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Item 5.02
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Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
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Chief Executive Officer and President
On May 22, 2020 the Board of Directors announced that Richard
D Calder, Jr. will depart from his position as Chief Executive Officer and President of GTT Communications, Inc. (the “Company”)
and from all offices and positions he holds with the Company’s direct and indirect subsidiaries, effective June 1, 2020.
On May 25, 2020, Mr. Calder resigned from his position as a Director of the Company and all of its direct and indirect subsidiaries
effective June 1, 2020 and informed the Board that his resignation as a Director will be effective June 1, 2020 regardless of whether
he is elected to such position at the Company’s annual meeting of stockholders to be held May 27, 2020.
In order to ensure continuity going forward,
H. Brian Thompson, Nick Adamo, and Benjamin Stein, members of our Board of Directors, will provide additional guidance and support
to the Company’s senior executive team on an interim basis while the Company conducts an executive search for Mr. Calder’s
replacement. The information specified in Item 5.02(c)(2) of Form 8-K with respect to Messrs. Thompson, Adamo, and Stein,
is set forth in the Company’s proxy statement, filed on April 24, 2020, and is incorporated by reference herein.
Chief Revenue Officer
On May 22, 2020, the Board
of Directors appointed Ernie Ortega as Chief Revenue Officer of the Company. Mr. Ortega, age 54, has served since June 17, 2019
as Division President, Americas of the Company, where he has been responsible for all primary client experience functions in the
Americas for enterprise, channel, carrier and government clients, including sales, quoting, ordering, service delivery and overall
client account management to drive revenue growth for GTT. From January 2017 until joining the Company, Mr. Ortega served as CEO
of Towerstream Corporation, a fixed-wireless fiber alternative company delivering high-speed internet access to businesses. From
January 2016 until his appointment as the CEO of Towerstream, Mr. Ortega served as an advisor and consultant to Towerstream. Prior
to that Mr. Ortega served as the Chief Revenue Officer of Colt Technology Services from October 2015 to December 2016, as Chief
Revenue Officer of Cogent Communications Holdings, Inc. from August 2013 to October 2015. He previously served as EVP Sales &
Marketing of XO Communications from June 1999 until August 2013.
Mr. Ortega entered into
an employment agreement with the Company at the time he joined the Company in 2019. This agreement is now being reviewed and potentially
amended in light of his promotion to Chief Revenue Officer. Pursuant to his employment agreement, Mr. Ortega’s salary is
currently $350,000 per annum and he is eligible to participate in the Company’s benefit plans. Mr. Ortega is eligible to
earn an annual discretionary bonus of up to 60% of his salary, with the bonus formula and annual target bonus amount being subject
to review and adjustment in accordance with the Company’s customary practices concerning compensation for similarly situated
employees. Pursuant to his employment agreement, Mr. Ortega has been granted 20,000 shares of restricted common stock in the Company,
which will vest in equal annual installments over a four year term, with 25% vesting on the first anniversary of the grant and
the remainder vesting in equal quarterly installments thereafter. Mr. Ortega has also been granted 20,000 shares of restricted
common stock in the Company, which will begin to vest based upon the achievement of specified targets for the Company’s revenue,
adjusted free cash flow and EBITDA (earnings before interest, tax, depreciation and amortization) and continue to vest in quarterly
installments for the one- or two-year periods following the achievement of such targets. The vesting of Mr. Ortega’s equity
awards will be accelerated in full upon a change of control of the Company. In the event the Company terminates Mr. Ortega’s
employment without cause or Mr. Ortega terminates his employment for ‘good reason’, then, subject to certain conditions,
the Company will pay severance to him in the form of salary and health benefit continuation for a period of twelve months and a
prorated bonus for the year in which such termination occurs. The foregoing description of Mr. Ortega’s employment agreement
does not purport to be complete and is qualified in its entirety by reference to the full text of the employment agreement, which
is filed as Exhibit 10.1 to this Form 8-K and incorporated herein by reference.
Except as described above,
there are no arrangements or understandings between Mr. Ortega and any other persons pursuant to which Mr. Ortega was appointed
as the Company’s Chief Revenue Officer. With respect to the disclosure required by Item 401(d) of Regulation S-K, there
are no family relationships between Mr. Ortega and any director or executive officer of the Company. With respect to Item 404(a)
of Regulation S-K, there are no relationships or related transactions between Mr. Ortega and the Company that would be required
to be reported.