Subsequent Events

9 Months Ended

Oct. 02, 2021

Subsequent Events [Abstract]

Subsequent Events

Subsequent Events

On October 21, 2021, the company entered into a five-year, $4.5 billion amended and restated credit agreement (the “Credit Agreement”). The Credit Agreement amends and restates the company’s prior $3.1 billion credit facility. The Credit Agreement provides for a new senior secured credit facility in an aggregate principal amount of $4.5 billion, consisting of (i) a $1 billion term loan facility, (ii) a $750 million delayed draw term loan facility and (iii) a $2.75 billion multi-currency revolving credit facility, with the potential, under certain circumstances, to increase the amount of the credit facility by the greater of $625 million and 100% of consolidated EBITDA for the most recently ended period of consecutive fiscal quarters (plus additional amounts, subject to compliance with a senior secured net leverage ratio), either by increasing the revolving commitment or by adding one or more revolver or term loan tranches.The credit facility matures on October 21, 2026, with the potential to extend the maturity date in one year increments with the consent of the extending lenders. All obligations under the Credit Agreement are secured by substantially all the assets of the company and certain of the company’s material domestic subsidiaries, and unconditionally guaranteed by, subject to certain exceptions, the company and certain of the company’s direct and indirect material foreign and domestic subsidiaries.

The term loan facility will amortize in equal quarterly installments due on the last day of each fiscal quarter, commencing with the first full fiscal quarter after October 21, 2021, in an aggregate annual amount equal to 2.50% of the original aggregate principal amount of the term loan facility, with the balance, plus any accrued interest, due and payable on October 21, 2026. The delayed draw term loan facility is available for borrowing within one year. The delayed draw term loan facility will amortize in quarterly installments due on the last day of each fiscal quarter, commencing with the first full fiscal quarter after each delayed draw term loan borrowing in an amount equal to 0.625% of the original aggregate principal amount of such borrowing, with the balance, plus any accrued interest, due and payable on October 21, 2026. The Credit Agreement requires the company to satisfy the following financial covenants: (i) a minimum Interest Coverage Ratio (as defined in the Credit Agreement) of 3.00 to 1.00; and (ii) a maximum Secured Leverage Ratio (as defined in the Credit Agreement) of Funded Secured Debt less Unrestricted Cash to Pro Forma EBITDA (each as defined in the Credit Agreement) of 3.75 to 1.00, which may be adjusted to 4.25 to 1.00 for a four consecutive fiscal quarter period in connection with certain qualified acquisitions, subject to the terms and conditions contained in the Credit Agreement. The Credit Agreement provides availability to provide working capital, capital expenditures, to support the issuance of letters of credit and other general corporate purposes, as well as for financing permitted acquisitions. The foregoing description of the Credit Agreement does not purport to be complete and is qualified in its entirety by reference to the Credit Agreement, a copy of which is attached as Exhibit 10.1 hereto.