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Debt and Bank Credit Facilities
 12 Months Ended
Dec. 31, 2022
Long-Term Debt, Unclassified [Abstract]  
Debt and Bank Credit Facilities Debt and Bank Credit Facilities
The Company's indebtedness as of December 31, 2022 and January 1, 2022 was as follows:
December 31, 2022January 1, 2022
Term Facility$536.3 $620.0 
Private Placement Notes500.0 — 
Land Term Facility486.8 486.8 
Multicurrency Revolving Facility429.0 736.7 
Other76.7 78.7 
Less: Debt Issuance Costs(5.3)(3.7)
Total2,023.5 1,918.5 
Less: Current Maturities33.8 4.9 
Non-Current Portion$1,989.7 $1,913.6 

Credit Agreement

On March 28, 2022, the Company entered into a Second Amended and Restated Credit Agreement with the Company's lenders (the “Credit Agreement”) with JPMorgan Chase Bank, N.A., as Administrative Agent and the lenders named therein. The Credit Agreement (i) replaced in its entirety the Amended and Restated Credit Agreement, dated as of August 27, 2018, as amended by that First Amendment, dated March 17, 2021, among the Company and other parties thereto and (ii) amended and restated in its entirety the Amended and Restated Credit Agreement, dated as of October 4, 2021, among Land and the other parties thereto (collectively, the “Former Credit Agreements”).

The Credit Agreement provides for, among other things, an extension of the maturity date of the revolving credit facility and term loans provided under the Former Credit Agreements. Prior to the First Amendment (as defined below), the credit facilities extended under the Credit Agreement consisted of (i) an unsecured term loan facility in the initial principal amount of up to $550.0 million, maturing on March 28, 2027 (the "Term Facility"); (ii) an unsecured term loan facility in the initial principal amount of $486.8 million, under which Land remains the sole borrower, maturing on March 28, 2027 (the "Land Term Facility"); and (iii) an unsecured revolving loan in the initial principal amount of up to $1,000.0 million, maturing on March 28, 2027 (the "Multicurrency Revolving Facility"), including a $50.0 million letter of credit sub facility, available for general corporate purposes. Borrowings under the Credit Agreement bear interest at floating rates based upon indices determined by the currency of the borrowing (SOFR for US Dollar borrowings), plus an applicable margin determined by reference to our consolidated funded debt to consolidated EBITDA ratio or at an alternative base rate. The Credit Agreement is subject to customary and market provisions. The subsidiaries of the Company that provided a guaranty of the Company's and Land's obligations under the Former Credit Agreements also entered into subsidiary guaranty agreements with respect to the obligations under the Credit Agreement.

The Term Facility was drawn in full on March 28, 2022 to refinance the Former Credit Agreements, pay fees, costs, and other expenses incurred therewith, to fund working capital needs and for general corporate purposes of the Company and its subsidiaries. The Term Facility requires quarterly amortization at 5.0% per annum, unless previously prepaid. Per the terms of the Credit Agreement, prepayments can be made without penalty and be applied to the next payment due.
On November 17, 2022, the Company entered into an amendment (the “First Amendment”) with certain of the Company’s lenders under the Credit Agreement. Among other things, the First Amendment (i) permits the consummation of the Altra Transaction and the incurrence of indebtedness and liens in an aggregate principal amount not to exceed $4,900.0 million in connection with the Altra Transaction; (ii) establishes incremental term loan commitments of $600.0 million under the Term Facility, to be funded upon consummation of the Altra Transaction; and (iii) provides an increase of $500.0 million in the aggregate principal amount of the Multicurrency Revolving Facility upon consummation of the Altra Transaction.

On November 30, 2022, the Company entered into an incremental assumption agreement (the “Assumption Agreement”) with JPMorgan Chase Bank, N.A., as Administrative Agent and the lenders named therein. Among other things, the Assumption Agreement (i) establishes incremental term loan commitments of $240.0 million under the Term Facility, to be funded upon consummation of the Altra Transaction and (ii) provides an increase of $70.0 million in the aggregate principal amount of the Multicurrency Revolving Facility upon consummation of the Altra Transaction.
The weighted average interest rate on the Term Facility for the fiscal years ended December 31, 2022 and January 1, 2022 was 2.9% and 1.2%, respectively. The Credit Agreement requires that the Company prepay the loans under the Term Facility with 100% of the net cash proceeds received from specified asset sales and borrowed money indebtedness, subject to certain exceptions. We repaid $13.7 million under the Term Facility in fiscal 2022.

As of December 31, 2022 the Company had $429.0 million of borrowings under the Multicurrency Revolving Facility, and $571.0 million of available borrowing capacity. No standby letters of credit were issued under the Multicurrency Revolving Facility. The average daily balance in borrowings under the Multicurrency Revolving Facility was $675.4 million and $163.6 million, and the weighted average interest rate on the Multicurrency Revolving Facility was 2.8% and 1.2% for the fiscal years ended December 31, 2022 and January 1, 2022, respectively. The Company pays a non-use fee on the aggregate unused amount of the Multicurrency Revolving Facility at a rate determined by reference to its consolidated funded debt to consolidated EBITDA ratio. In connection with the issuance of the Senior Notes in January 2023, further discussed below, the outstanding borrowings under the Multicurrency Revolving Facility were fully repaid.

As of December 31, 2022, the Company had $486.8 million of borrowings under the Land Term Facility. The Land Term Facility has no required amortization. The weighted average interest rate on the Land Term Facility was 3.0% and 1.3% for the fiscal years ended December 31, 2022 and January 1, 2022, respectively.

Private Placement Notes
On April 7, 2022, the Company entered into a Note Purchase Agreement with certain institutional accredited investors (the "Private Placement Notes Purchase Agreement") for the issuance and sale of $500.0 million aggregate principal amount of 3.90% notes due April 7, 2032 (the "Private Placement Notes"), in an offering exempt from the registration requirements of the Securities Act of 1933, as amended. The Company used the net proceeds from the offering for general corporate purposes.

On December 21, 2022, the Company entered into an amendment to the Private Placement Notes Purchase Agreement with certain holders of the Private Placement Notes, which would have, among other things, (i) permitted the consummation of the Altra Transaction, and (ii) added a maintenance fee of 2.50% per annum on the unpaid principal amount of the Private Placement Notes upon consummation of the Altra Transaction. Following the issuance of the Senior Notes discussed below, on January 27, 2023, the Company used a portion of the proceeds from that transaction to repay the Private Placement Notes in full with no make-whole payments.

Bridge Facility

In connection with the Altra Transaction, on October 26, 2022, the Company entered into a commitment letter (the “Commitment Letter”), and related fee letters, with JPMorgan Chase Bank, N.A. pursuant to which JPMorgan Chase Bank, N.A. (i) committed to provide the Company approximately $5,500.0 million in aggregate principal amount of senior bridge loans under a 364-day senior unsecured bridge term loan facility (the “Bridge Facility”) for the purpose of funding, in part, the Altra Transaction, repaying certain outstanding indebtedness of Altra, and for general corporate purposes and (ii) agreed to use commercially reasonable efforts to arrange financing (through the issuance of notes and/or the incurrence of term loans) in an aggregate principal amount of up to approximately $5,500.0 million for the purpose of replacing the Bridge Facility. There were $4,160.0 million in Bridge Facility commitments remaining at December 31, 2022. Upon issuance of the Senior Notes in January 2023, as further discussed below, the Bridge Facility was terminated.

In connection with the Bridge Facility, the Company paid $27.5 million in fees in the fourth quarter of 2022, of which $10.5 million were recognized in Interest Expense during the year ended December 31, 2022 and $17.0 million was deferred on the Consolidated Balance Sheet as of December 31, 2022 and was recognized in Interest Expense in the first quarter of 2023 when the Bridge Facility was terminated.

Backstop Facility

In connection with the Altra Transaction, on October 26, 2022, the Company entered into a backstop credit facility with JPMorgan Chase Bank, N.A. in an aggregate principal amount of up to $2,030.0 million, consisting of a $1,000.0 million backstop revolving credit facility and $1,030.0 million backstop term loan facility (collectively, the “Backstop Facility”). The Backstop Facility was terminated on November 17, 2022 when the Company entered into the First Amendment to the Credit Agreement further discussed above. In connection with the Backstop Facility, the Company paid $5.1 million in fees which were recognized in Interest Expense during the year ended December 31, 2022.

Senior Notes
On January 24, 2023, the Company entered into an Indenture (the “Indenture”) with U.S. Bank Trust Company, National Association, as trustee (the “Trustee”), relating to the issuance by the Company of $1,100.0 million aggregate principal amount of its 6.05% senior notes due 2026 (the “2026 Senior Notes”), $1,250.0 million aggregate principal amount of its 6.05% senior notes due 2028 (the “2028 Senior Notes”), $1,100.0 million aggregate principal amount of its 6.30% senior notes due 2030 (the “2030 Senior Notes”) and $1,250.0 million aggregate principal amount of its 6.40% senior notes due 2033 (the “2033 Senior Notes” and, together with the 2026 Senior Notes, 2028 Senior Notes and 2030 Senior Notes, collectively, the “Senior Notes”).

The Senior Notes were issued and sold in a private offering to persons reasonably believed to be qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933 and persons outside the United States in accordance with Regulation S under the Securities Act. Pursuant to a registration rights agreement, the Company will exchange the Senior Notes with registered notes with terms substantially identical to the Senior Notes within 540 days from the date of issuance.

The Company received $4,647.0 million in net proceeds from the sale of the Senior Notes, after deducting the initial purchasers’ discounts and estimated offering expenses. The Company used a portion of the net proceeds to repay the Company’s outstanding Private Placement Notes, as further discussed above, and intends to use the remaining net proceeds, together with the incremental term loan commitments under the Term Facility and cash on hand, to fund the consideration for the Altra Transaction, repay certain of Altra’s outstanding indebtedness, and pay certain fees and expenses. Prior to the consummation of the Altra Transaction, the Company used a portion of the proceeds to repay the outstanding borrowings under the Multicurrency Revolving Facility in January 2023 and invested the remaining net proceeds of approximately $3.6 billion in interest bearing accounts.

The rate of interest on each series of the Senior Notes is subject to an increase of up to 2.00% in the event of certain downgrades in the debt rating of the Senior Notes. Interest on the 2026 Senior Notes and the 2030 Senior Notes will be payable semi-annually on February 15 and August 15 of each year, beginning on August 15, 2023. Interest on the 2028 Senior Notes and the 2033 Senior Notes will be payable semi-annually on April 15 and October 15 of each year, beginning on April 15, 2023. The 2026 Senior Notes are scheduled to mature on February 15, 2026, the 2028 Senior Notes are scheduled to mature on April 15, 2028, the 2030 Senior Notes are scheduled to mature on February 15, 2030, and the 2033 Senior Notes are scheduled to mature on April 15, 2033.

Compliance with Financial Covenants

The Credit Agreement requires the Company to meet specified financial ratios and to satisfy certain financial condition tests. The Note Purchase Agreement contains financial covenants consistent with the financial covenants in the Credit Agreement. The Company was in compliance with all financial covenants contained in the Credit Agreement and Note Purchase Agreement as of December 31, 2022.

Other Notes Payable

As of December 31, 2022, other notes payable of $76.7 million were outstanding with a weighted average interest rate of 5.1%. As of January 1, 2022, other notes payable of $78.7 million were outstanding with a weighted average interest rate of 5.2%. These amounts consist primarily of finance leases. See Note 9 – Leases for more information.

Other Disclosures

Based on rates for instruments with comparable maturities and credit quality, which are classified as Level 2 inputs (see also Note 14 – Fair Value), the approximate fair value of the Company's total debt was $1,926.6 million and $1,918.5 million as of December 31, 2022 and January 1, 2022, respectively.

Maturities of long-term debt outstanding as of December 31, 2022, excluding debt issuance costs, are as follows:
YearAmount of Maturity
2023$33.8 
202431.1 
202531.4 
202631.5 
20271,346.3 
Thereafter554.7 
Total$2,028.8