Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically ~~and posted on its corporate Web site, if any,~~ every Interactive Data File required to be submitted ~~and posted~~ pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit ~~and post~~ such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of ~~October 20, 2017, 29,275,362~~April 30, 2021, there were 64,790,562 outstanding shares of ~~Common Stock,~~the registrant’s common stock, $0.001 par value per ~~share, were outstanding.~~

	September 30, 2017			December 31, 2016			March 31, 2021			December 31, 2020
	(Unaudited)						(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	53,151		$	69,118		$	249.4		$	254.4
Trade receivables, less allowance for doubtful accounts of $5,479 and $3,114 at September 30, 2017 and December 31, 2016, respectively		136,511			120,319
Trade receivables, less allowance for credit losses of $4.6 and $4.9 million at March 31, 2021 and December 31, 2020, respectively								259.0			240.8
Inventories		153,014			139,840			222.7			210.4
Income tax receivable		7,822			607			9.3			6.9
Prepaid expenses and other current assets		16,671			10,429			40.5			35.7
Assets held for sale		364			3,874
Total current assets		367,533			344,187			780.9			748.2
Property, plant and equipment, net		190,455			177,043			333.2			344.2
Goodwill, net								1,575.3			1,596.0
Intangible assets, net		160,939			154,683			1,425.2			1,459.6
Goodwill		203,574			188,841
Deferred income taxes		1,383			2,510			2.5			4.9
Other non-current assets, net		2,147			2,560
Other non-current assets								13.0			14.2
Operating lease right of use assets								37.4			41.0
Total assets	$	926,031		$	869,824		$	4,167.5		$	4,208.1
LIABILITIES, AND STOCKHOLDERS’ EQUITY
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	59,624		$	60,845		$	172.7		$	163.6
Accrued payroll		29,761			31,302			60.6			76.2
Accruals and other current liabilities		38,137			35,080			77.6			73.0
Income tax payable		8,887			706			15.3			17.9
Current portion of long-term debt		380			43,690			16.6			16.6
Operating lease liabilities								12.6			13.3
Total current liabilities		136,789			171,623			355.4			360.6
Long-term debt - less current portion and net of unaccreted discount		295,223			325,969
Long-term debt, net of current portion								1,388.3			1,408.1
Deferred income taxes		57,471			61,084			354.1			359.6
Pension liabilities		27,269			23,691			33.5			35.4
Long-term taxes payable								2.7			3.6
Other long-term liabilities		25,714			4,109			14.9			14.3
Operating lease liabilities, net of current portion								26.8			29.8

Stockholders’ equity:
Common stock ($0.001 par value, 90,000,000 shares authorized, 29,054,378 and 27,206,162 issued and outstanding at September 30, 2017 and December 31, 2016, respectively)		29			27
Common stock ($0.001 par value per share, 120,000,000 shares authorized, 64,770,540 and 64,676,567 shares issued and outstanding at March 31, 2021 and December 31, 2020, respectively)								0.1			0.1
Additional paid-in capital		222,605			168,299			1,706.4			1,706.0
Retained earnings		215,766			191,108			304.8			269.5
Accumulated other comprehensive loss		(54,835	)		(76,086	)
Accumulated other comprehensive income/(loss)								(19.5	)		21.1
Total stockholders’ equity		383,565			283,348			1,991.8			1,996.7
Total liabilities, and stockholders’ equity	$	926,031		$	869,824
Total liabilities and stockholders’ equity							$	4,167.5		$	4,208.1

The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.

	Quarter Ended
	March 31, 2021			March 31, 2020
	(Unaudited)			(Unaudited)
Net sales	$	472.1		$	434.2
Cost of sales		300.4			281.2
Gross profit		171.7			153.0
Operating expenses:
Selling, general and administrative expenses		89.8			87.1
Impairment of goodwill and intangible asset		—			147.5
Research and development expenses		15.9			14.8
Restructuring costs		0.9			1.6
		106.6			251.0
Income from operations		65.1			(98.0	)
Other non-operating income and expense:
Interest expense, net		16.9			17.4
Other non-operating expense/(income), net		(1.5	)		(1.5	)
		15.4			15.9
Income/(Loss) before income taxes		49.7			(113.9	)
Provision for income taxes		10.5			2.7
Net income/(loss)	$	39.2		$	(116.6	)
Weighted average shares, basic		64.7			64.5
Weighted average shares, diluted		65.3			64.5
Net income/(loss) per share:
Basic	$	0.61		$	(1.81	)
Diluted	$	0.60		$	(1.81	)
Cash dividend declared per share	$	0.06		$	0.17

The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.

	Year to Date Ended
	March 31, 2021			March 31, 2020
	(Unaudited)			(Unaudited)
Cash flows from operating activities
Net income/(loss)	$	39.2		$	(116.6	)
Adjustments to reconcile net income/(loss) to net operating cash flows:
Depreciation		13.1			14.6
Amortization of intangible assets		17.6			17.5
Amortization of deferred financing costs		1.2			1.1
Gain on foreign currency, net		(0.2	)		(2.1	)
Accretion of debt discount		0.1			0.1
Non-cash amortization of interest rate swap expense		3.1			—
Impairment of goodwill and intangible asset		—			147.5
Loss on disposal and other		0.1			—
Stock-based compensation		3.5			3.3
Changes in assets and liabilities:
Trade receivables		(21.5	)		(4.7	)
Inventories		(15.5	)		(11.8	)
Accounts payable and accrued liabilities		5.7			(0.9	)
Other current assets and liabilities		(10.7	)		(10.8	)
Other operating assets and liabilities		0.5			(2.3	)
Net cash provided by operating activities		36.2			34.9
Cash flows from investing activities
Purchase of property, plant and equipment		(9.6	)		(8.2	)
Proceeds from cross-currency interest rate swap settlement		—			56.2
Net cash (used in) provided by investing activities		(9.6	)		48.0
Cash flows from financing activities
Borrowing under Revolving Credit Facility		—			100.0
Payments on Term Loan Facility		(20.0	)		(6.0	)
Dividend payments		(3.9	)		(11.3	)
Net payments on financing leases, mortgages, and other obligations		(0.4	)		(0.1	)
Net proceeds/(payments) from China debt		0.3			(0.6	)
Shares surrendered for tax withholding		(3.1	)		(1.9	)
Net cash (used in) provided by financing activities		(27.1	)		80.1
Effect of exchange rate changes on cash and cash equivalents		(4.5	)		(3.4	)
Net change in cash and cash equivalents		(5.0	)		159.6
Cash and cash equivalents at beginning of period		254.4			167.3
Cash and cash equivalents at end of period	$	249.4		$	326.9
Cash paid during the period for:
Interest paid on borrowings	$	6.4		$	12.5
Income taxes paid	$	16.6		$	9.6

The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.

	Common Stock		Shares		Additional Paid in Capital		Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Total
Balance at January 1, 2021	$	0.1		64.7	$	1,706.0	$	269.5		$	21.1		$	1,996.7
Stock-based compensation and vesting of restricted stock, net of withholdings		—		0.1		0.4		—			—			0.4
Net income		—		—		—		39.2			—			39.2
Dividends declared, $0.06 per share		—		—		—		(3.9	)		—			(3.9	)
Total comprehensive income/(loss), net of tax		—		—		—		—			(40.6	)		(40.6	)
Balance at March 31, 2021	$	0.1		64.8	$	1,706.4	$	304.8		$	(19.5	)	$	1,991.8

	Common Stock		Shares		Additional Paid in Capital		Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Total
Balance at January 1, 2020	$	0.1		64.2	$	1,696.7	$	315.4		$	(89.9	)	$	1,922.3
Stock-based compensation and vesting of restricted stock, net of withholdings		—		0.4		1.4		—			—			1.4
Net loss		—		—		—		(116.6	)		—			(116.6	)
Dividends declared, $0.17 per share		—		—		—		(11.1	)		—			(11.1	)
Total comprehensive income/(loss), net of tax		—		—		—		—			(38.9	)		(38.9	)
Balance at March 31, 2020	$	0.1	$	64.6	$	1,698.1	$	187.7		$	(128.8	)	$	1,757.1

The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.

Quarter Ended

Year to Date Ended

September 30, 2017

September 30, 2016

September 30, 2017

September 30, 2016

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

Net sales

$
214,623

$
173,132

$
653,415

$
536,259

Cost of sales

145,610

118,957

446,109

369,254

Gross profit

69,013

54,175

207,306

167,005

Operating expenses:

Selling, general and administrative expenses

41,009

36,142

123,012

105,548

Research and development expenses

6,051

4,267

18,434

13,345

Restructuring costs

680

3,397

3,776

6,591

47,740

43,806

145,222

125,484

Income from operations

21,273

10,369

62,084

41,521

Other non-operating income and expense:

Interest expense, net

1,811

2,815

5,547

8,615

Other non-operating expense (income), net

696

45

30

(438
)
Loss on extinguishment of convertible debt

—

—

1,797

—

2,507

2,860

7,374

8,177

Income before income taxes

18,766

7,509

54,710

33,344

Provision for income taxes

5,489

2,196

15,723

9,872

Net income

$
13,277

$
5,313

$
38,987

$
23,472

Weighted average shares, basic

29,008

25,726

28,912

25,684

Weighted average shares, diluted

29,074

26,021

29,001

25,813

Net income per share:

Basic net income

$
0.46

$
0.21

$
1.35

$
0.91

Diluted net income

$
0.46

$
0.20

$
1.34

$
0.91

Cash dividend declared

$
0.17

$
0.15

$
0.49

$
0.45

~~The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.~~

Quarter Ended

Year to Date Ended

September 30, 2017

September 30, 2016

September 30, 2017

September 30, 2016

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

Net Income

$
13,277

$
5,313

$
38,987

$
23,472

Other Comprehensive income (loss):

Foreign currency translation adjustment

6,673

90

21,157

(1,000
)
Change in defined benefit pension plans

65

14

(232
)

134

Change in fair value of derivative financial instruments, net of tax

(331
)

—

326

—

Other comprehensive income (loss):

6,407

104

21,251

(866
)
Comprehensive income

$
19,684

$
5,417

$
60,238

$
22,606

~~The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.~~

Year to Date Ended

September 30, 2017

September 30, 2016

(Unaudited)

(Unaudited)

Cash flows from operating activities

Net income

$
38,987

$
23,472

Adjustments to reconcile net income to net operating cash flows:

Depreciation

19,764

16,235

Amortization of intangible assets

7,139

6,384

Amortization of deferred financing costs

449

590

Loss/(Gain) on foreign currency, net

241

(130
)
Accretion of debt discount, net

—

2,970

(Gain)/Loss on disposal / impairment of fixed assets

(36
)

582

Loss on extinguishment of debt

1,797

—

Stock based compensation

4,543

3,370

Amortization of inventory fair value adjustment

2,347

—

Changes in assets and liabilities:

Trade receivables

(9,701
)

(10,461
)
Inventories

(9,478
)

(837
)
Accounts payable and accrued liabilities

(8,799
)

3,226

Other current assets and liabilities

(2,392
)

728

Other operating assets and liabilities

(1,572
)

765

Net cash provided by operating activities

43,289

46,894

Cash flows from investing activities

Purchase of property, plant and equipment

(23,261
)

(15,684
)
Proceeds from sale of Altra Industrial Motion Changzhou

3,221

—

Working capital settlement from prior year acquisitions

2,883

—

Net cash used in investing activities

(17,157
)

(15,684
)
Cash flows from financing activities

Payments on 2015 Revolving Credit Facility

(39,036
)

(30,870
)
Dividend payments

(13,256
)

(7,784
)
Borrowing under 2015 Revolving Credit Facility

7,000

3,000

Payments of equipment and working capital notes

(913
)

(3,181
)
Cash paid to redeem Convertible Notes

(954
)

—

Proceeds from mortgages and other debt

—

2,893

Shares surrendered for tax withholding

(2,089
)

(1,288
)
Purchases of common stock under share repurchase program

—

(4,713
)
Net cash used in financing activities

(49,248
)

(41,943
)
Effect of exchange rate changes on cash and cash equivalents

7,149

178

Net change in cash and cash equivalents

(15,967
)

(10,555
)
Cash and cash equivalents at beginning of year

69,118

50,320

Cash and cash equivalents at end of period

$
53,151

$
39,765

Cash paid during the period for:

Interest

$
5,413

$
5,856

Income taxes

18,505

7,665

Non-cash Financing and Investing

Conversion of Convertible Notes to common stock

$
51,851

$
—

~~The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.~~

Common
Stock

Shares

Additional
Paid
in Capital

Retained
Earnings

Accumulated
Other
Comprehensive Income
(Loss)

Total

Balance at January 1, 2016

$
26

25,773

$
124,834

$
181,539

$
(63,832
)

$
242,567

Stock-based compensation and vesting
   of restricted stock

—

89

2,082

—

—

2,082

Net income

—

—

—

23,472

—

23,472

Dividends declared

—

—

—

(11,667
)

—

(11,667
)
Changes in Accumulated Other Comprehensive Loss

—

—

—

—

(866
)

(866
)
Repurchases of common
   stock - 177,053 shares

—

(177
)

(4,713
)

—

—

(4,713
)
Balance at September 30, 2016

$
26

25,685

$
122,203

$
193,344

$
(64,698
)

$
250,875

Balance at January 1, 2017

$
27

27,206

$
168,299

$
191,108

$
(76,086
)

$
283,348

Stock-based compensation and vesting
   of restricted stock

—

100

2,457

—

—

2,457

Net income

—

—

—

38,987

—

38,987

Conversion of convertible debt

2

1,748

51,849

—

—

51,851

Dividends declared

—

—

—

(14,329
)

—

(14,329
)
Changes in Accumulated Other Comprehensive Income

—

—

—

—

21,251

21,251

Balance at September 30, 2017

$
29

29,054

$
222,605

$
215,766

$
(54,835
)

$
383,565

~~The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.~~

Headquartered in Braintree, Massachusetts, Altra Industrial Motion Corp. (the ~~“Company”, “we”,~~“Company,” “Altra,” “we,” or “our”) is a leading ~~multi-national~~global designer, producer and marketer of a wide range of electro-mechanical power transmission and motion control products. The Company brings together strong brands ~~covering over 42 product lines~~ with production facilities in ~~twelve~~16 countries. Altra’s leading brands include Ameridrives Couplings, Bauer Gear Motor, Bibby Turboflex, Boston Gear, Delroyd Worm Gear, Formsprag Clutch, Guardian Couplings, Huco, Industrial Clutch, Inertia Dynamics, Jacobs Vehicle Systems, Kilian Manufacturing, Kollmorgen, Lamiflex Couplings, Marland Clutch, Matrix, Nuttall Gear, Portescap, Stieber Clutch, Stromag, Svendborg Brakes, TB Wood’s, Thomson, Twiflex, Warner Electric, Warner Linear, and Wichita Clutch.

The Company’s unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and note disclosures required by generally accepted accounting principles ~~generally accepted~~ in the United States, ~~of America.~~or GAAP. These statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2020, filed with the U.S. Securities and Exchange Commission (the “SEC”) on February 26, 2021 . In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments, consisting of normal recurring adjustments, necessary to present fairly the Company’s financial position ~~for the interim periods presented,~~ and cash flows for the interim periods presented. The results are not necessarily indicative of future results. The Company considers events or transactions that occur after the balance sheet date but before the financial statements are issued to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure.

In ~~August 2017,~~March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial ~~Accounting Standards Board ("FASB"~~Reporting (“ASU 2020-04”)~~issued Accounting Standards Update ("ASU") 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities.~~. This ASU provides ~~new guidance about income statement classification and eliminates~~relief from certain accounting consequences that could result from the ~~requirement to separately measure and report hedge ineffectiveness. The entire change in fair value for qualifying hedge instruments included in~~global markets’ anticipated transition away from the ~~effectiveness will be recorded in other comprehensive income (OCI) and amounts deferred in OCI will be reclassified to earnings in the same income statement line item in which the earnings effect~~use of the ~~hedged item~~London Interbank Offered Rate (“LIBOR”) and other interbank offered rates to alternative reference rates. The relief provided by this ASU is ~~reported.~~elective and applies to all entities, subject to meeting certain criteria, that have contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. The ~~guidance is~~optional amendments are effective ~~for interim and annual periods for the Company on January 1, 2019, with early adoption permitted.~~as of March 12, 2020 through December 31, 2022. The Company ~~does not expect~~is currently evaluating the effect of the adoption of this ~~ASU to have a material impact~~standard on ~~its Consolidated Financial Statements.~~the Company.

We sell our products through3 primary commercial channels: original equipment manufacturers (OEMs), industrial distributors and direct to end users. Each of our segments sells similar products, which are balanced across end-user industries including, without limitation, energy, food processing, general industrial, material handling, mining, transportation, industrial automation, robotics, medical devices, and turf & garden.

As the ~~FASB issued~~Company’s standard payment terms are less than one year, the Company has elected the practical expedient under Accounting Standards ~~Update ("ASU"~~Codification (“ASC”) ~~2016-16,~~ ~~Income Taxes (Topic 740): Intra-Entity Transfers~~606-10-32-18 to not assess whether a contract has a significant financing component. Revenue is recognized when control of ~~Assets Other Than Inventory~~ ~~(“ASU 2016-16”). This ASU requires entities~~the product is transferred to ~~recognize~~ the ~~income tax consequences~~customer (i.e., when the Company’s performance obligation is satisfied), which typically occurs at shipment from the Company’s manufacturing site or delivery to the customer’s named location. In determining whether control has transferred, the Company considers if there is a present right to payment and legal title, along with risks and rewards of ~~many intercompany asset transfers at~~ownership having transferred to the ~~transaction date. The seller and buyer will immediately recognize~~customer. In certain circumstances, the ~~current and deferred income tax consequences of an intercompany~~Company manufactures customized product without alternative use for its customers, which would generally result in the transfer of ~~an asset other than inventory.~~control over time. The ~~tax consequences were previously deferred until~~Company has evaluated the ~~asset~~amount of revenue subject to recognition over time and concluded that it is sold to a third party or recovered through use. This guidance will be effective for the Company on January 1, 2018. We are currently evaluating this guidance and the impact it will have on our consolidated financial statements.immaterial.

~~In August 2016, the FASB issued Accounting Standards Update ("ASU") 2016-15,~~ ~~Statement of Cash Flows (Topic 230): Classification of certain cash receipts and cash payments (a consensus of the emerging issues task force)~~ (“ASU 2016-15”). This ASU addresses the following eight specific cash flow issues: debt prepayment or debt extinguishment costs; settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing; contingent consideration payments made after a business combination; proceeds from the settlement of insurance claims; proceeds from the settlement of corporate-owned life insurance policies (including bank-owned life insurance policies); distributions received from equity method investees; beneficial interests in securitization transactions; and separately identifiable cash flows and application of the predominance principle. This guidance will be effective for the Company on January 1, 2018. We are currently evaluating the impact this guidance will have on our consolidated financial statements.

~~In February 2015, the FASB issued ASU 2016-02,~~ ~~Leases (Topic 842)~~ (“ASU 2016-02”). The ASU requires management to recognize lease assets and lease liabilities by lessees for all operating leases. The ASU is effective for periods beginning after December 15, 2018 and interim periods therein on a modified retrospective basis. We are currently evaluating the impact this guidance will have on our consolidated financial statements and expect to recognize a significant lease obligation upon adoption.

The following table disaggregates our revenue for each reportable segment. The Company believes that disaggregating revenue into these categories achieves the disclosure objective to depict how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors.

Net sales by geographic region based on point of shipment origin are as follows:

The payment terms and conditions in our customer contracts vary. In ~~May 2014,~~some cases, customers will partially prepay for their goods; in other cases, after appropriate credit evaluations, payment will be due in arrears. In addition, there are constraints that cause variability in the ~~FASB issued ASU No. 2014-09~~ ~~Revenue from Contracts with Customers~~ ~~(“ASU 2014-09”). ASU 2014-09 provides a single principles-based, five-step model~~ultimate consideration to be ~~applied to all contracts with customers. The five steps~~recognized. These constraints typically include early payment discounts, volume rebates, rights of return, surcharges, and other customer considerations.

Payments received from customers are ~~to (i) identify the contracts with the customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price~~recorded as accounts receivable when an unconditional right to the ~~performance obligations in~~consideration exists. A contract asset is recognized when the ~~contract and (v) recognize revenue when each~~Company satisfies a performance obligation ~~is satisfied. Revenue will be recognized when~~by transferring a promised ~~goods or services are transferred~~good to the customer before consideration is due. A contract liability is recognized when consideration is received from a customer prior to the Company satisfying the related performance obligation. Contract assets and contract liabilities are recognized in ~~an amount that reflects~~other current assets and other current liabilities, respectively, in the ~~consideration expected in exchange for those goods or services. ASU 2014-09 will be effective~~Company’s consolidated balance sheets.

The Company had inconsequential contract assets for the ~~Company beginning on January 1, 2018.~~three-month periods ended March 31, 2021 and March 31, 2020, respectively. The ~~Company commenced its assessment~~opening and closing balances of ~~ASU 2014-09 during the second half of 2015 and developed a project plan to guide the implementation. The project plan includes analyzing the ASU’s impact on~~ the Company’s current contract portfolio, surveying the Company’s business units and discussing the various revenue streams, completing contract reviews, comparing historical accounting policies and practices to the requirements of the new guidance, identifying potential differences from applying the requirements of the new guidance to its contracts and updating and providing training on its accounting policy. As the Company continues its evaluation, it is also identifying and preparing to implement changes to accounting policies, business processes and internal controls to support the new accounting and disclosure requirements. ~~The Company expects to adopt this new guidance using the modified retrospective method that will result in a cumulative effect adjustment~~liabilities as of the ~~date of adoption. The company does not expect the adoption of this ASU to have a material impact on its Consolidated Financial Statements.~~three-month periods ended March 31, 2021 and March 31, 2020 are as follows:

In the three-month period ended March ~~2016, the FASB issued ASU 2016-09,~~ ~~Compensation - Stock Compensation (Topic 718): Improvements~~31, 2021, substantially all outstanding revenue has been recognized related to ~~Employee Share-Based Payment Accounting~~ ~~(“ASU 2016-09”). The updated guidance revises aspects of stock-based compensation guidance which include income tax consequences, classification of awards as equity or~~contract liabilities ~~and classification on the statement of cash flows. The Company adopted this guidance on~~outstanding at January 1, ~~2017 which resulted in the recognition of excess tax benefits in our provision for income taxes with the~~2021.

Notes to Unaudited Condensed Consolidated Statements of Operations rather than paid-in capital and was not material for the quarter ended September 30, 2017. Additionally, our Unaudited Condensed Consolidated Statements of Cash Flows now present excess tax benefits as an operating activity, effective January 1, 2017. Finally, the Company elected to continue to estimate forfeitures based on historical data and recognizes forfeiture compensation expense over the vesting period of the award. The adoption of this ASU did not have a material impact to our Unaudited Condensed ConsolidatedInterim Financial ~~Statements.~~Statements

~~In July 2015, the FASB issued ASU 2015-11,~~ ~~Simplifying the Measurement of Inventory~~ ~~(“ASU 2015-11”).~~ Under this guidance, entities utilizing the first-in-first-out (“FIFO”) or average cost method should measure inventory at the lower of cost or net realizable value, whereas net realizable value is defined as the estimated selling priceAmounts in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. The Company adopted this guidance on January 1, 2017. The adoption of this ASU did not have a material impact to our Unaudited Condensed Consolidated Financial Statements.millions, unless otherwise noted

Fair value is determined based upon the exit price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants, as determined by either the principal market or the most advantageous market. Inputs used in the valuation techniques to derive fair values are classified based on a three-level hierarchy, as follows:

The Company considers all highly liquid investments purchased with a remaining maturity of three months or less to be cash ~~equivalents.~~

equivalents and are classified as Level 1. The carrying values of financial instruments, including ~~accounts receivable,~~ cash equivalents, accounts payable, and other accrued liabilities ~~approximate~~are carried at cost, which approximates fair ~~value.~~value, and are classified as Level 1. Debt under the ~~Company’s 2015~~Altra Credit Agreement ~~approximates~~(as defined herein) is classified as Level 2 and is comprised of the Altra Term Loan Facility and the Altra Revolving Credit Facility (both as defined herein). The carrying amount of the Altra Term Loan Facility was $1,010.0 million and the estimated fair value ~~due to~~of the ~~variable rate~~Altra Term Loan Facility was $1,001.2 million at March 31, 2021. There is currently 0 debt under the Altra Revolving Credit Facility. The carrying amount of the Notes (as defined herein) was $400 million and the ~~fact that~~estimated fair value of the ~~agreement~~Notes was ~~renegotiated in December 2016 and there have been no significant changes in our credit rating or pricing of similar debt.~~$429.0 million at March 31, 2021. The Notes are classified as Level 2.

The Company determines the fair value of financial instruments using quoted market prices whenever ~~available.~~available and classified these investments as Level 1. When quoted market prices are not available for various types of financial instruments (such as ~~forwards, options and swaps)~~derivative instruments), the Company uses standard models with market-based inputs, which take into account the present value of estimated future cash flows and the ability of the Company or the financial counterparty to perform. These investments are classified as Level 2. For cross-currency interest rate swaps and ~~cross currency~~interest rate swaps, the significant inputs to these models are interest rate curves for discounting future cash flows and are adjusted for credit risk. For forward foreign currency contracts, the significant inputs are interest rate curves for discounting future cash flows, and exchange rate curves of the foreign currency for translating future cash flows. See additional discussion of the Company’s use of financial instruments including a cross-currency ~~swap~~swaps and interest rate swaps included in Note 15.

In December 2020, the Company invested $5.0 million for a minority equity interest in a privately held manufacturing software company, MTEK Industry AB (“MTEK”), over which the Company does not exert significant influence. The equity investment does not have a readily determinable fair value and does not qualify for the practical expedient to estimate fair value using the net asset value per share. Therefore, in accordance with ASU 2016-01, the Company elected to measure the investment at its cost less impairment, if any, adjusted for observable price changes in orderly transactions for identical or a similar investment of the same issuer. This investment is considered a Level 3 asset based on the lack of observable inputs and is classified within other non-current assets in the consolidated balance sheets. The Company will monitor its equity investment in MTEK for indicators of impairments or upward adjustments on an ongoing basis. If the Company determines that such an indicator is present, an adjustment will be recorded, which will be measured as the difference between the carrying value and estimated fair value. As of March 31, 2021, there were no indicators that support an adjustment to MTEK’s carrying value.

~~The following is a reconciliation of changes in accumulated other comprehensive loss by component for the periods presented:~~

On December 30, 2016, we acquired the shares and certain assets and liabilities of the Stromag business from GKN plc., and as a result, the Company’s unaudited condensed consolidated financial statements reflect Stromag’s results of operations from the beginning of business on December 30, 2016 forward. Stromag is a leading global manufacturer of highly engineered clutches and brakes, couplings, and limit switches for use in a variety of end markets including renewable energy, crane & hoist, and marine. We refer to this transaction as the Stromag Acquisition.

As of September 30, 2017, the allocation of the purchase price for the Stromag Acquisition remains preliminary as the company continues to evaluate the fair value of certain inventories located in foreign jurisdictions. The fair value of all the acquired identifiable assets and liabilities is provisional pending finalization of the Company’s acquisition accounting. The Company believes that such preliminary allocations provide a reasonable basis for estimating the fair values of assets acquired and liabilities assumed, but the Company is waiting for additional information necessary to finalize fair value. The Company recorded certain immaterial measurement period adjustments during the quarter ended September 30, 2017. The preliminary purchase price allocations below include such adjustments.

The ~~excess~~following is a reconciliation of changes in accumulated other comprehensive income/(loss) by component for the ~~purchase price over~~periods presented:

	Gains and (Losses) on Cash Flow Hedges			Defined Benefit Pension Plans			Cumulative Foreign Currency Translation Adjustment			Total
Accumulated Other Comprehensive Loss by Component, January 1, 2020	$	(16.5	)	$	(1.5	)	$	(71.9	)	$	(89.9	)
Change in fair value of interest rate swap, net of tax		(11.7	)		—			—			(11.7	)
Pension adjustments, net of tax		—			(0.1	)		—			(0.1	)
Change in fair value of net investment hedge, net of tax		—			—			31.3			31.3
Foreign currency translation adjustments, net of tax		—			—			(58.4	)		(58.4	)
Net current-period Other Comprehensive Loss		(11.7	)		(0.1	)		(27.1	)		(38.9	)
Accumulated Other Comprehensive Loss by Component, March 31, 2020	$	(28.2	)	$	(1.6	)	$	(99.0	)	$	(128.8	)

Management identified a misstatement related to the classification of foreign currency translation adjustments associated with the net investment hedge for the quarter ended March 31, 2020. As a result, the Company reclassified $31.3 million from Change in fair value of interest rate swap, net of tax in Gains and (losses) on cash flow hedges to Change in fair value of net investment hedge, net of tax in Cumulative foreign currency translation adjustment to reflect the ~~net assets acquired was recorded~~correct presentation in the table above. This adjustment had no effect on the Company’s previously reported consolidated financial statements as ~~goodwill. This goodwill is not deductible for income tax purposes. The Company expects to develop synergies, such as lower cost country sourcing, global procurement, the ability to cross-sell product,~~of and ~~the ability to penetrate certain geographic areas, as a result of the acquisition of Stromag.~~

~~During the second quarter, the Company and the seller completed the working capital adjustment under the sale and purchase agreement which reduced the purchase price by $2.9 million.~~

Customer relationships are subject to amortization which will be amortized on a straight-line basis over their estimated useful lives of 15 years, which represents the anticipated period over which the Company estimates it will benefit from the acquired assets.

~~The following table sets forth the unaudited pro forma results of operations of the Company~~ for the quarter ~~and year~~ended March 31, 2020. Additionally, certain amounts related to ~~date periods ended September 30, 2016, as if~~ the Company had acquired Stromag at the beginning of the period. The pro forma information contains the actual operating results of the Company, including Stromag, adjusted to include the pro forma impact of (i) additional depreciation expense as a result of estimated depreciation based on the fair value of fixed assets and; (ii) additional expense as a result of the estimated amortization of identifiable intangible assets; (iii) additional interest expense for borrowings under the Credit Agreement associated with the Stromag Acquisition and (iv) inventory fair value adjustment. These pro forma amounts do not purport to be indicative of the results that would have actually been obtained if the acquisition occurred at the beginning of the period or that may be obtainedderivative financial instruments were reclassified in the ~~future.~~

~~Notes~~Consolidated Statements of Comprehensive Income to ~~Unaudited Condensed Consolidated Interim Financial Statements~~

Basic earnings per share is based on the weighted average number of shares of common stock outstanding, and diluted earnings per share is based on the weighted average number of shares of common stock outstanding and all potentially dilutive common stock equivalents outstanding. Common stock equivalents are included in the per share calculations when the effect of their inclusion is dilutive.

	Quarter Ended				Year to Date Ended				Quarter Ended
	September 30, 2017		September 30, 2016		September 30, 2017		September 30, 2016		March 31, 2021		March 31, 2020
Net income	$	13,277	$	5,313	$	38,987	$	23,472
Net income/(loss)									$	39.2	$	(116.6	)
Shares used in net income per common share - basic		29,008		25,726		28,912		25,684		64.7		64.5
Dilutive effect of the equity premium on Convertible Notes at the average price of common stock		—		295		—		123
Incremental shares of unvested restricted common stock		66		—		89		6		0.6		—
Shares used in net income per common share - diluted		29,074		26,021		29,001		25,813		65.3		64.5
Earnings per share:
Shares excluded as their inclusion would be anti-dilutive										—		0.1
Earnings/(Loss) per share:
Basic net income	$	0.46	$	0.21	$	1.35	$	0.91	$	0.61	$	(1.81	)
Diluted net income	$	0.46	$	0.20	$	1.34	$	0.91	$	0.60	$	(1.81	)

Inventories at ~~September 30, 2017~~March 31, 2021 and December 31, ~~2016~~2020 consisted of the following:

	September 30, 2017		December 31, 2016		March 31, 2021		December 31, 2020
Raw materials	$	50,976	$	45,507	$	103.4	$	95.2
Work in process		24,359		20,128		23.4		22.1
Finished goods		77,679		74,205		95.9		93.1
	$	153,014	$	139,840	$	222.7	$	210.4

The Company conducts an annual impairment review of goodwill and indefinite-lived intangible assets in the fourth quarter of each year, unless events occur which trigger the need for an interim impairment review. There were no triggering events for the quarter ended March 31, 2021. The 2020 annual goodwill impairment review indicated that the Thomson reporting unit’s fair value exceeded its carrying value by less than 10%. All other reporting units had fair values that exceeded their carrying value by 10% or more.

Changes in goodwill from January 1, ~~2017~~2021 through ~~September 30, 2017~~March 31, 2021 were as follows:

Couplings,
Clutches &
Brakes

Electromagnetic Clutches &
Brakes

Gearing

Total

Net goodwill balance January 1, 2017

$
104,465

$
37,161

$
47,215

$
188,841

Measurement period adjustment related to acquisition of Stromag, including working capital settlement (See Note 6)

$
738

$
113

$
-

$
851

Impact of changes in foreign currency and other

12,378

623

881

13,882

Net goodwill balance September 30, 2017

$
117,581

$
37,897

$
48,096

$
203,574

	Power Transmission Technologies			Automation & Specialty			Total
Goodwill	$	452.4		$	1,314.5		$	1,766.9
Accumulated impairment loss		(31.8	)		(139.1	)		(170.9	)
Balance January 1, 2021	$	420.6		$	1,175.4		$	1,596.0
Impact of changes in foreign currency		(5.6	)		(15.1	)		(20.7	)
Net goodwill balance March 31, 2021	$	415.0		$	1,160.3		$	1,575.3

Other intangible assets as of ~~September 30, 2017~~March 31, 2021 and December 31, ~~2016~~2020 consisted of the following:

	September 30, 2017						December 31, 2016							March 31, 2021						December 31, 2020
	Cost		Accumulated Amortization		Net		Cost		Accumulated Amortization		Net			Cost		Accumulated Amortization		Net		Cost		Accumulated Amortization		Net
Other intangible assets
Intangible assets not subject to amortization:
Tradenames and trademarks(1)	$	54,408	$	—	$	54,408	$	50,416	$	—	$	50,416		$	255.7	$	—	$	255.7	$	259.7	$	—	$	259.7
In-process research and development															16.0		—		16.0		16.0		—		16.0
Intangible assets subject to amortization:
Customer relationships		175,842		70,277	$	105,565		164,406		60,761		103,645			1,204.5		204.3		1,000.2		1,220.2		195.0		1,025.2
Product technology and patents		6,779		5,813	$	966		6,090		5,468		622			210.7		57.4		153.3		211.2		52.5		158.7
Total intangible assets	$	237,029	$	76,090	$	160,939	$	220,912	$	66,229	$	154,683		$	1,686.9	$	261.7	$	1,425.2	$	1,707.1	$	247.5	$	1,459.6

(1) The change in Cost of Tradenames and trademarks is a result of the $8.4 million impairment charge in the quarter ended March 31, 2020 related to the JVS reporting unit, offset by the impact of foreign currency.													(1) The change in Cost of Tradenames and trademarks is a result of the $8.4 million impairment charge in the quarter ended March 31, 2020 related to the JVS reporting unit, offset by the impact of foreign currency.

The Company recorded ~~$2.4~~$17.6 million and ~~$2.1~~$17.5 million of amortization expense in the quarters ended ~~September 30, 2017~~March 31, 2021 and ~~2016 respectively, and recorded $7.1 million and $6.4 million of amortization expense in the year to date periods ended September 30, 2017 and September 30, 2016,~~2020, respectively.

The estimated amortization expense for intangible assets is approximately ~~$2.3~~$53.1 million for the remainder of ~~2017, $9.4~~2021, $70.7 million in each of the next four years and then ~~$66.6~~$817.6 million thereafter.

The contractual warranty period of the Company's products generally ranges from three months to two years with certain warranties extending for longer periods. Estimated expenses related to product warranties are accrued at the time products are sold to customers and are recorded in accruals and other current liabilities on the unaudited condensed consolidated balance ~~sheet.~~sheets. Estimates are established using historical information as to the nature, frequency and average costs of warranty claims.

Changes in the carrying amount of accrued product warranty costs for each of the quarters ended ~~September 30, 2017~~March 31, 2021 and ~~September 30, 2016~~2020 are as follows:

	September 30, 2017			September 30, 2016			March 31, 2021			March 31, 2020
Balance at beginning of period	$	9,158		$	9,468		$	9.6		$	10.0
Accrued current period warranty expense		511			1,732			0.9			1.0
Payments and adjustments		(2,047	)		(2,700	)		(0.8	)		(1.4	)
Balance at end of period	$	7,622		$	8,500		$	9.7		$	9.6

~~Outstanding debt obligations at September 30, 2017 and December 31, 2016 were as follows.~~

Outstanding debt obligations at March 31, 2021 and ~~Restated~~December 31, 2020 were as follows:

On October ~~22, 2015,~~1, 2018 (the “A&S Closing Date”), upon the closing of the combination (the “Fortive Transaction”) of Altra with 4 operating companies from Fortive Corporation’s (“Fortive”) Automation & Specialty platform (the “A&S Business”), the Company assumed $400 million aggregate principal amount of 6.125% senior notes due 2026 (the “Notes”). The Notes will mature on October 1, 2026. Interest on the Notes accrues from October 1, 2018, and the first interest payment date on the Notes was on April 1, 2019. The Notes may be redeemed at the option of the issuer on or after October 1, 2023. The Notes are guaranteed on a senior unsecured basis by the Company and certain of its domestic subsidiaries.

On the A&S Closing Date, the Company entered into a ~~Second Amended and Restated~~new Credit Agreement ~~which may be amended from time to time~~ (the ~~“2015~~“Altra Credit Agreement”). ~~Under the 2015~~The Altra Credit Agreement ~~the~~provides for a seven-year senior secured term loan in an aggregate principal amount of ~~the Company’s prior~~$1,340.0 million (the “Altra Term Loan Facility”) and a five-year senior secured revolving credit facility ~~was increased to $350~~in an aggregate committed principal amount of $300.0 million (the ~~“2015~~“Altra Revolving Credit Facility” and together with the Altra Term Loan Facility, the “Altra Credit Facilities”). The ~~amounts available under the 2015 Revolving Credit Facility can be used for general corporate purposes, including acquisitions, and to repay existing indebtedness. The stated maturity~~proceeds of the ~~2015 Revolving Credit~~Altra Term Loan Facility ~~is October 22, 2020.~~

~~The amounts available under the 2015 Revolving Credit Facility may be drawn upon in accordance with the terms~~were used to (i) consummate Fortive’s transfer of the 2015 Credit Agreement. All amounts outstanding under the 2015 Revolving Credit Facility are due on the stated maturity or such earlier time, if any, required under the 2015 Credit Agreement. The amounts owed under the 2015 Revolving Credit Facility may be prepaid at any time, subject to usual notificationcertain non-U.S assets, liabilities and breakage payment provisions. Interest on the amounts outstanding under the 2015 Revolving Credit Facility is calculated using either an ABR Rate or Eurodollar Rate, plus the applicable margin. The applicable margins for Eurodollar Loans are between 1.25% to 2.00%, and for ABR Loans are between 0.25% and 1.00%. The amounts of the margins are calculated based on either a consolidated total net leverage ratio (as defined in the 2015 Credit Agreement), or the then applicable rating(s) of the Company’s debt and then to the extent as provided in the 2015 Credit Agreement. The rate at December 31, 2015 was 1.5%. A portion of the 2015 Revolving Credit Facility may also be used for the issuance of letters of credit, andentities constituting a portion of the ~~amount~~A&S Business to certain subsidiaries of Altra, and the Altra subsidiaries’ assumption of substantially all of the ~~2015 Revolving Credit Facility is available~~liabilities associated with the transferred assets (the “Direct Sales”), (ii) repay in full and extinguish all outstanding indebtedness for ~~borrowings in certain agreed upon foreign currencies. The 2015 Credit Agreement contains various affirmative and negative covenants and restrictions, which among other things, will require~~borrowed money under the ~~Borrowers~~Company’s previous credit agreement (as defined ~~in the 2015 Credit Agreement) to provide~~herein) and (iii) pay certain ~~financial reports to the Lenders (as defined in the 2015 Credit Agreement), require the Company to maintain certain financial covenants relating to consolidated leverage~~fees, costs, and interest coverage, limit maximum annual capital expenditures, and limit the ability of the Company and its subsidiaries to incur or guarantee additional indebtedness, pay dividends or make other equity distributions, purchase or redeem capital stock or debt, make certain investments, sell assets, engage in certain transactions, and effect a consolidation or merger. The 2015 Credit Agreement also contains customary events of default.

On October 21, 2016, the Company entered into an agreement to amend the 2015 Credit Agreement. This amendment, which became effective upon closing of the purchase of Stromag on December 30, 2016, increased the 2015 Revolving Credit Facility by $75 million to $425 million. The Company used additional borrowings under the increased facility to finance its purchase of Stromag. In addition, the amendment increased the multicurrency sublimit to $250 million and adjusted certain financial covenants. The pricing terms and maturity date under the 2015 Credit Agreement remain unchanged. The Company paid $0.6 million in feesexpenses in connection with the ~~October 2016 amendment, which is recorded in other non-current assets.~~

Asconsummation of ~~September 30, 2017 we had $282.4 million outstanding on~~ the ~~USD tranche~~Fortive Transaction. The proceeds of ~~our 2015~~the Altra Revolving Credit Facility will be used for working capital and general corporate purposes.

The Altra Credit Facilities are guaranteed on a senior secured basis by the Company and certain of its domestic subsidiaries, subject to certain customary exceptions.

Borrowings under the Altra Term Loan Facility will bear interest at a per annum rate equal to a “Eurocurrency Rate” plus 2.00%, in the case of Eurocurrency Rate borrowings, or equal to a “Base Rate” plus 1.00%, in the case of Base Rate borrowings. Borrowings under the Altra Revolving Credit Facility will initially bear interest at a per annum rate equal to a Eurocurrency Rate plus 2.00%, in the case of Eurocurrency Rate borrowings, or equal to a Base Rate plus 1.00%, in the case of Base Rate borrowings, and thereafter will bear interest at a per annum rate equal to a Eurocurrency Rate or Base Rate, as applicable, plus an interest rate spread determined by reference to a pricing grid based on the Company’s senior secured net leverage ratio. In addition, the Company will be required to pay fees that will fluctuate between 0.250% per annum to 0.375% per annum on the unused amount of ~~2.99%. As of September 30, 2017 and December 31, 2016, we had $3.7 million and $4.1 million in letters of credit outstanding, respectively. We had $138.9 million available to borrow under~~ the ~~2015~~Altra Revolving Credit Facility, ~~at September 30, 2017 and may borrow an additional $150 million under certain circumstances.~~

~~In March 2011, the Company issued Convertible Senior Notes (the “Convertible Notes”) due March 1, 2031. The Convertible Notes were guaranteed by~~based upon the Company’s ~~U.S. domestic subsidiaries. Interest~~senior secured net leverage ratio. The interest rate on the ~~Convertible Notes~~Altra Term Loan Facility was ~~payable semi-annually in arrears, on~~2.115% at March ~~1 and September 1 of each year, commencing on September 1, 2011 at an annual rate of 2.75%. Proceeds from the offering were $81.3 million, net of fees and expenses that were capitalized.~~31, 2021.

On December 12, 2016 the Company gave notice to the holders of the Convertible Notes of its intention to redeem all of the Convertible Notes outstanding on January 12, 2017 (the “Redemption Date”), pursuant to the optional redemption provisions in the Indenture. The redemption price for the Convertible Notes was 100% of the principal amount thereof, plus accrued and unpaid interest, if any, to, but not including, the Redemption Date plus a Make-Whole Premium equal to the present values of the remaining scheduled payments of interest on any Convertible Notes through March 1, 2018 (excluding interest accrued to, but excluding, the Redemption Date). In lieu of receiving the redemption price, holders of the Notes could surrender their Convertible Notes for conversion at any time before January 9, 2017. The conversion rate of the Convertible Notes was 39.0809 shares of the Company’s common stock, for each $1,000 of outstanding principal of the Convertible Notes. As of December 31, 2016, Convertible Notes with an outstanding principal of approximately $39.3 million were converted resulting in the issuance of 1.5 million shares of the

The Altra Credit Agreement contains usual and customary representations and warranties, and usual and customary affirmative and negative covenants, including limitations on liens, investments, restricted payments, additional indebtedness and asset sales and mergers. In addition, the Altra Credit Agreement requires that Altra maintain a ~~result~~specified maximum senior secured leverage ratio and a specified minimum interest coverage ratio. The obligations of the ~~conversion, the Company incurred a loss on extinguishment of debt of approximately $1.9 million and the carrying value~~borrowers of the ~~Convertible Notes was $42.9 million~~Altra Credit Facilities under the Altra Credit Agreement may be accelerated upon customary events of default, including non-payment of principal, interest, fees and other amounts, inaccuracy of representation and warranties, violation of covenants, cross default and cross acceleration, voluntary and involuntary bankruptcy or insolvency proceedings, inability to pay debts as they become due, material judgments, ERISA events, actual or asserted invalidity of ~~December 31, 2016. In January 2017, additional Convertible Notes with an outstanding principal of approximately $44.7 million were converted resulting~~security documents or guarantees and change in ~~the issuance of 1.7 million shares of the Company’s common stock, and $0.9 million of Convertible Notes were redeemed for cash.~~ control.

The Company incurred $29.9 million in issuance costs, which are amortized over the term of the debt as an ~~additional loss~~adjustment to the effective interest rate on ~~extinguishment~~the outstanding borrowings.

The Company provided notice to the administrative agent of ~~debt~~the Altra Credit Agreement on March 9, 2020 and March 16, 2020 to draw down $50 million and $50 million, respectively, under the Altra Revolving Credit Facility. At that time, the Company had increased its borrowings under the Altra Revolving Credit Facility as a precautionary action in order to increase its cash position and enhance its financial flexibility during this period of ~~approximately $1.8~~uncertainty in the global markets resulting from COVID-19. On April 14, 2020, the Company provided notice to the administrative agent of the Altra Credit Agreement to repay $50 million ~~during~~outstanding under the ~~quarter~~Altra Revolving Credit Facility. On April 27, 2020 and May 27, 2020, the Company provided notice to the administrative agent to repay $15 million and $35 million, respectively, which were outstanding under the Altra Revolving Credit Facility. As of the period ended March 31, ~~2017. All Convertible Notes were converted or redeemed as of January 12, 2017.~~2021, all outstanding borrowings under the Altra Revolving Credit Facility have been repaid.

~~During 2015, a foreign subsidiary~~As of March 31, 2021, the Company had $1,010.0 million outstanding on the Altra Credit Agreement. As of March 31, 2021 and December 31, 2020, the Company had $4.8 million and $4.5 million in letters of credit outstanding, respectively. The Company had $295.2 million available to borrow under the Altra Credit Facilities at March 31, 2021.

The Company’s subsidiaries in Europe have entered into ~~a mortgage with a bank for €1.5 million, or $1.7 million,~~certain long-term fixed rate term loans that are generally secured by ~~its facility in Heidelberg, Germany~~local property, plant and equipment. The debt has interest rates that range from 1.79% to ~~replace its previously existing mortgage. The mortgage has an interest rate of 1.79%~~2.5%, ~~which is payable in~~with various quarterly and monthly installments through ~~August 2023. The mortgage had a remaining principal balance of € 1.1 million, or $1.3 million, at September 30, 2017.~~2028.

During 2015, a foreign subsidiary of the Company entered into a mortgage with a bank for €6.0 million, or $6.7 million, secured by its facility in Esslingen, Germany. The mortgage has an interest rate of 2.5% per year, which is payable in annual interest payments of €0.1 million, or $0.1 million, to be paid in monthly installments. The mortgage had a remaining principal balance of €6.0 million, or $7.1 million, at September 30, 2017. The principal portion of the mortgage will be due in a lump-sum payment in May 2019.

During the quarter ended March 31, 2016, a foreign subsidiary of the Company entered in to a loan with a bank to equip its facility in Zlate Moravce, Slovakia. As of September 30, 2017, the total principal outstanding was €2.1 million, or $2.5 million, and is guaranteed by land security at its parent company facility in Esslingen, Germany. The loan is due in installments from 2016 through 2020, with an interest rate of 1.95%.

During 2015, a foreign subsidiary of the Company entered into a mortgage with a bank for €2.1 million, or $2.3 million, secured by its facility in in Angers, France. The mortgage has an interest rate of 1.85% per year which is payable in monthly installments from June 2016 until May 2025. The mortgage had a balance of €1.7 million, or $2.0 million, at September 30, 2017.

The Company leases certain equipment under ~~capital~~finance lease arrangements, whose obligations are included in both short-term and long-term debt. ~~Capital~~Finance lease obligations amounted to approximately $0.2 million and $0.3 million at ~~September 30, 2017~~March 31, 2021 and ~~approximately $0.4 million at~~ December 31, ~~2016. Assets subject to capital leases~~2020, respectively. Finance lease right of use assets are included in property, plant and equipment with the related amortization recorded as depreciation expense.

~~Certain of our foreign subsidiaries maintain overdraft agreements with financial institutions. There were no borrowings as of September 30, 2017 or December 31, 2016 under any of~~ Finance lease liabilities are included in current and non-current other liabilities on the ~~overdraft agreements.~~Company’s consolidated balance sheets.

~~The Company’s 2004 Equity Incentive Plan (the “2004 Plan”) permitted~~Common Stock

Effective October 1, 2018, the ~~grant~~Company amended its Articles of ~~various forms~~Incorporation to increase the number of authorized shares of Altra common stock ~~based compensation~~from 90.0 million shares to ~~our officers~~120.0 million shares. As of March 31, 2021 and ~~senior level employees. The 2004 Plan expired in 2014 and, upon expiration,~~December 31, 2020, there were 750,576 shares subject to outstanding awards under the 2004 Plan. The 2014 Omnibus Incentive Plan (the “2014 Plan”) was approved by the Company’s shareholders at its 2014 annual meeting. The 2014 Plan provides for various forms of stock based compensation to our directors, executive personnel64,770,540 and ~~other key employees and consultants. Under the 2014 Plan, the total number of~~64,676,567 shares of common stock ~~available for delivery pursuant~~issued and outstanding, respectively.

On December 20, 2006, the Company amended and restated its certificate of incorporation authorizing 10.0 million shares of undesignated Preferred Stock (“Preferred Stock”). The Preferred Stock may be issued from time to time in one or more classes or series, the ~~grant~~shares of ~~awards (“Awards”) was originally 750,000. At~~each class or series to have such designations and powers, preferences, rights, qualifications, limitations and restrictions as determined by the Company’s ~~2017 Annual Meeting, its shareholders approved amendments to the 2014 Plan which, among other things, made an additional 750,000 shares~~Board of ~~common stock~~Directors. There was 0 Preferred Stock issued or outstanding at March 31, 2021 or December 31, 2020.

The 2014 Omnibus Incentive Plan (the “2014 Plan”) was approved by the Company’s stockholders at the Company’s 2014 Annual Meeting of Stockholders. The 2014 Plan provides for ~~grant under the 2014 Plan. Shares~~various forms of stock-based compensation to our ~~common stock subject to Awards awarded under the 2004 Plan~~directors, executive personnel and ~~outstanding as of the effective date of~~other key employees and consultants. Under the 2014 Plan, ~~(except for substitute awards) that terminate without being exercised, expire, are forfeited or canceled, are exchanged for Awards that did not involve~~the remaining total number of shares of common stock are not issued on the stock settlement of a stock appreciation right, are withheld by the Company or tendered by a participant (either actually or by attestation) to pay an option exercise price or to pay the withholding tax on any Award, or are settled in cash in lieu of shares will again be available for ~~Awards under~~delivery pursuant to the ~~2014 Plan.~~grant of awards was 4.1 million as of March 31, 2021.

The restricted ~~shares~~stock and restricted stock units issued pursuant to the 2014 Plan generally vest ratably over a period ranging from immediately to five years from the date of grant, provided, that the vesting of the restricted ~~shares~~stock or restricted stock units may accelerate upon the occurrence of certain events. Common stock awarded under the 2014 Plan is generally subject to restrictions on transfer, repurchase rights, and other limitations and rights as set forth in the applicable award agreements. ~~The fair value of the shares repurchased are measured based on the share price on the date of grant.~~

The 2014 Plan permits the Company to grant, among other things, restricted stock, restricted stock units, stock options and performance share awards to key ~~employees and other persons who make significant contributions to the success~~employees. Certain awards include vesting based upon achievement of ~~the Company. The restrictions and vesting schedule for restricted stock granted under the 2014 Plan are determined by the Personnel and~~specified performance criteria. Compensation ~~Committee of the Board of Directors.~~

~~Stock-based compensation~~ expense recorded (in selling, general and administrative expense) during the ~~year to date periods~~quarters ended ~~September 30, 2017~~March 31, 2021 and ~~September 30, 2016,~~2020 was ~~$4.5~~3.5 million and ~~$3.4~~3.3 million, respectively. The Company recognizes stock-based compensation expense on a straight-line basis for the shares vesting ratably under the plan and uses the graded-vesting method of recognizing stock-based compensation expense for the performance share awards based on the probability of the specific performance metrics being achieved over the requisite service period.

~~The following table sets forth the activity of the Company’s restricted stock and performance share grants in the year to date period ended September 30, 2017:~~

Total remaining unrecognized compensation cost ~~was $6.3~~is approximately $30.6 million as of ~~September 30, 2017, which~~March 31, 2021, and will be recognized over a weighted average remaining period of 3three years.

The fair market value of the shares for which the restrictions have lapsed during the year to date period ended September 30, 2017 was $5.6 million. Restricted shares granted are valued based on the fair market value offollowing table summarizes the stock ~~on the date of grant.~~

~~In May 2014, our board of directors approved a share repurchase program (the “2014 Program”) authorizing the buyback of up to $50.0 million of~~option activity under the Company’s ~~common stock. Under~~plan for the ~~2014 program,~~quarter ended March 31, 2021:

The following table summarizes the ~~Company was authorized to purchase shares on~~Restricted Stock Unit activity under the ~~open market, through block trades, in privately negotiated transactions, in compliance with SEC Rule 10b-18 (including through Rule 10b5-1 plans), or in any other appropriate manner. The timing of~~Company’s plan for the shares repurchased was at the discretion of management and depended on a number of factors, including price, market conditions and regulatory requirements. Shares acquired through the repurchase program were retired.quarter ended March 31, 2021:

On October 19, 2016, our board of directors approved a new share repurchase program authorizing the buyback of up to $30.0 million of the Company's common stock through December 31, 2019. This plan replaces the 2014 Program which was terminated. The Company expects to purchase shares on the open market, through block trades, in privately negotiated transactions, in compliance with SEC Rule 10b-18 (including through Rule 10b5-1 plans), or in any other appropriate manner. The timing of the shares repurchased will be at the discretion of management and will depend on a number of factors, including price, market conditions and regulatory requirements. Shares acquired through the repurchase program will be retired. The Company retains the right to limit, terminate or extend the share repurchase program at any time without prior notice. ~~The Company expects to fund any further~~

~~repurchases of its common stock through a combination of cash on hand and cash generated by operations. During~~

The following table summarizes the ~~year to date period ended September 30, 2017, the Company did not repurchase any of its common stock~~Performance Share Award activity under the ~~share repurchase program.~~

~~The Company declared a dividend of $0.17 per share of common stock related to~~Company’s plan for the quarter ended ~~September 30, 2017 which was accrued in the balance sheet at September 30, 2017.~~ March 31, 2021:

~~Future declarations of quarterly cash dividends are subject to approval by the Board of Directors and~~

See Note 12, Stockholders’ Equity, to the ~~Board’s continuing determination that the declaration of dividends are in the best interest~~audited consolidated financial statements of the ~~Company’s stockholders and are in compliance with all laws and agreements of~~Company's Annual Report on Form 10-K for the ~~Company applicable to the declaration and payment of cash dividends.~~

year ended December 31, 2020 for further information regarding stock-based compensation.

From time to time, the Company has initiated various restructuring programs and incurred severance and other restructuring costs.

During 2015, the Company commenced a restructuring plan (“2015 Altra Plan”) as a result of weak demand in Europe and to make certain adjustments to improve business effectiveness, reduce the number of facilities and streamline the Company's cost structure. The actions taken pursuant to the 2015 Altra Plan included reducing headcount, facility consolidations and related asset impairments, and limiting discretionary spending to improve profitability.

~~The following table details restructuring charges incurred by segment for the periods presented under the 2015 Altra Plan.~~

The amounts for the quarter ended September 30, 2017 were comprised of approximately $0.1 million in consolidation costs. The amounts for the year to date period ended September 30, 2017 were comprised of approximately $0.9 million in severance, $1.2 million in consolidation costs, and $1.1 million in other restructuring, and are classified in the accompanying unaudited condensed consolidated statement of income as restructuring costs.

~~During the quarter ended September 30,~~ 2017, the Company commenced a ~~new~~ restructuring plan (“2017 Altra Plan”) as a result of the Company’s acquisition of Stromag ~~acquisition~~ and to rationalize its global renewable energy business. The actions taken pursuant to the 2017 Altra Plan included reducing headcount, facility consolidations and the elimination of certain costs. The Company did not incur any costs as a result of the 2017 Altra Plan during the quarter ended March 31, 2021.

During 2019, the Company commenced a restructuring plan (“2019 Altra Plan”) to drive efficiencies, reduce the number of facilities and optimize its operating margin. The Company expects to incur approximately $4 - $6 million in restructuring expenses under the 2019 Altra Plan over the next two years, primarily related to headcount reductions and plant consolidations. The expense for the quarter ended March 31, 2021 was $0.9 million and was primarily comprised of severance costs.

The following ~~table details~~is a reconciliation of the accrued restructuring ~~charges incurred by segment for~~costs between January 1, 2021 and March 31, 2021:

The following is a reconcilation of the ~~periods presented under the 2017 Altra Plan.~~accrued restructuring costs between January 1, 2020 and March 31, 2020:

Quarter Ended

Year to Date Period Ended

September 30,
2017

September 30,
2016

September 30,
2017

September 30,
2016

Couplings, Clutches & Brakes

$
631

$
—

$
631

$
—

Electromagnetic Clutches & Brakes

—

—

—

—

Gearing

—

—

—

—

Corporate (1)

—

—

—

—

Total

$
631

$
—

$
631

$
—

	2017 Altra Plan			2019 Altra Plan			Total All Plans
Balance at January 1, 2020	$	1.5		$	2.6		$	4.1
Restructuring expense incurred		0.2			1.4			1.6
Cash payments		(0.4	)		(1.4	)		(1.8	)
Balance at March 31, 2020		1.3			2.6			3.9

The amounts for the quarter ended September 30, 2017 were comprised of approximately $0.4 million in severance and $0.2 million in consolidation costs, and are classified in the accompanying unaudited condensed consolidated statement of income as restructuring costs.

The following is a reconciliation of restructuring expense by segment for the ~~accrued restructuring costs between January 1, 2017 and September 30, 2017.~~quarter ended March 31, 2021:

The following is a reconciliation of restructuring expense by segment for the quarter ended March 31, 2020:

The total accrued restructuring reserve as of ~~September 30, 2017 relates~~March 31, 2021, and as of March 31, 2020 relate primarily to severance and consolidation costs ~~to be paid to former employees which are expected to be paid during~~under the 2017 Altra Plan and the 2019 Altra Plan and are recorded in accruals and other current liabilities on the accompanying unaudited condensed consolidated balance sheet. The Company does not expect to incur any additional material restructuring expenses related to the 2015 Altra Plan. The company expects to incur approximately $2.0 to $4.0 million in expense under the 2017 Plan through 2019.

The Company sold its entity in Changzhou China and obtained proceeds of approximately $3.2 million at the close of the transaction. There was no additional gain or loss recorded on the sale of the building associated with this entity which was classified as assets held for sale.

The ~~Company currently operates through three business~~internal reporting structure used by our Chief Operating Decision Maker (“CODM”) to assess performance and allocate resources determines the basis for our reportable operating segments. Our CODM is our Chief Executive Officer, and he evaluates operations and allocates resources based on a measure of income from operations. Our operations are organized in 2 reporting segments that are aligned with key product types and end markets ~~served:~~served, Power Transmission Technologies (“PTT”) and Automation & Specialty (“A&S”):

Couplings are the interface between two shafts, which enable power to be transmitted from one shaft to the other. Clutches in this segment are devices which use mechanical, hydraulic, pneumatic, or friction type connections to facilitate engaging or disengaging two rotating members. Brakes are combinations of interacting parts that work to slow or stop machinery. Products in this segment are generally used in heavy industrial applications and energy markets.

Products in this segment include brakes and clutches that are used to electronically slow, stop, engage or disengage equipment utilizing electromagnetic friction type connections. Products in this segment are used in industrial and commercial markets including agricultural machinery, material handling, motion control, and turf & garden.

Segment financial information and a reconciliation of segment results to unaudited condensed consolidated results are as follows:

Quarters Ended September 30,

Year to Date Period Ended September 30,

2017

2016

2017

2016

Net Sales:

Couplings, Clutches & Brakes

$
110,109

$
77,446

$
327,310

$
231,225

Electromagnetic Clutches & Brakes

58,304

50,680

187,463

165,083

Gearing

48,368

47,023

144,545

145,038

Inter-segment eliminations

(2,158
)

(2,017
)

(5,903
)

(5,087
)
Net sales

$
214,623

$
173,132

$
653,415

$
536,259

Income from operations:

Segment earnings:

Couplings, Clutches & Brakes

$
12,679

$
6,596

$
33,031

$
20,441

Electromagnetic Clutches & Brakes

6,138

6,589

21,894

20,120

Gearing

5,689

5,650

17,804

17,280

Restructuring

(680
)

(3,397
)

(3,776
)

(6,591
)
Corporate expenses (1)

(2,553
)

(5,069
)

(6,869
)

(9,729
)
Income from operations

$
21,273

$
10,369

$
62,084

$
41,521

Other non-operating (income) expense:

Net interest expense

$
1,811

$
2,815

$
5,547

$
8,615

Other non-operating expense (income), net

696

45

30

(438
)
Loss on extinguishment of convertible debt

—

—

1,797

—

2,507

2,860

7,374

8,177

Income before income taxes

18,766

7,509

54,710

33,344

Provision for income taxes

5,489

2,196

15,723

9,872

Net income

$
13,277

$
5,313

$
38,987

$
23,472

	Quarter Ended
	March 31, 2021			March 31, 2020
Net Sales:
Power Transmission Technologies	$	221.0		$	216.7
Automation & Specialty		252.1			218.6
Inter-segment eliminations		(1.0	)		(1.1	)
Net sales	$	472.1		$	434.2
Income/(loss) from operations:
Segment earnings:
Power Transmission Technologies	$	27.8		$	25.7
Automation & Specialty		41.4			(118.7	)
Corporate expenses (1)		(3.2	)		(3.4	)
Restructuring costs		(0.9	)		(1.6	)
Income/(loss) from operations	$	65.1		$	(98.0	)
Other non-operating expense:
Net interest expense		16.9			17.4
Other non-operating expense, net		(1.5	)		(1.5	)
Total non-operating expense	$	15.4		$	15.9
Income/(loss) before income taxes		49.7			(113.9	)
Provision for income taxes		10.5			2.7
Net income/(loss)	$	39.2		$	(116.6	)

Quarter Ended

Year to Date Period Ended

September 30, 2017

September 30, 2016

September 30, 2017

September 30, 2016

Depreciation and amortization:

Couplings, Clutches & Brakes

$
5,387

$
4,028

$
15,658

$
11,485

Electromagnetic Clutches & Brakes

1,274

1,176

3,690

3,501

Gearing

1,776

1,862

5,077

5,261

Corporate

851

791

2,478

2,372

Total depreciation and amortization

$
9,288

$
7,857

$
26,903

$
22,619

September 30, 2017

December 31, 2016

Total assets:

Couplings, Clutches & Brakes

$
570,266

$
511,934

Electromagnetic Clutches & Brakes

181,766

169,507

Gearing

139,039

147,829

Corporate (2)

34,960

40,554

Total assets

$
926,031

$
869,824

	Quarter Ended
	March 31, 2021		March 31, 2020
Depreciation and amortization:
Power Transmission Technologies	$	8.0	$	8.2
Automation & Specialty		22.0		23.3
Corporate		0.7		0.6
Total depreciation and amortization	$	30.7	$	32.1

	Net Sales								Net Sales
	Quarter Ended				Year to Date Period Ended				Quarter Ended
	September 30, 2017		September 30, 2016		September 30, 2017		September 30, 2016		March 31, 2021		March 31, 2020
North America (primarily U.S.)	$	101,569	$	99,995	$	331,945	$	316,957	$	247.0	$	245.3
Europe		87,866		54,344		256,142		165,694
Asia and other		25,188		18,793		65,328		53,608
Europe excluding Germany										84.9		74.8
Germany										51.0		52.5
China										64.1		38.4
Asia and other excluding China										25.1		23.2
Total	$	214,623	$	173,132	$	653,415	$	536,259	$	472.1	$	434.2

Net sales to third parties are attributed to the geographic regions based on the country in which the shipment originates. Amounts attributed to the geographic regions for property, plant and equipment are based on the location of the entity, which holds such assets.

Financial instruments, which are potentially subject to counter party performance and concentrations of credit risk, consist primarily of trade accounts receivable. The Company manages these risks by conducting credit evaluations of customers prior to delivery or commencement of services. When the Company enters into a sales contract, collateral is normally not required from the customer. Payments are typically due within 30 days of billing. An allowance for potential credit losses is maintained, and losses have historically been within management’s expectations. While the Company did not have any customers that represented total sales greater than 10% for each of the quarters ended September 30, 2017 and 2016, the Gearing business had one customer that approximated 10% of total sales for that segment during the quarter ended September 30, 2017.

The Company is also subject to counter party performance risk of loss in the event of non-performance by counterparties to financial instruments, such as cash and investments. Cash and cash equivalents are held by well-established financial institutions and invested in AAA rated mutual funds. The Company is exposed to swap counterparty credit risk with well-established financial institutions.

The Company ~~enters into contractual derivative arrangements to~~may manage changes in market conditions related to interest on debt obligations and foreign currency ~~exposures. Derivative~~exposures by entering into derivative instruments, ~~utilized during the period include~~including interest rate ~~swap agreements~~ and foreign currency ~~contracts.~~swap agreements. All derivative instruments are recognized as either assets or liabilities on the balance sheet at fair value at the end of each period. ~~The counterparties to the Company's contractual derivative agreements are all major international financial institutions.~~ The Company ~~is exposed to credit loss in~~determines the ~~event~~fair value of ~~nonperformance by these counterparties. The~~financial instruments using quoted market prices whenever available. When quoted market prices are not available for various types of financial instruments (such as forwards, options and swaps), the Company ~~continually monitors its positions~~uses standard models with market-based inputs, which take into account the present value of estimated future cash flows and the ability of Altra or the financial counterparty to perform. For cross-currency interest rate swaps, the significant inputs are interest rate curves for discounting future cash flows, and exchange rate curves of the foreign currency for translating future cash flows. For interest rate swaps, the significant inputs to these models are interest rate curves for discounting future cash flows that are adjusted for credit ~~ratings~~risk. Both cross-currency interest rate swaps and interest rate swaps are Level 2 investments. Refer to Note 5 for a description of ~~its counterparties, and does not anticipate nonperformance by~~ the ~~counterparties.~~fair value levels. For designated hedging relationships, the Company formally documents the hedging relationship ~~and its risk management objective and strategy for undertaking~~consistent with the ~~hedge, the hedging instrument, the hedged item, the nature~~requirements of the risk being hedged, how the hedging instrument's effectiveness in offsetting the hedged risk will be assessed prospectively and retrospectively, and a description of the method of measuring ineffectiveness. The Company also formally assesses, both at the hedge's inception and on an ongoing basis, whether the derivatives that are used in hedging transactions are highly effective in offsetting cash flows of hedged items.ASC 815, Derivatives.

~~The~~In December 2018, the Company ~~is exposed~~entered into cross-currency swap agreements to ~~foreign currency~~hedge its net investment in Euro-denominated assets against future volatility in the exchange rate between the U.S. dollar and ~~interest rate cash flow exposure related to non-functional currency~~the Euro. By doing so, the Company synthetically converted a portion of its U.S. dollar-based long-term debt ofinto Euro-denominated long-term debt. At inception, the ~~Company’s wholly owned Dutch subsidiary. To manage this foreign currency and interest rate cash flow exposure,~~cross-currency swaps were designated as net investment hedges.

For net investment hedges, changes in the fair value of the effective portion of the derivatives’ gains or losses are reported as foreign currency translation gains or losses in accumulated other comprehensive income (loss) (“AOCIL”). The gains or losses on derivative instruments reported in AOCIL are reclassified to earnings in the period in which earnings are affected by the underlying item, such as a disposal or substantial liquidations of the entities being hedged. During the first quarter of 2020, the Company ~~entered into a~~terminated the cross-currency interest rate ~~swap that converts $100.0 million of U.S. dollar denominated floating interest payments to functional currency (euro) fixed interest payments during~~swaps. The Company received the life of the hedging instrument. In addition, the Company has two cross-currency interest rate swaps that convert an additional $70.0 million of the U.S. dollar denominated floating interest payments to functional currency (euro) floating interest payments during the life of the hedging instruments. The effective period of onecash value of the cross-currency interest rate swaps of approximately $56.2 million upon termination. In addition, the Company paid the interest owed and received the interest due, resulting in the ~~amount~~recognition of ~~$30~~approximately $3.3 million ~~(the “Initial Swap”) that~~in net interest income, and paid termination fees of approximately $0.9 million. At March 31, 2021, the Company ~~entered~~had a gain in toAOCIL of approximately $44.8 million, net of $11.4 million of tax. That balance will remain in AOCIL until the period in which earnings are affected by the underlying item, such as ~~of December 21, 2016 expired as of June 30, 2017. The Company net settled the Initial Swap and~~ a ~~new $30 million cross-currency swap transaction was entered into which will amortize down to $20 million after six-months. The effective period~~disposal or substantial liquidations of the second of these two cross-currency interest rate swaps in the amount of $40 million expires on December 31, 2018. As changes in foreign exchange and interest rates impact the future cash flow of interest payments, the hedges are intended to offset changes in cash flows attributable to interest rate and foreign exchange movements.entities being hedged.

The Company designated the $100.0 million swap as a cash flow hedge, with the effective portion of the gain or loss on the derivative reported as a component of other comprehensive income and reclassified into earnings in the same period or periods during which the hedged transaction impacts earnings. There were no amounts recorded for ineffectiveness for the periods reported herein related to the cross-currency interest rate swaps. Changes in the fair value of the derivatives that are not designated as a cash flow hedge are recorded in other operating (income) expense, net.

Changes in the fair value of a derivative that is designated as and meets all the required criteria for a cash flow hedge are recorded in accumulated other comprehensive income and reclassified into earnings as the underlying hedged item affects earnings. As of September 30, 2017, approximately $0.3 million of net unrealized gains related to the cross-currency interest rate swaps were included in accumulated other comprehensive income.

InIn January 2017, the Company entered into an interest rate swap agreement ~~designed~~ to fix the variable interest rate payable on a portion of its outstanding borrowings. This interest rate swap matured on January 31, 2020.Additionally, in December 2018, the Company entered into an interest rate swap agreement designed to manage the cash flow risk caused by interest rate changes on the forecasted interest payments expected to occur related to a portion of its outstanding borrowings under the ~~2015~~Altra Credit ~~Agreement, for a notional value of $50.0 million, at 1.625%. The effective date was January 31, 2017 and the maturity date is January 31, 2020.~~Agreement.

The interest rate swap agreement was designed to manage exposure to interest rates on the Company’s variable rate ~~indebtedness. The Company recognizes all derivatives~~indebtedness and was recognized on ~~its~~the balance sheet at fair value. The Company ~~has~~ designated this interest rate swap agreement as a cash flow ~~hedge. Changes~~hedge and changes in the fair value of the swap ~~will be~~were recognized in other comprehensive income until the hedged items ~~are~~were recognized in earnings. ~~Hedge ineffectiveness, if any, associated with the swap will be reported by~~

During 2020, the Company ~~in interest expense. As of September 30, 2017, approximately $35 thousand of unrealized gain related to~~terminated the interest rate swap ~~was included~~agreement. The Company paid the cash value of the interest rate swaps of approximately $34.7 million upon termination. In addition, the Company paid the interest owed and received the interest due, resulting in ~~accumulated other comprehensive income.~~the recognition of approximately $0.1 million in net interest expense, and paid termination fees of approximately $0.1 million. At March 31, 2021, the Company had a loss in AOCIL of approximately $18.0 million, net of $4.6 million of tax benefit. The loss on the interest rate swap reported in AOCIL will be reclassified to earnings in future periods when the hedged transaction affects earnings or if it is determined that it is probable that the hedged transaction will not occur. The Company reclassified $2.4 million, net of $0.7 million of tax benefit, of non-cash interest expense from AOCIL to earnings for the quarter ended March 31, 2021.

~~The following table summarizes outstanding swaps which the Company has recorded at September 30, 2017.~~

Initial US$

Date

Derivative

Notional

Entered

Financial

Amount

Floating Leg

Floating Leg

Settlement

Effective
into

Instrument

(thousands)

(swap counterparty)

Fixed Rate

(Company)

Dates

Period of swap
12/21/2016

Cross currency interest rate swap

$
100,000

Variable rate 1-month USD Libor plus 1.50% to 3/31/17 and 1.75% thereafter

1.027%
EUR

N/A

Monthly on the last banking day of each month commencing December 30, 2016

12/23/2016 - 12/31/2019
12/21/2016

Cross currency interest rate swap

40,000

Variable rate 1-month USD Libor plus 1.50% to 3/31/17 and 1.75% thereafter

N/A

Variable rate 1-month EURIBOR, floored at 0.00%, plus 0.920%

Monthly on the last banking day of each month commencing December 30, 2016

12/23/2016 - 12/31/2018
6/28/2017

Cross currency interest rate swap

30,000

Variable rate 1-month USD Libor plus 1.75% thereafter

N/A

Variable rate 1-month EURIBOR, floored at 0.00%, plus 1.11%

Monthly on the last banking day of each month commencing July 31, 2017

6/30/2017 - 12/31/2017
1/31/2017

Interest rate swap

50,000

Variable rate 1-month USD Libor

1.625%
USD

N/A

Monthly on the last banking day of each month commencing February 28, 2017

1/31/2017 - 1/31/2020

The following table summarizes the ~~location and fair value, using Level 2 inputs (see Note 4 for a description of the fair value levels),~~balance of the Company's ~~derivatives designated and not~~derivative instruments designated as ~~hedging instruments in the Unaudited Condensed Consolidated Balance Sheets~~cash flow hedges (in ~~thousands).~~

The following table summarizes the location of (gain) loss reclassified from Accumulated other comprehensive loss into earnings for derivatives designated as hedging instruments and the location of (gain) loss for our derivatives not designated as hedging instruments in the Consolidated Statements of Income (in thousands).

The Company is involved in various pending legal proceedings arising out of the ordinary course of business. These proceedings primarily involve commercial claims, product liability claims, personal injury claims, and workers’ compensation claims. ~~None of these legal proceedings are expected to have a material adverse effect on the results of operations, cash flows, or financial condition of the Company. Wi~~thWith respect to these proceedings, management believes that the Company will prevail, has adequate insurance coverage or has established appropriate reserves to cover potential liabilities. Any costs that management estimates may be paid related to these proceedings or claims are accrued when the liability is considered probable and the amount can be reasonably estimated. There can be no assurance, however, as to the ultimate outcome of any of these matters, and if all or substantially all of these legal proceedings were to be determined adversely to the Company, there could be a material adverse effect on the results of operations, cash flows, or financial condition of the Company. We have established loss provisions for matters in which losses are probable and can be reasonably estimated. ~~There were no material amounts accrued in the accompanying unaudited condensed consolidated balance sheet for potential litigation as of September 30, 2017 or December 31, 2016.~~ For matters where a reserve has not been established and for which we believe a loss is reasonably possible, as well as for matters where a reserve has been recorded but for which an exposure to loss in excess of the amount accrued is reasonably possible, we believe that such losses, individually and in the aggregate, will not have a material effect on our unaudited condensed consolidated financial statements.

Our estimates regarding potential losses and materiality are based on our judgment and assessment of the claims utilizing currently available information. Although we will continue to reassess our reserves and estimates based on future developments, our objective assessment of the legal merits of such claims may not always be predictive of the outcome and actual results may vary from our current estimates. We will continue to consider the applicable guidance in ASC 450-20, based on the facts known at the time of our future filings, as it relates to legal contingencies, and will adjust our disclosures as may be required under the guidance.

There were 0 material amounts accrued in the accompanying unaudited condensed consolidated balance sheets for potential litigation as of March 31, 2021 or December 31, 2020.

The Company also risks exposure to product liability claims in connection with products it has sold and those sold by businesses that the Company acquired. Although in some cases third parties have retained responsibility for product liability claims relating to products manufactured or sold prior to the acquisition of the relevant business and in other cases the persons from whom the Company has acquired a business may be required to indemnify the Company for certain product liability claims subject to certain caps or limitations on indemnification, the Company cannot assure that those third parties will in fact satisfy their obligations with respect to liabilities retained by them or their indemnification obligations. If those third parties become unable to or otherwise do not comply with their respective obligations including indemnity obligations, or if certain product liability claims for which the Company is obligated were not retained by third parties or are not subject to these indemnities, the Company could become subject to significant liabilities or other adverse consequences. Moreover, even in cases where third parties retain

responsibility for product liability claims or are required to indemnify the Company, significant claims arising from products that have been acquired could have a material adverse effect on the Company’s ability to realize the benefits from an acquisition, could result in the reduction of the value of goodwill that the Company recorded in connection with an acquisition, or could otherwise have a material adverse effect on the Company’s business, financial condition, or operations.

There is contamination at some of ~~an Amendment~~the Company’s current facilities, primarily related to historical operations at those sites, for which the Company could be liable for the investigation and remediation under certain environmental laws. The potential for contamination also exists at other of the Company’s current or former sites, based on historical uses of those sites. The Company currently is not undertaking any material remediation or investigations and the costs or liability in connection with potential contamination conditions at these facilities cannot be predicted at this time because the potential existence of contamination has not been investigated or not enough is known about the environmental conditions or likely remedial requirements. Currently, other parties with contractual liability are addressing or have plans or obligations to address those contamination conditions that may pose a material risk to human health, safety or the environment. In addition, while the Company attempts to evaluate the risk of liability associated with these facilities at the time the Company acquired them, there may be environmental conditions currently unknown to the ~~Altra Industrial Motion, Inc. Retirement Plan (the “Pension Plan”)~~

~~Effective June 30, 2017,~~Company relating to prior, existing or future sites or operations or those of predecessor companies whose liabilities the Company ~~amended~~may have assumed or acquired which could have a material adverse effect on the ~~Altra Industrial Motion, Inc. Retirement Plan (the “Pension Plan”), its frozen U.S. defined benefit pension plan, to terminate the Pension Plan effective as of June 30, 2017.~~ Company’s business.

The Company ~~has commenced the plan termination process and~~is being indemnified, or expects to ~~distribute a portion~~be indemnified, by third parties subject to certain caps or limitations on the indemnification, for certain environmental costs and liabilities associated with certain owned or operated sites. Accordingly, based on the indemnification and the experience with similar sites of the ~~Pension Plan assets by the end of 2017 and the remainder in the first quarter of 2018. Upon regulatory approval and the distribution of plan assets,~~environmental consultants who the Company ~~expects~~has hired, the Company does not expect such costs and liabilities to ~~recognize~~have a ~~loss up~~material adverse effect on its business, operations or earnings. The Company cannot assure you, however, that those third parties will in fact satisfy their indemnification obligations. If those third parties become unable to, or otherwise do not, comply with their respective indemnity obligations, or if certain contamination or other liability for which the Company is obligated is not subject to these indemnities, the Company could become subject to significant liabilities.

From time to time, the Company is notified that it is a ~~total of approximately $8.0 million during~~potentially responsible party and may have liability in connection with off-site disposal facilities. To date, the ~~fourth quarter of 2017 and first quarter of 2018 associated with~~Company has generally resolved matters involving off-site disposal facilities for a nominal sum but there can be no assurance that the ~~plan termination. The loss will include up to $1.1 million in cash required to terminate the pension plan and the remainder~~Company will be ~~non-cash~~able to resolve pending or future matters in ~~nature. The unrecognized loss will be triggered upon the distribution of Pension Plan assets.~~

On ~~October 17, 2017~~April 27, 2021, the Company declared a dividend of ~~$0.17~~$0.08 per share for the quarter ended ~~December 31, 2017,~~June 30, 2021 , payable on ~~January 3, 2017~~July 2, 2021 to ~~shareholders~~stockholders of record as of ~~December~~June 18, ~~2017.~~2021.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

This Quarterly Report on Form 10-Q contains forward-looking statements, within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which reflect the Company’s current estimates, expectations and projections about the Company’s future results, performance, prospects and opportunities. Forward-looking statements include, among other things, the information concerning the Company’s possible future results of operations including revenue, costs of goods sold, gross margin, future profitability, future economic improvement, business and growth strategies, financing plans, expected leverage levels, the Company’s competitive position and the effects of competition, the projected growth of the industries in which we operate, and the Company’s ability to consummate strategic acquisitions and other transactions. In addition, all statements regarding the anticipated effects of the novel coronavirus, or COVID-19, pandemic and the responses thereto, including the pandemic’s impact on general economic and market conditions, as well as on our business, customers, end markets, results of operations and financial condition and anticipated actions to be taken by management to sustain the Company during the economic uncertainty caused by the pandemic and related governmental and business actions, as well as other statements that are not strictly historic in nature are forward looking. Forward-looking statements include statements that are not historical facts and can be identified by forward-looking words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” ~~“expect,~~“expect” “forecast,” “intend,” “plan,” “may,” “project,” “should,” “will,” “would,” ~~“project,” “forecast”~~ and similar ~~expressions.~~expressions or variations. These forward-looking statements are based upon information currently available to the Company and are subject to a number of risks, uncertainties, and other factors that could cause the Company’s actual results, performance, prospects, or opportunities to differ materially from those expressed in, or implied by, these forward-looking statements.

Important factors that could cause the Company’s actual results to differ materially from the results referred to in the forward-looking statements the Company makes in this report include:

ALL FORWARD-LOOKING STATEMENTS SPEAK ONLY AS OF THE DATE OF THIS REPORT. EXCEPT AS REQUIRED BY LAW, WE UNDERTAKE NO OBLIGATION TO PUBLICLY UPDATE OR RELEASE ANY REVISIONS TO THESE FORWARD-LOOKING STATEMENTS TO REFLECT ANY EVENTS OR CIRCUMSTANCES AFTER THE DATE OF THIS REPORT OR TO REFLECT THE OCCURRENCE OF UNANTICIPATED EVENTS. ALL SUBSEQUENT WRITTEN AND ORAL FORWARD-LOOKING STATEMENTS ATTRIBUTABLE TO US OR ANY PERSON ACTING ON THE COMPANY’S BEHALF ARE EXPRESSLY QUALIFIED IN THEIR ENTIRETY BY THE CAUTIONARY STATEMENTS CONTAINED OR REFERRED TO IN THIS SECTION AND IN OUR RISK FACTORS SET FORTH (1) IN THE SECTION TITLED “RISK FACTORS,” SET FORTH IN PART II, ITEM 1A OF THIS QUARTERLY REPORT ON FORM 10-Q; (2) IN PART I, ITEM 1A OF THE COMPANY’S ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED DECEMBER 31, ~~2016, AND IN OTHER REPORTS~~2020, FILED WITH THE ~~SECURITIES~~SEC ON FEBRUARY 26, 2021; AND ~~EXCHANGE COMMISSION BY~~(3) IN THE ~~COMPANY.~~COMPANY’S OTHER SEC FILINGS.

The following discussion of the financial condition and results of operations of Altra Industrial Motion Corp. and its subsidiaries should be read together with (1) the ~~audited~~unaudited condensed consolidated financial statements of Altra Industrial Motion Corp. and its subsidiaries and the related notes and other financial information included elsewhere in this Quarterly Report on Form 10-Q and (2) the audited consolidated financial statements of Altra Industrial Motion Corp. and its subsidiaries and the related notes and management’s discussion and analysis of financial conditions and results of operations included in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2020. The following discussion includes forward-looking statements. For a discussion of important factors that could cause actual results to differ materially from the results referred to in the forward-looking statements, see “Forward-Looking Statements” and “Risk Factors” in this Quarterly Report on Form 10-Q and “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020. Unless the context requires otherwise, the terms “Altra,” “Altra Industrial Motion Corp.,” “the Company,” “we,” “us,” and “our” refer to Altra Industrial Motion Corp. and its subsidiaries.

We are a leading global designer, producer and marketer of a wide range of electromechanical power transmission ~~and~~ motion control products with a presence in over 70 countries. Our global sales and marketing network includes over 1,000 direct OEM customers and over 3,000 distributor outlets. Our product portfolio includes industrial clutches and brakes, enclosed gear drives, open gearing, couplings, engineered bearing assemblies, linear components, gear motors, and other related(“PTMC”) products. Our ~~products serve~~technologies are used in various motion related applications and across a wide variety of ~~end markets including energy, general industrial, material handling, mining, transportation~~high-volume manufacturing and ~~turf~~non-manufacturing processes in which reliability and ~~garden.~~ precision are critical to avoid costly down time and enhance the overall efficiency of operations.

We ~~primarily sell~~market our products tounder well recognized and established brands, which have been in existence for an average of over 85 years. We serve a ~~wide range~~diversified group of ~~OEMs~~customers comprised of over 1,000 direct original equipment manufacturers (“OEMs”) including GE, Honeywell and ~~through long-standing~~Siemens, and also benefit from established, long-term relationships with leading industrial distributors, ~~such as Motion Industries,~~including Applied Industrial Technologies, Grainger, Kaman Industrial Technologies and ~~W.W. Grainger.~~

~~The Company currently operates through three business segments that are aligned~~Motion Industries. Many of our customers operate globally across a large number of industries, ranging from transportation, turf and agriculture, energy and mining to factory automation, medical and robotics. Our relationships with ~~key product types~~these customers often span multiple decades, which we believe reflects the high level of performance, quality and ~~end markets served:~~

~~Gears are utilized to reduce the speed and increase the torque of an electric motor or engine to the level required to drive a particular piece of equipment. Gears produced~~service we deliver, supplemented by the ~~Company are primarily utilized in industrial applications.~~

~~The following tables show the percentage of net sales and operating income generated by each~~breadth of our ~~three segments~~offering, vast geographic footprint and our ability to rapidly develop custom solutions for ~~the quarters and year to date periods ended September 30, 2017 and 2016:~~

Our ~~Internet address~~website is www.altramotion.com. By following the link “Investor Relations” and then “SEC ~~filings”~~Filings” on our ~~Internet~~ website, ~~we make available, free of charge,~~you can access our Annual ~~Report~~Reports on Form 10-K, our Quarterly Reports on Form 10-Q, ~~our~~ Current Reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which we make available free of charge, as soon as reasonably practicable after such forms are filed with or furnished to the ~~Securities and Exchange Commission.~~SEC. We are not including the information contained on or available through our website as a part of, or incorporating such information by reference into, this Quarterly Report on Form 10-Q.

Our future financial performance depends, in large part, on conditions in the markets that we serve and on conditions in the U.S., European, and global economies in general.

During the quarter ended ~~September 30, 2017,~~March 31, 2021, we ~~saw continued improvement in certain of our~~experienced demand acceleration across several end markets, ~~that previously had been challenged. As our markets strengthen,~~including transportation, factory automation and specialty machinery, and increasing strength in most of the geographies we ~~expect~~serve. We continued to ~~benefit increasingly from our work during the past few years on our facility consolidation,~~manage supply chain challenges to minimize customer disruptions and ~~operational excellence initiatives. Moreover,~~control costs. Our topline performance and ongoing focus on cost management led to strong earnings and cash flow from operations which allowed us to continue to pay down debt.

The COVID-19 pandemic continues to affect the global economy and business environment. In the first quarter, the Company’s Pandemic Response Team continued to identify and assess risks and develop countermeasures following guidance from national, state and local governmental and health authorities. In addition, the Company’s Business Continuity Task Force continued to work to ensure continuity of supply for its customers. During the first quarter, Altra experienced minimal supply chain disruption and all material manufacturing facilities continued to be operational.

The COVID-19 pandemic and its effects on the economic environment remain extremely fluid and it is difficult to predict with certainty what unforeseen circumstances may develop as we ~~believe~~progress through the remainder of the year. As a result, we will continue to proceed cautiously by managing our cost structure and cash flows and prioritizing debt reduction. In addition, we are ~~now in a~~implementing strategic plans to best position Altra to ~~capitalize on the positive momentum in the industrial economy by driving growth initiatives. To this end, our sales~~adapt to these changing conditions and ~~engineering teams are targeting specific strategic end markets with focused activities~~ to ~~generate new opportunities. We~~ continue to ~~be encouraged by the progress of the integration of~~serve our ~~Stromag acquisition~~customers and ~~we have already experienced an increase in cross-selling opportunities. We continue to seek further acquisitions, but remain highly disciplined in that pursuit.~~community.

The preparation of our unaudited condensed consolidated financial statements and related disclosures in conformity with generally accepted accounting principles ~~generally accepted~~ in the United States (“GAAP”) requires management to make judgments, assumptions and estimates that affect our reported amounts of assets, revenues and expenses, as well as related disclosures of contingent assets and liabilities. We base our estimates on past experiences and other assumptions we believe to be appropriate, and we evaluate these estimates on an on-going basis. See the discussion of critical accounting policies in our Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2020. There have been no changes in the identification or application of the Company’s critical accounting policies during the quarter ended ~~September 30, 2017.~~

See Part 1, Notes to Unaudited Condensed Consolidated Interim Financial Statements, Note 3 – Recent Accounting Standards.

	Quarter Ended						Year to Date Period Ended						Quarter Ended
	September 30, 2017			September 30, 2016			September 30, 2017			September 30, 2016			March 31, 2021			March 31, 2020
Net sales	$	214,623		$	173,132		$	653,415		$	536,259		$	472.1		$	434.2
Cost of sales		145,610			118,957			446,109			369,254			300.4			281.2
Gross profit		69,013			54,175			207,306			167,005			171.7			153.0
Gross profit percentage		32.2	%		31.3	%		31.7	%		31.1	%		36.4	%		35.2	%
Selling, general and administrative expenses		41,009			36,142			123,012			105,548			89.8			87.1
Impairment of Goodwill and Intangible Asset														—			147.5
Research and development expenses		6,051			4,267			18,434			13,345			15.9			14.8
Restructuring costs		680			3,397			3,776			6,591			0.9			1.6
Income from operations		21,273			10,369			62,084			41,521			65.1			(98.0	)
Interest expense, net		1,811			2,815			5,547			8,615			16.9			17.4
Other non-operating income (loss), net		696			45			30			(438	)
Loss on extinguishment of debt		—			—			1,797			—
Income before income taxes		18,766			7,509			54,710			33,344
Other non-operating expense/(income), net														(1.5	)		(1.5	)
Income/(loss) before income taxes														49.7			(113.9	)
Provision for income taxes		5,489			2,196			15,723			9,872			10.5			2.7
Net income	$	13,277		$	5,313			38,987			23,472
Net income/(loss)													$	39.2		$	(116.6	)

Quarter Ended ~~September 30, 2017~~March 31, 2021 compared with Quarter Ended ~~September 30, 2016~~March 31, 2020

Amounts in thousands, except percentage data	Quarter-Ended
Amounts in millions, except percentage data										Quarter Ended
	September 30, 2017		September 30, 2016		Change		%			March 31, 2021		March 31, 2020		Change		%
Net sales	$	214,623	$	173,132	$	41,491		24.0	%	$	472.1	$	434.2	$	37.9		8.7	%

Net SalesThe increase in net sales during the quarter ended March 31, 2021 is primarily due to the strength in heavy duty class 8 truck sales in the United States and China, as well as improvements in the agriculture and medical device end markets. Foreign exchange had a favorable impact on net sales of $14.8 million, primarily driven by the Euro. The increase in sales was also due to price, which had a favorable impact of $3.0 million for the quarter ended March 31, 2021.

Gross ProfitGross profit increased during the quarter ended March 31, 2021, primarily due to strength in the heavy duty class 8 truck markets in the United States and China, as well as improvements in the agriculture and medical device end markets. Changes in foreign exchange had a favorable impact on gross profit of $5.6 million, primarily driven by the Euro. The increase in gross profit was also due to price, which had a favorable impact of $3.0 million for the quarter ended March 31, 2021.

Restructuring costs. During the quarter ended September 30, 2017, was due to the acquisition of Stromag, price increases, higher sales levels in several end markets and the favorable effect of changes in foreign exchange rates of $2.5 million. Of the increase in sales, approximately $34.9 million relates to the inclusion of additional saleswe commenced a restructuring plan (“2017 Altra Plan”) as a result of ~~the~~Altra’s acquisition of Stromag for the quarter. In addition, price increases contributed $1.7 million to the increase during the quarter. The rest of the increase related to a recovery in sales levels in various end markets in the Couplings, Clutches, and Brakes business segment.

Gross profit as a percentage of sales increased during the quarter ended September 30, 2017 primarily due to improvements realized from our consolidation and cost saving efforts as well as a modest improvement in some of our more profitable end markets.

The increase in SG&A is primarily due to the inclusion of SG&A related to the Stromag business. This amount is partially offset by a decrease in year over year US healthcare costs and certain reductions as a result of our plant consolidations.

~~The increase in R&D is due to the inclusion of Stromag for the quarter ended September 30, 2017.~~

~~During 2015, the Company adopted a restructuring plan (“2015 Altra Plan”) in response to weak demand~~ and to ~~make certain adjustments to improve business effectiveness, reduce the number of facilities and streamline the Company’s cost structure.~~rationalize our global renewable energy business. The actions taken pursuant to the ~~2015~~2017 Altra Plan included reducing headcount, facility consolidations and ~~limiting discretionary spending to improve profitability. Approximately $1.9 million~~the elimination of ~~the decrease is related to activity~~certain costs. The total 2017 Altra Plan savings are in ~~the Couplings, Clutches and Brakes segment not present in the current quarter under the 2015 Altra Plan. The Company does~~line with our expectations. We do not expect to incur any additional material costs as a result of the ~~2015~~2017 Altra Plan.

During 2019, we commenced a restructuring plan (“2019 Altra Plan”) to drive efficiencies, reduce the number of facilities and optimize our operating margin. We expect to incur $4 - $6 million in restructuring expenses under the 2019 Altra Plan over the next two years, primarily related to headcount reductions and plant consolidations. We achieved savings of $3.2 million during the quarter ended ~~September 30, 2017,~~March 31, 2021 under the Company commenced a new restructuring plan (“2017 Altra Plan”) as a result of the Stromag acquisition and to rationalize its global renewable energy business. The actions taken pursuant to the 20172019 Altra Plan ~~include reducing headcount, facility consolidations~~ and estimate additional future savings during 2021 to be approximately $3.7 million. The cost savings for the ~~elimination~~quarter ended March 31, 2021 were recognized as reductions in SG&A and Cost of ~~certain costs. Approximately $0.6~~Sales of approximately $1.7 million ~~of the expense in the current quarter is related to activity in the Couplings, Clutches~~ and ~~Brakes segment under the 2017 Altra Plan. The company expects to incur approximately $2.0 to $4.0~~$1.5 million, ~~in additional expense through 2019 related to the 2017 Altra Plan.~~respectively.

Interest expenseInterest expense decreased ~~significantly during~~for the quarter ~~as a result of~~ended March 31, 2021 compared to the conversion and redemption of our convertible notes and the favorable impact of the cross currency interest rate swaps despite the higher borrowing under our Credit Facility for the Stromag Acquisition.

~~Other non-operating expense increased~~prior year period primarily due to ~~foreign currency transaction gains~~the impact of debt paydowns of approximately $174.0 million since the first quarter of 2020, which resulted in lower outstanding borrowings and ~~losses arising from changes~~lower average interest rates. We expect our interest expense in ~~exchange rates related primarily~~2021 to ~~the Euro, British Pound, and Chinese Renminbi.~~continue to decrease as additional principal payments on our debt are made.

Provision for Income TaxesThe provision for income tax as a percentage of income before income taxes ~~was flat~~increased for the quarter ended ~~September 30, 2017~~March 31, 2021 as compared to the quarter ended ~~September 30, 2016.~~

~~Year to Date Ended September 30, 2017 compared with Year to Date Ended September 30, 2016~~

The increase in sales during the year to date period ended September 30, 2017 was due to the acquisition of Stromag, price increases, and higher sales levels in several end markets partially offset by the effect of changes in foreign exchange rates of $5.4 million. Of the increase in sales, approximately $103.0 million relates to the inclusion of additional sales as a result of the acquisition of Stromag. In addition, price increases contributed $4.9 million to the increase. The rest of the increase related to a recovery in sales levels in various end markets in the Couplings, Clutches, and Brakes business segment

Gross profit as a percentage of sales increased slightly during the year to date period ended September 30, 2017 primarily as a result of our plant consolidations, price increases, and improving end markets. The increase in gross profit was partially offset by the impact of acquired inventory related to the Stromag acquisition in the amount of $2.3 million which was recorded at fair value rather than cost.

~~The increase in SG&A is primarily due to the inclusion of SG&A related to the Stromag business.~~

During 2015, the Company adopted a restructuring plan (“2015 Altra Plan”) in response to weak demand and to make certain adjustments to improve business effectiveness, reduce the number of facilities and streamline the Company’s cost structure. The actions taken pursuant to the 2015 Altra Plan included reducing headcount and limiting discretionary spending to improve

profitability. Approximately $1.8 million, $0.8 million, and $0.5 million of the restructuring costs, associated with the 2015 Altra Plan, were related to the Couplings, Clutches and Brakes, Gearing, and Corporate, respectively. The Company does not expect to incur any additional material costs as a result of the 2015 Plan. During the quarter ended September 30, 2017, the Company commenced a new restructuring plan (“2017 Altra Plan”) as a result of the Stromag acquisition and to rationalize its global renewable energy business. The actions taken pursuant to the 2017 Altra Plan include reducing headcount, facility consolidations and the elimination of certain costs. Approximately $0.6 million of the expense in the current quarter is related to activity in the Couplings, Clutches and Brakes segment under the 2017 Altra Plan. The company expects to incur approximately $2.0 to $4.0 million in additional expense through 2019 related to the 2017 Altra Plan.

Interest expense decreased significantly during the period as a result of the conversion and redemption of our convertible notes and the favorable impact of the cross currency interest rate swaps despite the higher borrowing under our 2015 Revolving Credit Facility for the Stromag Acquisition.

Other non-operating expense increased primarily due to foreign currency transaction gains and losses arising from changes in exchange rates related primarily to the Euro, British Pound, and Chinese Renminbi.

March 31, 2020. The provision for income tax as a ~~percentage~~percent of income before income taxes ~~decreased~~during the quarter ended March 31, 2020 was impacted by a $139.1 million non-cash impairment charge recorded at the JVS reporting unit in the United States and China. The increase in the 2021 provision for income tax as a percent of income before income taxes is due to the impact of $1.5 million of accrued withholding tax as a result of a pending dividend from one of our foreign subsidiaries. This was partially offset by a $0.7 million tax benefit as a result of a stock compensation vesting event that occurred in the first quarter of 2021. We expect our provision for income taxes before discrete items to be approximately 21% to 23% for the full year to date period ended September 30, 2017 as compared to the year to date period ended September 30, 2016. This decrease is a combined result of the income in China associated with the closure of the Company’s Changzhou facility which was offset by previously recognized net operating losses, and the adoption of FASB Accounting Standards Update 2016-09, Compensation - Stock Compensation: Improvements to Employee Share-Based Payment Accounting ("ASU 2016-09") on January 1, 2017. Income tax expense included a benefit of $0.6 million arising from a cash tax deduction on restricted stock awards that vested in 2017.2021.

Quarters Ended September 30,

Year to date periods Ended
September 30,

2017

2016

2017

2016

Net Sales:

Couplings, Clutches & Brakes

$
110,109

$
77,446

$
327,310

$
231,225

Electromagnetic Clutches & Brakes

58,304

50,680

187,463

165,083

Gearing

48,368

47,023

144,545

145,038

Intra-segment eliminations

(2,158
)

(2,017
)

(5,903
)

(5,087
)
Net sales

$
214,623

$
173,132

$
653,415

$
536,259

Income from operations:

Segment earnings:

Couplings, Clutches & Brakes

$
12,679

$
6,596

$
33,032

$
20,441

Electromagnetic Clutches & Brakes

6,138

6,589

21,894

20,120

Gearing

5,689

5,650

17,804

17,280

Restructuring

(680
)

(3,397
)

(3,776
)

(6,591
)
Corporate expenses (1)

(2,553
)

(5,069
)

(6,870
)

(9,729
)
Income from operations

$
21,273

$
10,369

$
62,084

$
41,521

Net sales in the ~~Couplings, Clutches & Brakes~~Power Transmission Technologies segment were ~~$110.1~~$221.0 million in the quarter ended ~~September 30, 2017, an~~March 31, 2021. The increase of approximately ~~$32.7~~$4.3 million or ~~42.2%,~~2.0% from the quarter ended ~~September 30, 2016. Approximately $28.8 million of the increase was~~March 31, 2020 is primarily due to the ~~inclusion of sales from~~strength in our distribution channel, and the ~~newly acquired Stromag business~~turf and garden and agriculture end markets. The improvements in these end markets was offset by declines in oil and gas, defense and mining end markets. In addition, changes in foreign exchange for the ~~quarter. The remainder~~quarter ended March 31, 2021 had a favorable impact on net sales of $8.3 million, primarily driven by the Euro. Price also had a favorable impact on net sales for the quarter ended March 31, 2021 of $1.8 million. Income from operations for the quarter ended March 31, 2021 was $27.8 million, an increase of 8.2%, which is primarily driven by the increase ~~was due to a modest recovery~~ in certain of our more profitable end markets. Segment operating income increased approximately $6.1 million compared to the prior period primarily as a result of the addition of Stromag and plant consolidations.sales.

Net sales in the ~~Electromagnetic Clutches~~Automation & ~~Brakes~~Specialty segment were ~~$58.3~~$252.1 million in the quarter ended ~~September 30, 2017,~~March 31, 2021. The increase for the quarter ended March 31, 2021 of approximately $33.5 million, or 15.3%, was primarily due to strength in heavy duty class 8 truck sales in the United States and China, as well as improvements in the medical device and factory automation end markets. In addition, changes in foreign exchange for the quarter ended March 31, 2021 had a favorable impact of $6.5 million, primarily driven by the Euro. Price had a favorable impact on net sales for the quarter ended March 31, 2021 of $1.2 million. The Automation & Specialty segment had income from operations for the quarter ended March 31, 2021 of $41.4 million, an increase of ~~approximately $7.6~~$160.1 million, or ~~15.0%~~135.9%, ~~from~~primarily due to the non-cash impairment charges of $8.4 million and $139.1 million for indefinite-lived intangible assets and goodwill, respectively, recorded at the JVS reporting unit during the quarter ended September 30, 2016. Approximately $6.0 million of the increase was due to the inclusion of sales from the newly acquired Stromag business in the quarter. Segment operating income decreased $0.5 million compared to the prior period primarily as a result of the impact of foreign exchange.March 31, 2020.

Net sales in the Gearing segment were $48.4 million in the quarter ended September 30, 2017, which were similar to the prior year. Segment operating income was consistent compared to the prior period.

We finance our capital and working capital requirements through a combination of cash flows from operating activities and borrowings under ~~our 2015~~the Altra Revolving Credit Facility ~~(defined below)~~(as defined herein). At March 31, 2021, we had the ability under the Altra Revolving Credit Facility to borrow an additional $295.2 million subject to satisfying customary conditions. We expect that our primary ongoing requirements for cash will be for working capital, debt service, capital expenditures, acquisitions, pensions, ~~dividends~~ and ~~share repurchases.~~ dividends.

On October 1, 2018 (the “A&S Closing Date”), we consummated the Fortive Transaction. The aggregate purchase price for the A&S Business was approximately $2,855.7 million, subject to certain post-closing adjustments, and consisted of (i) $1,400.0 million of cash transferred to Fortive and (ii) shares of Altra common stock received by Fortive shareholders valued at approximately $1,455.7 million. The value of the common stock was based on the closing stock price on the A&S Closing Date of $41.59. We financed the cash portion of the Fortive Transaction with the Altra Credit Facilities (as defined herein).

We believe, based on current and projected levels of cash flows from operating activities, together with our ability to borrow under the Altra Revolving Credit Facility, that we have sufficient liquidity to make required payments of interest on our debt, to make amortization payments under the Altra Credit Facilities , to fund our operating needs, to fund working capital and capital expenditure requirements and to comply with the financial ratios in our debt agreements. It is difficult, however, to predict the severity and duration of the economic decline due to the impact of the COVID-19 pandemic but we have taken several proactive measures to protect our balance sheet and strengthen our liquidity position, as discussed above under “Business Outlook.”

In the event additional funds are needed for operations, we could ~~borrow additional funds available under our existing 2015 Revolving Credit Facility, request an expansion by up to $150 million of the amount available to be borrowed under the 2015 Credit Agreement,~~ attempt to ~~secure~~obtain new debt ~~attempt to~~and/or refinance ~~our loans under the 2015 Credit Agreement,~~existing debt, or attempt to raise capital in the equity markets. ~~As of September 30, 2017, we have the ability under our 2015 Revolving Credit Facility to borrow an additional $138.9 million based on current availability calculations.~~ There can be no assurance, however, that additional debt ~~financing will be available on commercially acceptable terms, if at all. Similarly, there can be no assurance that~~or equity financing will be available on commercially acceptable terms, if at all.

On September 26, 2018, Stevens Holding Company, Inc., a wholly owned subsidiary of the Company (“Stevens Holding”), announced the pricing of $400.0 million aggregate principal amount of Stevens Holding’s 6.125% senior notes due 2026 (the “Notes”) in a private debt offering pursuant to Rule 144A and ~~Restated~~Regulation S under the Securities Act of 1933 (the “Private Placement”). On October 1, 2018, the Private Placement closed, and Stevens Holding sold $150.0 million aggregate principal amount of the Notes (the “Primary Notes”) and an unaffiliated selling securityholder sold $250.0 million aggregate principal amount of the Notes (the “Selling Securityholder Notes”). The Notes will mature on October 1, 2026. Interest on the Notes accrues from October 1, 2018, and the first interest payment date on the Notes was April 1, 2019. The Notes may be redeemed at the option of Stevens Holding on or after October 1, 2023, in the manner and at the redemption prices specified in the indenture governing the Notes, plus accrued and unpaid interest thereon, if any, to, but excluding, the date of redemption. The Notes are guaranteed on a senior unsecured basis by Altra and certain of its domestic subsidiaries.

The unaffiliated selling securityholder received the Selling Securityholder Notes from Fortive prior to the closing of the Private Placement in exchange for certain outstanding Fortive debt held or acquired by the unaffiliated selling securityholder. Stevens Holding used the net proceeds of the Primary Notes to fund a dividend payment to Fortive prior to the consummation of the Merger, and Stevens Holding did not receive any proceeds from the sale of the Selling Securityholder Notes.

On ~~October 22, 2015,~~ the ~~Company~~A&S Closing Date, Altra entered into ~~a Second Amended and Restated~~the Altra Credit Agreement ~~by and among the Company,~~with certain subsidiaries of Altra, Industrial Motion Netherlands, B.V. (“Altra Netherlands”), one of the Company’s foreign subsidiaries (collectively with the Company, the “Borrowers”), the lenders party to the Second Amended and Restated Credit Agreement from time to time (collectively, the “Lenders”), J.P. Morgan Securities LLC, Wells Fargo Securities, LLC, and KeyBanc Capital Markets, Inc., as joint lead arrangers and joint bookrunners, and JPMorgan Chase Bank, N.A., as administrative agent and collateral agent, and a syndicate of lenders. The Altra Credit Agreement provides for a seven-year senior secured term loan to Altra in an aggregate principal amount of $1,340.0 million (the ~~“Administrative Agent”~~“Altra Term Loan Facility”), and a five-year senior secured revolving credit facility provided to ~~be guaranteed through a Guarantee Agreement by~~Altra and certain ~~domestic~~of its subsidiaries in an aggregate committed principal amount of $300.0 million (the “Altra Revolving Credit Facility” and together with the Altra Term Loan Facility, the “Altra Credit Facilities”). The proceeds of the ~~Company (each a “Guarantor”~~Altra Term Loan Facility were used to (i) consummate the Direct Sales, (ii) repay in full and ~~collectively~~extinguish all outstanding indebtedness for borrowed money under the ~~“Guarantors”; the Guarantors collectively~~Company’s previous credit agreement and (iii) pay certain fees, costs, and expenses in connection with the ~~Borrowers,~~consummation of the ~~“Loan Parties”), and which~~Fortive Transaction. Any proceeds of the Altra Term Loan Facility not so used may ~~be amended from time to time (the “2015 Credit Agreement”).~~

Under the 2015 Credit Agreement, the amount of our Revolving Credit Facility was increased to $350 million (the “2015 Revolving Credit Facility”). The amounts available under the 2015 Revolving Credit Facility can be used for general corporate ~~purposes, including acquisitions, and to repay existing indebtedness.~~

purposes. The ~~stated maturity~~proceeds of the ~~2015~~Altra Revolving Credit Facility ~~is October 22, 2020.~~will be used for working capital and general corporate purposes.

The ~~amounts available~~Altra Credit Facilities are guaranteed on a senior secured basis by Altra and by each direct or indirect wholly owned domestic subsidiary of Altra, subject to certain customary exceptions.

Borrowings under the ~~2015~~Altra Term Loan Facility will bear interest at a per annum rate equal to a “Eurocurrency Rate” plus 2.00%, in the case of Eurocurrency Rate borrowings, or equal to a “Base Rate” plus 1.00%, in the case of Base Rate borrowings. Borrowings under the Altra Revolving Credit Facility ~~may~~will initially bear interest at a per annum rate equal to a Eurocurrency Rate plus 2.00%, in the case of Eurocurrency Rate borrowings, or equal to a Base Rate plus 1.00%, in the case of Base Rate borrowings, and thereafter will bear interest at a per annum rate equal to a Eurocurrency Rate or Base Rate, as applicable, plus an interest rate spread determined by reference to a pricing grid based on Altra’s senior secured net leverage ratio. In addition, Altra will be ~~drawn upon in accordance with~~required to pay fees that will fluctuate between 0.250% per annum to 0.375% per annum on the ~~terms~~unused amount of the ~~2015~~Altra Revolving Credit ~~Agreement. All amounts~~Facility, based upon Altra’s senior secured net leverage ratio. The interest rate on the Altra Term Loan Facility was 2.115% at March 31, 2021.

The Company provided notice to the administrative agent of the Altra Credit Agreement on March 9, 2020 and March 16, 2020 to draw down $50 million and $50 million, respectively, under the Altra Revolving Credit Facility. At that time, the Company had increased its borrowings under the Altra Revolving Credit Facility as a precautionary action in order to increase its cash position and enhance its financial flexibility during this period of uncertainty in the global markets resulting from COVID-19. On April 14, 2020, the Company provided notice to the administrative agent of the Altra Credit Agreement to repay $50 million outstanding under the ~~2015~~Altra Revolving Credit Facility. On April 27, 2020 and May 27, 2020, the Company provided notice to the administrative agent to repay $15 million and $35 million, respectively, which were outstanding under the Altra Revolving Credit Facility. As of the period ended March 31, 2021, all outstanding borrowings under the Altra Revolving Credit Facility ~~are due on the stated maturity or such earlier time, if any, required under the 2015 Credit Agreement. The amounts owed under the 2015 Revolving Credit Facility may be prepaid~~

at any time, subject to usual notification and breakage payment provisions. Interest on the amounts outstanding under the credit facilities is calculated using either an ABR Rate or Eurodollar Rate, plus the applicable margin. The applicable margins for Eurodollar Loans are between 1.25% to 2.00%, and for ABR Loans are between 0.25% and 1.00%. The amounts of the margins are calculated based on either a consolidated total net leverage ratio (as defined in the 2015 Credit Agreement), or the then applicable rating(s) of the Company’s debt if and then to the extent as provided in the 2015 Credit Agreement. A portion of the 2015 Revolving Credit Facility may also be used for the issuance of letters of credit, and a portion of the amount of the 2015 Revolving Credit Facility is available for borrowings in certain agreed upon foreign currencies. The 2015 Credit Agreement contains various affirmative and negative covenants and restrictions, which among other things, will require the Borrowers to provide certain financial reports to the Lenders, require the Company to maintain certain financial covenants relating to consolidated leverage and interest coverage, limit maximum annual capital expenditures, and limit the ability of the Company and its subsidiaries to incur or guarantee additional indebtedness, pay dividends or make other equity distributions, purchase or redeem capital stock or debt, make certain investments, sell assets, engage in certain transactions, and effect a consolidation or merger. The 2015 Credit Agreement also contains customary events of default.

On October 21, 2016, the Company entered into an agreement to amend its 2015 Credit Agreement. This amendment, which became effective upon closing of Altra’s purchase of Stromag, which was December 30, 2016, increased the Company’s 2015 Revolving Credit Facility by $75 million to $425 million. The Company borrowed additional funds under the increased facility to finance its purchase of Stromag. The amendment also reset the possible expansion of up to $150 million of additional future loan commitments. In addition, the amendment increased the multicurrency sublimit to $250 million and adjusted certain financial covenants.

Pursuant to an Omnibus Reaffirmation and Ratification and Amendment of Collateral Documents entered into on October 22, 2015 in connection with the 2015 Credit Agreement by and among the Company, the Loan Parties and the Administrative Agent (the “Ratification Agreement”), the Loan Parties (exclusive of the foreign subsidiary Borrower) have reaffirmed their obligations to the Lenders under the Pledge and Security Agreement dated November 20, 2012 (the “Pledge and Security Agreement”), pursuant to which each Loan Party pledges, assigns and grants to the Administrative Agent, on behalf of and for the ratable benefit of the Lenders, a security interest in all of its right, title and interest in, to and under all personal property, whether now owned by or owing to, or after acquired by or arising in favor of such Loan Party (including under any trade name or derivations), and whether owned or consigned by or to, or leased from or to, such Loan Party, and regardless of where located, except for specific excluded personal property identified in the Pledge and Security Agreement (collectively, the “Collateral”). Notwithstanding the foregoing, the Collateral does not include, among other items, more than 65% of the capital stock of the first tier foreign subsidiaries of the Company. The Pledge and Security Agreement contains other customary representations, warranties and covenants of the parties. The 2015 Credit Agreement provides that the obligation to grant the security interest can cease upon the obtaining of certain corporate family credit ratings for the Company, but the obligation to grant a security interest is subject to subsequent reinstatement if the ratings are not maintained as provided in the 2015 Credit Agreement.

Pursuant to the Ratification Agreement, the Loan Parties (other than the foregoing subsidiary Borrower) have also reaffirmed their obligations under each of the Patent Security Agreement and a Trademark Security Agreement in favor of the Administrative Agent dated November 20, 2012 (the “2012 Security Agreements”) pursuant to which each of the Loan Parties signatory thereto pledges, assigns and grants to the Administrative Agent, on behalf of and for the ratable benefit of the Lenders, a security interest in all of its right, title and interest in, to and under all registered patents, patent applications, registered trademarks and trademark applications owned by such Loan Parties.

In connection with the reaffirmation of the Pledge and Security Agreement, certain of the Loan Parties delivered a new Patent Security Agreement and a new Trademark Security Agreement in favor of the Administrative Agent pursuant to which each of the Loan Parties signatory thereto pledges, assigns and grants to the Administrative Agent, on behalf of and for the ratable benefit of the Lenders, a security interest in all of its right, title and interest in, to and under all registered patents, patent applications, registered trademarks and trademark applications owned by such Loan Parties and not covered by the 2012 Security Agreements.been repaid.

As of ~~September 30, 2017 and December 31,2016 we~~March 31, 2021, the Company had ~~$282.4 million and $313.6~~$1,010.0 million outstanding on ~~our 2015 Revolving~~the Altra Credit ~~Facility, respectively.~~Agreement. As of ~~September 30, 2017~~March 31, 2021 and December 31, ~~2016, we~~2020, the Company had ~~$3.7~~$4.8 million and ~~$4.1~~$4.5 million in letters of credit outstanding, respectively. WeThe Company had ~~$138.9~~$295.2 million available to borrow under the ~~2015~~Altra Credit Facilities at March 31, 2021.

Revolving borrowings and issuances of letters of credit under the Altra Revolving Credit Facility ~~at September 30, 2017. On October 21, 2016, the Company entered into a First Amendment~~are subject to the ~~Second Amended~~satisfaction of customary conditions, including the accuracy of representations and ~~Restated~~warranties and the absence of defaults.

~~We were in compliance in all material respects with all~~Agreement contains usual and customary representations and warranties, and usual and customary affirmative and negative covenants, including limitations on liens, investments, restricted payments, additional indebtedness and asset sales and mergers. In addition, the Altra Credit Agreement requires that Altra maintain a specified maximum senior secured leverage ratio and a specified minimum interest coverage ratio. The obligations of the ~~indenture governing~~borrowers of the ~~2015~~Altra Credit Facilities under the Altra Credit Agreement ~~at September 30, 2017.~~

In March 2011, the Company issued Convertible Senior Notes (the “Convertible Notes”) due March 1, 2031. The Convertible Notes were guaranteed by the Company’s U.S. domestic subsidiaries. Interest on the Convertible Notes was payable semi-annually in arrears, on March 1 and September 1may be accelerated upon customary events of ~~each year, commencing on September 1, 2011 at an annual rate~~default, including non-payment of ~~2.75%. Proceeds from the offering were $81.3 million, net of~~principal, interest, fees and ~~expenses that were capitalized.~~other amounts, inaccuracy of representation and warranties, violation of covenants, cross default and cross acceleration, voluntary and involuntary bankruptcy or insolvency proceedings, inability to pay debts as they become due, material judgments, ERISA events, actual or asserted invalidity of security documents or guarantees and change in control.

On December 12, 2016 the Company gave notice to the holders of the Convertible Notes of its intention to redeem all of the Convertible Notes outstanding on January 12, 2017 (the “Redemption Date”), pursuant to the optional redemption provisions in the Indenture. The redemption price for the Convertible Notes was 100% of the principal amount thereof, plus accrued and unpaid interest, if any, to, but not including, the Redemption Date plus a Make-Whole Premium equal to the present values of the remaining scheduled payments of interest on any Convertible Notes through March 1, 2018 (excluding interest accrued to, but excluding, the Redemption Date). In lieu of receiving the redemption price, holders of the Notes could surrender their Convertible Notes for conversion at any time before January 9, 2017. The conversion rate of the Convertible Notes was 39.0809 shares of the Company’s common stock, for each $1,000 of outstanding principal of the Convertible Notes. As of December 31, 2016 approximately $39.3 million notes were converted resulting in the issuance of 1.5 million shares of the Company’s common stock. As a result of the conversion, the Company incurred a loss on extinguishment of debt of approximately $1.9 million and the carrying value of the Convertible Notes was $42.9 million as of December 31, 2016. In January 2017, the remaining principal was converted to common stock, with the exception of $0.9 million that was redeemed for cash. The Company incurred an additional loss on extinguishment of debt of approximately $1.8 million during the quarter ended March 31, 2017.

The following is a summary of our borrowings as of March 31, 2021 and March 31, 2020, respectively:

	Amounts in millions				Amounts in millions
	September 30, 2017		December 31, 2016		March 31, 2021		March 31, 2020
Debt:
Term loan					$	1,010.0	$	1,184.0
Revolving Credit Facility	$	282.4	$	313.6		—		100.0
Convertible Notes		-		45.7
Mortgages		12.9		12.7
Capital leases		0.3		0.4
Notes						400.0		400.0
Mortgages and other						12.2		12.6
Finance leases						0.2		0.4
Total debt	$	295.6	$	372.4	$	1,422.4	$	1,697.0

The following is a summary of our cash balances and cash flows (in ~~thousands)~~millions) as of and for the year to date periods ended ~~September 30, 2017~~March 31, 2021 and ~~September 30, 2016,~~March 31, 2020, respectively:

September 30, 2017

September 30, 2016

Change

Cash and cash equivalents at the beginning of the year

$
69,118

$
50,320

$
18,798

Cash flows used in operating activities

43,289

46,894

(3,605
)
Cash flows used in investing activities

(17,157
)

(15,684
)

(1,473
)
Cash flows used in financing activities

(49,248
)

(41,943
)

(7,305
)
Effect of exchange rate changes on cash and cash
equivalents

7,149

178

6,971

Cash and cash equivalents at the end of the period

$
53,151

$
39,765

$
13,386

	March 31, 2021			March 31, 2020			Change
Cash and cash equivalents at the beginning of the period	$	254.4		$	167.3		$	87.1
Net cash provided by operating activities		36.2			34.9			1.3
Net cash (used in) provided by investing activities		(9.6	)		48.0			(57.6	)
Net cash (used in) provided by financing activities		(27.1	)		80.1			(107.2	)
Effect of exchange rate changes on cash and cash equivalents		(4.5	)		(3.4	)		(1.1	)
Cash and cash equivalents at the end of the period	$	249.4		$	326.9		$	(77.5	)

Net cash provided ~~from~~by operating activities was approximately ~~$43.3~~$36.2 million for the ~~year~~quarter ended March 31, 2021, an increase of $1.3 million as compared to ~~date period ended September 30, 2017.~~the prior year. This increase in net cash provided was primarily generated by net income of ~~$39.0~~$39.2 million ~~and~~compared to a net loss of $116.6 million during the prior year. The net ~~impact of~~loss in the add-back of certain items including non-cash depreciation, amortization of intangible assets, stock-based compensation, accretion of debt discount, amortization of deferred financing costs, loss on extinguishment of debt, loss on disposal of fixed assets, amortization of inventory fair value adjustment and

~~non-cash loss on foreign currency which~~prior year was ~~approximately $36.2 million. This was partially~~ offset by a ~~net increase in current assets~~$147.5 million non-cash goodwill and ~~liabilities of approximately $31.9 million.~~intangible asset impairment charge.

Net cash used in investing activities for the ~~year to date period~~quarter ended ~~September 30, 2017 increased~~March 31, 2021 decreased approximately ~~$1.5~~$57.6 million compared to the ~~year~~quarter ended March 31, 2020, primarily due to ~~date period ended September 30, 2016. The increase is attributed to higher purchases~~the cross-currency interest rate swap settlement proceeds of ~~manufacturing equipment and plant construction projects at certain facilities. This increase is partially offset by proceeds from~~approximately $56.2 million received during the ~~sale~~first quarter of ~~Changzhou equity and the completion of the working capital adjustment under the Stromag sale and purchase agreement.~~ 2020.

Net cash used in financing activities infor the ~~year to date period~~quarter ended ~~September 30, 2017~~March 31, 2021 as compared to the ~~year to date~~ period ended ~~September 30, 2016 increased~~March 31, 2020 decreased by ~~$7.3 million. This increase relates~~$107.2 million, primarily due to ~~increased net debt payments on~~ the $100.0 million borrowing under the Altra Revolving Credit Facility asreceived during the first quarter of 2020. This decrease was also a result of increased debt paydowns of approximately $14.0 million on our Term Loan Facility compared to the prior year, ~~to date period ended September 30, 2017.~~which was partially offset by a reduction in dividend payments of $7.4 million.

We intend to use our remaining cash and cash equivalents and cash flow from operations to provide for our working capital needs, to ~~fund potential future acquisitions, to~~ service our debt, including principal payments, for capital expenditures, for pension funding, ~~share repurchases~~ and to pay dividends to our stockholders. As of ~~September 30, 2017~~March 31, 2021 we have approximately ~~$49.9~~$141.8 million of cash and cash equivalents held by foreign ~~subsidiaries that are generally subject to U.S. income taxation on repatriation to the U.S.~~subsidiaries. We believe, ~~our future operating~~based on current and projected levels of cash flows ~~will be sufficient~~from operating activities, together with our ability to ~~meet our future operating and investing cash needs. Furthermore,~~borrow under the ~~existing cash balances and the availability of additional borrowings under our 2015~~Altra Revolving Credit Facility, ~~provide additional~~that we have sufficient liquidity to make required payments of interest on our debt, to make amortization payments under the Altra Credit Facilities, to fund our operating needs, to fund working capital and capital expenditure requirements and to comply with the financial ratios in our debt agreements. It is difficult, however, to predict the severity and duration of the economic decline due to the impact of the COVID-19 pandemic and any potential ~~sources of liquidity should they be required.~~resulting impact to our cash flows.

There were no material changes in our contractual obligations during the period ended ~~September 30, 2017.~~March 31, 2021.

We are exposed to various market risk factors such as fluctuating interest rates, changes in foreign currency rates, and changes in commodity prices. During the reporting period, there have been no material changes to the quantitative and qualitative disclosures regarding our market risk set forth in our Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2020.

As of ~~September 30, 2017,~~March 31, 2021, our management, under the supervision and with the participation of our chief executive officer and chief financial officer, carried out an evaluation of the effectiveness of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act. Our disclosure controls and procedures are designed to provide reasonable assurance that information required to be disclosed in the reports ~~filed~~that we file or submit under the Exchange Act, such as this Quarterly Report on Form 10-Q, is (i) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and (ii) accumulated and communicated to our management, including ~~the~~our principal executive officer and principal financial officers, as appropriate, to allow timely decisions regarding required disclosures. Based upon that evaluation, our chief executive officer and chief financial officer have concluded that, as of ~~September 30, 2017,~~March 31, 2021, our disclosure controls and procedures ~~are~~were effective at a reasonable assurance level.

There has been no change in our internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) that occurred during our fiscal quarter ended ~~September 30, 2017,~~March 31, 2021, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

We are, from time to time, party to various legal proceedings arising out of our business. During the reporting period, there have been no material changes to the description of legal proceedings set forth in our Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2020.

The reader should carefully consider the Risk Factors described in our Annual Report on Form 10-K for the year ended December 31, ~~2016~~2020 filed with the Securities and Exchange Commission. Those risk factors described elsewhere in this report on Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, ~~2016~~2020 are not the only ~~ones~~risks we face, but are considered to be the most material. These risk factors could cause our actual results to differ materially from those stated in forward looking statements contained in this Form 10-Q and elsewhere. All risk factors stated in our Annual Report on Form 10-K for the year ended December 31, ~~2016~~2020 are incorporated herein by reference.

During the reporting period there were no material changes to the risk factors previously disclosed in our Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2020.

~~The following table summarizes our share repurchase activity by month for the quarter ended September 30, 2017.~~

~~Disclosure of Activities Under Section 13(r) of the Securities Exchange Act of 1934~~

Under Section 219 of the Iran Threat Reduction and Syria Human Rights Act of 2012, which added Section 13(r) to the Securities Exchange Act of 1934, as amended, we are required to disclose whether Altra or any of its affiliates knowingly engaged in

certain activities, transactions or dealings relating to Iran or certain designated individuals or entities. Disclosure is required even when the activities were conducted outside the United States by non-U.S. entities and even when such activities were conducted in compliance with applicable law. The following information is disclosed pursuant to Section 13(r). None of the following activities involved U.S. affiliates of Altra.None.

During the reporting period, Bibby Transmissions Limited, a subsidiary of Altra organized and existing under the laws of England (“Bibby”), sold couplings to a customer in the United Kingdom, for ultimate re-sale to an Iranian end user for use in a gas treating plant. Gross revenues received by Bibby in connection with this transaction were approximately GBP 12.3 thousand and net profits were approximately GBP 5.9 thousand. Bibby intends to continue pursuing opportunities with this direct customer and end user, to the extent compliant with applicable law.

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Delaware		61-1478870
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

300 Granite Street, Suite 201, Braintree, MA		02184
(Address of principal executive offices)		(Zip Code)

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.001 par value	AIMC	Nasdaq Global Select Market

		Page #
PART I - FINANCIAL INFORMATION
Item 1.	Financial Statements (unaudited)	1
	Condensed Consolidated Balance Sheets	1
	Condensed Consolidated Statement of Operations	2
	Condensed Consolidated Statements of Comprehensive Income	3
	Condensed Consolidated Statements of Cash Flows	4
	Condensed Consolidated Statements of Stockholders’ Equity	5
	Notes to Unaudited Condensed Consolidated Interim Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2221
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	3229
Item 4.	Controls and Procedures	3229

PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	3330
Item 1A.	Risk Factors	3330
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	3330
Item 3.	Defaults Upon Senior Securities	3330
Item 4.	Mine Safety Disclosures	3330
Item 5.	Other Information	3330
Item 6.	Exhibits	3431

SIGNATURES		35







		32

	Gains and Losses on Cash Flow Hedges			Defined Benefit Pension Plans			Cumulative Foreign Currency Translation Adjustment			Total
Accumulated Other Comprehensive Loss by Component, January 1, 2017	$	(646	)	$	(5,668	)	$	(69,772	)	$	(76,086	)
Net current-period Other Comprehensive Income (Loss)		326			(232	)		21,157			21,251
Accumulated Other Comprehensive Loss by Component, September 30, 2017	$	(320	)	$	(5,900	)	$	(48,615	)	$	(54,835	)

	Preliminary Purchase Price Allocation
Total purchase price, excluding acquisition costs of approximately $2.9 million	$	191,852
Cash and cash equivalents		8,758
Trade receivables		24,087
Inventories		22,935
Property, plant and equipment		40,343
Intangible assets		74,795
Prepaid expenses and other current assets		778
Total assets acquired	$	171,696
Accounts payable		(15,370	)
Accrued payroll		(7,171	)
Accrued expenses and other current liabilities		(4,357	)
Income tax payable		(2,525	)
Deferred tax liability		(27,859	)
Other long-term liabilities		(1,255	)
Pension liability		(15,283	)
Total liabilities assumed	$	(73,820	)
Net assets acquired		97,876
Excess purchase price over fair value of net assets acquired	$	93,976

Intangible assets acquired consist of:
Customer relationships	$	56,019
Trade names and trademarks		18,776
Total intangible assets	$	74,795

	Proforma (unaudited)
	Quarter Ended		Year to date Period Ended
	September 30, 2016		September 30, 2016
Total revenues	$	206,424	$	644,361
Net income	$	7,057	$	29,250
Basic earnings per share	$	0.27	$	1.13
Diluted earnings per share	$	0.27	$	1.13

	Couplings, Clutches & Brakes		Electromagnetic Clutches & Brakes		Gearing		Total
Net goodwill balance January 1, 2017	$	104,465	$	37,161	$	47,215	$	188,841
Measurement period adjustment related to acquisition of Stromag, including working capital settlement (See Note 6)	$	738	$	113	$	-	$	851
Impact of changes in foreign currency and other		12,378		623		881		13,882
Net goodwill balance September 30, 2017	$	117,581	$	37,897	$	48,096	$	203,574

	Shares			Weighted-average grant date fair value
Shares unvested January 1, 2017		199,712		$	24.68
Shares granted		150,643			39.43
Shares for which restrictions lapsed		(128,265	)		43.76
Shares unvested September 30, 2017		222,090		$	31.92

	Weighted Average Remaining Contractual Life in Years		Options (In thousands)		Weighted- average grant date fair value		Aggregate Intrinsic Value (In millions)
Outstanding at January 1, 2021				460.7	$	32.48
Granted				124.6		59.40
Outstanding at March 31, 2021		8.6		585.3	$	38.21	$	10.5
Exercisable at March 31, 2021		8.2		172.3	$	31.81	$	4.1
Vested and expected to vest at March 31, 2021		8.8		383.5	$	40.66	$	6.1

	Shares (In thousands)			Weighted- average grant date fair value		Aggregate Intrinsic Value (In millions)
Unvested at January 1, 2021		515.8		$	35.11
Granted		132.1			59.40
Vested		(116.5	)		36.70
Canceled/Forfeited		(5.4	)		32.93
Unvested at March 31, 2021		526.0		$	40.87	$	29.1

	Quarter Ended				Year to Date Period Ended
	September 30, 2017		September 30, 2016		September 30, 2017		September 30, 2016
Couplings, Clutches & Brakes	$	—	$	3,022	$	1,849	$	4,425
Electromagnetic Clutches & Brakes		—		169		—		1,276
Gearing		25		68		809		84
Corporate (1)		24		138		487		806
Total	$	49	$	3,397	$	3,145	$	6,591

	2015 Plan			2017 Plan			Total All Plans
Balance at January 1, 2017	$	1,971		$	—		$	1,971
Restructuring expense incurred		3,145		631				3,776
Cash payments		(4,441	)		(88	)		(4,529	)
Balance at September 30, 2017	$	675		$	543		$	1,218

	Quarters Ended September 30,						Year to Date Period Ended September 30,
	2017			2016			2017			2016
Net Sales:
Couplings, Clutches & Brakes	$	110,109		$	77,446		$	327,310		$	231,225
Electromagnetic Clutches & Brakes		58,304			50,680			187,463			165,083
Gearing		48,368			47,023			144,545			145,038
Inter-segment eliminations		(2,158	)		(2,017	)		(5,903	)		(5,087	)
Net sales	$	214,623		$	173,132		$	653,415		$	536,259
Income from operations:
Segment earnings:
Couplings, Clutches & Brakes	$	12,679		$	6,596		$	33,031		$	20,441
Electromagnetic Clutches & Brakes		6,138			6,589			21,894			20,120
Gearing		5,689			5,650			17,804			17,280
Restructuring		(680	)		(3,397	)		(3,776	)		(6,591	)
Corporate expenses (1)		(2,553	)		(5,069	)		(6,869	)		(9,729	)
Income from operations	$	21,273		$	10,369		$	62,084		$	41,521
Other non-operating (income) expense:
Net interest expense	$	1,811		$	2,815		$	5,547		$	8,615
Other non-operating expense (income), net		696			45			30			(438	)
Loss on extinguishment of convertible debt		—			—			1,797			—
		2,507			2,860			7,374			8,177
Income before income taxes		18,766			7,509			54,710			33,344
Provision for income taxes		5,489			2,196			15,723			9,872
Net income	$	13,277		$	5,313		$	38,987		$	23,472

	March 31, 2021		March 31, 2020
Total assets:
Power Transmission Technologies	$	1,059.9	$	1,047.4
Automation & Specialty		2,966.9		2,928.2
Corporate(2)		140.7		240.6
Total assets	$	4,167.5	$	4,216.2


		September 30,		December, 31
	Balance Sheet Location	2017		2016
Designated as hedging instruments:
Cross currency swap agreements	Other long-term liabilities	$	13,699	$	1,642
Interest rate swap agreement	Other long-term assets		(35)		-
Not designated as hedging instruments:
Cross currency swap agreements	Other long-term liabilities		8,714		889
		$	22,378	$	2,531

	March 31, 2021		December 31, 2020
Cash flow hedge:	Amount of Gain/(Loss) in AOCI
Interest rate swap agreement	$	22.6	$	25.7

		September 30,
	Income Statement Location	2017
Designated as hedging instruments:
Cross currency swap agreements	Other non-operating (income) expense, net	$	11,867
Not designated as hedging instruments:
Cross currency swap agreements	Other non-operating (income) expense, net		7,825
		$	19,692

	Operating Income
	Quarter Ended				Year to Date Period Ended
	September 30, 2017		September 30, 2016		September 30, 2017		September 30, 2016
Couplings, Clutches & Brakes		52%		35%		45%		35%
Electromagnetic Clutches & Brakes		25%		35%		30%		35%
Gearing		23%		30%		25%		30%

	Quarters Ended September 30,						Year to date periods Ended September 30,
	2017			2016			2017			2016
Net Sales:
Couplings, Clutches & Brakes	$	110,109		$	77,446		$	327,310		$	231,225
Electromagnetic Clutches & Brakes		58,304			50,680			187,463			165,083
Gearing		48,368			47,023			144,545			145,038
Intra-segment eliminations		(2,158	)		(2,017	)		(5,903	)		(5,087	)
Net sales	$	214,623		$	173,132		$	653,415		$	536,259
Income from operations:
Segment earnings:
Couplings, Clutches & Brakes	$	12,679		$	6,596		$	33,032		$	20,441
Electromagnetic Clutches & Brakes		6,138			6,589			21,894			20,120
Gearing		5,689			5,650			17,804			17,280
Restructuring		(680	)		(3,397	)		(3,776	)		(6,591	)
Corporate expenses (1)		(2,553	)		(5,069	)		(6,870	)		(9,729	)
Income from operations	$	21,273		$	10,369		$	62,084		$	41,521

Period	Total Number of Shares Purchased		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1)		Approximate Dollar Value of Shares That May Yet be Purchased Under The Plans or Programs
July 1, 2017 to July 31, 2017		—	$	—		—	$	30,000,000
August 1, 2017 to August 30, 2017		—	$	—		—	$	—
September 1, 2017 to September 30, 2017		—	$	—		—	$	—


Exhibit Number		Description

3.1(1)		Certificate of Amendment to the Second Amended and Restated Certificate of Incorporation of Altra industrial Motion Corp., as filed with the ~~Registrant~~Secretary of State of the State of Delaware.

3.2(2)		Second Amended and Restated ~~Bylaws~~Certificate of Incorporation of the Registrant

3.3(3)		Second Amended and Restated Bylaws of the Registrant

31.1*		Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2*		Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1**		Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2**		Certification of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101*		The following materials from the Company’s Quarterly Report on Form 10-Q for the quarter ended ~~September 30, 2017,~~March 31, 2021, formatted in ~~XBRL (Extensible~~iXBRL (Inline Extensible Business Reporting Language): (i) the Unaudited Condensed Consolidated Statement of Operations, (ii) the Unaudited Condensed Consolidated Statement of Comprehensive Income (Loss), (iii) the Unaudited Condensed Consolidated Balance Sheet, (iv) the Unaudited Condensed Consolidated Statement of Cash Flows, (v) the Unaudited Consolidated Statement of Stockholders’ Equity and (vi) Notes to Unaudited Condensed Consolidated Interim Financial Statements.

104		Cover Page Interactive Data File, formatted in iXBRL and contained in Exhibit 101.

			ALTRA INDUSTRIAL MOTION CORP.


~~October 25, 2017~~May 3, 2021	By:		/s/ Carl R. Christenson
	Name:		Carl R. Christenson
	Title		Chairman and Chief Executive Officer
		(Principal Executive Officer)
~~October 25, 2017~~May 3, 2021	By:		/s/ Christian Storch
	Name:		Christian Storch
	Title:		Vice President and Chief Financial Officer
		(Principal Financial Officer)
~~October 25, 2017~~May 3, 2021	By:		/s/ Todd B. Patriacca
	Name:		Todd B. Patriacca
	Title:		Vice President of Finance, Corporate Controller and Treasurer
		(Principal Accounting Officer)

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Emerging growth company