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InterCloud Systems, Inc.
a single-source provider of
end-to end IT and telecom solutions to the service provider and corporate
enterprise markets through cloud platforms and professional services,
announced today the execution of a definitive agreement to acquire Integration
Partners-NY Corporation ("IPC-NY"). IPC-NY serves both corporate enterprises
and services providers, and is expected to support the Company's cloud and
managed services capabilities. IPC-NY has enterprise and service provider
customers and will help distribute the Company's cloud platform to its new and
existing customers. IPC-NY is expected to have 2013 gross revenues of
approximately $25 million and 2013 net income of approximately $3.5
million. The Company expects to close the acquisition of IPC-NY no later than
December 31, 2013.
In order to finance this acquisition, the Company completed the sale today of
$11.625 million aggregate principal amount of 12% convertible debentures (the
"Debentures").
The Debentures bear interest at the rate of 12% per annum, and mature on June
13, 2015. At the Company's election, subject to certain conditions, principal
and interest payments on the Debentures may be paid in shares of the Company's
common stock. The Debentures also are convertible into shares of the Company's
common stock at the election of the holders at a conversion price equal to the
lesser of (i) $6.36, or (ii) 85% of the price per share of the common stock in
the Company's first underwritten public offering of not less than $10 million,
in each case subject to customary adjustments.
In connection with the sale of the Debentures, the Company agreed to register
for resale under the Securities Act of 1933 the shares of common issued or
issuable upon conversion or payment of the Debentures by filing a resale
registration statement with the Securities and Exchange Commission within ten
days of the filing of its Annual Report on Form 10-K for the year ending
December 31, 2013. The Company also entered into a voting agreement with
certain members of management and certain holders of its common stock pursuant
to which those parties agreed to vote in favor of any stockholder proposal
seeking to approve the issuance of shares of common stock in connection with
the conversion or payment of the Debentures.
Aegis Capital Corp. acted as the sole placement agent for the offering.
InterCloud CEO, Mark E. Munro, stated, "We are excited about the synergies
this acquisition brings to InterCloud and its immediate accretive earnings
affect. IPC-NY is a growing business with a seasoned and successful management
team. There are significant growth opportunities in cloud-based solutions that
allow both enterprises and service providers to integrate their applications
and various services into our cloud platform and offer them the ability to
deliver services cost efficiently to their customers. InterCloud and IPC-NY
create a dynamic organization that leverages our capabilities to deliver and
support the many facets of cloud applications and managed services. We are
very pleased that we had the institutional support to enable this transaction
to happen."
About InterCloud Systems, Inc.
InterCloud Systems, Inc. is a global single-source provider of value-added
services for both corporate enterprises and service providers. The Company
offers cloud and managed services, professional consulting services and voice,
data and optical solutions to assist its customers in meeting their changing
technology demands. Its engineering, design, installation and maintenance
services support the build-out and operation of some of the most advanced
enterprise, fiber optic, Ethernet, and wireless networks. Additional
information regarding InterCloud may be found on the Company's website at
www.intercloudsys.com.
About Integration Partners-NY Corporation
Integration Partners-NY is a managed service provider offering its enterprise
and service provider clients an end-to-end portfolio of IT solutions including
voice, data, optical and unified communications services. IPC-NY consults,
designs, builds, implements, and services IT networks for enterprise and
service provider networks. The synergies with InterCloud will allow its
clients to transition from existing IT networks to open architecture Cloud
based solutions.
Forward-looking statements:
The above news release contains forward-looking statements. The statements
contained in this document that are not statements of historical fact,
including but not limited to, statements identified by the use of terms such
as "anticipate," "appear," "believe," "could," "estimate," "expect," "hope,"
"indicate," "intend," "likely," "may," "might," "plan," "potential,"
"project," "seek," "should," "will," "would," and other variations or negative
expressions of these terms, including statements related to expected market
trends and the Company's performance, are all "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act of 1995 and
involve a number of risks and uncertainties. These statements are based on
assumptions that management believes are reasonable based on currently
available information, and include statements regarding the intent, belief or
current expectations of the Company and its management. Prospective investors
are cautioned that any such forward-looking statements are not guarantees of
future performances, and are subject to a wide range of external factors,
uncertainties, business risks, and other risks identified in filings made by
the company with the Securities and Exchange Commission. Actual results may
differ materially from those indicated by such forward-looking statements. The
Company expressly disclaims any obligation or undertaking to update or revise
any forward-looking statement contained herein to reflect any change in the
company's expectations with regard thereto or any change in events, conditions
or circumstances upon which any statement is based except as required by
applicable law and regulations.
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