Honeywell International Inc. entered into a 364-Day Credit Agreement with the banks, financial institutions and other institutional lenders party thereto, Citibank, N.A. (“Citibank”), as administrative agent, and JPMorgan Chase Bank, N.A., as syndication agent.

The 364-Day Credit Agreement provides for revolving credit commitments in an aggregate principal amount of $1.5 billion and is maintained for general corporate purposes. Amounts borrowed under the 364-Day Credit Agreement are required to be repaid no later than April 9, 2021, unless the 364-Day Credit Agreement is terminated earlier pursuant to its terms or the advances are converted to a term loan that would be required to be repaid on April 9, 2022.

The 364-Day Credit Agreement does not restrict Honeywell’s ability to pay dividends, nor does it contain financial covenants. The failure of Honeywell to comply with customary conditions or the occurrence of customary events of default contained in the 364-Day Credit Agreement would prevent any further borrowings and would generally require the repayment of any outstanding borrowings under the 364-Day Credit Agreement.

Such events of default include, among other things, (a) non-payment of 364-Day Credit Agreement debt, interest or fees; (b) non-compliance with the terms of the 364-Day Credit Agreement covenants; (c) cross-default with other material debt in certain circumstances; (d) bankruptcy or insolvency; and (e) defaults on certain obligations under the Employee Retirement Income Security Act, of 1974. Additionally, each of the lenders has the right to terminate its commitment to lend additional funds under the 364-Day Credit Agreement if any person or group acquires beneficial ownership of 30 percent or more of Honeywell’s voting stock, or, during any twelve-month period, individuals who were directors of Honeywell at the beginning of the period cease to constitute a majority of the board of directors, except to the extent individuals who at the beginning of such twelve-month period were replaced by individuals (x) whose election or nomination to the board of directors was approved by a majority of remaining members of the board of directors at the time of such election or nomination, or (y) who were nominated by a majority of the remaining members of the board of directors at the time of such election or nomination and subsequently elected as directors by shareowners of Honeywell.

At Honeywell’s option, advances under the 364-Day Credit Agreement would be (1) a “Base Rate Advance” denominated in U.S. Dollars and would bear interest at the Base Rate (as defined below) plus the Applicable Margin (as described below), or (2) an “Eurocurrency Rate Advance” denominated in U.S. Dollars or in Euros and would bear interest at the Eurocurrency Rate (defined as reserve-adjusted LIBOR, subject to a floor of zero), plus the Applicable Margin.

The Base Rate is the highest of (a) the rate of interest announced publicly by Citibank in New York, New York, from time to time, as Citibank’s base rate, (b) 0.5% above the federal funds rate (subject to a floor of zero), and (c) LIBOR for a one-month period (subject to a floor of zero) plus 1.00%. The Applicable Margin for Eurocurrency Rate Advances is based upon a grid determined by reference to Honeywell’s non-credit enhanced long-term senior unsecured debt rating (the “Public Debt Rating”), in an amount equal to 0.750% per annum if Honeywell’s Public Debt Rating is at a level of at least A+ by Standard & Poor’s, a Standard & Poor’s Financial Services LLC business (“Standard & Poor’s”), or A1 by Moody’s Investors Service, Inc. (“Moody’s”) (“Level 1”), with (i) a step-up to 0.875% per annum if Honeywell’s Public Debt Rating level is lower than Level 1 but at least A by Standard & Poor’s or A2 by Moody’s (“Level 2”), and (ii) a further step-up to 1.000% per annum if Honeywell’s Public Debt Rating level falls below Level 2.
The Applicable Margin for Base Rate Advances is 0.000%.

Honeywell has agreed to pay a commitment fee on the aggregate amount of each lender’s unused commitment for the 364-Day Credit Agreement, based upon a grid determined by reference to Honeywell’s Public Debt Rating, in an amount equal to 0.030% per annum if Honeywell’s Public Debt Rating is at a level of at least A+ by Standard & Poor’s, or A1 by Moody’s (“Fee Level 1”), with a step-up to 0.040% per annum if Honeywell’s Public Debt Rating level is lower than Fee Level 1 but at least A by Standard & Poor’s or A2 by Moody’s (“Fee Level 2”), and a further step-up to 0.060% per annum if Honeywell’s Public Debt Rating level falls below Fee Level 2. The 364-Day Credit Agreement is not subject to termination based upon a decrease in Honeywell’s debt ratings or as a result of a Material Adverse Change (as defined in the 364-Day Credit Agreement).