Spectrum Global Solutions, Inc. (OTCPK:SGSI) acquired Telnet Solutions Inc. from InterCloud Systems, Inc. (OTCPK:ICLD) for $1.6 million on January 4, 2019. Under the terms of the agreement, the purchase price paid by Spectrum includes $0.98 million in cash, paid at closing, and the issuance to InterCloud of a convertible promissory note ("Note") in the aggregate principal amount of $0.62 million. The interest on the outstanding principal due under the Note accrues at a rate of 6% per annum. All principal and accrued interest under the Note is due January 30, 2020, and is convertible, at any time at InterCloud's election, into shares of common stock of the Spectrum at a conversion price equal to the greater of 75% of the lowest volume-weighted average price during the 10 trading days immediately preceding the date of conversion and $0.10. Further, proceeds of $1 million from the agreement of future receipts between Spectrum and Libertas Funding were used to finance the acquisition.

For Telnet, annual revenue for 2018 was more than $6 million; producing more than $1 million of adjusted EBITDA. Simultaneously upon the closing of the sale of Telnet to Spectrum, the resignation of each of the pre-sale officers and directors of the Telnet shall become effective. M. Ali Panjwani of Pryor Cashman LLP acted as legal advisor to Spectrum and Milo Silberstein of Dealy Silberstein & Braverman, LLP acted as legal advisor to InterCloud.

Spectrum Global Solutions, Inc. (OTCPK:SGSI) completed the acquisition of Telnet Solutions Inc. from InterCloud Systems, Inc. (OTCPK:ICLD) on January 4, 2019.