MCLEAN, VA, December 22, 2020 (GLOBE NEWSWIRE) – GTT communication, Inc. (NYSE: GTT), a global leader in cloud networking for multinational customers, announced today that it has signed a letter of commitment that some of GTT’s existing lenders and creditors have pledged to give the company a new loan with a delayed Term of USD 275 million to provide facility.
Ernie Ortega, GTT Interim CEO, said, “We are excited to announce this development and appreciate the support of our lenders and shareholders in providing their commitment to this new facility.
This term loan ensures we have the appropriate resources to execute our business plan as we work towards completing the sale of our infrastructure division to I Squared Capital in 2021.
This also shows our commitment to providing a stable and responsible operating environment for our key stakeholders, including employees, customers, suppliers and suppliers. “
GTT assumes that the financing will be completed by December 28, 2020 at the latest under certain conditions.
In addition, as previously announced, the management of GTT and the audit committee of the company’s board of directors have dealt extensively with the review of certain accounting issues with the support of external advisors. As can be seen from a current report on Form 8-K submitted today, the Board of Directors of GTT has come to the conclusion that the previously published consolidated financial statements for and for the financial years ending on December 31, 2019, 2018 and 2017 for the quarters of the years effective ended December 31, 2019 and 2018, and the quarter ended March 31, 2020 should no longer be relied upon. GTT intends to submit the adjusted consolidated financial statements for these periods as soon as possible.
GTT connects people in organizations, around the world and with every application in the cloud. Our customers benefit from an excellent service experience based on our core values of simplicity, speed and agility. GTT owns and operates a tier 1 global internet network and offers a comprehensive suite of cloud network services. For more information on GTT (NYSE: GTT), see www.gtt.net.
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, and such statements are intended to be covered by the safe haven they provide. These statements are based on the current beliefs and expectations of GTT management and are subject to significant risks and uncertainties. The above statements regarding GTT’s new term loan and the proposed sale of its infrastructure division constitute forward-looking statements based on GTT’s current expectations. Because these forward-looking statements involve risks and uncertainties, many of which are beyond the control of GTT, there are important factors that could cause future events to differ materially from those in the forward-looking statements. These factors include, but are not limited to, the impact of general economic and financial market conditions on GTT’s business and customers, and the following: (1) GTT recently announced that its previously published financial statements for the years ended December 31st 2019, 2018 and 2017, each of the quarters in the years ending December 31, 2019 and 2018 and the quarter ending March 31, 2020 (the “Non-Reliance Periods”), as well as related information and notices should not exceed Result of Preliminary Results of GTT’s ongoing accounting review (the “Review”); (2) Completing the review and completing and submitting GTT’s quarterly reports on Form 10-Q for the quarters ending June 30, 2020 and September 30, 2020, as well as further future periodic filings and adjusted financial statements for the non-reliance Periods may be longer than expected due to the timing or results of the review or review process by GTT’s independent, registered accountancy firm; (3) GTT does not expect that compliance with the continued listing requirements of the New York Stock Exchange in relation to the timely filing of its regular filings can be restored prior to February 17, 2021 and may not receive any further renewal to restore compliance. (4) Funding terms and conditions set out in the new fixed-term loan commitment letter and related loan agreement, including certain consents from revolving lenders, fixed-term lenders, and creditors that have not currently been obtained, may not have been met and funding may not be obtained and existing cash and operating funds may not be sufficient to fund GTT operations and meet cash needs. (5) GTT and I Squared Capital (the “Buyer”) may not be able to obtain the necessary approvals for the pending infrastructure sale transaction (the “Transaction”) or related reorganization (the “Reorganization”) announced by GTT on October 16, 2020 ”) By government agencies in a timely manner, on terms acceptable to sellers and buyers, or at all; (6) GTT may not be able to obtain from its lenders or shareholders any further indulgences, waivers, consents, clearances or other arrangements that may be required to prevent a default under GTT’s loan agreement (the “Loan Agreement”) or to prevent the contract with GTT from making any comments (the “Indenture”) that may be required in order to satisfy the conditions for the completion of the Transaction, either on terms acceptable to GTT or at all. In this case, the sales and purchase agreement for the transaction would end unless the buyer waived; (7) GTT may not be able to obtain the consent of certain contracting parties to contracts with GTT and its subsidiaries that are necessary for the complete execution of the transaction or reorganization on terms acceptable to GTT or at all. (8) GTT may not be able to obtain sufficient funding to complete the Transaction in accordance with the purchase and sale agreement for the Transaction. (9) the possible failure to meet other closing conditions under the purchase and sale agreement for the Transaction, which could result in the Transaction not being completed; (10) GTT’s possible failure to realize the anticipated benefits of the Transaction; (11) Risks of using the Buyer for various critical Transaction Services and Network Services for an extended period of time under the Transitional Service Agreement and Master Service Agreement provided for in the Purchase and Sale Agreement for the Transaction; (12) the potential impact of the announcement or completion of the reorganization and transaction on relationships with third parties, including customers, employees and competitors; (13) the ability to acquire new customers and retain existing customers in the manner expected; (14) GTT’s internal control over financial reporting may be inadequate or have weaknesses that GTT is currently unaware of or that have not been discovered, and which, among other things, could affect GTT’s ability to adequately take into account the purchase price adjustment mechanisms in the purchase agreement for the transaction; (15) GTT cannot meet certain obligations in relation to obligations to deliver financial statements and representations in relation to the financial statements of GTT contained in its financing agreements without receiving a change and / or a waiver of what will lead to (A) default events in the Under the Indenture and the Loan Agreement, (B) if the Company cannot obtain any further agreements from creditors relating to the prohibition of exercising legal remedies, the acceleration of the outstanding debentures under the Indenture and the obligations of GTT under the Loan Agreement, and (C) GTT is unable to meet its obligations hereunder; (16) GTT is exposed to risks associated with the actions of network operators and a concentrated number of providers and customers. (17) GTT could be exposed to cyber attacks and other security breaches. (18) The GTT network can experience serious disruptions when certain locations are damaged or when GTT adds functionality and updates its network. (19) GTT is subject to risks in connection with purchase obligations to providers for longer terms or beyond the volume promised by GTT’s underlying customers or sales obligations to customers that go beyond GTT’s obligations to the underlying suppliers. (20) GTT may not be able to establish and maintain peering relationships with other providers or agreements with carrier-neutral data center operators. (21) The business, earnings and financial position of GTT are subject to the effects of the COVID-19 pandemic and the associated market and economic conditions. (22) GTT can be affected by information systems that do not work as expected, or by consolidation, competition, regulation or a downturn in the GTT industry. (23) GTT may be responsible for the material that content providers distribute over their network. (24) GTT has made net losses in the past and can continue to do so. (25) GTT may not be able to successfully integrate future acquisitions or manage its growth efficiently. (26) GTT may not be able to retain or hire key employees. (27) GTT recently announced changes in its management. (28) GTT is subject to risks related to the international conduct of its business. (29) GTT may be affected by future increased taxes. and (30) GTT has significant debt that could prevent it from meeting its obligations under its debt agreements or exposing GTT to interest rate risk. The list of factors above is not intended to be exhaustive. GTT undertakes no obligation to update the forward-looking statements to reflect the effects of any circumstances or events that may occur after the date of the forward-looking statements. For a discussion of a variety of risk factors that affect the business and prospects of GTT, see “Risk Factors” in GTT’s annual and quarterly reports filed with the SEC, including, but not limited to, the Annual Report on Form 10- K for fiscal year ended December 31, 2019 and its Quarterly Report on Form 10-Q for the quarter ended March 31, 2020, filed with the SEC and posted on GTT’s website (www.gtt.net) and on the SEC website (www.sec) .gov).
GTT media inquiries:
Rachel Hawkins, LEWIS
GTT Investor Relations:
Carolyn Capaccio / Jody Burfening, LHA