteSpeed is not in default in any material respect under any of such
leases and is not aware of any fact which, with notice and/or passage of time,
would constitute such a default. All of the leases so listed (i) are valid and
subsisting and in full force and effect with respect to SuiteSpeed, and, to
SuiteSpeed's knowledge, with respect to any other party thereto and (ii) were
entered into as a result of bona fide arm's length negotiations with the other
party or parties thereto. SuiteSpeed has valid leasehold interests in all
personal property leased thereunder free and clear of all Liens.
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3.8.3 All personal property owned by SuiteSpeed or leased and used
by SuiteSpeed in the SuiteSpeed Business is in good condition, normal wear and
tear excepted, and is in good operating order.
3.9 Proprietary Information. No third party has claimed that SuiteSpeed or
any officer, director, or other person engaged now or in the past five (5) years
by, or affiliated now or in the past five (5) years with, SuiteSpeed has (i)
violated or may be violating any of the terms or conditions of his or her
employment, non-competition or non-disclosure agreement with such third party,
(ii) disclosed or may be disclosing or utilized or may be utilizing any trade
secret or proprietary information or documentation of such third party or (iii)
interfered or may be interfering in the employment relationship between such
third party and any of its present or former employees. No third party has
requested information from SuiteSpeed which suggests that such a claim might be
contemplated. To SuiteSpeed's knowledge, no officer, director, or other person
engaged now or in the past five (5) years by, or affiliated now or in the past
five (5) years with, SuiteSpeed has employed or proposes to employ any trade
secret or any information or documentation proprietary to any former employer,
and, to SuiteSpeed's knowledge, no officer, director, or other person engaged
now or in the past five (5) years by, or affiliated now or in the past five (5)
years with, SuiteSpeed has violated any confidential relationship which such
person may have had with any third party, in connection with the development or
sale of any product, service or proposed product or service of SuiteSpeed. To
SuiteSpeed's knowledge, neither the consummation of the transactions
contemplated by this Agreement nor the carrying on of the SuiteSpeed Business as
officers, employees or agents by any officer, director or key employee of
SuiteSpeed, or the conduct or proposed conduct of the SuiteSpeed Business, will
conflict with or result in a breach of the terms, conditions or provisions of or
constitute a default under any contract, covenant or instrument under which any
such officer, director or key employee is obligated. For the past three years,
each employee and consultant of SuiteSpeed who has been afforded access to
proprietary information of SuiteSpeed has executed a confidentiality and
non-disclosure agreement. Section 3.9 of the SuiteSpeed Disclosure Schedule sets
forth copies of the template confidentiality and non-disclosure agreements that
SuiteSpeed has used in the SuiteSpeed Business over the past three years.
3.10 Intellectual Property.
3.10.1 For the purposes of this Agreement, the following terms shall
have the following definitions:
"SuiteSpeed Intellectual Property" means any Intellectual Property
that is owned by or licensed to SuiteSpeed.
"Intellectual Property" means any or all of the following and all
rights in, arising out of, or associated therewith: (i) all United States and
foreign patents and utility models and applications therefor and all reissues,
divisions, renewals, extensions, provisionals, continuations and
continuations-in-part thereof, and equivalent or similar rights anywhere in the
world in inventions and discoveries ("Patents"); (ii) all inventions (whether
patentable or not), invention disclosures, improvements, trade secrets,
proprietary information, know how, technology, technical data and customer
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lists, and all documentation embodying or evidencing any of the foregoing; (iii)
all copyrights, copyright registrations and applications therefor and all other
rights corresponding thereto throughout the world ("Copyrights"); (iv) all mask
works, mask work registrations and applications therefor, and any equivalent or
similar rights in semiconductor masks, layouts, architectures or topology
("Maskworks"); (v) all industrial designs and any registrations and applications
therefor throughout the world; (vi) all trade names, logos, common law
trademarks and service marks, trademark and service mark registrations and
applications therefor and all goodwill associated therewith throughout the world
("Trademarks"); (vii) all databases and database collections and all rights
therein throughout the world; (viii) all computer software including all source
code, object code, firmware, development code, files, records and data, and any
medium on which any of the foregoing is recorded; (ix) all World Wide Web
addresses, sites and domain names; and (x) any similar, corresponding or
equivalent rights to any of the foregoing anywhere in the world.
"Registered Intellectual Property" means all United States,
international and foreign: (i) Patents, including applications therefor; (ii)
registered Trademarks, applications to register Trademarks, including
intent-to-use applications, or other registrations or applications related to
Trademarks; (iii) Copyright registrations and applications to register
Copyrights; (iv) Maskwork registrations and applications to register Maskworks;
and (v) any other Intellectual Property owned by a Party hereto that is the
subject of an application, certificate, filing, registration or other document
issued by, filed with, or recorded by, any state, government or other public
legal authority at any time. 32. 3.10.2 Section 3.10.2 of the SuiteSpeed
Disclosure Schedule lists all Registered Intellectual Property, in whole or in
part owned by or filed in the name of SuiteSpeed ("SuiteSpeed Registered
Intellectual Property").
3.10.3 Each item of SuiteSpeed Intellectual Property owned by
SuiteSpeed, including all SuiteSpeed Registered Intellectual Property listed in
Section 3.10.2 of the SuiteSpeed Disclosure Schedule, is free and clear of all
Liens, other than end-user licenses granted by SuiteSpeed pursuant to a standard
form of end-user license, a true and complete copy of which, if applicable, is
set forth in Section 3.10.3 of the SuiteSpeed Disclosure Schedule.
3.10.4 SuiteSpeed owns exclusively, and has good title to, all
copyrighted works that are software products of SuiteSpeed or other works of
authorship that SuiteSpeed otherwise purports to own, except for any items
described in Section 3.10.4 of the SuiteSpeed Disclosure Schedule representing
material portions of freeware owned by third parties and except for immaterial
portions of freeware (which are not required to be disclosed in such Section
3.10.4).
3.10.5 Except as otherwise indicated in Section 3.10.5 of the
SuiteSpeed Disclosure Schedule and except for end-user licenses granted by
SuiteSpeed pursuant to its standard form of end-user license, if applicable,
SuiteSpeed has not transferred ownership of, or granted any license or right to
use, any Intellectual Property that is, or was, SuiteSpeed Intellectual Property
to any other person or knowingly permitted SuiteSpeed's rights in such
SuiteSpeed Intellectual Property to lapse or enter into the public domain.
3.10.6 Except as set forth in Section 3.10.6 of the SuiteSpeed
Disclosure Schedule, the SuiteSpeed Intellectual Property constitutes all the
Intellectual Property used in the conduct of the SuiteSpeed Business as
currently conducted including (i) the making, using, selling, marketing or
importing of any product or device, (ii) the practice of any process, (iii) the
offering or performance of any service, or (iv) the copying, display,
performance, distribution, creation of derivative works of, or the exploitation
of, any device or work.
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3.10.7 Section 3.10.7 of the SuiteSpeed Disclosure Schedule contains
a list of all contracts, licenses and agreements (other than off-the-shelf
end-user licenses available to the general public) pursuant to which any person,
including any Affiliate of SuiteSpeed (other than a Subsidiary of SuiteSpeed),
has licensed any Intellectual Property to SuiteSpeed. Copies of such documents
currently in effect have been provided to RMLX's counsel prior the date hereof.
3.10.8 The consummation of the transactions contemplated by this
Agreement will not cause or obligate SuiteSpeed (i) to grant to any third party
any rights or licenses with respect to any SuiteSpeed Intellectual Property or
(ii) to pay any royalties or other amounts in excess of those being paid by
SuiteSpeed prior to the date hereof.
3.10.9 Section 3.10.9 of the SuiteSpeed Disclosure Schedule contains
a list of all agreements, licenses and contracts pursuant to which SuiteSpeed
has agreed to indemnify, hold harmless, or otherwise agree to be liable for any
losses, costs or damages of a third party with respect to any Intellectual
Property or product or service of SuiteSpeed. True and complete copies of all
such agreements, licenses and contracts have been provided to RMLX's counsel
prior to the date hereof.
3.10.10 All material SuiteSpeed Intellectual Property, including any
item thereof, is fully transferable, alienable or licensable by SuiteSpeed
without restriction and without payment of any kind to any third party.
3.10.11 The consummation of the transactions contemplated by this
Agreement will not result in the loss of, or otherwise adversely affect, any
ownership rights of SuiteSpeed in any SuiteSpeed Intellectual Property or result
in the breach or termination of any license, contract or agreement to which
SuiteSpeed is a party respecting any material SuiteSpeed Intellectual Property.
3.10.12 Except as set forth in Section 3.10.12 of the SuiteSpeed
Disclosure Schedule, to the knowledge of SuiteSpeed, the operation of the
SuiteSpeed Business, including (i) the making, using, selling, marketing or
importing of any product or device, (ii) the practice of any process, (iii) the
offering or performance of any service, or (iv) the copying, display,
performance, distribution, creation of derivative works of, or the exploitation
of any device or work does not infringe or misappropriate the Intellectual
Property of any Person, violate the rights of any Person, or constitute unfair
competition or unfair trade practices under the laws of any jurisdiction, and
SuiteSpeed has not received written notice from any Person claiming that such
operation or any act, product, technology or service of the SuiteSpeed Business
infringes or misappropriates the Intellectual Property of any Person or
constitutes unfair competition or unfair trade practices under the laws of any
jurisdiction. To SuiteSpeed's knowledge, (i) the making, using, selling,
marketing or importing of any product or device currently under development by
SuiteSpeed, (ii) the practice of any process currently under development by
SuiteSpeed, (iii) the offering or performance of any service currently under
development by SuiteSpeed, or (iv) the copying, display, performance,
distribution, creation of derivative works of, or the exploitation of any device
or work currently under development by SuiteSpeed, does not infringe or
misappropriate the Intellectual Property of any person, violate the rights of
any Person, or constitute unfair competition or unfair trade practices under the
laws of any jurisdiction, and SuiteSpeed has not received written notice from
any Person claiming that such operation or any such act, product, technology or
service misappropriates the Intellectual Property of any Person or constitutes
unfair competition or unfair trade practices under the laws of any jurisdiction.
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3.10.13 There are no contracts, licenses or agreements between
SuiteSpeed and any other Person with respect to SuiteSpeed Intellectual Property
under which there is any litigation or other legal proceeding known to
SuiteSpeed regarding the scope of such agreement or performance under such
contract, license or agreement including with respect to any payments to be made
or received by SuiteSpeed thereunder.
3.10.14 o the knowledge of SuiteSpeed, no Person has infringed or
misappropriated, or is infringing or misappropriating, any SuiteSpeed
Intellectual Property owned by SuiteSpeed.
3.10.15 Each material item of SuiteSpeed Registered Intellectual
Property is valid and subsisting, all necessary registration, maintenance and
renewal fees currently due in connection with such SuiteSpeed Registered
Intellectual Property have been made and all necessary documents, recordations
and certificates in connection with such SuiteSpeed Registered Intellectual
Property have been filed with the relevant patent, copyright, trademark or other
authorities in the United States or foreign jurisdictions, as the case may be,
for the purposes of maintaining such SuiteSpeed Registered Intellectual
Property.
3.10.16 SuiteSpeed has not claimed small business status, or other
particular status in the application for any SuiteSpeed Registered Intellectual
Property which claim of status was false at the time made or which has since
become inaccurate or false or that will no longer be true and accurate as a
result of the consummation of the Merger.
3.10.17 Except for those items owned by third parties and material
portions of freeware set forth in Section 3.10.4 of the SuiteSpeed Disclosure
Schedule (and excluding immaterial portions of freeware), all software products
of SuiteSpeed were written and created solely by either (i) employees of
SuiteSpeed acting within the scope of their employment, or (ii) by third parties
who, in the case of clauses (i) and (ii), have validly assigned all of their
rights, including Intellectual Property rights, in such products to SuiteSpeed,
and no third party owns any Intellectual Property rights to such software
products.
3.10.18 SuiteSpeed has not misrepresented or failed to disclose, and
is not aware of any misrepresentation or failure to disclose, any facts or
circumstances in any application for any SuiteSpeed Registered Intellectual
Property that would constitute fraud or a material misrepresentation with
respect to such application or that would otherwise affect the validity or
enforceability of any SuiteSpeed Registered Intellectual Property.
3.10.19 SuiteSpeed has taken all steps reasonable and customary
under the circumstances to protect the confidentiality and trade secret status
of any material confidential information of SuiteSpeed, and SuiteSpeed knows of
no instance in which a third party has had access to the material confidential
information of SuiteSpeed for which it could be claimed that SuiteSpeed has
failed to protect the confidentiality of any material confidential information
of SuiteSpeed.
3.10.20 All employees of, and consultants to, SuiteSpeed who have
contributed to the development of the SuiteSpeed Intellectual Property owned by
SuiteSpeed have entered into valid and binding agreements with SuiteSpeed
sufficient to vest title in SuiteSpeed to all Intellectual Property created by
such employees or consultants in the scope of his or her employment or
consultancy with SuiteSpeed. Section 3.10.20 of the SuiteSpeed Disclosure
Schedule sets forth copies of the template proprietary rights agreements that
SuiteSpeed has used in the SuiteSpeed Business over the past three years.
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3.11 Computer Programs. Section 3.11 of the SuiteSpeed Disclosure Schedule
contains a list of all of the computer programs (other than off-the-shelf
programs) used by SuiteSpeed in the SuiteSpeed Business, indicating which are
owned by SuiteSpeed and which are used by SuiteSpeed pursuant to a license from
others, in each case identifying the licensor and the date of the license
agreement. A true and complete copy of each such license agreement has been
delivered to RMLX's counsel prior to the date hereof.
3.12 Accounts Receivable.
3.12.1 Except as set forth in Section 3.12 of the SuiteSpeed
Disclosure Schedule, all of SuiteSpeed's accounts receivable set forth on the
SuiteSpeed Current Balance Sheet or arising subsequent to the date of the
SuiteSpeed Current Balance Sheet have originated in the ordinary course of
business of SuiteSpeed.
3.12.2 SuiteSpeed has delivered to RMLX prior to the date hereof a
schedule setting forth a true and complete aging of its consolidated accounts
receivable as of May 31, 2005.
3.13 Title to Assets. SuiteSpeed has good and marketable title in and to
all of the assets and property of the SuiteSpeed Business reflected in the
SuiteSpeed Current Balance Sheet plus all assets and property purchased by
SuiteSpeed since the date of the SuiteSpeed Current Balance Sheet, less all
assets and property which SuiteSpeed has disposed of in the ordinary course of
business since the date of the SuiteSpeed Current Balance Sheet. The only Liens
which exist and, at the Closing, will exist on the assets and property of the
Surviving Corporation at the Effective Time are Liens which either (a) secure
liabilities disclosed in the SuiteSpeed Current Balance Sheet, (b) secure the
ownership interests of lessors of equipment used in the SuiteSpeed Business and
disclosed on other exhibits annexed hereto, (c) are Liens for current taxes or
assessments or governmental charges not yet due or (d) are disclosed on Section
3.13 of the SuiteSpeed Disclosure Schedule annexed hereto.
3.14 Material Contracts.
3.14.1 Section 3.14.1 of the SuiteSpeed Disclosure Schedule
identifies the following contracts, leases and other obligations to which
SuiteSpeed is a party or by which SuiteSpeed is bound: (a) contracts with or
loans to any of the stockholders, equity holders, officers, directors, agents,
consultants, advisors, salesmen, distributors or sales representatives of
SuiteSpeed; (b) agreements under which SuiteSpeed has granted any Person any
indemnification or registration rights; (c) agency agreements given by or to
SuiteSpeed; (d) unsecured loans and lines of credit; (e) contracts restricting
SuiteSpeed or, to SuiteSpeed's knowledge, any of the employees or affiliates of
SuiteSpeed from doing business in any areas or in any way limiting competition;
(f) contracts and leases which will not be terminable without cost or liability
within 60 days after the Closing Date; (g) contracts providing for the
installation or maintenance of equipment purchased or leased by SuiteSpeed and
requiring payment by SuiteSpeed of more than $500 per month; (h) written
employment agreements with any of SuiteSpeed's employees; (i) contracts
obligating SuiteSpeed to provide maintenance in the future; (j) any other
contract which is reasonably likely to have a material impact on the business,
operations, assets, prospects or financial condition of SuiteSpeed; (k)
guarantees by SuiteSpeed of the obligations of any other party except those
resulting from the endorsement of customer checks; (l) contracts affecting the
transfer or voting of any securities of SuiteSpeed; (m) any other agreement
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entered into by SuiteSpeed outside the ordinary course of business; and (n) all
commitments to enter into any such contracts, leases or obligations described in
clauses (a) through (m) above. Except as disclosed in such Section 3.14.1,
SuiteSpeed has performed all material obligations required on its part to be
performed under each of such contracts, obligations and commitments to which
SuiteSpeed is a party or otherwise bound and no default has occurred thereunder
on the part of SuiteSpeed (other than defaults which have been waived pursuant
to waivers copies of which are set forth in Section 3.14.1 of the SuiteSpeed
Disclosure Schedule) which are reasonably likely to have a SuiteSpeed Material
Adverse Effect. All parties to such contracts, obligations or commitments with
SuiteSpeed are, to SuiteSpeed's knowledge, in substantial compliance therewith
and, to SuiteSpeed's knowledge, no event has occurred which, through the giving
of notice or the passage of time or both, would cause or constitute a material
default under any such contracts, obligations or commitments or would cause the
acceleration of any obligation of any party thereto.
3.14.2 Except as set forth in Section 3.14.2 of the SuiteSpeed
Disclosure Schedule, SuiteSpeed does not have any outstanding loans or advances
to any Person and is not obligated to make any such loans or advances, except
for advances to employees in respect of reimbursable business expenses
anticipated to be incurred by them in connection with their performance of
services.
3.14.3 Copies of the contracts listed or referred to in Section
3.14.1 have been delivered to RMLX's counsel prior to the date hereof.
3.15. Customers and Suppliers. 56.
3.15.1 Section 3.15.1 of the SuiteSpeed Disclosure Schedule lists
the top twenty (20) customers, or groups of related customers, of the SuiteSpeed
Business (based on the aggregate revenues paid by such customers, or groups of
related customers, to SuiteSpeed during the 12 months ended May 31, 2005), the
aggregate revenues paid by such customers to SuiteSpeed during such period and
the general nature of the products sold and/or services provided to such
customers. Except as set forth in Section 3.15.1 of the SuiteSpeed Disclosure
Schedule, SuiteSpeed does not have any contracts with the customers listed in
Section 3.15.1 other than purchase orders entered into in the ordinary course of
business. Correct copies of the contracts with customers referred to in Section
3.15.1 of the SuiteSpeed Disclosure Schedule have been delivered to RMLX's
counsel prior to the date hereof.
3.15.2 Section 3.15.2 of the SuiteSpeed Disclosure Schedule lists
the top ten (10) suppliers to the SuiteSpeed Business (based on the aggregate
amounts paid by SuiteSpeed to such suppliers during the 12 months ended May 31,
2005). Except as set forth in Sections 3.14.1 and 3.15.2 of the SuiteSpeed
Disclosure Schedule, SuiteSpeed does not have any contracts with the suppliers
listed therein other than purchase orders entered into in the ordinary course of
business. Copies of the contracts with suppliers referred to in such Section
3.15.2 of the SuiteSpeed Disclosure Schedule have been delivered to RMLX's
counsel prior to the date hereof.
3.15.3 To SuiteSpeed's knowledge, none of the customers listed in
Section 3.15.1 of the SuiteSpeed Disclosure Schedule and none of the suppliers
listed in Section 3.15.2 of the SuiteSpeed Disclosure Schedule intends to
terminate or materially change its relationship with SuiteSpeed prior to, on or
after the Closing Date, except (x) as disclosed in either or both of such
sections of the SuiteSpeed Disclosure Schedule or (y) as otherwise specifically
contemplated by the contracts between SuiteSpeed and such customers or
suppliers.
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3.16 Transactions with Related Parties. Except as set forth in Section
3.16 of the SuiteSpeed Disclosure Schedule, since January 1, 2004, SuiteSpeed
has not engaged in any transaction with an officer, director or shareholder of
SuiteSpeed of the type which would be required to be disclosed pursuant to Item
404 of Rule S-K of the SEC if SuiteSpeed were subject to such Item. With respect
to each transaction listed in Section 3.16 of the SuiteSpeed Disclosure
Schedule, except as otherwise disclosed in such Schedule, such transaction has
been on terms no less favorable to SuiteSpeed than those which could have been
obtained at the time from bona fide third parties.
3.17 Labor Matters.
3.17.1 SuiteSpeed is not a party to any collective bargaining
agreements.
3.17.2 SuiteSpeed has not had any strike, slowdown, picketing, work
stoppage, labor dispute or threat of a labor dispute or any attempt or threat of
an attempt by a labor union to organize its employees.
3.17.3 Section 3.17.3 of the SuiteSpeed Disclosure Schedule contains
a list of all current employment or consulting contracts with, and covenants
against competition by, any person employed by SuiteSpeed. Correct copies of all
such agreements have been delivered to RMLX's counsel prior to the date hereof.
3.17.4 Except as set forth in Section 3.17.4 of the SuiteSpeed
Disclosure Schedule, all employees of SuiteSpeed are employees at will who,
subject to applicable laws, may be terminated by SuiteSpeed at any time with no
obligation to make any payment except wages to the date of termination, accrued
vacation and sick leave benefits.
3.17.5 SuiteSpeed is in compliance in all material respects with all
laws respecting employment, wages and hours. SuiteSpeed is not engaged in any
discriminatory hiring or employment practices or any unfair labor practices. No
employment discrimination or unfair labor practice complaint has been filed
against SuiteSpeed, or, to SuiteSpeed's knowledge, threatened to be filed
against SuiteSpeed, with any governmental authority having jurisdiction over the
labor matters of SuiteSpeed. Since January 1, 2004, SuiteSpeed has not been
threatened by any former employee with any suit alleging wrongful termination.
3.18 Benefit Plans; ERISA.
3.18.1 Section 3.18.1 of the SuiteSpeed Disclosure Schedule contains
a true and complete list of all funded or unfunded, written or oral, employee
benefit plans, contracts, agreements, incentives, or salary, wage or other
compensation plans or arrangements, including all pension and profit sharing
plans, savings plans, bonus plans, deferred compensation plans, incentive
compensation plans, stock purchase plans, supplemental retirement plans,
severance plans, termination pay plans, stock option plans, hospitalization
plans, medical insurance plans, life insurance plans, dental insurance plans,
disability insurance plans, salary continuation plans, vacation plans,
supplemental unemployment benefit plans, retiree benefit plans and, in each such
case, comparable agreements, and each other employee benefit program, plan,
policy or arrangement (each a "Benefit Plan") maintained, contributed to, or
required to be contributed to, by SuiteSpeed for the benefit of the former or
current employees, directors, agents or consultants of SuiteSpeed, whether or
not subject to the Employee Retirement Income Security Act of 1974 ("ERISA").
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3.18.2 SuiteSpeed has delivered to RMLX's counsel prior to the date
hereof true and complete copies of the Benefit Plans and all related trust
documents and other related agreements. Each of the Benefit Plans listed in
Section 3.18.1 of the SuiteSpeed Disclosure Schedule is and has at all times
been in compliance in all material respects with all provisions of law
applicable to such plans. No event has occurred, is threatened or is about to
occur which would constitute a reportable event (for which the notice
requirement has not been waived) within the meaning of ss.4043(b) of ERISA with
respect to any "employee pension benefit plan" (as defined in ss.3(2) of ERISA)
of the SuiteSpeed Business (each a "Pension Plan") if such plan were subject to
ERISA.
3.18.3 Each of the Benefit Plans which is required to meet the
requirements of Section 401(a) of the Code now meets, and since its inception
has met, the requirements for qualification under Section 401(a) of the Code.
3.18.4 To SuiteSpeed's knowledge, each fiduciary and every plan
official of each Benefit Plan is bonded to the extent required by applicable
law. No steps have been taken to terminate any Benefit Plan and no liability has
been incurred by SuiteSpeed with respect to the Benefit Plans that has not been
satisfied in full; to SuiteSpeed's knowledge no condition exists that could
reasonably be expected to result in SuiteSpeed's incurring a material liability
under applicable law with respect to the Benefit Plans other than the payment of
benefits in accordance with the terms of such Benefit Plans, and no proceeding
has been initiated to terminate, or to appoint a trustee to administer, any
Pension Plan. SuiteSpeed has not withdrawn from any Pension Plan or ceased
operations at any facility. In the event that any Benefit Plan was required to
file annual reports with any governmental authority, those sections of any such
annual reports heretofore filed with any governmental authority by or on behalf
of such Benefit Plan which were required to be certified were certified without
qualification by the accountants or actuaries of such Benefit Plan. By their
terms, each of the Benefit Plans can be amended, terminated or otherwise
discontinued after the Closing Date without liability to SuiteSpeed.
3.18.5 Except as specifically set forth in Section 3.18.5 of the
SuiteSpeed Disclosure Schedule, the execution and performance of the
transactions contemplated by this Agreement will not constitute an event under
any Benefit Plan or individual agreement relating thereto that will or may
reasonably be expected to result in any material payment (whether of severance
pay or otherwise), acceleration, vesting or increase in benefits with respect to
any current or former employee, consultant, agent or director of SuiteSpeed.
3.18.6 Except as set forth in Section 3.18.6 of the SuiteSpeed
Disclosure Schedule, no Benefit Plan is (a) a multiemployer plan as defined in
Section 3(37) of ERISA, (b) a defined benefit plan as defined in Section 3(35)
of ERISA or (c) subject to the funding standards of Section 412 of the Code.
3.18.7 SuiteSpeed has made all contributions required to be made to
each Benefit Plan under the terms of such plan and applicable law.
3.18.8 No transaction prohibited by any applicable law has occurred
with respect to any Benefit Plan listed in Section 3.18.1 of the SuiteSpeed
Disclosure Schedule which could subject any Benefit Plan or any related trust,
SuiteSpeed or any affiliate of SuiteSpeed, or any director or employee of
SuiteSpeed, to any material tax or penalty imposed by any applicable law, either
directly or indirectly, and whether by way of indemnity or otherwise.
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3.18.9 SuiteSpeed or the applicable plan administrator has timely
filed all required reporting and disclosure forms for each Benefit Plan with the
appropriate governmental authorities.
3.18.10 Each group health plan (as defined in Section 5000(b)(1) of
the Code) maintained by SuiteSpeed has been administered in compliance in all
material respects with all applicable laws. SuiteSpeed does not now and has
never maintained, sponsored or contributed to any plan or program or arrangement
providing post-termination employment, health, dental, disability or life
insurance benefits with respect to employees or former employees and their
spouses and dependents other than COBRA continuation coverage pursuant to
Sections 601 through 609 of ERISA.
3.19 Insurance. Section 3.19 of the SuiteSpeed Disclosure Schedule lists
all insurance policies which SuiteSpeed currently has in effect and which
SuiteSpeed had in effect at any time since January 1, 2002 and the status of any
claims made thereunder. Except as otherwise noted in Section 3.19 of the
SuiteSpeed Disclosure Schedule, all such insurance policies provide occurrence
coverage. True and complete copies of said policies, including all endorsements,
have been delivered to RMLX's counsel prior to the date hereof. All premiums due
and payable under all such policies have been paid, and SuiteSpeed is otherwise
in compliance in all material respects with the terms and conditions of all such
policies. The reserves established by SuiteSpeed in respect of all matters as to
which SuiteSpeed self-insures or carries retentions and/or deductibles,
including product and intellectual property infringement liability, workers'
medical coverage and workers' compensation, are adequate and appropriate in
light of SuiteSpeed's experience, and SuiteSpeed is not aware of any facts or
circumstances existing as of the date hereof that would reasonably be expected
to cause such reserves to be inadequate or inappropriate. SuiteSpeed has not
been subject to any product liability claim or any claim asserting that services
provided by SuiteSpeed have been provided negligently, other than claims
described in Section 3.19 of the SuiteSpeed Disclosure Schedule.
3.20 Licenses and Permits. Except as set forth in Section 3.20 of the
SuiteSpeed Disclosure Schedule, SuiteSpeed and its employees have all licenses,
permits, orders, approvals and authorizations required for the conduct of the
SuiteSpeed Business as presently conducted and as contemplated to be conducted,
other than licenses, permits, orders, approvals and authorizations which, if not
obtained by SuiteSpeed, would not have a SuiteSpeed Material Adverse Effect. A
list of all of SuiteSpeed's material licenses, permits, orders, approvals and
authorizations is set forth in Section 3.20 of the SuiteSpeed Disclosure
Schedule. In all material respects, SuiteSpeed is acting within the terms of
such licenses, permits, orders, approvals and authorizations. Since January 1,
2002, SuiteSpeed has not received any notice of investigation, evaluation or
suspension of any such licenses, permits, orders, approvals or authorizations.
To SuiteSpeed's knowledge, no suspension or cancellation of any such licenses,
permits, orders, approvals or authorizations has been threatened or is
contemplated.
3.21 Authority Relative to this Agreement; Enforceability. Subject to the
receipt of any governmental approvals, the execution, delivery and performance
of this Agreement are within the corporate power and authority of SuiteSpeed and
have been duly authorized by all requisite corporate action on the part of
SuiteSpeed. This Agreement is a legal, valid and binding obligation of
SuiteSpeed, enforceable against SuiteSpeed in accordance with its terms, except
insofar as its enforcement may be limited by (a) bankruptcy, insolvency,
moratorium or similar laws affecting the enforcement of creditors' rights
generally and (b) equitable principles limiting the availability of equitable
remedies. All persons who executed this Agreement on behalf of SuiteSpeed have
been duly authorized to do so.
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3.22 Compliance with Other Instruments; Consents. Except as set forth in
Section 3.22 of the SuiteSpeed Disclosure Schedule, neither the execution and
delivery of this Agreement by SuiteSpeed nor the consummation of the
transactions contemplated hereby will:
3.22.1 conflict with, or result in a breach of any provision of,
SuiteSpeed's Certificate of Incorporation, by-laws or other organizational
documents;
3.22.2 violate, or conflict with, or result in a breach of any
provision of, or constitute a default (or an event which, with the giving of
notice, the passage of time or otherwise, would constitute a default) under, or
entitle any party (with the giving of notice, the passage of time or otherwise)
to terminate, accelerate, modify or call a default under, or result in the
creation of any Lien upon any of the properties or assets of SuiteSpeed under,
any of the terms, conditions or provisions of any note, bond, mortgage,
indenture, deed of trust, license, contract, undertaking, agreement, lease or
other instrument or obligation to which SuiteSpeed is a party;
3.22.3 violate any order, writ, injunction, decree, statute, rule or
regulation applicable to SuiteSpeed, its properties or its assets; or
3.22.4 require any action or consent or approval of, or review by,
or registration or filing by SuiteSpeed or any of its Affiliates with, any third
party or any governmental authority, other than (i) registrations or other
actions required under federal and state securities laws as are contemplated by
this Agreement, or (ii) the filing of the Certificate of Merger pursuant to the
Statute,
except, in the case of Sections 3.22.2, 3.22.3 and 3.22.4, for any of the
foregoing that, individually or in the aggregate, is not reasonably likely to
have a SuiteSpeed Material Adverse Effect.
3.23 Compliance with Applicable Laws. Except as set forth in Section 3.23
of the SuiteSpeed Disclosure Schedule, SuiteSpeed is in compliance in all
material respects with all Laws and, since January 1, 2003, SuiteSpeed has not
received any notice or advice to the contrary. All reports relating to
SuiteSpeed required to be filed since January 1, 2003 with any governmental
authority, including any governmental authority issuing licenses or
qualifications to acquire, import, export, manufacture, assemble or sell various
classes and types of products or services sold by SuiteSpeed, have been timely
filed and all information contained therein is true and correct in all material
respects.
3.24 Environmental Compliance
3.24.1 For purposes of this Agreement:
3.24.1.1 "Regulated Substance" means any pollutant, chemical
substance, hazardous waste, hazardous substance or contaminant regulated under
any Environmental Law.
3.24.1.2 "Enforcement Notice" means a summons, notice, notice
of violation, citation, directive, order, claim, litigation, investigation,
judgment, letter or other communication, written or oral, from any governmental
authority or other person or entity, concerning the Releasing of a Regulated
Substance into the air, water or land.
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3.24.1.3 "Releasing" means releasing, spilling, leaking,
pumping, pouring, emitting, emptying, discharging, injecting, escaping,
leaching, disposing or dumping.
3.24.1.4 "Environmental Law" means all applicable Laws
relating to pollution control and environmental contamination, including, but
not limited to, all Laws governing the generation, use, collection, treatment,
storage, transportation, recovery, removal, discharge, or disposal of Regulated
Substances and all laws and regulations with regard to record-keeping,
notification and reporting requirements respecting Regulated Substances.
3.24.2 SuiteSpeed is in compliance in all material respects with all
Environmental Laws. SuiteSpeed has not been alleged to be in violation of, nor
has SuiteSpeed been subject to any administrative or judicial proceeding
pursuant to, any Environmental Laws at any time during the past three years.
3.24.3 None of the real estate leased by SuiteSpeed has ever been
used by SuiteSpeed to generate, manufacture, refine, transport, treat, store,
handle, dispose, transfer or process Regulated Substances except in the ordinary
course of business in accordance with Environmental Laws.
3.24.4 There have been no Regulated Substances generated,
transported or disposed of by SuiteSpeed during the past three years except in
the ordinary course of business in accordance with Environmental Laws.
3.24.5 To SuiteSpeed's knowledge, there are no Enforcement Notices
in effect, and SuiteSpeed is not aware of any facts which might reasonably be
expected to result in the issuance of any Enforcement Notice with respect to
SuiteSpeed or, to SuiteSpeed's knowledge, any predecessor in use, occupancy,
interest or title to the real property owned or leased or the personal property
owned by SuiteSpeed.
3.24.6 To SuiteSpeed's knowledge, there are no underground storage
tanks on or in the portion of the real property leased by SuiteSpeed.
3.25 Financial Statements.
3.25.1 Attached to Section 3.25.1 of the SuiteSpeed Disclosure
Schedule are the following unaudited annual and interim consolidated financial
statements of SuiteSpeed: the unaudited consolidated balance sheets of
SuiteSpeed as of December 31, 2003 and 2004, the related unaudited consolidated
statements of income, changes in stockholders' equity and cash flows of
SuiteSpeed for the years ended December 31, 2002, 2003 and 2004, the SuiteSpeed
Current Balance Sheet and the unaudited consolidated statements of income and
cash flows of SuiteSpeed for the three months ended March 31, 2004 and 2005 (the
"SuiteSpeed Financial Statements"). The SuiteSpeed Financial Statements fairly
present in all material respects the financial condition of SuiteSpeed and the
results of SuiteSpeed's operations and cash flows as at the dates or for the
periods to which they apply, as the case may be, and such statements have been
prepared in conformity with GAAP applied on a consistent basis during the
periods involved.
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3.25.2 Except as listed in Section 3.25.2 of the SuiteSpeed
Disclosure Schedule, no value has been assigned in the SuiteSpeed Financial
Statements to (a) any trademarks, trade names, contract rights, patents,
copyrights, customer lists, books and records, restrictive covenants, deferred
charges, or prepaid expenses for any item other than taxes, rent, insurance or
other intangible item other than good will; (b) office supplies, advertising or
promotional material; (c) any asset previously charged to expense; or (d) any
other asset which it has been SuiteSpeed's practice to write off as an expense.
Section 3.25.2 of the SuiteSpeed Disclosure Schedule sets forth SuiteSpeed's
policy with respect to the capitalization and expensing of software, which
policy is in accordance with GAAP and has been adhered to in all material
respects by SuiteSpeed since its inception.
3.25.3 No unrecorded funds or assets of SuiteSpeed have been
established for any purpose; no accumulation or use of SuiteSpeed's funds has
been made without being properly accounted for in SuiteSpeed's books and
records; all payments by or on behalf of SuiteSpeed have been duly and properly
recorded and accounted for in its books and records; no false or artificial
entry has been made in SuiteSpeed's books and records for any reason; no payment
has been made by or on behalf of SuiteSpeed with the understanding that any part
of such payment is to be used for any purpose other than that described in the
documents supporting such payment; and SuiteSpeed has not made, directly or
indirectly, any illegal contributions to any political party or candidate,
either domestic or foreign, or any contribution, gift, bribe, rebate, payoff,
influence payment or kickback, whether in cash, property or services, to any
individual, corporation, partnership or other entity, to secure business or to
pay for business secured by SuiteSpeed.
3.25.4 Except as described in Section 3.25.4 of the Suite Speed
disclosure Schedule, since December 31, 2003, there have been no significant
changes in the internal controls utilized by SuiteSpeed and its Subsidiaries
with respect to their financial records (the "SuiteSpeed Internal Controls") or
in other factors that could significantly affect the SuiteSpeed Internal
Controls, including any corrective actions with regard to significant
deficiencies and material weaknesses. There are no significant deficiencies in
the design or operation of the SuiteSpeed Internal Controls which could
adversely affect the ability of SuiteSpeed to record, process, summarize and
report financial data and there are no material weaknesses in the SuiteSpeed
Internal Controls. SuiteSpeed is not aware of any fraud, whether or not
material, that involves management or other employees who have a significant
role in preparing SuiteSpeed's consolidated financial statements.
3.25.5 SuiteSpeed does not have any outstanding binding commitments
with respect to capital expenditures other than the commitments described in
Section 3.25.5 of the SuiteSpeed Disclosure Schedule.
3.25.6 Except as and to the extent reflected, disclosed or reserved
against in the SuiteSpeed Current Balance Sheet, as of the date thereof,
SuiteSpeed did not have any liabilities, whether absolute, accrued, contingent
or otherwise, material to the consolidated financial condition of SuiteSpeed
which were required to be so disclosed in the SuiteSpeed Current Balance Sheet
under GAAP. Since the date of the SuiteSpeed Current Balance Sheet, SuiteSpeed
has not incurred any liabilities except in the ordinary course of business
consistent with past practice, except as specifically contemplated by this
Agreement.
3.26 Taxes.
3.26.1 All of SuiteSpeed's Taxes have been paid in full to the
appropriate governmental authorities or fully accrued or provided for with
respect to fiscal periods covered by the SuiteSpeed Financial Statements, except
as described in Section 3.26.1 of the SuiteSpeed Disclosure Schedule. SuiteSpeed
has prepared and timely filed or will prepare and timely file with the
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appropriate governmental authorities all Tax Returns required to be filed by
SuiteSpeed at or before the Effective Time, taking into account any extension of
time to file granted to or obtained on behalf of SuiteSpeed (copies of which Tax
Returns for the past three fiscal years have been delivered or made available to
RMLX) and such Tax Returns were (or in the case of Tax Returns to be filed
subsequent to the date hereof, will be) correct and complete in all material
respects when filed.
3.26.2 Section 3.26.2 of the SuiteSpeed Disclosure Schedule sets
forth the extent to which, to SuiteSpeed's knowledge, SuiteSpeed's Tax Returns
have been examined, audited or investigated by any governmental authority and
the results of any such examination, audit or investigation. No assessments or
additional Taxes have been proposed or threatened against SuiteSpeed or any of
its assets pursuant to any such examination. SuiteSpeed has not waived any
statute of limitations in respect of Taxes or agreed to any extension of time
with respect to a Tax assessment or deficiency. No issue has been raised in any
such examination, audit or investigation which can reasonably be expected to
result in a deficiency in any years not covered by that examination, audit or
investigation. Adjustments, if any, to all such Tax Returns have been agreed
upon and paid by SuiteSpeed or are being contested as indicated in Section
3.26.2 of the SuiteSpeed Disclosure Schedule.
3.26.3 To the best of SuiteSpeed's knowledge, there are no pending
investigations of SuiteSpeed or its Tax Returns by any taxing authority, and
there are no Tax Liens on any of SuiteSpeed's assets.
3.26.4 Except as set forth in Section 3.26.4 of the SuiteSpeed
Disclosure Schedule, there are no elections which SuiteSpeed has made with
respect to the income Tax treatment of any items which cannot be revoked without
the consent of the applicable governmental authority.
3.26.5 SuiteSpeed is not now and has never been a "United States
real property holding corporation", as defined in Section 897(c)(2) of the Code
and Section 1.897-2(b) of the regulations promulgated by the Internal Revenue
Service.
3.26.6 Except as set forth in Section 3.26.6 of the SuiteSpeed
Disclosure Schedule, no sales, use, transfer or documentary Tax will be imposed
upon the Surviving Corporation or RMLX by virtue of any of the transactions
contemplated by this Agreement.
3.26.7 SuiteSpeed has filed all escheat returns that it is required
to file and such returns were, when filed, accurate in all material respects.
SuiteSpeed has no material escheat liabilities.
3.26.8 SuiteSpeed (i) has complied in all material respects with all
applicable laws, rules and regulations relating to the payment and withholding
of Taxes from the wages or salaries of employees and independent contractors,
(ii) has paid over to the proper governmental authorities all amounts required
to be so withheld and (iii) is not liable for any Taxes for failure to comply
with such laws, rules and regulations.
3.26.9 SuiteSpeed has not filed any consent under Section 341(f) of
the Code concerning collapsible corporations.
3.26.10 SuiteSpeed is not a party to any agreement that provides for
the payment of any amount that, if paid, would be nondeductible (in whole or in
part) pursuant to Section 280G of the Code in connection with the consummation
of the Merger or otherwise.
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3.26.11 SuiteSpeed is not now, and has never been, a member of any
group filing Tax Returns on an affiliated, combined, consolidated, unitary or
similar basis. SuiteSpeed is not a party to any Tax allocation or Tax sharing
agreement, nor does SuiteSpeed have any liability for any Taxes for any Person
or entity other than SuiteSpeed as a transferee or successor, by contract, or
otherwise.
3.27 Litigation. Except as set forth in Section 3.27 of the SuiteSpeed
Disclosure Schedule, there are no legal, administrative, arbitration or other
proceedings or claims pending or, to SuiteSpeed's knowledge, threatened, against
SuiteSpeed, nor is SuiteSpeed subject to any existing order or judgment other
than any orders and judgments which, individually or in the aggregate, are not
reasonably likely to have a SuiteSpeed Material Adverse Effect.
3.28 Adverse Business Changes. Except as set forth in Section 3.28 of the
SuiteSpeed Disclosure Schedule, since the date of the SuiteSpeed Current Balance
Sheet (the "SuiteSpeed Statement Date") there has not been:
3.28.1 Any material adverse change in the working capital, financial
condition, assets, liabilities (whether absolute, accrued, contingent or
otherwise), reserves, operating profits, or business of SuiteSpeed;
3.28.2 Any damage, destruction or loss to SuiteSpeed or its
properties (whether or not covered by insurance) materially and adversely
affecting SuiteSpeed;
3.28.3 Any disposition, mortgage, pledge, or subjection to any Lien,
claim, charge or option of any property or asset of SuiteSpeed, any commitment
made or liability incurred by SuiteSpeed, or any cancellation or compromise of
any debt or claim of SuiteSpeed, otherwise than in the ordinary course of
business;
3.28.4 Any dividend or distribution declared, set aside or paid in
respect of SuiteSpeed's capital stock or any repurchase by SuiteSpeed of shares
of its capital stock;
3.28.5 Any employment contract entered into by SuiteSpeed; or any
increase or decrease in the rates of compensation payable by SuiteSpeed to any
of its officers, directors, employees or agents over or under the rates in
effect during the 12 months ended on the SuiteSpeed Statement Date, other than
general increases made in accordance with past practices; or any declaration,
payment, commitment, or obligation of any kind for the payment by SuiteSpeed of
any bonus, other than bonuses paid in the ordinary course of business, or any
implementation, modification, amendment or termination of any retirement,
termination, severance or other benefits to officers, directors, employees or
agents of SuiteSpeed;
3.28.6 Any amendment, termination or threatened termination of any
material contract, agreement, insurance policy, plan, lease, or license to which
SuiteSpeed is a party or by which SuiteSpeed may be bound, otherwise than in the
ordinary course of business;
3.28.7 Any material change in SuiteSpeed's methods of doing
business;
3.28.8 Any distribution or disposition of assets other than in the
ordinary course of business;
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3.28.9 Any termination of any permit or license issued to SuiteSpeed
or to any of its employees or agents upon which a material portion of the
SuiteSpeed Business is dependent; or
3.28.10 To SuiteSpeed's knowledge, any statute, order, judgment,
writ, injunction, decree, permit, rule or regulation of any court or any
governmental or regulatory body adopted or entered or proposed to be adopted or
entered which is reasonably likely to have a SuiteSpeed Material Adverse Effect.
3.29 Brokerage. No broker or finder has rendered services to SuiteSpeed
or, to SuiteSpeed's knowledge, to any stockholder of SuiteSpeed in connection
with this Agreement or the transactions contemplated hereby. Section 3.29 of the
SuiteSpeed Disclosure Schedule identifies any agreement executed by SuiteSpeed
which will obligate SuiteSpeed or any of its successors or Affiliates to pay any
brokerage or finder's fee in the future with respect to any type of commercial,
corporate, financial, acquisition, banking, borrowing or other business
transaction.
3.30 SuiteSpeed Disclosure Schedule. All of the facts recited in the
SuiteSpeed Disclosure Schedule, except to the extent otherwise explicitly
qualified therein, shall be deemed to be representations of fact as though
recited in this Article III.
3.31 Full Disclosure. No representation or warranty made in this Article
III contains any untrue statement of a material fact or omits to state a
material fact necessary to make the statements contained herein not misleading.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF RMLX
For purposes of each of the representations in this Article IV other than
the representations in Sections 4.1, 4.2.1, 4.3, and 4.5, any reference to RMLX
shall constitute a reference to RMLX and each of its Subsidiaries. RMLX and
Subcorp represent and warrant to SuiteSpeed as follows:
4.1 Organization.
4.1.1 RMLX and each of its Subsidiaries is a corporation duly
organized, validly existing and in good standing under the laws of the State in
which it was organized and has the power and authority to own, lease and operate
its properties and to conduct its business as presently conducted (the "RMLX
Business"). RMLX and each of its Subsidiaries is duly qualified to transact
business as a foreign corporation and is in good standing in each jurisdiction
in which the conduct of its business or the ownership, leasing or operation of
its property requires such qualification, except for failures to be so qualified
or in good standing which would not, singly or in the aggregate with all such
other failures, have a RMLX Material Adverse Effect. Neither RMLX nor any of its
Subsidiaries has any liability or obligation relating to any failure in the past
to qualify to do business in any jurisdiction other than liabilities and
obligations reflected in RMLX's consolidated balance sheet as of March 31, 2005
(the "RMLX Current Balance Sheet"), a copy of which is set forth in Section
4.1.1 of the disclosure schedule delivered by RMLX to SuiteSpeed
contemporaneously with the execution of this Agreement (the "RMLX Disclosure
Schedule"). Neither RMLX nor any of its Subsidiaries is in violation of any of
the provisions of its organizational documents. True and complete copies of such
organizational documents, as currently in effect, have previously been delivered
to SuiteSpeed's counsel.
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4.1.2 Section 4.1.2 of the RMLX Disclosure Schedule lists each stock
purchase agreement, registration rights agreement, stockholders' agreement,
voting rights agreement, investor agreement and other agreement entered into by
RMLX in connection with the issuance of any shares of RMLX Common Stock. True
and complete copies of each of the agreements listed in such Section 4.1.2 are
publicly available on the website of the Securities and Exchange Commission .
4.2 Capitalization; Funded Debt.
4.2.1 As of the date hereof, the authorized capital stock of RMLX
consists solely of 245,000,000 shares of RMLX Common Stock and 5,000,000 shares
of preferred stock, par value $.20 per share (the "RMLX Preferred Stock"). As of
May 31, 2005, there were 104,441,799 shares of RMLX Common Stock and 720,000
shares of RMLX Preferred Stock outstanding, no shares of RMLX Common Stock were
held in RMLX's treasury and no shares of RMLX Preferred Stock were held in
RMLX's treasury. As of May 31, 2005, 7,680,000 shares of RMLX Common Stock were
reserved for issuance upon the exercise of outstanding stock options, 29,343,427
shares of RMLX Common Stock were reserved for issuance upon the exercise of
outstanding warrants and 14,666,666 shares of RMLX Common Stock were reserved
for issuance upon the conversion of the principal amount ($1,100,000) of
outstanding debentures. Such debentures bear interest at a rate of 11% per
annum; the interest obligation on these debentures may also be converted into
RMLX Common Stock at a similar conversion ratio. Each outstanding share of RMLX
Common Stock is, and all shares of RMLX Common Stock to be issued in connection
with the transactions contemplated hereby will be, duly authorized and validly
issued, fully paid and nonassessable, with no personal liability attaching to
the ownership thereof. As of the date hereof, except for (a) stock options
issuable pursuant to stock option plans adopted or assumed by RMLX, (b) options
and warrants to purchase RMLX Common Stock and debentures convertible into RMLX
Common Stock described in Sections 4.2.1 and 4.22 of the RMLX Disclosure
Schedule, (c) matters disclosed in RMLX's SEC Reports, (d) shares issuable
pursuant to other benefit plans adopted by RMLX and (e) shares issuable pursuant
to this Agreement, RMLX does not have, and is not bound by, any outstanding
subscriptions, options, warrants, calls, commitments or agreements of any
character calling for the purchase or issuance of any shares of RMLX Common
Stock or RMLX Preferred Stock or any other equity securities of RMLX or any
securities representing the right to purchase or otherwise receive any shares of
RMLX Common Stock or RMLX Preferred Stock.
4.2.2 Except as set forth in Section 4.2.2 of the RMLX Disclosure
Schedule, RMLX has no term or funded debt, debt to banks or debt to Affiliates
(the "RMLX Debt"). Such Section 4.2.2 lists each loan agreement, credit
agreement, mortgage, indenture, promissory note, security agreement or other
agreement or instrument to which RMLX is a party evidencing term or funded debt,
debt to banks or debt to Affiliates, true and complete copies of which have been
delivered to SuiteSpeed's counsel prior to the date hereof or are publicly
available on the website of the Securities and Exchange Commission. Except as
set forth in such Section 4.2.2 of the RMLX Disclosure Schedule, no event has
occurred which (whether with or without notice, lapse of time or the happening
or occurrence of any other event) would constitute a default by RMLX under any
agreement or other instrument relating to any funded debt, bank loan or debt to
Affiliates listed in such Section 4.2.2 of the RMLX Disclosure Schedule which
has not been cured or waived (true and complete copies of which waivers are set
forth in such Section 4.2.2 of the RMLX Disclosure Schedule).
4.2.3 Except as set forth in Section 4.2.3 of the RMLX Disclosure
Schedule, RMLX has not guaranteed the obligations of any third-party, including
any joint venture, any officer, director or shareholder of RMLX or any entity
affiliated with any such officer, director or shareholder.
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4.2.4 There are no declared and unpaid dividends on any shares of
RMLX's capital stock.
4.3 Subsidiaries; Acquisitions; Dispositions; Jurisdictions.
4.3.1 RMLX does not directly or indirectly own or control, and has
never directly owned or controlled, any Subsidiary other than the Subsidiaries
listed in Section 4.3.1 of the RMLX Disclosure Schedule.
4.3.2 Other than with respect to the Subsidiaries listed in Section
4.3.1 of the RMLX Disclosure Schedule, RMLX does not, directly or indirectly,
(i) own of record or beneficially (A) any shares of capital stock or securities
convertible into capital stock of any other corporation or (B) any equity
interest in any partnership, joint venture, limited liability company or other
business enterprise or (ii) own or control any other entity. Since January 1,
1999, RMLX has not acquired the capital stock or assets of any business entity,
or invested in any partnership, limited partnership, limited liability company,
joint venture or other business entity other than with respect to the
Subsidiaries listed in Section 4.3.1 of the SuiteSpeed Disclosure Schedule.
4.3.3 There are no agreements between RMLX and any third-party
relating to the operation, governance, ownership or other material aspect of any
joint venture.
4.3.4 Except as set forth in Section 4.3.4 of the RMLX Disclosure
Schedule, RMLX has not, since its formation, purchased, sold or otherwise
disposed of any assets or entity otherwise than in the ordinary course of
business.
4.4 Intellectual Property.
4.4.1 For the purposes of this Agreement, "RMLX Intellectual
Property" shall mean any Intellectual Property that is owned by or licensed to
RMLX.
4.4.2 Section 4.4.2 of the RMLX Disclosure Schedule lists all
Registered Intellectual Property, in whole or in part owned by or filed in the
name of RMLX ("RMLX Registered Intellectual Property").
4.4.3 Each item of RMLX Intellectual Property owned by RMLX,
including all RMLX Registered Intellectual Property listed in Section 4.4.2 of
the RMLX Disclosure Schedule, is free and clear of all Liens, other than
end-user licenses granted by RMLX pursuant to a standard form of end-user
license, a true and complete copy of which, if applicable, is set forth in
Section 4.4.3 of the RMLX Disclosure Schedule.
4.4.4 RMLX owns exclusively, and has good title to, all copyrighted
works that are software products of RMLX or other works of authorship that RMLX
otherwise purports to own, except for immaterial portions of freeware.
4.4.5 Except for end-user licenses granted by RMLX pursuant to its
standard form of end-user license, if applicable, RMLX has not transferred
ownership of, or granted any license or right to use, any Intellectual Property
that is, or was, RMLX Intellectual Property to any other person or knowingly
permitted RMLX's rights in such RMLX Intellectual Property to lapse or enter
into the public domain.
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4.4.6 The RMLX Intellectual Property constitutes all the
Intellectual Property used in the conduct of the RMLX Business as currently
conducted including (i) the making, using, selling, marketing or importing of
any product or device, (ii) the practice of any process, (iii) the offering or
performance of any service, or (iv) the copying, display, performance,
distribution, creation of derivative works of, or the exploitation of, any
device or work.
4.4.7 There are no contracts, licenses or agreements (other than
object code end-user licenses available to the general public) pursuant to which
any person, including any Affiliate of RMLX (other than a Subsidiary of RMLX),
has licensed any Intellectual Property to RMLX.
4.4.8 There are no contracts, licenses or agreements pursuant to
which RMLX has licensed or transferred to any third person or any Affiliate of
RMLX any material RMLX Intellectual Property (other than end-user licenses
granted by RMLX pursuant to its standard form of end-user license).
4.4.9 The consummation of the transactions contemplated by this
Agreement will not cause or obligate RMLX (i) to grant to any third party any
rights or licenses with respect to any RMLX Intellectual Property or (ii) to pay
any royalties or other amounts in excess of those being paid by RMLX prior to
the date hereof.
4.4.10 There are no agreements, licenses or contracts pursuant to
which RMLX has agreed to indemnify, hold harmless, or otherwise agree to be
liable for any losses, costs or damages of a third party with respect to any
Intellectual Property or product or service of RMLX.
4.4.11 All material RMLX Intellectual Property, including any item
thereof, is fully transferable, alienable or licensable by RMLX without
restriction and without payment of any kind to any third party.
4.4.12 The consummation of the transactions contemplated by this
Agreement will not result in the loss of, or otherwise adversely affect, any
ownership rights of RMLX in any RMLX Intellectual Property or result in the
breach or termination of any license, contract or agreement to which RMLX is a
party respecting any material RMLX Intellectual Property.
4.4.13 To the knowledge of RMLX, the operation of the RMLX Business,
including (i) the making, using, selling, marketing or importing of any product
or device, (ii) the practice of any process, (iii) the offering or performance
of any service, or (iv) the copying, display, performance, distribution,
creation of derivative works of, or the exploitation of any device or work does
not infringe or misappropriate the Intellectual Property of any Person, violate
the rights of any Person, or constitute unfair competition or trade practices
under the laws of any jurisdiction, and RMLX has not received written notice
from any Person claiming that such operation or any act, product, technology or
service of the RMLX Business infringes or misappropriates the Intellectual
Property of any Person or constitutes unfair competition or trade practices
under the laws of any jurisdiction. To RMLX's knowledge, (i) the making, using,
selling, marketing or importing of any product or device currently under
development by RMLX, (ii) the practice of any process currently under
development by RMLX, (iii) the offering or performance of any service currently
under development by RMLX, or (iv) the copying, display, performance,
distribution, creation of derivative works of, or the exploitation of any device
or work currently under development by RMLX, does not infringe or misappropriate
the Intellectual Property of any person, violate the rights of any Person, or
constitute unfair competition or trade practices under the laws of any
jurisdiction, and RMLX has not received written notice from any Person claiming
that such operation or any act, product, technology or service misappropriates
the Intellectual Property of any Person or constitutes unfair competition or
trade practices under the laws of any jurisdiction.
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4.4.14 There are no contracts, licenses or agreements between RMLX
and any other Person with respect to RMLX Intellectual Property under which
there is any litigation or other legal proceeding known to RMLX regarding the
scope of such agreement or performance under such contract, license or agreement
including with respect to any payments to be made or received by RMLX
thereunder.
4.4.15 To the knowledge of RMLX, no person has infringed or
misappropriated, or is infringing or misappropriating, any RMLX Intellectual
Property owned by RMLX.
4.4.16 Each material item of RMLX Registered Intellectual Property
is valid and subsisting, all necessary registration, maintenance and renewal
fees currently due in connection with such RMLX Registered Intellectual Property
have been made and all necessary documents, recordations and certificates in
connection with such RMLX Registered Intellectual Property have been filed with
the relevant patent, copyright, trademark or other authorities in the United
States or foreign jurisdictions, as the case may be, for the purposes of
maintaining such RMLX Registered Intellectual Property.
4.4.17 RMLX has not claimed small business status, or other
particular status in the application for any RMLX Registered Intellectual
Property which claim of status was false at the time made or which has since
become inaccurate or false or that will no longer be true and accurate as a
result of the consummation of the Merger.
4.4.18 Except for those items owned by third parties immaterial
portions of freeware, all software products of RMLX were written and created
solely by either (i) employees of RMLX acting within the scope of their
employment, or (ii) by third parties who have validly assigned all of their
rights, including Intellectual Property rights, in such products to RMLX, and no
third party owns any Intellectual Property rights to such software products.
4.4.19 RMLX has not misrepresented or failed to disclose, and is not
aware of any misrepresentation or failure to disclose, any facts or
circumstances in any application for any RMLX Registered Intellectual Property
that would constitute fraud or a material misrepresentation with respect to such
application or that would otherwise effect the validity or enforceability of any
RMLX Registered Intellectual Property.
4.4.20 RMLX has taken all steps reasonable and customary under the
circumstances to protect the confidentiality and trade secret status of any
material confidential information of RMLX, and RMLX knows of no instance in
which a third party has had access to the material confidential information of
RMLX for which it could be claimed that RMLX has failed to protect the
confidentiality of any material confidential information of RMLX.
4.4.21 No employees of RMLX have entered into agreements with RMLX
sufficient to vest title in RMLX to any Intellectual Property created by such
employee in the scope of his or her employment with RMLX.
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4.5 Authority Relative to this Agreement; Enforceability. Subject to the
receipt of any governmental approvals and approval of RMLX's and Subcorp's
stockholders, if necessary, the execution, delivery and performance of this
Agreement are within the corporate power and authority of RMLX and Subcorp and
have been duly authorized by all requisite corporate action on the part of RMLX.
This Agreement is a legal, valid and binding obligation of RMLX and Subcorp,
enforceable against each of RMLX and Subcorp in accordance with its terms,
except insofar as its enforcement may be limited by (a) bankruptcy, insolvency,
moratorium or similar laws affecting the enforcement of creditors' rights
generally and (b) equitable principles limiting the availability of equitable
remedies. All persons who executed this Agreement on behalf of RMLX and Subcorp
have been duly authorized to do so.
4.6 Compliance with Other Instruments; Consents. Except as set forth in
Section 4.6 of the RMLX Disclosure Schedule, neither the execution and delivery
of this Agreement by RMLX nor the consummation of the transactions contemplated
hereby will:
4.6.1 conflict with, or result in a breach of any provision of,
RMLX's Certificate of Incorporation, by-laws or other organizational documents;
4.6.2 violate, or conflict with, or result in a breach of any
provision of, or constitute a default (or an event which, with the giving of
notice, the passage of time or otherwise, would constitute a default) under, or
entitle any party (with the giving of notice, the passage of time or otherwise)
to terminate, accelerate, modify or call a default under, or result in the
creation of any Lien upon any of the properties or assets of RMLX under, any of
the terms, conditions or provisions of any note, bond, mortgage, indenture, deed
of trust, license, contract, undertaking, agreement, lease or other instrument
or obligation to which RMLX is a party;
4.6.3 violate any order, writ, injunction, decree, statute, rule or
regulation applicable to RMLX, its properties or its assets; or
4.6.4 require any action or consent or approval of, or review by, or
registration or filing by RMLX or any of its Affiliates with, any third party or
any governmental authority, other than (i) registrations or other actions
required under federal and state securities laws as are contemplated by this
Agreement, or (ii) the filing of the Certificate of Merger pursuant to the
Statute, except, in the case of Sections 4.6.2, 4.6.3 and 4.6.4, for any of the
foregoing that, individually or in the aggregate, is not reasonably likely to
have a RMLX Material Adverse Effect.
4.7 Compliance with Applicable Laws. RMLX is in compliance in all material
respects with all Laws and, since January 1, 2002, RMLX has not received any
notice or advice to the contrary. All reports relating to RMLX required to be
filed since January 1, 2003 with any governmental authority, including any
governmental authority issuing licenses or qualifications to acquire, import,
export, manufacture, assemble or sell various classes and types of products or
services sold by RMLX, have been timely filed and all information contained
therein is true and correct in all material respects.
4.8 RMLX SEC Documents and Other Public Disclosures. RMLX has filed with
the SEC all forms, reports, schedules, statements and other documents required
to be filed by it since January 1, 2003 under the Exchange Act and Securities
Act (such documents, as supplemented and amended since the time of filing,
collectively, the "RMLX SEC Documents"). The RMLX SEC Documents, including any
financial statements or schedules included therein, at the time filed (a) did
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
therein, in light of the circumstances under which they were made, not
misleading, and (b) complied in all material respects with the applicable
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requirements of the Securities Act, Exchange Act and the rules and regulations
promulgated thereunder. The financial statements of RMLX included in the RMLX
SEC Documents at the time filed complied as to form in all material respects
with applicable accounting requirements and with the published rules and
regulations of the SEC with respect thereto, were prepared in accordance with
GAAP applied on a consistent basis during the periods involved (except as may be
indicated in the notes thereto or, in the case of unaudited statements, as
permitted by Form 10-Q of the SEC), and fairly present (subject, in the case of
unaudited statements, to normal, recurring audit adjustments) the consolidated
financial position of RMLX and its consolidated subsidiaries as at the dates
thereof and the consolidated results of their operations and cash flows for the
periods then ended. Except as and to the extent reflected, disclosed or reserved
against in the RMLX Current Balance Sheet, as of the date thereof, RMLX did not
have any liabilities, whether absolute, accrued, contingent or otherwise,
material to the consolidated financial condition of RMLX which were required to
be so disclosed under GAAP.
4.9 Taxes. Except as set forth in Section 4.9 of the RMLX Disclosure
Schedule:
4.9.1 All of RMLX's Taxes have been paid in full to the appropriate
governmental authorities or fully accrued or provided for with respect to fiscal
periods covered by the RMLX financial statements included within the RMLX SEC
Documents. All of RMLX filed Tax Returns were (or in the case of Tax Returns to
be filed subsequent to the date hereof, will be) correct and complete in all
material respects when filed.
4.9.2 Section 4.9 of the RMLX Disclosure Schedule sets forth the
extent to which, to RMLX's knowledge, RMLX's Tax Returns have been examined,
audited or investigated by any governmental authority and the results of any
such examination, audit or investigation. No assessments or additional Taxes
have been proposed or threatened against RMLX or any of its assets pursuant to
any such examination. RMLX has not waived any statute of limitations in respect
of Taxes or agreed to any extension of time with respect to a Tax assessment or
deficiency. No issue has been raised in any such examination, audit or
investigation which can reasonably be expected to result in a deficiency in any
years not covered by that examination, audit or investigation. Adjustments, if
any, to all such Tax Returns have been agreed upon and paid by RMLX or are being
contested as indicated in Section 4.9 of the RMLX Disclosure Schedule.
4.9.3 To the best of RMLX's knowledge, there are no pending
investigations of RMLX or its Tax Returns by any taxing authority, and there are
no Tax Liens on any of RMLX's assets.
4.9.4 Except as set forth in Section 4.9.4 of the RMLX Disclosure
Schedule, there are no elections which RMLX has made with respect to the income
Tax treatment of any items which cannot be revoked without the consent of the
applicable governmental authority.
4.9.5 RMLX is not now and has never been a "United States real
property holding corporation", as defined in Section 897(c)(2) of the Code and
Section 1.897-2(b) of the regulations promulgated by the Internal Revenue
Service.
4.9.6 RMLX has filed all escheat returns that it is required to file
and such returns were, when filed, accurate in all material respects. RMLX has
no material escheat liabilities.
4.9.7 RMLX (i) has complied in all respects with all applicable
laws, rules and regulations relating to the payment and withholding of Taxes
from the wages or salaries of employees and independent contractors, (ii) has
paid over to the proper governmental authorities all amounts required to be so
withheld and (iii) is not liable for any Taxes for failure to comply with such
laws, rules and regulations.
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4.9.8 RMLX has not filed any consent under Section 341(f) of the
Code concerning collapsible corporations.
4.9.9 RMLX is not now, and has never been, a member of any group
filing Tax Returns on an affiliated, combined, consolidated, unitary or similar
basis. RMLX is not a party to any Tax allocation or Tax sharing agreement, nor
does RMLX have any liability for any Taxes for any Person other than RMLX as a
transferee or successor, by contract, or otherwise.
4.10 Litigation. Except as set forth in Section 4.10 of the RMLX
Disclosure Schedule, there are no legal, administrative, arbitration or other
proceedings or claims pending or, to RMLX's knowledge, threatened, against RMLX,
nor is RMLX subject to any existing order or judgment other than any orders and
judgments which, individually or in the aggregate, are not reasonably likely to
have a RMLX Material Adverse Effect.
4.11 Adverse Business Changes. Except as set forth in Section 4.11 of the
RMLX Disclosure Schedule, since the date of the RMLX Current Balance Sheet (the
"RMLX Statement Date") there has not been:
4.11.1 Any material adverse change in the working capital, financial
condition, assets, liabilities (whether absolute, accrued, contingent or
otherwise), reserves, operating profits, or business of RMLX, other than changes
in the ordinary course of business; or
4.11.2 Any damage, destruction or loss to RMLX or its properties
(whether or not covered by insurance) materially and adversely affecting RMLX.
4.12 Brokerage. No broker or finder has rendered services to RMLX or, to
RMLX's knowledge, to any stockholder of RMLX in connection with this Agreement
or the transactions contemplated hereby.
4.13 RMLX Disclosure Schedule. All of the facts recited in the RMLX
Disclosure Schedule, except to the extent otherwise explicitly qualified
therein, shall be deemed to be representations of fact as though recited in this
Article IV.
4.14 Full Disclosure. No representation or warranty made in this Article
IV contains any untrue statement of a material fact or omits to state a material
fact necessary to make the statements contained herein not misleading.
ARTICLE V
COVENANTS OF THE PARTIES
5.1 Employees and Employee Benefits. From and after the Effective Time,
RMLX shall treat all service by SuiteSpeed Employees with SuiteSpeed prior to
the Effective Time for all purposes as service with RMLX (except to the extent
such treatment would result in duplicative accrual on or after the Closing Date
of benefits for the same period of service), and, with respect to any medical or
dental benefit plan in which SuiteSpeed Employees participate after the
Effective Time, RMLX shall waive or cause to be waived any pre-existing
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condition exclusions and actively-at-work requirements (provided, however, that
no such waiver shall apply to a pre-existing condition of any SuiteSpeed
Employee who was, as of the Effective Time, excluded from participation in a
benefit plan by virtue of such pre-existing condition), and shall provide that
any covered expenses incurred on or before the Effective Time by a SuiteSpeed
Employee or a SuiteSpeed Employee's covered dependent shall be taken into
account for purposes of satisfying applicable deductible, coinsurance and
maximum out-of-pocket provisions after the Effective Time to the same extent as
such expenses are taken into account for the benefit of similarly situated
employees of RMLX and Subsidiaries of RMLX. For purposes of this Section 5.1,
"SuiteSpeed Employees" shall mean persons who are, immediately prior to the
Effective Time, employees of SuiteSpeed and who become or remain, immediately
after the Effective Time, employees of the Surviving Corporation or RMLX.
5.2 Indebtedness to First National Bank of Colorado. SuiteSpeed has
delivered to RMLX a letter, executed by First National Bank of Colorado, stating
that the Merger will not result in an acceleration of the indebtedness arising
under a $300,000 promissory note given by SuiteSpeed to such bank and providing
for the indebtedness payable thereunder to be paid in twelve monthly
installments of $10,000 each commencing in September 2005, with the balance of
the note being payable in September 2006.
5.3 Registration of Stock Options. Promptly after the Effective Time, RMLX
shall use its Reasonable Best Efforts to register under the Securities Act the
shares issuable upon exercise of the stock options assumed by RMLX pursuant to
Section 2.15, and to keep such registration in effect until such time as all
such stock options shall have been exercised or shall have terminated.
5.4 Michael Wasik. From and after the Effective Time and until the FNB
Notes are paid in full, RMLX hereby agrees to cause the Surviving Corporation's
board of directors to be comprised at all times of at least three directors and
to take all actions necessary and proper to nominate and elect Michael Wasik to
be one of such directors promptly after the Effective Time and at each annual or
special meeting, or pursuant to any written action in lieu of an annual or
special meeting, at which directors of the Surviving Corporation are nominated
or elected, as applicable. From and after the Effective Time and until the FNB
Notes are paid in full, without the prior unanimous consent of the Surviving
Corporation's board of directors, RMLX shall not, directly or indirectly, cause
the Surviving Corporation, or otherwise permit the Surviving Corporation, to
declare bankruptcy, dissolve, voluntarily liquidate or voluntarily wind up its
affairs.
ARTICLE VI
CLOSING DELIVERABLES
6.1 Tax Opinion. At the Closing, (i) Lowenstein Sandler PC (in such
capacity, "Tax Counsel") shall deliver to SuiteSpeed and RMLX an opinion to the
effect that the Merger will constitute a reorganization under Section 368(a) of
the Code and (ii) RMLX and SuiteSpeed shall deliver to Tax Counsel such
representation letters as such Tax Counsel may reasonably request in order to
enable Tax Counsel to deliver such opinion.
6.2 Documents to be Delivered by SuiteSpeed. At the Closing, SuiteSpeed
shall deliver to RMLX the following:
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6.2.1 a certificate of the chief executive officer, chief financial
officer or chief operating officer of SuiteSpeed, dated the Closing Date, to the
effect that (1) the person signing such certificate is familiar with this
Agreement and (2) to the best of such person's knowledge, (a) the
representations and warranties of SuiteSpeed set forth in Article III are true
and correct in all material respects (other than representations and warranties
which are qualified as to materiality, which representations and warranties
shall be true in all respects) on the Closing Date (except for representations
and warranties made as of a specified date, which shall be measured only as of
such specified date), (b) SuiteSpeed has performed in all material respects each
obligation and agreement and has complied in all material respects with each
covenant to be performed and complied with by it under this Agreement at or
prior to the Closing and (c) during the period from the SuiteSpeed Statement
Date through the Closing Date, there has not occurred any act, event or omission
resulting in a SuiteSpeed Material Adverse Effect;
6.2.2 all authorizations, consents, waivers or approvals required in
connection with the execution, delivery and performance of this Agreement by
SuiteSpeed;
6.2.3 the written resignations (in form and substance reasonably
satisfactory to RMLX) of each of the directors of SuiteSpeed who will not be
directors of the Surviving Corporation, effective as of the Closing;
6.2.4 the following documents, each of which shall be executed by
stockholders of SuiteSpeed owning at least 98% of the outstanding shares of
SuiteSpeed Common Stock: (a) the SuiteSpeed Stockholder Consents, in the form
annexed hereto as Appendix 6.2.4A and (b) an investment letter and joinder
agreement, in the form annexed hereto as Appendix 6.2.4B; and
6.2.5 the executed 262 Letter, in the form annexed hereto as
Appendix 6.2.5.
6.3 Documents to be Delivered by Michael Wasik. To induce RMLX to enter
into this Agreement, Michael Wasik has agreed that at the Closing, Michael Wasik
shall deliver to RMLX the following:
6.3.1 the promissory notes payable to Michael Wasik by SuiteSpeed in
the aggregate principal amount of $170,000, which promissory notes shall be
canceled at the Closing in consideration of the issuance to Michael Wasik by
RMLX at the Closing of a number of shares of RMLX Common Stock equal to the
aggregate principal amount plus all accrued and unpaid interest owing under such
promissory notes as of the Closing Date divided by the average of the Average
Market Prices for the last five trading days ending two days prior to the
Closing Date;
6.3.2 an executed employment agreement (the "Employment Agreement")
with RMLX, in the form annexed hereto as Appendix 6.3.2; and
6.3.3 an investment letter and cancellation agreement in form and
substance satisfactory to RMLX (the "Cancellation Agreement").
6.4 Documents to be Delivered by RMLX. At the Closing, RMLX shall deliver
to SuiteSpeed or Michael Wasik, as applicable, the following:
6.4.1 a certificate of the chief executive officer, chief financial
officer or chief operating officer of RMLX, dated the Closing Date, to the
effect that (1) the person signing such certificate is familiar with this
Agreement and (2) to the best of such person's knowledge, (a) the
representations and warranties of RMLX and Subcorp set forth in Article IV are
true and correct in all material respects (other than representations and
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warranties which are qualified as to materiality, which representations and
warranties shall be true in all respects) on the Closing Date (except for
representations and warranties made as of a specified date, which shall be
measured only as of such specified date), (b) RMLX and Subcorp have performed in
all material respects each obligation and agreement and have complied in all
material respects with each covenant to be performed and complied with by them
under this Agreement at or prior to the Closing and (c) during the period from
January 1, 2005 through the Closing Date, there has not occurred any act, event
or omission resulting in a RMLX Material Adverse Effect;
6.4.2 the executed Employment Agreement;
6.4.3 an executed registration rights agreement (the "Registration
Rights Agreement"), in the form annexed hereto as Appendix 6.4.3, which
agreement provides piggyback registration rights to the Stockholders, effective
immediately after the Effective Time; and
6.4.4 an executed Cancellation Agreement and executed letters from
RMLX and its counsel instructing RMLX's transfer agent to deliver to Michael
Wasik a number of shares of RMLX Common Stock, registered in the name of Michael
Wasik, in consideration for the cancellation of the promissory notes described
in Section 6.3., the exact number of shares to be as set forth in the
Cancellation Agreement.
6.5 Promptly after the Effective Time, RMLX shall cause its transfer agent
to deliver to Michael Wasik a number of shares of RMLX Common Stock, registered
in the name of Michael Wasik, in consideration for the cancellation of the
promissory notes described in Section 6.3.1, the exact number of shares to be as
set forth in the Cancellation Agreement.
ARTICLE VII
SURVIVAL OF REPRESENTATIONS AND WARRANTIES
7.1 Survival of Representation and Warranties. The representations and
warranties of the Parties contained in this Agreement (including the schedules
to the Agreement which are hereby incorporated by reference) and in any
instrument delivered pursuant to this Agreement shall not survive for any period
following the Effective Time. This Section 7.1 shall not limit any claim for
fraud or any covenant or agreement by the parties which contemplates performance
after the Effective Time.
ARTICLE VIII
MISCELLANEOUS
8.1 Notices. All notices or other communications required or permitted
hereunder shall be in writing and shall be delivered personally, by facsimile,
by overnight courier or sent by certified or registered mail, postage prepaid,
and shall be deemed given when so delivered personally, or when so received by
facsimile or courier, or if mailed, three calendar days after the date of
mailing, as follows (or at such other address for a party as shall be specified
by like notice):
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if to RMLX or Subcorp:
RoomLinX, Inc.
401 Hackensack Avenue
Hackensack, New Jersey 07601
Attention: Frank Elenio, Chief Financial Officer
Telephone: 201-525-1777, ext. 102
Facsimile: 201-525-1778
with a copy (which shall not constitute notice) to :
Peter H. Ehrenberg
Lowenstein Sandler PC
65 Livingston Avenue
Roseland, New Jersey 07068
Telephone: 973-597-2350
Facsimile: 973- 597-2351
if to SuiteSpeed:
SuiteSpeed, Inc.
2150 Sixth Street
Unit D
Broomfeld, Colorado 80020
Attention: Michael Wasik
Telephone: 303-544-1111
Facsimile: 303-544-1110
with a copy (which shall not constitute notice) to :
Scott A. Berdan
Hogan & Hartson L.L.P.
1200 17th Street, Suite 1500
Denver, Colorado 80202
Telephone: 303-899-7300
Facsimile: 303-899-7333
8.2 Interpretation. When a reference is made in this Agreement to an
Article or Section, such reference shall be to an Article or Section of this
Agreement unless otherwise indicated. The headings contained in this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
8.3 Counterparts. This Agreement may be executed in counterparts, which
together shall constitute one and the same Agreement. The parties may execute
more than one copy of the Agreement, each of which shall constitute an original.
8.4 Entire Agreement. This Agreement (including the appendices, documents
and other instruments referred to herein) and the non-disclosure agreement
previously executed by SuiteSpeed and RMLX constitute the entire agreement among
the parties and supersede all prior agreements, understandings or
representations by or among the parties, written and oral, with respect to the
subject matter hereof and thereof.
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8.5 No Third Party Beneficiaries. Nothing in this Agreement, express or
implied, is intended or shall be construed to create any third party
beneficiaries.
8.6 Governing Law. Except to the extent that the laws of the jurisdiction
of organization of any Party, or any other jurisdiction, are mandatorily
applicable to the Merger or to matters arising under or in connection with this
Agreement, this Agreement shall be governed by the laws of the State of New
Jersey.
8.7 Consent to Jurisdiction; Venue; No Trial by Jury.
8.7.1 Each of the Parties irrevocably submits to the exclusive
jurisdiction of the state and federal courts located in the State of New Jersey,
for the purpose of any action or proceeding arising out of or relating to this
Agreement and each of the Parties irrevocably agrees that all claims with
respect to such action or proceeding shall be heard and determined exclusively
in any New Jersey state or federal court. Each of the Parties agrees that a
final judgment in any action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law.
8.7.2 Each of the Parties irrevocably consents to the service of any
summons and complaint and any other process in any other action or proceeding
relating to the Merger, on behalf of itself or its property, by the delivery of
copies of such process to such party in the same manner as notice is to be
provided pursuant to Section 8.1. Nothing in this Section 8.7.2 shall affect the
right of any party hereto to serve legal process in any other manner permitted
by law.
8.7.3 Each Party acknowledges and agrees that any controversy which
may arise under this Agreement is likely to involve complicated and difficult
issues, and therefore each Party hereby irrevocably and unconditionally waives
any right such Party may have to a trial by jury in respect to any litigation
directly or indirectly arising out of or relating to this Agreement or the
transactions contemplated by this Agreement. Each Party certifies and
acknowledges that (i) no representative, agent or attorney of any other Party
has represented, expressly or otherwise, that such other Party would not, in the
event of litigation, seek to enforce the foregoing waiver, (ii) each such Party
understands and has considered the implications of this waiver, (iii) each such
Party makes this waiver voluntarily, and (iv) each such Party has been induced
to enter into this Agreement by, among other things, the waivers and
certifications in this Section 8.7.3.
8.8 Specific Performance. The parties hereto agree that irreparable damage
would occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached. It
is accordingly agreed that, in addition to any other remedy to which they are
entitled at law or in equity, the Parties will be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions hereof.
8.9 Assignment. Neither this Agreement nor any of the rights, interests or
obligations hereunder shall be assigned by any of the Parties (whether by
operation of law or otherwise) without the prior written consent of the other
Parties. Subject to the preceding sentence, this Agreement shall be binding
upon, inure to the benefit of and be enforceable by the Parties and their
respective successors and assigns.
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8.10 Expenses. All costs and expenses incurred in connection with this
Agreement and the transactions contemplated hereby and thereby shall be paid by
the Party incurring such expense.
8.11 Severability. The invalidity of any portion hereof shall not affect
the validity, force or effect of the remaining portions hereof. If it is ever
held that any restriction hereunder is too broad to permit enforcement of such
restriction to its fullest extent, such restriction shall be enforced to the
maximum extent permitted by law.
8.12 No Strict Construction. Each of RMLX, Subcorp and SuiteSpeed
acknowledges that this Agreement has been prepared jointly by the parties
hereto, and shall not be strictly construed against any party.
8.13 Knowledge. Any representation made herein which is qualified by the
knowledge of, or notice given to, SuiteSpeed shall refer to the actual knowledge
of, or notice actually given to, any of the executive officers of SuiteSpeed.
Any representation made herein which is qualified by the knowledge of, or notice
given to, RMLX shall refer to the actual knowledge of, or notice actually given
to, any of the executive officers of RMLX.
8.14 Termination. Notwithstanding any provision herein to the contrary, it
is acknowledged that (a) the Closing shall not occur and the Merger shall not be
consummated unless, prior to the commencement of the Merger but after the
execution of this Agreement, fully executed Stockholder Consent Documents shall
be delivered to RMLX and (b) this Agreement shall terminate, without liability
to any party hereto, in the event that fully executed Stockholder Consent
Documents are not delivered to RMLX within forty-eight hours after this
Agreement is executed.
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IN WITNESS WHEREOF, RMLX, Subcorp and SuiteSpeed have signed this
Agreement and Plan of Merger as of the date first written above.
ROOMLINX, INC
By: /s/ Aaron Dobrinsky
----------------------------------
Name: Aaron Dobrinsky
Title: Chief Executive Officer
SS-R ACQUISITION CORP.
By: /s/ Aaron Dobrinsky
----------------------------------
Name: Aaron Dobrinsky
Title: Chief Executive Officer
SUITESPEED, INC.
By: /s/ Michael Wasik
----------------------------------
Name: Michael Wasik
Title: President
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LIST OF APPENDICES
Certificate of Merger Appendix 2.4
Employment Agreement Appendix 6.3.2
Registration Rights Agreement Appendix 6.4.3
Stockholder Consent Form Appendix 6.2.4A
Stockholder Investment Letter and Joinder Agreement Appendix 6.2.4B
262 Letter Appendix 6.2.5
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