TRANSITIONAL SERVICES AGREEMENT

This Transitional Services Agreement (the “Agreement”) is entered into this __ day of ____________ 2014 by and among Signal Share, Inc. (f/k/a Roomlinx Inc.), a Nevada corporation (“Purchaser”), SIGNAL POINT HOLDINGS CORP., a Delaware corporation (“SPHC”), the sole shareholder of SIGNAL POINT CORP., a New York corporation (“SPC”), ROOMLINX INC., a Nevada corporation (“RLI”) and sole shareholder of CARDINAL BROADBAND, a _______corporation (the “CBB”). SPHC and RLI are referred to herein as “Sellers” and SPC and CBB are referred to as “Utilities.” (Purchaser, Sellers, and Utilities are collectively referred to herein as the “Parties”).

 

Capitalized terms used but not defined in this Agreement shall have the meaning set forth in that certain Agreement and Plan of Merger, by and among Sellers and Signal Point Acquisition Corp., dated as of the date hereof (the “MA”).

WHEREAS, the Utilities are in the business of providing domestic and international telecommunications services (“Business”), pursuant to licenses issued by the Federal Communications Commission (“FCC”); and

WHEREAS, the Utilities are in the business of providing intrastate local and long distance telecommunications services pursuant to licenses issued by various state regulatory authorities having jurisdiction over the provision of telecommunications services (referred to herein as “State PUCs”); and

WHEREAS, as of even date herewith, the Parties entered into the MA, pursuant to which a change in control shall occur with respect to the Utilities as contemplated in the MA (the “Transaction”); and

WHEREAS, since the Parties must obtain necessary regulatory approvals associated with the Transaction on behalf of the Utilities, the Parties have agreed upon a two-step closing process for the Transaction including an initial closing (“Initial Closing”) which is occurring after all the conditions that are set forth in the MA have occurred, been satisfied or waived, except the referenced regulatory approvals which will be satisfied by the time of the second closing (“Second Closing”); and

WHEREAS, the Parties are entering into this Agreement to seek to ensure that the Parties are in material compliance with the terms of the Utilities’ licenses, and federal and state telecommunications regulations, during the period between the date of the Initial Closing and the date of the Second Closing (the “Transition Period”).

NOW, THEREFORE, in consideration for the promises and covenants contained herein, and other good and valuable consideration the receipt and sufficiency of which the Parties hereby acknowledge, the Parties agree as follows:

 

The Parties shall utilize a two-step closing process with respect to the Transaction as follows:

(a)          Initial Closing. At the Initial Closing, (i) Purchaser shall deliver to Seller the Purchase Price as set forth and in accordance with the terms and provisions of the MA and (ii) the issued and outstanding stock of the Utilities shall be transferred in accordance with the MA (the “Transfer”) and shall be held in escrow by Davidoff, Hutcher & Citron LLP, as escrow agent (the “Escrow Agent”) pursuant that certain escrow agreement between the Parties, attached hereto as Exhibit A (“Escrow Agreement”); provided, however, that the Parties expressly acknowledge and agree that the Transfer shall remain subject to the Parties’ obligations to obtain all required regulatory approvals from the FCC or the State PUCs with respect to the Transaction as set forth in MA (the “Regulatory Approvals”). The Parties shall cooperate in good faith to file all applications for such Regulatory Approvals within ten (10) business days after the Initial Closing.

 

(b)          Second Closing. At the Second Closing, which shall occur no later than five (5) business days after the Parties receive the last Regulatory Approval necessary to consummate the Transaction, (i) the Parties shall execute and deliver all remaining documents necessary, if any, to effectuate the Transaction and (ii) the issued and outstanding stock of the Utilities released by the Escrow Agent to Purchaser pursuant to the terms of the Escrow Agreement.

 

(a)          During the Transition Period, Sellers hereby irrevocably retain and appoint Purchaser to manage all of the day-to-day business, operations, and telecommunications services of any kind provided by the Utilities (referred to herein as the “Business”) pursuant to the Licenses issued to the Utilities by the FCC and the State PUCs.

(i)           Purchaser shall take all reasonably necessary, prudent, and appropriate actions to manage the Business, including by way of example, and not limitation, providing technical and customer service, billing, collection, transfer of payments hereunder, and other related endeavors, in such manner as Purchaser deems appropriate in the good faith exercise of its reasonable business judgment.

(ii)          Purchaser shall have full power and authority to manage and operate the Business in the ordinary course of business in accordance with the exercise of its good faith reasonable business judgment.

(iii)         Notwithstanding the foregoing, Purchaser shall manage the Business in accordance with all applicable rules, regulations, and laws, including, but not limited to, those regulations of the FCC and the State PUCs, and with the same care and regard as it manages its own affairs and business. In connection with its management of the Business, Purchaser shall have the right and power to do or cause to be done all acts and things in the name of and on behalf of the Sellers and Utilities as the Sellers and/or Utilities are authorized by the FCC and the State PUCs.

(c)           The Parties shall work together in good faith during the Transition Period to ensure the continued provision of high quality services, and Sellers, and the Utilities shall cooperate with Purchaser with respect to Purchaser’s management of the Business pursuant to this Agreement, including by providing full access to the Utilities’ management, timely supplying information, and otherwise assisting Purchaser in good faith.

(d)           During the Transition Period, the Parties shall consult with each other from time to time regarding material operating procedures and decisions affecting the customers of the Business.

(e)           The Parties desire that this Agreement and the obligations hereunder be in compliance with (i) the terms and conditions of the Utilities’ Licenses; (ii) all applicable rules, regulations and policies of the FCC and State PUCs; (iii) the Communications Act of 1934, as amended, (the “Act”); and (iv) any other applicable federal, state and local law or regulation. If the FCC or any State PUC determines that any provision of this Agreement violates any applicable rules, regulations, or policies, both Parties shall make reasonable efforts to immediately bring this Agreement into compliance, consistent with the terms of this Agreement and the MA. It is expressly understood by the Parties that nothing in this Agreement is intended to give, or shall be construed to give, Purchaser any right during the Transition Period that would be deemed to constitute a transfer of control or an assignment (as “control” and “assignment” is defined in the Act, and/or any applicable FCC or state regulations, rules or case law) by the Utilities of the Business or the Licenses. For the avoidance of any doubt, during the Transition Period, the Utilities shall be deemed to retain the Licenses, and shall be deemed to operate the Business, consistent with the terms of this Agreement.

(f)           During the Transition Period, Purchaser shall not represent itself as the holder of any of the Licenses before the FCC, or any State PUC.

(g)           In accordance with their obligations under this Agreement, the Utilities shall continue to make all requisite filings, and shall file all reports and correspondence with the State PUCs and the FCC regarding the Utilities’ Business and Licenses. The Parties shall cooperate in the preparations of such filings where necessary.

(h)    The Utilities and Sellers covenant and agree that they will respond in a timely manner to any and all data requests, interrogatories, questionnaires, or similar requests issued by the FCC or the State PUCs pertaining to the applications for Regulatory Approvals, including by timely providing access to Utilities management, and by timely supplying information to the FCC or the State PUCs, as the case may be.

 

This Agreement shall terminate on the date of the Second Closing, which shall occur no later than five (5) business days after all approvals required to effectuate the Second Closing have been obtained; provided in the event the event the Regulatory Approvals are not obtained, this Agreement shall terminate in accordance with the terms of the MA.