Honeywell 2008 Annual Report Download - page 107

HONEYWELL INTERNATIONAL INC.
NOTES TO FINANCIAL STATEMENTS—(Continued)
(Dollars in millions, except per share amounts)
default contained in the credit agreement would prevent any further borrowings and would generally require the
repayment of any outstanding borrowings under the credit agreement. Such events of default include: (a) non-
payment of credit agreement debt, interest or fees; (b) non-compliance with the terms of the credit agreement
covenants; (c) cross-default to other debt in certain circumstances; (d) bankruptcy; and (e) defaults upon
obligations under Employee Retirement Income Security Act. Additionally, each of the banks has the right to
terminate its commitment to lend additional funds or issue letters of credit under the agreement if any person or
group acquires beneficial ownership of 30 percent or more of our 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 (the Board).
Loans under the $2.8 billion credit facility are required to be repaid no later than May 14, 2012. We have
agreed to pay a facility fee of 0.05 percent per annum on the aggregate commitment.
Interest on borrowings under the $2.8 billion credit facility would be determined, at Honeywell's option, by (a)
an auction bidding procedure; (b) the highest of the floating base rate publicly announced by Citibank, N.A., 0.5
percent above the average CD rate, or 0.5 percent above the Federal funds rate; or (c) the Eurocurrency rate
plus 0.15 percent (applicable margin).
The facility fee, the applicable margin over the Eurocurrency rate and the letter of credit issuance fee, are
subject to change, based upon a grid determined by our long term debt ratings. The credit agreement is not
subject to termination based upon a decrease in our debt ratings or a material adverse change.
In February 2008, the Company issued $600 million of 4.25% Senior Notes due 2013 and $900 million
5.30% Senior Notes due 2018 (collectively, the "Senior Notes"). The Senior Notes are senior unsecured and
unsubordinated obligations of Honeywell and rank equally with all of Honeywell's existing and future senior
unsecured debt and senior to all Honeywell's subordinated debt. The offering resulted in gross proceeds of $1.5
billion, offset by $13 million in discount and issuance costs.
In the first quarter of 2008, the Company repaid $200 million of its 6.2% Notes, primarily through issuance of
commercial paper. In the second quarter of 2008, the Company repaid $200 million of its 71/2% Notes, primarily
from the issuance of commercial paper.
Note 15—Lease Commitments
Future minimum lease payments under operating leases having initial or remaining noncancellable lease
terms in excess of one year are as follows:
At December 31,
2008
2009 $ 323
2010 243
2011 184
2012 127
2013 101
Thereafter 314
$ 1,292
We have entered into agreements to lease land, equipment and buildings. Principally all our operating leases
have initial terms of up to 25 years, and some contain renewal options subject to customary conditions. At any
time during the terms of some of our leases, we may at our option purchase the leased assets for amounts that
approximate fair value. We do not expect that any of our commitments under the lease agreements will have a
material adverse effect on our consolidated results of operations, financial position or liquidity.
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