10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2019

Or

☐ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from             to               

Commission File Number 000-53461

SPECTRUM GLOBAL SOLUTIONS, INC. 

(Exact name of registrant as specified in its charter)

Nevada	26-0592672
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)
300 Crown Oak Centre Drive, Longwood, Florida	32750
(Address of principal executive offices)	(Zip Code)

407-512-9102

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ YES ☐ NO

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). ☒ YES ☐ NO

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) ☐ YES ☒ NO

APPLICABLE ONLY TO ISSUERS INVOLVED IN
BANKRUPTCY PROCEEDINGS DURING THE
PRECEDING FIVE YEARS

Check whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court. ☐ YES ☐ NO

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock	SGSI	OTCQB

APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

33,557,903 common shares issued and outstanding as of May 14, 2019

Table of Contents

PART I – FINANCIAL INFORMATION		1
Item 1.	Financial Statements	1
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	32
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	37
Item 4.	Controls and Procedures	37
PART II – OTHER INFORMATION		38
Item 1.	Legal Proceedings	38
Item 1A.	Risk Factors	38
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	38
Item 3.	Defaults Upon Senior Securities	39
Item 4.	Mine Safety Disclosures	39
Item 5.	Other Information	39
Item 6.	Exhibits	39
SIGNATURES		40

i

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

The unaudited interim consolidated financial statements of our company have been prepared in accordance with generally accepted accounting principles in the United States of America and are presented in US dollars, unless otherwise noted.

SPECTRUM GLOBAL SOLUTIONS, INC.

	Page Number
Condensed Consolidated balance sheets as of March 31, 2019 (unaudited) and December 31, 2018	2
Condensed Consolidated statements of operations for the three months ended March 31, 2019 and 2018 (unaudited)	3
Condensed Consolidated statements of stockholder’s equity (deficit) for the three months ended March 31, 2019 and 2018	4
Condensed Consolidated statements of cash flows for the three months ended March 31, 2019 and 2018 (unaudited)	5
Notes to unaudited condensed consolidated financial statements	6

1

SPECTRUM GLOBAL SOLUTIONS, INC.

Condensed consolidated balance sheets

(Expressed in U.S. dollars)

	March 31,			December 31,
	2019			2018
	$			$
	(unaudited)
ASSETS
Current assets
Cash		966,790			620,593
Accounts receivable (net of allowance for doubtful accounts of $514,302 and $502,868, respectively)		7,759,001			6,562,182
Contract assets		2,227,195			1,861,895
Prepaid expenses and deposits		262,775			22,682
Total current assets		11,215,761			9,067,352
Property and equipment (net of accumulated depreciation of $1,027,977 and $1,020,959, respectively)		106,779			61,257
Goodwill		2,505,615			1,834,856
Customer lists (net of accumulated amortization of $249,121 and $187,299, respectively)		2,588,427			850,249
Tradenames (net of accumulated amortization of $143,922 and $118,810, respectively)		1,361,683			1,086,795
Operating lease right-of use assets		232,325			-
Other assets		26,296			29,887
Total assets		18,036,886			12,930,396
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities
Accounts payable and accrued liabilities		7,162,898			5,472,108
Contract liabilities		449,950			-
Loans payable		6,134,673			3,637,078
Loans payable to related parties		313,858			313,858
Convertible debentures (net of discount of $1,360,735 and $1,770,073, respectively)		5,188,558			4,842,391
Derivative liability		2,874,674			3,166,886
Warrant liability		100,000			100,000
Operating lease liabilities		233,191			-
Total current liabilities		22,457,802			17,532,321
Mezzanine equity
Preferred stock authorized: 8,000,000 Series A preferred stock, par value $0.00001 Issued and outstanding: 899,427 (December 31, 2018 – 899,427) shares		604,877			604,877
Preferred stock authorized: 1,000 Series B preferred stock, stated value $3,500 Issued and outstanding: 1,000 (December 31, 2018 – 1,000) shares		484,530			484,530
Stockholders’ deficit
Common stock Authorized: 750,000,000 shares, par value $0.00001 Issued 14,826,590 (December 31, 2018- 12,907,869); Outstanding: 9,006,147 (December 31, 2018 – 7,087,426)		148			77
Additional paid-in capital		20,194,915			18,681,390
Treasury stock, at cost		(277,436	)		(277,436	)
Common stock subscribed		74,742			74,742
Accumulated deficit		(25,502,692	)		(24,170,105	)
Total stockholders’ deficit		(5,510,323	)		(5,691,332	)
Total liabilities and stockholders’ deficit		18,036,886			12,930,396

(The accompanying notes are an integral part of these unaudited condensed consolidated financial statements)

2

SPECTRUM GLOBAL SOLUTIONS, INC.

Consolidated statements of operations

(Expressed in U.S. dollars)

(Unaudited)

	Three Months Ended March 31,			Three Months Ended March 31,
	2019$			2018$
Revenue		11,335,732			4,327,764
Operating expenses
Cost of revenues		8,824,165			3,784,520
Depreciation and amortization		93,952			47,833
General and administrative		1,044,708			661,298
Salaries and wages		1,358,208			577,604
Total operating expenses		11,321,033			5,071,255
Income (loss) from operations		14,699			(743,491	)
Other income (expense)
Gain on settlement of debt		164,467			561,963
Gain on extinguishment of preferred stock liability		–			287,815
Amortization of discounts on convertible debentures and notes payable		(661,352	)		(654,087	)
Gain (loss) on change in fair value of derivatives		(369,391	)		806,621
Interest expense		(471,412	)		(179,325	)
Total other income (expense)		(1,337,688	)		822,987
Net income (loss) before income taxes		(1,322,987	)		79,496
Provision for income taxes		(9,600	)		–
Net income (loss)		(1,332,587	)		79,496
Less: net loss attributable to the non-controlling interest		–			54,773
Net income (loss) attributable to Spectrum Global Solutions, Inc. common shareholders		(1,332,587	)		134,269
Net income (loss) per share attributable to Spectrum Global Solutions, Inc. common shareholders:
Basic		(0.11	)		0.06
Diluted		(0.11	)		0.03
Weighted average number of shares outstanding used in the calculation of net income (loss) attributable to Spectrum Global Solutions, Inc. per common share:
Basic		11,771,927			2,225,809
Diluted		11,771,927			8,429,006

(The accompanying notes are an integral part of these unaudited condensed consolidated financial statements)

3

SPECTRUM GLOBAL SOLUTIONS, INC.

Consolidated statements of stockholder’s deficit

For the Three Months Ended March 31, 2019 and 2018

(Unaudited)

	Common Stock				Additional paid-in			Common stock		Treasury		Accumulated			Non- controlling			Total stockholders’
	Number		Amount $		capital $			subscribed $		Stock $		deficit $			interest $			deficit $
Balance, December 31, 2017		2,115,136		21		15,909,612			74,742		–		(22,322,725	)		(88,650	)		(6,427,000	)
Shares issued upon conversion of convertible debt		188,274		2		526,367			–		–		–			–			526,369
Warrant issued to acquire non-controlling interest		–		–		(125,744	)		–		–		–			(133,254	)		(258,998	)
Shares issued for services		–		–		312,561			–		–		–			–			312,561
Net loss for the period		–		–		–			–		–		134,269			(54,773	)		79,496
Balance, March 31, 2018		2,303,410		23		16,622,796			74,742		–		(22,188,456	)		(276,677	)		(5,767,572	)

	Common Stock				Additional paid-in		Common stock		Treasury			Accumulated			Non- controlling		Total stockholders’
	Number		Amount $		capital $		subscribed $		Stock $			deficit $			interest $		deficit $
Balance, December 31, 2018		7,708,684		77		18,681,390		74,742		(277,436	)		(24,170,105	)		–		(5,691,332	)
Shares issued upon conversion of convertible debt		4,248,675		42		1,042,211		–		–			–			–		1,042,253
Shares issued for services		2,869,231		29		471,314		–		–			–			–		471,343
Net loss for the period		–		–		–		–		–			(1,332,587	)		–		(1,332,587	)
Balance, March 31, 2019		14,826,590		148		20,194,915		74,742		(277,436	)		(25,502,692	)		–		(5,510,323	)

(The accompanying notes are an integral part of these unaudited condensed consolidated financial statements) 

4

SPECTRUM GLOBAL SOLUTIONS, INC.

Consolidated statements of cash flows

(Expressed in U.S. dollars)

(Unaudited)

	Three Months Ended March 31,			Three Months Ended March 31,
	2019$			2018$
Operating activities
Net income (loss)		(1,332,587	)		79,496
Adjustments to reconcile net loss to net cash used in operating activities:
Loss (gain) on change in fair value of derivative liability		369,391			(806,621	)
Amortization of discounts on convertible debentures and notes payable		661,352			654,087
Depreciation and amortization		93,952			47,833
Amortization of  operating right of use assets		37,016			–
Foreign exchange loss (gain)		–			6,365
Shares issued for services		471,343			–
Original issue discount		20,000			–
Stock-based compensation on options and warrants		–			312,561
Derivative warrants issued for services		–			68,536
(Gain) loss on settlement of debt		(164,468	)		(561,963	)
Gain on extinguishment of preferred stock liability		–			(287,815	)
Changes in operating assets and liabilities:
Accounts receivable		(1,131,653	)		184,723
Contract assets		(365,300	)		–
Prepaid expenses and deposits		390,717			20,774
Accounts payable and accrued liabilities		961,180			(380,379	)
Other assets		3,591			5,813
Operating lease liabilities		(36,150	)		–
Contract liabilities		(523,083	)		–
Net cash used in operating activities		(544,700	)		(656,590	)
Investing activities
Net cash paid on acquisition		(941,593	)		–
Cash received on acquisition		–			191,744
Purchase of equipment		(52,540	)		(8,889	)
Net cash (used in) investing activities		(994,133	)		(182,855	)
Financing activities
Repayment of loan payable		(6,147,609	)		(386,125	)
Proceeds from notes payable		8,367,190			616,306
Proceeds from issuance of convertible debentures		–			500,000
Repayment of convertible notes		(334,552	)		–
Net cash provided by financing activities		1,885,029			730,181
Change in cash		346,197			256,446
Cash, beginning of period		620,593			28,893
Cash, end of period		996,790			285,339
Non-cash investing and financing activities:
Common stock issued for conversion of notes payable		1,042,254			92,703
Net assets acquired in TNS Acquisition		935,834			–
Convertible note issued in TNS acquisition		665,000			–
Net assets acquired in ADEX Acquisition		–			4,332,577
Warrant issued for non-controlling interest		–			133,256
Preferred stock issued to settle notes payable and accrued interest		–			439,560
Preferred stock issued to settle derivative liabilities		–			291,064
Preferred stock issued for prepaid expenses		–			13,820
Debt issuance cost		–			247,500
Original issue discounts		20,000			402,500
Third party payment of third-party debt		150,000			–
Original debt discount against derivative liability		189,000			1,487,000
Supplemental disclosures:
Interest paid		206,467			4,622
Income taxes paid		–			–

(The accompanying notes are an integral part of these unaudited consolidated financial statements)

5

SPECTRUM GLOBAL SOLUTIONS, INC.

Notes to the unaudited condensed consolidated financial statements

March 31, 2019

(Expressed in U.S. dollars) 

1. Organization and Going Concern

Spectrum Global Solutions, Inc., (the “Company”) (f/k/a Mantra Venture Group Ltd.) was incorporated in the State of Nevada on January 22, 2007 to acquire and commercially exploit various new energy related technologies through licenses and purchases. On December 8, 2008, the Company continued its corporate jurisdiction out of the State of Nevada and into the province of British Columbia, Canada. On April 25, 2017, the Company entered into and closed on an Asset Purchase Agreement with InterCloud Systems, Inc. (“InterCloud”). Pursuant to the terms of the Asset Purchase Agreement, the Company purchased 80.1% of the assets associated with InterCloud’s “AW Solutions” business. After the acquisition of AW Solutions, the Company provides professional, multi-service line, telecommunications infrastructure and outsource services to the wireless and wireline industry. On November 15, 2017, the Company changed its name to “Spectrum Global Solutions, Inc.” On February 14, 2018, the Company entered into an agreement with InterCloud providing for the sale, transfer, conveyance and delivery to the Company of the remaining 19.9% of the assets associated with InterCloud’s AWS business not already purchased by the Company.

On February 6, 2018, the Company entered into and closed on a Stock Purchase Agreement with InterCloud Systems, Inc. (“InterCloud”). Pursuant to the terms of the Stock Purchase Agreement, the Company purchased all of the issued and outstanding capital stock and membership interests of ADEX Corp. (“ADEX”). The Company closed and completed the acquisition on February 27, 2018. After the acquisition of ADEX, the Company provides professional, multi-service line, telecommunications infrastructure, outsource services and staffing solutions to the wireless and wireline industry. On May 18, 2018, the Company transferred all of its ownership interests in and to its subsidiaries Carbon Commodity Corporation, Mantra China Limited, Mantra Media Corp., Mantra NextGen Power Inc., Mantra Wind Inc., Climate ESCO Ltd. and Mantra Energy Alternatives Ltd. to an entity controlled by the Company’s former Chief Executive Officer, Larry Kristof. The new owner of the aforementioned entities assumed all liabilities and obligations with respect to such entities. On January 4, 2019, the Company closed a Stock Purchase Agreement InterCloud. Pursuant to the terms of the Purchase Agreement, InterCloud agreed to sell, and the Company agreed to purchase, all of the issued and outstanding capital stock of TNS, Inc., an Illinois corporation (“TNS”).

These consolidated financial statements have been prepared on a going concern basis, which implies the Company will continue to realize its assets and discharge its liabilities in the normal course of business. The recently acquired AW Solutions and ADEX business has also incurred losses and experienced negative cash flows from operations during its most recent fiscal years. The continuation of the Company as a going concern is dependent upon the continued financial support from its shareholders, the ability of management to raise additional equity capital through private and public offerings of its common stock, and the attainment of profitable operations. As of March 31, 2019, the Company has an accumulated deficit of $25,502,692, and a working capital deficit of $11,242,041. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern for a period of one year from the issuance of these financial statements. These consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

Management requires additional funds over the next twelve months to fully implement its business plan. Management is currently seeking additional financing through the sale of equity and from borrowings from private lenders to cover its operating expenditures. There can be no certainty that these sources will provide the additional funds required for the next twelve months. 

6

2. Significant Accounting Policies

a) Condensed financial statements

The accompanying unaudited interim consolidated financial statements of the Company should be read in conjunction with the consolidated financial statements and accompanying notes filed with the U.S. Securities and Exchange Commission in the Company’s Form 10-K for the year ended December 31, 2018. In the opinion of management, the accompanying financial statements reflect all adjustments of a recurring nature considered necessary to present fairly the Company’s financial position and the results of its operations and its cash flows for the periods shown.

The preparation of financial statements in accordance with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported. Actual results could differ materially from those estimates. The results of operations and cash flows for the periods shown are not necessarily indicative of the results to be expected for the full year.

b) Basis of Presentation/Principles of Consolidation

These consolidated financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States. These consolidated financial statements include the accounts of the Company and its subsidiaries, AW Solutions, Inc. (from the date of acquisition, April 25, 2017), Tropical Communications, Inc. (from the date of acquisition, April 25, 2017), AW Solutions Puerto Rico LLC. (from the date of acquisition, April 25, 2017), ADEX Corp., ADEX Puerto Rico, LLC and ADEXCOMM (from the date of acquisition, February 27, 2018), TNS, Inc. (from the date of acquisition, January 4, 2019). All the subsidiaries are wholly-owned. During the year ended December 31, 2018, the Company disposed of the following subsidiaries; Carbon Commodity Corporation, Climate ESCO Ltd., Mantra Energy Alternatives Ltd., Mantra China Inc., Mantra China Limited, Mantra Media Corp., Mantra NextGen Power Inc., and Mantra Wind Inc. All inter-company balances and transactions have been eliminated.

c) Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to allowance for doubtful accounts, the estimated useful lives and recoverability of long-lived assets, equity component of convertible debt, stock-based compensation, and deferred income tax asset valuation allowances. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected. 

d) Cash and Cash Equivalents

The Company considers all highly liquid instruments with maturity of three months or less at the time of issuance to be cash equivalents.

7

e) Accounts Receivable

Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The Company records unbilled receivables for services performed but not billed. Management reviews a customer’s credit history before extending credit. The Company maintains an allowance for doubtful accounts for estimated losses. Estimates of uncollectible amounts are reviewed each period, and changes are recorded in the period in which they become known. Management analyzes the collectability of accounts receivable each period. This review considers the aging of account balances, historical bad debt experience, and changes in customer creditworthiness, current economic trends, customer payment activity and other relevant factors. Should any of these factors change, the estimate made by management may also change. The allowance for doubtful accounts at March 31, 2019 and December 31, 2018 was $514,032 and $502,868, respectively.

f) Property and Equipment

Property and equipment are stated at cost. The Company depreciates the cost of property and equipment over their estimated useful lives at the following annual rates:

Automotive	3-5 years straight-line basis
Computer equipment and software	3-7 years straight-line basis
Leasehold improvements	5 years straight-line basis
Office equipment and furniture	5 years straight-line basis
Research equipment	5 years straight-line basis

g) Goodwill

Goodwill was generated through the acquisition of AW Solutions, ADEX and TNS as the total consideration paid exceeded the fair value of the net assets acquired.

The Company tests its goodwill for impairment at least annually on December 31^st and whenever events or circumstances change that indicate impairment may have occurred. A significant amount of judgment is involved in determining if an indicator of impairment has occurred. Such indicators may include, among others: a significant decline in the Company’s expected future cash flows; a significant adverse change in legal factors or in the business climate; unanticipated competition; and slower growth rates. Any adverse change in these factors could have a significant impact on the recoverability of goodwill and the Company’s consolidated financial results.

The Company tests goodwill by estimating fair value using a Discounted Cash Flow (“DCF”) model. The key assumptions used in the DCF model to determine the highest and best use of estimated future cash flows include revenue growth rates and profit margins based on internal forecasts, terminal value and an estimate of a market participant’s weighted-average cost of capital used to discount future cash flows to their present value. There were no impairment charges during the three months ended March 31, 2019.

h) Intangible Assets

At March 31, 2019 and December 31, 2018, definite-lived intangible assets primarily consist of non-compete agreements, tradenames and customer relationships which are being amortized over their estimated useful lives ranging from 3-20 years.

The Company periodically evaluates the reasonableness of the useful lives of these assets. Once these assets are fully amortized, they are removed from the accounts. These assets are reviewed for impairment or obsolescence when events or changes in circumstances indicate that the carrying amount may not be recoverable. If impaired, intangible assets are written down to fair value based on discounted cash flows or other valuation techniques. The Company has no intangibles with indefinite lives.

For long-lived assets, impairment losses are only recorded if the asset’s carrying amount is not recoverable through its undiscounted, probability-weighted future cash flows. The Company measures the impairment loss based on the difference between the carrying amount and the estimated fair value. When an impairment exists, the related assets are written down to fair value.

8

i) Long-lived Assets

In accordance with ASC 360, “Property, Plant and Equipment”, the Company tests long-lived assets or asset groups for recoverability when events or changes in circumstances indicate that their carrying amount may not be recoverable. Circumstances which could trigger a review include, but are not limited to: significant decreases in the market price of the asset; significant adverse changes in the business climate or legal factors; accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of the asset; current period cash flow or operating losses combined with a history of losses or a forecast of continuing losses associated with the use of the asset; and current expectation that the asset will more likely than not be sold or disposed significantly before the end of its estimated useful life. Recoverability is assessed based on the carrying amount of the asset and its fair value, which is generally determined based on the sum of the undiscounted cash flows expected to result from the use and the eventual disposal of the asset, as well as specific appraisal in certain instances. An impairment loss is recognized when the carrying amount is not recoverable and exceeds fair value. There were no impairment charges recorded during the three months ended March 31, 2019.

j) Foreign Currency Translation

Transactions in foreign currencies are translated into the currency of measurement at the exchange rates in effect on the transaction date. Monetary balance sheet items expressed in foreign currencies are translated into U.S. dollars at the exchange rates in effect at the balance sheet date. The resulting exchange gains and losses are recognized in income.

The Company’s integrated foreign subsidiaries are financially or operationally dependent on the Company. The Company uses the temporal method to translate the accounts of its integrated operations into U.S. dollars. Monetary assets and liabilities are translated at the exchange rates in effect at the balance sheet date. Non-monetary assets and liabilities are translated at historical rates. Revenues and expenses are translated at average rates for the period, except for amortization, which is translated on the same basis as the related asset. The resulting exchange gains or losses are recognized in income.

k) Income Taxes

The Company accounts for income taxes using the asset and liability method in accordance with ASC 740, “Accounting for Income Taxes”. The asset and liability method provides that deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities, and for operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized.

The Company conducts business, and files federal and state income, franchise or net worth, tax returns in Canada, the United States, in various states within the United States and the Commonwealth of Puerto Rico. The Company determines it’s filing obligations in a jurisdiction in accordance with existing statutory and case law. The Company may be subject to a reassessment of federal and provincial income taxes by Canadian tax authorities for a period of three years from the date of the original notice of assessment in respect of any particular taxation year. For Canadian and U.S. income tax returns, the open taxation years range from 2010 to 2018. In certain circumstances, the U.S. federal statute of limitations can reach beyond the standard three year period. U.S. state statutes of limitations for income tax assessment vary from state to state. Tax authorities of Canada and U.S. have not audited any of the Company’s, or its subsidiaries’, income tax returns for the open taxation years noted above.

Significant management judgment is required in determining the provision for income taxes, and in particular, any valuation allowance recorded against the Company’s deferred tax assets. Deferred tax assets are regularly reviewed for recoverability. The Company currently has significant deferred tax assets resulting from net operating loss carryforwards and deductible temporary differences, which should reduce taxable income in future periods. The realization of these assets is dependent on generating future taxable income.

9

The Company follows the guidance set forth within ASC Topic 740, “Income Taxes” (“ASC Topic 740”) which prescribes a two-step process for the financial statement recognition and measurement of income tax positions taken or expected to be taken in an income tax return. The first step evaluates an income tax position in order to determine whether it is more likely than not that the position will be sustained upon examination, based on the technical merits of the position. The second step measures the benefit to be recognized in the financial statements for those income tax positions that meet the more likely than not recognition threshold. ASC Topic 740 also provides guidance on de-recognition, classification, recognition and classification of interest and penalties, accounting in interim periods, disclosure and transition. Penalties and interest, if incurred, would be recorded as a component of current income tax expense.

The Company received a tax notice from the Puerto Rican government requesting payment of taxes related to 2014 in the amount of $156,711 plus penalties and interest of $111,200 for a total obligation due of $267,911. This tax assessment is included in accrued expenses at March 31, 2019.

l) Revenue Recognition

Revenue from Contracts with Customers

Adoption of New Accounting Guidance on Revenue Recognition

On May 28, 2014, FASB issues Topic 606. As of January 1, 2018, the Company adopted Topic 606 using the modified retrospective approach applied to any contracts that were not completed as of January 1, 2018. Results for reporting periods beginning after January 1, 2018 are presented under the new guidance, while prior periods continue to be reported in accordance with previous accounting guidance. The Company determined that no cumulative effect adjustment to accumulated deficit was necessary upon adoption as there were no significant revenue recognition differences identified between the new and previous accounting guidance.

The Company recognizes revenue based on the five criteria for revenue recognition established under Topic 606: 1) identify the contract, 2) identify separate performance obligations, 3) determine the transaction price, 4) allocate the transaction price among the performance obligations, and 5) recognize revenue as the performance obligations are satisfied.

Contract Types

The Company’s contracts fall under three main types: 1) unit-price, 2) fixed-price, and 3) time-and-materials. Unit-price contracts relate to services being performed and paid on a unit basis, such as per mile of construction completed. Fixed-price contracts are based on purchase order line items that are billed on individual invoices as the project progresses and milestones are reached. Time-and-materials contracts include employees working permanently at customer locations and materials costs incurred by those employees.

A significant portion of the Company’s revenues come from customers with whom the Company has a master service agreement (“MSA”). These MSA’s generally contain customer specific service requirements.

Performance Obligations

A performance obligation is a promise in a contract to transfer a distinct good or service to the customer, and is the unit of account in the new revenue standard. The contract transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. For the Company’s different revenue service types the performance obligation is satisfied at different times. For professional services revenue, the performance obligation is met when the work is performed. In certain cases this may be each day, or each week depending on the customer. For construction services, the performance obligation is met when the work is completed and the customer has approved the work. Contract assets include unbilled amounts for services performed but not yet billed. These amounts are included in accounts receivable on the consolidated balance sheets. Contract liabilities include unbilled costs and are included in accrued expenses on the consolidated balance sheets.

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Revenue Service Types

The following is a description of the Company’s revenue service types, which include professional services and construction:

● Professional services are services provided to the clients where the company delivers distinct contractual deliverables and/or services. Deliverables may include but are not be limited to: engineering drawings, designs, reports and specification. Services may include, but are not be limited to: consulting or professional staffing to support our client’s objectives. Consulting or professional staffing services may be provided remotely or on client premises and under their direction and supervision.

● Construction Services are services provided to the client where the Company may self-perform or subcontract services that require the physical construction of infrastructure or installation of equipment and materials.

Disaggregation of Revenues

The Company disaggregates its revenue from contracts with customers by service type, contract type, contract duration, and timing of transfer of goods or services. See the below tables:

Revenue by service type	Three Months Ended March 31, 2019 $		Three Months Ended March 31, 2018 $
Professional services		5,935,226		3,366,569
Construction		5,400,506		961,195
Total		11,335,732		4,327,764

Revenue by contract duration	Three Months Ended March 31, 2019 $		Three Months Ended March 31, 2018 $
Short-term		65,430		43,278
Long-term		11,270,302		4,284,486
Total		11,335,732		4,327,764

Revenue by contract type	Three Months Ended March 31, 2019 $		Three Months Ended March 31, 2018 $
Unit-price		3,238,658		710,362
Fixed-price		2,161,848		250,833
Time-and-materials		5,935,226		3,366,569
Total		11,335,732		4,327,764

The Company also disaggregates its revenue by geographic location and operating segment (See Note 13).

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Accounts Receivable

Accounts receivable include amounts from work completed in which the Company has billed. The amounts due are stated at their net estimated realizable value. The Company maintains an allowance for doubtful accounts to provide for the estimated amount of receivables that will not be collected. The allowance is based upon an assessment of customer creditworthiness, historical payment experience, the age of outstanding receivables and collateral to the extent applicable.

Contract Assets and Liabilities

Contract assets include unbilled amounts for services performed but not yet billed. These amounts are included in contract assets on the consolidated balance sheets. The Company records unbilled receivables for services performed but not billed. At March 31, 2019 and December 31, 2018, unbilled receivables totaled $2,227,195 and $1,861,895, respectively.

Contract liabilities include unbilled costs and are included in accrued expenses on the consolidated balance sheets.

m) Cost of Revenues

Cost of revenues includes all direct costs of providing services under our contracts, including costs for direct labor provided by employees, services by independent subcontractors, operation of capital equipment (excluding depreciation and amortization), direct materials, insurance claims and other direct costs.

n) Research and Development Costs

Research and development costs are expensed as incurred.

o) Stock-based Compensation

The Company records stock-based compensation in accordance with ASC 718, “Compensation – Stock Compensation”, using the fair value method. All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable.

The Company applies ASC 505-50, “Equity-Based Payments to Non-Employees” with respect to options and warrants issued to non-employees which requires the use of option valuation models to measure the fair value of the options and warrants at the measurement date.

The Company uses the Black-Scholes option pricing model to calculate the fair value of stock-based awards. This model is affected by the Company’s stock price as well as assumptions regarding a number of subjective variables. These subjective variables include, but are not limited to, the Company’s expected stock price volatility over the term of the awards, and actual and projected employee stock option exercise behaviors. The value of the portion of the award that is ultimately expected to vest is recognized as an expense in the consolidated statement of operations over the requisite service period.

p) Loss Per Share

The Company computes earnings (loss) per share in accordance with ASC 260, “Earnings per Share” which requires presentation of both basic and diluted earnings (loss) per share (“EPS”) on the face of the income statement. Basic EPS is computed by dividing the loss available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive. As of March 31, 2019, the Company had 29,135,606 (March 31, 2018 – 6,177,776) common stock equivalents outstanding.

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q) Comprehensive Loss

ASC 220, “Comprehensive Income,” establishes standards for the reporting and display of comprehensive loss and its components in the financial statements. As at December 31, 2018 and 2017 the Company has no items that represent a comprehensive loss and, therefore, has not included a schedule of comprehensive loss in the consolidated financial statements.

r) Leases

The Company adopted FASB Accounting Standards Codification, Topic 842, Leases ("ASC 842") electing the practical expedient that allows the Company not to restate its comparative periods prior to the adoption of the standard on January 1, 2019. As such, the disclosures required under ASC 842 are not presented for periods before the date of adoption. For the comparative periods prior to adoption, the Company presented the disclosures which were required under ASC 840.

The new leasing standard requires recognition of leases on the consolidated balance sheets as right-of-use ("ROU") assets and lease liabilities. ROU assets represent the Company’s right to use underlying assets for the lease terms and lease liabilities represent the Company’s obligation to make lease payments arising from the leases. Operating lease ROU assets and operating lease liabilities are recognized based on the present value and future minimum lease payments over the lease term at commencement date. As the Company’s leases do not provide an implicit rate, the Company uses its estimated incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.

The Company recognized lease liabilities, with corresponding ROU assets, based on the present value of unpaid lease payments for existing operating leases longer than twelve months as of January 1, 2019. The ROU assets were adjusted per ASC 842 transition guidance for existing lease-related balances of accrued and prepaid rent, unamortized lease incentives provided by lessors, and restructuring liabilities, Operating lease cost is recognized as a single lease cost on a straight-line basis over the lease term and is recorded in selling, general and administrative expenses. Variable lease payments for common area maintenance, property taxes and other operating expenses are recognized as expense in the period when the changes in facts and circumstances on which the variable lease payments are based occur.

s) Recent Accounting Pronouncements

On January 1, 2018, we adopted the new accounting standard ASC 606, Revenue from Contracts with Customers, and all of the related amendments (“new revenue standard”) as discussed in Revenue Recognition accounting policy description.

In February 2016, the FASB issued ASU 2016-02, Leases (“ASU 2016-02”), which, among other things, requires an entity to recognize a right-of-use asset and a lease liability on the balance sheet for substantially all leases, including operating leases. Expanded disclosures with additional qualitative and quantitative information are also required. ASU 2016-02 and its amendments are effective for interim and annual reporting periods beginning after December 15, 2018 and early adoption was permitted.

The Company adopted ASU 2016-02 and its amendments and applied the transition provisions as of January 1, 2019, which included recognizing a cumulative-effect adjustment through opening retained earnings as of that date. Prior year amounts were not recast under this transition approach and, therefore, prior year amounts are excluded from the leased properties footnote. The Company elected the package of practical expedients permitted under the transition guidance, which allowed the Company to carryforward its historical assessments of: (1) whether contracts are or contain leases, (2) lease classification and (3) initial direct costs. In addition, the Company did not elect the hindsight practical expedient to determine the reasonably certain lease term for existing leases. The Company elected a policy of not recording leases on its condensed consolidated balance sheets when the leases have a term of 12 months or less and the Company is not reasonably certain to elect an option to purchase the leased asset. The Company recognizes payments on these leases within selling, administrative and other expenses on a straight-line basis over the lease term. The standard did not materially impact consolidated net income or liquidity.

The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or result of operations

t) Concentrations of Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and accounts receivables. The Company maintains its cash balances with high-credit-quality financial institutions. Deposits held with banks may exceed the amount of insurance provided on such deposits. These deposits may be withdrawn upon demand and therefore bear minimal risk.

The Company provides credit to customers on an uncollateralized basis after evaluating client creditworthiness. For the three months ended March 31, 2019, four customers accounted for 30%, 18%, 10% and 10%, respectively, of consolidated revenues for the period. In addition, amounts due from these customers represented 30%, 20%, 7% and 5%, respectively, of trade accounts receivable as of March 31, 2019. For the three months ended March 31, 2018, two customers accounted for 22% and 18%, respectively, of consolidated revenues for the period.

The Company’s customers are primarily located within the domestic United States of America and Puerto Rico. Revenues generated within the domestic United States of America accounted for approximately 97% of consolidated revenues for the three month period ended March 31, 2019 (89% - 2018). Revenues generated from customers in Puerto Rico accounted for approximately 3% of consolidated revenues for the three month period ended March 31, 2019 (11% - 2018).

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u) Fair Value Measurements

The Company measures and discloses the estimated fair value of financial assets and liabilities using the fair value hierarchy prescribed by US generally accepted accounting principles. The fair value hierarchy has three levels, which are based on reliable available inputs of observable data. The hierarchy requires the use of observable market data when available. The three-level hierarchy is defined as follows:

Level 1 – quoted prices for identical instruments in active markets.

Level 2 – quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model derived valuations in which significant inputs and significant value drivers are observable in active markets; and.

Level 3 – fair value measurements derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

Financial instruments consist principally of cash and cash equivalents, accounts receivable, restricted cash, accounts payable, loans payable and convertible debentures. Derivative liabilities are determined based on “Level 3” inputs, which are significant and unobservable and have the lowest priority. There were no transfers into or out of “Level 3” during the three months ended March 31, 2019 and 2018. The recorded values of all other financial instruments approximate their current fair values because of their nature and respective relatively short maturity dates or durations.

Our financial assets and liabilities carried at fair value measured on a recurring basis as of December 31, 2018 and December 31, 2017, consisted of the following:

	Total fair value at March 31, 2019 $		Quoted prices in active markets (Level 1) $		Significant other observable inputs (Level 2) $		Significant unobservable inputs (Level 3) $
Description:
Derivative liability (1)		2,874,674		–		–		2,874,674

	Total fair value at December 31, 2018 $		Quoted prices in active markets (Level 1) $		Significant other observable inputs (Level 2) $		Significant unobservable inputs (Level 3) $
Description:
Derivative liability (1)		3,166,886		–		–		3,166,886

(1) The Company has estimated the fair value of these derivatives using the Monte-Carlo model and/or a Binomial Model.

Fair value estimates are made at a specific point in time, based on relevant market information and information about the financial statement. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimates. See Note 9 for additional information.

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v) Derivative Liabilities

The Company accounts for derivative instruments in accordance with ASC Topic 815, “Derivatives and Hedging” and all derivative instruments are reflected as either assets or liabilities at fair value in the balance sheet. The Company uses estimates of fair value to value its derivative instruments. Fair value is defined as the price to sell an asset or transfer a liability in an orderly transaction between willing and able market participants. In general, the Company’s policy in estimating fair values is to first look at observable market prices for identical assets and liabilities in active markets, where available. When these are not available, other inputs are used to model fair value such as prices of similar instruments, yield curves, volatilities, prepayment speeds, default rates and credit spreads, relying first on observable data from active markets. Depending on the availability of observable inputs and prices, different valuation models could produce materially different fair value estimates. The values presented may not represent future fair values and may not be realizable. The Company categorizes its fair value estimates in accordance with ASC 820 based on the hierarchical framework associated with the three levels of price transparency utilized in measuring financial instruments at fair value as discussed above. As of March 31, 2019, and December 31, 2018, the Company had a $2,784,674 and $3,166,886 derivative liability, respectively.

w) Sequencing Policy

Under ASC 815-40-35, the Company has adopted a sequencing policy whereby, in the event that reclassification of contracts from equity to assets or liabilities is necessary pursuant to ASC 815 due to the Company’s inability to demonstrate it has sufficient authorized shares as a result of certain securities with a potentially indeterminable number of shares, shares will be allocated on the basis of the earliest issuance date of potentially dilutive instruments, with the earliest grants receiving the first allocation of shares. Pursuant to ASC 815, issuance of securities to the Company’s employees or directors are not subject to the sequencing policy.

x) Reclassifications

Certain balances in previously issued consolidated financial statements have been reclassified to be consistent with the current period presentation. The reclassification had no impact on total financial position, net income, or stockholders’ equity.

3. Acquisition of TNS, Inc.

On January 4, 2019, the Company entered into a Stock Purchase Agreement (the “Purchase Agreement”) with InterCloud Systems, Inc., a Delaware corporation (“InterCloud”). Pursuant to the terms of the Purchase Agreement, InterCloud agreed to sell, and the Company agreed to purchase, all of the issued and outstanding capital stock of TNS, Inc., an Illinois corporation (“TNS”). The Company closed and completed the acquisition on January 4, 2019.

The purchase price paid by the Company for the includes $980,000 in cash, paid at closing, and the issuance to InterCloud of a convertible promissory note in the aggregate principal amount of $620,000 (the “Note”).

The Company has performed a valuation analysis of the fair market value of TNS’ assets and liabilities. The provisional fair value of the purchase consideration issued to the sellers of TNS was allocated to the net tangible assets acquired. We accounted for the acquisition of TNS as the purchase of a business under GAAP under the acquisition method of accounting, the assets and liabilities acquired were recorded as of the acquisition date, at their respective fair values and consolidated with those of our company. The excess of the aggregate fair value of the net tangible assets has been allocated to an intangible asset, value of customer accounts and the remainder to goodwill. The purchase price allocation was based, in part, on management’s knowledge of TNS' business and is preliminary. Once we complete our analysis to finalize the purchase price allocation, which includes finalizing the valuation report from a third-party appraiser and a review of potential intangible assets, it is reasonably possible that, there could be significant changes to the preliminary values below.

The following table summarizes the allocation of the preliminary purchase price as of the acquisition date:

Provisional Purchase Consideration
$620,000 Convertible Note	$	665,000
Cash		980,000
Total Purchase Price	$	1,645,000
Preliminary Allocation of Purchase Price
Cash	$	38,407
Accounts receivable, net		65,166
Prepaid expenses		630,810
Customer lists *		1,800,000
Tradenames *		300,000
Goodwill *		670,759
Accounts payable		(275,331	)
Accrued expenses		(611,778	)
Contract liabilities		(973,033	)
Net assets acquired	$	1,645,000

* The Company is reviewing for potential identifiable intangible assets, which may potentially change the value allocated to intangible assets.

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The following table summarizes our consolidated results of operations for the year ended December 31, 2018, as well as unaudited pro forma consolidated results of operations as though the acquisition had occurred on January 1, 2018:

	March 31, 2019 $						March 31, 2018 $
	As Reported			Pro Forma			As Reported		Pro Forma
Net Sales		11,335,732			11,335,732			4,327,764		8,259,398
Net Loss		(1,332,587	)		(1,340,141	)		134,269		1,243,947
Earnings per common share:
Basic		(0.11	)		(0.11	)		0.06		0.56
Diluted		(0.11	)		(0.11	)		0.03		0.16

4. Property and Equipment

	March 31, 2019 $			December 31, 2018 $
Computers and office equipment		331,987			329,937
Equipment		382,140			382,140
Research equipment		143,129			143,129
Software		227,563			177,073
Vehicles		94,356			94,356
Vehicles under capital lease		–			–
Total		1,179,175			1,126,635
Less: impairment		(44,419	)		(44,419	)
Less: accumulated depreciation		(1,027,977	)		(1,020,959	)
Equipment, Net		106,779			61,257

During the three months ended March 31, 2019, the Company recorded $7,018 (2018 - $4,395) of depreciation expense.

5. Intangible Assets

	Cost $		Accumulated amortization $		Impairment $		March 31, 2019 Net carrying value $		December 31, 2018 Net carrying value $
Customer relationship and lists		2,837,548		249,121		–		2,588,427		850,249
Trade names		1,505,605		143,922		–		1,361,683		1,086,795
		4,343,153		393,043		–		3,950,110		1,937,044

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During the three months ended March 31, 2019, the Company recorded $86,934 (March 31, 2018 - $43,438) of amortization.

Estimated Future Amortization Expense:

	$
For year ending December 31, 2019		260,453
For year ending December 31, 2020		347,387
For year ending December 31, 2021		347,387
For year ending December 31, 2022		347,387
For year ending December 31, 2023 to December 31, 2027		2,647,496
Total		3,950,110

6. Related Party Transactions

a) As at March 31, 2019, the Company owes $50,577 (December 31, 2018 - $51,889) to InterCloud, which is non-interest bearing, unsecured, and due on demand and included in accounts payable and accrued liabilities.

b) On November 30, 2017, the Company received $18,858 pursuant to a promissory note issued to the Chief Executive Officer of the Company. The note issued was unsecured, due on November 30, 2018 and bears interest at a rate of 8% per annum. On November 30, 2018, the lender agreed to extend the maturity of the loan to November 30, 2019.  The Company accounted for the modification in accordance with ASC 470-50 “Modifications and Extinguishments”. In accordance with ASC 470-50, the Company accounted for the extension as a modification and no gain or loss was recognized.

c) On November 30, 2017, the Company received $130,000 pursuant to a promissory note issued to the President of the Company. The note issued is unsecured, due on November 30, 2018 and bears interest at a rate of 8% per annum. On November 30, 2018, the lender agreed to extend the maturity of the loan to November 30, 2019. The Company accounted for the modification in accordance with ASC 470-50 “Modifications and Extinguishments”. In accordance with ASC 470-50, the Company accounted for the extension as a modification and no gain or loss was recognized.

d) On April 13, 2018, the Company received $85,000 pursuant to a promissory note issued to the President of the Company. The note issued is unsecured, due on April 13, 2019 and bears interest at a rate of 8% per annum. At December 31, 2018, the amount of $85,000 was owed. On April 20, 2019, the note was amended with to a maturity date of April 20, 2020 and an interest rate of 10%.

e) On April 23, 2018, each of Roger Ponder, the Company’s Chief Executive Officer, and Keith Hayter, the Company’s President, exchanged certain shares of common stock of the Company held by each of them for shares of the newly designated Series B Preferred Stock. Mr. Ponder exchanged 542,500 shares of common stock for an aggregate of 500 shares of Series B Preferred Stock, and Mr. Hayter exchanged 542,500 shares of common stock for an aggregate of 500 shares of Series B Preferred Stock.  The Company recorded the fair value of the Series B Preferred Stock of $484,530 as mezzanine equity and reduced common shares and additional paid in capital an equal amount.

f) On August 21, 2018, the Company received $80,000 pursuant to a promissory note issued to the President of the Company. The note issued is unsecured, due on August 20, 2019 and bears interest at a rate of 8% per annum. At March 31, 2019 and December 31, 2018, the amount of $80,000 was owed,

g) On June 1, 2018, the Company entered into an employment agreement with the Chief Executive Officer of the Company. The agreement has a three year term and provides for base compensation of $350,000 per year as well as bonuses including stock options.

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h) On June 1, 2018, the Company entered into an employment agreement with the President of the Company. The agreement has a three year term and provides for base compensation of $340,000 per year as well as bonuses including stock options.

	March 31, 2019		December 31, 2018
Promissory note issued to Roger Ponder, 10% interest, unsecured, matured on November 30, 2018 and extended to November 30, 2019	$	18,858	$	18,858
Promissory note issued to Keith Hayter, 10% interest, unsecured, matured on November 30, 2018 and extended to November 30, 2019		130,000		130,000
Promissory note issued to Keith Hayter, 8% interest, unsecured, matures April 10, 2019		85,000		85,000
Promissory note issued to Keith Hayter, 8% interest, unsecured, matures August 20, 2019		80,000		80,000
Total	$	313,858	$	313,858

7. Loans Payable

a) As of March 31, 2019, the amount of $49,121 (Cdn$63,300) (December 31, 2018 - $49,121 (Cdn$63,300)) is owed to a non-related party which is non-interest bearing, unsecured, and due on demand.

b) As at March 31, 2019, the amount of $15,000 (December 31, 2018 - $15,000) is owed to non-related parties which is non-interest bearing, unsecured, and due on demand.

c) As of March 31, 2019, the amounts of $7,500 and $2,636 (Cdn$3,400) (December 31, 2018 - $7,500 and $2,636 (Cdn$3,400)) are owed to a non-related party which are non-interest bearing, unsecured, and due on demand.

d) In March 2012, the Company received $50,000 for the subscription of 10,000,000 shares of the Company’s common stock. During the year ended May 31, 2013, the Company and the subscriber agreed that the shares would not be issued and that the subscription would be returned. The subscription has been reclassified as a non-interest bearing demand loan until the funds are refunded to the subscriber.

e) On August 4, 2015, the Company borrowed $50,000 pursuant to a promissory note. The note was due on September 4, 2015. The note bears interest at 120% per annum prior September 4, 2015, and at 180% per annum after September 4, 2015. The holder of the note was also granted the rights to buy 500 shares of the Company’s common stock at a price of $30 per share until August 4, 2017. During the year ended May 31, 2016, the Company repaid the $50,000 note and $1,200 of accrued interest remains owing. At March 31, 2019, and December 31, 2018, $1,200 of accrued interest remained owing.

f) On April 12, 2017, received $12,000 pursuant to a promissory note. The note issued is unsecured, due on demand and bears interest at a rate of 10% per annum. At March 31, 2019 and December 31, 2018, the amount of $12,000 was owed.

g) On October 10, 2018, the Company’s wholly-owned subsidiary, ADEX Corporation (the “Borrower”), entered into a Loan and Security Agreement (the “Loan and Security Agreement”) with Heritage Bank of Commerce (the “Lender”). Under the Loan and Security Agreement, the Borrower may borrow an aggregate outstanding amount not to exceed the lesser of up to (i) $5,000,000 or (ii) the Borrowing Base (as defined in the Loan and Security Agreement) through one or more advances through October 10, 2020 (the “Maturity Date”), subject to the Lender’s satisfactory annual review of the Borrower on or around October 10, 2019. On the Maturity Date, all advances must be repaid. The Lender may, in its sole discretion and upon the Borrower’s request, make advances to the Borrower after the Maturity Date subject to the terms and conditions under the Loan and Security Agreement. Part of the proceeds of the initial credit extension of the Loan and Security Agreement were used to pay off borrowings owed to Prestige Capital Corporation described in Note 9(l).

Interest is payable under the Loan and Security Agreement at a per annum rate equal to the Prime Rate (as defined in the Loan and Security Agreement) plus 2%. The Borrower’s obligations under the Loan and Security Agreement are secured by all assets of the Company and ADEX Puerto Rico LLC. In addition, the Company issued a warrant (the “Warrant”) to the Lender to purchase an amount of shares of the Company’s common stock equal to $150,000 divided by the Warrant Price (as defined in the Warrant) at a price per share equal to 125% of the prior day’s closing price.

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The Loan and Security Agreement provides that upon the occurrence of an event of default, among other things, all outstanding amounts under the Loan and Security Agreement or any portion thereof becomes immediately due and payable. Events of default under the Loan and Security Agreement include, among other items, the Borrower’s failure to comply with certain affirmative and negative covenants relating to the Company, its securities and its financial condition.

In connection with the financing, on October 10, 2018, the Company also issued a warrant to purchase 113,953 shares of the Company’s common stock at $1.25 per share for three years. The fair value of the warrants of $87,410 and $190,000 of debt issuance costs resulted in a discount to the note payable of $277,410. At December 31, 2018, the Company owed $3,483,015 pursuant to this agreement and will record accretion equal to the debt discount of $257,194 over the remaining term of the note. At during the three months ended March 31, 2019 the Company borrowed an additional $1,063,686 and recorded accretion of $108,014. At March 31, 2019, the Company owed $4,546,701 pursuant to this agreement and will record accretion equal to the debt discount of $149,180 over the remaining term of the note.

h) On January 4, 2019, the “Company, together with its subsidiaries, AW Solutions, Inc., AW Solutions Puerto Rico, LLC, Tropical Communications, Inc., ADEX Corp., ADEX Puerto Rico, LLC, and Telnet Solutions, Inc (collectively with the Company, the “Financing Parties”), entered into an Agreement of Sale of Future Receipts (the “Financing Agreement”) with Libertas Funding LLC, a Connecticut limited liability company (“Libertas”). Under the Financing Agreement, the Financing Parties sold to Libertas future receivables in an aggregate amount equal to $1,460,000 for a purchase price of $1,000,000.

Pursuant to the terms of the Financing Agreement, the Company agreed to pay Libertas $31,602 each week based upon an anticipated 20% of its future receivables until such time as $1,460,000 has been paid, a period Libertas and the Financing Parties estimated to be approximately eleven months. In the event that the Financing Agreement is paid off earlier than eleven months, there is a discount to the sum owed. The Financing Agreement also contains customary affirmative and negative covenants, representations and warranties, and default and termination provisions. The Company used the proceeds of the Financing Agreement for the acquisition of TNS, as discussed in Note 3.

On February 1, 2019, the Company fully repaid the Financing Agreement.

i) At March 31, 2019, the Company owed $1,325,895 to WaveTech Global Inc. (“WaveTech”) pursuant to the Share Purchase Agreement described in Note 14. If the acquisition described does not close the advance has a term of 60 days and bears interest at 12%.

	March 31, 2019		December 31, 2018
Promissory note issued to J. Thacker, non-interest bearing, unsecured and due on demand	$	41,361	$	41,361
Promissory note issued to S. Kahn, non-interest bearing, unsecured and due on demand	$	7,760	$	7,760
Promissory note issued to 0738856 BC Ltd, non-interest bearing, unsecured and due on demand		15,000		15,000
Promissory note issued to Bluekey Energy, non-interest bearing, unsecured and due on demand		7,500		7,500
Promissory note issued to 0738856 BC ltd non-interest bearing, unsecured and due on demand		2,636		2,636
Subscription amount due to T. Warkentin non-interest bearing, unsecured and due on demand		50,000		50,000
Promissory note issued to Old Main Capital LLC, 8% interest, unsecured and due on demand		12,000		12,000
Promissory note issued to InterCloud Systems, Inc., non-interest bearing, unsecured and due on demand		275,000		275,000
Loan with Heritage Bank of Commerce, interest rate of prime plus 2%, secured by all assets of the Company, matures October 20, 2020, net of debt discount of $149,180 and $257,194		4,397,521		3,225,821
Loan with WaveTech Global, Inc., interest rate of 12%,  matured April 28, 2019		1,325,895		-
Total	$	6,134,673	$	3,637,078

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8. Convertible Debentures

a) On April 27, 2017, the Company issued a convertible promissory note in the aggregate principal amount of $2,000,000. The interest on the outstanding principal due under the Unsecured Note accrues at a rate of 8% per annum. All principal and accrued interest under the Unsecured Note is due one year following the issue date of the Unsecured Note and is convertible into shares of common stock at a conversion price equal to 75% of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion.     

The embedded conversion option qualifies for derivative accounting and bifurcation under ASC 815-15 “Derivatives and Hedging”. The initial fair value of the conversion feature of $1,174,000 resulted in a discount to the note payable of $943,299. On December 15, 2017, February 14, 2018, February 21, 2018, June 7, 2018, January 24, 2019, and March 15, 2019 the holder of the convertible promissory note entered into agreement to sell and assign a total of $105,000, $105,000, $105,000, $39,375, $100,000 and $100,000 of the outstanding principal, respectively to a third party. The Company approved and is bound by the assignment and sale agreement. As a result of the assignment, the conversion price for the total of $354,375 of notes assigned is now equal to the lesser 70% of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion and $8. The Company accounted for this assignment in accordance with ASC 470-50 “Modifications and Extinguishments”. In accordance with ASC 470-50, the Company accounted for the assignment as a debt extinguishment and adjusted the fair value of the derivative to its fair value on the assignment date. During the year ended December 31, 2018, the entire December 15, 2017 note of $105,000, the entire February 14, 2018 note of $105,000 and $55,000 of the February 21, 2018 $105,000 note was converted into 661,795 shares of common stock. The February 21, 2018, June 7, 2018, notes are described in Notes 8(b), and (c) respectively. The January 24, 2019 and March 15, 2019 assignments are described in Note 8(d). At March 31, 2019, the carrying value of the notes was $1,445,625,

b) On February 21, 2018, the holder of the convertible promissory note described in Note 8(a) entered into agreements to sell and assign a total of $105,000, of the outstanding principal to a third party. During the year ended December 31, 2018, $55,000 of the note was converted. During the three months ended March 31, 2019, $44,250 of the note was converted into 583,156 shares of common stock. At March 31, 2019, the carrying value of the notes was $5,750.

c) On June 7, 2018, the holder of the convertible promissory note described in Note 8(a) entered into agreements to sell and assign a total of $39,375, of the outstanding principal to a third party. During the three months ended March 31, 2019, $39,375 of the note was converted into 576,501 shares of common stock. At March 31, 2019, the carrying value of the notes was $Nil.

d) On January 24, 2019 and March 15, 2019, the holder of the convertible promissory note described in Note 8(a) entered into agreements to sell and assign a total of $200,000, of the outstanding principal to a third party. During the three months ended March 31, 2019, $75,000 and $7,499 of the note was converted into 1,071,418 shares of common stock. At March 31, 2019, the carrying value of the notes was $25,000.  

e) On February 27, 2018, the Company issued a convertible promissory note in the aggregate principal amount of $2,000,000. The interest on the outstanding principal due under the ADEX Note accrues at a rate of 6% per annum. All principal and accrued interest under the ADEX Note is due one year following the issue date of the ADEX Note and is convertible into shares of common stock at a conversion price equal to of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion, but in no event ever lower than $1 (the “Floor”), unless the note is in default, at which time the Floor terminates. 

The embedded conversion option qualifies for derivative accounting and bifurcation under ASC 815-15 “Derivatives and Hedging”. The initial fair value of the conversion feature of $2,455,000 resulted in a discount to the note payable of $639,000.

On September 26, 2018, the holder of the convertible promissory note entered into agreement to sell and assign a total of $75,000 of the outstanding principal to a third party. The Company approved and is bound by the assignment and sale agreement. As a result of the assignment, the assigned note bears interest at 5% and the conversion price for the $75,000 of notes assigned is now equal to the lesser 75% of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion and $8. On December 3, 2018, the holder of the convertible promissory note entered into agreement to sell and assign a total of $50,000 of the outstanding principal to a third party. The Company accounted for the assignments in accordance with ASC 470-50 “Modifications and Extinguishments”. In accordance with ASC 470-50, the Company accounted for the assignment as a debt extinguishment and adjusted the fair value of the derivative to its fair value on the assignment date. During the year ended December 31, 2018, $74,993 of the note was converted into 321,500 shares of common stock. During the year ended December 31, 2018, the Company recorded accretion of $352,251 increasing the carrying value of the notes to $1,565,681.

During the three months ended March 31, 2019, $49,995 of the note was converted into 617,600 shares of common stock. During the three months ended March 31, 2019, the Company repaid $45,077 and recorded accretion of $125,967 increasing the carrying value of the notes to $1,596,577.

f) The Company also issued InterCloud a convertible note with a principal amount of $793,894 to settle a contingent liability of $793,893 owed as a result of the acquisition of AWS. The note is due on August 16, 2019 and bears interest at 1% per annum. The note is convertible into common shares of the Company at a conversion price equal to the 80% of the lowest volume-weighted average price during the 5 trading days immediately preceding the date of conversion.

The embedded conversion option qualifies for derivative accounting and bifurcation under ASC 815-15 “Derivatives and Hedging”. The initial fair value of the conversion feature of $348,000 resulted in a discount to the note payable of $348,000. During the three months ended March 31, 2019, the Company recorded accretion of $62,466 increasing the carrying value of the notes to $684,858.

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g) On February 21, 2018, the Company issued a convertible note with a principal amount of $500,000 and a warrant with a term of three years to purchase up to 125,000 shares of common stock of the Company at an exercise price of $1.60 per share. The exercise price of the warrant will reduce to 85% of the closing price of the Company’s common stock if the closing price of the Company’s common stock is less than $1.60 on July 31, 2018. The note was due on January 15, 2019, and in February 2019, the maturity date was extended to June 1, 2019, and bears interest at 6% per annum. The note is convertible into common shares of the Company at a conversion price equal to the lower of 80% of the lowest volume-weighted average price during the 5 trading days immediately preceding the date of conversion and $1 (the “Floor”), unless the note is in default, at which time the Floor terminates.

The embedded conversion option and warrant qualified for derivative accounting and the conversion option qualified for bifurcation under ASC 815-15 “Derivatives and Hedging”. The initial fair value of the conversion feature of $571,079 and the warrant of $158,772 resulted in a discount to the note payable of $500,000 and an initial derivative expense of $229,851. During the three months ended March 31, 2019, the Company recorded accretion of $55,000 increasing the carrying value of the notes to $500,000.

h) On April 23, 2018, the Company entered into and closed on a Securities Purchase Agreement with an institutional investor, pursuant to which the Company issued to the lender a senior secured convertible promissory note in the aggregate principal amount of $1,578,947 for an aggregate purchase price of $1,500,000.

The interest on the outstanding principal due under the secured note accrues at a rate of 12% per annum. All principal and accrued interest under the secured note is due on October 23, 2019 and is convertible into shares of the Company’s common stock at a fixed conversion price of $1.00. While during the first three months that the secured note is outstanding, only interest payments are due to the lender, beginning in month four, and on each monthly anniversary thereafter until maturity, amortization payments are due for principal and interest due under the secured note. The secured note includes customary events of default, including non-payment of the principal or accrued interest due on the secured note. Upon an event of default, all obligations under the secured note will become immediately due and payable.

If the Company issues any common stock or common stock equivalents at an effective price per share less than $1 then the conversion price of the note will be reduced to the lower price. As long as the note is not in default the Company may repay the note at 110% of the outstanding principal amount. If the Company defaults upon the note it bears interest at 18% per annum.

In connection with the Purchase Agreement, the Company entered into a security agreement, dated as of April 23, 2018, with the Lender (the “Security Agreement”) and an intellectual property security agreement, dated as of April 23, 2018, with the Lender pursuant to which the Company granted a security interest in substantially all of the assets of the Company, but for those assets over which Prestige Capital Corporation holds a lien, to secure the Company’s obligations under the secured note. In addition, all of the Company’s subsidiaries are guarantors of the Company’s obligations to the Lender pursuant to the Secured Note.

The embedded conversion option qualified for derivative accounting and the conversion option qualified for bifurcation under ASC 815-15 “Derivatives and Hedging”. The initial fair value of the conversion feature of $3,325,000 resulted in a discount to the note payable of $1,500,000 and an initial derivative expense of $1,825,000. During the three months ended March 31, 2019, the Company repaid $131,579 of the note which resulted in a $72,000 gain on the extinguishment of the note and associated derivative liability. During the three months ended March 31, 2019, the Company recorded accretion of $130,500 increasing the carrying value of the notes to $239,291

i) On May 18, 2018, the Company entered into and closed on a Securities Purchase Agreement with an institutional investor, pursuant to which the Company issued to the investor a senior secured convertible promissory note in the aggregate principal amount of $295,746 for an aggregate purchase price of $280,959.

The interest on the outstanding principal due under the secured note accrues at a rate of 12% per annum. All principal and accrued but unpaid interest under the secured note is due on May 18, 2019. The secured note is convertible into shares of the Company’s common stock at a fixed conversion price of $1 per share. Interest is payable monthly on the 18th of each month. While interest payments must be made in cash during the first six months that the secured note is outstanding, beginning in month seven, and on each monthly anniversary thereafter until maturity, the Company has the option to pay interest payments in stock, subject to certain equity conditions being satisfied. Any payment of interest or principal scheduled after December 1, 2018 that is made in cash will be subject to a 5% prepayment premium. Any other prepayment is subject to a 10% premium. The secured note includes customary events of default, including non-payment of the principal or accrued interest due on the secured note and cross default to other notes owing to the investor. Upon an event of default, all obligations under the secured note and other notes owing to the investor will become immediately due and payable. In connection with the issuance of the secured note, the Company issued the investor 496,101 shares of Series A Preferred Stock with a fair value of $193,509 which was expensed. The investor was granted a right to participate in future financing transactions of the Company while the secured note remains outstanding.

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If the Company issues any common stock or common stock equivalents at an effective price per share less than $1 then the conversion price of the note will be reduced to the lower price. As long as the note is not in default the Company may repay the note at 110% of the outstanding principal amount. If the Company defaults upon the note it bears interest at 18% per annum.

In connection with the Securities Purchase Agreement, the Company entered into an amendment to the existing Security Agreement described in Note 10(o). Pursuant to the amendment, the Company agreed that obligations under the secured note and related documents will be secured pursuant to the existing security interest in substantially all of the assets of the Company securing other notes issued to the Investor (except for those assets over which Prestige Capital Corporation holds a lien). In addition, all of the Company’s subsidiaries are guarantors of the Company’s obligations to the Investor pursuant to the Secured Note and have granted a similar security interest over substantially their assets.

The embedded conversion option qualified for derivative accounting and the conversion option qualified for bifurcation under ASC 815-15 “Derivatives and Hedging”. The initial fair value of the conversion feature of $468,000 resulted in a discount to the note payable of $280,959 and an initial derivative expense of $187,041. During the three months ended March 31, 2019, the Company recorded accretion of $89,783 increasing the carrying value of the notes to $212,959.

j) On July 3, 2018, the Company entered into and closed on a Securities Purchase Agreement with an institutional investor, pursuant to which the Company issued to the investor a senior secured convertible promissory note in the aggregate principal amount of $78,947 for an aggregate purchase price of $75,000.

The interest on the outstanding principal due under the secured note accrues at a rate of 12% per annum. All principal and accrued but unpaid interest under the secured note is due on March 15, 2019. The secured note is convertible into shares of the Company’s at the greater of $0.80 or 75% of the lowest VWAP in the 10 trading days prior to conversion.

The Company may repay the note at 115% of the outstanding principal amount. If the Company defaults upon the note it bears interest at 18% per annum.

The embedded conversion option qualified for derivative accounting and the conversion option qualified for bifurcation under ASC 815-15 “Derivatives and Hedging”. The initial fair value of the conversion feature of $23,000 resulted in a discount to the note payable of $23,000. During the year ended December 31, 2018, the Company recorded accretion of $17,860 increasing the carrying value of the notes to $69,860. During the three months ended March 31, 2019, the Company repaid the note in full and recognized a loss on settlement of debt of $2,300.

k) On July 31, 2018, the Company entered into and closed on a Securities Purchase Agreement with an institutional investor, pursuant to which the Company issued to the investor a senior secured convertible promissory note in the aggregate principal amount of $78,947 for an aggregate purchase price of $75,000.

The interest on the outstanding principal due under the secured note accrues at a rate of 12% per annum. All principal and accrued but unpaid interest under the secured note is due on March 15, 2019. The secured note is convertible into shares of the Company’s at the greater of $1 or 75% of the lowest VWAP in the 10 trading days prior to conversion.

The Company may repay the note at 115% of the outstanding principal amount. If the Company defaults upon the note it bears interest at 18% per annum.

The embedded conversion option qualified for derivative accounting and the conversion option qualified for bifurcation under ASC 815-15 “Derivatives and Hedging”. The initial fair value of the conversion feature of $103,000 resulted in a discount to the note payable of $75,000 and an initial derivative expense of $28,000. During the year ended December 31, 2018, the Company recorded accretion of $37,554 increasing the carrying value of the notes to $37,554. During the three months ended March 31, 2019, the Company repaid the note in full and recognized a loss on settlement of debt of $90,000.

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l) On December 4, 2018, the Company entered into and closed on a Securities Purchase Agreement with an institutional investor, pursuant to which the Company issued to the investor a senior secured convertible promissory note in the aggregate principal amount of $27,500 for an aggregate purchase price of $25,000.

The interest on the outstanding principal due under the secured note accrues at a rate of 8% per annum. All principal and accrued but unpaid interest under the secured note is due on December 4, 2019. The secured note is convertible into shares of the Company’s at 65% of lowest trading price for the fifteen trading days prior to the conversion date.

The Company may repay the note at 150% of the outstanding principal amount. If the Company defaults upon the note it bears interest at 18% per annum.

The embedded conversion option qualified for derivative accounting and the conversion option qualified for bifurcation under ASC 815-15 “Derivatives and Hedging”. The initial fair value of the conversion feature of $30,000 resulted in a discount to the note payable of $25,000 and an initial derivative expense of $5,000. During the three months ended March 31, 2019, the Company recorded accretion of $2,484 increasing the carrying value of the notes to $5,844. 

m) On January 4, 2019, as part of the acquisition described in Note 3, the Company issued to InterCloud a convertible promissory note in the aggregate principal amount of $620,000 (the “Note”). 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 Company 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.

The embedded conversion option qualifies for derivative accounting and bifurcation under ASC 815-15 “Derivatives and Hedging”. The initial fair value of the conversion feature of $189,000 resulted in a discount to the note payable of $144,000.

On January 28, 2019, the holder of the convertible promissory note entered into agreement to sell and assign a total of $620,000 of the $620,000 outstanding principal to two third parties, with $186,000 and $434,000 of principal assigned to each party. The Company approved and is bound by the assignment and sale agreement. During the three months ended March 31, 2019, $70,000 of each of the notes was converted into a total of 1,400,000 shares of common stock. During the three months ended March 31, 2019, the Company recorded accretion of $13,011 and $23,645 on the two notes increasing the carrying value of the two notes to $85,844 and $286,845 respectively.

	March 31, 2019		December 31, 2018
Convertible promissory note, InterCloud Systems, Inc,, 8% interest, unsecured, matured April 27, 2018, net of debt discount of $0 and $361,333	$	1,445,625	$	1,735,000
Convertible promissory note, InterCloud Systems, Inc,, 6% interest, unsecured, matured March 27, 2019, net of debt discount of $160,782 and $286,749		1,596,542		1,565,681
Convertible promissory note, InterCloud Systems, Inc,, 1% interest, unsecured, matures August 16, 2019, net of debt discount of $109,036 and $171,557		684,858		622,392
Convertible promissory note, Barn 11, 6% interest, unsecured, matures June 1, 2019, net of debt discount of $0 and $45,000		500,000		445,000
Convertible promissory note, Dominion Capital, 18% interest, secured, matures October 23,2019, net of debt discount of $879,130 and $1,009,630		239,291		240,370
Convertible promissory note, Dominion Capital, 12% interest, unsecured, matures May 18, 2019, net of debt discount of $82,787 and $172,570		212,959		123,176
Convertible promissory note, M2B Funding, 12% interest, unsecured, matures March 15, 2019, net of debt discount of $0 and $9,087		-		69,860
Convertible promissory note, M2B Funding, 12% interest, unsecured, matures March 15, 2019, net of debt discount of $0 and $41,395		-		37,552
Convertible promissory note, Silverback, 8% interest, unsecured, matures December 4, 2019, net of debt discount of $21,656 and $24,140		5,844		3,360
Convertible promissory note, Michael Roeske, 6% interest, unsecured, matures, January 30, 2020, net of debt discount of $30,189 and $0		85,844		-
Convertible promissory note, Joel Raven, 6% interest, unsecured, matures January 30, 2020, net of debt discount of $77,155 and $0		286,845		-
Convertible promissory note, Virtual Capital, LLC, 0% interest, unsecured, matured, January 24, 2019		125,000
Convertible promissory note, RDW Capital LLC, 9.9% interest, unsecured, matured March 30, 2019, net of debt discount of $0 and $0		5,750		-
Total	$	5,188,558	$	4,842,391

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9. Derivative Liabilities

The embedded conversion option of the convertible debenture described in Note 8 contain conversion features that qualify for embedded derivative classification. The fair value of the liability will be re-measured at the end of every reporting period and the change in fair value will be reported in the statement of operations as a gain or loss on derivative financial instruments.

Upon the issuance of the convertible note payable described in Note 8, the Company concluded that it only has sufficient shares to satisfy the conversion of some but not all of the outstanding convertible notes, warrants and options. The Company elected to reclassify contracts from equity with the earliest inception date first. As a result, none of the Company’s previously outstanding convertible instruments qualified for derivative reclassification, however, any convertible securities issued after the election qualified for derivative classification. The Company reassesses the classification of the instruments at each balance sheet date. If the classification changes as a result of events during the period, the contract is reclassified as of the date of the event that caused the reclassification.

The table below sets forth a summary of changes in the fair value of the Company’s Level 3 financial liabilities.

	March 31, 2019			December 31, 2018
Balance at the beginning of period	$	3,166,886		$	4,749,712
Derivative issued as part of acquisition		-			302,800
Original discount limited to proceeds of notes		189,000			2,839,369
Fair value of derivative liabilities in excess of notes proceeds received		-			2,274,892
Derivative warrants issued for services and to acquire non-controlling interest		-			328,833
Derivative liability settled through the issuance of preferred stock		-			(291,064	)
Conversion of derivative liability		(686,135	)		(678,142	)
Repayment of convertible note		(164,468	)		(310,041	)
Change in fair value of embedded conversion option		369,391			(6,049,473	)
Balance at the end of the period	$	2,874,674		$	3,166,886

The Company uses Level 3 inputs for its valuation methodology for the embedded conversion option liabilities as their fair values were determined by using Monte-Carlo model or a Binomial Model based on various assumptions. 

Significant changes in any of these inputs in isolation would result in a significant change in the fair value measurement. As required, these are classified based on the lowest level of input that is significant to the fair value measurement. The following table shows the assumptions used in the calculations:

	Expected Volatility			Risk-free Interest Rate			Expected Dividend Yield			Expected Life (in years)
At issuance		204	%		2.57	%		0	%		1.07
At December 31, 2018		172-381	%		2.45-2.63	%		0	%		0.04-2.78
At March 31, 2019		215-386	%		2.27-2.44	%		0	%		0.25-2.53

10. Common Stock

On November 15, 2017, the Company revised its authorized share capital to increase the number of authorized common shares from 275,000,000 common shares with a par value of $0.00001, to 750,000,000 common shares with a par value of $0.00001.

Treasury stock- The Company holds 621,258 shares in treasury at a cost of $277,436.

a) As at December 31, 2017 and May 31, 2017, the Company’s subsidiary, Mantra Energy Alternatives Ltd., had received subscriptions for 335 shares of common stock at Cdn$1.00 per share for proceeds of $66,277 (Cdn$67,000), which is included in common stock subscribed, net of the non-controlling interest portion of $7,231.

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b) As at December 31, 2017 and May 31, 2017, the Company’s subsidiary, Climate ESCO Ltd., had received subscriptions for 1,050 shares of common stock at $0.10 per share for proceeds of $21,000, which is included in common stock subscribed, net of the non-controlling interest portion of $7,384.

c) On September 28, 2018, the Company issued 5,010,000 shares of common stock with a fair value of $3,256,500 to employees of the Company in exchange for services for the Company. The shares vest over 36 months. During the period ended March 31, 2019, the Company recorded $422,988 for the vested portion of the shares, leaving $2,228,508 of unvested compensation expense to be recognized in future periods.

d) On October 9, 2018, the Company issued 520,000 shares of common stock with a fair value of $520,000 to employees of the Company in exchange for services for the Company. The shares vest over 36 months. During the period ended March 31, 2019, the Company recorded $34,395 for the vested portion of the shares, leaving $429,512 of unvested compensation expense to be recognized in future periods

e) On January 14, 2019, the Company issued 100,000 shares of common stock upon the conversion of $9,746 of principal pursuant to the loan described in Note 8(e).

f) On January 14, 2019, the Company issued 110,742 shares of common stock upon the conversion of $10,000 of principal pursuant to the loan described in Note 8(b).

g) On January 28, 2019, the Company issued 200,000 shares of common stock upon the conversion of $15,552 of principal pursuant to the loan described in Note 8(e).

h) On February 1, 2019, the Company issued 2,869,230 shares of common stock to employees and directors of the Company in exchange for services for the Company. The shares vest over periods between 11 and 36 months. During the quarter ended March 31361,490 of unvested compensation expense to be recognized in future periods

i) On February 7, 2019, the holder of the assigned note converted $75,000 of the note and $7,499 of interest into 1,071,418 shares of the Company’s common stock.

j) On February 7, 2019, the Company issued 172,414 shares of common stock upon the conversion of $12,500 of principal pursuant to the loan described in Note 8(b).

k) On February 11, 2019, the Company issued 317,600 shares of common stock upon the conversion of $24,697 of principal pursuant to the loan described in Note 8(e).

l) On February 12, 2019, the Company issued 300,000 shares of common stock upon the conversion of $21,750 of principal pursuant to the loan described in Note 8(b).

m) On February 14, 2019, the Company issued 1,400,000 shares of common stock upon the conversion of $140,000 principal pursuant to the convertible promissory note described in Note 8(m).

n) On March 7, 2019, the Company issued 576,501 shares of common stock upon the conversion of $39,375 of principal pursuant to the loan described in Note 8( c).

11. Preferred Stock

Series A

On November 15, 2017, the Company created one series of the 20,000,000 preferred shares it is authorized to issue, consisting of 8,000,000 shares, to be designated as Series A Preferred Shares.

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On October 29, 2018, the Company amended and restated the Company’s Series A Convertible Preferred Stock. The principal terms of the Series A Preferred Shares are as follows:

Voting rights – The Series A Preferred Shares do not have voting rights.

Dividend rights – The holders of the Series A Preferred Shares shall not be entitled to receive any dividends. No dividends (other than those payable solely in common stock) shall be paid on the common stock or any class or series of capital stock ranking junior, as to dividends, to the Series A Preferred Shares during any fiscal year of the Corporation until there shall have been paid or declared and set apart during that fiscal year for the holders of the Series A Preferred Shares a dividend in an amount per share equal to (i) the number of shares of common stock issuable upon conversion of the Series A Preferred Stock times (ii) the amount per share of the dividend to be paid on the common stock.

Conversion rights – The holders of the Series A Preferred Shares have the right to convert each Class A Preferred Share and all accrued and unpaid dividends thereon shall be convertible at the option of the holder thereof, at any time after the issuance of such share into fully paid and nonassessable shares of common stock of the Corporation. The number of shares of common stock into which each share of the Series A Preferred Shares may be converted shall be determined by dividing the sum of the Stated Value of the Series A Preferred Shares ($1.00 per share) being converted and any accrued and unpaid dividends by the Conversion Price in effect at the time of the conversion. The Series A Preferred Shares may be converted at an initial conversion price of the greater of 75% of the lowest VWAP during the ten trading day period immediately preceding the date a conversion notice is delivered or $0.40 subject to adjustment for any subdivision or combination of the Company’s outstanding shares of Common Stock.

Liquidation rights – Upon the occurrence of any liquidation, each holder of Series A Preferred Shares then outstanding shall be entitled to receive, out of the assets of the Corporation available for distribution to its stockholders, before any payment shall be made in respect of the common stock, or other series of preferred stock then in existence that is outstanding and junior to the Series A Preferred Shares upon liquidation, an amount per share of Series A Preferred Shares equal to the amount that would be receivable if the Series A Preferred Shares had been converted into common stock immediately prior to such liquidation distribution, plus, accrued and unpaid dividends.

In accordance with ASC 480 Distinguishing Liabilities from Equity, the Company has classified the Series A Preferred Shares as temporary equity or “mezzanine”.

Series B

On April 16, 2018, the Company designated 1,000 shares of Series B preferred stock of the Company (the “Series B Preferred Stock”) with a stated value of $3,500 per share. The Series B Preferred Stock is neither redeemable nor convertible into common stock. The principal terms of the Series A Preferred Shares are as follows:

Issue Price - The stated price for the Series B Preferred shall be $3,500 per share.

Redemption - The Series B Preferred are not redeemable.

Dividends - The holders of the Series B Preferred shall not be entitled to receive any dividends.

Preference of Liquidation - The Corporation’s Series A Preferred Stock (the “Senior Preferred Stock) shall have a liquidation preference senior to the Series B Preferred. Upon any Fundamental Transaction, liquidation, dissolution or winding up of the Corporation, whether voluntary or involuntary, the Holders of the shares of the Series B Preferred shall be entitled, after any distribution or payment is made upon any shares of capital stock of the Corporation having a liquidation preference senior to the Series B Preferred, including the Senior Preferred Stock, but before any distribution or payment is made upon any shares of Common Stock or other capital stock of the Corporation having a liquidation preference junior to the Series B Preferred, to be paid in cash the sum of $3,500 per share. If upon such liquidation, dissolution or winding up, the assets to be distributed among the Series B Preferred Holders and all other shares of capital stock of the Corporation having the same liquidation preference as the Series B Preferred shall be insufficient to permit payment to said holders of such amounts, then all of the assets of the Corporation then remaining shall be distributed ratably among the Series B Preferred Holders and such other capital stock of the Corporation having the same liquidation preference as the Series B Preferred, if any. Upon any liquidation, dissolution or winding up of the Corporation, whether voluntary or involuntary, after provision is made for Series B Preferred Holders and all other shares of capital stock of the Corporation having the same liquidation preference as the Series B Preferred, if any, then-outstanding as provided above, the holders of Common Stock and other capital stock of the Corporation having a liquidation preference junior to the Series B Preferred shall be entitled to receive ratably all remaining assets of the Corporation to be distributed.

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Voting - The holders of shares of Series B Preferred shall be voted together with the shares of Common Stock such that the aggregate voting power of the Series B Preferred is equal to 51% of the total voting power of the Company.

Conversion - There are no conversion rights.

In accordance with ASC 480 Distinguishing Liabilities from Equity, the Company has classified the Series B Preferred Shares as temporary equity or “mezzanine”.

12. Share Purchase Warrants

The following table summarizes the continuity of share purchase warrants:

	Number of warrants			Weighted average exercise price $
Balance, December 31, 2018		1,715,177			2.14
Issued		284,717			1.20
Expired		(60,000	)		0.32
Balance, March 31, 2019		1,939,894			1.96

As at March 31, 2019, the following share purchase warrants were outstanding:

Number of warrants			Exercise price $		Expiry date
	20,375			74.00	April 10, 2019
	137,500			5.10	April 28, 2020
	250,000			0.10	June 27, 2020
	593,064	*		1.20	February 13, 2021
	125,000			1.60	February 21, 2021
	500,000			1.00	May 17, 2020
	200,000			0.00010	September 10, 2019
	113,955			1.08	October 10, 2021
	1,939,894

* This warrant is convertible into 4% of the number of common shares of the Company outstanding. At March 31, 2019, 4% of the number of shares of the Company outstanding was 14,826,590 shares.

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13. Leases

In February 2016, the FASB issued ASU No. 2016-02, Leases, which introduced a lessee model that requires the majority of leases to be recognized on the balance sheet. On January 1, 2019, the Company adopted the ASU using the modified retrospective transition approach and elected the transition option to recognize the adjustment in the period of adoption rather than in the earliest period presented. The Company elected the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allowed us to carry forward the historical lease classification. Adoption of the new standard resulted in the recording of additional net lease assets and lease liabilities of approximately $269,341 and $269,341 respectively, as of January 1, 2019. During the three months ended March 31, 2019, non-cash right of use assets recorded in exchange for non-cash operating lease liabilities was $269,341. The Company leases certain office space and equipment. Leases with an initial term of 12 months or less are not recorded on the balance sheet; we recognize lease expense for these leases on a straight-line basis over the lease term.

The depreciable lives of operating lease assets and leasehold improvements are limited by the expected lease term. The Company’s leases generally do not provide an implicit rate, and therefore the Company uses its incremental borrowing rate as the discount rate when measuring operating lease liabilities. The Company used incremental borrowing rates as of January 1, 2019 for operating leases that commenced prior to that date.

The following table sets forth the operating lease right of use (“ROU”) assets and liabilities as of March 31, 2019:

	March 31, 2019
Operating lease assets	$	232,325
Operating lease liabilities:
Current operating lease liabilities	$	233,191
Total operating lease liabilities	$	233,191

Expense related to leases is recorded on a straight-line basis over the lease term, including rent holidays. During the three months ended March 31, 2019, the Company recognized operating lease expense of $48,175. Operating lease costs are included within selling, administrative and other expenses on the condensed consolidated statements of income and comprehensive income. During the three months ended March 31, 2019, short-term lease costs were $78,035.

Cash paid for amounts included in the measurement of operating lease liabilities were $47,309 for the three months ended March 31, 2019, and this amount is included in operating activities in the condensed consolidated statements of cash flows. During the three months ended March 31, 2019, the Company reduced its operating lease liabilities by $36,150 for cash paid.

The operating lease liabilities as of March 31, 2019 reflect a weighted average discount rate of 48%. Lease payments over the next five years and thereafter are as follows:

	March 31, 2019
2019	$	173,727
2020		88,431
2021		61,372
2022		63,214
2023		21,330
2024		-
Total lease payments		408,074
Less: imputed interest		(174,883	)
Total operating lease liabilities	$	233,191

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14. Commitments and Contingencies

(a) The Company leases certain of its properties under leases that expire on various dates through 2023. Some of these agreements include escalation clauses and provide for renewal options ranging from one to five years. Leases with an initial term of 12 months or less and immaterial leases are not recorded on the balance sheet.

(b) On February 4, 2019, the Company entered into a Share Purchase Agreement (the “Purchase Agreement”) with WaveTech Global Inc. (“WaveTech”), a Delaware corporation, and the stockholders of WaveTech.   The merger of WaveTech into the Company shall be effected through a sale and exchange of shares and cash. Pursuant to the Purchase Agreement, in exchange for cash consideration and shares of common stock of the Company, the Company will acquire all right, title and interest in all of the issued and outstanding shares of stock of WaveTech. Upon the consummation of the transactions contemplated by the Purchase Agreement (the “Transactions”), WaveTech will become the majority controlling shareholder of the Company.   The consummation of the Transactions is also subject to the satisfaction or waiver (if permitted by law) of certain closing conditions, including, among other things, (i) the accuracy of the representations and warranties of the parties in all material respects, (ii) the performance of and compliance with the covenants of the parties in all material respects, (iii) receipt of certain regulatory approvals, (iv) approval by holders of a majority of WaveTech’s common stock outstanding and entitled to vote and (v) consolidation of certain subsidiaries and affiliated entities of WaveTech into WaveTech.   The parties are required to use commercially reasonable efforts to cause to be taken and to do or cause to be done all actions and things as are necessary under the terms of the Purchase Agreement or under applicable law, in order to consummate the Transactions. The parties are also required to, among other things, cooperate in all respects with each other in connection with any filing or submission to any governmental authority in connection with the Transactions.   The Purchase Agreement also contains certain termination rights for both the Company and WaveTech, including that the Company or WaveTech may terminate the Purchase Agreement if the Transactions have not been consummated on or prior to February 28, 2019.   Upon consummation of the Transactions, the Company intends to rebrand itself under the WaveTech Global name, file for a name change to WaveTech Global Inc. and apply for an up-listing to the NASDAQ exchange, subject to filing and approval by NASDAQ and FINRA.   The Company’s board of directors will expand to include three new board members from WaveTech. As of the date of these financial statements the transaction has not closed.

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15. Segment Disclosures

During the three months ended March 31, 2019 and 2018, the Company had one operating segment including:

● AW Solutions Inc., a Longwood, Florida-based company, AW Solutions Puerto Rico LLC, ADEX Corporation and ADEX Puerto LLC which is in the business of the provision of professional, multi-service line, telecommunications infrastructure and outsource services to the wireless and wireline industry, ADEX Corporation and ADEX Puerto Rico LLC offering turnkey wireless and wireline telecom service and project staffing and  TNS, Inc., an Illinois corporation (acquired January 4, 2019) which is a communications contractor that specializes in the design, installation and maintenance of structured cabling systems and,

● Spectrum Global Solutions (SGS), which consists of the rest of the Company’s operations.

Factors used to identify the Company’s reportable segments include the organizational structure of the Company and the financial information available for evaluation by the chief operating decision-maker in making decisions about how to allocate resources and assess performance. The Company’s operating segments have been broken out based on similar economic and other qualitative criteria. The Company operates the SGS reporting segment in one geographical area (the United States), the AW Solutions operating segment in two geographical areas (the United States and Puerto Rico), and the ADEX operating segment in two geographical areas (the United States and Puerto Rico).

Financial statement information by operating segment for the three months ended March 31, 2019 is presented below:

	Spectrum Global $			AWS/ADEX/TNS $		Total $
Net Sales		–			11,335,732		11,335,732
Operating (loss) income		(954,967	)		969,666		14,699
Interest expense		399,555			71,857		471,412
Depreciation and amortization		-			93,952		93,952
Total Assets as of March 31, 2019		15,067			18,021,819		18,036,886

Geographic information for the three months ended and as at March 31, 2019 is presented below:

	Revenues $		Long-Lived Assets $
Puerto Rico		310,478		3,371
United States		11,025,254		6,817,755
Consolidated Total		11,335,732		6,821,126

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Financial statement information by operating segment for the three months ended March 31, 2018 is presented below:

	Spectrum Global $			AWS/ADEX $			Total $
Net Sales		–			4,327,764			4,327,764
Operating (loss) income		(666,249	)		(77,242	)		(743,491	)
Interest expense		107,894			71,431			179,325
Depreciation and amortization		–			47,833			47,833
Total Assets as of December 31, 2018		99,835			12,830,561			10,774,123

Geographic information for the three months ended March 31, 2018 is presented below:

	Revenues $		Long-Lived Assets $
Puerto Rico		466,624		5,377
United States		3,861,140		4,016,895
Consolidated Total		4,327,764		4,022,273

16. Net (Loss) Income Per Share

	Three Months			Three Months
	Ended			Ended
	March 31,			March 31,
	2019			2018
	$			$
Numerator:
Net income (loss)		(1,332,587	)		134,269
Convertible note interest		–			87,860
Adjusted diluted net income (loss)		(1,332,587	)		222,129
Denominator:
Weighted average shares outstanding used in computing net income per share:
Basic		11,771,927			2,225,809
Effect of dilutive stock options and convertible notes payable		–			6,194,355
Effect of preferred shares		–			8,842
Diluted		11,771,927			8,429,006
Net income (loss) per share applicable to common stockholders:
Basic		(0.11	)		0.06
Diluted		(0.11	)		0.03

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17. Subsequent Events

a)	On April 2. 2019, the Company issued 1,400,000 shares of common stock upon the conversion of $70,000 and $6.930 of accrued interest described in Note 8 (d).
b)	On April 13, 2019, the Company amended the note described in Note 6(d). Pursuant to the amendment, the notes maturity was extended from April 13, 2019 to April 13, 2020. In addition, the interest rate increased from 8% to 10%.

c) On April 23, 2019, the Company issued 799,980 shares of common stock upon the conversion of $30,000 and $9,999 of accrued interest described in Note 8(d).

d) On April 23, 2019, the Company issued 699,980 shares of common stock upon the conversion of $25,000 and $9,999 of accrued interest described in Note 8(d).

e) On May 3, 2019, the Company and Dominion Capital LLC (the “Holder”) entered into an exchange agreement (the “Exchange Agreement”) to exchange the two Senior Secured Convertible Promissory Notes described in Notes 8(h) and (i), with principal amounts of $1,052,632 plus accrued interest and $295,746 plus accrued interest respectively, for a single Senior Secured Convertible Promissory note with a principal amount of $1,571,134 (the “Exchange Note”).

The interest on the outstanding principal due under the Exchange Note accrues at a rate of 12% per annum. All principal and accrued interest under the Exchange Note is due on October 17, 2020 and is convertible into shares of the Company’s Common Stock. The conversion price in effect on the date such conversion is effected shall be equal to (i) initially, $0.10 or (ii) on or after the date of the closing of the next public or private offering of equity or equity-linked securities of the Company in which the Company receives gross proceeds in an amount greater than $100,000, one hundred and five percent (105%) of the price of the Common Stock issuable in the offering. While during the first six months that the Exchange Note is outstanding, only interest payments are due to the Holder, beginning in October 2019, and on each monthly anniversary thereafter until maturity, amortization payments are due for principal and interest due under the Exchange Note. The Exchange Note includes customary events of default, including non-payment of the principal or accrued interest due on the Exchange Note. Upon an event of default, all obligations under the Exchange Note will become immediately due and payable.

The Holder was granted a right to participate in future financing transactions of the Company while the Exchange Note remains outstanding.

f) On May 6, 2019, in accordance with terms of the notes described in Notes 8(a) and (e), the Company issued an aggregate of 15,707,163 shares of the Company’s common stock to InterCloud pursuant to the automatic forced conversion of all outstanding obligations under the Notes, in full satisfaction thereof. The shares issued were unregistered and are subject to Rule 144 restrictions.

g) On May 10, 2019, the Company entered into an amendment to the note payable described in Note 8(g). Pursuant to the amendment the maturity date of the note was extended from January 15, 2019 to June 1, 2019.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

This quarterly report contains forward-looking statements. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expects”, “plan”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors that may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

Our unaudited consolidated financial statements are stated in United States dollars ($) and are prepared in accordance with United States generally accepted accounting principles. The following discussion should be read in conjunction with our financial statements and the related notes that appear elsewhere in this quarterly report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed below and elsewhere in this quarterly report.

In this quarterly report, unless otherwise specified, all dollar amounts are expressed in United States dollars. All references to “$” refer to United States dollars and all references to “common stock” refer to the common shares in our capital stock.

Unless specifically set forth to the contrary, when used in this report the terms “we”, “our”, the “Company” and similar terms refer to Spectrum Global Solutions, Inc., a Nevada corporation, and its consolidated subsidiaries.

The information that appears on our website at www.SpectrumGlobalSolutions.com is not part of this report.

Description of Business

On February 5, 2018, we completed our corporate jurisdiction continuation from the jurisdiction of the Province of British Columbia to the jurisdiction of the State of Nevada in accordance with the Articles of Conversion and the Articles of Incorporation filed with the Nevada Secretary of State. Our principal offices are located at 300 Crown Oak Centre, Longwood, Florida 32750. Our telephone number is (407) 512-9102. On January 2, 2018, we changed our fiscal year end to December 31.

We are a leading provider of services and solutions in the telecommunications industry to top tier communication carriers, service providers, utilities and Fortune 1000 enterprises. The telecommunications sector provides services and solutions throughout the United States, Guam, Canada and the Caribbean.

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Our telecommunications division, which was acquired on April 25, 2017, is supported by its subsidiaries: AW Solutions, Inc., AW Solutions Puerto Rico, LLC and Tropical Communications, Inc. (collectively known as “AW Solutions”), ADEX CORP and ADEX Puerto Rico LLC (acquired February 27, 2018), (collectively known as “ADEX”) and T N S, Inc (acquired January 4, 2019). AW Solutions provides a broad range of professional services and solutions to top tier communication carriers and Fortune 1000 enterprise customers. The telecommunication division offers carriers, service providers and enterprise customers professional contracting services, to include: infrastructure audits; site acquisition; architectural, structural and civil design and analysis; construction management; construction; installation; warehousing and logistics; maintenance services, that support the build-out and upgrade and operation of some of the most advanced networks, small cell, Wi-Fi, fiber and distributed antenna system (DAS) networks. We believe the expansion and migration of these next-generation networks, our long-term relationships supported by multiyear Master Service Agreements (MSA) and multi-year service contracts with major wireless, commercial wireline and wireless operators, DAS operators, tower companies, original equipment manufacturers (OEM’s) and prime contractor/project management organization provides us a significant opportunity as a long term leading and well respected industry leader in this marketplace. ADEX is a leading outsource provider of engineering and installation services, staffing solutions and other services which include consulting to the telecommunications industry, service providers and Enterprise customers. ADEX’s managed solutions diversifies the ability to service customers domestically and internationally throughout the project lifecycle. ADEX customers include many leading wireless and wireline telecommunications providers, cable broadband MSOs and Original Equipment Manufacturers (“OEM”). On a weekly basis, the Company deploys hundreds of telecommunication professionals in support of its customers. The Company believes that its global footprint of support is a differentiating factor for national and international-based customers needing a broad range of technical expertise for management of their legacy and next generation networks. The Company seeks to assist its customers throughout the entire life cycle of a network deployment via its comprehensive suite of managed solutions that include Consulting and Professional Staffing services to service providers as well as Enterprise customers, Network Implementation, Network Installation, Network Upgrades, Rebuilds, Design, Engineering and Integration Wireless Network Support, Wireless Network Integration, Wireless and Wireline Equipment Installation & Commissioning, Wireless Site Development & Construction Management, Network Engineering, Project Management, Disaster Recovery design engineering and integration. T N S, Inc. (“T N S”) is a Chicago-based structured cabling and Next-Generation DAS design and installation firm that supports voice, data, video, security and multimedia systems within commercial office buildings, multi-building campus environments, high-rise buildings, data centers and other structures. T N S, Inc. (“T N S”) is a Chicago-based structured cabling and Next-Generation DAS design and installation firm that supports voice, data, video, security and multimedia systems within commercial office buildings, multi-building campus environments, high-rise buildings, data centers and other structures. T N S extends our geographic reach to the Midwest area and our client reach to end-users, such as multinational corporations, universities, school districts and other large organizations and enterprise clientele that have significant ongoing next generation network needs. T N S works both in the US and Internationally.

We provide the following categories of offerings to our customers:

● Telecommunication Division: We provide a comprehensive array of professional services and solutions to our clients that are applicable across multiple platforms and technologies to include but not limited to: Wi-Fi , Wi-Max and wide-area networks, fiber networks, DAS networks (iDAS/oDAS), small cell distributed networks, public safety networks and enterprise networks for incumbent local exchange carriers (ILECs), telecommunications original equipment manufacturers (OEMs), cable broadband multiple system operators (MSOs), tower and network aggregators, utility entities and enterprise customers. Our services teams support the deployment of new networks and technologies, as well as expand and maintain existing networks.   WaveTech Global Inc., which is under a definitive agreement to be acquired by us, is supported by its subsidiaries: Wavetech Inc., WaveTech GmbH, Inc. (collectively known as “WaveTech Global”). WaveTech is a global next generation energy management company that specializes in asset lifecycle extension, intellectual property development, and implementation services. The Company offers a global portfolio of end-to-end energy optimization and lifecycle management solutions developed from proprietary intellectual property, engineered systems, and operational expertise. WaveTech Global extensive suite of products include power asset life extension, operational servicing and automation, lifetime cost reduction, and real-time heterogeneous power source switching. WaveTech Global, through its diverse portfolio of intellectual property and engineering expertise, dramatically improves the availability and efficiency of customer networks through automation, analytics, machine learning and material science innovation. Services we provide include: Software as a Service (SaaS) subscription-based monitoring and analytics; critical power engineering design, and installation; critical power system maintenance and replacement; asset lifecycle extension that enable some of the most sophisticated and mission-critical networks in the world.

Upon completion of our proposed acquisition of WaveTech Global Inc, will position our company as a leading end-to-end technology platform company that provides software, services, and solutions that dramatically increase the availability and cost efficiency of global communication solutions and supporting next generation networks. The expansion of our combined business units provides array of solutions and services which address data-center, wireless, and wireline-based networks across the globe.

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Our Operating Units

Our company is comprised of the following:

● AW Solutions. - AW Solutions, Inc., a Florida corporation (April 17, 2006), AW Solutions Puerto Rico, LLC, Puerto Rico limited liability company (March 14, 2011) and Tropical Communications, Inc., a Florida corporation (May 9, 1984), (Collectively known as, “AW Solutions”). We are professional, multi-service line, telecommunications infrastructure companies that provide outsourced services to the wireless and wireline industry. AW Solution’s services include network systems design, site acquisition services, asset audits, architectural and engineering services, program management, construction management and inspection, construction, installation, maintenance and other technical services. AW Solutions provides in-field design, Computer Aided Design and Drawing services (CADD), fiber and DAS deployments for facilities and outdoor environments.

● ADEX - ADEX CORP, a New York corporation (October 29, 1993) and ADEX Puerto Rico, LLC. a Puerto Rico limited liability company (April 17, 2008), (collectively known as “ADEX”). ADEX is a leading outsource provider of engineering and installation services, staffing solutions and other services which include consulting to the telecommunications industry, service providers and Enterprise customers domestically and internationally. The Company seeks to assist its customers throughout the entire life cycle of a network deployment via its comprehensive suite of managed solutions that include Consulting and Professional Staffing services to service providers as well as Enterprise customers, Network Implementation, Network Installation, Network Upgrades, Rebuilds, Design, Engineering and Integration Wireless Network Support, Wireless Network Integration, Wireless and Wireline Equipment Installation & Commissioning, Wireless Site Development & Construction Management, Network Engineering, Project Management, Disaster Recovery design engineering and integration.

● T N S - T N S, Inc. an Illinois corporation (July 5, 2002) is a Chicago-based structured cabling and Next-Generation DAS design and installation firm that supports voice, data, video, security and multimedia systems within commercial office buildings, multi-building campus environments, high-rise buildings, data centers and other structures. T N S extends our geographic reach to the Midwest area and our client reach to end-users, such as multinational corporations, universities, school districts and other large organizations and enterprise clientele that have significant ongoing next generation network needs. T N S works both in the US and Internationally.

Results of Operations for the Three Month Periods Ended March 31, 2019 and March 31, 2018

Revenues

Our operating results for the three month periods ended March 31, 2019 and 2018 are summarized as follows:

	Three Months Ended March 31, 2019			Three Months Ended March 31, 2018		Difference
Revenue	$	11,335,732		$	4,327,764	$	7,007,968
Operating expenses	$	11,321,033		$	5,071,255	$	6,249,778
Other income (expense)	$	(1,337,688	)	$	822,987	$	2,160,675	)
Net income (loss)	$	(1,332,587	)	$	134,269	$	(1,466,856	)

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Revenue generated during the three months ended March 31, 2019, was $11,335,752 compared to $4,327,764 for the period ended March 31, 2018. During the period ended March 31, 2019, a majority of our revenues and a significant portion of our expenses were generated by our acquired telecommunications division (AW Solutions, Inc.; AW Solutions Puerto Rico, LLC; Tropical Communications, Inc. on April 25, 2017 and ADEX Corp, ADEX PUERTO RICO LLC, ADEX TOWERS, INC., ADEX TELECOM, INC. on February 28, 2018. Our telecommunications division generated $9,360,833 of revenue and our TNS division, which was acquired in January 4, 2019, accounted for $1,974,899 of revenue. During the three months ended March 31, 2018, all of our revenue was generated by our telecommunications division.

Expenses

During the three months ended March 31, 2019, our operating expenses were $11,321,033 compared to operating expenses of $5,071,255 for the three month period ended March 31, 2018. The increase on operating expense is a result of the acquisition of ADEX on February 28, 2018, which consisted of ADEX Corp, ADEX PUERTO RICO LLC, ADEX TOWERS, INC and ADEX TELECOM, INC and the acquisition of TNS, Inc, on January 4, 2019. These expenses include general and administrative costs, all of our corporate costs, as well as costs from our subsidiaries management personnel and administrative overhead. These costs primarily consist of employee compensation and related expenses, including legal, consulting and professional fees, information technology, provisions for recoveries of bad debt and other costs not directly related to performance of our services under customer contracts. We expect these expenses to continue to generally increase as we expand our operations, but expect that such expenses as a percentage of revenue will decrease if we succeed in increasing revenues.

General and administrative costs were $1,044,708 for the three months ended March 31, 2019 compared to $661,298 for the three months ended March 31, 2018. Salaries and wages were $1,358,208 for the three months ended March 31, 2019 compared to $577,604 for the three months ended March 31, 2018. Depreciation and amortization costs were $93,952 for the three months ended March 31, 2019 compared to $47,833 for the three months ended March 31, 2018. Cost of revenues increased from$3,784,520 for the three months ended March 31, 2018 to $8,824,165 for the same period in 2019.

Other Income (Expense)

For the three months ended March 31, 2019, we had other expenses of $(1,337,688) compared to other income of $822,987 for the same period in 2018. The decrease was primarily due to a gain on settlement of debt of $561,963, a gain on extinguishment of preferred stock liability of $287,815 a gain on the change in fair value of derivatives of $806,621, amortization of debt discounts of $654,087 and interest expense of $179,325 during the three months ended March 31, 2018, compared to a gain on settlement of debt of $164,457, a loss on the change in fair value of derivatives of $369,391, amortization of debt discounts of $661,352 and interest expense of $471,412 during the three month period ended March 31, 2019. The increase in interest expense was a result of the higher principal debt balances outstanding in the three months ended March 31, 2019 compared to the three months ended March 31, 2018.

Net Income (Loss)

For the three months ended March 31, 2019, we incurred a net loss of $(1,332,587) compared to a net income of $134,269 for the same period in 2018.

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Liquidity and Capital Resources

As of March 31, 2019, our total current assets were $11,215,761 and our total current liabilities were $22,457,802, resulting in a working capital deficit of $11,242,041 compared to a working capital deficit of $8,464,969 as of December 31, 2018.

We suffered recurring losses from operations. The continuation of our company is dependent upon our company attaining and maintaining profitable operations and raising additional capital as needed. In this regard, we have historically raised additional capital through equity offerings and loan transactions.

Cash Flows

	Three Months Ended March 31, 2019			Three Months Ended March 31, 2018
Statement of Operations Data:
Net Cash Used In Operating Activities	$	(544,700	)	$	(656,590	)
Net Cash Used in Investing Activities	$	(994,133	)	$	(182,855	)
Net Cash Provided by Financing Activities	$	1,885,029		$	730,181
Change In Cash	$	346,196			28,893

The increase in cash that we experienced in the period ended March 31, 2019, compared to the increase during the period ended March 31, 2018, is primarily due to the acquisition of ADEX and its subsidiaries along with the acquisition of TNS and increased funding requirements for ongoing operating activities. During the period ended March 31, 2019, the repayment of loans payable of $6,147,609 and convertible notes payable of $331,552 was made, and proceeds were received from notes and convertible notes payable of $8,367,190, which created the cash balance as noted above. We expect that our cash position will increase, due to operating profits in the telecommunication division and TNS division. Over the coming months and year, subject to raising additional funds, we plan to primarily concentrate on our existing business.

In order to improve our liquidity, we intend to pursue additional equity financing from private placement sales of our equity securities or shareholders loans. There is no assurance that we will be successful in completing any further private placement financing. If we are unable to achieve the necessary additional financing, then we plan to reduce the amounts we spend on our business activities and administrative expenses in order to be within the amount of capital resources that are available to us.

As of March 31, we had cash of $996,790, compared to $285,339 as of March 31, 2018. Our cash balance at the beginning of this year was $620,593.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements.

Inflation

The effect of inflation on our revenue and operating results has not been significant.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

As a “smaller reporting company”, we are not required to provide the information required by this Item.

Item 4. Controls and Procedures

Evaluation of disclosure controls and procedures.

Our management, with the participation of our Chief Executive Officer, evaluated the effectiveness of our disclosure controls and procedures pursuant to Rule 13a-15 under the Exchange Act. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs.

Based on management’s evaluation, our Chief Executive Officer concluded that, as a result of the material weaknesses described below, as of December 31, 2018, our disclosure controls and procedures are not designed at a reasonable assurance level and are not effective to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer, as appropriate, to allow timely decisions regarding required disclosure. The material weaknesses, which relate to internal control over financial reporting, that were identified are:

a)

Due to our small size, we do not have a proper segregation of duties in certain areas of our financial reporting process. The areas where we have a lack of segregation of duties include cash receipts and disbursements, approval of purchases and approval of accounts payable invoices for payment. This control deficiency, which is pervasive in nature, results in a reasonable possibility that material misstatements of the consolidated financial statements will not be prevented or detected on a timely basis; and

b)

We do not have any formally adopted internal controls surrounding its cash and financial reporting procedures.

We are committed to improving our financial organization. In addition, we will look to increase our personnel resources and technical accounting expertise within the accounting function to resolve non-routine or complex accounting matters. In addition, as funds are available, we will take the following action to enhance our internal controls: Hiring additional knowledgeable personnel with technical accounting expertise to further support our current accounting personnel, which management estimates will cost approximately $300,000 per annum. As our operations are relatively small we expect that both our technical and accounting expertise will be improved, however our overall financial requirements will only increase. We continue to have net cash losses each quarter, we do not anticipate being able to hire additional internal personnel until such time as our operations are profitable on a cash basis or until our operations are large enough to justify the hiring of additional accounting personnel. We currently engage an outside accounting firm to assist us in the preparation of our consolidated financial statements this past year and will plan to evaluate our internal capabilities as we integrate the business segments to address the sufficient number of internal accounting personnel to achieve compliance. As necessary, we will engage consultants in the future in order to ensure proper accounting for our consolidated financial statements.

Due to the fact that our internal accounting staff consists solely of a Chief Executive Officer, who functions as our Principal Accounting Officer, additional personnel will also ensure the proper segregation of duties and provide more checks and balances within the department. Additional personnel will also provide the cross training needed to support us if personnel turn over issues within the department occur. We believe this will greatly decrease any control and procedure issues we may encounter in the future.

Changes in internal control over financial reporting.

There were no changes in our internal control over financial reporting that occurred during the quarter ended March 31, 2019 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II – OTHER INFORMATION

Item 1. Legal Proceedings

From time to time, we may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business. We are currently not aware of any such legal proceedings or claims that we believe will have, individually or in the aggregate, a material adverse effect on our business, financial condition or operating results.

Item 1A. Risk Factors

As a “smaller reporting company,” we are not required to provide the information required by this Item.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Since the beginning of the three month period ended March 31, 2019, we have not sold any equity securities that were not registered under the Securities Act of 1933 that were not previously reported in an annual report on Form 10-K, in a quarterly report on Form 10-Q or in a current report on Form 8-K, or are listed below.

a) On January 14, 2019, the Company issued 100,000 shares of common stock upon the conversion of $9,746 of principal pursuant to the loan described in Note 8(e).

b) On January 14, 2019, the Company issued 110,742 shares of common stock upon the conversion of $10,000 of principal pursuant to the loan described in Note 8(b).

c) On January 28, 2019, the Company issued 200,000 shares of common stock upon the conversion of $15,552 of principal pursuant to the loan described in Note 8(e).

d) On February 1, 2019, the Company issued 2,859,230 shares of common stock to employees and directors of the Company in exchange for services for the Company. The shares vest over periods between 11 and 36 months. During the quarter ended March 31, 2019, the Company recorded $28,270 for the vested portion of the shares, leaving $343,430 of unvested compensation expense to be recognized in future periods

e) On February 7, 2019, the holder of the assigned note converted $75,000 of the note and $7,499 of interest into 1,071,418 shares of the Company’s common stock.

f) On February 7, 2019, the Company issued 172,414 shares of common stock upon the conversion of $12,500 of principal pursuant to the loan described in Note 8(b).

g) On February 11, 2019, the Company issued 317,600 shares of common stock upon the conversion of $24,697 of principal pursuant to the loan described in Note 8(e).

h) On February 12, 2019, the Company issued 300,000 shares of common stock upon the conversion of $21,750 of principal pursuant to the loan described in Note 8(b).

i) On February 14, 2019, the Company issued 1,400,000 shares of common stock upon the conversion of $140,000 principal pursuant to the convertible promissory note described in Note 8(m).

j)	On March 7, 2019, the Company issued 576,501 shares of common stock upon the conversion of $39,375 of principal pursuant to the loan described in Note 8( c).
	The above issuances of the Company’s securities were not registered under the Securities Act and the Company relied on an exemption from registration provided by rule 506 of Regulation D promulgated under the Securities Act for such issuances.

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Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

Item 6. Exhibits

Exhibit #	Exhibit Description
10.1	Employment agreement, dated August 1, 2018, by and between the Company and Roger Ponder
10.2	Employment agreement, dated August 1, 2018, by and between the Company and Keith Hayter
31.1	Certification of the Principal Executive Officer pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of the Principal Financial Officer and Principal Accounting Officer pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certifications of the Principal Executive Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certifications of the Principal Financial Officer and Principal Accounting Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101 SCH	XBRL Taxonomy Extension Schema Document
101 CAL	XBRL Taxonomy Calculation Linkbase Document
101 LAB	XBRL Taxonomy Labels Linkbase Document
101 PRE	XBRL Taxonomy Presentation Linkbase Document
101 DEF	XBRL Taxonomy Extension Definition Linkbase Document

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	SPECTRUM GLOBAL SOLUTIONS, INC.
Date: May 15, 2019	By:	/s/ Roger M. Ponder
		Roger M. Ponder
		Chief Executive Officer and Principal Financial Officer

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EX-10.1

Exhibit 10.1

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into this 1st day of June 2018 (the “Effective Date”), by and between Spectrum Global Solutions, Inc., a Nevada Corporation (the “Company”), and Roger Ponder (the “Executive”).

RECITALS

THE PARTIES ENTER THIS AGREEMENT on the basis of the following facts, understandings and intentions:

A. The Company desires to employ the Executive, and the Executive desires to accept such employment, on the terms and conditions set forth in this Agreement.

B. This Agreement shall be effective immediately and shall govern the employment relationship between the Executive and the Company from and after the Effective Date, and, as of the Effective Date, supersedes and negates all previous agreements and understandings with respect to such relationship (the “Prior Employment Agreement”).

AGREEMENT

NOW, THEREFORE, in consideration of the above recitals incorporated herein and the mutual covenants and promises contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby expressly acknowledged, the parties agree as follows:

1. Retention and Duties.

1.1 Retention. The Company does hereby hire, engage and employ the Executive for the Period of Employment (as such term is defined in Section 2) on the terms and conditions expressly set forth in this Agreement. The Executive does hereby accept and agree to such hiring, engagement and employment, on the terms and conditions expressly set forth in this Agreement. Certain capitalized terms used herein are defined in Section 5.5 of this Agreement.

1.2 Duties.  During the Period of Employment, the Executive shall serve the Company as its Chief Executive Officer (“CEO”) and shall have the powers, authorities, duties and obligations of management usually vested in such position for a company of a similar size and similar nature of the Company, and such other powers, authorities, duties and obligations commensurate with such positions as the Company’s Board of Directors (the “Board”) may assign from time to time, all subject to the directives of the Board, and the corporate policies of the Company as they are in effect from time to time throughout the Period of Employment (including, without limitation, the Company’s employee handbook, business conduct and ethics policies, and other personnel policies, as they may change from time to time). During the Period of Employment, the Executive shall report to the Board.

1.3 No Other Employment; Minimum Time Commitment. During the Period of Employment, the Executive shall (i) devote substantially all of the Executive’s business time, energy and skill to the performance of the Executive’s duties for the Company, (ii) perform such duties in a faithful, effective and efficient manner to the best of his abilities, and (iii) hold no other employment without the express written approval of the Board. The Executive’s service on the boards of directors (or similar body) of other business entities is subject to the approval of the Board. The Company shall have the right to require the Executive to resign from any board or similar body (including, without limitation, any association, corporate, civic or charitable board or similar body) which he may then serve if the Board reasonably determines that the Executive’s service on such board or body interferes with the effective discharge of the Executive’s duties and responsibilities to the Company or that any business related to such service is then in competition with any business of the Company or any of its Affiliates, successors or assigns.

1.4 No Breach of Contract. The Executive hereby represents to the Company and agrees that: (i) the execution and delivery of this Agreement by the Executive and the Company and the performance by the Executive of the Executive’s duties hereunder do not and shall not constitute a breach of, conflict with, or otherwise contravene or cause a default under, the terms of any other agreement or policy to which the Executive is a party or otherwise bound or any judgment, order or decree to which the Executive is subject; (ii) the Executive will not enter into any new agreement that would or reasonably could contravene or cause a default by the Executive under this Agreement; (iii) the Executive has no information (including, without

1.5 limitation, confidential information and trade secrets) relating to any other Person which would prevent, or be violated by, the Executive entering into this Agreement or carrying out his duties hereunder; (iv) the Executive is not bound by any employment, consulting, non-compete, confidentiality, trade secret or similar agreement (other than this Agreement) with any other Person; (v) to the extent the Executive has any confidential or similar information that he is not free to disclose to the Company, he will not disclose such information to the extent such disclosure would violate applicable law or any other agreement or policy to which the Executive is a party or by which the Executive is otherwise bound; and (vi) the Executive understands the Company will rely upon the accuracy and truth of the representations and warranties of the Executive set forth herein and the Executive consents to such reliance.

1.6 Location. The Executive’s principal place of employment shall be the Company’s offices in Florida.

2. Period of Employment. The “Period of Employment” shall be a period of three (3) years commencing on the Effective Date and ending at the close of business on the third anniversary of the Effective Date (the “Termination Date”); provided, however, that this Agreement shall be automatically renewed, and the Period of Employment shall be automatically extended for one (1) additional year on the Termination Date and each anniversary of the Termination Date thereafter, unless either party gives written notice at least sixty (60) days prior to the expiration of the Period of Employment (including any renewal thereof) of such party’s desire to terminate the Period of Employment (such notice to be delivered in accordance with Section 18). The term “Period of Employment” shall include any extension thereof pursuant to the preceding sentence. Provision of notice that the Period of Employment shall not be extended or further extended, as the case may be, shall not constitute a breach of this Agreement and shall not constitute “Good Reason” for purposes of this Agreement. Notwithstanding the foregoing, the Period of Employment is subject to earlier termination as provided below in this Agreement.

3. Compensation.

3.1 Base Salary. During the Period of Employment, the Company shall pay the Executive a base salary (the “Base Salary”), which shall be paid in accordance with the Company’s regular payroll practices in effect from time to time but not less frequently than in monthly installments. The Executive’s Base Salary shall be at an annualized rate of Three Hundred and Fifty Thousand Dollars ($350,000). The Board (or a committee thereof) may, in its sole discretion, increase (but not decrease) the Executive’s rate of Base Salary.

3.2 Incentive Bonus. Commencing on the Effective Date, the Executive shall be eligible to receive an incentive bonus for each fiscal year of the Company that occurs during the Period of Employment (“Incentive Bonus”). Notwithstanding the foregoing and except as otherwise expressly provided in this Agreement, the Executive must be employed by the Company at the time the Company pays incentive bonuses to employees generally with respect to a particular fiscal year in order to be eligible for an Incentive Bonus for that year (and, if the Executive is not so employed at such time, in no event shall he have been considered to have “earned” any Incentive Bonus with respect to the fiscal year). The Executive’s target Incentive Bonus amount for a particular fiscal year of the Company shall equal no less than 60% of the Executive’s Base Salary paid by the Company to the Executive for that fiscal year; provided that the Executive’s actual Incentive Bonus amount for a particular fiscal year shall be determined by the Board (or a committee thereof) in its sole discretion, based on performance objectives (which may include corporate, business unit or division, financial, strategic, individual or other objectives) established with respect to that particular fiscal year by the Board (or a committee thereof).

3.3 Stock Option Grant. Subject to approval by the Board (or a committee thereof), the Company will grant the Executive a stock option (the “Option”) to purchase shares determined by the Board of Directors of the Company’s common stock at a price per share not less than the per-share fair market value of the common stock on the date of grant, as reasonably determined by the Board (or a committee thereof). The Option will vest with respect to twenty- five percent (25%) of the shares subject to the Option on the first anniversary of the grant date of the Option. The remaining seventy-five percent (75%) of the shares subject to the Option will vest in 24 months substantially equal monthly installments thereafter. In each case, the vesting of the Option is subject to the Executive’s continued employment by the Company through the respective vesting date. The maximum term of the Option will be ten (10) years, subject to earlier termination upon the termination of the Executive’s employment with the Company, a change in control of the Company and similar events. The Option shall be intended as an “incentive stock option” under Section 422 of the Internal Revenue Code, as amended (the “Code”), subject to the terms and conditions of Section 422 of the Code (including, without limitation, the Code limitation on the number of options that may become exercisable in any given year and still qualify as such an incentive stock option). The Option shall be granted under the Company’s Performance Incentive Plan and shall be subject to such further terms and conditions as set forth in the Company’s standard form of award agreement for stock options granted under the plan.

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3.4 Sign On Stock Option Grant. Subject to approval by the Board (or a committee thereof), the Company will grant the Executive a stock option (the “Sign On Option”) to purchase XXX, XXX shares of the Company’s common stock at a price per share not less than the per-share fair market value of the common stock on the date of grant, as reasonably determined by the Board (or a committee thereof). The Option will vest immediately. The maximum term of the Option will be ten (10) years, subject to earlier termination upon the termination of the Executive’s employment with the Company, a change in control of the Company and similar events. The Option shall be intended as an “incentive stock option” under Section 422 of the Internal Revenue Code, as amended (the “Code”), subject to the terms and conditions of Section 422 of the Code (including, without limitation, the Code limitation on the number of options that may become exercisable in any given year and still qualify as such an incentive stock option). The Option shall be granted under the Company’s Performance Incentive Plan and shall be subject to such further terms and conditions as set forth in the Company’s standard form of award agreement for stock options granted under the plan.

4. Benefits.

4.1 Retirement. Welfare and Fringe Benefits. During the Period of Employment, the Executive shall be entitled to participate in all employee pension and welfare benefit plans and programs, and fringe benefit plans and programs, made available by the Company to the Company’s employees generally, in accordance with the eligibility and participation provisions of such plans and as such plans or programs may be in effect from time to time.

4.2 Reimbursement of Business Expenses. The Executive is authorized to incur reasonable expenses in carrying out the Executive’s duties for the Company under this Agreement and shall be entitled to reimbursement for all reasonable business expenses the Executive incurs during the Period of Employment in connection with carrying out the Executive’s duties for the Company, subject to the Company’s expense reimbursement policies and any pre-approval policies in effect from time to time. The Executive agrees to promptly submit and document any reimbursable expenses in accordance with the Company’s expense reimbursement policies to facilitate the timely reimbursement of such expenses.

4.3 Vacation and Other Leave. During the Period of Employment, the Executive’s annual rate of vacation accrual shall be four (4) weeks per year, with such vacation to accrue and be subject to the Company’s vacation policies in effect from time to time, including any policy which may limit vacation accruals and/or limit the amount of accrued but unused vacation to carry over from year to year. The Executive shall also be entitled to all other holiday and leave pay generally available to other executives of the Company.

5. Termination.

5.1 Termination by the Company. The Executive’s employment by the Company, and the Period of Employment, may be terminated at any time by the Company:

(i) with Cause, with no less than thirty (30) days advance written notice to the Executive (such notice to be delivered in accordance with Section 18), or (iii) in the event of the Executive’s death, or (iv) in the event that the Board determines in good faith that the Executive has a Disability.

5.2 Termination by the Executive. The Executive’s employment by the Company, and the Period of Employment, may be terminated by the Executive with no less than thirty (30) days advance written notice to the Company (such notice to be delivered in accordance with Section 18); provided, however, that in the case of a termination for Good Reason or a Change of Control event as defined herein, the Executive may provide immediate written notice of termination once the applicable cure period (as contemplated by the definition of Good Reason) has lapsed if the Company has not reasonably cured the circumstances that gave rise to the basis for the Good Reason termination.

5.3 Benefits upon Termination. If the Executive’s employment by the Company is terminated during the Period of Employment for any reason by the Company or by the Executive, upon change of control event (section5.5d), or upon or following the expiration of the Period of Employment (in any case, the date that the Executive’s employment by the Company terminates is referred to as the “Severance Date”), the Company shall have no further obligation to make or provide to the Executive, and the Executive shall have no further right to receive or obtain from the Company, any payments or benefits except as follows:

(a) The Company shall pay the Executive (or, in the event of his death, the Executive’s estate) any Accrued Obligations;

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(b) If, during the Period of Employment, the Executive’s employment with the Company terminates as a result of a termination by the Company without Cause (other than due to the Executive’s death or Disability) or a resignation by the Executive for Good Reason, the Executive shall be entitled to the following benefits:

(i) The Company shall pay the Executive (in addition to the Accrued Obligations), subject to tax withholding and other authorized deductions, an amount equal to the sum of twenty-four (24) months of Executive’s Base Salary at the monthly rate in effect on the Severance Date, plus two (2) times the Executive’s Target Bonus for the fiscal year of the Company in which the Severance Date occurs. Such amount is referred to hereinafter as the “Severance Benefit.” Subject to Section 21(b), the Company shall pay the Severance Benefit to the Executive in a lump sum or, at the option of the Executive, in equal monthly installments (rounded down to the nearest whole cent) over a period of twelve (12) consecutive months, with the first installment payable on (or within ten (10) days following) the sixtieth (60th) day following the Executive’s Separation from Service.

(ii) The Company will pay or reimburse the Executive for his premiums charged to continue medical coverage pursuant to the Consolidated Omnibus Budget Reconciliation Act (“COBRA”), at the same or reasonably equivalent medical coverage for the Executive (and, if applicable, the Executive’s eligible dependents) as in effect immediately prior to the Severance Date, to the extent that the Executive elects such continued coverage; provided that the Company’s obligation to make any payment or reimbursement pursuant to this clause (ii) shall, subject to Section 21(b), commence with continuation coverage for the month following the month in which the Executive’s Separation from Service occurs and shall cease with continuation coverage for the twelve month (12th) month following the month in which the Executive’s Separation from Service occurs (or, if earlier, shall cease upon the first to occur of the Executive’s death, the date the Executive becomes eligible for coverage under the health plan of a future employer, or the date the Company ceases to offer group medical coverage to its active executive employees or the Company is otherwise under no obligation to offer COBRA continuation coverage to the Executive). To the extent the Executive elects COBRA coverage, he shall notify the Company in writing of such election prior to such coverage taking effect and complete any other continuation coverage enrollment procedures the Company may then have in place

(iii) The Company shall promptly pay to the Executive any Incentive Bonus that would otherwise be paid to the Executive had his employment by the Company not terminated with respect to any fiscal year that ended before the Severance Date, to the extent not theretofore paid (such payment to be made at the time bonuses for the fiscal year are paid to the Company’s executives generally).

(iv) As to each then-outstanding stock option and other equity-based award granted by the Company to the Executive that vests based solely on the Executive’s continued service with the Company, the Executive shall vest as of the Severance Date in any portion of such award in which the Executive would have vested thereunder if the Executive’s employment with the Company had continued for twelve (12) months after the Severance Date (and any portion of such award that is not vested after giving effect to this acceleration provision shall terminate on the Severance Date). As to each outstanding stock option or other equity-based award granted by the Company to the Executive that is subject to performance-based vesting requirements, the vesting of such award will continue to be governed by its terms, provided that for purposes of any service-based vesting requirement under such award, the Executive’s employment with the Company will be deemed to have continued for Twelve (12) months after the Severance Date. Notwithstanding the foregoing, if the Severance Date occurs on or after the date of a Change in Control Event, each stock option and other equity-based award granted by the Company to the Executive, to the extent then outstanding and unvested, shall be fully vested as of the Severance Date.

(c) If, during the Period of Employment, the Executive’s employment with the Company terminates as a result of the Executive’s death or Disability, the Company shall pay the Executive the amount by Section 5.3(b)(iii).

(d) Notwithstanding the foregoing provisions of this Section 5.3, if the Executive breaches his obligations under Section 6 of this Agreement at any time, from and after the date of such breach and not in any way in limitation of any right or remedy otherwise available to the Company, the Executive will no longer be entitled to, and the Company will no longer be obligated to pay, any remaining unpaid portion of the Severance Benefit or any remaining unpaid amount contemplated by Section 5.3(b)(iii) or 5.3(c), or to any continued Company-paid or reimbursed coverage pursuant to Section 5.3(b)(ii); provided that, if the Executive provides the Release contemplated by Section 5.4, in no event shall the Executive be entitled to benefits pursuant to Section 5.3(b) or 5.3(c), as applicable, of less than $5,000 (or the amount of such benefits, if less than $5,000), which amount the parties agree is good and adequate consideration, in and of itself, for the Executive’s Release contemplated by Section 5.4.

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(e) The foregoing provisions of this Section 5.3 shall not affect: (i) the Executive’s receipt of benefits otherwise due terminated employees under group insurance coverage consistent with the terms of the applicable Company welfare benefit plan; (ii) the Executive’s rights under COBRA to continue health coverage; or (iii) the Executive’s receipt of benefits otherwise due in accordance with the terms of the Company’s 401(k) plan (if any).

5.4 Release; Exclusive Remedy; Leave.

(a) This Section 5.4 shall apply notwithstanding anything else contained in this Agreement or any stock option or other equity-based award agreement to the contrary. As a condition precedent to any Company obligation to the Executive pursuant to Section 5.3(b) or 5.3(c) or any other obligation to accelerate vesting of any equity-based award in connection with the termination of the Executive’s employment, the Executive shall provide the Company with a valid, executed general release agreement in substantially the form attached hereto as Exhibit A (with such changes as may be reasonably required to such form to help ensure its enforceability in light of any changes in applicable law) (the “Release”), and such Release shall have not been revoked by the Executive pursuant to any revocation rights afforded by applicable law. The Company shall provide the final form of Release to the Executive not later than seven (7) days following the Severance Date, and the Executive shall be required to execute and return the Release to the Company within twenty-one (21) days (or forty-five (45) days if such longer period of time is required to make the Release maximally enforceable under applicable law) after the Company provides the form of Release to the Executive.

(b) The Executive agrees that the payments and benefits contemplated by Section 5.3 (and any applicable acceleration of vesting of an equity-based award in accordance with the terms of such award in connection with the termination of the Executive’s employment) shall constitute the exclusive and sole remedy for any termination of his employment and the Executive covenants not to assert or pursue any other remedies, at law or in equity, with respect to any termination of employment. The Company and the Executive acknowledge and agree that there is no duty of the Executive to mitigate damages under this Agreement. All amounts paid to the Executive pursuant to Section 5.3 shall be paid without regard to whether the Executive has taken or takes actions to mitigate damages. The Executive agrees to resign, on the Severance Date, as an officer and director of the Company and any Affiliate of the Company, and as a fiduciary of any benefit plan of the Company or any Affiliate of the Company, and to promptly execute and provide to the Company any further documentation, as requested by the Company, to confirm such resignation.

(c) In the event that the Company provides the Executive notice of termination without Cause pursuant to Section 5.1 or the Executive provides the Company notice of termination pursuant to Section 5.2, the Company will have the option to place the Executive on paid administrative leave during the notice period.

5.5 Certain Defined Terms.

(a) As used herein, “Accrued Obligations” means:

(i) any Base Salary that had accrued but had not been paid on or before the Severance Date;

(ii) any accrued but unused vacation as of the Severance Date; and

(iii) any reimbursement due to the Executive pursuant to Section 4.2 for expenses reasonably incurred by the Executive on or before the Severance Date and documented and pre-approved, to the extent applicable, in accordance with the Company’s expense reimbursement policies in effect at the applicable time.

(b) As used herein, “Affiliate” of the Company means a Person that directly or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the Company. As used in this definition, the term “control,” including the correlative terms “controlling,” “controlled by” and “under common control with,” means the possession, directly or indirectly, of the power to direct or cause the direction of management or policies (whether through ownership of securities or any partnership or other ownership interest, by contract or otherwise) of a Person.

(c) As used herein, “Cause” shall mean, as reasonably determined by the Board (excluding the Executive, if he is then a member of the Board) based on the information then known to it, that one or more of the following has occurred:

(i) the Executive is convicted of, pled guilty or pled nolo contendere to a felony (under the laws of the United States or any relevant state, or a similar crime or offense under the applicable laws of any relevant foreign jurisdiction);

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(ii) the Executive has engaged in acts of fraud, dishonesty or other acts of willful misconduct in the course of his duties hereunder;

(iii) the Executive willfully fails to perform or uphold his duties under this Agreement and/or willfully fails to comply with reasonable directives of the Board; or

(iv) a breach by the Executive of any other provision of Section 6, or any material breach by the Executive of any other contract he is a party to with the Company or any of its Affiliates.

(d) As used herein, “Change in Control Event” shall mean

(i) The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of more than 30% of either (1) the then-outstanding shares of common stock of the Company (the “Outstanding Company Common Stock”) or (2) the combined voting power of the then-outstanding voting securities of the Company entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”); provided, however, that, for purposes of this clause (a), the following acquisitions shall not constitute a Change in Control Event; (A) any acquisition directly from the Company, (B) any acquisition by the Company, (C) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any affiliate of the Company or a successor, (D) any acquisition by any entity pursuant to a transaction that complies with Sections (iii)(1), (2) and (3) of this definition below, (E) any acquisition by a Person described in and satisfying the conditions of Rule 13d-1(b) promulgated under the Exchange Act, or (F) any acquisition by a Person who is the beneficial owner (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 30% or more of the Outstanding Company Common Stock and/or the Outstanding Company Voting Securities on the Effective Date (or an affiliate, heir, descendant, or related party of or to such Person);

(ii) Individuals who, as of the Effective Date, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the Effective Date whose election, or nomination for election by the Company’s stockholders, was approved by a vote of at least two-thirds of the directors then comprising the Incumbent Board (including for these purposes, the new members whose election or nomination was so approved, without counting the member and his predecessor twice) shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board;

(iii) Consummation of a reorganization, merger, statutory share exchange or consolidation or similar corporate transaction involving the Company or any of its Subsidiaries, a sale or other disposition of all or substantially all of the assets of the Company, or the acquisition of assets or stock of another entity by the Company or any of its Subsidiaries (each, a “Business Combination”), in each case unless, following such Business Combination, (1) all or substantially all of the individuals and entities that were the beneficial owners of the Outstanding Company Common Stock and the Outstanding Company Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 50% of the then-outstanding shares of common stock and the combined voting power of the then-outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the entity resulting from such Business Combination (including, without limitation, an entity that, as a result of such transaction, owns the Company or all or substantially all of the Company’s assets directly or through one or more subsidiaries (a “Parent”)) in substantially the same proportions as their ownership immediately prior to such Business Combination of the Outstanding Company Common Stock and the Outstanding Company Voting Securities, as the case may be, (2) no Person (excluding any entity resulting from such Business Combination or a Parent or any employee benefit plan (or related trust) of the Company or such entity resulting from such Business Combination or Parent) beneficially owns, directly or indirectly, more than 30% of, respectively, the then-outstanding shares of common stock of the entity resulting from such Business Combination or the combined voting power of the then-outstanding voting securities of such entity, except to the extent that the ownership in excess of 30% existed prior to the Business Combination, and (3) at least a majority of the members of the board of directors or trustees of the entity resulting from such Business Combination or a Parent were members of the Incumbent Board at the time of the execution of the initial agreement or of the action of the Board providing for such Business Combination; or

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(iv) Approval by the stockholders of the Company of a complete liquidation or dissolution of the Company other than in the context of a transaction that does not constitute a Change in Control Event under clause (iii) above.

(e) As used herein, “Disability” shall mean a physical or mental impairment which, as reasonably determined by the Board, renders the Executive unable to perform the essential functions of his employment with the Company, even with reasonable accommodation that does not impose an undue hardship on the Company, for more than 90 days in any 180-day period, unless a longer period is required by federal or state law, in which case that longer period would apply.

(f) As used herein, “Good Reason” shall mean the occurrence (without the Executive’s consent) of any one or more of the following conditions:

(i) a material diminution in the Executive’s rate of Base Salary; greater than 10 %

(ii) a material diminution in the Executive’s authority, duties, or responsibilities; any change in current reporting structure or personnel

(iii) a material change in the geographic location of the Executive’s principal office with the Company (for this purpose, in no event shall a relocation of such office to a new location that is not more than fifteen (15) miles from the current location of the Company’s executive offices constitute a “material change”); or

(iv) a material breach by the Company of this Agreement;

provided, however, that any such condition or conditions, as applicable, shall not constitute Good Reason unless both (x) the Executive provides written notice to the Company of the condition claimed to constitute Good Reason within sixty (60) days of the initial existence of such condition(s) (such notice to be delivered in accordance with Section 18), and (y) the Company fails to remedy such condition(s) within thirty (30) days of receiving such written notice thereof; and provided, further, that in all events the termination of the Executive’s employment with the Company shall not constitute a termination for Good Reason unless such termination occurs not more than one hundred and twenty (120) days following the initial existence of the condition claimed to constitute Good Reason.

(g) As used herein, the term “Person” shall be construed broadly and shall include, without limitation, an individual, a partnership, a limited liability company, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof.

(h) As used herein, a “Separation from Service” occurs when the Executive dies, retires, or otherwise has a termination of employment with the Company that constitutes a “separation from service” within the meaning of Treasury Regulation Section 1.409A-1(h)(1), without regard to the optional alternative definitions available thereunder.

5.6. Notice of Termination. Any termination of the Executive’s employment under this Agreement shall be communicated by written notice of termination from the terminating party to the other party. This notice of termination must be delivered in accordance with Section 18 and must indicate the specific provision(s) of this Agreement relied upon in effecting the termination.

5.7 Limitation on Benefits.

(a) Notwithstanding anything contained in this Agreement to the contrary, to the extent that the payments and benefits provided under this Agreement and benefits provided to, or for the benefit of, the Executive under any other Company plan or agreement (such payments or benefits are collectively referred to as the “Benefits”) would be subject to the excise tax (the “Excise Tax”) imposed under Section 4999 of the Internal Revenue Code of 1986, as amended (the “Code”), the Benefits shall be reduced (but not below zero) if and to the extent that a reduction in the Benefits would result in the Executive retaining a larger amount, on an after-tax basis (taking into account federal, state and local income taxes and the Excise Tax), than if the Executive received all of the Benefits (such reduced amount is referred to hereinafter as the “Limited Benefit Amount”). Unless the Executive shall have given prior written notice specifying a different order to the Company to effectuate the Limited Benefit Amount, any such notice consistent with the requirements of Section 409A of the Code to avoid the imputation of any tax, penalty or interest thereunder, the Company shall reduce or eliminate the Benefits by first reducing or eliminating those payments or benefits which are not payable in cash and then by reducing or eliminating cash payments, in each case in reverse order beginning with payments or benefits which are to be paid the farthest in time from the Determination (as hereinafter defined). Any notice given by the Executive pursuant to the preceding sentence shall take precedence over the provisions of any other plan, arrangement or agreement governing the Executive’s rights and entitlements to any benefits or compensation.

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(b) A determination as to whether the Benefits shall be reduced to the Limited Benefit Amount pursuant to this Agreement and the amount of such Limited Benefit Amount shall be made by the Company’s independent public accountants or another certified public accounting firm of national reputation designated by the Company (the “Accounting Firm”) at the Company’s expense. The Accounting Firm shall provide its determination (the “Determination”), together with detailed supporting calculations and documentation to the Company and the Executive within ten (10) business days of the date of termination of the Executive’s employment, if applicable, or such other time as requested by the Company or the Executive (provided the Executive reasonably believes that any of the Benefits may be subject to the Excise Tax), and if the Accounting Firm determines that no Excise Tax is payable by the Executive with respect to any Benefits, it shall furnish the Executive with an opinion reasonably acceptable to the Executive that no Excise Tax will be imposed with respect to any such Benefits. Unless the Executive provides written notice to the Company within ten (10) business days of the delivery of the Determination to the Executive that he disputes such Determination, the Determination shall be binding, final and conclusive upon the Company and the Executive.

6. Protective Covenants.

6.1 Confidential Information; Inventions.

(a) The Executive shall not disclose or use at any time, either during the Period of Employment or thereafter, any Confidential Information (as defined below) of which the Executive is or becomes aware, whether or not such information is developed by him, except to the extent that such disclosure or use is directly related to and required by the Executive’s performance in good faith of duties for the Company. The Executive will take all appropriate steps to safeguard Confidential Information in his possession and to protect it against disclosure, misuse, espionage, loss and theft. The Executive shall deliver to the Company at the termination of the Period of Employment, or at any time the Company may request, all memoranda, notes, plans, records, reports, computer tapes and software and other documents and data (and copies thereof) relating to the Confidential Information or the Work Product (as hereinafter defined) of the business of the Company or any of its Affiliates which the Executive may then possess or have under his control. Notwithstanding the foregoing, the Executive may truthfully respond to a lawful and valid subpoena or other legal process, but shall give the Company the earliest possible notice thereof, shall, as much in advance of the return date as possible, make available to the Company and its counsel the documents and other information sought, and shall assist the Company and such counsel in resisting or otherwise responding to such process.

(b) As used in this Agreement, the term “Confidential Information” means information that is not generally known to the public and that is used, developed or obtained by the Company in connection with its business, including, but not limited to, information, observations and data obtained by the Executive while employed by the Company or any predecessors thereof (including those obtained prior to the Effective Date) concerning (i) the business or affairs of the Company (or such predecessors), including business, marketing and mergers and acquisitions plans and strategies, (ii) products or services (including product road maps and strategies), (iii) fees, costs and pricing structures, (iv) designs, (v) analyses, (vi) drawings, photographs and reports, (vii) computer software, including operating systems, applications and program listings, (viii) flow charts, manuals and documentation, (ix) data bases, (x) accounting and business methods, (xi) inventions, devices, new developments, methods and processes, whether patentable or unpatentable and whether or not reduced to practice, (xii) suppliers, customers and clients, as well as supplier, customer or client lists, preferences and/or contracts and contract terms, (xiii) other copyrightable works, (xiv) all production methods, processes, technology and trade secrets, and (xv) all similar and related information in whatever form. Confidential Information will not include any information that has been published (other than a disclosure by the Executive in breach of this Agreement) in a form generally available to the public prior to the date the Executive proposes to disclose or use such information. Confidential Information will not be deemed to have been published merely because individual portions of the information have been separately published, but only if all material features comprising such information have been published in combination.

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(c) As used in this Agreement, the term “Work Product” means all inventions, innovations, improvements, technical information, systems, software developments, methods, designs, analyses, drawings, reports, service marks, trademarks, trade names, logos and all similar or related information (whether patentable or unpatentable, copyrightable, registerable as a trademark, reduced to writing, or otherwise) which relates to the Company’s or any of its Affiliates’ actual or anticipated business, research and development or existing or future products or services and which are conceived, developed or made by the Executive (whether or not during usual business hours, whether or not by the use of the facilities of the Company or any of its Affiliates, and whether or not alone or in conjunction with any other person) while employed by the Company (including those conceived, developed or made prior to the Effective Date) together with all patent applications, letters patent, trademark, trade name and service mark applications or registrations, copyrights and reissues thereof that may be granted for or upon any of the foregoing. All Work Product that the Executive may have discovered, invented or originated during his employment by the Company or any of its Affiliates prior to the Effective Date, that he may discover, invent or originate during the Period of Employment or at any time in the period of twelve (12) months after the Severance Date, shall be the exclusive property of the Company and its Affiliates, as applicable, and Executive hereby assigns all of Executive’s right, title and interest in and to such Work Product to the Company or its applicable Affiliate, including all intellectual property rights therein. Executive shall promptly disclose all Work Product to the Company, shall execute at the request of the Company any assignments or other documents the Company may deem necessary to protect or perfect its (or any of its Affiliates’, as applicable) rights therein, and shall assist the Company, at the Company’s expense, in obtaining, defending and enforcing the Company’s (or any of its Affiliates’, as applicable) rights therein. The Executive hereby appoints the Company as his attorney- in-fact to execute on his behalf any assignments or other documents deemed necessary by the Company to protect or perfect the Company, the Company’s (and any of its Affiliates’, as applicable) rights to any Work Product.

6.2 Restriction on Competition. The Executive agrees that if the Executive were to become employed by, or substantially involved in, the business of a competitor of the Company or any of its Affiliates during the twelve (12)/) month period following the Severance Date, it would be very difficult for the Executive not to rely on or use the Company’s and its Affiliates’ trade secrets and confidential information. Thus, to avoid the inevitable disclosure of the Company’s and its Affiliates’ trade secrets and confidential information, and to protect such trade secrets and confidential information and the Company’s and its Affiliates’ relationships and goodwill with customers, during the Period of Employment and for a period of twelve (12) months after the Severance Date, the Executive will not directly or indirectly through any other Person engage in, enter the employ of, render any services to, have any ownership interest in, nor participate in the financing, operation, management or control of, any Competing Business. For purposes of this Agreement, the phrase “directly or indirectly through any other Person engage in” shall include, without limitation, any direct or indirect ownership or profit participation interest in such enterprise, whether as an owner, stockholder, member, partner, joint venture or otherwise, and shall include any direct or indirect participation in such enterprise as an employee, consultant, director, officer, licensor of technology or otherwise. For purposes of this Agreement, “Competing Business” means a Person anywhere in the continental United States and elsewhere in the world, where the Company and its Affiliates engage in business, or reasonably anticipate engaging in business, on the Severance Date (the “Restricted Area”) that at any time during the Period of Employment has competed, or any and time during the twelve (12) month period following the Severance Date competes, with the Company or any of its Affiliates in any business related to telecommunications infrastructure. Nothing herein shall prohibit the Executive from being a passive owner of not more than 2% of the outstanding stock of any class of a corporation which is publicly traded, so long as the Executive has no active participation in the business of such corporation,

6.3 Non-Solicitation of Employees and Consultants. During the Period of Employment and for a period of twelve (12) months after the Severance Date, the Executive will not directly or indirectly through any other Person induce or attempt to induce any employee or independent contractor of the Company or any Affiliate of the Company to leave the employ or service, as applicable, of the Company or such Affiliate, or in any way interfere with the relationship between the Company or any such Affiliate, on the one hand, and any employee or independent contractor thereof, on the other hand.

6.4 Non-Interference with Customers. During the Period of Employment and for a period of twelve (12) months after the Severance Date, the Executive will not, directly or indirectly through any other Person, use any of the Company’s trade secrets to influence or attempt to influence customers, vendors, suppliers, licensors, lessors, joint ventures, associates, consultants, agents, or partners of the Company or any Affiliate of the Company to divert their business away from the Company or such Affiliate, and the Executive will not otherwise use the Company’s trade secrets to interfere with, disrupt or attempt to disrupt the business relationships, contractual or otherwise, between the Company or any Affiliate of the Company, on the one hand, and any of its or their customers, suppliers, vendors, lessors, licensors, joint ventures, associates, officers, employees, consultants, managers, partners, members or investors, on the other hand.

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6.5 Cooperation. Following the Executive’s last day of employment by the Company, the Executive shall reasonably cooperate with the Company and its Affiliates in connection with: (a) any internal or governmental investigation or administrative, regulatory, arbitral or judicial proceeding involving the Company and any Affiliates with respect to matters relating to the Executive’s employment with or service as a member of the Board or the board of directors of any Affiliate (collectively, “Litigation”); or (b) any audit of the financial statements of the Company or any Affiliate with respect to the period of time when the Executive was employed by the Company or any Affiliate (“Audit”). The Executive acknowledges that such cooperation may include, but shall not be limited to, the Executive making himself available to the Company or any Affiliate (or their respective attorneys or auditors) upon reasonable notice for: (i) interviews, factual investigations, and providing declarations or affidavits that provide truthful information in connection with any Litigation or Audit; (ii) appearing at the request of the Company or any Affiliate to give testimony without requiring service of a subpoena or other legal process; (iii) volunteering to the Company or any Affiliate pertinent information related to any Litigation or Audit; (iv) providing information and legal representations to the auditors of the Company or any Affiliate, in a form and within a time frame requested by the Board, with respect to the Company’s or any Affiliate’s opening balance sheet valuation of intangibles and financial statements for the period in which the Executive was employed by the Company or any Affiliate; and (v) turning over to the Company or any Affiliate any documents relevant to any Litigation or Audit that are or may come into the Executive’s possession. The Company shall reimburse the Executive for reasonable travel expenses incurred in connection with providing the services under this Section 6.5, including lodging and meals, upon the Executive’s submission of receipts. If, due to an actual or potential conflict of interest, it is necessary for the Executive to retain separate counsel in connection with providing the services under this Section 6.5, and such counsel is not otherwise supplied by and at the expense of the Company (pursuant to indemnification rights of the Executive or otherwise), the Company shall further reimburse the Executive for the reasonable fees and expenses of such separate counsel.

6.6 Understanding of Covenants. The Executive acknowledges that, in the course of his employment with the Company and/or its Affiliates and their predecessors, he has become familiar, or will become familiar, with the Company’s and its Affiliates’ and their predecessors’ trade secrets and with other confidential and proprietary information concerning the Company, its Affiliates and their respective predecessors and that his services have been and will be of special, unique and extraordinary value to the Company and its Affiliates. The Executive agrees that the foregoing covenants set forth in this Section 6 (together, the “Restrictive Covenants”) are reasonable and necessary to protect the Company’s and its Affiliates’ trade secrets and other confidential and proprietary information, good will, stable workforce, and customer relations.

Without limiting the generality of the Executive’s agreement in the preceding paragraph, the Executive (i) represents that he is familiar with and has carefully considered the Restrictive Covenants, (ii) represents that he is fully aware of his obligations hereunder, (iii) agrees to the reasonableness of the length of time, scope and geographic coverage, as applicable, of the Restrictive Covenants, (iv) agrees that the Company and its Affiliates currently conducts business throughout the Restricted Area, and (v) agrees that the Restrictive Covenants will continue in effect for the applicable periods set forth above in this Section 6 regardless of whether the Executive is then entitled to receive severance pay or benefits from the Company. The Executive understands that the Restrictive Covenants may limit his ability to earn a livelihood in a business similar to the business of the Company and any of its Affiliates, but he nevertheless believes that he has received and will receive sufficient consideration and other benefits as an employee of the Company and as otherwise provided hereunder or as described in the recitals hereto to clearly justify such restrictions which, in any event (given his education, skills and ability), the Executive does not believe would prevent him from otherwise earning a living. The Executive agrees that the Restrictive Covenants do not confer a benefit upon the Company disproportionate to the detriment of the Executive.

6.7 Enforcement. The Executive agrees that the Executive’s services are unique and that he has access to Confidential Information and Work Product. Accordingly, without limiting the generality of Section 17, the Executive agrees that a breach by the Executive of any of the covenants in this Section 6 would cause immediate and irreparable harm to the Company that would be difficult or impossible to measure, and that damages to the Company for any such injury would therefore be an inadequate remedy for any such breach. Therefore, the Executive agrees that in the event of any breach or threatened breach of any provision of this Section 6, the Company shall be entitled, in addition to and without limitation upon all other remedies the Company may have under this Agreement, at law or otherwise, to obtain specific performance, injunctive relief and/or other appropriate relief (without posting any bond or deposit) in order to enforce or prevent any violations of the provisions of this Section 6, or require the Executive to account for and pay over to the Company all compensation, profits, moneys, accruals, increments or other benefits derived from or received as a result of any transactions constituting a breach of this Section 6 if and when final judgment of a court of competent jurisdiction or arbitrator, as applicable, is so entered against the Executive. The Executive further agrees that the applicable period of time any Restrictive Covenant is in effect following the Severance Date, as determined pursuant to the foregoing provisions of this Section 6, such period of time shall be extended by the same amount of time that Executive is in breach of any Restrictive Covenant.

7. Withholding Taxes. Notwithstanding anything else herein to the contrary, the Company may withhold (or cause there to be withheld, as the case may be) from any amounts otherwise due or payable under or pursuant to this Agreement such federal, state and local income, employment, or other taxes as may be required to be withheld pursuant to any applicable law or regulation. Except for such withholding rights, the Executive is solely responsible for any and all tax liability that may arise with respect to the compensation provided under or pursuant to this Agreement.

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8. Successors and Assigns.

(a) This Agreement is personal to the Executive and without the prior written consent of the Company shall not be assignable by the Executive otherwise than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’s legal representatives.

(b) This Agreement shall inure to the benefit of and be binding upon the Company and its successors and assigns. Without limiting the generality of the preceding sentence, the Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. As used in this Agreement, “Company” shall mean the Company as hereinbefore defined and any successor or assignee, as applicable, which assumes and agrees to perform this Agreement by operation of law or otherwise.

9. Number and Gender; Examples. Where the context requires, the singular shall include the plural, the plural shall include the singular, and any gender shall include all other genders. Where specific language is used to clarify by example a general statement contained herein, such specific language shall not be deemed to modify, limit or restrict in any manner the construction of the general statement to which it relates.

10. Section Headings. The section headings of, and titles of paragraphs and subparagraphs contained in, this Agreement are for the purpose of convenience only, and they neither form a part of this Agreement nor are they to be used in the construction or interpretation thereof.

11. Governing Law. This Agreement will be governed by and construed in accordance with the laws of the state of Florida, without giving effect to any choice of law or conflicting provision or rule (whether of the state of Florida or any other jurisdiction) that would cause the laws of any jurisdiction other than the state of Florida to be applied. In furtherance of the foregoing, the internal law of the state of Florida will control the interpretation and construction of this Agreement, even if under such jurisdiction’s choice of law or conflict of law analysis, the substantive law of some other jurisdiction would ordinarily apply.

12. Severability. It is the desire and intent of the parties hereto that the provisions of this Agreement be enforced to the fullest extent permissible under the laws and public policies applied in each jurisdiction in which enforcement is sought. Accordingly, if any particular provision of this Agreement shall be adjudicated by a court of competent jurisdiction to be invalid, prohibited or unenforceable under any present or future law, and if the rights and obligations of any party under this Agreement will not be materially and adversely affected thereby, such provision, as to such jurisdiction, shall be ineffective, without invalidating the remaining provisions of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction, and to this end the provisions of this Agreement are declared to be severable; furthermore, in lieu of such invalid or unenforceable provision there will be added automatically as a part of this Agreement, a legal, valid and enforceable provision as similar in terms to such invalid or unenforceable provision as may be possible. Notwithstanding the foregoing, if such provision could be more narrowly drawn (as to geographic scope, period of duration or otherwise) so as not to be invalid, prohibited or unenforceable in such jurisdiction, it shall, as to such jurisdiction, be so narrowly drawn, without invalidating the remaining provisions of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction.

13. Entire Agreement. This Agreement embodies the entire agreement of the parties hereto respecting the matters within its scope. This Agreement supersedes all prior and contemporaneous agreements of the parties hereto that directly or indirectly bears upon the subject matter hereof (including, without limitation, the Prior Employment Agreement). Any prior negotiations, correspondence, agreements, proposals or understandings relating to the subject matter hereof shall be deemed to have been merged into this Agreement, and to the extent inconsistent herewith, such negotiations, correspondence, agreements, proposals, or understandings shall be deemed to be of no force or effect. There are no representations, warranties, or agreements, whether express or implied, or oral or written, with respect to the subject matter hereof, except as expressly set forth herein.

14. Modifications. This Agreement may not be amended, modified or changed (in whole or in part), except by a formal, definitive written agreement expressly referring to this Agreement, which agreement is executed by both of the parties hereto.

15. Waiver. Neither the failure nor any delay on the part of a party to exercise any right, remedy, power or privilege under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power or privilege preclude any other or further exercise of the same or of any right, remedy, power or privilege, nor shall any waiver of any right, remedy, power or privilege with respect to any occurrence be construed as a waiver of such right, remedy, power or privilege with respect to any other occurrence. No waiver shall be effective unless it is in writing and is signed by the party asserted to have granted such waiver.

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16. Arbitration. Except as provided in Sections 6.6 and 17, Executive and the Company agree that any controversy arising out of or relating to this Agreement, its enforcement or interpretation, or because of an alleged breach, default, or misrepresentation in connection with any of its provisions, or any other controversy arising out of Executive’s employment, including, but not limited to, any state or federal statutory claims, shall be submitted to arbitration in [Miami, Florida], before a sole arbitrator (the “Arbitrator”) selected from the American Arbitration Association, as the exclusive forum for the resolution of such dispute; provided, however, that provisional injunctive relief may, but need not, be sought by either party to this Agreement in a court of law while arbitration proceedings are pending, and any provisional injunctive relief granted by such court shall remain effective until the matter is finally determined by the Arbitrator. Final resolution of any dispute through arbitration may include any remedy or relief which the Arbitrator deems just and equitable, including any and all remedies provided by applicable state or federal statutes. At the conclusion of the arbitration, the Arbitrator shall issue a written decision that sets forth the essential findings and conclusions upon which the Arbitrator’s award or decision is based. Any award or relief granted by the Arbitrator hereunder shall be final and binding on the parties hereto and may be enforced by any court of competent jurisdiction. The parties acknowledge and agree that they are hereby waiving any rights to trial by jury in any action, proceeding or counterclaim brought by either of the parties against the other in connection with any matter whatsoever arising out of or in any way connected with this Agreement or Executive’s employment. The parties agree that the Company shall be responsible for payment of the forum costs of any arbitration hereunder, including the Arbitrator’s fee, but that each party shall bear its own attorney’s fees and other expenses.

17. Remedies. Each of the parties to this Agreement and any such person or entity granted rights hereunder whether or not such person or entity is a signatory hereto shall be entitled to enforce its rights under this Agreement specifically to recover damages and costs for any breach of any provision of this Agreement and to exercise all other rights existing in its favor. The parties hereto agree and acknowledge that money damages may not be an adequate remedy for any breach of the provisions of this Agreement and that each party may in its sole discretion apply to any court of law or equity of competent jurisdiction for provisional injunctive or equitable relief and/or other appropriate equitable relief (without posting any bond or deposit) in order to enforce or prevent any violations of the provisions of this Agreement. Each party shall be responsible for paying its own attorneys’ fees, costs and other expenses pertaining to any such legal proceeding and enforcement regardless of whether an award or finding or any judgment or verdict thereon is entered against either party.

18. Notices. Any notice provided for in this Agreement must be in writing and must be either personally delivered, transmitted via telecopier, mailed by first class mail (postage prepaid and return receipt requested) or sent by reputable overnight courier service (charges prepaid) to the recipient at the address below indicated or at such other address or to the attention of such other person as the recipient party has specified by prior written notice to the sending party. Notices will be deemed to have been given hereunder and received when delivered personally, when received if transmitted via telecopier, five days after deposit in the U.S. mail and one day after deposit with a reputable overnight courier service.

if to the Company:

Spectrum Global Solutions, Inc.

C/O: AW Solutions, Inc.

300 Crown Oak Centre Drive Longwood, Florida 32750

Attention: President/COO

with a copy to:

Pryor, Cashman

PRYOR CASHMAN LLP

7 Times Square, New York, NY 10036-6569

Attention: Ali Panjwani, Esq

if to the Executive, to the address most recently on file in the payroll records of the Company.

19. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original as against any party whose signature appears thereon, and all of which together shall constitute one and the same instrument. This Agreement shall become binding when one or more counterparts hereof, individually or taken together, shall bear the signatures of all of the parties reflected hereon as the signatories. Photographic copies of such signed counterparts may be used in lieu of the originals for any purpose.

20. Legal Counsel; Mutual Drafting. Each party recognizes that this is a legally binding contract and acknowledges and agrees that they have had the opportunity to consult with legal counsel of their choice. Each party has cooperated in the drafting, negotiation and preparation of this Agreement. Hence, in any construction to be made of this Agreement, the same shall not be construed against either party on the basis of that party being the drafter of such language. The Executive agrees and acknowledges that he has read and understands this Agreement, is entering into it freely and voluntarily, and has been advised to seek counsel prior to entering into this Agreement and has had ample opportunity to do so.

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21. Section 409A.

(a) It is intended that any amounts payable under this Agreement shall either be exempt from or comply with Section 409A of the Code (including the Treasury regulations and other published guidance relating thereto) (“Code Section 409A”) so as not to subject the Executive to payment of any additional tax, penalty or interest imposed under Code Section 409A. The provisions of this Agreement shall be construed and interpreted to avoid the imputation of any such additional tax, penalty or interest under Code Section 409A yet preserve (to the nearest extent reasonably possible) the intended benefit payable to the Executive.

(b) If the Executive is a “specified employee” within the meaning of Treasury Regulation Section 1.409A-1(i) as of the date of the Executive’s Separation from Service, the Executive shall not be entitled to any payment or benefit pursuant to Section 5.3(b) or (c) until the earlier of (i) the date which is six (6) months after his or her Separation from Service for any reason other than death, or (ii) the date of the Executive’s death. The provisions of this Section 21(b) shall only apply if, and to the extent, required to avoid the imputation of any tax, penalty or interest pursuant to Code Section 409A. Any amounts otherwise payable to the Executive upon or in the six (6) month period following the Executive’s Separation from Service that are not so paid by reason of this Section 21(b) shall be paid (without interest) as soon as practicable (and in all events within thirty (30) days) after the date that is six (6) months after the Executive’s Separation from Service (or, if earlier, as soon as practicable, and in all events within thirty (30) days, after the date of the Executive’s death).

(c) To the extent that any benefits pursuant to Section 5.3(b)(ii) or reimbursements pursuant to Section 4.2 are taxable to the Executive, any reimbursement payment due to the Executive pursuant to any such provision shall be paid to the Executive on or before the last day of the Executive’s taxable year following the taxable year in which the related expense was incurred. The benefits and reimbursements pursuant to such provisions are not subject to liquidation or exchange for another benefit and the amount of such benefits and reimbursements that the Executive receives in one taxable year shall not affect the amount of such benefits or reimbursements that the Executive receives in any other taxable year.

[The remainder of this page has intentionally been left blank.]

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IN WITNESS WHEREOF, the Company and the Executive have executed this Agreement as of the Effective Date.

“COMPANY”
Spectrum Global Solutions, Inc.,
a Nevada Corporation
By:
Name:	Keith Hayter
Title:	President
“EXECUTIVE”
Roger Ponder

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EX-10.2

Exhibit 10.2

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into this 1st day of June 2018 (the “Effective Date”), by and between Spectrum Global Solutions, Inc., a Nevada Corporation (the “Company”), and Keith Hayter (the “Executive”).

RECITALS

THE PARTIES ENTER THIS AGREEMENT on the basis of the following facts, understandings and intentions:

A. The Company desires to employ the Executive, and the Executive desires to accept such employment, on the terms and conditions set forth in this Agreement.

B. This Agreement shall be effective immediately and shall govern the employment relationship between the Executive and the Company from and after the Effective Date, and, as of the Effective Date, supersedes and negates all previous agreements and understandings with respect to such relationship (the “Prior Employment Agreement”).

AGREEMENT

NOW, THEREFORE, in consideration of the above recitals incorporated herein and the mutual covenants and promises contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby expressly acknowledged, the parties agree as follows:

1. Retention and Duties.

1.1 Retention. The Company does hereby hire, engage and employ the Executive for the Period of Employment (as such term is defined in Section 2) on the terms and conditions expressly set forth in this Agreement. The Executive does hereby accept and agree to such hiring, engagement and employment, on the terms and conditions expressly set forth in this Agreement. Certain capitalized terms used herein are defined in Section 5.5 of this Agreement.

1.2 Duties.  During the Period of Employment, the Executive shall serve the Company as its President ("President”) and shall have the powers, authorities, duties and obligations of management usually vested in such position for a company of a similar size and similar nature of the Company, and such other powers, authorities, duties and obligations commensurate with such positions as the Company’s Board of Directors (the “Board”) may assign from time to time, all subject to the directives of the Board, and the corporate policies of the Company as they are in effect from time to time throughout the Period of Employment (including, without limitation, the Company’s employee handbook, business conduct and ethics policies, and other personnel policies, as they may change from time to time). During the Period of Employment, the Executive shall report to the Board.

1.3 No Other Employment; Minimum Time Commitment. During the Period of Employment, the Executive shall (i) devote substantially all of the Executive’s business time, energy and skill to the performance of the Executive’s duties for the Company, (ii) perform such duties in a faithful, effective and efficient manner to the best of his abilities, and (iii) hold no other employment without the express written approval of the Board. The Executive’s service on the boards of directors (or similar body) of other business entities is subject to the approval of the Board. The Company shall have the right to require the Executive to resign from any board or similar body (including, without limitation, any association, corporate, civic or charitable board or similar body) which he may then serve if the Board reasonably determines that the Executive’s service on such board or body interferes with the effective discharge of the Executive’s duties and responsibilities to the Company or that any business related to such service is then in competition with any business of the Company or any of its Affiliates, successors or assigns.

1.4 No Breach of Contract. The Executive hereby represents to the Company and agrees that: (i) the execution and delivery of this Agreement by the Executive and the Company and the performance by the Executive of the Executive’s duties hereunder do not and shall not constitute a breach of, conflict with, or otherwise contravene or cause a default under, the terms of any other agreement or policy to which the Executive is a party or otherwise bound or any judgment, order or decree to which the Executive is subject; (ii) the Executive will not enter into any new agreement that would or reasonably could contravene or cause a default by the Executive under this Agreement; (iii) the Executive has no information (including, without

1.5 limitation, confidential information and trade secrets) relating to any other Person which would prevent, or be violated by, the Executive entering into this Agreement or carrying out his duties hereunder; (iv) the Executive is not bound by any employment, consulting, non-compete, confidentiality, trade secret or similar agreement (other than this Agreement) with any other Person; (v) to the extent the Executive has any confidential or similar information that he is not free to disclose to the Company, he will not disclose such information to the extent such disclosure would violate applicable law or any other agreement or policy to which the Executive is a party or by which the Executive is otherwise bound; and (vi) the Executive understands the Company will rely upon the accuracy and truth of the representations and warranties of the Executive set forth herein and the Executive consents to such reliance.

1.6 Location. The Executive’s principal place of employment shall be the Company’s offices in Florida.

2. Period of Employment. The “Period of Employment” shall be a period of three (3) years commencing on the Effective Date and ending at the close of business on the third anniversary of the Effective Date (the “Termination Date”); provided, however, that this Agreement shall be automatically renewed, and the Period of Employment shall be automatically extended for one (1) additional year on the Termination Date and each anniversary of the Termination Date thereafter, unless either party gives written notice at least sixty (60) days prior to the expiration of the Period of Employment (including any renewal thereof) of such party’s desire to terminate the Period of Employment (such notice to be delivered in accordance with Section 18). The term “Period of Employment” shall include any extension thereof pursuant to the preceding sentence. Provision of notice that the Period of Employment shall not be extended or further extended, as the case may be, shall not constitute a breach of this Agreement and shall not constitute “Good Reason” for purposes of this Agreement. Notwithstanding the foregoing, the Period of Employment is subject to earlier termination as provided below in this Agreement.

3. Compensation.

3.1 Base Salary. During the Period of Employment, the Company shall pay the Executive a base salary (the “Base Salary”), which shall be paid in accordance with the Company’s regular payroll practices in effect from time to time but not less frequently than in monthly installments. The Executive’s Base Salary shall be at an annualized rate of Three Hundred and Forty Thousand Dollars ($340,000). The Board (or a committee thereof) may, in its sole discretion, increase (but not decrease) the Executive’s rate of Base Salary.

3.2 Incentive Bonus. Commencing on the Effective Date, the Executive shall be eligible to receive an incentive bonus for each fiscal year of the Company that occurs during the Period of Employment (“Incentive Bonus”). Notwithstanding the foregoing and except as otherwise expressly provided in this Agreement, the Executive must be employed by the Company at the time the Company pays incentive bonuses to employees generally with respect to a particular fiscal year in order to be eligible for an Incentive Bonus for that year (and, if the Executive is not so employed at such time, in no event shall he have been considered to have “earned” any Incentive Bonus with respect to the fiscal year). The Executive’s target Incentive Bonus amount for a particular fiscal year of the Company shall equal no less than 60% of the Executive’s Base Salary paid by the Company to the Executive for that fiscal year; provided that the Executive’s actual Incentive Bonus amount for a particular fiscal year shall be determined by the Board (or a committee thereof) in its sole discretion, based on performance objectives (which may include corporate, business unit or division, financial, strategic, individual or other objectives) established with respect to that particular fiscal year by the Board (or a committee thereof).

3.3 Stock Option Grant. Subject to approval by the Board (or a committee thereof), the Company will grant the Executive a stock option (the “Option”) to purchase shares determined by the Board of Directors of the Company’s common stock at a price per share not less than the per-share fair market value of the common stock on the date of grant, as reasonably determined by the Board (or a committee thereof). The Option will vest with respect to twenty- five percent (25%) of the shares subject to the Option on the first anniversary of the grant date of the Option. The remaining seventy-five percent (75%) of the shares subject to the Option will vest in 24 months substantially equal monthly installments thereafter. In each case, the vesting of the Option is subject to the Executive’s continued employment by the Company through the respective vesting date. The maximum term of the Option will be ten (10) years, subject to earlier termination upon the termination of the Executive’s employment with the Company, a change in control of the Company and similar events. The Option shall be intended as an “incentive stock option” under Section 422 of the Internal Revenue Code, as amended (the “Code”), subject to the terms and conditions of Section 422 of the Code (including, without limitation, the Code limitation on the number of options that may become exercisable in any given year and still qualify as such an incentive stock option). The Option shall be granted under the Company’s Performance Incentive Plan and shall be subject to such further terms and conditions as set forth in the Company’s standard form of award agreement for stock options granted under the plan.

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3.4 Sign On Stock Option Grant. Subject to approval by the Board (or a committee thereof), the Company will grant the Executive a stock option (the “Sign On Option”) to purchase XXX, XXX shares of the Company’s common stock at a price per share not less than the per-share fair market value of the common stock on the date of grant, as reasonably determined by the Board (or a committee thereof). The Option will vest immediately. The maximum term of the Option will be ten (10) years, subject to earlier termination upon the termination of the Executive’s employment with the Company, a change in control of the Company and similar events. The Option shall be intended as an “incentive stock option” under Section 422 of the Internal Revenue Code, as amended (the “Code”), subject to the terms and conditions of Section 422 of the Code (including, without limitation, the Code limitation on the number of options that may become exercisable in any given year and still qualify as such an incentive stock option). The Option shall be granted under the Company’s Performance Incentive Plan and shall be subject to such further terms and conditions as set forth in the Company’s standard form of award agreement for stock options granted under the plan.

4. Benefits.

4.1 Retirement. Welfare and Fringe Benefits. During the Period of Employment, the Executive shall be entitled to participate in all employee pension and welfare benefit plans and programs, and fringe benefit plans and programs, made available by the Company to the Company’s employees generally, in accordance with the eligibility and participation provisions of such plans and as such plans or programs may be in effect from time to time.

4.2 Reimbursement of Business Expenses. The Executive is authorized to incur reasonable expenses in carrying out the Executive’s duties for the Company under this Agreement and shall be entitled to reimbursement for all reasonable business expenses the Executive incurs during the Period of Employment in connection with carrying out the Executive’s duties for the Company, subject to the Company’s expense reimbursement policies and any pre-approval policies in effect from time to time. The Executive agrees to promptly submit and document any reimbursable expenses in accordance with the Company’s expense reimbursement policies to facilitate the timely reimbursement of such expenses.

4.3 Vacation and Other Leave. During the Period of Employment, the Executive’s annual rate of vacation accrual shall be four (4) weeks per year, with such vacation to accrue and be subject to the Company’s vacation policies in effect from time to time, including any policy which may limit vacation accruals and/or limit the amount of accrued but unused vacation to carry over from year to year. The Executive shall also be entitled to all other holiday and leave pay generally available to other executives of the Company.

5. Termination.

5.1 Termination by the Company. The Executive’s employment by the Company, and the Period of Employment, may be terminated at any time by the Company:

(i) with Cause, with no less than thirty (30) days advance written notice to the Executive (such notice to be delivered in accordance with Section 18), or (iii) in the event of the Executive’s death, or (iv) in the event that the Board determines in good faith that the Executive has a Disability.

5.2 Termination by the Executive. The Executive’s employment by the Company, and the Period of Employment, may be terminated by the Executive with no less than thirty (30) days advance written notice to the Company (such notice to be delivered in accordance with Section 18); provided, however, that in the case of a termination for Good Reason or a Change of Control event as defined herein, the Executive may provide immediate written notice of termination once the applicable cure period (as contemplated by the definition of Good Reason) has lapsed if the Company has not reasonably cured the circumstances that gave rise to the basis for the Good Reason termination.

5.3 Benefits upon Termination. If the Executive’s employment by the Company is terminated during the Period of Employment for any reason by the Company or by the Executive, upon change of control event (section5.5d), or upon or following the expiration of the Period of Employment (in any case, the date that the Executive’s employment by the Company terminates is referred to as the “Severance Date”), the Company shall have no further obligation to make or provide to the Executive, and the Executive shall have no further right to receive or obtain from the Company, any payments or benefits except as follows:

(a) The Company shall pay the Executive (or, in the event of his death, the Executive’s estate) any Accrued Obligations;

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(b) If, during the Period of Employment, the Executive’s employment with the Company terminates as a result of a termination by the Company without Cause (other than due to the Executive’s death or Disability) or a resignation by the Executive for Good Reason, the Executive shall be entitled to the following benefits:

(i) The Company shall pay the Executive (in addition to the Accrued Obligations), subject to tax withholding and other authorized deductions, an amount equal to the sum of twenty-four (24) months of Executive’s Base Salary at the monthly rate in effect on the Severance Date, plus two (2) times the Executive’s Target Bonus for the fiscal year of the Company in which the Severance Date occurs. Such amount is referred to hereinafter as the “Severance Benefit.” Subject to Section 21(b), the Company shall pay the Severance Benefit to the Executive in a lump sum or, at the option of the Executive, in equal monthly installments (rounded down to the nearest whole cent) over a period of twelve (12) consecutive months, with the first installment payable on (or within ten (10) days following) the sixtieth (60th) day following the Executive’s Separation from Service.

(ii) The Company will pay or reimburse the Executive for his premiums charged to continue medical coverage pursuant to the Consolidated Omnibus Budget Reconciliation Act (“COBRA”), at the same or reasonably equivalent medical coverage for the Executive (and, if applicable, the Executive’s eligible dependents) as in effect immediately prior to the Severance Date, to the extent that the Executive elects such continued coverage; provided that the Company’s obligation to make any payment or reimbursement pursuant to this clause (ii) shall, subject to Section 21(b), commence with continuation coverage for the month following the month in which the Executive’s Separation from Service occurs and shall cease with continuation coverage for the twelve month (12th) month following the month in which the Executive’s Separation from Service occurs (or, if earlier, shall cease upon the first to occur of the Executive’s death, the date the Executive becomes eligible for coverage under the health plan of a future employer, or the date the Company ceases to offer group medical coverage to its active executive employees or the Company is otherwise under no obligation to offer COBRA continuation coverage to the Executive). To the extent the Executive elects COBRA coverage, he shall notify the Company in writing of such election prior to such coverage taking effect and complete any other continuation coverage enrollment procedures the Company may then have in place

(iii) The Company shall promptly pay to the Executive any Incentive Bonus that would otherwise be paid to the Executive had his employment by the Company not terminated with respect to any fiscal year that ended before the Severance Date, to the extent not theretofore paid (such payment to be made at the time bonuses for the fiscal year are paid to the Company’s executives generally).

(iv) As to each then-outstanding stock option and other equity-based award granted by the Company to the Executive that vests based solely on the Executive’s continued service with the Company, the Executive shall vest as of the Severance Date in any portion of such award in which the Executive would have vested thereunder if the Executive’s employment with the Company had continued for twelve (12) months after the Severance Date (and any portion of such award that is not vested after giving effect to this acceleration provision shall terminate on the Severance Date). As to each outstanding stock option or other equity-based award granted by the Company to the Executive that is subject to performance-based vesting requirements, the vesting of such award will continue to be governed by its terms, provided that for purposes of any service-based vesting requirement under such award, the Executive’s employment with the Company will be deemed to have continued for Twelve (12) months after the Severance Date. Notwithstanding the foregoing, if the Severance Date occurs on or after the date of a Change in Control Event, each stock option and other equity-based award granted by the Company to the Executive, to the extent then outstanding and unvested, shall be fully vested as of the Severance Date.

(c) If, during the Period of Employment, the Executive’s employment with the Company terminates as a result of the Executive’s death or Disability, the Company shall pay the Executive the amount by Section 5.3(b)(iii).

(d) Notwithstanding the foregoing provisions of this Section 5.3, if the Executive breaches his obligations under Section 6 of this Agreement at any time, from and after the date of such breach and not in any way in limitation of any right or remedy otherwise available to the Company, the Executive will no longer be entitled to, and the Company will no longer be obligated to pay, any remaining unpaid portion of the Severance Benefit or any remaining unpaid amount contemplated by Section 5.3(b)(iii) or 5.3(c), or to any continued Company-paid or reimbursed coverage pursuant to Section 5.3(b)(ii); provided that, if the Executive provides the Release contemplated by Section 5.4, in no event shall the Executive be entitled to benefits pursuant to Section 5.3(b) or 5.3(c), as applicable, of less than $5,000 (or the amount of such benefits, if less than $5,000), which amount the parties agree is good and adequate consideration, in and of itself, for the Executive’s Release contemplated by Section 5.4.

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(e) The foregoing provisions of this Section 5.3 shall not affect: (i) the Executive’s receipt of benefits otherwise due terminated employees under group insurance coverage consistent with the terms of the applicable Company welfare benefit plan; (ii) the Executive’s rights under COBRA to continue health coverage; or (iii) the Executive’s receipt of benefits otherwise due in accordance with the terms of the Company’s 401(k) plan (if any).

5.4 Release; Exclusive Remedy; Leave.

(a) This Section 5.4 shall apply notwithstanding anything else contained in this Agreement or any stock option or other equity-based award agreement to the contrary. As a condition precedent to any Company obligation to the Executive pursuant to Section 5.3(b) or 5.3(c) or any other obligation to accelerate vesting of any equity-based award in connection with the termination of the Executive’s employment, the Executive shall provide the Company with a valid, executed general release agreement in substantially the form attached hereto as Exhibit A (with such changes as may be reasonably required to such form to help ensure its enforceability in light of any changes in applicable law) (the “Release”), and such Release shall have not been revoked by the Executive pursuant to any revocation rights afforded by applicable law. The Company shall provide the final form of Release to the Executive not later than seven (7) days following the Severance Date, and the Executive shall be required to execute and return the Release to the Company within twenty-one (21) days (or forty-five (45) days if such longer period of time is required to make the Release maximally enforceable under applicable law) after the Company provides the form of Release to the Executive.

(b) The Executive agrees that the payments and benefits contemplated by Section 5.3 (and any applicable acceleration of vesting of an equity-based award in accordance with the terms of such award in connection with the termination of the Executive’s employment) shall constitute the exclusive and sole remedy for any termination of his employment and the Executive covenants not to assert or pursue any other remedies, at law or in equity, with respect to any termination of employment. The Company and the Executive acknowledge and agree that there is no duty of the Executive to mitigate damages under this Agreement. All amounts paid to the Executive pursuant to Section 5.3 shall be paid without regard to whether the Executive has taken or takes actions to mitigate damages. The Executive agrees to resign, on the Severance Date, as an officer and director of the Company and any Affiliate of the Company, and as a fiduciary of any benefit plan of the Company or any Affiliate of the Company, and to promptly execute and provide to the Company any further documentation, as requested by the Company, to confirm such resignation.

(c) In the event that the Company provides the Executive notice of termination without Cause pursuant to Section 5.1 or the Executive provides the Company notice of termination pursuant to Section 5.2, the Company will have the option to place the Executive on paid administrative leave during the notice period.

5.5 Certain Defined Terms.

(a) As used herein, “Accrued Obligations” means:

(i) any Base Salary that had accrued but had not been paid on or before the Severance Date;

(ii) any accrued but unused vacation as of the Severance Date; and

(iii) any reimbursement due to the Executive pursuant to Section 4.2 for expenses reasonably incurred by the Executive on or before the Severance Date and documented and pre-approved, to the extent applicable, in accordance with the Company’s expense reimbursement policies in effect at the applicable time.

(b) As used herein, “Affiliate” of the Company means a Person that directly or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the Company. As used in this definition, the term “control,” including the correlative terms “controlling,” “controlled by” and “under common control with,” means the possession, directly or indirectly, of the power to direct or cause the direction of management or policies (whether through ownership of securities or any partnership or other ownership interest, by contract or otherwise) of a Person.

(c) As used herein, “Cause” shall mean, as reasonably determined by the Board (excluding the Executive, if he is then a member of the Board) based on the information then known to it, that one or more of the following has occurred:

(i) the Executive is convicted of, pled guilty or pled nolo contendere to a felony (under the laws of the United States or any relevant state, or a similar crime or offense under the applicable laws of any relevant foreign jurisdiction);

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(ii) the Executive has engaged in acts of fraud, dishonesty or other acts of willful misconduct in the course of his duties hereunder;

(iii) the Executive willfully fails to perform or uphold his duties under this Agreement and/or willfully fails to comply with reasonable directives of the Board; or

(iv) a breach by the Executive of any other provision of Section 6, or any material breach by the Executive of any other contract he is a party to with the Company or any of its Affiliates.

(d) As used herein, “Change in Control Event” shall mean

(i) The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of more than 30% of either (1) the then-outstanding shares of common stock of the Company (the “Outstanding Company Common Stock”) or (2) the combined voting power of the then-outstanding voting securities of the Company entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”); provided, however, that, for purposes of this clause (a), the following acquisitions shall not constitute a Change in Control Event; (A) any acquisition directly from the Company, (B) any acquisition by the Company, (C) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any affiliate of the Company or a successor, (D) any acquisition by any entity pursuant to a transaction that complies with Sections (iii)(1), (2) and (3) of this definition below, (E) any acquisition by a Person described in and satisfying the conditions of Rule 13d-1(b) promulgated under the Exchange Act, or (F) any acquisition by a Person who is the beneficial owner (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 30% or more of the Outstanding Company Common Stock and/or the Outstanding Company Voting Securities on the Effective Date (or an affiliate, heir, descendant, or related party of or to such Person);

(ii) Individuals who, as of the Effective Date, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the Effective Date whose election, or nomination for election by the Company’s stockholders, was approved by a vote of at least two-thirds of the directors then comprising the Incumbent Board (including for these purposes, the new members whose election or nomination was so approved, without counting the member and his predecessor twice) shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board;

(iii) Consummation of a reorganization, merger, statutory share exchange or consolidation or similar corporate transaction involving the Company or any of its Subsidiaries, a sale or other disposition of all or substantially all of the assets of the Company, or the acquisition of assets or stock of another entity by the Company or any of its Subsidiaries (each, a “Business Combination”), in each case unless, following such Business Combination, (1) all or substantially all of the individuals and entities that were the beneficial owners of the Outstanding Company Common Stock and the Outstanding Company Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 50% of the then-outstanding shares of common stock and the combined voting power of the then-outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the entity resulting from such Business Combination (including, without limitation, an entity that, as a result of such transaction, owns the Company or all or substantially all of the Company’s assets directly or through one or more subsidiaries (a “Parent”)) in substantially the same proportions as their ownership immediately prior to such Business Combination of the Outstanding Company Common Stock and the Outstanding Company Voting Securities, as the case may be, (2) no Person (excluding any entity resulting from such Business Combination or a Parent or any employee benefit plan (or related trust) of the Company or such entity resulting from such Business Combination or Parent) beneficially owns, directly or indirectly, more than 30% of, respectively, the then-outstanding shares of common stock of the entity resulting from such Business Combination or the combined voting power of the then-outstanding voting securities of such entity, except to the extent that the ownership in excess of 30% existed prior to the Business Combination, and (3) at least a majority of the members of the board of directors or trustees of the entity resulting from such Business Combination or a Parent were members of the Incumbent Board at the time of the execution of the initial agreement or of the action of the Board providing for such Business Combination; or

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(iv) Approval by the stockholders of the Company of a complete liquidation or dissolution of the Company other than in the context of a transaction that does not constitute a Change in Control Event under clause (iii) above.

(e) As used herein, “Disability” shall mean a physical or mental impairment which, as reasonably determined by the Board, renders the Executive unable to perform the essential functions of his employment with the Company, even with reasonable accommodation that does not impose an undue hardship on the Company, for more than 90 days in any 180-day period, unless a longer period is required by federal or state law, in which case that longer period would apply.

(f) As used herein, “Good Reason” shall mean the occurrence (without the Executive’s consent) of any one or more of the following conditions:

(i) a material diminution in the Executive’s rate of Base Salary; greater than 10 %

(ii) a material diminution in the Executive’s authority, duties, or responsibilities; any change in current reporting structure or personnel

(iii) a material change in the geographic location of the Executive’s principal office with the Company (for this purpose, in no event shall a relocation of such office to a new location that is not more than fifteen (15) miles from the current location of the Company’s executive offices constitute a “material change”); or

(iv) a material breach by the Company of this Agreement;

provided, however, that any such condition or conditions, as applicable, shall not constitute Good Reason unless both (x) the Executive provides written notice to the Company of the condition claimed to constitute Good Reason within sixty (60) days of the initial existence of such condition(s) (such notice to be delivered in accordance with Section 18), and (y) the Company fails to remedy such condition(s) within thirty (30) days of receiving such written notice thereof; and provided, further, that in all events the termination of the Executive’s employment with the Company shall not constitute a termination for Good Reason unless such termination occurs not more than one hundred and twenty (120) days following the initial existence of the condition claimed to constitute Good Reason.

(g) As used herein, the term “Person” shall be construed broadly and shall include, without limitation, an individual, a partnership, a limited liability company, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof.

(h) As used herein, a “Separation from Service” occurs when the Executive dies, retires, or otherwise has a termination of employment with the Company that constitutes a “separation from service” within the meaning of Treasury Regulation Section 1.409A-1(h)(1), without regard to the optional alternative definitions available thereunder.

5.6. Notice of Termination. Any termination of the Executive’s employment under this Agreement shall be communicated by written notice of termination from the terminating party to the other party. This notice of termination must be delivered in accordance with Section 18 and must indicate the specific provision(s) of this Agreement relied upon in effecting the termination.

5.7 Limitation on Benefits.

(a) Notwithstanding anything contained in this Agreement to the contrary, to the extent that the payments and benefits provided under this Agreement and benefits provided to, or for the benefit of, the Executive under any other Company plan or agreement (such payments or benefits are collectively referred to as the “Benefits”) would be subject to the excise tax (the “Excise Tax”) imposed under Section 4999 of the Internal Revenue Code of 1986, as amended (the “Code”), the Benefits shall be reduced (but not below zero) if and to the extent that a reduction in the Benefits would result in the Executive retaining a larger amount, on an after-tax basis (taking into account federal, state and local income taxes and the Excise Tax), than if the Executive received all of the Benefits (such reduced amount is referred to hereinafter as the “Limited Benefit Amount”). Unless the Executive shall have given prior written notice specifying a different order to the Company to effectuate the Limited Benefit Amount, any such notice consistent with the requirements of Section 409A of the Code to avoid the imputation of any tax, penalty or interest thereunder, the Company shall reduce or eliminate the Benefits by first reducing or eliminating those payments or benefits which are not payable in cash and then by reducing or eliminating cash payments, in each case in reverse order beginning with payments or benefits which are to be paid the farthest in time from the Determination (as hereinafter defined). Any notice given by the Executive pursuant to the preceding sentence shall take precedence over the provisions of any other plan, arrangement or agreement governing the Executive’s rights and entitlements to any benefits or compensation.

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(b) A determination as to whether the Benefits shall be reduced to the Limited Benefit Amount pursuant to this Agreement and the amount of such Limited Benefit Amount shall be made by the Company’s independent public accountants or another certified public accounting firm of national reputation designated by the Company (the “Accounting Firm”) at the Company’s expense. The Accounting Firm shall provide its determination (the “Determination”), together with detailed supporting calculations and documentation to the Company and the Executive within ten (10) business days of the date of termination of the Executive’s employment, if applicable, or such other time as requested by the Company or the Executive (provided the Executive reasonably believes that any of the Benefits may be subject to the Excise Tax), and if the Accounting Firm determines that no Excise Tax is payable by the Executive with respect to any Benefits, it shall furnish the Executive with an opinion reasonably acceptable to the Executive that no Excise Tax will be imposed with respect to any such Benefits. Unless the Executive provides written notice to the Company within ten (10) business days of the delivery of the Determination to the Executive that he disputes such Determination, the Determination shall be binding, final and conclusive upon the Company and the Executive.

6. Protective Covenants.

6.1 Confidential Information; Inventions.

(a) The Executive shall not disclose or use at any time, either during the Period of Employment or thereafter, any Confidential Information (as defined below) of which the Executive is or becomes aware, whether or not such information is developed by him, except to the extent that such disclosure or use is directly related to and required by the Executive’s performance in good faith of duties for the Company. The Executive will take all appropriate steps to safeguard Confidential Information in his possession and to protect it against disclosure, misuse, espionage, loss and theft. The Executive shall deliver to the Company at the termination of the Period of Employment, or at any time the Company may request, all memoranda, notes, plans, records, reports, computer tapes and software and other documents and data (and copies thereof) relating to the Confidential Information or the Work Product (as hereinafter defined) of the business of the Company or any of its Affiliates which the Executive may then possess or have under his control. Notwithstanding the foregoing, the Executive may truthfully respond to a lawful and valid subpoena or other legal process, but shall give the Company the earliest possible notice thereof, shall, as much in advance of the return date as possible, make available to the Company and its counsel the documents and other information sought, and shall assist the Company and such counsel in resisting or otherwise responding to such process.

(b) As used in this Agreement, the term “Confidential Information” means information that is not generally known to the public and that is used, developed or obtained by the Company in connection with its business, including, but not limited to, information, observations and data obtained by the Executive while employed by the Company or any predecessors thereof (including those obtained prior to the Effective Date) concerning (i) the business or affairs of the Company (or such predecessors), including business, marketing and mergers and acquisitions plans and strategies, (ii) products or services (including product road maps and strategies), (iii) fees, costs and pricing structures, (iv) designs, (v) analyses, (vi) drawings, photographs and reports, (vii) computer software, including operating systems, applications and program listings, (viii) flow charts, manuals and documentation, (ix) data bases, (x) accounting and business methods, (xi) inventions, devices, new developments, methods and processes, whether patentable or unpatentable and whether or not reduced to practice, (xii) suppliers, customers and clients, as well as supplier, customer or client lists, preferences and/or contracts and contract terms, (xiii) other copyrightable works, (xiv) all production methods, processes, technology and trade secrets, and (xv) all similar and related information in whatever form. Confidential Information will not include any information that has been published (other than a disclosure by the Executive in breach of this Agreement) in a form generally available to the public prior to the date the Executive proposes to disclose or use such information. Confidential Information will not be deemed to have been published merely because individual portions of the information have been separately published, but only if all material features comprising such information have been published in combination.

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(c) As used in this Agreement, the term “Work Product” means all inventions, innovations, improvements, technical information, systems, software developments, methods, designs, analyses, drawings, reports, service marks, trademarks, trade names, logos and all similar or related information (whether patentable or unpatentable, copyrightable, registerable as a trademark, reduced to writing, or otherwise) which relates to the Company’s or any of its Affiliates’ actual or anticipated business, research and development or existing or future products or services and which are conceived, developed or made by the Executive (whether or not during usual business hours, whether or not by the use of the facilities of the Company or any of its Affiliates, and whether or not alone or in conjunction with any other person) while employed by the Company (including those conceived, developed or made prior to the Effective Date) together with all patent applications, letters patent, trademark, trade name and service mark applications or registrations, copyrights and reissues thereof that may be granted for or upon any of the foregoing. All Work Product that the Executive may have discovered, invented or originated during his employment by the Company or any of its Affiliates prior to the Effective Date, that he may discover, invent or originate during the Period of Employment or at any time in the period of twelve (12) months after the Severance Date, shall be the exclusive property of the Company and its Affiliates, as applicable, and Executive hereby assigns all of Executive’s right, title and interest in and to such Work Product to the Company or its applicable Affiliate, including all intellectual property rights therein. Executive shall promptly disclose all Work Product to the Company, shall execute at the request of the Company any assignments or other documents the Company may deem necessary to protect or perfect its (or any of its Affiliates’, as applicable) rights therein, and shall assist the Company, at the Company’s expense, in obtaining, defending and enforcing the Company’s (or any of its Affiliates’, as applicable) rights therein. The Executive hereby appoints the Company as his attorney- in-fact to execute on his behalf any assignments or other documents deemed necessary by the Company to protect or perfect the Company, the Company’s (and any of its Affiliates’, as applicable) rights to any Work Product.

6.2 Restriction on Competition. The Executive agrees that if the Executive were to become employed by, or substantially involved in, the business of a competitor of the Company or any of its Affiliates during the twelve (12)/) month period following the Severance Date, it would be very difficult for the Executive not to rely on or use the Company’s and its Affiliates’ trade secrets and confidential information. Thus, to avoid the inevitable disclosure of the Company’s and its Affiliates’ trade secrets and confidential information, and to protect such trade secrets and confidential information and the Company’s and its Affiliates’ relationships and goodwill with customers, during the Period of Employment and for a period of twelve (12) months after the Severance Date, the Executive will not directly or indirectly through any other Person engage in, enter the employ of, render any services to, have any ownership interest in, nor participate in the financing, operation, management or control of, any Competing Business. For purposes of this Agreement, the phrase “directly or indirectly through any other Person engage in” shall include, without limitation, any direct or indirect ownership or profit participation interest in such enterprise, whether as an owner, stockholder, member, partner, joint venture or otherwise, and shall include any direct or indirect participation in such enterprise as an employee, consultant, director, officer, licensor of technology or otherwise. For purposes of this Agreement, “Competing Business” means a Person anywhere in the continental United States and elsewhere in the world, where the Company and its Affiliates engage in business, or reasonably anticipate engaging in business, on the Severance Date (the “Restricted Area”) that at any time during the Period of Employment has competed, or any and time during the twelve (12) month period following the Severance Date competes, with the Company or any of its Affiliates in any business related to telecommunications infrastructure. Nothing herein shall prohibit the Executive from being a passive owner of not more than 2% of the outstanding stock of any class of a corporation which is publicly traded, so long as the Executive has no active participation in the business of such corporation,

6.3 Non-Solicitation of Employees and Consultants. During the Period of Employment and for a period of twelve (12) months after the Severance Date, the Executive will not directly or indirectly through any other Person induce or attempt to induce any employee or independent contractor of the Company or any Affiliate of the Company to leave the employ or service, as applicable, of the Company or such Affiliate, or in any way interfere with the relationship between the Company or any such Affiliate, on the one hand, and any employee or independent contractor thereof, on the other hand.

6.4 Non-Interference with Customers. During the Period of Employment and for a period of twelve (12) months after the Severance Date, the Executive will not, directly or indirectly through any other Person, use any of the Company’s trade secrets to influence or attempt to influence customers, vendors, suppliers, licensors, lessors, joint ventures, associates, consultants, agents, or partners of the Company or any Affiliate of the Company to divert their business away from the Company or such Affiliate, and the Executive will not otherwise use the Company’s trade secrets to interfere with, disrupt or attempt to disrupt the business relationships, contractual or otherwise, between the Company or any Affiliate of the Company, on the one hand, and any of its or their customers, suppliers, vendors, lessors, licensors, joint ventures, associates, officers, employees, consultants, managers, partners, members or investors, on the other hand.

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6.5 Cooperation. Following the Executive’s last day of employment by the Company, the Executive shall reasonably cooperate with the Company and its Affiliates in connection with: (a) any internal or governmental investigation or administrative, regulatory, arbitral or judicial proceeding involving the Company and any Affiliates with respect to matters relating to the Executive’s employment with or service as a member of the Board or the board of directors of any Affiliate (collectively, “Litigation”); or (b) any audit of the financial statements of the Company or any Affiliate with respect to the period of time when the Executive was employed by the Company or any Affiliate (“Audit”). The Executive acknowledges that such cooperation may include, but shall not be limited to, the Executive making himself available to the Company or any Affiliate (or their respective attorneys or auditors) upon reasonable notice for: (i) interviews, factual investigations, and providing declarations or affidavits that provide truthful information in connection with any Litigation or Audit; (ii) appearing at the request of the Company or any Affiliate to give testimony without requiring service of a subpoena or other legal process; (iii) volunteering to the Company or any Affiliate pertinent information related to any Litigation or Audit; (iv) providing information and legal representations to the auditors of the Company or any Affiliate, in a form and within a time frame requested by the Board, with respect to the Company’s or any Affiliate’s opening balance sheet valuation of intangibles and financial statements for the period in which the Executive was employed by the Company or any Affiliate; and (v) turning over to the Company or any Affiliate any documents relevant to any Litigation or Audit that are or may come into the Executive’s possession. The Company shall reimburse the Executive for reasonable travel expenses incurred in connection with providing the services under this Section 6.5, including lodging and meals, upon the Executive’s submission of receipts. If, due to an actual or potential conflict of interest, it is necessary for the Executive to retain separate counsel in connection with providing the services under this Section 6.5, and such counsel is not otherwise supplied by and at the expense of the Company (pursuant to indemnification rights of the Executive or otherwise), the Company shall further reimburse the Executive for the reasonable fees and expenses of such separate counsel.

6.6 Understanding of Covenants. The Executive acknowledges that, in the course of his employment with the Company and/or its Affiliates and their predecessors, he has become familiar, or will become familiar, with the Company’s and its Affiliates’ and their predecessors’ trade secrets and with other confidential and proprietary information concerning the Company, its Affiliates and their respective predecessors and that his services have been and will be of special, unique and extraordinary value to the Company and its Affiliates. The Executive agrees that the foregoing covenants set forth in this Section 6 (together, the “Restrictive Covenants”) are reasonable and necessary to protect the Company’s and its Affiliates’ trade secrets and other confidential and proprietary information, good will, stable workforce, and customer relations.

Without limiting the generality of the Executive’s agreement in the preceding paragraph, the Executive (i) represents that he is familiar with and has carefully considered the Restrictive Covenants, (ii) represents that he is fully aware of his obligations hereunder, (iii) agrees to the reasonableness of the length of time, scope and geographic coverage, as applicable, of the Restrictive Covenants, (iv) agrees that the Company and its Affiliates currently conducts business throughout the Restricted Area, and (v) agrees that the Restrictive Covenants will continue in effect for the applicable periods set forth above in this Section 6 regardless of whether the Executive is then entitled to receive severance pay or benefits from the Company. The Executive understands that the Restrictive Covenants may limit his ability to earn a livelihood in a business similar to the business of the Company and any of its Affiliates, but he nevertheless believes that he has received and will receive sufficient consideration and other benefits as an employee of the Company and as otherwise provided hereunder or as described in the recitals hereto to clearly justify such restrictions which, in any event (given his education, skills and ability), the Executive does not believe would prevent him from otherwise earning a living. The Executive agrees that the Restrictive Covenants do not confer a benefit upon the Company disproportionate to the detriment of the Executive.

6.7 Enforcement. The Executive agrees that the Executive’s services are unique and that he has access to Confidential Information and Work Product. Accordingly, without limiting the generality of Section 17, the Executive agrees that a breach by the Executive of any of the covenants in this Section 6 would cause immediate and irreparable harm to the Company that would be difficult or impossible to measure, and that damages to the Company for any such injury would therefore be an inadequate remedy for any such breach. Therefore, the Executive agrees that in the event of any breach or threatened breach of any provision of this Section 6, the Company shall be entitled, in addition to and without limitation upon all other remedies the Company may have under this Agreement, at law or otherwise, to obtain specific performance, injunctive relief and/or other appropriate relief (without posting any bond or deposit) in order to enforce or prevent any violations of the provisions of this Section 6, or require the Executive to account for and pay over to the Company all compensation, profits, moneys, accruals, increments or other benefits derived from or received as a result of any transactions constituting a breach of this Section 6 if and when final judgment of a court of competent jurisdiction or arbitrator, as applicable, is so entered against the Executive. The Executive further agrees that the applicable period of time any Restrictive Covenant is in effect following the Severance Date, as determined pursuant to the foregoing provisions of this Section 6, such period of time shall be extended by the same amount of time that Executive is in breach of any Restrictive Covenant.

7. Withholding Taxes. Notwithstanding anything else herein to the contrary, the Company may withhold (or cause there to be withheld, as the case may be) from any amounts otherwise due or payable under or pursuant to this Agreement such federal, state and local income, employment, or other taxes as may be required to be withheld pursuant to any applicable law or regulation. Except for such withholding rights, the Executive is solely responsible for any and all tax liability that may arise with respect to the compensation provided under or pursuant to this Agreement.

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8. Successors and Assigns.

(a) This Agreement is personal to the Executive and without the prior written consent of the Company shall not be assignable by the Executive otherwise than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’s legal representatives.

(b) This Agreement shall inure to the benefit of and be binding upon the Company and its successors and assigns. Without limiting the generality of the preceding sentence, the Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. As used in this Agreement, “Company” shall mean the Company as hereinbefore defined and any successor or assignee, as applicable, which assumes and agrees to perform this Agreement by operation of law or otherwise.

9. Number and Gender; Examples. Where the context requires, the singular shall include the plural, the plural shall include the singular, and any gender shall include all other genders. Where specific language is used to clarify by example a general statement contained herein, such specific language shall not be deemed to modify, limit or restrict in any manner the construction of the general statement to which it relates.

10. Section Headings. The section headings of, and titles of paragraphs and subparagraphs contained in, this Agreement are for the purpose of convenience only, and they neither form a part of this Agreement nor are they to be used in the construction or interpretation thereof.

11. Governing Law. This Agreement will be governed by and construed in accordance with the laws of the state of Florida, without giving effect to any choice of law or conflicting provision or rule (whether of the state of Florida or any other jurisdiction) that would cause the laws of any jurisdiction other than the state of Florida to be applied. In furtherance of the foregoing, the internal law of the state of Florida will control the interpretation and construction of this Agreement, even if under such jurisdiction’s choice of law or conflict of law analysis, the substantive law of some other jurisdiction would ordinarily apply.

12. Severability. It is the desire and intent of the parties hereto that the provisions of this Agreement be enforced to the fullest extent permissible under the laws and public policies applied in each jurisdiction in which enforcement is sought. Accordingly, if any particular provision of this Agreement shall be adjudicated by a court of competent jurisdiction to be invalid, prohibited or unenforceable under any present or future law, and if the rights and obligations of any party under this Agreement will not be materially and adversely affected thereby, such provision, as to such jurisdiction, shall be ineffective, without invalidating the remaining provisions of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction, and to this end the provisions of this Agreement are declared to be severable; furthermore, in lieu of such invalid or unenforceable provision there will be added automatically as a part of this Agreement, a legal, valid and enforceable provision as similar in terms to such invalid or unenforceable provision as may be possible. Notwithstanding the foregoing, if such provision could be more narrowly drawn (as to geographic scope, period of duration or otherwise) so as not to be invalid, prohibited or unenforceable in such jurisdiction, it shall, as to such jurisdiction, be so narrowly drawn, without invalidating the remaining provisions of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction.

13. Entire Agreement. This Agreement embodies the entire agreement of the parties hereto respecting the matters within its scope. This Agreement supersedes all prior and contemporaneous agreements of the parties hereto that directly or indirectly bears upon the subject matter hereof (including, without limitation, the Prior Employment Agreement). Any prior negotiations, correspondence, agreements, proposals or understandings relating to the subject matter hereof shall be deemed to have been merged into this Agreement, and to the extent inconsistent herewith, such negotiations, correspondence, agreements, proposals, or understandings shall be deemed to be of no force or effect. There are no representations, warranties, or agreements, whether express or implied, or oral or written, with respect to the subject matter hereof, except as expressly set forth herein.

14. Modifications. This Agreement may not be amended, modified or changed (in whole or in part), except by a formal, definitive written agreement expressly referring to this Agreement, which agreement is executed by both of the parties hereto.

15. Waiver. Neither the failure nor any delay on the part of a party to exercise any right, remedy, power or privilege under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power or privilege preclude any other or further exercise of the same or of any right, remedy, power or privilege, nor shall any waiver of any right, remedy, power or privilege with respect to any occurrence be construed as a waiver of such right, remedy, power or privilege with respect to any other occurrence. No waiver shall be effective unless it is in writing and is signed by the party asserted to have granted such waiver.

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16. Arbitration. Except as provided in Sections 6.6 and 17, Executive and the Company agree that any controversy arising out of or relating to this Agreement, its enforcement or interpretation, or because of an alleged breach, default, or misrepresentation in connection with any of its provisions, or any other controversy arising out of Executive’s employment, including, but not limited to, any state or federal statutory claims, shall be submitted to arbitration in [Miami, Florida], before a sole arbitrator (the “Arbitrator”) selected from the American Arbitration Association, as the exclusive forum for the resolution of such dispute; provided, however, that provisional injunctive relief may, but need not, be sought by either party to this Agreement in a court of law while arbitration proceedings are pending, and any provisional injunctive relief granted by such court shall remain effective until the matter is finally determined by the Arbitrator. Final resolution of any dispute through arbitration may include any remedy or relief which the Arbitrator deems just and equitable, including any and all remedies provided by applicable state or federal statutes. At the conclusion of the arbitration, the Arbitrator shall issue a written decision that sets forth the essential findings and conclusions upon which the Arbitrator’s award or decision is based. Any award or relief granted by the Arbitrator hereunder shall be final and binding on the parties hereto and may be enforced by any court of competent jurisdiction. The parties acknowledge and agree that they are hereby waiving any rights to trial by jury in any action, proceeding or counterclaim brought by either of the parties against the other in connection with any matter whatsoever arising out of or in any way connected with this Agreement or Executive’s employment. The parties agree that the Company shall be responsible for payment of the forum costs of any arbitration hereunder, including the Arbitrator’s fee, but that each party shall bear its own attorney’s fees and other expenses.

17. Remedies. Each of the parties to this Agreement and any such person or entity granted rights hereunder whether or not such person or entity is a signatory hereto shall be entitled to enforce its rights under this Agreement specifically to recover damages and costs for any breach of any provision of this Agreement and to exercise all other rights existing in its favor. The parties hereto agree and acknowledge that money damages may not be an adequate remedy for any breach of the provisions of this Agreement and that each party may in its sole discretion apply to any court of law or equity of competent jurisdiction for provisional injunctive or equitable relief and/or other appropriate equitable relief (without posting any bond or deposit) in order to enforce or prevent any violations of the provisions of this Agreement. Each party shall be responsible for paying its own attorneys’ fees, costs and other expenses pertaining to any such legal proceeding and enforcement regardless of whether an award or finding or any judgment or verdict thereon is entered against either party.

18. Notices. Any notice provided for in this Agreement must be in writing and must be either personally delivered, transmitted via telecopier, mailed by first class mail (postage prepaid and return receipt requested) or sent by reputable overnight courier service (charges prepaid) to the recipient at the address below indicated or at such other address or to the attention of such other person as the recipient party has specified by prior written notice to the sending party. Notices will be deemed to have been given hereunder and received when delivered personally, when received if transmitted via telecopier, five days after deposit in the U.S. mail and one day after deposit with a reputable overnight courier service.

if to the Company:

Spectrum Global Solutions, Inc.

C/O: AW Solutions, Inc.

300 Crown Oak Centre Drive Longwood, Florida 32750

Attention: President/COO

with a copy to:

Pryor, Cashman

PRYOR CASHMAN LLP

7 Times Square, New York, NY 10036-6569

Attention: Ali Panjwani, Esq

if to the Executive, to the address most recently on file in the payroll records of the Company.

19. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original as against any party whose signature appears thereon, and all of which together shall constitute one and the same instrument. This Agreement shall become binding when one or more counterparts hereof, individually or taken together, shall bear the signatures of all of the parties reflected hereon as the signatories. Photographic copies of such signed counterparts may be used in lieu of the originals for any purpose.

20. Legal Counsel; Mutual Drafting. Each party recognizes that this is a legally binding contract and acknowledges and agrees that they have had the opportunity to consult with legal counsel of their choice. Each party has cooperated in the drafting, negotiation and preparation of this Agreement. Hence, in any construction to be made of this Agreement, the same shall not be construed against either party on the basis of that party being the drafter of such language. The Executive agrees and acknowledges that he has read and understands this Agreement, is entering into it freely and voluntarily, and has been advised to seek counsel prior to entering into this Agreement and has had ample opportunity to do so.

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21. Section 409A.

(a) It is intended that any amounts payable under this Agreement shall either be exempt from or comply with Section 409A of the Code (including the Treasury regulations and other published guidance relating thereto) (“Code Section 409A”) so as not to subject the Executive to payment of any additional tax, penalty or interest imposed under Code Section 409A. The provisions of this Agreement shall be construed and interpreted to avoid the imputation of any such additional tax, penalty or interest under Code Section 409A yet preserve (to the nearest extent reasonably possible) the intended benefit payable to the Executive.

(b) If the Executive is a “specified employee” within the meaning of Treasury Regulation Section 1.409A-1(i) as of the date of the Executive’s Separation from Service, the Executive shall not be entitled to any payment or benefit pursuant to Section 5.3(b) or (c) until the earlier of (i) the date which is six (6) months after his or her Separation from Service for any reason other than death, or (ii) the date of the Executive’s death. The provisions of this Section 21(b) shall only apply if, and to the extent, required to avoid the imputation of any tax, penalty or interest pursuant to Code Section 409A. Any amounts otherwise payable to the Executive upon or in the six (6) month period following the Executive’s Separation from Service that are not so paid by reason of this Section 21(b) shall be paid (without interest) as soon as practicable (and in all events within thirty (30) days) after the date that is six (6) months after the Executive’s Separation from Service (or, if earlier, as soon as practicable, and in all events within thirty (30) days, after the date of the Executive’s death).

(c) To the extent that any benefits pursuant to Section 5.3(b)(ii) or reimbursements pursuant to Section 4.2 are taxable to the Executive, any reimbursement payment due to the Executive pursuant to any such provision shall be paid to the Executive on or before the last day of the Executive’s taxable year following the taxable year in which the related expense was incurred. The benefits and reimbursements pursuant to such provisions are not subject to liquidation or exchange for another benefit and the amount of such benefits and reimbursements that the Executive receives in one taxable year shall not affect the amount of such benefits or reimbursements that the Executive receives in any other taxable year.

[The remainder of this page has intentionally been left blank.]

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IN WITNESS WHEREOF, the Company and the Executive have executed this Agreement as of the Effective Date.

“COMPANY”
Spectrum Global Solutions, Inc.,
a Nevada Corporation
By:
Name:	Roger Ponder
Title:	CEO
“EXECUTIVE”
Keith Hayter

14

EX-31.1

Exhibit 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

I, Roger Ponder, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Spectrum Global Solutions, Inc.:

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods present in this Quarterly Report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13-a-15(f) and 15d-15(f)) for the registrant and have:

a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this Quarterly Report based on such evaluation; and
d)	Disclosed in this report any change in the registrant’s internal control over financing reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involved management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: March 15, 2019	By:	/s/ Roger Ponder
		Roger Ponder
		Chief Executive Officer (Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

I, Roger Ponder, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Spectrum Global Solutions, Inc.:

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods present in this Quarterly Report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13-a-15(f) and 15d-15(f)) for the registrant and have:

a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this Quarterly Report based on such evaluation; and
d)	Disclosed in this report any change in the registrant’s internal control over financing reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involved management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 15, 2019	By:	/s/ Roger Ponder
		Roger Ponder
		Chief Financial Officer (Principal Financial and Accounting Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the accompanying Quarterly Report on Form 10-Q of Spectrum Global Solutions, Inc. for the quarter ended March 31, 2019, I, Roger Ponder, Chief Executive Officer of Spectrum Global Solutions, Inc., hereby certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, to the best of my knowledge and belief, that:

1. Such Quarterly Report on Form 10-Q for the quarter ended March 31, 2019, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in such Quarterly Report on Form 10-Q for the Quarter ended March 31, 2019, fairly presents, in all material respects, the financial condition and results of operations of Spectrum Global Solutions,, Inc.

Date: May 15, 2019	By:	/s/ Roger Ponder
		Roger Ponder
		Chief Executive Officer (Principal Executive Officer)

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the accompanying Quarterly Report on Form 10-Q of Spectrum Global Solutions Inc. for the quarter ended March 31, 2019, I, Roger Ponder, Chief Financial Officer of Spectrum Global Solutions, Inc., hereby certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, to the best of my knowledge and belief, that:

1. Such Quarterly Report on Form 10-Q for the quarter ended March 31, 2019, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in such Quarterly Report on Form 10-Q for the Quarter ended March 31, 2019, fairly presents, in all material respects, the financial condition and results of operations of Spectrum Global Solutions, Inc.

Date: May 15, 2019	By:	/s/ Roger Ponder
		Roger Ponder
		Chief Financial Officer (Principal Financial and Accounting Officer)

XML

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2019	May 14, 2019
Document and Entity Information [Abstract]
Entity Registrant Name	Spectrum Global Solutions, Inc.
Entity Central Index Key	0001413891
Trading Symbol	SGSI
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Document Type	10-Q
Document Period End Date	Mar. 31, 2019
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2019
Entity Filer Category	Non-accelerated Filer
Entity Emerging Growth Company	false
Entity Small Business	true
Entity Ex Transition Period	false
Entity Common Stock, Shares Outstanding		33,557,903

XML

Condensed Consolidated Balance Sheets - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Current assets
Cash	$ 966,790	$ 620,593
Accounts receivable (net of allowance for doubtful accounts of $514,302 and $502,868, respectively)	7,759,001	6,562,182
Contract assets	2,227,195	1,861,895
Prepaid expenses and deposits	262,775	22,682
Total current assets	11,215,761	9,067,352
Property and equipment (net of accumulated depreciation of $1,027,977 and $1,020,959, respectively)	106,779	61,257
Goodwill	2,505,615	1,834,856
Customer lists (net of accumulated amortization of $249,121 and $187,299, respectively)	2,588,427	850,249
Tradenames (net of accumulated amortization of $143,922 and $118,810, respectively)	1,361,683	1,086,795
Operating lease right-of use assets	232,325
Other assets	26,296	29,887
Total assets	18,036,886	12,930,396
Current liabilities
Accounts payable and accrued liabilities	7,162,898	5,472,108
Contract liabilities	449,950
Loans payable	6,134,673	3,637,078
Loans payable to related parties	313,858	313,858
Convertible debentures (net of discount of $1,360,735 and $1,770,073, respectively)	5,188,558	4,842,391
Derivative liability	2,874,674	3,166,886
Warrant liability	100,000	100,000
Operating lease liabilities	233,191
Total current liabilities	22,457,802	17,532,321
Stockholders' deficit
Common stock Authorized: 750,000,000 shares, par value $0.00001 Issued 14,826,590 (December 31, 2018- 12,907,869); Outstanding: 9,006,147 (December 31, 2018 – 7,087,426)	148	77
Additional paid-in capital	20,194,915	18,681,390
Treasury stock, at cost	(277,436)	(277,436)
Common stock subscribed	74,742	74,742
Accumulated deficit	(25,502,692)	(24,170,105)
Total stockholders' deficit	(5,510,323)	(5,691,332)
Total liabilities and stockholders' deficit	18,036,886	12,930,396
Series A Preferred Stock
Mezzanine equity
Preferred stock, value	604,877	604,877
Series B Preferred Stock
Mezzanine equity
Preferred stock, value	$ 484,530	$ 484,530

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Condensed Consolidated Balance Sheets (Parenthetical) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Accounts receivable (net of allowance for doubtful accounts)	$ 514,302	$ 502,868
Property and equipment (net of accumulated depreciation)	1,027,977	1,020,959
Customer lists (net of accumulated amortization)	249,121	187,299
Tradenames (net of accumulated amortization)	143,922	118,810
Convertible debentures, net of discount	$ 1,360,735	$ 1,770,073
Common stock, par value	$ 0.00001	$ 0.00001
Common stock, shares authorized	750,000,000	750,000,000
Common stock, shares issued	14,826,590	12,907,869
Common stock, shares outstanding	9,006,147	7,087,426
Series A Preferred Stock
Preferred stock, par value	$ 0.00001	$ 0.00001
Preferred stock, shares authorized	8,000,000	8,000,000
Preferred stock, shares issued	899,427	899,427
Preferred stock, shares outstanding	899,427	899,427
Series B Preferred Stock
Preferred stock, par value	$ 3,500	$ 3,500
Preferred stock, shares authorized	1,000	1,000
Preferred stock, shares issued	1,000	1,000
Preferred stock, shares outstanding	1,000	1,000

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Consolidated Statements of Operations (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Income Statement [Abstract]
Revenue	$ 11,335,732	$ 4,327,764
Operating expenses
Cost of revenues	8,824,165	3,784,520
Depreciation and amortization	93,952	47,833
General and administrative	1,044,708	661,298
Salaries and wages	1,358,208	577,604
Total operating expenses	11,321,033	5,071,255
Income (loss) from operations	14,699	(743,491)
Other income (expense)
Gain on settlement of debt	164,467	561,963
Gain on extinguishment of preferred stock liability		287,815
Amortization of discounts on convertible debentures and notes payable	(661,352)	(654,087)
Gain (loss) on change in fair value of derivatives	(369,391)	806,621
Interest expense	(471,412)	(179,325)
Total other income (expense)	(1,337,688)	822,987
Net income (loss) before income taxes	(1,322,987)	79,496
Provision for income taxes	(9,600)
Net income (loss)	(1,332,587)	79,496
Less: net loss attributable to the non-controlling interest		54,773
Net income (loss) attributable to Spectrum Global Solutions, Inc. common shareholders	$ (1,332,587)	$ 134,269
Net income (loss) per share attributable to Spectrum Global Solutions, Inc. common shareholders:
Basic	$ (0.11)	$ 0.06
Diluted	$ (0.11)	$ 0.03
Weighted average number of shares outstanding used in the calculation of net income (loss) attributable to Spectrum Global Solutions, Inc. per common share:
Basic	11,771,927	2,225,809
Diluted	11,771,927	8,429,006

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Consolidated Statements of Stockholder’s Deficit (Unaudited) - USD ($)	Common Stock	Additional paid-in capital	Common stock subscribed	Treasury Stock	Accumulated deficit	Non-controlling interest	Total
Balance at Dec. 31, 2017	$ 21	$ 15,909,612	$ 74,742		$ (22,322,725)	$ (88,650)	$ (6,427,000)
Balance, in shares at Dec. 31, 2017	2,115,136
Shares issued upon conversion of convertible debt	$ 2	526,367					526,369
Shares issued upon conversion of convertible debt, shares	188,274
Warrant issued to acquire non-controlling interest		(125,744)				(133,254)	(258,998)
Shares issued for services		312,561					312,561
Net loss for the period					134,269	(54,773)	134,269
Balance at Mar. 31, 2018	$ 23	16,622,796	74,742		(22,188,456)	(276,677)	(5,767,572)
Balance, in shares at Mar. 31, 2018	2,303,410
Balance at Dec. 31, 2018	$ 77	18,681,390	74,742	(277,436)	(24,170,105)		(5,691,332)
Balance, in shares at Dec. 31, 2018	7,708,684
Shares issued upon conversion of convertible debt	$ 42	1,042,211					1,042,253
Shares issued upon conversion of convertible debt, shares	4,248,675
Shares issued for services	$ 29	471,314					471,343
Shares issued for services, shares	2,869,231
Net loss for the period					(1,332,587)		(1,332,587)
Balance at Mar. 31, 2019	$ 148	$ 20,194,915	$ 74,742	$ (277,436)	$ (25,502,692)		$ (5,510,323)
Balance, in shares at Mar. 31, 2019	14,826,590

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Consolidated Statements of Cash Flows (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Operating activities
Net income (loss)	$ (1,332,587)	$ 79,496
Adjustments to reconcile net loss to net cash used in operating activities:
Loss (gain) on change in fair value of derivative liability	369,391	(806,621)
Amortization of discounts on convertible debentures and notes payable	661,352	654,087
Depreciation and amortization	93,952	47,833
Amortization of operating right of use assets	37,016
Foreign exchange loss (gain)		6,365
Shares issued for services	471,343
Original issue discount	20,000
Stock-based compensation on options and warrants		312,561
Derivative warrants issued for services		68,536
(Gain) loss on settlement of debt	(164,468)	(561,963)
Gain on extinguishment of preferred stock liability		(287,815)
Changes in operating assets and liabilities:
Accounts receivable	(1,131,653)	184,723
Contract assets	(365,300)
Prepaid expenses and deposits	390,717	20,774
Accounts payable and accrued liabilities	961,180	(380,379)
Other assets	3,591	5,813
Operating lease liabilities	(36,150)
Contract liabilities	(523,083)
Net cash used in operating activities	(544,700)	(656,590)
Investing activities
Net cash paid on acquisition	(941,593)
Cash received on acquisition		191,744
Purchase of equipment	(52,540)	(8,889)
Net cash (used in) investing activities	(994,133)	(182,855)
Financing activities
Repayment of loan payable	(6,147,609)	(386,125)
Proceeds from notes payable	8,367,190	616,306
Proceeds from issuance of convertible debentures		500,000
Repayment of convertible notes	(334,552)
Net cash provided by financing activities	1,885,029	730,181
Change in cash	346,197	256,446
Cash, beginning of period	620,593	28,893
Cash, end of period	966,790	285,339
Non-cash investing and financing activities:
Common stock issued for conversion of notes payable	1,042,254	92,703
Net assets acquired in TNS Acquisition	935,834
Convertible note issued in TNS acquisition	665,000
Net assets acquired in ADEX Acquisition		4,332,577
Warrant issued for non-controlling interest		133,256
Preferred stock issued to settle notes payable and accrued interest		439,560
Preferred stock issued to settle derivative liabilities		291,064
Preferred stock issued for prepaid expenses		13,820
Debt issuance cost		247,500
Original issue discounts	20,000	402,500
Third party payment of third party debt	150,000
Original debt discount against derivative liability	189,000	1,487,000
Supplemental disclosures:
Interest paid	206,467	4,622
Income taxes paid

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Organization and Going Concern

3 Months Ended

Mar. 31, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization and Going Concern

1. Organization and Going Concern

Spectrum Global Solutions, Inc., (the "Company") (f/k/a Mantra Venture Group Ltd.) was incorporated in the State of Nevada on January 22, 2007 to acquire and commercially exploit various new energy related technologies through licenses and purchases. On December 8, 2008, the Company continued its corporate jurisdiction out of the State of Nevada and into the province of British Columbia, Canada. On April 25, 2017, the Company entered into and closed on an Asset Purchase Agreement with InterCloud Systems, Inc. ("InterCloud"). Pursuant to the terms of the Asset Purchase Agreement, the Company purchased 80.1% of the assets associated with InterCloud's "AW Solutions" business. After the acquisition of AW Solutions, the Company provides professional, multi-service line, telecommunications infrastructure and outsource services to the wireless and wireline industry. On November 15, 2017, the Company changed its name to "Spectrum Global Solutions, Inc." On February 14, 2018, the Company entered into an agreement with InterCloud providing for the sale, transfer, conveyance and delivery to the Company of the remaining 19.9% of the assets associated with InterCloud's AWS business not already purchased by the Company.

On February 6, 2018, the Company entered into and closed on a Stock Purchase Agreement with InterCloud Systems, Inc. ("InterCloud"). Pursuant to the terms of the Stock Purchase Agreement, the Company purchased all of the issued and outstanding capital stock and membership interests of ADEX Corp. ("ADEX"). The Company closed and completed the acquisition on February 27, 2018. After the acquisition of ADEX, the Company provides professional, multi-service line, telecommunications infrastructure, outsource services and staffing solutions to the wireless and wireline industry. On May 18, 2018, the Company transferred all of its ownership interests in and to its subsidiaries Carbon Commodity Corporation, Mantra China Limited, Mantra Media Corp., Mantra NextGen Power Inc., Mantra Wind Inc., Climate ESCO Ltd. and Mantra Energy Alternatives Ltd. to an entity controlled by the Company's former Chief Executive Officer, Larry Kristof. The new owner of the aforementioned entities assumed all liabilities and obligations with respect to such entities. On January 4, 2019, the Company closed a Stock Purchase Agreement InterCloud. Pursuant to the terms of the Purchase Agreement, InterCloud agreed to sell, and the Company agreed to purchase, all of the issued and outstanding capital stock of TNS, Inc., an Illinois corporation ("TNS").

These consolidated financial statements have been prepared on a going concern basis, which implies the Company will continue to realize its assets and discharge its liabilities in the normal course of business. The recently acquired AW Solutions and ADEX business has also incurred losses and experienced negative cash flows from operations during its most recent fiscal years. The continuation of the Company as a going concern is dependent upon the continued financial support from its shareholders, the ability of management to raise additional equity capital through private and public offerings of its common stock, and the attainment of profitable operations. As of March 31, 2019, the Company has an accumulated deficit of $25,502,692, and a working capital deficit of $11,242,041. These factors raise substantial doubt regarding the Company's ability to continue as a going concern for a period of one year from the issuance of these financial statements. These consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

Management requires additional funds over the next twelve months to fully implement its business plan. Management is currently seeking additional financing through the sale of equity and from borrowings from private lenders to cover its operating expenditures. There can be no certainty that these sources will provide the additional funds required for the next twelve months. 

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Significant Accounting Policies

3 Months Ended

Mar. 31, 2019

Accounting Policies [Abstract]

Significant Accounting Policies

2. Significant Accounting Policies

a) Condensed financial statements

The accompanying unaudited interim consolidated financial statements of the Company should be read in conjunction with the consolidated financial statements and accompanying notes filed with the U.S. Securities and Exchange Commission in the Company’s Form 10-K for the year ended December 31, 2018. In the opinion of management, the accompanying financial statements reflect all adjustments of a recurring nature considered necessary to present fairly the Company’s financial position and the results of its operations and its cash flows for the periods shown.

The preparation of financial statements in accordance with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported. Actual results could differ materially from those estimates. The results of operations and cash flows for the periods shown are not necessarily indicative of the results to be expected for the full year.

b) Basis of Presentation/Principles of Consolidation

These consolidated financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States. These consolidated financial statements include the accounts of the Company and its subsidiaries, AW Solutions, Inc. (from the date of acquisition, April 25, 2017), Tropical Communications, Inc. (from the date of acquisition, April 25, 2017), AW Solutions Puerto Rico LLC. (from the date of acquisition, April 25, 2017), ADEX Corp., ADEX Puerto Rico, LLC and ADEXCOMM (from the date of acquisition, February 27, 2018), TNS, Inc. (from the date of acquisition, January 4, 2019). All the subsidiaries are wholly-owned. During the year ended December 31, 2018, the Company disposed of the following subsidiaries; Carbon Commodity Corporation, Climate ESCO Ltd., Mantra Energy Alternatives Ltd., Mantra China Inc., Mantra China Limited, Mantra Media Corp., Mantra NextGen Power Inc., and Mantra Wind Inc. All inter-company balances and transactions have been eliminated.

c) Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to allowance for doubtful accounts, the estimated useful lives and recoverability of long-lived assets, equity component of convertible debt, stock-based compensation, and deferred income tax asset valuation allowances. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected. 

d) Cash and Cash Equivalents

The Company considers all highly liquid instruments with maturity of three months or less at the time of issuance to be cash equivalents.

e) Accounts Receivable

Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The Company records unbilled receivables for services performed but not billed. Management reviews a customer’s credit history before extending credit. The Company maintains an allowance for doubtful accounts for estimated losses. Estimates of uncollectible amounts are reviewed each period, and changes are recorded in the period in which they become known. Management analyzes the collectability of accounts receivable each period. This review considers the aging of account balances, historical bad debt experience, and changes in customer creditworthiness, current economic trends, customer payment activity and other relevant factors. Should any of these factors change, the estimate made by management may also change. The allowance for doubtful accounts at March 31, 2019 and December 31, 2018 was $514,032 and $502,868, respectively.

f) Property and Equipment

Property and equipment are stated at cost. The Company depreciates the cost of property and equipment over their estimated useful lives at the following annual rates:

Automotive	3-5 years straight-line basis
Computer equipment and software	3-7 years straight-line basis
Leasehold improvements	5 years straight-line basis
Office equipment and furniture	5 years straight-line basis
Research equipment	5 years straight-line basis

g) Goodwill

Goodwill was generated through the acquisition of AW Solutions, ADEX and TNS as the total consideration paid exceeded the fair value of the net assets acquired.

The Company tests its goodwill for impairment at least annually on December 31^st and whenever events or circumstances change that indicate impairment may have occurred. A significant amount of judgment is involved in determining if an indicator of impairment has occurred. Such indicators may include, among others: a significant decline in the Company’s expected future cash flows; a significant adverse change in legal factors or in the business climate; unanticipated competition; and slower growth rates. Any adverse change in these factors could have a significant impact on the recoverability of goodwill and the Company’s consolidated financial results.

The Company tests goodwill by estimating fair value using a Discounted Cash Flow (“DCF”) model. The key assumptions used in the DCF model to determine the highest and best use of estimated future cash flows include revenue growth rates and profit margins based on internal forecasts, terminal value and an estimate of a market participant’s weighted-average cost of capital used to discount future cash flows to their present value. There were no impairment charges during the three months ended March 31, 2019.

h) Intangible Assets

At March 31, 2019 and December 31, 2018, definite-lived intangible assets primarily consist of non-compete agreements, tradenames and customer relationships which are being amortized over their estimated useful lives ranging from 3-20 years.

The Company periodically evaluates the reasonableness of the useful lives of these assets. Once these assets are fully amortized, they are removed from the accounts. These assets are reviewed for impairment or obsolescence when events or changes in circumstances indicate that the carrying amount may not be recoverable. If impaired, intangible assets are written down to fair value based on discounted cash flows or other valuation techniques. The Company has no intangibles with indefinite lives.

For long-lived assets, impairment losses are only recorded if the asset’s carrying amount is not recoverable through its undiscounted, probability-weighted future cash flows. The Company measures the impairment loss based on the difference between the carrying amount and the estimated fair value. When an impairment exists, the related assets are written down to fair value.

i) Long-lived Assets

In accordance with ASC 360, “Property, Plant and Equipment”, the Company tests long-lived assets or asset groups for recoverability when events or changes in circumstances indicate that their carrying amount may not be recoverable. Circumstances which could trigger a review include, but are not limited to: significant decreases in the market price of the asset; significant adverse changes in the business climate or legal factors; accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of the asset; current period cash flow or operating losses combined with a history of losses or a forecast of continuing losses associated with the use of the asset; and current expectation that the asset will more likely than not be sold or disposed significantly before the end of its estimated useful life. Recoverability is assessed based on the carrying amount of the asset and its fair value, which is generally determined based on the sum of the undiscounted cash flows expected to result from the use and the eventual disposal of the asset, as well as specific appraisal in certain instances. An impairment loss is recognized when the carrying amount is not recoverable and exceeds fair value. There were no impairment charges recorded during the three months ended March 31, 2019.

j) Foreign Currency Translation

Transactions in foreign currencies are translated into the currency of measurement at the exchange rates in effect on the transaction date. Monetary balance sheet items expressed in foreign currencies are translated into U.S. dollars at the exchange rates in effect at the balance sheet date. The resulting exchange gains and losses are recognized in income.

The Company’s integrated foreign subsidiaries are financially or operationally dependent on the Company. The Company uses the temporal method to translate the accounts of its integrated operations into U.S. dollars. Monetary assets and liabilities are translated at the exchange rates in effect at the balance sheet date. Non-monetary assets and liabilities are translated at historical rates. Revenues and expenses are translated at average rates for the period, except for amortization, which is translated on the same basis as the related asset. The resulting exchange gains or losses are recognized in income.

k) Income Taxes

The Company accounts for income taxes using the asset and liability method in accordance with ASC 740, “Accounting for Income Taxes”. The asset and liability method provides that deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities, and for operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized.

The Company conducts business, and files federal and state income, franchise or net worth, tax returns in Canada, the United States, in various states within the United States and the Commonwealth of Puerto Rico. The Company determines it’s filing obligations in a jurisdiction in accordance with existing statutory and case law. The Company may be subject to a reassessment of federal and provincial income taxes by Canadian tax authorities for a period of three years from the date of the original notice of assessment in respect of any particular taxation year. For Canadian and U.S. income tax returns, the open taxation years range from 2010 to 2018. In certain circumstances, the U.S. federal statute of limitations can reach beyond the standard three year period. U.S. state statutes of limitations for income tax assessment vary from state to state. Tax authorities of Canada and U.S. have not audited any of the Company’s, or its subsidiaries’, income tax returns for the open taxation years noted above.

Significant management judgment is required in determining the provision for income taxes, and in particular, any valuation allowance recorded against the Company’s deferred tax assets. Deferred tax assets are regularly reviewed for recoverability. The Company currently has significant deferred tax assets resulting from net operating loss carryforwards and deductible temporary differences, which should reduce taxable income in future periods. The realization of these assets is dependent on generating future taxable income.

The Company follows the guidance set forth within ASC Topic 740, “Income Taxes” (“ASC Topic 740”) which prescribes a two-step process for the financial statement recognition and measurement of income tax positions taken or expected to be taken in an income tax return. The first step evaluates an income tax position in order to determine whether it is more likely than not that the position will be sustained upon examination, based on the technical merits of the position. The second step measures the benefit to be recognized in the financial statements for those income tax positions that meet the more likely than not recognition threshold. ASC Topic 740 also provides guidance on de-recognition, classification, recognition and classification of interest and penalties, accounting in interim periods, disclosure and transition. Penalties and interest, if incurred, would be recorded as a component of current income tax expense.

The Company received a tax notice from the Puerto Rican government requesting payment of taxes related to 2014 in the amount of $156,711 plus penalties and interest of $111,200 for a total obligation due of $267,911. This tax assessment is included in accrued expenses at March 31, 2019.

l) Revenue Recognition

Revenue from Contracts with Customers

Adoption of New Accounting Guidance on Revenue Recognition

On May 28, 2014, FASB issues Topic 606. As of January 1, 2018, the Company adopted Topic 606 using the modified retrospective approach applied to any contracts that were not completed as of January 1, 2018. Results for reporting periods beginning after January 1, 2018 are presented under the new guidance, while prior periods continue to be reported in accordance with previous accounting guidance. The Company determined that no cumulative effect adjustment to accumulated deficit was necessary upon adoption as there were no significant revenue recognition differences identified between the new and previous accounting guidance.

The Company recognizes revenue based on the five criteria for revenue recognition established under Topic 606: 1) identify the contract, 2) identify separate performance obligations, 3) determine the transaction price, 4) allocate the transaction price among the performance obligations, and 5) recognize revenue as the performance obligations are satisfied.

Contract Types

The Company’s contracts fall under three main types: 1) unit-price, 2) fixed-price, and 3) time-and-materials. Unit-price contracts relate to services being performed and paid on a unit basis, such as per mile of construction completed. Fixed-price contracts are based on purchase order line items that are billed on individual invoices as the project progresses and milestones are reached. Time-and-materials contracts include employees working permanently at customer locations and materials costs incurred by those employees.

A significant portion of the Company’s revenues come from customers with whom the Company has a master service agreement (“MSA”). These MSA’s generally contain customer specific service requirements.

Performance Obligations

A performance obligation is a promise in a contract to transfer a distinct good or service to the customer, and is the unit of account in the new revenue standard. The contract transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. For the Company’s different revenue service types the performance obligation is satisfied at different times. For professional services revenue, the performance obligation is met when the work is performed. In certain cases this may be each day, or each week depending on the customer. For construction services, the performance obligation is met when the work is completed and the customer has approved the work. Contract assets include unbilled amounts for services performed but not yet billed. These amounts are included in accounts receivable on the consolidated balance sheets. Contract liabilities include unbilled costs and are included in accrued expenses on the consolidated balance sheets.

Revenue Service Types

The following is a description of the Company’s revenue service types, which include professional services and construction:

● Professional services are services provided to the clients where the company delivers distinct contractual deliverables and/or services. Deliverables may include but are not be limited to: engineering drawings, designs, reports and specification. Services may include, but are not be limited to: consulting or professional staffing to support our client’s objectives. Consulting or professional staffing services may be provided remotely or on client premises and under their direction and supervision.

● Construction Services are services provided to the client where the Company may self-perform or subcontract services that require the physical construction of infrastructure or installation of equipment and materials.

Disaggregation of Revenues

The Company disaggregates its revenue from contracts with customers by service type, contract type, contract duration, and timing of transfer of goods or services. See the below tables:

Revenue by service type	Three Months Ended March 31, 2019 $		Three Months Ended March 31, 2018 $
Professional services		5,935,226		3,366,569
Construction		5,400,506		961,195
Total		11,335,732		4,327,764

Revenue by contract duration	Three Months Ended March 31, 2019 $		Three Months Ended March 31, 2018 $
Short-term		65,430		43,278
Long-term		11,270,302		4,284,486
Total		11,335,732		4,327,764

Revenue by contract type	Three Months Ended March 31, 2019 $		Three Months Ended March 31, 2018 $
Unit-price		3,238,658		710,362
Fixed-price		2,161,848		250,833
Time-and-materials		5,935,226		3,366,569
Total		11,335,732		4,327,764

The Company also disaggregates its revenue by geographic location and operating segment (See Note 13).

Accounts Receivable

Accounts receivable include amounts from work completed in which the Company has billed. The amounts due are stated at their net estimated realizable value. The Company maintains an allowance for doubtful accounts to provide for the estimated amount of receivables that will not be collected. The allowance is based upon an assessment of customer creditworthiness, historical payment experience, the age of outstanding receivables and collateral to the extent applicable.

Contract Assets and Liabilities

Contract assets include unbilled amounts for services performed but not yet billed. These amounts are included in contract assets on the consolidated balance sheets. The Company records unbilled receivables for services performed but not billed. At March 31, 2019 and December 31, 2018, unbilled receivables totaled $2,227,195 and $1,861,895, respectively.

Contract liabilities include unbilled costs and are included in accrued expenses on the consolidated balance sheets.

m) Cost of Revenues

Cost of revenues includes all direct costs of providing services under our contracts, including costs for direct labor provided by employees, services by independent subcontractors, operation of capital equipment (excluding depreciation and amortization), direct materials, insurance claims and other direct costs.

n) Research and Development Costs

Research and development costs are expensed as incurred.

o) Stock-based Compensation

The Company records stock-based compensation in accordance with ASC 718, “Compensation – Stock Compensation”, using the fair value method. All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable.

The Company applies ASC 505-50, “Equity-Based Payments to Non-Employees” with respect to options and warrants issued to non-employees which requires the use of option valuation models to measure the fair value of the options and warrants at the measurement date.

The Company uses the Black-Scholes option pricing model to calculate the fair value of stock-based awards. This model is affected by the Company’s stock price as well as assumptions regarding a number of subjective variables. These subjective variables include, but are not limited to, the Company’s expected stock price volatility over the term of the awards, and actual and projected employee stock option exercise behaviors. The value of the portion of the award that is ultimately expected to vest is recognized as an expense in the consolidated statement of operations over the requisite service period.

p) Loss Per Share

The Company computes earnings (loss) per share in accordance with ASC 260, “Earnings per Share” which requires presentation of both basic and diluted earnings (loss) per share (“EPS”) on the face of the income statement. Basic EPS is computed by dividing the loss available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive. As of March 31, 2019, the Company had 29,135,606 (March 31, 2018 – 6,177,776) common stock equivalents outstanding.

q) Comprehensive Loss

ASC 220, “Comprehensive Income,” establishes standards for the reporting and display of comprehensive loss and its components in the financial statements. As at December 31, 2018 and 2017 the Company has no items that represent a comprehensive loss and, therefore, has not included a schedule of comprehensive loss in the consolidated financial statements.

r) Leases

The Company adopted FASB Accounting Standards Codification, Topic 842, Leases ("ASC 842") electing the practical expedient that allows the Company not to restate its comparative periods prior to the adoption of the standard on January 1, 2019. As such, the disclosures required under ASC 842 are not presented for periods before the date of adoption. For the comparative periods prior to adoption, the Company presented the disclosures which were required under ASC 840.

The new leasing standard requires recognition of leases on the consolidated balance sheets as right-of-use ("ROU") assets and lease liabilities. ROU assets represent the Company’s right to use underlying assets for the lease terms and lease liabilities represent the Company’s obligation to make lease payments arising from the leases. Operating lease ROU assets and operating lease liabilities are recognized based on the present value and future minimum lease payments over the lease term at commencement date. As the Company’s leases do not provide an implicit rate, the Company uses its estimated incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.

The Company recognized lease liabilities, with corresponding ROU assets, based on the present value of unpaid lease payments for existing operating leases longer than twelve months as of January 1, 2019. The ROU assets were adjusted per ASC 842 transition guidance for existing lease-related balances of accrued and prepaid rent, unamortized lease incentives provided by lessors, and restructuring liabilities, Operating lease cost is recognized as a single lease cost on a straight-line basis over the lease term and is recorded in selling, general and administrative expenses. Variable lease payments for common area maintenance, property taxes and other operating expenses are recognized as expense in the period when the changes in facts and circumstances on which the variable lease payments are based occur.

s) Recent Accounting Pronouncements

On January 1, 2018, we adopted the new accounting standard ASC 606, Revenue from Contracts with Customers, and all of the related amendments (“new revenue standard”) as discussed in Revenue Recognition accounting policy description.

In February 2016, the FASB issued ASU 2016-02, Leases (“ASU 2016-02”), which, among other things, requires an entity to recognize a right-of-use asset and a lease liability on the balance sheet for substantially all leases, including operating leases. Expanded disclosures with additional qualitative and quantitative information are also required. ASU 2016-02 and its amendments are effective for interim and annual reporting periods beginning after December 15, 2018 and early adoption was permitted.

The Company adopted ASU 2016-02 and its amendments and applied the transition provisions as of January 1, 2019, which included recognizing a cumulative-effect adjustment through opening retained earnings as of that date. Prior year amounts were not recast under this transition approach and, therefore, prior year amounts are excluded from the leased properties footnote. The Company elected the package of practical expedients permitted under the transition guidance, which allowed the Company to carryforward its historical assessments of: (1) whether contracts are or contain leases, (2) lease classification and (3) initial direct costs. In addition, the Company did not elect the hindsight practical expedient to determine the reasonably certain lease term for existing leases. The Company elected a policy of not recording leases on its condensed consolidated balance sheets when the leases have a term of 12 months or less and the Company is not reasonably certain to elect an option to purchase the leased asset. The Company recognizes payments on these leases within selling, administrative and other expenses on a straight-line basis over the lease term. The standard did not materially impact consolidated net income or liquidity.

The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or result of operations

t) Concentrations of Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and accounts receivables. The Company maintains its cash balances with high-credit-quality financial institutions. Deposits held with banks may exceed the amount of insurance provided on such deposits. These deposits may be withdrawn upon demand and therefore bear minimal risk.

The Company provides credit to customers on an uncollateralized basis after evaluating client creditworthiness. For the three months ended March 31, 2019, four customers accounted for 30%, 18%, 10% and 10%, respectively, of consolidated revenues for the period. In addition, amounts due from these customers represented 30%, 20%, 7% and 5%, respectively, of trade accounts receivable as of March 31, 2019. For the three months ended March 31, 2018, two customers accounted for 22% and 18%, respectively, of consolidated revenues for the period.

The Company’s customers are primarily located within the domestic United States of America and Puerto Rico. Revenues generated within the domestic United States of America accounted for approximately 97% of consolidated revenues for the three month period ended March 31, 2019 (89% - 2018). Revenues generated from customers in Puerto Rico accounted for approximately 3% of consolidated revenues for the three month period ended March 31, 2019 (11% - 2018).

u) Fair Value Measurements

The Company measures and discloses the estimated fair value of financial assets and liabilities using the fair value hierarchy prescribed by US generally accepted accounting principles. The fair value hierarchy has three levels, which are based on reliable available inputs of observable data. The hierarchy requires the use of observable market data when available. The three-level hierarchy is defined as follows:

Level 1 – quoted prices for identical instruments in active markets.

Level 2 – quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model derived valuations in which significant inputs and significant value drivers are observable in active markets; and.

Level 3 – fair value measurements derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

Financial instruments consist principally of cash and cash equivalents, accounts receivable, restricted cash, accounts payable, loans payable and convertible debentures. Derivative liabilities are determined based on “Level 3” inputs, which are significant and unobservable and have the lowest priority. There were no transfers into or out of “Level 3” during the three months ended March 31, 2019 and 2018. The recorded values of all other financial instruments approximate their current fair values because of their nature and respective relatively short maturity dates or durations.

Our financial assets and liabilities carried at fair value measured on a recurring basis as of December 31, 2018 and December 31, 2017, consisted of the following:

	Total fair value at March 31, 2019 $		Quoted prices in active markets (Level 1) $		Significant other observable inputs (Level 2) $		Significant unobservable inputs (Level 3) $
Description:
Derivative liability (1)		2,874,674		–		–		2,874,674

	Total fair value at December 31, 2018 $		Quoted prices in active markets (Level 1) $		Significant other observable inputs (Level 2) $		Significant unobservable inputs (Level 3) $
Description:
Derivative liability (1)		3,166,886		–		–		3,166,886

(1) The Company has estimated the fair value of these derivatives using the Monte-Carlo model and/or a Binomial Model.

Fair value estimates are made at a specific point in time, based on relevant market information and information about the financial statement. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimates. See Note 9 for additional information.

v) Derivative Liabilities

The Company accounts for derivative instruments in accordance with ASC Topic 815, “Derivatives and Hedging” and all derivative instruments are reflected as either assets or liabilities at fair value in the balance sheet. The Company uses estimates of fair value to value its derivative instruments. Fair value is defined as the price to sell an asset or transfer a liability in an orderly transaction between willing and able market participants. In general, the Company’s policy in estimating fair values is to first look at observable market prices for identical assets and liabilities in active markets, where available. When these are not available, other inputs are used to model fair value such as prices of similar instruments, yield curves, volatilities, prepayment speeds, default rates and credit spreads, relying first on observable data from active markets. Depending on the availability of observable inputs and prices, different valuation models could produce materially different fair value estimates. The values presented may not represent future fair values and may not be realizable. The Company categorizes its fair value estimates in accordance with ASC 820 based on the hierarchical framework associated with the three levels of price transparency utilized in measuring financial instruments at fair value as discussed above. As of March 31, 2019, and December 31, 2018, the Company had a $2,784,674 and $3,166,886 derivative liability, respectively.

w) Sequencing Policy

Under ASC 815-40-35, the Company has adopted a sequencing policy whereby, in the event that reclassification of contracts from equity to assets or liabilities is necessary pursuant to ASC 815 due to the Company’s inability to demonstrate it has sufficient authorized shares as a result of certain securities with a potentially indeterminable number of shares, shares will be allocated on the basis of the earliest issuance date of potentially dilutive instruments, with the earliest grants receiving the first allocation of shares. Pursuant to ASC 815, issuance of securities to the Company’s employees or directors are not subject to the sequencing policy.

x) Reclassifications

Certain balances in previously issued consolidated financial statements have been reclassified to be consistent with the current period presentation. The reclassification had no impact on total financial position, net income, or stockholders’ equity.

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Acquisition of TNS, Inc.

3 Months Ended

Mar. 31, 2019

Business Combinations [Abstract]

Acquisition of TNS, Inc.

3. Acquisition of TNS, Inc.

On January 4, 2019, the Company entered into a Stock Purchase Agreement (the "Purchase Agreement") with InterCloud Systems, Inc., a Delaware corporation ("InterCloud"). Pursuant to the terms of the Purchase Agreement, InterCloud agreed to sell, and the Company agreed to purchase, all of the issued and outstanding capital stock of TNS, Inc., an Illinois corporation ("TNS"). The Company closed and completed the acquisition on January 4, 2019.

The purchase price paid by the Company for the includes $980,000 in cash, paid at closing, and the issuance to InterCloud of a convertible promissory note in the aggregate principal amount of $620,000 (the "Note").

The Company has performed a valuation analysis of the fair market value of TNS' assets and liabilities. The provisional fair value of the purchase consideration issued to the sellers of TNS was allocated to the net tangible assets acquired. We accounted for the acquisition of TNS as the purchase of a business under GAAP under the acquisition method of accounting, the assets and liabilities acquired were recorded as of the acquisition date, at their respective fair values and consolidated with those of our company. The excess of the aggregate fair value of the net tangible assets has been allocated to an intangible asset, value of customer accounts and the remainder to goodwill. The purchase price allocation was based, in part, on management's knowledge of TNS' business and is preliminary. Once we complete our analysis to finalize the purchase price allocation, which includes finalizing the valuation report from a third-party appraiser and a review of potential intangible assets, it is reasonably possible that, there could be significant changes to the preliminary values below.

The following table summarizes the allocation of the preliminary purchase price as of the acquisition date:

Provisional Purchase Consideration
$620,000 Convertible Note	$	665,000
Cash		980,000
Total Purchase Price	$	1,645,000
Preliminary Allocation of Purchase Price
Cash	$	38,407
Accounts receivable, net		65,166
Prepaid expenses		630,810
Customer lists *		1,800,000
Tradenames *		300,000
Goodwill *		670,759
Accounts payable		(275,331	)
Accrued expenses		(611,778	)
Contract liabilities		(973,033	)
Net assets acquired	$	1,645,000

* The Company is reviewing for potential identifiable intangible assets, which may potentially change the value allocated to intangible assets.

The following table summarizes our consolidated results of operations for the year ended December 31, 2018, as well as unaudited pro forma consolidated results of operations as though the acquisition had occurred on January 1, 2018:

	March 31, 2019 $						March 31, 2018 $
	As Reported			Pro Forma			As Reported		Pro Forma
Net Sales		11,335,732			11,335,732			4,327,764		8,259,398
Net Loss		(1,332,587	)		(1,340,141	)		134,269		1,243,947
Earnings per common share:
Basic		(0.11	)		(0.11	)		0.06		0.56
Diluted		(0.11	)		(0.11	)		0.03		0.16

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Property and Equipment

3 Months Ended

Mar. 31, 2019

Property, Plant and Equipment [Abstract]

Property and Equipment

4. Property and Equipment

	March 31, 2019 $			December 31, 2018 $
Computers and office equipment		331,987			329,937
Equipment		382,140			382,140
Research equipment		143,129			143,129
Software		227,563			177,073
Vehicles		94,356			94,356
Vehicles under capital lease		–			–
Total		1,179,175			1,126,635
Less: impairment		(44,419	)		(44,419	)
Less: accumulated depreciation		(1,027,977	)		(1,020,959	)
Equipment, Net		106,779			61,257

During the three months ended March 31, 2019, the Company recorded $7,018 (2018 - $4,395) of depreciation expense.

XML

Intangible Assets

3 Months Ended

Mar. 31, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets

5. Intangible Assets

	Cost $		Accumulated amortization $		Impairment $		March 31, 2019 Net carrying value $		December 31, 2018 Net carrying value $
Customer relationship and lists		2,837,548		249,121		–		2,588,427		850,249
Trade names		1,505,605		143,922		–		1,361,683		1,086,795
		4,343,153		393,043		–		3,950,110		1,937,044

During the three months ended March 31, 2019, the Company recorded $86,934 (March 31, 2018 - $43,438) of amortization.

Estimated Future Amortization Expense:

	$
For year ending December 31, 2019		260,453
For year ending December 31, 2020		347,387
For year ending December 31, 2021		347,387
For year ending December 31, 2022		347,387
For year ending December 31, 2023 to December 31, 2027		2,647,496
Total		3,950,110

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Related Party Transactions

3 Months Ended

Mar. 31, 2019

Related Party Transactions [Abstract]

Related Party Transactions

6. Related Party Transactions

a) As at March 31, 2019, the Company owes $50,577 (December 31, 2018 - $51,889) to InterCloud, which is non-interest bearing, unsecured, and due on demand and included in accounts payable and accrued liabilities.

b) On November 30, 2017, the Company received $18,858 pursuant to a promissory note issued to the Chief Executive Officer of the Company. The note issued was unsecured, due on November 30, 2018 and bears interest at a rate of 8% per annum. On November 30, 2018, the lender agreed to extend the maturity of the loan to November 30, 2019.  The Company accounted for the modification in accordance with ASC 470-50 “Modifications and Extinguishments”. In accordance with ASC 470-50, the Company accounted for the extension as a modification and no gain or loss was recognized.

c) On November 30, 2017, the Company received $130,000 pursuant to a promissory note issued to the President of the Company. The note issued is unsecured, due on November 30, 2018 and bears interest at a rate of 8% per annum. On November 30, 2018, the lender agreed to extend the maturity of the loan to November 30, 2019. The Company accounted for the modification in accordance with ASC 470-50 “Modifications and Extinguishments”. In accordance with ASC 470-50, the Company accounted for the extension as a modification and no gain or loss was recognized.

d) On April 13, 2018, the Company received $85,000 pursuant to a promissory note issued to the President of the Company. The note issued is unsecured, due on April 13, 2019 and bears interest at a rate of 8% per annum. At December 31, 2018, the amount of $85,000 was owed. On April 20, 2019, the note was amended with to a maturity date of April 20, 2020 and an interest rate of 10%.

e) On April 23, 2018, each of Roger Ponder, the Company’s Chief Executive Officer, and Keith Hayter, the Company’s President, exchanged certain shares of common stock of the Company held by each of them for shares of the newly designated Series B Preferred Stock. Mr. Ponder exchanged 542,500 shares of common stock for an aggregate of 500 shares of Series B Preferred Stock, and Mr. Hayter exchanged 542,500 shares of common stock for an aggregate of 500 shares of Series B Preferred Stock.  The Company recorded the fair value of the Series B Preferred Stock of $484,530 as mezzanine equity and reduced common shares and additional paid in capital an equal amount.

f) On August 21, 2018, the Company received $80,000 pursuant to a promissory note issued to the President of the Company. The note issued is unsecured, due on August 20, 2019 and bears interest at a rate of 8% per annum. At March 31, 2019 and December 31, 2018, the amount of $80,000 was owed,

g) On June 1, 2018, the Company entered into an employment agreement with the Chief Executive Officer of the Company. The agreement has a three year term and provides for base compensation of $350,000 per year as well as bonuses including stock options.

h) On June 1, 2018, the Company entered into an employment agreement with the President of the Company. The agreement has a three year term and provides for base compensation of $340,000 per year as well as bonuses including stock options.

	March 31, 2019		December 31, 2018
Promissory note issued to Roger Ponder, 10% interest, unsecured, matured on November 30, 2018 and extended to November 30, 2019	$	18,858	$	18,858
Promissory note issued to Keith Hayter, 10% interest, unsecured, matured on November 30, 2018 and extended to November 30, 2019		130,000		130,000
Promissory note issued to Keith Hayter, 8% interest, unsecured, matures April 10, 2019		85,000		85,000
Promissory note issued to Keith Hayter, 8% interest, unsecured, matures August 20, 2019		80,000		80,000
Total	$	313,858	$	313,858

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Loans Payable

3 Months Ended

Mar. 31, 2019

Debt Disclosure [Abstract]

Loans Payable

7. Loans Payable

a) As of March 31, 2019, the amount of $49,121 (Cdn$63,300) (December 31, 2018 - $49,121 (Cdn$63,300)) is owed to a non-related party which is non-interest bearing, unsecured, and due on demand.

b) As at March 31, 2019, the amount of $15,000 (December 31, 2018 - $15,000) is owed to non-related parties which is non-interest bearing, unsecured, and due on demand.

c) As of March 31, 2019, the amounts of $7,500 and $2,636 (Cdn$3,400) (December 31, 2018 - $7,500 and $2,636 (Cdn$3,400)) are owed to a non-related party which are non-interest bearing, unsecured, and due on demand.

d) In March 2012, the Company received $50,000 for the subscription of 10,000,000 shares of the Company’s common stock. During the year ended May 31, 2013, the Company and the subscriber agreed that the shares would not be issued and that the subscription would be returned. The subscription has been reclassified as a non-interest bearing demand loan until the funds are refunded to the subscriber.

e) On August 4, 2015, the Company borrowed $50,000 pursuant to a promissory note. The note was due on September 4, 2015. The note bears interest at 120% per annum prior September 4, 2015, and at 180% per annum after September 4, 2015. The holder of the note was also granted the rights to buy 500 shares of the Company’s common stock at a price of $30 per share until August 4, 2017. During the year ended May 31, 2016, the Company repaid the $50,000 note and $1,200 of accrued interest remains owing. At March 31, 2019, and December 31, 2018, $1,200 of accrued interest remained owing.

f) On April 12, 2017, received $12,000 pursuant to a promissory note. The note issued is unsecured, due on demand and bears interest at a rate of 10% per annum. At March 31, 2019 and December 31, 2018, the amount of $12,000 was owed.

g) On October 10, 2018, the Company’s wholly-owned subsidiary, ADEX Corporation (the “Borrower”), entered into a Loan and Security Agreement (the “Loan and Security Agreement”) with Heritage Bank of Commerce (the “Lender”). Under the Loan and Security Agreement, the Borrower may borrow an aggregate outstanding amount not to exceed the lesser of up to (i) $5,000,000 or (ii) the Borrowing Base (as defined in the Loan and Security Agreement) through one or more advances through October 10, 2020 (the “Maturity Date”), subject to the Lender’s satisfactory annual review of the Borrower on or around October 10, 2019. On the Maturity Date, all advances must be repaid. The Lender may, in its sole discretion and upon the Borrower’s request, make advances to the Borrower after the Maturity Date subject to the terms and conditions under the Loan and Security Agreement. Part of the proceeds of the initial credit extension of the Loan and Security Agreement were used to pay off borrowings owed to Prestige Capital Corporation described in Note 9(l).

Interest is payable under the Loan and Security Agreement at a per annum rate equal to the Prime Rate (as defined in the Loan and Security Agreement) plus 2%. The Borrower’s obligations under the Loan and Security Agreement are secured by all assets of the Company and ADEX Puerto Rico LLC. In addition, the Company issued a warrant (the “Warrant”) to the Lender to purchase an amount of shares of the Company’s common stock equal to $150,000 divided by the Warrant Price (as defined in the Warrant) at a price per share equal to 125% of the prior day’s closing price.

The Loan and Security Agreement provides that upon the occurrence of an event of default, among other things, all outstanding amounts under the Loan and Security Agreement or any portion thereof becomes immediately due and payable. Events of default under the Loan and Security Agreement include, among other items, the Borrower’s failure to comply with certain affirmative and negative covenants relating to the Company, its securities and its financial condition.

In connection with the financing, on October 10, 2018, the Company also issued a warrant to purchase 113,953 shares of the Company’s common stock at $1.25 per share for three years. The fair value of the warrants of $87,410 and $190,000 of debt issuance costs resulted in a discount to the note payable of $277,410. At December 31, 2018, the Company owed $3,483,015 pursuant to this agreement and will record accretion equal to the debt discount of $257,194 over the remaining term of the note. At during the three months ended March 31, 2019 the Company borrowed an additional $1,063,686 and recorded accretion of $108,014. At March 31, 2019, the Company owed $4,546,701 pursuant to this agreement and will record accretion equal to the debt discount of $149,180 over the remaining term of the note.

h) On January 4, 2019, the “Company, together with its subsidiaries, AW Solutions, Inc., AW Solutions Puerto Rico, LLC, Tropical Communications, Inc., ADEX Corp., ADEX Puerto Rico, LLC, and Telnet Solutions, Inc (collectively with the Company, the “Financing Parties”), entered into an Agreement of Sale of Future Receipts (the “Financing Agreement”) with Libertas Funding LLC, a Connecticut limited liability company (“Libertas”). Under the Financing Agreement, the Financing Parties sold to Libertas future receivables in an aggregate amount equal to $1,460,000 for a purchase price of $1,000,000.

Pursuant to the terms of the Financing Agreement, the Company agreed to pay Libertas $31,602 each week based upon an anticipated 20% of its future receivables until such time as $1,460,000 has been paid, a period Libertas and the Financing Parties estimated to be approximately eleven months. In the event that the Financing Agreement is paid off earlier than eleven months, there is a discount to the sum owed. The Financing Agreement also contains customary affirmative and negative covenants, representations and warranties, and default and termination provisions. The Company used the proceeds of the Financing Agreement for the acquisition of TNS, as discussed in Note 3.

On February 1, 2019, the Company fully repaid the Financing Agreement.

i) At March 31, 2019, the Company owed $1,325,895 to WaveTech Global Inc. (“WaveTech”) pursuant to the Share Purchase Agreement described in Note 14. If the acquisition described does not close the advance has a term of 60 days and bears interest at 12%.

	March 31, 2019		December 31, 2018
Promissory note issued to J. Thacker, non-interest bearing, unsecured and due on demand	$	41,361	$	41,361
Promissory note issued to S. Kahn, non-interest bearing, unsecured and due on demand	$	7,760	$	7,760
Promissory note issued to 0738856 BC Ltd, non-interest bearing, unsecured and due on demand		15,000		15,000
Promissory note issued to Bluekey Energy, non-interest bearing, unsecured and due on demand		7,500		7,500
Promissory note issued to 0738856 BC ltd non-interest bearing, unsecured and due on demand		2,636		2,636
Subscription amount due to T. Warkentin non-interest bearing, unsecured and due on demand		50,000		50,000
Promissory note issued to Old Main Capital LLC, 8% interest, unsecured and due on demand		12,000		12,000
Promissory note issued to InterCloud Systems, Inc., non-interest bearing, unsecured and due on demand		275,000		275,000
Loan with Heritage Bank of Commerce, interest rate of prime plus 2%, secured by all assets of the Company, matures October 20, 2020, net of debt discount of $149,180 and $257,194		4,397,521		3,225,821
Loan with WaveTech Global, Inc., interest rate of 12%,  matured April 28, 2019		1,325,895		-
Total	$	6,134,673	$	3,637,078

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Convertible Debentures

3 Months Ended

Mar. 31, 2019

Debt Disclosure [Abstract]

Convertible Debentures

8. Convertible Debentures

a) On April 27, 2017, the Company issued a convertible promissory note in the aggregate principal amount of $2,000,000. The interest on the outstanding principal due under the Unsecured Note accrues at a rate of 8% per annum. All principal and accrued interest under the Unsecured Note is due one year following the issue date of the Unsecured Note and is convertible into shares of common stock at a conversion price equal to 75% of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion.     

The embedded conversion option qualifies for derivative accounting and bifurcation under ASC 815-15 “Derivatives and Hedging”. The initial fair value of the conversion feature of $1,174,000 resulted in a discount to the note payable of $943,299. On December 15, 2017, February 14, 2018, February 21, 2018, June 7, 2018, January 24, 2019, and March 15, 2019 the holder of the convertible promissory note entered into agreement to sell and assign a total of $105,000, $105,000, $105,000, $39,375, $100,000 and $100,000 of the outstanding principal, respectively to a third party. The Company approved and is bound by the assignment and sale agreement. As a result of the assignment, the conversion price for the total of $354,375 of notes assigned is now equal to the lesser 70% of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion and $8. The Company accounted for this assignment in accordance with ASC 470-50 “Modifications and Extinguishments”. In accordance with ASC 470-50, the Company accounted for the assignment as a debt extinguishment and adjusted the fair value of the derivative to its fair value on the assignment date. During the year ended December 31, 2018, the entire December 15, 2017 note of $105,000, the entire February 14, 2018 note of $105,000 and $55,000 of the February 21, 2018 $105,000 note was converted into 661,795 shares of common stock. The February 21, 2018, June 7, 2018, notes are described in Notes 8(b), and (c) respectively. The January 24, 2019 and March 15, 2019 assignments are described in Note 8(d). At March 31, 2019, the carrying value of the notes was $1,445,625,

b) On February 21, 2018, the holder of the convertible promissory note described in Note 8(a) entered into agreements to sell and assign a total of $105,000, of the outstanding principal to a third party. During the year ended December 31, 2018, $55,000 of the note was converted. During the three months ended March 31, 2019, $44,250 of the note was converted into 583,156 shares of common stock. At March 31, 2019, the carrying value of the notes was $5,750.

c) On June 7, 2018, the holder of the convertible promissory note described in Note 8(a) entered into agreements to sell and assign a total of $39,375, of the outstanding principal to a third party. During the three months ended March 31, 2019, $39,375 of the note was converted into 576,501 shares of common stock. At March 31, 2019, the carrying value of the notes was $Nil.

d) On January 24, 2019 and March 15, 2019, the holder of the convertible promissory note described in Note 8(a) entered into agreements to sell and assign a total of $200,000, of the outstanding principal to a third party. During the three months ended March 31, 2019, $75,000 and $7,499 of the note was converted into 1,071,418 shares of common stock. At March 31, 2019, the carrying value of the notes was $25,000.  

e) On February 27, 2018, the Company issued a convertible promissory note in the aggregate principal amount of $2,000,000. The interest on the outstanding principal due under the ADEX Note accrues at a rate of 6% per annum. All principal and accrued interest under the ADEX Note is due one year following the issue date of the ADEX Note and is convertible into shares of common stock at a conversion price equal to of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion, but in no event ever lower than $1 (the “Floor”), unless the note is in default, at which time the Floor terminates. 

The embedded conversion option qualifies for derivative accounting and bifurcation under ASC 815-15 “Derivatives and Hedging”. The initial fair value of the conversion feature of $2,455,000 resulted in a discount to the note payable of $639,000.

On September 26, 2018, the holder of the convertible promissory note entered into agreement to sell and assign a total of $75,000 of the outstanding principal to a third party. The Company approved and is bound by the assignment and sale agreement. As a result of the assignment, the assigned note bears interest at 5% and the conversion price for the $75,000 of notes assigned is now equal to the lesser 75% of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion and $8. On December 3, 2018, the holder of the convertible promissory note entered into agreement to sell and assign a total of $50,000 of the outstanding principal to a third party. The Company accounted for the assignments in accordance with ASC 470-50 “Modifications and Extinguishments”. In accordance with ASC 470-50, the Company accounted for the assignment as a debt extinguishment and adjusted the fair value of the derivative to its fair value on the assignment date. During the year ended December 31, 2018, $74,993 of the note was converted into 321,500 shares of common stock. During the year ended December 31, 2018, the Company recorded accretion of $352,251 increasing the carrying value of the notes to $1,565,681.

During the three months ended March 31, 2019, $49,995 of the note was converted into 617,600 shares of common stock. During the three months ended March 31, 2019, the Company repaid $45,077 and recorded accretion of $125,967 increasing the carrying value of the notes to $1,596,577.

f) The Company also issued InterCloud a convertible note with a principal amount of $793,894 to settle a contingent liability of $793,893 owed as a result of the acquisition of AWS. The note is due on August 16, 2019 and bears interest at 1% per annum. The note is convertible into common shares of the Company at a conversion price equal to the 80% of the lowest volume-weighted average price during the 5 trading days immediately preceding the date of conversion.

The embedded conversion option qualifies for derivative accounting and bifurcation under ASC 815-15 “Derivatives and Hedging”. The initial fair value of the conversion feature of $348,000 resulted in a discount to the note payable of $348,000. During the three months ended March 31, 2019, the Company recorded accretion of $62,466 increasing the carrying value of the notes to $684,858.

g) On February 21, 2018, the Company issued a convertible note with a principal amount of $500,000 and a warrant with a term of three years to purchase up to 125,000 shares of common stock of the Company at an exercise price of $1.60 per share. The exercise price of the warrant will reduce to 85% of the closing price of the Company’s common stock if the closing price of the Company’s common stock is less than $1.60 on July 31, 2018. The note was due on January 15, 2019, and in February 2019, the maturity date was extended to June 1, 2019, and bears interest at 6% per annum. The note is convertible into common shares of the Company at a conversion price equal to the lower of 80% of the lowest volume-weighted average price during the 5 trading days immediately preceding the date of conversion and $1 (the “Floor”), unless the note is in default, at which time the Floor terminates.

The embedded conversion option and warrant qualified for derivative accounting and the conversion option qualified for bifurcation under ASC 815-15 “Derivatives and Hedging”. The initial fair value of the conversion feature of $571,079 and the warrant of $158,772 resulted in a discount to the note payable of $500,000 and an initial derivative expense of $229,851. During the three months ended March 31, 2019, the Company recorded accretion of $55,000 increasing the carrying value of the notes to $500,000.

h) On April 23, 2018, the Company entered into and closed on a Securities Purchase Agreement with an institutional investor, pursuant to which the Company issued to the lender a senior secured convertible promissory note in the aggregate principal amount of $1,578,947 for an aggregate purchase price of $1,500,000.

The interest on the outstanding principal due under the secured note accrues at a rate of 12% per annum. All principal and accrued interest under the secured note is due on October 23, 2019 and is convertible into shares of the Company’s common stock at a fixed conversion price of $1.00. While during the first three months that the secured note is outstanding, only interest payments are due to the lender, beginning in month four, and on each monthly anniversary thereafter until maturity, amortization payments are due for principal and interest due under the secured note. The secured note includes customary events of default, including non-payment of the principal or accrued interest due on the secured note. Upon an event of default, all obligations under the secured note will become immediately due and payable.

If the Company issues any common stock or common stock equivalents at an effective price per share less than $1 then the conversion price of the note will be reduced to the lower price. As long as the note is not in default the Company may repay the note at 110% of the outstanding principal amount. If the Company defaults upon the note it bears interest at 18% per annum.

In connection with the Purchase Agreement, the Company entered into a security agreement, dated as of April 23, 2018, with the Lender (the “Security Agreement”) and an intellectual property security agreement, dated as of April 23, 2018, with the Lender pursuant to which the Company granted a security interest in substantially all of the assets of the Company, but for those assets over which Prestige Capital Corporation holds a lien, to secure the Company’s obligations under the secured note. In addition, all of the Company’s subsidiaries are guarantors of the Company’s obligations to the Lender pursuant to the Secured Note.

The embedded conversion option qualified for derivative accounting and the conversion option qualified for bifurcation under ASC 815-15 “Derivatives and Hedging”. The initial fair value of the conversion feature of $3,325,000 resulted in a discount to the note payable of $1,500,000 and an initial derivative expense of $1,825,000. During the three months ended March 31, 2019, the Company repaid $131,579 of the note which resulted in a $72,000 gain on the extinguishment of the note and associated derivative liability. During the three months ended March 31, 2019, the Company recorded accretion of $130,500 increasing the carrying value of the notes to $239,291

i) On May 18, 2018, the Company entered into and closed on a Securities Purchase Agreement with an institutional investor, pursuant to which the Company issued to the investor a senior secured convertible promissory note in the aggregate principal amount of $295,746 for an aggregate purchase price of $280,959.

The interest on the outstanding principal due under the secured note accrues at a rate of 12% per annum. All principal and accrued but unpaid interest under the secured note is due on May 18, 2019. The secured note is convertible into shares of the Company’s common stock at a fixed conversion price of $1 per share. Interest is payable monthly on the 18th of each month. While interest payments must be made in cash during the first six months that the secured note is outstanding, beginning in month seven, and on each monthly anniversary thereafter until maturity, the Company has the option to pay interest payments in stock, subject to certain equity conditions being satisfied. Any payment of interest or principal scheduled after December 1, 2018 that is made in cash will be subject to a 5% prepayment premium. Any other prepayment is subject to a 10% premium. The secured note includes customary events of default, including non-payment of the principal or accrued interest due on the secured note and cross default to other notes owing to the investor. Upon an event of default, all obligations under the secured note and other notes owing to the investor will become immediately due and payable. In connection with the issuance of the secured note, the Company issued the investor 496,101 shares of Series A Preferred Stock with a fair value of $193,509 which was expensed. The investor was granted a right to participate in future financing transactions of the Company while the secured note remains outstanding.

If the Company issues any common stock or common stock equivalents at an effective price per share less than $1 then the conversion price of the note will be reduced to the lower price. As long as the note is not in default the Company may repay the note at 110% of the outstanding principal amount. If the Company defaults upon the note it bears interest at 18% per annum.

In connection with the Securities Purchase Agreement, the Company entered into an amendment to the existing Security Agreement described in Note 10(o). Pursuant to the amendment, the Company agreed that obligations under the secured note and related documents will be secured pursuant to the existing security interest in substantially all of the assets of the Company securing other notes issued to the Investor (except for those assets over which Prestige Capital Corporation holds a lien). In addition, all of the Company’s subsidiaries are guarantors of the Company’s obligations to the Investor pursuant to the Secured Note and have granted a similar security interest over substantially their assets.

The embedded conversion option qualified for derivative accounting and the conversion option qualified for bifurcation under ASC 815-15 “Derivatives and Hedging”. The initial fair value of the conversion feature of $468,000 resulted in a discount to the note payable of $280,959 and an initial derivative expense of $187,041. During the three months ended March 31, 2019, the Company recorded accretion of $89,783 increasing the carrying value of the notes to $212,959.

j) On July 3, 2018, the Company entered into and closed on a Securities Purchase Agreement with an institutional investor, pursuant to which the Company issued to the investor a senior secured convertible promissory note in the aggregate principal amount of $78,947 for an aggregate purchase price of $75,000.

The interest on the outstanding principal due under the secured note accrues at a rate of 12% per annum. All principal and accrued but unpaid interest under the secured note is due on March 15, 2019. The secured note is convertible into shares of the Company’s at the greater of $0.80 or 75% of the lowest VWAP in the 10 trading days prior to conversion.

The Company may repay the note at 115% of the outstanding principal amount. If the Company defaults upon the note it bears interest at 18% per annum.

The embedded conversion option qualified for derivative accounting and the conversion option qualified for bifurcation under ASC 815-15 “Derivatives and Hedging”. The initial fair value of the conversion feature of $23,000 resulted in a discount to the note payable of $23,000. During the year ended December 31, 2018, the Company recorded accretion of $17,860 increasing the carrying value of the notes to $69,860. During the three months ended March 31, 2019, the Company repaid the note in full and recognized a loss on settlement of debt of $2,300.

k) On July 31, 2018, the Company entered into and closed on a Securities Purchase Agreement with an institutional investor, pursuant to which the Company issued to the investor a senior secured convertible promissory note in the aggregate principal amount of $78,947 for an aggregate purchase price of $75,000.

The interest on the outstanding principal due under the secured note accrues at a rate of 12% per annum. All principal and accrued but unpaid interest under the secured note is due on March 15, 2019. The secured note is convertible into shares of the Company’s at the greater of $1 or 75% of the lowest VWAP in the 10 trading days prior to conversion.

The Company may repay the note at 115% of the outstanding principal amount. If the Company defaults upon the note it bears interest at 18% per annum.

The embedded conversion option qualified for derivative accounting and the conversion option qualified for bifurcation under ASC 815-15 “Derivatives and Hedging”. The initial fair value of the conversion feature of $103,000 resulted in a discount to the note payable of $75,000 and an initial derivative expense of $28,000. During the year ended December 31, 2018, the Company recorded accretion of $37,554 increasing the carrying value of the notes to $37,554. During the three months ended March 31, 2019, the Company repaid the note in full and recognized a loss on settlement of debt of $90,000.

l) On December 4, 2018, the Company entered into and closed on a Securities Purchase Agreement with an institutional investor, pursuant to which the Company issued to the investor a senior secured convertible promissory note in the aggregate principal amount of $27,500 for an aggregate purchase price of $25,000.

The interest on the outstanding principal due under the secured note accrues at a rate of 8% per annum. All principal and accrued but unpaid interest under the secured note is due on December 4, 2019. The secured note is convertible into shares of the Company’s at 65% of lowest trading price for the fifteen trading days prior to the conversion date.

The Company may repay the note at 150% of the outstanding principal amount. If the Company defaults upon the note it bears interest at 18% per annum.

The embedded conversion option qualified for derivative accounting and the conversion option qualified for bifurcation under ASC 815-15 “Derivatives and Hedging”. The initial fair value of the conversion feature of $30,000 resulted in a discount to the note payable of $25,000 and an initial derivative expense of $5,000. During the three months ended March 31, 2019, the Company recorded accretion of $2,484 increasing the carrying value of the notes to $5,844. 

m) On January 4, 2019, as part of the acquisition described in Note 3, the Company issued to InterCloud a convertible promissory note in the aggregate principal amount of $620,000 (the “Note”). 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 Company 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.

The embedded conversion option qualifies for derivative accounting and bifurcation under ASC 815-15 “Derivatives and Hedging”. The initial fair value of the conversion feature of $189,000 resulted in a discount to the note payable of $144,000.

On January 28, 2019, the holder of the convertible promissory note entered into agreement to sell and assign a total of $620,000 of the $620,000 outstanding principal to two third parties, with $186,000 and $434,000 of principal assigned to each party. The Company approved and is bound by the assignment and sale agreement. During the three months ended March 31, 2019, $70,000 of each of the notes was converted into a total of 1,400,000 shares of common stock. During the three months ended March 31, 2019, the Company recorded accretion of $13,011 and $23,645 on the two notes increasing the carrying value of the two notes to $85,844 and $286,845 respectively.

	March 31, 2019		December 31, 2018
Convertible promissory note, InterCloud Systems, Inc,, 8% interest, unsecured, matured April 27, 2018, net of debt discount of $0 and $361,333	$	1,445,625	$	1,735,000
Convertible promissory note, InterCloud Systems, Inc,, 6% interest, unsecured, matured March 27, 2019, net of debt discount of $160,782 and $286,749		1,596,542		1,565,681
Convertible promissory note, InterCloud Systems, Inc,, 1% interest, unsecured, matures August 16, 2019, net of debt discount of $109,036 and $171,557		684,858		622,392
Convertible promissory note, Barn 11, 6% interest, unsecured, matures June 1, 2019, net of debt discount of $0 and $45,000		500,000		445,000
Convertible promissory note, Dominion Capital, 18% interest, secured, matures October 23,2019, net of debt discount of $879,130 and $1,009,630		239,291		240,370
Convertible promissory note, Dominion Capital, 12% interest, unsecured, matures May 18, 2019, net of debt discount of $82,787 and $172,570		212,959		123,176
Convertible promissory note, M2B Funding, 12% interest, unsecured, matures March 15, 2019, net of debt discount of $0 and $9,087		-		69,860
Convertible promissory note, M2B Funding, 12% interest, unsecured, matures March 15, 2019, net of debt discount of $0 and $41,395		-		37,552
Convertible promissory note, Silverback, 8% interest, unsecured, matures December 4, 2019, net of debt discount of $21,656 and $24,140		5,844		3,360
Convertible promissory note, Michael Roeske, 6% interest, unsecured, matures, January 30, 2020, net of debt discount of $30,189 and $0		85,844		-
Convertible promissory note, Joel Raven, 6% interest, unsecured, matures January 30, 2020, net of debt discount of $77,155 and $0		286,845		-
Convertible promissory note, Virtual Capital, LLC, 0% interest, unsecured, matured, January 24, 2019		125,000
Convertible promissory note, RDW Capital LLC, 9.9% interest, unsecured, matured March 30, 2019, net of debt discount of $0 and $0		5,750		-
Total	$	5,188,558	$	4,842,391

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Derivative Liabilities

3 Months Ended

Mar. 31, 2019

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Liabilities

9. Derivative Liabilities

The embedded conversion option of the convertible debenture described in Note 8 contain conversion features that qualify for embedded derivative classification. The fair value of the liability will be re-measured at the end of every reporting period and the change in fair value will be reported in the statement of operations as a gain or loss on derivative financial instruments.

Upon the issuance of the convertible note payable described in Note 8, the Company concluded that it only has sufficient shares to satisfy the conversion of some but not all of the outstanding convertible notes, warrants and options. The Company elected to reclassify contracts from equity with the earliest inception date first. As a result, none of the Company's previously outstanding convertible instruments qualified for derivative reclassification, however, any convertible securities issued after the election qualified for derivative classification. The Company reassesses the classification of the instruments at each balance sheet date. If the classification changes as a result of events during the period, the contract is reclassified as of the date of the event that caused the reclassification.

The table below sets forth a summary of changes in the fair value of the Company's Level 3 financial liabilities.

	March 31, 2019			December 31, 2018
Balance at the beginning of period	$	3,166,886		$	4,749,712
Derivative issued as part of acquisition		-			302,800
Original discount limited to proceeds of notes		189,000			2,839,369
Fair value of derivative liabilities in excess of notes proceeds received		-			2,274,892
Derivative warrants issued for services and to acquire non-controlling interest		-			328,833
Derivative liability settled through the issuance of preferred stock		-			(291,064	)
Conversion of derivative liability		(686,135	)		(678,142	)
Repayment of convertible note		(164,468	)		(310,041	)
Change in fair value of embedded conversion option		369,391			(6,049,473	)
Balance at the end of the period	$	2,874,674		$	3,166,886

The Company uses Level 3 inputs for its valuation methodology for the embedded conversion option liabilities as their fair values were determined by using Monte-Carlo model or a Binomial Model based on various assumptions. 

Significant changes in any of these inputs in isolation would result in a significant change in the fair value measurement. As required, these are classified based on the lowest level of input that is significant to the fair value measurement. The following table shows the assumptions used in the calculations:

	Expected Volatility			Risk-free Interest Rate			Expected Dividend Yield			Expected Life (in years)
At issuance		204	%		2.57	%		0	%		1.07
At December 31, 2018		172-381	%		2.45-2.63	%		0	%		0.04-2.78
At March 31, 2019		215-386	%		2.27-2.44	%		0	%		0.25-2.53

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Common Stock

3 Months Ended

Mar. 31, 2019

Equity [Abstract]

Common Stock

10. Common Stock

On November 15, 2017, the Company revised its authorized share capital to increase the number of authorized common shares from 275,000,000 common shares with a par value of $0.00001, to 750,000,000 common shares with a par value of $0.00001.

Treasury stock- The Company holds 621,258 shares in treasury at a cost of $277,436.

a) As at December 31, 2017 and May 31, 2017, the Company's subsidiary, Mantra Energy Alternatives Ltd., had received subscriptions for 335 shares of common stock at Cdn$1.00 per share for proceeds of $66,277 (Cdn$67,000), which is included in common stock subscribed, net of the non-controlling interest portion of $7,231.

b) As at December 31, 2017 and May 31, 2017, the Company's subsidiary, Climate ESCO Ltd., had received subscriptions for 1,050 shares of common stock at $0.10 per share for proceeds of $21,000, which is included in common stock subscribed, net of the non-controlling interest portion of $7,384.

c) On September 28, 2018, the Company issued 5,010,000 shares of common stock with a fair value of $3,256,500 to employees of the Company in exchange for services for the Company. The shares vest over 36 months. During the period ended March 31, 2019, the Company recorded $422,988 for the vested portion of the shares, leaving $2,228,508 of unvested compensation expense to be recognized in future periods.

d) On October 9, 2018, the Company issued 520,000 shares of common stock with a fair value of $520,000 to employees of the Company in exchange for services for the Company. The shares vest over 36 months. During the period ended March 31, 2019, the Company recorded $34,395 for the vested portion of the shares, leaving $429,512 of unvested compensation expense to be recognized in future periods

e) On January 14, 2019, the Company issued 100,000 shares of common stock upon the conversion of $9,746 of principal pursuant to the loan described in Note 8(e).

f) On January 14, 2019, the Company issued 110,742 shares of common stock upon the conversion of $10,000 of principal pursuant to the loan described in Note 8(b).

g) On January 28, 2019, the Company issued 200,000 shares of common stock upon the conversion of $15,552 of principal pursuant to the loan described in Note 8(e).

h) On February 1, 2019, the Company issued 2,869,230 shares of common stock to employees and directors of the Company in exchange for services for the Company. The shares vest over periods between 11 and 36 months. During the quarter ended March 31361,490 of unvested compensation expense to be recognized in future periods

i) On February 7, 2019, the holder of the assigned note converted $75,000 of the note and $7,499 of interest into 1,071,418 shares of the Company's common stock.

j) On February 7, 2019, the Company issued 172,414 shares of common stock upon the conversion of $12,500 of principal pursuant to the loan described in Note 8(b).

k) On February 11, 2019, the Company issued 317,600 shares of common stock upon the conversion of $24,697 of principal pursuant to the loan described in Note 8(e).

l) On February 12, 2019, the Company issued 300,000 shares of common stock upon the conversion of $21,750 of principal pursuant to the loan described in Note 8(b).

m) On February 14, 2019, the Company issued 1,400,000 shares of common stock upon the conversion of $140,000 principal pursuant to the convertible promissory note described in Note 8(m).

n) On March 7, 2019, the Company issued 576,501 shares of common stock upon the conversion of $39,375 of principal pursuant to the loan described in Note 8( c).

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Preferred Stock

3 Months Ended

Mar. 31, 2019

Equity [Abstract]

Preferred Stock

11. Preferred Stock

Series A

On November 15, 2017, the Company created one series of the 20,000,000 preferred shares it is authorized to issue, consisting of 8,000,000 shares, to be designated as Series A Preferred Shares.

On October 29, 2018, the Company amended and restated the Company's Series A Convertible Preferred Stock. The principal terms of the Series A Preferred Shares are as follows:

Voting rights – The Series A Preferred Shares do not have voting rights.

Dividend rights – The holders of the Series A Preferred Shares shall not be entitled to receive any dividends. No dividends (other than those payable solely in common stock) shall be paid on the common stock or any class or series of capital stock ranking junior, as to dividends, to the Series A Preferred Shares during any fiscal year of the Corporation until there shall have been paid or declared and set apart during that fiscal year for the holders of the Series A Preferred Shares a dividend in an amount per share equal to (i) the number of shares of common stock issuable upon conversion of the Series A Preferred Stock times (ii) the amount per share of the dividend to be paid on the common stock.

Conversion rights – The holders of the Series A Preferred Shares have the right to convert each Class A Preferred Share and all accrued and unpaid dividends thereon shall be convertible at the option of the holder thereof, at any time after the issuance of such share into fully paid and nonassessable shares of common stock of the Corporation. The number of shares of common stock into which each share of the Series A Preferred Shares may be converted shall be determined by dividing the sum of the Stated Value of the Series A Preferred Shares ($1.00 per share) being converted and any accrued and unpaid dividends by the Conversion Price in effect at the time of the conversion. The Series A Preferred Shares may be converted at an initial conversion price of the greater of 75% of the lowest VWAP during the ten trading day period immediately preceding the date a conversion notice is delivered or $0.40 subject to adjustment for any subdivision or combination of the Company's outstanding shares of Common Stock.

Liquidation rights – Upon the occurrence of any liquidation, each holder of Series A Preferred Shares then outstanding shall be entitled to receive, out of the assets of the Corporation available for distribution to its stockholders, before any payment shall be made in respect of the common stock, or other series of preferred stock then in existence that is outstanding and junior to the Series A Preferred Shares upon liquidation, an amount per share of Series A Preferred Shares equal to the amount that would be receivable if the Series A Preferred Shares had been converted into common stock immediately prior to such liquidation distribution, plus, accrued and unpaid dividends.

In accordance with ASC 480 Distinguishing Liabilities from Equity, the Company has classified the Series A Preferred Shares as temporary equity or "mezzanine".

Series B

On April 16, 2018, the Company designated 1,000 shares of Series B preferred stock of the Company (the "Series B Preferred Stock") with a stated value of $3,500 per share. The Series B Preferred Stock is neither redeemable nor convertible into common stock. The principal terms of the Series A Preferred Shares are as follows:

Issue Price - The stated price for the Series B Preferred shall be $3,500 per share.

Redemption - The Series B Preferred are not redeemable.

Dividends - The holders of the Series B Preferred shall not be entitled to receive any dividends.

Preference of Liquidation - The Corporation's Series A Preferred Stock (the "Senior Preferred Stock) shall have a liquidation preference senior to the Series B Preferred. Upon any Fundamental Transaction, liquidation, dissolution or winding up of the Corporation, whether voluntary or involuntary, the Holders of the shares of the Series B Preferred shall be entitled, after any distribution or payment is made upon any shares of capital stock of the Corporation having a liquidation preference senior to the Series B Preferred, including the Senior Preferred Stock, but before any distribution or payment is made upon any shares of Common Stock or other capital stock of the Corporation having a liquidation preference junior to the Series B Preferred, to be paid in cash the sum of $3,500 per share. If upon such liquidation, dissolution or winding up, the assets to be distributed among the Series B Preferred Holders and all other shares of capital stock of the Corporation having the same liquidation preference as the Series B Preferred shall be insufficient to permit payment to said holders of such amounts, then all of the assets of the Corporation then remaining shall be distributed ratably among the Series B Preferred Holders and such other capital stock of the Corporation having the same liquidation preference as the Series B Preferred, if any. Upon any liquidation, dissolution or winding up of the Corporation, whether voluntary or involuntary, after provision is made for Series B Preferred Holders and all other shares of capital stock of the Corporation having the same liquidation preference as the Series B Preferred, if any, then-outstanding as provided above, the holders of Common Stock and other capital stock of the Corporation having a liquidation preference junior to the Series B Preferred shall be entitled to receive ratably all remaining assets of the Corporation to be distributed.

Voting - The holders of shares of Series B Preferred shall be voted together with the shares of Common Stock such that the aggregate voting power of the Series B Preferred is equal to 51% of the total voting power of the Company.

Conversion - There are no conversion rights.

In accordance with ASC 480 Distinguishing Liabilities from Equity, the Company has classified the Series B Preferred Shares as temporary equity or "mezzanine".

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Share Purchase Warrants

3 Months Ended

Mar. 31, 2019

Warrants and Rights Note Disclosure [Abstract]

Share Purchase Warrants

12. Share Purchase Warrants

The following table summarizes the continuity of share purchase warrants:

	Number of warrants			Weighted average exercise price $
Balance, December 31, 2018		1,715,177			2.14
Issued		284,717			1.20
Expired		(60,000	)		0.32
Balance, March 31, 2019		1,939,894			1.96

As at March 31, 2019, the following share purchase warrants were outstanding:

Number of warrants			Exercise price $		Expiry date
	20,375			74.00	April 10, 2019
	137,500			5.10	April 28, 2020
	250,000			0.10	June 27, 2020
	593,064	*		1.20	February 13, 2021
	125,000			1.60	February 21, 2021
	500,000			1.00	May 17, 2020
	200,000			0.00010	September 10, 2019
	113,955			1.08	October 10, 2021
	1,939,894

* This warrant is convertible into 4% of the number of common shares of the Company outstanding. At March 31, 2019, 4% of the number of shares of the Company outstanding was 14,826,590 shares.

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Leases

3 Months Ended

Mar. 31, 2019

Leases [Abstract]

Leases

13. Leases

In February 2016, the FASB issued ASU No. 2016-02, Leases, which introduced a lessee model that requires the majority of leases to be recognized on the balance sheet. On January 1, 2019, the Company adopted the ASU using the modified retrospective transition approach and elected the transition option to recognize the adjustment in the period of adoption rather than in the earliest period presented. The Company elected the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allowed us to carry forward the historical lease classification. Adoption of the new standard resulted in the recording of additional net lease assets and lease liabilities of approximately $269,341 and $269,341 respectively, as of January 1, 2019. During the three months ended March 31, 2019, non-cash right of use assets recorded in exchange for non-cash operating lease liabilities was $269,341. The Company leases certain office space and equipment. Leases with an initial term of 12 months or less are not recorded on the balance sheet; we recognize lease expense for these leases on a straight-line basis over the lease term.

The depreciable lives of operating lease assets and leasehold improvements are limited by the expected lease term. The Company’s leases generally do not provide an implicit rate, and therefore the Company uses its incremental borrowing rate as the discount rate when measuring operating lease liabilities. The Company used incremental borrowing rates as of January 1, 2019 for operating leases that commenced prior to that date.

The following table sets forth the operating lease right of use (“ROU”) assets and liabilities as of March 31, 2019:

	March 31, 2019
Operating lease assets	$	232,325
Operating lease liabilities:
Current operating lease liabilities	$	233,191
Total operating lease liabilities	$	233,191

Expense related to leases is recorded on a straight-line basis over the lease term, including rent holidays. During the three months ended March 31, 2019, the Company recognized operating lease expense of $48,175. Operating lease costs are included within selling, administrative and other expenses on the condensed consolidated statements of income and comprehensive income. During the three months ended March 31, 2019, short-term lease costs were $78,035.

Cash paid for amounts included in the measurement of operating lease liabilities were $47,309 for the three months ended March 31, 2019, and this amount is included in operating activities in the condensed consolidated statements of cash flows. During the three months ended March 31, 2019, the Company reduced its operating lease liabilities by $36,150 for cash paid.

The operating lease liabilities as of March 31, 2019 reflect a weighted average discount rate of 48%. Lease payments over the next five years and thereafter are as follows:

	March 31, 2019
2019	$	173,727
2020		88,431
2021		61,372
2022		63,214
2023		21,330
2024		-
Total lease payments		408,074
Less: imputed interest		(174,883	)
Total operating lease liabilities	$	233,191

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Commitments and Contingencies

3 Months Ended

Mar. 31, 2019

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

14. Commitments and Contingencies

(a) The Company leases certain of its properties under leases that expire on various dates through 2023. Some of these agreements include escalation clauses and provide for renewal options ranging from one to five years. Leases with an initial term of 12 months or less and immaterial leases are not recorded on the balance sheet.

(b) On February 4, 2019, the Company entered into a Share Purchase Agreement (the "Purchase Agreement") with WaveTech Global Inc. ("WaveTech"), a Delaware corporation, and the stockholders of WaveTech.   The merger of WaveTech into the Company shall be effected through a sale and exchange of shares and cash. Pursuant to the Purchase Agreement, in exchange for cash consideration and shares of common stock of the Company, the Company will acquire all right, title and interest in all of the issued and outstanding shares of stock of WaveTech. Upon the consummation of the transactions contemplated by the Purchase Agreement (the "Transactions"), WaveTech will become the majority controlling shareholder of the Company.   The consummation of the Transactions is also subject to the satisfaction or waiver (if permitted by law) of certain closing conditions, including, among other things, (i) the accuracy of the representations and warranties of the parties in all material respects, (ii) the performance of and compliance with the covenants of the parties in all material respects, (iii) receipt of certain regulatory approvals, (iv) approval by holders of a majority of WaveTech's common stock outstanding and entitled to vote and (v) consolidation of certain subsidiaries and affiliated entities of WaveTech into WaveTech.   The parties are required to use commercially reasonable efforts to cause to be taken and to do or cause to be done all actions and things as are necessary under the terms of the Purchase Agreement or under applicable law, in order to consummate the Transactions. The parties are also required to, among other things, cooperate in all respects with each other in connection with any filing or submission to any governmental authority in connection with the Transactions.   The Purchase Agreement also contains certain termination rights for both the Company and WaveTech, including that the Company or WaveTech may terminate the Purchase Agreement if the Transactions have not been consummated on or prior to February 28, 2019.   Upon consummation of the Transactions, the Company intends to rebrand itself under the WaveTech Global name, file for a name change to WaveTech Global Inc. and apply for an up-listing to the NASDAQ exchange, subject to filing and approval by NASDAQ and FINRA.   The Company's board of directors will expand to include three new board members from WaveTech. As of the date of these financial statements the transaction has not closed.

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Segment Disclosures

3 Months Ended

Mar. 31, 2019

Segment Reporting [Abstract]

Segment Disclosures

15. Segment Disclosures

During the three months ended March 31, 2019 and 2018, the Company had one operating segment including:

● AW Solutions Inc., a Longwood, Florida-based company, AW Solutions Puerto Rico LLC, ADEX Corporation and ADEX Puerto LLC which is in the business of the provision of professional, multi-service line, telecommunications infrastructure and outsource services to the wireless and wireline industry, ADEX Corporation and ADEX Puerto Rico LLC offering turnkey wireless and wireline telecom service and project staffing and  TNS, Inc., an Illinois corporation (acquired January 4, 2019) which is a communications contractor that specializes in the design, installation and maintenance of structured cabling systems and,

● Spectrum Global Solutions (SGS), which consists of the rest of the Company’s operations.

Factors used to identify the Company’s reportable segments include the organizational structure of the Company and the financial information available for evaluation by the chief operating decision-maker in making decisions about how to allocate resources and assess performance. The Company’s operating segments have been broken out based on similar economic and other qualitative criteria. The Company operates the SGS reporting segment in one geographical area (the United States), the AW Solutions operating segment in two geographical areas (the United States and Puerto Rico), and the ADEX operating segment in two geographical areas (the United States and Puerto Rico).

Financial statement information by operating segment for the three months ended March 31, 2019 is presented below:

	Spectrum Global $			AWS/ADEX/TNS $		Total $
Net Sales		–			11,335,732		11,335,732
Operating (loss) income		(954,967	)		969,666		14,699
Interest expense		399,555			71,857		471,412
Depreciation and amortization		-			93,952		93,952
Total Assets as of March 31, 2019		15,067			18,021,819		18,036,886

Geographic information for the three months ended and as at March 31, 2019 is presented below:

	Revenues $		Long-Lived Assets $
Puerto Rico		310,478		3,371
United States		11,025,254		6,817,755
Consolidated Total		11,335,732		6,821,126

Financial statement information by operating segment for the three months ended March 31, 2018 is presented below:

	Spectrum Global $			AWS/ADEX $			Total $
Net Sales		–			4,327,764			4,327,764
Operating (loss) income		(666,249	)		(77,242	)		(743,491	)
Interest expense		107,894			71,431			179,325
Depreciation and amortization		–			47,833			47,833
Total Assets as of December 31, 2018		99,835			12,830,561			10,774,123

Geographic information for the three months ended March 31, 2018 is presented below:

	Revenues $		Long-Lived Assets $
Puerto Rico		466,624		5,377
United States		3,861,140		4,016,895
Consolidated Total		4,327,764		4,022,273

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Net (Loss) Income Per Share

3 Months Ended

Mar. 31, 2019

Net Loss Income Per Share [Abstract]

Net (Loss) Income Per Share

16. Net (Loss) Income Per Share

	Three Months			Three Months
	Ended			Ended
	March 31,			March 31,
	2019			2018
	$			$
Numerator:
Net income (loss)		(1,332,587	)		134,269
Convertible note interest		–			87,860
Adjusted diluted net income (loss)		(1,332,587	)		222,129
Denominator:
Weighted average shares outstanding used in computing net income per share:
Basic		11,771,927			2,225,809
Effect of dilutive stock options and convertible notes payable		–			6,194,355
Effect of preferred shares		–			8,842
Diluted		11,771,927			8,429,006
Net income (loss) per share applicable to common stockholders:
Basic		(0.11	)		0.06
Diluted		(0.11	)		0.03

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Subsequent Events

3 Months Ended

Mar. 31, 2019

Subsequent Events [Abstract]

Subsequent Events

17. Subsequent Events

a)	On April 2. 2019, the Company issued 1,400,000 shares of common stock upon the conversion of $70,000 and $6.930 of accrued interest described in Note 8 (d).
b)	On April 13, 2019, the Company amended the note described in Note 6(d). Pursuant to the amendment, the notes maturity was extended from April 13, 2019 to April 13, 2020. In addition, the interest rate increased from 8% to 10%.

c) On April 23, 2019, the Company issued 799,980 shares of common stock upon the conversion of $30,000 and $9,999 of accrued interest described in Note 8(d).

d) On April 23, 2019, the Company issued 699,980 shares of common stock upon the conversion of $25,000 and $9,999 of accrued interest described in Note 8(d).

e) On May 3, 2019, the Company and Dominion Capital LLC (the “Holder”) entered into an exchange agreement (the “Exchange Agreement”) to exchange the two Senior Secured Convertible Promissory Notes described in Notes 8(h) and (i), with principal amounts of $1,052,632 plus accrued interest and $295,746 plus accrued interest respectively, for a single Senior Secured Convertible Promissory note with a principal amount of $1,571,134 (the “Exchange Note”).

The interest on the outstanding principal due under the Exchange Note accrues at a rate of 12% per annum. All principal and accrued interest under the Exchange Note is due on October 17, 2020 and is convertible into shares of the Company’s Common Stock. The conversion price in effect on the date such conversion is effected shall be equal to (i) initially, $0.10 or (ii) on or after the date of the closing of the next public or private offering of equity or equity-linked securities of the Company in which the Company receives gross proceeds in an amount greater than $100,000, one hundred and five percent (105%) of the price of the Common Stock issuable in the offering. While during the first six months that the Exchange Note is outstanding, only interest payments are due to the Holder, beginning in October 2019, and on each monthly anniversary thereafter until maturity, amortization payments are due for principal and interest due under the Exchange Note. The Exchange Note includes customary events of default, including non-payment of the principal or accrued interest due on the Exchange Note. Upon an event of default, all obligations under the Exchange Note will become immediately due and payable.

The Holder was granted a right to participate in future financing transactions of the Company while the Exchange Note remains outstanding.

f) On May 6, 2019, in accordance with terms of the notes described in Notes 8(a) and (e), the Company issued an aggregate of 15,707,163 shares of the Company’s common stock to InterCloud pursuant to the automatic forced conversion of all outstanding obligations under the Notes, in full satisfaction thereof. The shares issued were unregistered and are subject to Rule 144 restrictions.

g) On May 10, 2019, the Company entered into an amendment to the note payable described in Note 8(g). Pursuant to the amendment the maturity date of the note was extended from January 15, 2019 to June 1, 2019.

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Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2019

Accounting Policies [Abstract]

Condensed financial statements

a) Condensed financial statements

The accompanying unaudited interim consolidated financial statements of the Company should be read in conjunction with the consolidated financial statements and accompanying notes filed with the U.S. Securities and Exchange Commission in the Company’s Form 10-K for the year ended December 31, 2018. In the opinion of management, the accompanying financial statements reflect all adjustments of a recurring nature considered necessary to present fairly the Company’s financial position and the results of its operations and its cash flows for the periods shown.

The preparation of financial statements in accordance with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported. Actual results could differ materially from those estimates. The results of operations and cash flows for the periods shown are not necessarily indicative of the results to be expected for the full year.

Basis of Presentation/Principles of Consolidation

b) Basis of Presentation/Principles of Consolidation

These consolidated financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States. These consolidated financial statements include the accounts of the Company and its subsidiaries, AW Solutions, Inc. (from the date of acquisition, April 25, 2017), Tropical Communications, Inc. (from the date of acquisition, April 25, 2017), AW Solutions Puerto Rico LLC. (from the date of acquisition, April 25, 2017), ADEX Corp., ADEX Puerto Rico, LLC and ADEXCOMM (from the date of acquisition, February 27, 2018), TNS, Inc. (from the date of acquisition, January 4, 2019). All the subsidiaries are wholly-owned. During the year ended December 31, 2018, the Company disposed of the following subsidiaries; Carbon Commodity Corporation, Climate ESCO Ltd., Mantra Energy Alternatives Ltd., Mantra China Inc., Mantra China Limited, Mantra Media Corp., Mantra NextGen Power Inc., and Mantra Wind Inc. All inter-company balances and transactions have been eliminated.

Use of Estimates

c) Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to allowance for doubtful accounts, the estimated useful lives and recoverability of long-lived assets, equity component of convertible debt, stock-based compensation, and deferred income tax asset valuation allowances. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected. 

Cash and Cash Equivalents

d) Cash and Cash Equivalents

The Company considers all highly liquid instruments with maturity of three months or less at the time of issuance to be cash equivalents.

Accounts Receivable

e) Accounts Receivable

Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The Company records unbilled receivables for services performed but not billed. Management reviews a customer’s credit history before extending credit. The Company maintains an allowance for doubtful accounts for estimated losses. Estimates of uncollectible amounts are reviewed each period, and changes are recorded in the period in which they become known. Management analyzes the collectability of accounts receivable each period. This review considers the aging of account balances, historical bad debt experience, and changes in customer creditworthiness, current economic trends, customer payment activity and other relevant factors. Should any of these factors change, the estimate made by management may also change. The allowance for doubtful accounts at March 31, 2019 and December 31, 2018 was $514,032 and $502,868, respectively.

Property and Equipment

f) Property and Equipment

Property and equipment are stated at cost. The Company depreciates the cost of property and equipment over their estimated useful lives at the following annual rates:

Automotive	3-5 years straight-line basis
Computer equipment and software	3-7 years straight-line basis
Leasehold improvements	5 years straight-line basis
Office equipment and furniture	5 years straight-line basis
Research equipment	5 years straight-line basis

Goodwill

g) Goodwill

Goodwill was generated through the acquisition of AW Solutions, ADEX and TNS as the total consideration paid exceeded the fair value of the net assets acquired.

The Company tests its goodwill for impairment at least annually on December 31^st and whenever events or circumstances change that indicate impairment may have occurred. A significant amount of judgment is involved in determining if an indicator of impairment has occurred. Such indicators may include, among others: a significant decline in the Company's expected future cash flows; a significant adverse change in legal factors or in the business climate; unanticipated competition; and slower growth rates. Any adverse change in these factors could have a significant impact on the recoverability of goodwill and the Company's consolidated financial results.

The Company tests goodwill by estimating fair value using a Discounted Cash Flow ("DCF") model. The key assumptions used in the DCF model to determine the highest and best use of estimated future cash flows include revenue growth rates and profit margins based on internal forecasts, terminal value and an estimate of a market participant's weighted-average cost of capital used to discount future cash flows to their present value. There were no impairment charges during the three months ended March 31, 2019.

Intangible Assets

h) Intangible Assets

At March 31, 2019 and December 31, 2018, definite-lived intangible assets primarily consist of non-compete agreements, tradenames and customer relationships which are being amortized over their estimated useful lives ranging from 3-20 years.

The Company periodically evaluates the reasonableness of the useful lives of these assets. Once these assets are fully amortized, they are removed from the accounts. These assets are reviewed for impairment or obsolescence when events or changes in circumstances indicate that the carrying amount may not be recoverable. If impaired, intangible assets are written down to fair value based on discounted cash flows or other valuation techniques. The Company has no intangibles with indefinite lives.

For long-lived assets, impairment losses are only recorded if the asset’s carrying amount is not recoverable through its undiscounted, probability-weighted future cash flows. The Company measures the impairment loss based on the difference between the carrying amount and the estimated fair value. When an impairment exists, the related assets are written down to fair value.

Long-lived Assets

i) Long-lived Assets

In accordance with ASC 360, “Property, Plant and Equipment”, the Company tests long-lived assets or asset groups for recoverability when events or changes in circumstances indicate that their carrying amount may not be recoverable. Circumstances which could trigger a review include, but are not limited to: significant decreases in the market price of the asset; significant adverse changes in the business climate or legal factors; accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of the asset; current period cash flow or operating losses combined with a history of losses or a forecast of continuing losses associated with the use of the asset; and current expectation that the asset will more likely than not be sold or disposed significantly before the end of its estimated useful life. Recoverability is assessed based on the carrying amount of the asset and its fair value, which is generally determined based on the sum of the undiscounted cash flows expected to result from the use and the eventual disposal of the asset, as well as specific appraisal in certain instances. An impairment loss is recognized when the carrying amount is not recoverable and exceeds fair value. There were no impairment charges recorded during the three months ended March 31, 2019.

Foreign Currency Translation

j) Foreign Currency Translation

Transactions in foreign currencies are translated into the currency of measurement at the exchange rates in effect on the transaction date. Monetary balance sheet items expressed in foreign currencies are translated into U.S. dollars at the exchange rates in effect at the balance sheet date. The resulting exchange gains and losses are recognized in income.

The Company’s integrated foreign subsidiaries are financially or operationally dependent on the Company. The Company uses the temporal method to translate the accounts of its integrated operations into U.S. dollars. Monetary assets and liabilities are translated at the exchange rates in effect at the balance sheet date. Non-monetary assets and liabilities are translated at historical rates. Revenues and expenses are translated at average rates for the period, except for amortization, which is translated on the same basis as the related asset. The resulting exchange gains or losses are recognized in income.

Income Taxes

k) Income Taxes

The Company accounts for income taxes using the asset and liability method in accordance with ASC 740, “Accounting for Income Taxes”. The asset and liability method provides that deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities, and for operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized.

The Company conducts business, and files federal and state income, franchise or net worth, tax returns in Canada, the United States, in various states within the United States and the Commonwealth of Puerto Rico. The Company determines it’s filing obligations in a jurisdiction in accordance with existing statutory and case law. The Company may be subject to a reassessment of federal and provincial income taxes by Canadian tax authorities for a period of three years from the date of the original notice of assessment in respect of any particular taxation year. For Canadian and U.S. income tax returns, the open taxation years range from 2010 to 2018. In certain circumstances, the U.S. federal statute of limitations can reach beyond the standard three year period. U.S. state statutes of limitations for income tax assessment vary from state to state. Tax authorities of Canada and U.S. have not audited any of the Company’s, or its subsidiaries’, income tax returns for the open taxation years noted above.

Significant management judgment is required in determining the provision for income taxes, and in particular, any valuation allowance recorded against the Company’s deferred tax assets. Deferred tax assets are regularly reviewed for recoverability. The Company currently has significant deferred tax assets resulting from net operating loss carryforwards and deductible temporary differences, which should reduce taxable income in future periods. The realization of these assets is dependent on generating future taxable income.

The Company follows the guidance set forth within ASC Topic 740, “Income Taxes” (“ASC Topic 740”) which prescribes a two-step process for the financial statement recognition and measurement of income tax positions taken or expected to be taken in an income tax return. The first step evaluates an income tax position in order to determine whether it is more likely than not that the position will be sustained upon examination, based on the technical merits of the position. The second step measures the benefit to be recognized in the financial statements for those income tax positions that meet the more likely than not recognition threshold. ASC Topic 740 also provides guidance on de-recognition, classification, recognition and classification of interest and penalties, accounting in interim periods, disclosure and transition. Penalties and interest, if incurred, would be recorded as a component of current income tax expense.

The Company received a tax notice from the Puerto Rican government requesting payment of taxes related to 2014 in the amount of $156,711 plus penalties and interest of $111,200 for a total obligation due of $267,911. This tax assessment is included in accrued expenses at March 31, 2019.

Revenue Recognition

l) Revenue Recognition

Revenue from Contracts with Customers

Adoption of New Accounting Guidance on Revenue Recognition

On May 28, 2014, FASB issues Topic 606. As of January 1, 2018, the Company adopted Topic 606 using the modified retrospective approach applied to any contracts that were not completed as of January 1, 2018. Results for reporting periods beginning after January 1, 2018 are presented under the new guidance, while prior periods continue to be reported in accordance with previous accounting guidance. The Company determined that no cumulative effect adjustment to accumulated deficit was necessary upon adoption as there were no significant revenue recognition differences identified between the new and previous accounting guidance.

The Company recognizes revenue based on the five criteria for revenue recognition established under Topic 606: 1) identify the contract, 2) identify separate performance obligations, 3) determine the transaction price, 4) allocate the transaction price among the performance obligations, and 5) recognize revenue as the performance obligations are satisfied.

Contract Types

The Company's contracts fall under three main types: 1) unit-price, 2) fixed-price, and 3) time-and-materials. Unit-price contracts relate to services being performed and paid on a unit basis, such as per mile of construction completed. Fixed-price contracts are based on purchase order line items that are billed on individual invoices as the project progresses and milestones are reached. Time-and-materials contracts include employees working permanently at customer locations and materials costs incurred by those employees.

A significant portion of the Company's revenues come from customers with whom the Company has a master service agreement ("MSA"). These MSA's generally contain customer specific service requirements.

Performance Obligations

A performance obligation is a promise in a contract to transfer a distinct good or service to the customer, and is the unit of account in the new revenue standard. The contract transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. For the Company's different revenue service types the performance obligation is satisfied at different times. For professional services revenue, the performance obligation is met when the work is performed. In certain cases this may be each day, or each week depending on the customer. For construction services, the performance obligation is met when the work is completed and the customer has approved the work. Contract assets include unbilled amounts for services performed but not yet billed. These amounts are included in accounts receivable on the consolidated balance sheets. Contract liabilities include unbilled costs and are included in accrued expenses on the consolidated balance sheets.

Revenue Service Types

The following is a description of the Company's revenue service types, which include professional services and construction:

● Professional services are services provided to the clients where the company delivers distinct contractual deliverables and/or services. Deliverables may include but are not be limited to: engineering drawings, designs, reports and specification. Services may include, but are not be limited to: consulting or professional staffing to support our client's objectives. Consulting or professional staffing services may be provided remotely or on client premises and under their direction and supervision.

● Construction Services are services provided to the client where the Company may self-perform or subcontract services that require the physical construction of infrastructure or installation of equipment and materials.

Disaggregation of Revenues

The Company disaggregates its revenue from contracts with customers by service type, contract type, contract duration, and timing of transfer of goods or services. See the below tables:

Revenue by service type	Three Months Ended March 31, 2019 $		Three Months Ended March 31, 2018 $
Professional services		5,935,226		3,366,569
Construction		5,400,506		961,195
Total		11,335,732		4,327,764

Revenue by contract duration	Three Months Ended March 31, 2019 $		Three Months Ended March 31, 2018 $
Short-term		65,430		43,278
Long-term		11,270,302		4,284,486
Total		11,335,732		4,327,764

Revenue by contract type	Three Months Ended March 31, 2019 $		Three Months Ended March 31, 2018 $
Unit-price		3,238,658		710,362
Fixed-price		2,161,848		250,833
Time-and-materials		5,935,226		3,366,569
Total		11,335,732		4,327,764

The Company also disaggregates its revenue by geographic location and operating segment (See Note 13).

Accounts Receivable

Accounts receivable include amounts from work completed in which the Company has billed. The amounts due are stated at their net estimated realizable value. The Company maintains an allowance for doubtful accounts to provide for the estimated amount of receivables that will not be collected. The allowance is based upon an assessment of customer creditworthiness, historical payment experience, the age of outstanding receivables and collateral to the extent applicable.

Contract Assets and Liabilities

Contract assets include unbilled amounts for services performed but not yet billed. These amounts are included in contract assets on the consolidated balance sheets. The Company records unbilled receivables for services performed but not billed. At March 31, 2019 and December 31, 2018, unbilled receivables totaled $2,227,195 and $1,861,895, respectively.

Contract liabilities include unbilled costs and are included in accrued expenses on the consolidated balance sheets.

Cost of Revenues

m) Cost of Revenues

Cost of revenues includes all direct costs of providing services under our contracts, including costs for direct labor provided by employees, services by independent subcontractors, operation of capital equipment (excluding depreciation and amortization), direct materials, insurance claims and other direct costs.

Research and Development Costs

n) Research and Development Costs

Research and development costs are expensed as incurred.

Stock-based Compensation

o) Stock-based Compensation

The Company records stock-based compensation in accordance with ASC 718, “Compensation – Stock Compensation”, using the fair value method. All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable.

The Company applies ASC 505-50, “Equity-Based Payments to Non-Employees” with respect to options and warrants issued to non-employees which requires the use of option valuation models to measure the fair value of the options and warrants at the measurement date.

The Company uses the Black-Scholes option pricing model to calculate the fair value of stock-based awards. This model is affected by the Company’s stock price as well as assumptions regarding a number of subjective variables. These subjective variables include, but are not limited to, the Company’s expected stock price volatility over the term of the awards, and actual and projected employee stock option exercise behaviors. The value of the portion of the award that is ultimately expected to vest is recognized as an expense in the consolidated statement of operations over the requisite service period.

Loss Per Share

p) Loss Per Share

The Company computes earnings (loss) per share in accordance with ASC 260, “Earnings per Share” which requires presentation of both basic and diluted earnings (loss) per share (“EPS”) on the face of the income statement. Basic EPS is computed by dividing the loss available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive. As of March 31, 2019, the Company had 29,135,606 (March 31, 2018 – 6,177,776) common stock equivalents outstanding.

Comprehensive Loss

q) Comprehensive Loss

ASC 220, “Comprehensive Income,” establishes standards for the reporting and display of comprehensive loss and its components in the financial statements. As at December 31, 2018 and 2017 the Company has no items that represent a comprehensive loss and, therefore, has not included a schedule of comprehensive loss in the consolidated financial statements.

Leases

r) Leases

The Company adopted FASB Accounting Standards Codification, Topic 842, Leases ("ASC 842") electing the practical expedient that allows the Company not to restate its comparative periods prior to the adoption of the standard on January 1, 2019. As such, the disclosures required under ASC 842 are not presented for periods before the date of adoption. For the comparative periods prior to adoption, the Company presented the disclosures which were required under ASC 840.

The new leasing standard requires recognition of leases on the consolidated balance sheets as right-of-use ("ROU") assets and lease liabilities. ROU assets represent the Company's right to use underlying assets for the lease terms and lease liabilities represent the Company's obligation to make lease payments arising from the leases. Operating lease ROU assets and operating lease liabilities are recognized based on the present value and future minimum lease payments over the lease term at commencement date. As the Company's leases do not provide an implicit rate, the Company uses its estimated incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.

The Company recognized lease liabilities, with corresponding ROU assets, based on the present value of unpaid lease payments for existing operating leases longer than twelve months as of January 1, 2019. The ROU assets were adjusted per ASC 842 transition guidance for existing lease-related balances of accrued and prepaid rent, unamortized lease incentives provided by lessors, and restructuring liabilities, Operating lease cost is recognized as a single lease cost on a straight-line basis over the lease term and is recorded in selling, general and administrative expenses. Variable lease payments for common area maintenance, property taxes and other operating expenses are recognized as expense in the period when the changes in facts and circumstances on which the variable lease payments are based occur.

Recent Accounting Pronouncements

s) Recent Accounting Pronouncements

On January 1, 2018, we adopted the new accounting standard ASC 606, Revenue from Contracts with Customers, and all of the related amendments ("new revenue standard") as discussed in Revenue Recognition accounting policy description.

In February 2016, the FASB issued ASU 2016-02, Leases ("ASU 2016-02"), which, among other things, requires an entity to recognize a right-of-use asset and a lease liability on the balance sheet for substantially all leases, including operating leases. Expanded disclosures with additional qualitative and quantitative information are also required. ASU 2016-02 and its amendments are effective for interim and annual reporting periods beginning after December 15, 2018 and early adoption was permitted.

The Company adopted ASU 2016-02 and its amendments and applied the transition provisions as of January 1, 2019, which included recognizing a cumulative-effect adjustment through opening retained earnings as of that date. Prior year amounts were not recast under this transition approach and, therefore, prior year amounts are excluded from the leased properties footnote. The Company elected the package of practical expedients permitted under the transition guidance, which allowed the Company to carryforward its historical assessments of: (1) whether contracts are or contain leases, (2) lease classification and (3) initial direct costs. In addition, the Company did not elect the hindsight practical expedient to determine the reasonably certain lease term for existing leases. The Company elected a policy of not recording leases on its condensed consolidated balance sheets when the leases have a term of 12 months or less and the Company is not reasonably certain to elect an option to purchase the leased asset. The Company recognizes payments on these leases within selling, administrative and other expenses on a straight-line basis over the lease term. The standard did not materially impact consolidated net income or liquidity.

The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or result of operations

Concentrations of Risk

t) Concentrations of Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and accounts receivables. The Company maintains its cash balances with high-credit-quality financial institutions. Deposits held with banks may exceed the amount of insurance provided on such deposits. These deposits may be withdrawn upon demand and therefore bear minimal risk.

The Company provides credit to customers on an uncollateralized basis after evaluating client creditworthiness. For the three months ended March 31, 2019, four customers accounted for 30%, 18%, 10% and 10%, respectively, of consolidated revenues for the period. In addition, amounts due from these customers represented 30%, 20%, 7% and 5%, respectively, of trade accounts receivable as of March 31, 2019. For the three months ended March 31, 2018, two customers accounted for 22% and 18%, respectively, of consolidated revenues for the period.

The Company's customers are primarily located within the domestic United States of America and Puerto Rico. Revenues generated within the domestic United States of America accounted for approximately 97% of consolidated revenues for the three month period ended March 31, 2019 (89% - 2018). Revenues generated from customers in Puerto Rico accounted for approximately 3% of consolidated revenues for the three month period ended March 31, 2019 (11% - 2018).

Fair Value Measurements

u) Fair Value Measurements

The Company measures and discloses the estimated fair value of financial assets and liabilities using the fair value hierarchy prescribed by US generally accepted accounting principles. The fair value hierarchy has three levels, which are based on reliable available inputs of observable data. The hierarchy requires the use of observable market data when available. The three-level hierarchy is defined as follows:

Level 1 – quoted prices for identical instruments in active markets.

Level 2 – quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model derived valuations in which significant inputs and significant value drivers are observable in active markets; and.

Level 3 – fair value measurements derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

Financial instruments consist principally of cash and cash equivalents, accounts receivable, restricted cash, accounts payable, loans payable and convertible debentures. Derivative liabilities are determined based on “Level 3” inputs, which are significant and unobservable and have the lowest priority. There were no transfers into or out of “Level 3” during the three months ended March 31, 2019 and 2018. The recorded values of all other financial instruments approximate their current fair values because of their nature and respective relatively short maturity dates or durations.

Our financial assets and liabilities carried at fair value measured on a recurring basis as of December 31, 2018 and December 31, 2017, consisted of the following:

	Total fair value at March 31, 2019 $		Quoted prices in active markets (Level 1) $		Significant other observable inputs (Level 2) $		Significant unobservable inputs (Level 3) $
Description:
Derivative liability (1)		2,874,674		–		–		2,874,674

	Total fair value at December 31, 2018 $		Quoted prices in active markets (Level 1) $		Significant other observable inputs (Level 2) $		Significant unobservable inputs (Level 3) $
Description:
Derivative liability (1)		3,166,886		–		–		3,166,886

(1) The Company has estimated the fair value of these derivatives using the Monte-Carlo model and/or a Binomial Model.

Fair value estimates are made at a specific point in time, based on relevant market information and information about the financial statement. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimates. See Note 9 for additional information.

Derivative Liabilities

v) Derivative Liabilities

The Company accounts for derivative instruments in accordance with ASC Topic 815, "Derivatives and Hedging" and all derivative instruments are reflected as either assets or liabilities at fair value in the balance sheet. The Company uses estimates of fair value to value its derivative instruments. Fair value is defined as the price to sell an asset or transfer a liability in an orderly transaction between willing and able market participants. In general, the Company's policy in estimating fair values is to first look at observable market prices for identical assets and liabilities in active markets, where available. When these are not available, other inputs are used to model fair value such as prices of similar instruments, yield curves, volatilities, prepayment speeds, default rates and credit spreads, relying first on observable data from active markets. Depending on the availability of observable inputs and prices, different valuation models could produce materially different fair value estimates. The values presented may not represent future fair values and may not be realizable. The Company categorizes its fair value estimates in accordance with ASC 820 based on the hierarchical framework associated with the three levels of price transparency utilized in measuring financial instruments at fair value as discussed above. As of March 31, 2019, and December 31, 2018, the Company had a $2,784,674 and $3,166,886 derivative liability, respectively.

Sequencing Policy

w) Sequencing Policy

Under ASC 815-40-35, the Company has adopted a sequencing policy whereby, in the event that reclassification of contracts from equity to assets or liabilities is necessary pursuant to ASC 815 due to the Company’s inability to demonstrate it has sufficient authorized shares as a result of certain securities with a potentially indeterminable number of shares, shares will be allocated on the basis of the earliest issuance date of potentially dilutive instruments, with the earliest grants receiving the first allocation of shares. Pursuant to ASC 815, issuance of securities to the Company’s employees or directors are not subject to the sequencing policy.

Reclassifications

x) Reclassifications

Certain balances in previously issued consolidated financial statements have been reclassified to be consistent with the current period presentation. The reclassification had no impact on total financial position, net income, or stockholders’ equity.

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Significant Accounting Policies (Tables)

3 Months Ended

Mar. 31, 2019

Accounting Policies [Abstract]

Schedule of property and equipment estimated useful lives

Automotive	3-5 years straight-line basis
Computer equipment and software	3-7 years straight-line basis
Leasehold improvements	5 years straight-line basis
Office equipment and furniture	5 years straight-line basis
Research equipment	5 years straight-line basis

Schedule of disaggregates its revenue from contracts with customers by service type

Revenue by service type	Three Months Ended March 31, 2019 $		Three Months Ended March 31, 2018 $
Professional services		5,935,226		3,366,569
Construction		5,400,506		961,195
Total		11,335,732		4,327,764

Revenue by contract duration	Three Months Ended March 31, 2019 $		Three Months Ended March 31, 2018 $
Short-term		65,430		43,278
Long-term		11,270,302		4,284,486
Total		11,335,732		4,327,764

Revenue by contract type	Three Months Ended March 31, 2019 $		Three Months Ended March 31, 2018 $
Unit-price		3,238,658		710,362
Fixed-price		2,161,848		250,833
Time-and-materials		5,935,226		3,366,569
Total		11,335,732		4,327,764

Schedule of financial assets and liabilities fair value measured on a recurring basis

	Total fair value at March 31, 2019 $		Quoted prices in active markets (Level 1) $		Significant other observable inputs (Level 2) $		Significant unobservable inputs (Level 3) $
Description:
Derivative liability (1)		2,874,674		–		–		2,874,674

	Total fair value at December 31, 2018 $		Quoted prices in active markets (Level 1) $		Significant other observable inputs (Level 2) $		Significant unobservable inputs (Level 3) $
Description:
Derivative liability (1)		3,166,886		–		–		3,166,886

(1) The Company has estimated the fair value of these derivatives using the Monte-Carlo model and/or a Binomial Model.

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Acquisition of TNS, Inc. (Tables)

3 Months Ended

Mar. 31, 2019

Business Combinations [Abstract]

Schedule of allocation of preliminary purchase price

Provisional Purchase Consideration
$620,000 Convertible Note	$	665,000
Cash		980,000
Total Purchase Price	$	1,645,000
Preliminary Allocation of Purchase Price
Cash	$	38,407
Accounts receivable, net		65,166
Prepaid expenses		630,810
Customer lists *		1,800,000
Tradenames *		300,000
Goodwill *		670,759
Accounts payable		(275,331	)
Accrued expenses		(611,778	)
Contract liabilities		(973,033	)
Net assets acquired	$	1,645,000

* The Company is reviewing for potential identifiable intangible assets, which may potentially change the value allocated to intangible assets.

Schedule of unaudited pro forma consolidated of operations

	March 31, 2019 $						March 31, 2018 $
	As Reported			Pro Forma			As Reported		Pro Forma
Net Sales		11,335,732			11,335,732			4,327,764		8,259,398
Net Loss		(1,332,587	)		(1,340,141	)		134,269		1,243,947
Earnings per common share:
Basic		(0.11	)		(0.11	)		0.06		0.56
Diluted		(0.11	)		(0.11	)		0.03		0.16

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Property and Equipment (Tables)

3 Months Ended

Mar. 31, 2019

Property, Plant and Equipment [Abstract]

Schedule of property and equipment

	March 31, 2019 $			December 31, 2018 $
Computers and office equipment		331,987			329,937
Equipment		382,140			382,140
Research equipment		143,129			143,129
Software		227,563			177,073
Vehicles		94,356			94,356
Vehicles under capital lease		–			–
Total		1,179,175			1,126,635
Less: impairment		(44,419	)		(44,419	)
Less: accumulated depreciation		(1,027,977	)		(1,020,959	)
Equipment, Net		106,779			61,257

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Intangible Assets (Tables)

3 Months Ended

Mar. 31, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of intangible assets

	Cost $		Accumulated amortization $		Impairment $		March 31, 2019 Net carrying value $		December 31, 2018 Net carrying value $
Customer relationship and lists		2,837,548		249,121		–		2,588,427		850,249
Trade names		1,505,605		143,922		–		1,361,683		1,086,795
		4,343,153		393,043		–		3,950,110		1,937,044

Schedule of estimated future amortization expense

	$
For year ending December 31, 2019		260,453
For year ending December 31, 2020		347,387
For year ending December 31, 2021		347,387
For year ending December 31, 2022		347,387
For year ending December 31, 2023 to December 31, 2027		2,647,496
Total		3,950,110

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Related Party Transactions (Tables)

3 Months Ended

Mar. 31, 2019

Related Party Transactions [Abstract]

Schedule of related party transactions

	March 31, 2019		December 31, 2018
Promissory note issued to Roger Ponder, 10% interest, unsecured, matured on November 30, 2018 and extended to November 30, 2019	$	18,858	$	18,858
Promissory note issued to Keith Hayter, 10% interest, unsecured, matured on November 30, 2018 and extended to November 30, 2019		130,000		130,000
Promissory note issued to Keith Hayter, 8% interest, unsecured, matures April 10, 2019		85,000		85,000
Promissory note issued to Keith Hayter, 8% interest, unsecured, matures August 20, 2019		80,000		80,000
Total	$	313,858	$	313,858

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Loans Payable (Tables)

3 Months Ended

Mar. 31, 2019

Debt Disclosure [Abstract]

Schedule of loans payable

	March 31, 2019		December 31, 2018
Promissory note issued to J. Thacker, non-interest bearing, unsecured and due on demand	$	41,361	$	41,361
Promissory note issued to S. Kahn, non-interest bearing, unsecured and due on demand	$	7,760	$	7,760
Promissory note issued to 0738856 BC Ltd, non-interest bearing, unsecured and due on demand		15,000		15,000
Promissory note issued to Bluekey Energy, non-interest bearing, unsecured and due on demand		7,500		7,500
Promissory note issued to 0738856 BC ltd non-interest bearing, unsecured and due on demand		2,636		2,636
Subscription amount due to T. Warkentin non-interest bearing, unsecured and due on demand		50,000		50,000
Promissory note issued to Old Main Capital LLC, 8% interest, unsecured and due on demand		12,000		12,000
Promissory note issued to InterCloud Systems, Inc., non-interest bearing, unsecured and due on demand		275,000		275,000
Loan with Heritage Bank of Commerce, interest rate of prime plus 2%, secured by all assets of the Company, matures October 20, 2020, net of debt discount of $149,180 and $257,194		4,397,521		3,225,821
Loan with WaveTech Global, Inc., interest rate of 12%,  matured April 28, 2019		1,325,895		-
Total	$	6,134,673	$	3,637,078

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Convertible Debentures (Tables)

3 Months Ended

Mar. 31, 2019

Convertible Debentures Tables Abstract

Schedule of convertible promissory note

	March 31, 2019		December 31, 2018
Convertible promissory note, InterCloud Systems, Inc,, 8% interest, unsecured, matured April 27, 2018, net of debt discount of $0 and $361,333	$	1,445,625	$	1,735,000
Convertible promissory note, InterCloud Systems, Inc,, 6% interest, unsecured, matured March 27, 2019, net of debt discount of $160,782 and $286,749		1,596,542		1,565,681
Convertible promissory note, InterCloud Systems, Inc,, 1% interest, unsecured, matures August 16, 2019, net of debt discount of $109,036 and $171,557		684,858		622,392
Convertible promissory note, Barn 11, 6% interest, unsecured, matures June 1, 2019, net of debt discount of $0 and $45,000		500,000		445,000
Convertible promissory note, Dominion Capital, 18% interest, secured, matures October 23,2019, net of debt discount of $879,130 and $1,009,630		239,291		240,370
Convertible promissory note, Dominion Capital, 12% interest, unsecured, matures May 18, 2019, net of debt discount of $82,787 and $172,570		212,959		123,176
Convertible promissory note, M2B Funding, 12% interest, unsecured, matures March 15, 2019, net of debt discount of $0 and $9,087		-		69,860
Convertible promissory note, M2B Funding, 12% interest, unsecured, matures March 15, 2019, net of debt discount of $0 and $41,395		-		37,552
Convertible promissory note, Silverback, 8% interest, unsecured, matures December 4, 2019, net of debt discount of $21,656 and $24,140		5,844		3,360
Convertible promissory note, Michael Roeske, 6% interest, unsecured, matures, January 30, 2020, net of debt discount of $30,189 and $0		85,844		-
Convertible promissory note, Joel Raven, 6% interest, unsecured, matures January 30, 2020, net of debt discount of $77,155 and $0		286,845		-
Convertible promissory note, Virtual Capital, LLC, 0% interest, unsecured, matured, January 24, 2019		125,000
Convertible promissory note, RDW Capital LLC, 9.9% interest, unsecured, matured March 30, 2019, net of debt discount of $0 and $0		5,750		-
Total	$	5,188,558	$	4,842,391

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Derivative Liabilities (Tables)

3 Months Ended

Mar. 31, 2019

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of changes in the fair value of the Company's Level 3 financial liabilities

	March 31, 2019			December 31, 2018
Balance at the beginning of period	$	3,166,886		$	4,749,712
Derivative issued as part of acquisition		-			302,800
Original discount limited to proceeds of notes		189,000			2,839,369
Fair value of derivative liabilities in excess of notes proceeds received		-			2,274,892
Derivative warrants issued for services and to acquire non-controlling interest		-			328,833
Derivative liability settled through the issuance of preferred stock		-			(291,064	)
Conversion of derivative liability		(686,135	)		(678,142	)
Repayment of convertible note		(164,468	)		(310,041	)
Change in fair value of embedded conversion option		369,391			(6,049,473	)
Balance at the end of the period	$	2,874,674		$	3,166,886

Schedule of assumptions used in the calculations

	Expected Volatility			Risk-free Interest Rate			Expected Dividend Yield			Expected Life (in years)
At issuance		204	%		2.57	%		0	%		1.07
At December 31, 2018		172-381	%		2.45-2.63	%		0	%		0.04-2.78
At March 31, 2019		215-386	%		2.27-2.44	%		0	%		0.25-2.53

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Share Purchase Warrants (Tables)

3 Months Ended

Mar. 31, 2019

Warrants and Rights Note Disclosure [Abstract]

Schedule of share purchase warrants

	Number of warrants			Weighted average exercise price $
Balance, December 31, 2018		1,715,177			2.14
Issued		284,717			1.20
Expired		(60,000	)		0.32
Balance, March 31, 2019		1,939,894			1.96

Schedule of share purchase warrants outstanding

Number of warrants			Exercise price $		Expiry date
	20,375			74.00	April 10, 2019
	137,500			5.10	April 28, 2020
	250,000			0.10	June 27, 2020
	593,064	*		1.20	February 13, 2021
	125,000			1.60	February 21, 2021
	500,000			1.00	May 17, 2020
	200,000			0.00010	September 10, 2019
	113,955			1.08	October 10, 2021
	1,939,894

* This warrant is convertible into 4% of the number of common shares of the Company outstanding. At March 31, 2019, 4% of the number of shares of the Company outstanding was 14,826,590 shares.

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Leases (Tables)

3 Months Ended

Mar. 31, 2019

Leases [Abstract]

Schedule of operating leases related to assets and liabilities

	March 31, 2019
Operating lease assets	$	232,325
Operating lease liabilities:
Current operating lease liabilities	$	233,191
Total operating lease liabilities	$	233,191

Schedule of weighted-average discount rate

	March 31, 2019
2019	$	173,727
2020		88,431
2021		61,372
2022		63,214
2023		21,330
2024		-
Total lease payments		408,074
Less: imputed interest		(174,883	)
Total operating lease liabilities	$	233,191

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Segment Disclosures (Tables)

3 Months Ended

Mar. 31, 2019

Segment Reporting [Abstract]

Schedule of information by operating segment

	Spectrum Global $			AWS/ADEX/TNS $		Total $
Net Sales		–			11,335,732		11,335,732
Operating (loss) income		(954,967	)		969,666		14,699
Interest expense		399,555			71,857		471,412
Depreciation and amortization		-			93,952		93,952
Total Assets as of March 31, 2019		15,067			18,021,819		18,036,886

	Spectrum Global $			AWS/ADEX $			Total $
Net Sales		–			4,327,764			4,327,764
Operating (loss) income		(666,249	)		(77,242	)		(743,491	)
Interest expense		107,894			71,431			179,325
Depreciation and amortization		–			47,833			47,833
Total Assets as of December 31, 2018		99,835			12,830,561			10,774,123

Schedule of geographic information

	Revenues $		Long-Lived Assets $
Puerto Rico		310,478		3,371
United States		11,025,254		6,817,755
Consolidated Total		11,335,732		6,821,126

	Revenues $		Long-Lived Assets $
Puerto Rico		466,624		5,377
United States		3,861,140		4,016,895
Consolidated Total		4,327,764		4,022,273

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Net (Loss) Income Per Share (Tables)

3 Months Ended

Mar. 31, 2019

Net Loss Income Per Share [Abstract]

Schedule of net loss income per share

	Three Months			Three Months
	Ended			Ended
	March 31,			March 31,
	2019			2018
	$			$
Numerator:
Net income (loss)		(1,332,587	)		134,269
Convertible note interest		–			87,860
Adjusted diluted net income (loss)		(1,332,587	)		222,129
Denominator:
Weighted average shares outstanding used in computing net income per share:
Basic		11,771,927			2,225,809
Effect of dilutive stock options and convertible notes payable		–			6,194,355
Effect of preferred shares		–			8,842
Diluted		11,771,927			8,429,006
Net income (loss) per share applicable to common stockholders:
Basic		(0.11	)		0.06
Diluted		(0.11	)		0.03

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Organization and Going Concern (Details) - USD ($)	Mar. 31, 2019	Dec. 31, 2018	Feb. 14, 2018	Apr. 25, 2017
Organization and Significant Accounting Policies (Textual)
Accumulated deficit	$ (25,502,692)	$ (24,170,105)
Working capital deficit	$ (11,242,041)
Inter Cloud [Member]
Organization and Significant Accounting Policies (Textual)
Business acquisition, percentage			19.90%
Financial Support, Purchase Agreement of Financial Assets [Member] | Inter Cloud [Member]
Organization and Significant Accounting Policies (Textual)
Business acquisition, percentage				80.10%

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Significant Accounting Policies (Details)	3 Months Ended
	Mar. 31, 2019
Automotive [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, useful lives	3 years
Automotive [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, useful lives	5 years
Computer equipment and software [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, useful lives	3 years
Computer equipment and software [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, useful lives	7 years
Leasehold improvements [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, useful lives	5 years
Office equipment and furniture [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, useful lives	5 years
Research equipment [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, useful lives	5 years

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Significant Accounting Policies (Details 1) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Revenues	$ 11,335,732	$ 4,327,764
Revenue by service type [Member]
Revenue by service type
Professional services	5,935,226	3,366,569
Construction	5,400,506	961,195
Revenue by contract duration [Member]
Revenue by contract duration
Short-term Debt	65,430	43,278
Long-term Debt	11,270,302	4,284,486
Unit-price [Member]
Revenues	3,238,658	710,362
Fixed-price [Member]
Revenues	2,161,848	250,833
Time-and-materials [Member]
Revenues	$ 5,935,226	$ 3,366,569

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Significant Accounting Policies (Details 2) - USD ($)		Mar. 31, 2019	Dec. 31, 2018
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liability	[1]	$ 2,784,674	$ 3,166,886
Quoted prices in active markets (Level 1) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liability	[1]
Significant other observable inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liability	[1]
Significant unobservable inputs (Level 3) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liability	[1]	$ 2,874,674	$ 3,166,886

[1] The Company has estimated the fair value of these derivatives using the Monte-Carlo model and/or a Binomial Model.

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Significant Accounting Policies (Details Textual) - USD ($)		3 Months Ended		12 Months Ended
		Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
Organization and Significant Accounting Policies (Textual)
Unbilled receivables		$ 2,227,195		$ 1,861,895
Definite-lived intangible assets useful lives		3 years		20 years
Allowance for doubtful accounts		$ 514,032		$ 502,868
Dilutive potential shares outstanding		29,135,606		6,177,776
Derivative liability	[1]	$ 2,784,674		$ 3,166,886
Income taxes, description		A tax notice from the Puerto Rican government requesting payment of taxes related to 2014 in the amount of $156,711 plus penalties and interest of $111,200 for a total obligation due of $267,911.
Revenues [Member] | United States [Member]
Organization and Significant Accounting Policies (Textual)
Customers risk, percentage		97.00%	89.00%
Revenues [Member] | Puerto Rico [Member]
Organization and Significant Accounting Policies (Textual)
Customers risk, percentage		3.00%	11.00%
Revenues [Member] | Customer One [Member]
Organization and Significant Accounting Policies (Textual)
Customers risk, percentage		30.00%	22.00%
Revenues [Member] | Customer Two [Member]
Organization and Significant Accounting Policies (Textual)
Customers risk, percentage		18.00%	18.00%
Revenues [Member] | Customer Three [Member]
Organization and Significant Accounting Policies (Textual)
Customers risk, percentage		10.00%
Revenues [Member] | Customer Four [Member]
Organization and Significant Accounting Policies (Textual)
Customers risk, percentage		10.00%
Accounts receivable [Member] | Customer One [Member]
Organization and Significant Accounting Policies (Textual)
Customers risk, percentage		30.00%
Accounts receivable [Member] | Customer Two [Member]
Organization and Significant Accounting Policies (Textual)
Customers risk, percentage		20.00%
Accounts receivable [Member] | Customer Three [Member]
Organization and Significant Accounting Policies (Textual)
Customers risk, percentage		7.00%
Accounts receivable [Member] | Customer Four [Member]
Organization and Significant Accounting Policies (Textual)
Customers risk, percentage		5.00%

[1] The Company has estimated the fair value of these derivatives using the Monte-Carlo model and/or a Binomial Model.

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Acquisition of TNS, Inc. (Details) - USD ($)		Jan. 04, 2019	Mar. 31, 2019	Dec. 31, 2018
Preliminary Allocation of Purchase Price
Goodwill			$ 2,505,615	$ 1,834,856
Acquisition-related Costs [Member]
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
$620,000 Convertible Note		$ 665,000
Cash		980,000
Total Purchase Price		1,645,000
Preliminary Allocation of Purchase Price
Cash		38,407
Accounts receivable, net		65,166
Prepaid expenses		630,810
Customer lists	[1]	1,800,000
Tradenames	[1]	300,000
Goodwill	[1]	670,759
Accounts payable		(275,331)
Accrued expenses		(611,778)
Contract liabilities		(973,033)
Net assets acquired		$ 1,645,000

[1] The Company is reviewing for potential identifiable intangible assets, which may potentially change the value allocated to intangible assets.

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Acquisition of TNS, Inc. (Details 1) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Business Combination, Separately Recognized Transactions [Line Items]
Net Sales	$ 11,335,732	$ 4,327,764
Net Loss	$ (1,332,587)	$ 134,269
Basic	$ (0.11)	$ 0.06
Diluted	$ (0.11)	$ 0.03
Pro Forma [Member]
Business Combination, Separately Recognized Transactions [Line Items]
Net Sales	$ 11,335,732	$ 8,259,398
Net Loss	$ (1,340,141)	$ 1,243,947
Basic	$ (0.11)	$ 0.56
Diluted	$ (0.11)	$ 0.16

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Acquisition of TNS, Inc. (Details Textual) - USD ($)	Jan. 04, 2019	Mar. 31, 2019	Dec. 31, 2018
TNS Acquisition (Textual)
Aggregate principal amount	$ 620,000
Business acquisition, description	The purchase price paid by the Company for the includes $980,000 in cash, paid at closing, and the issuance to InterCloud of a convertible promissory note in the aggregate principal amount of $620,000 (the "Note").
Convertible note	$ 620,000	$ 5,188,558	$ 4,842,391

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Property and Equipment (Details) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Property, Plant and Equipment [Line Items]
Total	$ 1,179,175	$ 1,126,635
Less: impairment	(44,419)	(44,419)
Less: accumulated depreciation	(1,027,977)	(1,020,959)
Equipment, Net	106,779	61,257
Computers and office equipment [Member]
Property, Plant and Equipment [Line Items]
Total	331,987	329,937
Equipment [Member]
Property, Plant and Equipment [Line Items]
Total	382,140	382,140
Research equipment [Member]
Property, Plant and Equipment [Line Items]
Total	143,129	143,129
Software [Member]
Property, Plant and Equipment [Line Items]
Total	227,563	177,073
Vehicles [Member]
Property, Plant and Equipment [Line Items]
Total	94,356	94,356
Vehicles under capital lease [Member]
Property, Plant and Equipment [Line Items]
Total

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Property and Equipment (Details Textual) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Property and Equipment (Textual)
Depreciation expense	$ 7,018	$ 4,395

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Intangible Assets (Details) - USD ($)	3 Months Ended
	Mar. 31, 2019	Dec. 31, 2018
Finite-Lived Intangible Assets [Line Items]
Cost	$ 2,588,427	$ 850,249
Accumulated amortization	1,361,683	$ 1,086,795
Net carrying value	3,950,110
Trade names [Member]
Finite-Lived Intangible Assets [Line Items]
Cost	1,505,605
Accumulated amortization	143,922
Impairment
Customer relationship and lists [Member]
Finite-Lived Intangible Assets [Line Items]
Cost	2,837,548
Accumulated amortization	249,121
Impairment

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Intangible Assets (Details 1)	Mar. 31, 2019 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
For year ending December 31, 2019	$ 260,453
For year ending December 31, 2020	347,387
For year ending December 31, 2021	347,387
For year ending December 31, 2022	347,387
For year ending December 31, 2023 to December 31, 2027	2,647,496
Total	$ 3,950,110

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Intangible Assets (Details Textual) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Intangible Assets (Textual)
Amortization expense	$ 86,934	$ 43,438

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Related Party Transactions (Details) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Total	$ 313,858	$ 313,858
Promissory note issued to Roger Ponder [Member]
Total	18,858	18,858
Promissory note issued to Keith Hayter [Member]
Total	130,000	130,000
Promissory note issued to Keith Hayter One [Member]
Total	85,000	85,000
Promissory note issued to Keith Hayter Two [Member]
Total	$ 80,000	$ 80,000

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Related Party Transactions (Details Textual) - USD ($)					1 Months Ended		3 Months Ended		12 Months Ended
	Jun. 01, 2018	Jun. 01, 2018	Apr. 13, 2018	Nov. 30, 2017	Aug. 21, 2018	Apr. 23, 2018	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
Related Party Transactions (Textual)
Gain loss on settlement of debt							$ 164,467	$ 561,963
Series B Preferred Stock [Member]
Related Party Transactions (Textual)
Fair value of Series B Preferred Stock						$ 484,530
Inter Cloud [Member]
Related Party Transactions (Textual)
Due to related parties							50,577		$ 51,889
Contingent liability									0
Principal amount									793,894
President [Member]
Related Party Transactions (Textual)
Proceeds from issuance of promissory notes				$ 130,000			$ 80,000		80,000
Bearing interest rate, per annum				8.00%
Due date				Nov. 30, 2018
Base compensation		$ 340,000
Chief Executive Officer [Member]
Related Party Transactions (Textual)
Proceeds from issuance of promissory notes				$ 18,858
Bearing interest rate, per annum				8.00%
Due date				Nov. 30, 2018
Base compensation	$ 350,000
President One [Member]
Related Party Transactions (Textual)
Proceeds from issuance of promissory notes			$ 85,000						$ 85,000
Bearing interest rate, per annum			8.00%						8.00%
Due date			Apr. 13, 2019						Apr. 20, 2020
Ponder [Member] | Series B Preferred Stock [Member]
Related Party Transactions (Textual)
Common stock exchanged, shares						542,500
Common stock aggregate, shares						500
Hayter [Member] | Series B Preferred Stock [Member]
Related Party Transactions (Textual)
Common stock exchanged, shares						542,500
Common stock aggregate, shares						500
President Two [Member]
Related Party Transactions (Textual)
Proceeds from issuance of promissory notes					$ 80,000
Bearing interest rate, per annum					8.00%
Due date					Aug. 20, 2019

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Loans Payable (Details) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Loans payable	$ 6,134,673	$ 3,637,078
Promissory note issued to J. Thacker [Member]
Loans payable	41,361	41,361
Promissory note issued to S. Kahn [Member]
Loans payable	7,760	7,760
Promissory note issued to 0738856 BC Ltd [Member]
Loans payable	15,000	15,000
Promissory note issued to Bluekey Energy [Member]
Loans payable	7,500	7,500
Promissory note issued to 0738856 BC ltd [Member]
Loans payable	2,636	2,636
Subscription amount due to T. Warkentin [Member]
Loans payable	50,000	50,000
Promissory note issued to Old Main Capital LLC [Member]
Loans payable	12,000	12,000
Promissory note issued to InterCloud Systems, Inc [Member]
Loans payable	275,000	275,000
Loan with Heritage Bank of Commerce [Member]
Loans payable	4,397,521	3,225,821
Loan with WaveTech Global, Inc [Member]
Loans payable	$ 1,325,895

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Loans Payable (Details Textual) - USD ($)	3 Months Ended	12 Months Ended
	Mar. 31, 2019	Dec. 31, 2018	Aug. 04, 2015	Mar. 31, 2012
Common stock subscribed	$ 74,742	$ 74,742
Commercial Paper [Member]
Promissory note			$ 50,000
Loans Payable [Member]
Owed to a non-related party	$ 49,121	49,121
Common stock subscribed				$ 50,000
Common stock share subscriptions				10,000,000
Description of loan payable	The Company owed $3,483,015 pursuant to this agreement and will record accretion equal to the debt discount of $257,194 over the remaining term of the note. At during the three months ended March 31, 2019 the Company borrowed an additional $1,063,686 and recorded accretion of $108,014. At March 31, 2019, the Company owed $4,546,701 pursuant to this agreement and will record accretion equal to the debt discount of $149,180 over the remaining term of the note.
Accrued interest	$ 1,200	1,200
Loans Payable [Member] | Canada, Dollars
Owed to a non-related party	63,300	63,300
Loans Payable One [Member]
Owed to a non-related party	15,000	15,000
Loans Payable Two [Member]
Owed to a non-related party	7,500	7,500
Loans Payable Two [Member] | Non Related Party [Member]
Owed to a non-related party	2,636	2,636
Loans Payable Two [Member] | Canada, Dollars
Owed to a non-related party	$ 3,400	$ 3,400

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Convertible Debentures (Details) - USD ($)	Mar. 31, 2019	Jan. 04, 2019	Dec. 31, 2018
Convertible promissory note	$ 5,188,558	$ 620,000	$ 4,842,391
InterCloud Systems, Inc [Member]
Convertible promissory note	1,445,625		1,735,000
InterCloud Systems, Inc [Member]
Convertible promissory note	1,596,542		1,565,681
InterCloud Systems, Inc [Member]
Convertible promissory note	684,858		622,392
Barn [Member]
Convertible promissory note	500,000		445,000
Dominion Capital [Member]
Convertible promissory note	239,291		240,370
Dominion Capital [Member]
Convertible promissory note	212,959		123,176
M2B Funding [Member]
Convertible promissory note			69,860
M2B Funding [Member]
Convertible promissory note			37,552
Silverback [Member]
Convertible promissory note	5,844		3,360
Michael Roeske [Member]
Convertible promissory note	85,844
Joel Raven [Member]
Convertible promissory note	286,845
Virtual Capital, LLC [Member]
Convertible promissory note	125,000
RDW Capital LLC [Member]
Convertible promissory note	$ 5,750

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Convertible Debentures (Details Textual) - USD ($)						1 Months Ended												3 Months Ended			6 Months Ended	12 Months Ended
	Jan. 04, 2019	Mar. 12, 2018	Feb. 21, 2018	Dec. 04, 2015	Sep. 08, 2015	Mar. 15, 2019	Jan. 28, 2019	Jan. 24, 2019	Sep. 26, 2018	Jun. 07, 2018	May 18, 2018	Feb. 27, 2018	Feb. 21, 2018	Jun. 27, 2017	May 31, 2017	Apr. 28, 2017	Apr. 27, 2017	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2017	Dec. 31, 2017	Dec. 31, 2018	May 31, 2017	May 31, 2016	Dec. 03, 2018	Apr. 23, 2018	Feb. 06, 2018	Dec. 15, 2017	Feb. 04, 2014	Dec. 27, 2013
Convertible Debentures (Textual)
Notes payable											$ 280,959
Accretion expense																		$ 661,352	$ 654,087
Proceeds from issuance of convertible debentures																			500,000
Accrued interest																											$ 32,560
Derivative And Hedging [Member]
Convertible Debentures (Textual)
Accretion expense																						$ 349,785
Carrying value of the note																						218,206
Convertible Promissory Notes [Member]
Convertible Debentures (Textual)
Accretion expense																		$ 125,967	89,783
Carrying value of the note																			$ 212,959
Aggregate principal amount																	$ 2,000,000
Issued shares of common stock																		617,600
Common stock upon the conversion value																		$ 49,995
Fair value of the conversion feature																		1,174,000
Debt instrument, interest rate terms, description																	The interest on the outstanding principal due under the Unsecured Note accrues at a rate of 8% per annum. All principal and accrued interest under the Unsecured Note is due one year following the issue date of the Unsecured Note and is convertible into shares of common stock at a conversion price equal to 75% of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion.
Other remaining debenture value																		45,077
Description of convertible debentures						The holder of the convertible promissory note described in Note 8(a) entered into agreements to sell and assign a total of $200,000, of the outstanding principal to a third party. During the three months ended March 31, 2019, $75,000 and $7,499 of the note was converted into 1,071,418 shares of common stock. At March 31, 2019, the carrying value of the notes was $25,000.		The holder of the convertible promissory note described in Note 8(a) entered into agreements to sell and assign a total of $200,000, of the outstanding principal to a third party. During the three months ended March 31, 2019, $75,000 and $7,499 of the note was converted into 1,071,418 shares of common stock. At March 31, 2019, the carrying value of the notes was $25,000.		The holder of the convertible promissory note described in Note 8(a) entered into agreements to sell and assign a total of $39,375, of the outstanding principal to a third party. During the three months ended March 31, 2019, $39,375 of the note was converted into 576,501 shares of common stock. At March 31, 2019, the carrying value of the notes was $Nil.		The Company issued a convertible promissory note in the aggregate principal amount of $2,000,000. The interest on the outstanding principal due under the ADEX Note accrues at a rate of 6% per annum. All principal and accrued interest under the ADEX Note is due one year following the issue date of the ADEX Note and is convertible into shares of common stock at a conversion price equal to of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion, but in no event ever lower than $1 (the "Floor"), unless the note is in default, at which time the Floor terminates.	The holder of the convertible promissory note described in Note 8(a) entered into agreements to sell and assign a total of $105,000, of the outstanding principal to a third party. During the year ended December 31, 2018, $55,000 of the note was converted. During the three months ended March 31, 2019, $44,250 of the note was converted into 583,156 shares of common stock. At March 31, 2019, the carrying value of the notes was $5,750.				The initial fair value of the conversion feature of $1,174,000 resulted in a discount to the note payable of $943,299. On December 15, 2017, February 14, 2018, February 21, 2018, June 7, 2018, January 24, 2019, and March 15, 2019 the holder of the convertible promissory note entered into agreement to sell and assign a total of $105,000, $105,000, $105,000, $39,375, $100,000 and $100,000 of the outstanding principal, respectively to a third party. The Company approved and is bound by the assignment and sale agreement. As a result of the assignment, the conversion price for the total of $354,375 of notes assigned is now equal to the lesser 70% of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion and $8. The Company accounted for this assignment in accordance with ASC 470-50 "Modifications and Extinguishments". In accordance with ASC 470-50, the Company accounted for the assignment as a debt extinguishment and adjusted the fair value of the derivative to its fair value on the assignment date. During the year ended December 31, 2018, the entire December 15, 2017 note of $105,000, the entire February 14, 2018 note of $105,000 and $55,000 of the February 21, 2018 $105,000 note was converted into 661,795 shares of common stock. The February 21, 2018, June 7, 2018, notes are described in Notes 8(b), and (c) respectively. The January 24, 2019 and March 15, 2019 assignments are described in Note 8(d). At March 31, 2019, the carrying value of the notes was $1,445,625,
Convertible Promissory Notes [Member] | Derivative And Hedging [Member]
Convertible Debentures (Textual)
Notes payable																										$ 1,500,000
Accretion expense															$ 54,526					$ 173,031		569,317
Carrying value of the note															54,526					$ 194,557		240,370
Issued shares of common stock		10,560,000
Common stock upon the conversion value		$ 33,000
Fair value of the conversion feature																										$ 3,325,000
Debt instrument, interest rate terms, description											The Company issues any common stock or common stock equivalents at an effective price per share less than $1 then the conversion price of the note will be reduced to the lower price. As long as the note is not in default the Company may repay the note at 110% of the outstanding principal amount. If the Company defaults upon the note it bears interest at 18% per annum.
Convertible Promissory Notes [Member] | Derivative And Hedging [Member] | Series A Preferred Stock [Member]
Convertible Debentures (Textual)
Debenture note																											374,000
Convertible Promissory Notes [Member] | Third Party [Member]
Convertible Debentures (Textual)
Accretion expense																						352,251
Carrying value of the note																						$ 352,251
Aggregate principal amount																									$ 50,000
Issued shares of common stock																						321,500
Common stock upon the conversion value																						$ 74,993
Debt instrument, interest rate terms, description									The conversion price for the $75,000 of notes assigned is now equal to the lesser 75% of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion and $8.
Convertible Note One [Member] | Derivative And Hedging [Member]
Convertible Debentures (Textual)
Notes payable																						348,000
Accretion expense																						62,466
Carrying value of the note																						$ 684,858
Aggregate principal amount			$ 500,000										$ 500,000
Issued shares of common stock			25,000,000										25,000,000									125,000
Fair value of the conversion feature																						$ 348,000
Debt instrument, interest rate			6.00%										6.00%
Exercise price			$ 1.60										$ 1.60
Debt instrument, interest rate terms, description			The exercise price of the warrant will reduce to 85% of the closing price of the Company's common stock if the closing price of the Company's common stock is less than $1.60 on July 31, 2018. The note is due on January 15, 2019, and bears interest at 6% per annum. The note is convertible into common shares of the Company at a conversion price equal to the lower of 80% of the lowest volume-weighted average price during the 5 trading days immediately preceding the date of conversion and $1
Convertible Debentures Seven [Member]
Convertible Debentures (Textual)
Notes payable				$ 95,000
Carrying value of the note																							$ 131,250	$ 48,690
Debt instrument, interest rate terms, description				The note bears interest at 10% per annum and is convertible into common shares of the Company at a 52% discount to the lowest trading price during the previous 30 trading days to the date of conversion; or a 52% discount to the lowest trading price during the previous 30 trading days before the date the note was executed.
Loss on derivatives				$ 111,108
Convertible Debentures Six [Member]
Convertible Debentures (Textual)
Notes payable																		144,000
Fair value of the conversion feature																		$ 189,000
Debt instrument, interest rate terms, description	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 Company 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.						The holder of the convertible promissory note entered into agreement to sell and assign a total of $620,000 of the $620,000 outstanding principal to two third parties. The Company approved and is bound by the assignment and sale agreement. During the three months ended March 31, 2019, $140,000 of the note was converted into 1,400,000 shares of common. During the three months ended March 31, 2019, the Company recorded accretion of $36,656 increasing the carrying value of the notes to $372,656.																	The note bears interest at 10% per annum and is convertible into common shares of the Company at a 65% discount to the lowest trading price during the previous 20 trading days to the date of conversion; or a 65% discount to the lowest trading price during the previous 20 trading days before the date the note was executed.
Loss on derivatives					$ 204,626
Convertible Promissory Note [Member]
Convertible Debentures (Textual)
Notes payable																						943,299
Carrying value of the note																						$ 1,545,625
Issued shares of common stock																						661,795
Convertible Promissory Note [Member] | Derivatives [Member]
Convertible Debentures (Textual)
Accretion expense															54,526						$ 173,031
Carrying value of the note															$ 54,526						$ 194,557
Issued shares of common stock		52,800																										59,400
Common stock upon the conversion value		$ 33,000
Fair value of the conversion feature																												$ 33,000,000
Accrued interest		$ 2,640
Convertible Promissory Note [Member] | Derivatives [Member] | Series A Preferred Stock [Member]
Convertible Debentures (Textual)
Debenture note																											$ 374,000
Convertible Promissory Note [Member] | Unsecured Debt [Member]
Convertible Debentures (Textual)
Aggregate principal amount																	$ 2,000,000
Debt instrument, interest rate																	8.00%
Debt instrument, interest rate terms, description																						The lesser 70% of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion and $8.
Commercial Paper [Member]
Convertible Debentures (Textual)
Due date of issuance														3 years
Convertible Debentures Nine [Member]
Convertible Debentures (Textual)
Debt instrument, interest rate terms, description												The Company issued a convertible promissory note in the aggregate principal amount of $2,000,000. The interest on the outstanding principal due under the ADEX Note accrues at a rate of 6% per annum. All principal and accrued interest under the ADEX Note is due one year following the issue date of the ADEX Note and is convertible into shares of common stock at a conversion price equal to of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion, but in no event ever lower than $1 (the ?Floor?), unless the note is in default, at which time the Floor terminates.				The interest on the outstanding principal due under the Unsecured Note accrues at a rate of 8% per annum. All principal and accrued interest under the Unsecured Note is due one year following the issue date of the Unsecured Note and is convertible into shares of common stock at a conversion price equal to 75% of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion.
Convertible Note [Member] | Derivative And Hedging [Member]
Convertible Debentures (Textual)
Notes payable																						$ 639,000
Aggregate principal amount																						$ 793,894
Debt instrument, interest rate terms, description																						The note is due on August 16, 2019 and bears interest at 1% per annum. The note is convertible into common shares of the Company at a conversion price equal to the 80% of the lowest volume-weighted average price during the 5 trading days immediately preceding the date of conversion.
Fair value of the warrants																						$ 2,455,000
Convertible Debentures Five [Member]
Convertible Debentures (Textual)
Loss on derivatives																							210,266
Conversion price																							$ 90,000	$ 45,000
Convertible Debentures Eight [Member]
Convertible Debentures (Textual)
Notes payable																								81,666
Carrying value of the note																								$ 40,432
Debt instrument, interest rate terms, description																								he note bears interest at 10% per annum and is convertible into common shares of the Company at a 65% discount to the lowest trading price during the previous 20 trading days to the date of conversion; or a 65% discount to the lowest trading price during the previous 20 trading days before the date the note was executed.
Loss on derivatives																								$ 158,785
Convertible Debentures Four [Member]
Convertible Debentures (Textual)
Debenture note																													$ 15,000
Convertible Debentures Two [Member]
Convertible Debentures (Textual)
Debenture note																														$ 5,000

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Convertible Debentures (Details Textual 2) - USD ($)				1 Months Ended			3 Months Ended		7 Months Ended	12 Months Ended
	Jan. 04, 2019	Dec. 04, 2015	Sep. 08, 2015	Jan. 28, 2019	Feb. 27, 2018	Apr. 28, 2017	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2017	May 31, 2017	May 31, 2016	Dec. 31, 2018
Convertible Debentures (Textual)
Fair value of conversion feature							$ 1,042,253	$ 526,369	$ 168,697
Convertible debentures, net of discount							1,360,735					$ 1,770,073
Accretion expense							661,352	$ 654,087
Convertible Debentures Seven [Member]
Convertible Debentures (Textual)
Debt instrument, interest rate terms, description		The note bears interest at 10% per annum and is convertible into common shares of the Company at a 52% discount to the lowest trading price during the previous 30 trading days to the date of conversion; or a 52% discount to the lowest trading price during the previous 30 trading days before the date the note was executed.
Loss on derivatives		$ 111,108
Convertible debentures, net of discount		$ 10,000
Convertible Debentures Six [Member]
Convertible Debentures (Textual)
Debt instrument, interest rate terms, description	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 Company 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.			The holder of the convertible promissory note entered into agreement to sell and assign a total of $620,000 of the $620,000 outstanding principal to two third parties. The Company approved and is bound by the assignment and sale agreement. During the three months ended March 31, 2019, $140,000 of the note was converted into 1,400,000 shares of common. During the three months ended March 31, 2019, the Company recorded accretion of $36,656 increasing the carrying value of the notes to $372,656.							The note bears interest at 10% per annum and is convertible into common shares of the Company at a 65% discount to the lowest trading price during the previous 20 trading days to the date of conversion; or a 65% discount to the lowest trading price during the previous 20 trading days before the date the note was executed.
Fair value of conversion feature			$ 479,626								$ 280,000
Loss on derivatives			204,626
Convertible debentures, net of discount			$ 280,000								26,087
Convertible debentures carrying value							$ 189,000
Convertible Debentures Nine [Member]
Convertible Debentures (Textual)
Debt instrument, interest rate terms, description					The Company issued a convertible promissory note in the aggregate principal amount of $2,000,000. The interest on the outstanding principal due under the ADEX Note accrues at a rate of 6% per annum. All principal and accrued interest under the ADEX Note is due one year following the issue date of the ADEX Note and is convertible into shares of common stock at a conversion price equal to of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion, but in no event ever lower than $1 (the ?Floor?), unless the note is in default, at which time the Floor terminates.	The interest on the outstanding principal due under the Unsecured Note accrues at a rate of 8% per annum. All principal and accrued interest under the Unsecured Note is due one year following the issue date of the Unsecured Note and is convertible into shares of common stock at a conversion price equal to 75% of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion.
Convertible Debentures Five [Member]
Convertible Debentures (Textual)
Fair value of conversion feature										$ 310,266
Loss on derivatives										210,266
Convertible debentures, net of discount										100,000
Conversion of stock, amount converted										$ 90,000	$ 45,000
Convertible Debentures Eight [Member]
Convertible Debentures (Textual)
Debt instrument, interest rate terms, description											he note bears interest at 10% per annum and is convertible into common shares of the Company at a 65% discount to the lowest trading price during the previous 20 trading days to the date of conversion; or a 65% discount to the lowest trading price during the previous 20 trading days before the date the note was executed.
Loss on derivatives											$ 158,785
Convertible debentures, net of discount											$ 16,666

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Convertible Debentures (Details Textual 3) - USD ($)											1 Months Ended							3 Months Ended			6 Months Ended		12 Months Ended
	Jan. 04, 2019	Mar. 12, 2018	Feb. 21, 2018	Feb. 06, 2018	Feb. 06, 2018	Nov. 16, 2017	Apr. 07, 2017	Oct. 11, 2016	Dec. 04, 2015	Sep. 08, 2015	Jan. 28, 2019	Sep. 26, 2018	May 18, 2018	Feb. 27, 2018	May 31, 2017	Apr. 28, 2017	Apr. 27, 2017	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2017	Dec. 31, 2017	Nov. 16, 2017	Dec. 31, 2018	May 31, 2017	May 31, 2016	Dec. 03, 2018	Apr. 23, 2018	Dec. 15, 2017	Feb. 04, 2014	Dec. 27, 2013
Short-term Debt [Line Items]
Accretion expense																		$ 661,352	$ 654,087
Convertible debentures, net of discount																		1,360,735					$ 1,770,073
Notes payable													$ 280,959
Convertible Debentures Two [Member]
Short-term Debt [Line Items]
Debenture note																														$ 5,000
Convertible Promissory Notes [Member]
Short-term Debt [Line Items]
Convertible note principal amount																	$ 2,000,000
Debt instrument, interest rate terms, description																	The interest on the outstanding principal due under the Unsecured Note accrues at a rate of 8% per annum. All principal and accrued interest under the Unsecured Note is due one year following the issue date of the Unsecured Note and is convertible into shares of common stock at a conversion price equal to 75% of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion.
Accretion expense																		125,967	89,783
Convertible debentures carrying value																		$ 1,174,000
Carrying value of the note																			$ 212,959
Issued shares of common stock																		617,600
Common stock upon the conversion value																		$ 49,995
Convertible Debentures Seven [Member]
Short-term Debt [Line Items]
Debt instrument, interest rate terms, description									The note bears interest at 10% per annum and is convertible into common shares of the Company at a 52% discount to the lowest trading price during the previous 30 trading days to the date of conversion; or a 52% discount to the lowest trading price during the previous 30 trading days before the date the note was executed.
Loss on derivatives									$ 111,108
Convertible debentures, net of discount									10,000
Notes payable									$ 95,000
Carrying value of the note																								$ 131,250	$ 48,690
Debt instrument, fee amount																									$ 26,250
Convertible Promissory Note [Member]
Short-term Debt [Line Items]
Notes payable																							943,299
Carrying value of the note																							$ 1,545,625
Issued shares of common stock																							661,795
Convertible Debentures Eight [Member]
Short-term Debt [Line Items]
Debt instrument, interest rate terms, description																									he note bears interest at 10% per annum and is convertible into common shares of the Company at a 65% discount to the lowest trading price during the previous 20 trading days to the date of conversion; or a 65% discount to the lowest trading price during the previous 20 trading days before the date the note was executed.
Loss on derivatives																									$ 158,785
Convertible debentures, net of discount																									16,666
Notes payable																									81,666
Carrying value of the note																									40,432
Debt instrument, fee amount																									$ 20,417
Convertible Debentures Eight [Member] | Additional Tranches [Member]
Short-term Debt [Line Items]
Accretion expense																						$ 43,692		133,721
Loss on derivatives																								117,788
Convertible debentures carrying value															$ 245,571									245,571
Convertible debentures, net of discount							$ 4,444
Notes payable															127,783									127,783
Carrying value of the note																								206,098
Debt instrument, fee amount															31,946									31,946
Accrued interest						$ 33,359
Additional paid-in capital convertible debentures							$ 40,000
Received additional tranches																								123,339
Convertible Debentures Six [Member]
Short-term Debt [Line Items]
Debt instrument, interest rate terms, description	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 Company 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.										The holder of the convertible promissory note entered into agreement to sell and assign a total of $620,000 of the $620,000 outstanding principal to two third parties. The Company approved and is bound by the assignment and sale agreement. During the three months ended March 31, 2019, $140,000 of the note was converted into 1,400,000 shares of common. During the three months ended March 31, 2019, the Company recorded accretion of $36,656 increasing the carrying value of the notes to $372,656.														The note bears interest at 10% per annum and is convertible into common shares of the Company at a 65% discount to the lowest trading price during the previous 20 trading days to the date of conversion; or a 65% discount to the lowest trading price during the previous 20 trading days before the date the note was executed.
Loss on derivatives										$ 204,626
Convertible debentures carrying value																		189,000
Convertible debentures, net of discount										$ 280,000															$ 26,087
Notes payable																		$ 144,000
Convertible Debentures Five [Member]
Short-term Debt [Line Items]
Loss on derivatives																								210,266
Convertible debentures, net of discount															100,000									100,000
Conversion price																								90,000	$ 45,000
Convertible Debentures Nine [Member]
Short-term Debt [Line Items]
Debt instrument, interest rate terms, description														The Company issued a convertible promissory note in the aggregate principal amount of $2,000,000. The interest on the outstanding principal due under the ADEX Note accrues at a rate of 6% per annum. All principal and accrued interest under the ADEX Note is due one year following the issue date of the ADEX Note and is convertible into shares of common stock at a conversion price equal to of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion, but in no event ever lower than $1 (the ?Floor?), unless the note is in default, at which time the Floor terminates.		The interest on the outstanding principal due under the Unsecured Note accrues at a rate of 8% per annum. All principal and accrued interest under the Unsecured Note is due one year following the issue date of the Unsecured Note and is convertible into shares of common stock at a conversion price equal to 75% of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion.
Convertible Debentures Nine [Member] | Additional Tranches [Member]
Short-term Debt [Line Items]
Convertible note principal amount								$ 42,500
Debt instrument, interest rate terms, description								The note bears interest at 10% per annum and is convertible into common shares of the Company at a 65% discount to the lowest trading price during the previous 20 trading days to the date of conversion; or a 65% discount to the lowest trading price during the previous 20 trading days before the date the note was executed.
Accretion expense																						43,046		26,953
Loss on derivatives								$ 76,902
Convertible debentures carrying value								121,902
Convertible debentures, net of discount								24,999
Notes payable								45,000
Carrying value of the note																								$ 26,953
Debt instrument, fee amount						$ 17,500		$ 2,500														17,500
Convertible Debentures Nine [Member] | Series A Preferred Stock [Member] | Additional Tranches [Member]
Short-term Debt [Line Items]
Accrued interest																						$ 12,288
Convertible Debentures Four [Member]
Short-term Debt [Line Items]
Debenture note																													$ 15,000
Derivative And Hedging [Member]
Short-term Debt [Line Items]
Accretion expense																							$ 349,785
Carrying value of the note																							218,206
Derivative And Hedging [Member] | Convertible Note One [Member]
Short-term Debt [Line Items]
Convertible note principal amount			$ 500,000
Debt instrument, interest rate terms, description			The exercise price of the warrant will reduce to 85% of the closing price of the Company's common stock if the closing price of the Company's common stock is less than $1.60 on July 31, 2018. The note is due on January 15, 2019, and bears interest at 6% per annum. The note is convertible into common shares of the Company at a conversion price equal to the lower of 80% of the lowest volume-weighted average price during the 5 trading days immediately preceding the date of conversion and $1
Accretion expense																							62,466
Convertible debentures carrying value																							348,000
Notes payable																							348,000
Carrying value of the note																							$ 684,858
Issued shares of common stock			25,000,000																				125,000
Debt instrument, interest rate			6.00%
Exercise price			$ 1.60
Derivative And Hedging [Member] | Convertible Promissory Notes [Member]
Short-term Debt [Line Items]
Debt instrument, interest rate terms, description													The Company issues any common stock or common stock equivalents at an effective price per share less than $1 then the conversion price of the note will be reduced to the lower price. As long as the note is not in default the Company may repay the note at 110% of the outstanding principal amount. If the Company defaults upon the note it bears interest at 18% per annum.
Accretion expense															54,526					$ 173,031			$ 569,317
Convertible debentures carrying value																											$ 3,325,000
Notes payable																											$ 1,500,000
Carrying value of the note															54,526					$ 194,557			240,370
Accrued interest		$ 2,640
Issued shares of common stock		10,560,000
Common stock upon the conversion value		$ 33,000
Derivative And Hedging [Member] | Convertible Promissory Notes [Member] | Series A Preferred Stock [Member]
Short-term Debt [Line Items]
Accrued interest					$ 32,560
Debenture note				$ 374,000	374,000
Derivative And Hedging [Member] | Convertible Note [Member]
Short-term Debt [Line Items]
Convertible note principal amount																							$ 793,894
Debt instrument, interest rate terms, description																							The note is due on August 16, 2019 and bears interest at 1% per annum. The note is convertible into common shares of the Company at a conversion price equal to the 80% of the lowest volume-weighted average price during the 5 trading days immediately preceding the date of conversion.
Notes payable																							$ 639,000
Fair value of the warrants																							2,455,000
Derivatives [Member] | Convertible Promissory Note [Member]
Short-term Debt [Line Items]
Accretion expense															54,526						$ 173,031
Convertible debentures carrying value																												$ 33,000,000
Carrying value of the note															$ 54,526						$ 194,557
Accrued interest		$ 2,640
Issued shares of common stock		52,800																										59,400
Common stock upon the conversion value		$ 33,000
Derivatives [Member] | Convertible Promissory Note [Member] | Series A Preferred Stock [Member]
Short-term Debt [Line Items]
Accrued interest				32,560
Debenture note				$ 374,000	$ 374,000
Third Party [Member] | Convertible Promissory Notes [Member]
Short-term Debt [Line Items]
Convertible note principal amount																										$ 50,000
Debt instrument, interest rate terms, description												The conversion price for the $75,000 of notes assigned is now equal to the lesser 75% of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion and $8.
Accretion expense																							352,251
Carrying value of the note																							$ 352,251
Issued shares of common stock																							321,500
Common stock upon the conversion value																							$ 74,993
Unsecured Debt [Member] | Convertible Promissory Note [Member]
Short-term Debt [Line Items]
Convertible note principal amount																	$ 2,000,000
Debt instrument, interest rate terms, description																							The lesser 70% of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion and $8.
Debt instrument, interest rate																	8.00%

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Convertible Debentures (Details Textual 4) - USD ($)														1 Months Ended										3 Months Ended			6 Months Ended	12 Months Ended
		Jan. 04, 2019	Dec. 04, 2018	Oct. 10, 2018	Jul. 03, 2018	May 18, 2018	May 03, 2018	Mar. 12, 2018	Feb. 21, 2018	Feb. 06, 2018	Feb. 06, 2018	Dec. 04, 2015	Sep. 08, 2015	Jan. 28, 2019	Sep. 26, 2018	Jul. 31, 2018	May 24, 2018	May 18, 2018	Apr. 23, 2018	Feb. 27, 2018	May 31, 2017	Apr. 28, 2017	Apr. 27, 2017	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2017	Dec. 31, 2017	Dec. 31, 2018	May 31, 2017	May 31, 2016	Dec. 03, 2018	May 02, 2018	Apr. 16, 2018	Dec. 15, 2017	Feb. 04, 2014	Dec. 27, 2013
Convertible Debentures (Textual)
Notes payable						$ 280,959												$ 280,959
Accretion expense																								$ 661,352	$ 654,087
Secured note accrues interest rate						12.00%												12.00%	12.00%
Percentage of repayment note						110.00%													110.00%
Bears interest						18.00%												18.00%	18.00%
Derivative expenses	[1]																							2,784,674				$ 3,166,886
Common stock fixed conversion price						$ 1
Cash prepayment premium						5.00%
Other prepayment premium						10.00%
Gain on extinguishment of debt																								164,467	561,963
Securities Purchase Agreement One [Member]
Convertible Debentures (Textual)
Accretion expense																									2,484
Carrying value of the note																									2,484
Issued shares of common stock						29,156												29,156														27,188
Aggregate principal amount																																$ 78,947
Common Stock [Member]
Convertible Debentures (Textual)
Gain on extinguishment of debt							$ 13,432										$ 15,386
Warrant [Member]
Convertible Debentures (Textual)
Fair value of the warrants				$ 87,410
Series A Preferred Stock [Member]
Convertible Debentures (Textual)
Shares, issued						496,101												496,101
Gain on extinguishment of debt											$ 538,359
Series B Preferred Stock [Member]
Convertible Debentures (Textual)
Shares, issued																																	1,000
Senior Secured Convertible Promissory Note [Member] | Securities Purchase Agreement One [Member]
Convertible Debentures (Textual)
Fair value of the conversion feature			$ 30,000
Notes payable			25,000
Accretion expense																												37,554
Carrying value of the note																												37,554
Aggregate principal amount			$ 27,500
Debt instrument, interest rate terms, description			The interest on the outstanding principal due under the secured note accrues at a rate of 8% per annum. All principal and accrued but unpaid interest under the secured note is due on December 4, 2019. The secured note is convertible into shares of the Company's at The Company may repay the note at 150% of the outstanding principal amount. If the Company defaults upon the note it bears interest at 18% per annum.
Aggregate purchase price			$ 25,000
Derivative expenses			$ 5,000
Convertible Promissory Notes [Member]
Convertible Debentures (Textual)
Fair value of the conversion feature																								1,174,000
Accretion expense																								125,967	89,783
Carrying value of the note																									212,959
Common stock upon the conversion value																								$ 49,995
Issued shares of common stock																								617,600
Aggregate principal amount																							$ 2,000,000
Debt instrument, interest rate terms, description																							The interest on the outstanding principal due under the Unsecured Note accrues at a rate of 8% per annum. All principal and accrued interest under the Unsecured Note is due one year following the issue date of the Unsecured Note and is convertible into shares of common stock at a conversion price equal to 75% of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion.
Derivative expenses																												187,041
Convertible Promissory Notes [Member] | Securities Purchase Agreement One [Member]
Convertible Debentures (Textual)
Fair value of the conversion feature					$ 23,000											$ 103,000
Notes payable					23,000											75,000
Loss on derivatives																												202,000
Accretion expense					8,135											17,554												17,860
Carrying value of the note					60,135											$ 17,554												69,860
Aggregate principal amount					$ 78,947	$ 295,746												$ 295,746	$ 1,578,947									78,947
Debt instrument, interest rate terms, description					The interest on the outstanding principal due under the secured note accrues at a rate of 12% per annum. All principal and accrued but unpaid interest under the secured note is due on March 15, 2019. The secured note is convertible into shares of the Company's at the greater of $0.80 or 75% of the lowest VWAP in the 10 trading days prior to conversion.The Company may repay the note at 115% of the outstanding principal amount. If the Company defaults upon the note it bears interest at 18% per annum.											The interest on the outstanding principal due under the secured note accrues at a rate of 12% per annum. All principal and accrued but unpaid interest under the secured note is due on March 15, 2019. The secured note is convertible into shares of the Company's at the greater of $1 or 75% of the lowest VWAP in the 10 trading days prior to conversion.The Company may repay the note at 115% of the outstanding principal amount. If the Company defaults upon the note it bears interest at 18% per annum.
Aggregate purchase price					$ 75,000	$ 280,959										$ 75,000			1,500,000
Secured note accrues interest rate					12.00%											12.00%
Secured note, due date					Mar. 15, 2019											Mar. 15, 2019
Percentage of repayment note					115.00%											115.00%
Bears interest					18.00%											18.00%
Derivative expenses																$ 28,000
Debenture holders to settle convertible debenture					$ 2,300											$ 90,000												131,579
Convertible Debentures Seven [Member]
Convertible Debentures (Textual)
Notes payable												$ 95,000
Loss on derivatives												$ 111,108
Carrying value of the note																													$ 131,250	$ 48,690
Debt instrument, interest rate terms, description												The note bears interest at 10% per annum and is convertible into common shares of the Company at a 52% discount to the lowest trading price during the previous 30 trading days to the date of conversion; or a 52% discount to the lowest trading price during the previous 30 trading days before the date the note was executed.
Convertible Promissory Note [Member]
Convertible Debentures (Textual)
Notes payable																												943,299
Carrying value of the note																												$ 1,545,625
Issued shares of common stock																												661,795
Convertible Debentures Six [Member]
Convertible Debentures (Textual)
Fair value of the conversion feature																								$ 189,000
Notes payable																								$ 144,000
Loss on derivatives													$ 204,626
Debt instrument, interest rate terms, description		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 Company 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.												The holder of the convertible promissory note entered into agreement to sell and assign a total of $620,000 of the $620,000 outstanding principal to two third parties. The Company approved and is bound by the assignment and sale agreement. During the three months ended March 31, 2019, $140,000 of the note was converted into 1,400,000 shares of common. During the three months ended March 31, 2019, the Company recorded accretion of $36,656 increasing the carrying value of the notes to $372,656.																The note bears interest at 10% per annum and is convertible into common shares of the Company at a 65% discount to the lowest trading price during the previous 20 trading days to the date of conversion; or a 65% discount to the lowest trading price during the previous 20 trading days before the date the note was executed.
Convertible Debentures Five [Member]
Convertible Debentures (Textual)
Loss on derivatives																													$ 210,266
Convertible Debentures Nine [Member]
Convertible Debentures (Textual)
Debt instrument, interest rate terms, description																				The Company issued a convertible promissory note in the aggregate principal amount of $2,000,000. The interest on the outstanding principal due under the ADEX Note accrues at a rate of 6% per annum. All principal and accrued interest under the ADEX Note is due one year following the issue date of the ADEX Note and is convertible into shares of common stock at a conversion price equal to of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion, but in no event ever lower than $1 (the ?Floor?), unless the note is in default, at which time the Floor terminates.		The interest on the outstanding principal due under the Unsecured Note accrues at a rate of 8% per annum. All principal and accrued interest under the Unsecured Note is due one year following the issue date of the Unsecured Note and is convertible into shares of common stock at a conversion price equal to 75% of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion.
Convertible Debentures Eight [Member]
Convertible Debentures (Textual)
Notes payable																														$ 81,666
Loss on derivatives																														158,785
Carrying value of the note																														$ 40,432
Debt instrument, interest rate terms, description																														he note bears interest at 10% per annum and is convertible into common shares of the Company at a 65% discount to the lowest trading price during the previous 20 trading days to the date of conversion; or a 65% discount to the lowest trading price during the previous 20 trading days before the date the note was executed.
Convertible Debentures Four [Member]
Convertible Debentures (Textual)
Debenture note																																			$ 15,000
Convertible Debentures Two [Member]
Convertible Debentures (Textual)
Debenture note																																				$ 5,000
Derivative And Hedging [Member]
Convertible Debentures (Textual)
Accretion expense																												$ 349,785
Carrying value of the note																												218,206
Increasing the carrying value																												70,585
Derivative And Hedging [Member] | Warrant [Member]
Convertible Debentures (Textual)
Fair value of the conversion feature																												571,079
Fair value of the warrants																												158,772
Notes payable																												500,000
Loss on derivatives																												229,851
Accretion expense																												55,000
Carrying value of the note																									$ 500,000
Derivative And Hedging [Member] | Convertible Note One [Member]
Convertible Debentures (Textual)
Fair value of the conversion feature																												348,000
Notes payable																												348,000
Accretion expense																												62,466
Carrying value of the note																												$ 684,858
Issued shares of common stock									25,000,000																			125,000
Aggregate principal amount									$ 500,000
Debt instrument, interest rate terms, description									The exercise price of the warrant will reduce to 85% of the closing price of the Company's common stock if the closing price of the Company's common stock is less than $1.60 on July 31, 2018. The note is due on January 15, 2019, and bears interest at 6% per annum. The note is convertible into common shares of the Company at a conversion price equal to the lower of 80% of the lowest volume-weighted average price during the 5 trading days immediately preceding the date of conversion and $1
Interest rate									6.00%
Exercise price									$ 1.60
Increasing the carrying value																												$ 142,719
Derivative And Hedging [Member] | Convertible Promissory Notes [Member]
Convertible Debentures (Textual)
Fair value of the conversion feature																			3,325,000
Notes payable																			1,500,000
Accretion expense																					$ 54,526					$ 173,031		569,317
Carrying value of the note																					54,526					$ 194,557		240,370
Common stock upon the conversion value								$ 33,000
Issued shares of common stock								10,560,000
Accrued interest								$ 2,640
Debt instrument, interest rate terms, description																		The Company issues any common stock or common stock equivalents at an effective price per share less than $1 then the conversion price of the note will be reduced to the lower price. As long as the note is not in default the Company may repay the note at 110% of the outstanding principal amount. If the Company defaults upon the note it bears interest at 18% per annum.
Derivative expenses																			1,825,000
Repayment of convertible note																			328,947
Gain on extinguishment of debt																			$ 305,001
Derivative And Hedging [Member] | Convertible Promissory Notes [Member] | Series A Preferred Stock [Member]
Convertible Debentures (Textual)
Accrued interest											32,560
Debenture note										$ 374,000	374,000
Derivative And Hedging [Member] | Convertible Note [Member]
Convertible Debentures (Textual)
Fair value of the warrants																												2,455,000
Notes payable																												639,000
Aggregate principal amount																												$ 793,894
Debt instrument, interest rate terms, description																												The note is due on August 16, 2019 and bears interest at 1% per annum. The note is convertible into common shares of the Company at a conversion price equal to the 80% of the lowest volume-weighted average price during the 5 trading days immediately preceding the date of conversion.
Contingent liability																												$ 793,893
Derivatives [Member] | Convertible Promissory Note [Member]
Convertible Debentures (Textual)
Fair value of the conversion feature																																		$ 33,000,000
Accretion expense																					54,526						$ 173,031
Carrying value of the note																					$ 54,526						$ 194,557
Common stock upon the conversion value								$ 33,000
Issued shares of common stock								52,800																										59,400
Accrued interest								$ 2,640
Derivatives [Member] | Convertible Promissory Note [Member] | Series A Preferred Stock [Member]
Convertible Debentures (Textual)
Accrued interest										32,560
Debenture note										$ 374,000	$ 374,000
Third Party [Member] | Convertible Promissory Notes [Member]
Convertible Debentures (Textual)
Accretion expense																												352,251
Carrying value of the note																												352,251
Common stock upon the conversion value																												$ 74,993
Issued shares of common stock																												321,500
Aggregate principal amount																															$ 50,000
Debt instrument, interest rate terms, description															The conversion price for the $75,000 of notes assigned is now equal to the lesser 75% of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion and $8.
Unsecured Debt [Member] | Convertible Promissory Note [Member]
Convertible Debentures (Textual)
Aggregate principal amount																							$ 2,000,000
Debt instrument, interest rate terms, description																												The lesser 70% of the lowest volume-weighted average price during the 15 trading days immediately preceding the date of conversion and $8.
Interest rate																							8.00%

[1] The Company has estimated the fair value of these derivatives using the Monte-Carlo model and/or a Binomial Model.

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Derivative Liabilities (Details) - USD ($)	3 Months Ended		12 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
Derivative [Line Items]
Original discount limited to proceeds of notes	$ 20,000	$ 402,500
fair value of Level 3 [Member]
Derivative [Line Items]
Balance at the beginning of period	3,166,886
Derivative issued as part of acquisition			$ 302,800
Original discount limited to proceeds of notes	189,000		2,839,369
Fair value of derivative liabilities in excess of notes proceeds received			2,274,892
Derivative warrants issued for services and to acquire non-controlling interest			328,833
Derivative liability settled through the issuance of preferred stock			(291,064)
Conversion of derivative liability	(686,135)		(678,142)
Repayment of convertible note	(164,468)		(310,041)
Change in fair value of embedded conversion option	369,391		(6,049,473)
Balance at the end of the period	$ 2,874,674		$ 3,166,886

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Derivative Liabilities (Details 1) - Issuance [Member]	3 Months Ended	12 Months Ended
	Mar. 31, 2019	Dec. 31, 2018
Derivative [Line Items]
Expected Volatility		20400.00%
Risk-free Interest Rate		257.00%
Expected Dividend Yield	0.00%	0.00%
Expected Life (in years)		1 year 26 days
Minimum [Member]
Derivative [Line Items]
Expected Volatility	21500.00%
Risk-free Interest Rate	227.00%
Expected Life (in years)	2 months 30 days
Maximum [Member]
Derivative [Line Items]
Expected Volatility	38600.00%
Risk-free Interest Rate	244.00%
Minimum [Member]
Derivative [Line Items]
Expected Volatility		17200.00%
Risk-free Interest Rate		245.00%
Expected Life (in years)		15 days
Maximum [Member]
Derivative [Line Items]
Expected Volatility		38100.00%
Risk-free Interest Rate		263.00%
Expected Life (in years)		2 years 9 months 11 days

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Common Stock (Details) - USD ($)						1 Months Ended						3 Months Ended		7 Months Ended	12 Months Ended
	Feb. 01, 2019	Jan. 14, 2019	Oct. 09, 2018	May 03, 2018	Feb. 06, 2018	Jan. 28, 2019	Sep. 28, 2018	Jun. 02, 2018	May 24, 2018	May 18, 2018	May 31, 2017	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2017	Dec. 31, 2018	Oct. 01, 2018	Nov. 15, 2017
Common Stock (Textual)
Common stock price												$ 0.00001			$ 0.00001
Common stock, shares authorized												750,000,000			750,000,000
Common stock, shares issued										19,945
Common share converted by holder										66,113
Gain (loss) on extinguishment of debt												$ 164,467	$ 561,963
Treasury stock, shares															621,258
Treasury stock, cost															$ 277,436
Series A Preferred Stock [Member]
Common Stock (Textual)
Preferred stock, shares authorized												8,000,000			8,000,000
Common stock, shares issued								13,622
Common share converted by holder								17,078
Gain (loss) on extinguishment of debt					$ 538,359
Common stock,cancelled shares																82,963
Series B Preferred Stock [Member]
Common Stock (Textual)
Preferred stock, shares authorized												1,000			1,000
Common Stock [Member]
Common Stock (Textual)
Common stock, shares issued	2,869,230	110,742		27,778		2,000,000			20,833
Common stock, amount						$ 15,552
Gain (loss) on extinguishment of debt				$ 13,432					$ 15,386
Principal pursuant to loan		$ 10,000		$ 20,000		$ 15,552			$ 20,000
Vested portion of shares												31,361,490		8,386	505,927
Common Stock [Member] | Employee One [Member]
Common Stock (Textual)
Common stock, shares issued			520,000
Common stock fair value			$ 520,000
Description of common shares exchanged unvested and vested															The Company recorded $56,174 for the vested portion of the shares, leaving $463,907 of unvested compensation expense to be recognized in future periods.
Common Stock [Member] | Employee [Member]
Common Stock (Textual)
Common stock, shares issued							5,010,000
Common stock fair value							$ 3,256,500
Description of common shares exchanged unvested and vested															The Company recorded $605,004 for the vested portion of the shares, leaving $2,651,496 of unvested compensation expense to be recognized in future periods.
Common Stock [Member] | Climate Esco Ltd [Member]
Common Stock (Textual)
Proceeds from common stock subscriptions											$ 21,000			$ 21,000
Common stock, shares subscribed											1,050			1,050
Common stock price											$ 0.10			$ 0.10
Net of non-controlling interest											$ 7,384			$ 7,384
Common Stock [Member] | Mantra Energy Alternatives Ltd [Member]
Common Stock (Textual)
Common stock, shares subscribed											335			335
Common stock price											$ 1.00			$ 1.00
Net of non-controlling interest											$ 7,231			$ 7,231
Common Stock [Member] | Mantra Energy Alternatives Ltd [Member] | Canada, Dollars
Common Stock (Textual)
Proceeds from common stock subscriptions											$ 67,000			$ 67,000
Common Stock [Member] | Consultant [Member]
Common Stock (Textual)
Vested portion of shares															48,899
Common Stock [Member] | Maximum [Member]
Common Stock (Textual)
Common stock price																	$ 0.00001
Common stock, shares authorized																	750,000,000
Vest terms	36 months
Common Stock [Member] | Maximum [Member] | Employee One [Member]
Common Stock (Textual)
Vest terms			36 months
Common Stock [Member] | Maximum [Member] | Employee [Member]
Common Stock (Textual)
Vest terms							36 months
Vested portion of shares							2,228,508
Common Stock [Member] | Minimum [Member]
Common Stock (Textual)
Common stock price																	$ 0.00001
Common stock, shares authorized																	275,000,000
Vest terms	11 months
Common Stock [Member] | Minimum [Member] | Employee One [Member]
Common Stock (Textual)
Shares vested during period			$ 34,395
Vested portion of shares			429,512
Common Stock [Member] | Minimum [Member] | Employee [Member]
Common Stock (Textual)
Shares vested during period							$ 422,988
Vest terms							18 months

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Preferred Stock (Details) - USD ($)			1 Months Ended		3 Months Ended
	Apr. 16, 2018	Feb. 06, 2018	Oct. 29, 2018	Nov. 15, 2017	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018	May 18, 2018
Preferred Stock (Textual)
Due to related parties
Gain loss on settlement of debt					$ 164,467	$ 561,963
Series B preferred stock voting, description	The holders of shares of Series B Preferred shall be voted together with the shares of Common Stock such that the aggregate voting power of the Series B Preferred is equal to 51% of the total voting power of the Company.
Series A Preferred Stock [Member]
Preferred Stock (Textual)
Series A preferred stock, shares authorized					8,000,000		8,000,000
Preferred stock, shares issued					899,427		899,427
Conversion rights, description				The number of shares of common stock into which each share of the Series A Preferred Shares may be converted shall be determined by dividing the sum of the Stated Value of the Series A Preferred Shares ($1.00 per share) being converted and any accrued and unpaid dividends by the Conversion Price in effect at the time of the conversion. The Series A Preferred Shares may be converted at an initial conversion price of the greater of 75% of the lowest VWAP during the ten trading day period immediately preceding the date a conversion notice is delivered or $0.40.
Series A preferred stock, shares		505,494
Series A preferred stock, value		$ 170,445
Gain loss on settlement of debt		$ 538,359
Series A preferred stock conversion, description			The lowest VWAP during the ten trading day period immediately preceding the Conversion Date (as defined below) or $0.40.
Shares, issued								496,101
Series B Preferred Stock [Member]
Preferred Stock (Textual)
Series A preferred stock, shares authorized					1,000		1,000
Preferred stock, shares issued					1,000		1,000
Shares, issued	1,000
Liquidation preference junior to the Series B Preferred	$ 3,500

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Share Purchase Warrants (Details)	3 Months Ended
	Mar. 31, 2019 $ / shares shares
Warrants and Rights Note Disclosure [Abstract]
Number of warrants, Beginning Balance | shares	1,715,177
Number of warrants, Issued | shares	284,717
Number of warants, Expired | shares	(60,000)
Number of warrants, Ending Balance | shares	1,939,894
Weighted average exercise price, Beginning Balance | $ / shares	$ 2.14
Weighted average exercise price, Issued | $ / shares	1.20
Weighted average exercise price, Expired | $ / shares	0.32
Weighted average exercise price, Ending Balance | $ / shares	$ 1.96

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Share Purchase Warrants (Details 1) - $ / shares		Mar. 31, 2019	Dec. 31, 2018
Class of Warrant or Right [Line Items]
Number of warrants		1,939,894	1,715,177
Exercise price		$ 1.96	$ 2.14
April 10, 2019 [Member]
Class of Warrant or Right [Line Items]
Number of warrants		20,375
Exercise price		$ 74.00
April 28, 2020 [Member]
Class of Warrant or Right [Line Items]
Number of warrants		137,500
Exercise price		$ 5.10
June 27, 2020 [Member]
Class of Warrant or Right [Line Items]
Number of warrants		250,000
Exercise price		$ 0.10
February 13, 2021 [Member]
Class of Warrant or Right [Line Items]
Number of warrants	[1]	593,064
Exercise price		$ 0.20
February 21, 2021 [Member]
Class of Warrant or Right [Line Items]
Number of warrants		125,000
Exercise price		$ 1.60
May 17, 2020 [Member]
Class of Warrant or Right [Line Items]
Number of warrants		500,000
Exercise price		$ 1.00
September 10, 2019 [Member]
Class of Warrant or Right [Line Items]
Number of warrants		200,000
Exercise price		$ 0.00010
October 10, 2021 [Member]
Class of Warrant or Right [Line Items]
Number of warrants		113,955
Exercise price		$ 1.08

[1] This warrant is convertible into 4% of the number of common shares of the Company outstanding. At March 31, 2019, 4% of the number of shares of the Company outstanding was 14,826,590 shares.

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Share Purchase Warrants (Details Textual)	3 Months Ended
	Mar. 31, 2019 shares
Share Purchase Warrants Textual [Abstract]
Number of warrant shares of the company outstanding	14,826,590
Percentage of warrant convertible shares	4.00%

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Leases (Details) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Leases [Abstract]
Operating lease assets	$ 232,325,000
Current operating lease liabilities	233,191
Total operating lease liabilities	$ 233,191,000

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Leases (Details 1)	Mar. 31, 2019 USD ($)
Leases [Abstract]
2019	$ 173,727,000
2020	88,431,000
2021	61,372,000
2022	63,214,000
2023	21,330,000
2024
Total lease payments	408,074,000
Less: imputed interest	(174,883,000)
Total operating lease liabilities	$ 233,191,000

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Leases (Details Textual)	3 Months Ended
	Mar. 31, 2019 USD ($)
Leases [Abstract]
Additional net lease assets	$ 269,341
Net lease liabilities	269,341
Non-cash operating lease liabilities	269,341
operating lease expense	48,175
Measurement of operating lease liabilities	47,309
ROU liabilities	$ 36,105
Weighted average discount rate	48.00%
Lease payments term	5 years
Short-term lease costs	$ 78,035

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Commitments and Contingencies (Details Textual)	3 Months Ended
	Mar. 31, 2019
Commitments and Contingencies (Textual)
Lease term, description	The Company leases certain of its properties under leases that expire on various dates through 2023. Some of these agreements include escalation clauses and provide for renewal options ranging from one to five years. Leases with an initial term of 12 months or less and immaterial leases are not recorded on the balance sheet.

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Segment Disclosures (Details) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
Segment Reporting Information [Line Items]
Net Sales	$ 11,335,732	$ 4,327,764
Operating (loss) income	14,699	(743,491)
Interest expense	471,412	179,325
Depreciation and amortization	93,952	47,833
Total Assets	18,036,886		$ 12,930,396
Spectrum Global [Member]
Segment Reporting Information [Line Items]
Net Sales
Operating (loss) income	(954,967)	(666,247)
Interest expense	399,555	107,894
Depreciation and amortization
Total Assets	15,067	99,835
AWS [Member] | ADEX [Member]
Segment Reporting Information [Line Items]
Net Sales		4,327,764
Operating (loss) income		(77,242)
Interest expense		71,431
Depreciation and amortization		47,833
Total Assets		$ 12,830,561
ADEX/TNS [Member] | ADEX [Member]
Segment Reporting Information [Line Items]
Net Sales	11,335,732
Operating (loss) income	969,666
Interest expense	71,857
Depreciation and amortization	93,952
Total Assets	$ 18,021,819

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Segment Disclosures (Details 1) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Segment Reporting Information [Line Items]
Revenues, Consolidated Total	$ 11,335,732	$ 4,327,764
Long-Lived Assets, Consolidated Total	4,327,763	4,022,273
PUERTO RICO
Segment Reporting Information [Line Items]
Revenues, Consolidated Total	310,478	3,371
Long-Lived Assets, Consolidated Total	466,624	5,377
UNITED STATES
Segment Reporting Information [Line Items]
Revenues, Consolidated Total	11,025,254	6,817,755
Long-Lived Assets, Consolidated Total	$ 3,861,140	$ 4,016,895

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Segment Disclosures (Details Textual)	3 Months Ended
	Mar. 31, 2019 Segments Area	Mar. 31, 2018 Segments
Segment Disclosures (Textual)
Number of operating segments | Segments	2	2
Number of geographical area | Area	1
Segment reporting, description	The Company operates the SGS reporting segment in one geographical area (the United States), the AW Solutions operating segment in two geographical areas (the United States and Puerto Rico), and the ADEX operating segment in two geographical areas (the United States and Puerto Rico).

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Net (Loss) Income Per Share (Details) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Numerator:
Net income (loss)	$ (1,332,587)	$ 134,269
Convertible note interest		87,860
Adjusted diluted net income (loss)	$ (1,332,587)	$ 222,129
Weighted average shares outstanding used in computing net income per share:
Basic	11,771,927	2,225,809
Effect of dilutive stock options and convertible notes payable		6,194,355
Effect of preferred shares		8,842
Diluted	11,771,927	8,429,006
Net income (loss) per share applicable to common stockholders:
Basic	$ (0.11)	$ 0.06
Diluted	$ (0.11)	$ 0.03

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Subsequent Events (Details) - USD ($)					1 Months Ended	3 Months Ended
	May 10, 2019	May 03, 2019	Apr. 13, 2019	Apr. 02, 2019	Apr. 23, 2019	Mar. 31, 2019	Mar. 31, 2018	May 06, 2019	Dec. 31, 2018
Subsequent Events (Textual)
Conversion value of common stock						$ 1,042,254	$ 92,703
InterCloud [Member]
Subsequent Events (Textual)
Aggregate principal amount									$ 793,894
Subsequent Event [Member]
Subsequent Events (Textual)
Amendment Description	The Company entered into an amendment to the note payable described in Note 8(g). Pursuant to the amendment the maturity date of the note was extended from January 15, 2019 to June 1, 2019.		The Company amended the note described in Note 6(d). Pursuant to the amendment, the notes maturity was extended from April 13, 2019 to April 13, 2020. In addition, the interest rate increased from 8% to 10%.
Conversion shares of common stock				1,400,000	799,980
Conversion value of common stock				$ 70,000	$ 30,000
Accrued interest				$ 6,930	$ 9,999
Subsequent Event [Member] | InterCloud [Member]
Subsequent Events (Textual)
Aggregate of shares issued								15,707,163
Subsequent Event [Member] | Exchange Agreement [Member]
Subsequent Events (Textual)
Aggregate principal amount		$ 1,052,632
Accrued interest		$ 295,746
Description of exchange note		The interest on the outstanding principal due under the Exchange Note accrues at a rate of 12% per annum. All principal and accrued interest under the Exchange Note is due on October 17, 2020 and is convertible into shares of the Company's Common Stock. The conversion price in effect on the date such conversion is effected shall be equal to (i) initially, $0.10 or (ii) on or after the date of the closing of the next public or private offering of equity or equity-linked securities of the Company in which the Company receives gross proceeds in an amount greater than $100,000, one hundred and five percent (105%) of the price of the Common Stock issuable in the offering. While during the first six months that the Exchange Note is outstanding, only interest payments are due to the Holder, beginning in October 2019, and on each monthly anniversary thereafter until maturity, amortization payments are due for principal and interest due under the Exchange Note. The Exchange Note includes customary events of default, including non-payment of the principal or accrued interest due on the Exchange Note. Upon an event of default, all obligations under the Exchange Note will become immediately due and payable.
Subsequent Event [Member] | Senior Secured Convertible Promissory note [Member] | Exchange Agreement [Member]
Subsequent Events (Textual)
Aggregate principal amount		$ 1,571,134
Subsequent Event [Member] | Senior Secured Convertible Promissory note [Member]
Subsequent Events (Textual)
Conversion shares of common stock					699,980
Conversion value of common stock					$ 25,000
Accrued interest					$ 9,999