INTERCLOUD SYSTEMS, INC. (ICLD) SPO
|Company Name||INTERCLOUD SYSTEMS, INC.|
|Company Address||2500 N. MILITARY TRAIL
BOCA RATON, FL 33431
|Employees (as of 3/31/2013)||455|
|State of Inc||--|
|Fiscal Year End||12/31|
|Exchange||Nasdaq SmallCap Market|
|Shares Over Alloted||--|
|Shareholder Shares Offered||--|
|Lockup Period (days)||180|
|Quiet Period Expiration||--|
We estimate that the net proceeds to us from the sale of the [ ] shares we are offering will be approximately $[ ] million, based upon an assumed offering price of $[ ] per share. If the representative of the underwriters fully exercises the over-allotment option, we estimate the net proceeds of the shares we sell will be approximately $[ ] million. “Net proceeds” is what we expect to receive after paying the underwriters fees and other expenses of this offering. For purposes of estimating net proceeds, we are assuming that the public offering price will be $[ ] per share. Each $[ ] increase (decrease) in the assumed offering price of $[ ]per share would increase (decrease) the net proceeds to us from this offering, after deducting the estimated underwriting fees and estimated offering expenses payable by us, by approximately $[ ] million, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same. We may also increase or decrease the number of shares we are offering. An increase (decrease) of [ ] in the number of shares we are offering would increase (decrease) the net proceeds to us from this offering, after deducting the estimated underwriting fees and estimated offering expenses payable by us, by approximately $[ ]million, assuming the offering price stays the same. An increase of [ ]in the number of shares we are offering, together with a $[ ]increase in the assumed offering price per share, would increase the net proceeds to us from this offering, after deducting the estimated placement agent fees and estimated offering expenses payable by us, by approximately $[ ]million. A decrease of [ ]in the number of shares we are offering, together with a $[ ]decrease in the assumed offering price per share, would decrease the net proceeds to us from this offering, after deducting the estimated underwriting fees and estimated offering expenses payable by us, by approximately $[ ] million. We do not expect that a change in the offering price or the number of shares by these amounts would have a material effect on our intended uses of the net proceeds from this offering, although it may impact the amount of time prior to which we may need to seek additional capital. We intend to use the net proceeds from this offering for the following purposes: . approximately $16.8 million to complete our acquisition of the Telco Professional Services and Handset Testing business division of Tekmark Global Solutions, LLC concurrently with the consummation of this offering; . approximately $18.2 million to complete our acquisition of Integration Partners-NY Corporation concurrently with the consummation of this offering; . $1,725,000 to pay in full our outstanding convertible bridge note indebtedness; and . any remaining balance for working capital or general corporate purposes. On April 30, 2013 and May [ ], 2013, we borrowed an aggregate of $1,725,000 from ICG USA, LLC to fund certain working capital expenditures. Under the terms of such loans, we received net proceeds of $1,500,000 and are not required to pay additional interest. The difference between the amount of such loans and the net proceeds we received of $225,000 represents prepaid interest that is being amortized over the term of such loans. Such loans mature on the third business day following the consummation of this offering, or six months after the date of such loans if this offering is not completed. Until we use the net proceeds of this offering, we intend to invest the funds in short-term, interest-bearing investments, which may include interest- bearing bank accounts, money market funds, certificates of deposit and U.S. government securities.
The business of providing infrastructure and managed services to telecommunications companies and enterprise clients is highly fragmented and the business is characterized by a large number of participants, including several large companies, as well as a significant number of small, privately-held, local competitors. Our current and potential larger competitors include Arrow Electronics, Inc., Black Box Corporation Dimension Data, Dycom Industries, Inc., Goodman Networks, Inc., MasTec, Inc., TeleTech Holdings, Inc., Unisys Corporation, Unitek Global Services, Inc., Tech Mahindra and Volt Information Sciences, Inc. A significant portion of our services revenue is currently derived from MSAs and price is often an important factor in awarding such agreements. Accordingly, our competitors may underbid us if they elect to price their services aggressively to procure such business. Our competitors may also develop the expertise, experience and resources to provide services that are equal or superior in both price and quality to our services, and we may not be able to maintain or enhance our competitive position. The principal competitive factors for our services include geographic presence, breadth of service offerings, worker and general public safety, price, quality of service and industry reputation. We believe we compete favorably with our competitors on the basis of these factors.
We are a global single-source provider of value-added services for both corporate enterprises and service providers. We offer cloud and managed services, professional consulting services and voice, data and optical solutions to assist our customers in meeting their changing
technology demands. Our cloud solutions offer enterprise and service-provider customers the opportunity to adopt an operational expense model by outsourcing to us rather than the capital expense model that has dominated in recent decades in information technology (IT) infrastructure management. Our professional services groups offer a broad range of solutions, including application development teams, analytics, project management, program management, telecom network management and field services. Our 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. We provide the following categories of offerings to our customers: . Cloud and Managed Services. Our cloud-based service offerings include platform as a service (PaaS), infrastructure as a service (IaaS), database as a service (DbaaS), and software as a service (SaaS). Our extensive experience in system integration and solutions-centric services helps our customers quickly to integrate and adopt cloud-based services. Our managed- services offerings include network management, 24x7x365 monitoring, security monitoring, storage and backup services. . Applications and Infrastructure. We provide an array of applications and services throughout North America and internationally, including unified communications, interactive voice response (IVR) and SIP-based call centers. We also offer structured cabling and other field installations. In addition, we design, engineer, install and maintain various types of WiFi and wide- area networks, distributed antenna systems (DAS), and small cell distribution networks for incumbent local exchange carriers (ILECs), telecommunications original equipment manufacturers (OEMs), cable broadband multiple system operators (MSOs) and enterprise customers. Our services and applications teams support the deployment of new networks and technologies, as well as expand and maintain existing networks. We also design, install and maintain hardware solutions for the leading OEMs that support voice, data and optical networks. . Professional Services. We provide consulting and professional staffing solutions to the service-provider and enterprise market in support of all facets of the telecommunications business, including project management, network implementation, network installation, network upgrades, rebuilds, maintenance and consulting services. We leverage our international recruiting database, which includes more than 70,000 professionals, for the rapid deployment of our professional services. On a weekly basis, we deploy hundreds of telecommunications professionals in support of our worldwide customers. Our skilled recruiters assist telecommunications companies, cable broadband MSOs and enterprise clients throughout the project lifecycle of a network deployment and maintenance. -------- We were incorporated under the name i-realtyauction.com, Inc. in the State of Delaware on November 22, 1999 as a subsidiary of i-Incubator.com, Inc. (OTCBB:INQU). In November 2000, we registered our common stock pursuant to Section 12(g) of the Securities Exchange Act of 1934, as amended, or the “Exchange Act,” and commenced filing periodic reports under the Exchange Act in March 2001. On August 16, 2001, we changed our name to Genesis Realty Group, Inc. and began to focus our attention on the acquisition, development and management of real property. In August 2008, we changed our name to Genesis Group Holdings, Inc., and on January 10, 2013, we changed our name to InterCloud Systems, Inc. We commenced operations in our current line of business in January 2010 when we acquired Digital Comm, Inc., a provider of turnkey services and solutions to the communications industry. Our principal executive offices are located at 2500 N. Military Trail, Suite 275, Boca Raton, Florida 33431. The telephone number of our principal executive offices is (561) 988-1988, and we maintain a corporate website at www.InterCloudsys.com.