5-Year
Credit Agreement
On April 26, 2019, Honeywell entered into an Amended and Restated Five Year Credit Agreement (the
5-Year
Credit Agreement
) with the banks, financial institutions, and other institutional lenders party thereto, Citibank, as administrative agent, Citibank Europe PLC, UK Branch, as swing line agent, JPMorgan Chase Bank, N.A., as syndication
agent, Bank of America, N.A., Barclays Bank PLC, Deutsche Bank Securities Inc., Goldman Sachs Bank USA, Morgan Stanley MUFG Loan Partners, LLC, and Wells Fargo Bank, National Association, as documentation agents, and Citibank and JPMorgan Chase
Bank, N.A., as joint lead arrangers and
co-bookrunners.
The
5-Year
Credit
Agreement provides for revolving credit commitments in an aggregate principal amount of $4.0 billion and is maintained for general corporate purposes. Commitments under the
5-Year
Credit Agreement can be
increased pursuant to the terms of the
5-Year
Credit Agreement to an aggregate amount not to exceed $4.5 billion. The
5-Year
Credit Agreement amends and restates
the previously reported $4.0 billion amended and restated five year credit agreement dated as of April 27, 2018 (the
Prior Agreement
). No borrowings were outstanding at any time under the Prior Agreement. The
5-Year
Credit Agreement includes a sublimit for the potential issuance of multi-currency letters of credit and a sublimit for swing line advances, in each case in amounts equivalent to the commitments of the
revolving credit lenders thereunder.
The
5-Year
Credit Agreement has substantially the same material terms and
conditions as the Prior Agreement with an extension of maturity. Any amounts borrowed under the
5-Year
Credit Agreement are required to be repaid no later than April 26, 2024, unless such date is extended
pursuant to the terms of the
5-Year
Credit Agreement.
The
5-Year
Credit
Agreement does not restrict Honeywells 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
5-Year
Credit Agreement would prevent any further borrowings and would generally require the repayment of any outstanding borrowings under the
5-Year
Credit Agreement. Such
events of default include, among other things,
(a) non-payment
of the
5-Year
Credit Agreement debt, interest or fees;
(b) non-compliance
with the terms of the
5-Year
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 or issue
additional letters of credit under the
5-Year
Credit Agreement if any person or group acquires beneficial ownership of 30 percent or more of Honeywells voting stock, or, during any
12-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 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 Honeywells option, revolving credit borrowings under the
5-Year
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,
Euros, Pounds Sterling or Japanese Yen and would bear interest at the Eurocurrency Rate (defined as reserve-adjusted LIBOR), 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 Citibanks 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 Advances is based on Honeywells credit default swap
mid-rate
spread subject to a floor and a cap based on Honeywells Public Debt Rating.
The Applicable Margin for Base Rate Advances is 100 basis points lower than the Applicable Margin for Eurocurrency Rate Advances, subject to a floor of 0.00%.