Item 1.01. Entry into a Material Definitive Agreement.
Amendment to Priming Facility Credit Agreement
As previously disclosed, on December 28, 2020, the Company entered into that certain Priming Facility Credit Agreement (as amended, restated, amended and restated, supplemented or otherwise modified, the “Priming Facility Credit Agreement”), among the Company, GTT Communications B.V. (“GTT B.V.”), the lenders party thereto (the “PTL Lenders”) and Delaware Trust Company, as administrative agent (the “PTL Agent”). The Priming Facility Credit Agreement provides for a priming term loan facility consisting of initial and delayed draw term loans in a principal amount of up to $275,000,000 (the “New Term Loan Facility”). On March 29, 2021, the Company, GTT B.V., the PTL Lenders party thereto and the PTL Agent entered into that certain Second Amendment to Priming Facility Credit Agreement (the “Second PTL Amendment”). The Second PTL Amendment, among other things, extended the deadline to deliver the Company’s audited consolidated financial statements under the Priming Facility Credit Agreement for the fiscal year ended December 31, 2020 to April 15, 2021 and provided that PTL Lenders holding a majority of the loans and commitments under the New Term Loan Facility (“New Term Loan Facility Required Lenders”) may further extend such deadline by notice to the Company. On April 12, 2021, the Company received a notice on behalf of PTL Lenders constituting New Term Loan Facility Required Lenders consenting to an extension of the deadline to deliver the Company’s audited consolidated financial statements under the Priming Facility Credit Agreement for the fiscal year ended December 31, 2020 to April 22, 2021. On April 20, 2021, the Company received a notice on behalf of PTL Lenders constituting New Term Loan Facility Required Lenders consenting to an extension of such deadline to May 3, 2021. On April 30, 2021, the Company received a notice on behalf of PTL Lenders constituting New Term Loan Facility Required Lenders consenting to a further extension of such deadline to May 10, 2021.
As previously disclosed, on May 10, 2021, the Company, GTT B.V., the PTL Lenders party thereto constituting New Term Loan Facility Required Lenders and the PTL Agent entered into that certain Third Amendment to Priming Facility Credit Agreement (the “Third PTL Amendment”). The Third PTL Amendment, among other things, extended the deadlines under the Priming Facility Credit Agreement to deliver the Company’s audited consolidated financial statements for the fiscal year ended December 31, 2020 and the Company’s unaudited consolidated financial statements for the fiscal quarter ended March 31, 2021 (the “Late PTL Reports”) to May 17, 2021. On May 17, 2021, the Company, GTT B.V., the PTL Lenders party thereto constituting New Term Loan Facility Required Lenders and the PTL Agent entered into that certain Fourth Amendment to Priming Facility Credit Agreement (the “Fourth PTL Amendment”). The Fourth PTL Amendment, among other things, extended the deadlines to deliver the Late PTL Reports to June 3, 2021 and provided that PTL Lenders constituting New Term Loan Facility Required Lenders may further extend each of these deadlines by notice to the Company. On June 2, 2021, the Company received a notice on behalf of PTL Lenders constituting New Term Loan Facility Required Lenders consenting to an extension of the deadlines to deliver the Late PTL Reports to June 17, 2021. On June 15, 2021, the Company received a notice on behalf of PTL Lenders constituting New Term Loan Facility Required Lenders consenting to an extension of the deadlines to deliver the Late PTL Reports to June 28, 2021. On June 28, 2021, the Company received a notice on behalf of PTL Lenders constituting New Term Loan Facility Required Lenders consenting to an extension of the deadlines to deliver the Late PTL Reports to July 6, 2021. On July 6, 2021, the Company received a notice on behalf of PTL Lenders constituting New Term Loan Facility Required Lenders consenting to an extension of the deadlines to deliver the Late PTL Reports to July 12, 2021.
On July 12, 2021, the Company, GTT B.V., the PTL Lenders party thereto constituting New Term Loan Facility Required Lenders (the “Consenting PTL Lenders”) and the PTL Agent entered into that certain Fifth Amendment to Priming Facility Credit Agreement (the “Fifth PTL Amendment”). The Fifth PTL Amendment, among other things, (i) further extends the deadlines under the Priming Facility Credit Agreement to deliver the Late PTL Reports to July 20, 2021 (the “New Expiration Date”), (ii) amends the covenant with respect to compliance with periodic budgets the Company is required to deliver to certain lenders to exclude certain tax amounts payable from negative variance calculations and add a variance test relating to the payment of such tax amounts, (iii) requires the Company to provide information to the advisors to certain PTL Lenders relating to certain tax obligations and (iv) directs the PTL Agent to release liens on certain deposit accounts and the cash and/or cash equivalents contained therein (the “Specified Assets”) so that such assets may secure certain letters of credit issued by Barclays Bank PLC or any affiliate thereof and provides that the Consenting PTL Lenders consent to the incurrence of reimbursement obligations in respect of such letters of credit and the incurrence of new liens in favor of Barclays Bank PLC or any affiliate thereof to secure reimbursement obligations in respect of such letters of credit (the “Barclays Cash Collateralization”). The Company paid fees and expenses of certain advisors to the Consenting PTL Lenders and the PTL Agent in connection with the entry into the Fifth PTL Amendment.
The foregoing description of the Fifth PTL Amendment is not complete and is qualified in its entirety by the terms and provisions of the Fifth PTL Amendment, a copy of which is filed herewith as Exhibit 10.1 and is incorporated herein by reference.
Extension of Second Notes Forbearance Agreement
As previously disclosed, on December 28, 2020, the Company and the guarantors (the “Guarantors”) under that certain Indenture, dated as of December 22, 2016 (as amended, supplemented or otherwise modified, the “Indenture”), by and between the Company, as successor by merger to GTT Escrow Corporation, and Wilmington Trust, National Association, as Trustee (the “Trustee”), entered into that certain Noteholder Forbearance Agreement (as amended, supplemented, or otherwise modified, the “Second Notes Forbearance Agreement”) with certain beneficial owners (or nominees, investment managers, advisors or subadvisors for the beneficial owners) (the “Forbearing Noteholders”) of a majority of the outstanding aggregate principal amount of the Company’s outstanding 7.875% Senior Notes due 2024 (the “Notes” and the holders of such Notes, the “Noteholders”). Pursuant to the Second Notes Forbearance Agreement, the Forbearing Noteholders agreed to, among other provisions, forbear from exercising any and all rights and remedies under the Indenture, the Notes and applicable law, including not directing the Trustee to take any such action, with respect to defaults and events of default that have occurred, or that may occur as a result of, (i) the Company’s failure to timely file its Quarterly Reports on Form 10-Q for the quarters ended June 30, 2020 (the “Q2 2020 Form 10-Q”) and September 30, 2020 (the “Q3 2020 Form 10-Q”) and (ii) the occurrence and continuance of the “Lender Specified Defaults” as defined in the applicable forbearance agreement with respect to the Credit Agreement (as defined below), in each case until the earlier of (a) 5:00 p.m., New York City time, on March 31, 2021 and (b) the receipt of notice from Forbearing Noteholders regarding their intent to terminate the Second Notes Forbearance Agreement upon the occurrence of certain specified forbearance defaults. The Second Notes Forbearance Agreement may be amended with the consent of Forbearing Noteholders holding more than 66.7% of the aggregate principal amount of the Notes held by all Forbearing Noteholders, provided that at least two of such consenting Forbearing Noteholders are unaffiliated (“Requisite Forbearing Noteholders”).
As previously disclosed, on March 29, 2021, the Company and the Guarantors entered into that certain First Amendment to Noteholder Forbearance Agreement (the “Second Notes Forbearance Agreement Amendment No. 1”) with Forbearing Noteholders constituting Requisite Forbearing Noteholders. The Second Notes Forbearance Agreement Amendment No. 1, among other things, (i) provided that in addition to the matters originally subject to forbearance in the Second Notes Forbearance Agreement, the Forbearing Noteholders will forbear from exercising any and all rights and remedies under the Indenture, the Notes and applicable law, including not directing the Trustee to take any such action, with respect to defaults and events of default that have occurred, or that may occur as a result of, the Company’s failure to timely file its Annual Report on Form 10-K for the fiscal year ended December 31, 2020 (the “2020 Form 10-K”) and (ii) amended the scheduled expiration time under the Second Notes Forbearance Agreement to 5:00 p.m., New York City time, on April 15, 2021. On April 12, 2021, the Company received a notice on behalf of Forbearing Noteholders constituting Requisite Forbearing Noteholders consenting to an extension of the scheduled expiration time under the Second Notes Forbearance Agreement to 5:00 p.m., New York City time, on April 22, 2021. On April 19, 2021, the Company received a notice on behalf of Forbearing Noteholders constituting Requisite Forbearing Noteholders consenting to an extension of the scheduled expiration time under the Second Notes Forbearance Agreement to 5:00 p.m., New York City time, on May 3, 2021. On April 28, 2021, the Company received a notice on behalf of Forbearing Noteholders constituting Requisite Forbearing Noteholders consenting to an extension of the scheduled expiration time under the Second Notes Forbearance Agreement to 5:00 p.m., New York City time, on May 10, 2021. On May 10, 2021, the Company and the Guarantors entered into that certain Second Amendment to Noteholder Forbearance Agreement (the “Second Notes Forbearance Agreement Amendment No. 2”) with Forbearing Noteholders constituting Requisite Forbearing Noteholders. The Second Notes Forbearance Agreement Amendment No. 2, among other things, amended the scheduled expiration time under the Second Notes Forbearance Agreement to 5:00 p.m., New York City time, on May 17, 2021.
As previously disclosed, on May 17, 2021, the Company and the Guarantors entered into that certain Third Amendment to Noteholder Forbearance Agreement (the “Second Notes Forbearance Agreement Amendment No. 3”) with Forbearing Noteholders constituting Requisite Forbearing Noteholders. The Second Notes Forbearance Agreement Amendment No. 3, among other things, (i) provided that in addition to the matters subject to forbearance in the Second Notes Forbearance Agreement as previously amended, the Forbearing Noteholders will forbear from exercising any and all rights and remedies under the Indenture, the Notes and applicable law, including not directing the Trustee to take any such action, with respect to defaults and events of default that have occurred, or that may occur as a result of, the Company’s failure to timely file its Quarterly Report on Form 10-Q for the quarter ended March 31, 2021 (the “Q1 2021 Form 10-Q”) and (ii) amended the scheduled expiration time under the Second Notes Forbearance Agreement to 5:00 p.m., New York City time, on June 3, 2021. On May 28, 2021, the Company received a notice on behalf of Forbearing Noteholders constituting Requisite Forbearing Noteholders consenting to an extension of the scheduled expiration time under the Second Notes Forbearance Agreement to 5:00 p.m., New York City time, on June 17, 2021. On June 11, 2021, the Company received a notice on behalf of Forbearing Noteholders constituting Requisite Forbearing Noteholders consenting to an extension of the scheduled expiration time under the Second Notes Forbearance Agreement to 5:00 p.m., New York City time, on June 28, 2021. On June 28, 2021, the Company and the Guarantors entered into that certain Fourth Amendment to Noteholder Forbearance Agreement (the “Second Notes Forbearance Agreement Amendment No. 4”) with Forbearing Noteholders constituting Requisite Forbearing Noteholders. The Second Notes Forbearance Agreement Amendment No. 4, among other things, (i) amended the scheduled expiration time under the Second Notes Forbearance Agreement to 5:00 p.m., New York City time, on July 6, 2021 and (ii) provided that in addition to the matters subject to forbearance in the Second Notes Forbearance Agreement as previously
amended, the Forbearing Noteholders will forbear from exercising any and all rights and remedies under the Indenture, the Notes and applicable law, including not directing the Trustee to take any such action, with respect to defaults and events of default that have occurred, or that may occur as a result of, the Company’s failure to make the approximately $22.6 million interest payment due on June 30, 2021 on the Notes as required pursuant to the Indenture. On July 2, 2021, the Company received a notice on behalf of Forbearing Noteholders constituting Requisite Forbearing Noteholders consenting to an extension of the scheduled expiration time under the Second Notes Forbearance Agreement to 5:00 p.m., New York City time, on July 12, 2021.
On July 8, 2021, the Company received a notice on behalf of Forbearing Noteholders constituting Requisite Forbearing Noteholders consenting to an extension of the scheduled expiration time under the Second Notes Forbearance Agreement to 5:00 p.m., New York City time, on the New Expiration Date.
Amendment to Fourth Lender Forbearance Agreement
As previously disclosed, on May 10, 2021, the Company, GTT B.V. and the other credit parties party thereto entered into that certain Fourth Lender Forbearance Agreement and Amendment No. 5 to Credit Agreement (the “Fourth Lender Forbearance Agreement”) with (1) lenders holding (a) a majority of the outstanding loans and revolving commitments (“Required Lenders”) and (b) a majority of the revolving commitments (“Required Revolving Lenders”) under that certain Credit Agreement, dated as of May 31, 2018, by and among the Company and GTT B.V., as borrowers, KeyBank National Association, as administrative agent and letter of credit issuer (the “Agent”), and the lenders and other financial institutions party thereto from time to time (the “Lenders”) (as amended, restated, amended and restated, supplemented or otherwise modified, the “Credit Agreement”), (2) certain hedge providers to the Company (the “Secured Hedge Providers” and collectively with the Lenders party to the Fourth Lender Forbearance Agreement, the “Consenting Lenders”) and (3) the Agent. Pursuant to the Fourth Lender Forbearance Agreement, the Consenting Lenders agreed to, among other things, forbear from exercising any and all rights and remedies under the Loan Documents (as defined in the Credit Agreement), any secured hedge agreement with the Secured Hedge Providers (the “Secured Hedge Agreements”) and applicable law (as applicable), including not directing the Agent to take any such action, with respect to certain defaults and events of default under the Credit Agreement and certain events of default under any Secured Hedge Agreement (as applicable) that have occurred, or that may occur as a result of, (i) the Company’s failure to timely file the Q2 2020 Form 10-Q, the Q3 2020 Form 10-Q, the 2020 Form 10-K and the Q1 2021 Form 10-Q, and related compliance certificates, (ii) any amendment, supplement, modification, restatement and/or withdrawal or public statement of non-reliance on (A) any audit opinion related to historical consolidated financial statements or (B) historical consolidated financial statements and (iii) the occurrence and continuance of the “Noteholder Specified Defaults” as defined in the Second Notes Forbearance Agreement, in each case until the earlier of (a) 5:00 p.m., New York City time, on May 17, 2021 and (b) the receipt of notice from Consenting Lenders regarding intent to terminate the Fourth Lender Forbearance Agreement upon the occurrence of certain specified forbearance defaults. The Fourth Lender Forbearance Agreement may be amended with the consent of (i) Required Lenders and (ii) Required Revolving Lenders (except that the extension of the forbearance period with respect to any of the Secured Hedge Providers requires the consent of such Secured Hedge Provider).
As previously disclosed, on May 14, 2021 and May 16, 2021, the Company received notices on behalf of Lenders constituting Required Revolving Lenders and Required Lenders, respectively, consenting to an extension of the scheduled expiration time under the Fourth Lender Forbearance Agreement to 5:00 p.m., New York City time, on June 3, 2021. On June 2, 2021, the Company, GTT B.V. and the other credit parties party thereto entered into that certain First Amendment to Fourth Lender Forbearance Agreement (the “Fourth Lender Forbearance Agreement Amendment No. 1”) with Lenders constituting Required Lenders and Required Revolving Lenders. The Fourth Lender Forbearance Agreement Amendment No. 1, among other things, amended the scheduled expiration time under the Fourth Lender Forbearance Agreement to 5:00 p.m., New York City time, on June 17, 2021. On June 15, 2021 and June 16, 2021, the Company received notices on behalf of Lenders constituting Required Lenders and Required Revolving Lenders, respectively, consenting to an extension of the scheduled expiration time under the Fourth Lender Forbearance Agreement to 5:00 p.m., New York City time, on June 28, 2021. On June 28, 2021, the Company, GTT B.V. and the other credit parties party thereto entered into that certain Second Amendment to Fourth Lender Forbearance Agreement (the “Fourth Lender Forbearance Agreement Amendment No. 2”) with Lenders constituting Required Lenders and Required Revolving Lenders. The Fourth Lender Forbearance Agreement Amendment No. 2, among other things, amended the scheduled expiration time under the Fourth Lender Forbearance Agreement to 5:00 p.m., New York City time, on July 6, 2021. On July 2, 2021 and July 6, 2021, the Company received notices on behalf of Lenders constituting Required Revolving Lenders and Required Lenders, respectively, consenting to an extension of the scheduled expiration time under the Fourth Lender Forbearance Agreement to 5:00 p.m., New York City time, on July 12, 2021.
On July 12, 2021, the Company, GTT B.V. and the other credit parties party thereto entered into that certain Third Amendment to Fourth Lender Forbearance Agreement and Consent (the “Fourth Lender Forbearance Agreement Amendment No. 3”) with Lenders constituting Required Lenders and Required Revolving Lenders (the “Consenting Lenders”). The Fourth Lender Forbearance Agreement Amendment No. 3, among other things, (i) amends the scheduled expiration time under the Fourth Lender Forbearance Agreement to 5:00 p.m., New York City time, on the New Expiration Date and (ii) directs the Agent to release liens on the Specified Assets and to consent to the Barclays Cash Collateralization. The Company paid fees
and expenses of certain advisors to the Consenting Lenders and the Agent in connection with the entry into the Fourth Lender Forbearance Agreement Amendment No. 3.
The foregoing description of the Fourth Lender Forbearance Agreement Amendment No. 3 is not complete and is qualified in its entirety by the terms and provisions of the Fourth Lender Forbearance Agreement Amendment No. 3, a copy of which is filed herewith as Exhibit 10.2 and is incorporated herein by reference.