8-KMaterial AgreementsFinancial EventsExhibits & Filings

HONEYWELL INTERNATIONAL INC 8-K Report, Material Agreement (Aug 5, 2016)

Filed August 5, 2016For Securities:HONHONIV

Summary

Honeywell International Inc. (HON) filed an 8-K on August 5, 2016, reporting the entry into a $1.5 billion 364-Day Credit Agreement. This agreement is primarily for general corporate purposes, including funding the acquisition of the Intelligrated business and associated expenses. The credit facility has a maturity date of August 4, 2017, and includes provisions for mandatory reductions upon certain capital markets financing transactions. Key investor-focused aspects include the absence of restrictive financial covenants or dividend restrictions, providing flexibility for Honeywell's operations. However, the agreement does contain standard events of default, such as non-payment, covenant breaches, cross-defaults, and insolvency, which could lead to restrictions on further borrowing or acceleration of repayment. The credit agreement also includes specific triggers related to change of control events.

Key Highlights

  • 1Honeywell entered into a $1.5 billion 364-Day Credit Agreement on August 5, 2016.
  • 2The credit facility is intended for general corporate purposes, including funding the acquisition of the Intelligrated business.
  • 3The agreement has a maturity date of August 4, 2017.
  • 4It includes a mandatory reduction of commitments upon certain capital markets financing transactions.
  • 5The credit agreement does not contain financial covenants or restrict dividend payments.
  • 6Standard events of default are outlined, which could impact borrowing capabilities or require repayment.
  • 7Specific change of control provisions allow lenders to terminate commitments, such as upon a 30% stock acquisition or significant board changes.

Frequently Asked Questions

The primary purpose of the $1.5 billion 364-Day Credit Agreement is for general corporate purposes, including funding the acquisition of the Intelligrated business and related fees and expenses.

The credit agreement has a maturity date of August 4, 2017, meaning all amounts borrowed under it must be repaid by this date, unless terminated earlier according to the agreement's terms.

No, the 364-Day Credit Agreement explicitly states that it does not restrict Honeywell's ability to pay dividends and does not contain financial covenants, offering significant flexibility to the company.

The agreement includes customary events of default such as non-payment of debt, interest, or fees; non-compliance with covenants; cross-default with other debt; bankruptcy; or defaults on certain ERISA obligations. Additionally, lenders can terminate commitments if a person acquires 30% or more of Honeywell's voting stock or if there's a significant change in the board of directors.