EXHIBIT 2.3
FIRST AMENDMENT TO AGREEMENT AND PLAN OF MERGER
THIS FIRST AMENDMENT to the Agreement and Plan of Merger between Reality
Wireless Networks, Inc., a Nevada corporation ("Reality"), Reality Acquisition,
Inc., a Washington corporation ("Acquisition Sub"), and Arabian Recab for
Trading Co., a corporation duly incorporated under the laws of Saudi Arabia
("Arabian Recab"), dated July 21, 2005 (the "Agreement"), is entered into on
this 7th day of October 2005, is hereby amended as follows (the "Amendment"):
RECITALS
A. Reality, Acquisition Sub, and Arabian Recab (collectively, the "Parties")
entered into an Agreement and Plan of Merger on July 21, 2005;
B. In furtherance of the merger, the parties wish to amend the Agreement in
order to clarify and acknowledge the terms defining Effective Time (defined
herein) of the merger and the resulting obligations thereby created.
C. Unless otherwise defined in this Amendment, capitalized terms have the
meaning as defined in the Agreement.
Accordingly, the parties hereby agree as follows:
I. Section 1 of the Agreement is hereby deleted in its entirety and replaced as
follows:
1. MERGER.
1.1. Effect on Capital Stock. As soon as practicable following the Effective
Time, by virtue of the Merger and without any action on the part of the holder
of any Recab Rights or any shares of capital stock of Acquisition Sub:
(a) Capital Stock of Acquisition Sub. Each issued and outstanding share of
capital stock of Acquisition Sub shall be converted into one Recab Right that
shall be held by the corporate-entity Arabian Recab (the resulting stock
referred to hereinafter as "Treasury Stock" of Arabian Recab).
(b) Cancellation of Treasury Stock of Arabian Recab owned by Arabian Recab. Each
share of Arabian Recab that is owned by Arabian Recab shall automatically be
cancelled and shall cease to exist, and no consideration shall be delivered or
deliverable in exchange therefore.
(c) Conversion of the Arabian Recab Shares. All Arabian Recab Shares (other than
shares to be canceled in accordance with Section 1.1(b)) shall be converted into
fully paid and nonassessable shares of common stock, par value $0.001 per share,
of the Reality Shares necessary to give effect to the relative ownership of
Reality Shares by Arabian Recab Share holders expressed above in Recital D. As
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of the Effective Time, all the Arabian Recab Shares shall no longer be
outstanding and shall automatically be canceled and shall cease to exist, and
each holder of a certificate representing any such shares of Arabian Recab
Shares shall cease to have any rights with respect thereto, except the right to
receive the portion of the Reality Shares to be issued in consideration
therefore in accordance herewith.
1.2 Resultant Obligations: Unless this Agreement is validly terminated prior to
the Effective Time, the Parties agree to the following:
(a) Effective Time. The Parties agree and acknowledge that the
"Effective Time" shall occur on August 19, 2005.
(b) Articles of Merger. As soon as practicable following the Effective
Time the Parties shall file Articles of Merger ("Articles of
Merger") in accordance with applicable provisions of Saudi Arabia,
Washington law and Nevada law (the "Applicable Law"). The Articles
of Merger shall be filed together with any other filings or
recordings required by the Applicable Law in connection with the
Merger.
1.3 Procedure. Each and all of the Arabian Recab Shares outstanding immediately
prior to the Effective Time shall, as soon as practicable following the
Effective Time, be exchanged for a certificate or certificates evidencing
ownership of the applicable number of the Reality Shares. The Reality Shares
exchanged for Arabian Recab Shares shall be referred to herein as the "Closing
Shares".
1.4 Name Change. As soon as practicable following the Effective Time, the
articles of incorporation of Reality shall be amended such that the name
"Reality Wireless Networks, Inc." shall become "Recab International, Inc."
II. Section 2.1 of the Agreement is hereby deleted in its entirety and replaced
as follows:
2.1 Date, Time and Place of Closing. The Merger contemplated by this Agreement
shall take place at a closing to be held at The Otto Law Group, PLLC, and shall
be deemed effective upon the execution of this Agreement (the "Closing"), and
shall remain subject to completion and satisfaction of certain conditions
subsequent to the Closing (the "Conditions Subsequent"). The date on which the
Closing occurs is referred to in this Agreement as the "Closing Date."
III. Section 2.4 of the Agreement is hereby deleted in its entirety and replaced
as follows:
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2.4 Schedule 14C. As soon as practicable following the Effective Time, Reality
shall prepare and file with the SEC a Schedule 14C to disclose to the
shareholder approval of the following:
(1) The change in entity name from Reality, Inc., to Recab International
Inc., and
(2) A reverse split of the issued and outstanding Reality common stock
(the Reverse Split") such that the pre-Merger Reality shareholders
shall retain a post Merger, post Reverse Split ownership interest of
not less than two percent (2%) of the merged entity immediately
following the time at which the Reverse Split becomes effective.
IN WITNESS WHEREOF, the Parties hereto have caused this Amendment to be executed
as of the date first listed above.
Reality:
REALITY WIRELESS NETWORKS, INC.:
By: /s/ Steve Careaga
----------------------------
Name: Steve Careaga
Title: Chief Executive Officer
Arabian Recab:
ARABIAN RECAB FOR TRADING CO.
By: /s/ Patrick Lochrie
----------------------------
Name: Patrick Lochrie
Title: President and Chief
Executive Officer
ACQUISITION SUB:
REALITY ACQUISITION, INC.
By: /s/ Steve Careaga
----------------------------
Name: Steve Careaga
Title: President and Secretary
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