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Financing
 12 Months Ended
Dec. 31, 2022
Debt Disclosure [Abstract]  
Financing FINANCING
The Company had the following debt outstanding as of December 31:
($ in millions)20222021
Short-term borrowings:
India Credit Facility$— $1.5 
Other short-term borrowings and bank overdrafts4.6 2.2 
Total short-term borrowings$4.6 $3.7 
Long-term debt:
Two-Year Term Loans due 2023$— $600.0 
Three-Year Term Loans due 2024400.0 400.0 
Three-Year Term Loans due 2025600.0 — 
1.800% senior unsecured notes due 2026
500.0 500.0 
2.400% senior unsecured notes due 2028
500.0 500.0 
2.950% senior unsecured notes due 2031
600.0 600.0 
Revolving Credit Facility due 2026— — 
Total long-term debt2,600.0 2,600.0 
Less: discounts and debt issuance costs(14.3)(16.2)
Total long-term debt, net$2,585.7 $2,583.8 
Debt issuance costs that have been netted against the aggregate principal amounts of the components of debt in the short-term borrowings section above are immaterial. Given the nature of the short-term borrowings, the carrying value approximates fair value at both December 31, 2022 and 2021.
We made interest payments of $67.5 million, $37.1 million and $5.9 million during the years ended December 31, 2022, 2021 and 2020, respectively, related to the Company’s long-term debt.
As of December 31, 2022, the contractual maturities of the Company’s long-term debt were as follows:
($ in millions)
2023$— 
2024400.0 
2025600.0 
2026500.0 
2027— 
Thereafter1,100.0 
Total principal payments$2,600.0 
Credit Facilities

A&R Credit Agreement
On April 28, 2021 (the “Closing Date”), the Company executed an amended and restated credit agreement (the “A&R Credit Agreement”), which consists of a $400.0 million three-year term loan (the “Three-Year Term Loans Due 2024”) and a $750.0 million Revolving Credit Facility. Two of the Company’s wholly-owned subsidiaries are Guarantors under the A&R Credit Agreement. The A&R Credit Agreement addresses the discontinuation of LIBOR and its impact on U.S. dollar and multicurrency loans.
The A&R Credit Agreement contains various affirmative and negative covenants, including financial reporting requirements and limitations on indebtedness, liens, mergers, consolidations, liquidations and dissolutions, sales of assets, dividends and other restricted payments, investments (including acquisitions) and transactions with affiliates. Certain affirmative covenants, including certain reporting requirements and requirements to establish cash dominion accounts with the administrative agent, are triggered by failing to maintain availability under the credit facility at or above specified thresholds or by the existence of an event of default under the facility.
The A&R Credit Agreement contains covenants which require a maximum consolidated leverage ratio of 3.75 to 1.0 and a minimum consolidated interest coverage ratio of 3.50 to 1.0.
The A&R Credit Agreement contains events of default customary for facilities of this nature, including, but not limited, to: (i) events of default resulting from the Borrowers’ failure or the failure of any credit party to comply with covenants (including the above-referenced financial covenants during periods in which the financial covenants are tested); (ii) the occurrence of a change of control; (iii) the institution of insolvency or similar proceedings against the Borrowers or any credit party; and (iv) the occurrence of a default under any other material indebtedness the Borrowers or any guarantor may have. Upon the occurrence and during the continuation of an event of default, subject to the terms and conditions of the A&R Credit Agreement, the lenders will be able to declare any outstanding principal balance of our Credit Facility, together with accrued and unpaid interest, to be immediately due and payable and exercise other remedies, including remedies against the collateral, as more particularly specified in the A&R Credit Agreement. As of December 31, 2022, the Company was in compliance with its debt covenants under the A&R Credit Agreement.
Three-Year Term Loans Due 2024

The Three-Year Term Loans Due 2024 bear interest at a variable rate equal to LIBOR plus a ratings-based margin which was 112.5 basis points as of December 31, 2022. The interest rate on the $400.0 million of Three-Year Term Loans Due 2024 outstanding as of December 31, 2022 was 5.51% per annum. The Three-Year Term Loans Due 2024 mature on October 28, 2024, and there is no obligation to make repayments prior to the maturity date. The Company is not permitted to re-borrow once the Three-Year Term Loans due 2024 are repaid and there is no further ability to draw on the facility. There was no material difference between the carrying value and the estimated fair value of the debt outstanding.

Revolving Credit Facility

The Revolving Credit Facility requires the Company to pay lenders a commitment fee for unused commitments of 0.125% to 0.325% based on the ratings grid. As of December 31, 2022, there were no amounts outstanding under the Revolving Credit Facility. The Revolving Credit Facility bears interest at a variable rate equal to LIBOR plus a ratings-based margin which was 117.5 basis points as of December 31, 2022.

Two-Year Term Loans Due 2023

On August 5, 2021, the Company entered into a two-year, $600.0 million senior unsecured delayed-draw term loan (the “Two-Year Term Loans Due 2023”) with a syndicate of lenders. The Company’s two wholly-owned subsidiaries which are Guarantors under the A&R Credit Agreement are also Guarantors under the two-year, $600.0 million senior unsecured delayed-draw term loan. On September 13, 2021, the Company drew the entire $600.0 million and used the proceeds to fund the acquisition of DRB. The Two-Year Term Loans Due 2023 were fully repaid on December 30, 2022 utilizing the proceeds of the Three-Year term Loans Due 2025, discussed below.
Three-Year Term Loans Due 2025

On October 28, 2022 the Company entered into a three-year, $600.0 million senior unsecured delayed draw term loan (the “Three-Year Term Loans Due 2025”) with a syndicate of lenders. The Company’s two wholly-owned subsidiaries which are Guarantors under the A&R Credit Agreement are also Guarantors under the three-year, $600.0 million senior unsecured delayed-draw term loan. On December 30, 2022, the Company drew the entire $600.0 million and used the proceeds to pay off the existing Two-Year Term Loans Due 2023.

The Three-Year Term Loans Due 2025 bear interest at a variable rate equal to SOFR plus a 10.0 basis points credit spread adjustment plus a ratings based margin which was 125.0 basis points as of December 31, 2022. The interest rate on the Three-Year Term Loans outstanding as of December 31, 2022 was 5.67% per annum. The Three-Year Term Loans Due 2025 mature on December 30, 2025 and the Company is not obligated to make repayments prior to the maturity date. The Company is not permitted to re-borrow once the Three-Year Term Loans Due 2025 are repaid and there is no further ability to draw on the facility.

As of December 31, 2022, there was no material difference between the carrying value and the estimated fair value of the debt outstanding.

The Three-Year Term Loans Due 2025 require, among others, that the Company maintains certain financial covenants, and the Company was in compliance with all of these covenants as of December 31, 2022.
Senior Unsecured Notes
On March 10, 2021, the Company completed the private placement of each of the following series of senior unsecured notes (collectively, the “Notes”) to qualified institutional buyers under Rule 144A of the Securities Act of 1933, as amended (the “Securities Act”) and outside the United States to non-U.S. persons in compliance with Regulation S under the Securities Act:
•$500.0 million aggregate principal amount of senior notes due April 1, 2026 (the “2026 Notes”) issued at 99.855% of their principal amount and bearing interest at the rate of 1.800% per year;
•$500.0 million aggregate principal amount of senior notes due April 1, 2028 (the “2028 Notes”) issued at 99.703% of their principal amount and bearing interest at the rate of 2.400% per year; and
•$600.0 million aggregate principal amount of senior notes due April 1, 2031 the (the “2031 Notes”) issued at 99.791% of their principal amount and bearing interest at the rate of 2.950% per year.
The Company received approximately $1.6 billion in net proceeds from the issuance of the Notes, which was partially offset by discounts of $3.5 million and debt issuance costs of $13.9 million. The Company used the net proceeds to repay $1.4 billion of debt with the remainder used for working capital and other general corporate purposes.
In connection with the issuance of the Notes, the Company entered into a registration rights agreement, pursuant to which the Company is obligated to use commercially reasonable efforts to file with the U.S. Securities and Exchange Commission, and cause to be declared effective within 365 days, a registration statement with respect to an offer to exchange (the “Registered Exchange Offer”) each series of Notes for registered notes with terms that are substantially identical to the Notes of each series. The Registered Exchange Offer was completed on January 18, 2022. Substantially all of the Notes were tendered and exchanged for the corresponding Registered Notes in the Registered Exchange Offer.
The Registered Notes are fully and unconditionally guaranteed (the “Guarantees”), on a joint and several basis, by Gilbarco Inc. and Matco Tools Corporation, two of Vontier’s wholly-owned subsidiaries (the “Guarantors”). Interest on the Registered Notes is payable semi-annually in arrears on April 1 and October 1 of each year, and commenced on October 1, 2021. The Registered Notes and the Guarantees are the Company’s and the Guarantors’ general senior unsecured obligations.
The Company may redeem some or all of each series of the Registered Notes at any time prior to the dates specified in the Registered Notes indenture (the “Call Dates”) at a redemption price equal to the greater of (i) 100% of the principal amount of the Registered Notes of such series to be redeemed, and (ii) the sum of the present values of the remaining scheduled payments of principal and interest on such series of the Registered Notes to be redeemed discounted to the date of redemption on a semi-annual basis at the applicable Treasury Rate plus 20 basis points in the case of the 2026 Notes and 2028 Notes and plus 25 basis points in the case of the 2031 Notes, plus the accrued and unpaid interest. Call dates for the 2026 Notes, 2028 Notes and 2031 Notes are March 1, 2026, February 1, 2028 and January 1, 2031, respectively.
If a change of control triggering event occurs, the Company will, in certain circumstances, be required to make an offer to repurchase the Registered Notes at a purchase price equal to 101% of the aggregate principal amount plus accrued and unpaid interest. A change of control triggering event is defined as the occurrence of both a change of control and a rating event, each as defined in the Registered Notes indenture. Except in connection with a change of control triggering event, the Registered Notes do not have any credit rating downgrade triggers that would accelerate the maturity of the Registered Notes.
The Registered Notes contain customary covenants, including limits on the incurrence of certain secured debt and sale-leaseback transactions. None of these covenants are considered restrictive to the Company’s operations and as of December 31, 2022 the Company was in compliance with all of the covenants under the Registered Notes.
The estimated fair value of the Registered Notes was $1.2 billion as of December 31, 2022. The fair value of the Registered Notes was determined based upon Level 2 inputs including indicative prices based upon observable market data. The difference between the fair value and the carrying amounts of the Registered Notes may be attributable to changes in market interest rates and/or the Company’s credit ratings subsequent to the incurrence of the borrowing.
Short-term Borrowings
India Credit Facility
The Company has a credit facility with Citibank, N.A. with borrowing capacity of up to 850.0 million Indian Rupees (or $10.3 million as of December 31, 2022) to facilitate working capital needs for certain businesses in India. As of December 31, 2022, the Company had no borrowings outstanding and $10.3 million of borrowing capacity remaining.
Other

As of December 31, 2022, certain of our businesses were in a cash overdraft position, and such overdrafts are included in Short-term borrowings on the Consolidated Balance Sheet. Additionally, the Company has other short-term borrowing arrangements with various banks to facilitate short-term cash flow requirements in certain countries which are included in Short-term borrowings on the Consolidated Balance Sheets.

Interest payments associated with the above short-term borrowings were not significant for the years ended December 31, 2022, 2021 and 2020.