[8-K] Honeywell International, Inc. Reports Material Event

Rhea-AI Filing Summary

Honeywell (HON) has signed an agreement to terminate its 2018 Indemnification and Reimbursement Agreement with Resideo. In exchange for cancelling all future variable payments (capped at $140 M per year through 2043), Resideo Intermediate Holding (RIH) will make a one-time cash payment of $1.59 B to Honeywell at closing, expected no later than 29 Aug 2025 (extension to 30 Oct 2025 at Honeywell’s option). A scheduled $35 M quarterly payment was already received on 29 Jul 2025.

From signing to closing, scheduled indemnity payments are suspended and, if closing occurs, permanently forgiven. If the deal fails to close and Honeywell terminates after 29 Aug 2025 (or Resideo after 30 Oct 2025), Resideo must pay a $100 M liquidated-damage fee and the original indemnity agreement remains in force with accrued interest (5% p.a.). Resideo and RIH represent that committed financing, plus cash on hand, will cover the payment; their obligations are not conditioned on funding.

Separately, Honeywell’s Board amended and restated the company By-laws on 25 Jul 2025, adding Article V, Section 17 to designate a Senior Management Official for U.S. National Industrial Security Program compliance.

Positive

• $1.59 B lump-sum payment provides immediate cash inflow and removes multiyear collection uncertainty.
• $100 M break-fee protects Honeywell if the transaction does not close.
• Suspension and potential forgiveness of interim payments reduces administrative burden and litigation risk.

Negative

• Transaction has not yet closed; failure would reinstate the original agreement with accrued interest.
• Honeywell forfeits potential upside if future reimbursements would have exceeded $1.59 B (undetermined at this stage).

Insights

Financial Analyst

TL;DR: $1.59 B cash accelerates uncertain future indemnity receipts; modest execution risk until closing.

The deal converts a capped, multi-decade stream of environmental indemnity reimbursements into immediate liquidity, improving Honeywell’s near-term cash position and reducing counter-party exposure to Resideo. At a 5% discount rate, a $140 M annual cap through 2043 has an NPV similar to the agreed lump sum, suggesting fair value while eliminating administrative costs and variability. The $100 M break-fee and committed financing lower default risk, though the transaction remains subject to closing conditions by 29 Aug 2025 (extendable to 30 Oct 2025). Net effect is modestly positive for leverage metrics and capital allocation flexibility.

Corporate Governance Specialist

TL;DR: Terminates complex legacy agreement; new by-law clause adds security oversight.

Eliminating the indemnity contract simplifies Honeywell’s contingent asset reporting and removes prolonged governance monitoring of Resideo’s environmental liabilities. The amendment to the By-laws formalises senior-level accountability for classified-information compliance, aligning with federal security requirements. No adverse governance implications identified; the clear break-fee structure protects shareholders if financing fails.

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

Form 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

DATE OF REPORT – July 25, 2025

(Date of earliest event reported)

HONEYWELL INTERNATIONAL INC.

(Exact name of Registrant as specified in its Charter)

 

Delaware			1-8974			22-2640650
(State or other jurisdiction of incorporation)			(Commission File Number)			(I.R.S. Employer Identification Number)

855 S. MINT STREET, CHARLOTTE, NC..................................................28202

......(Address of principal executive offices).................................................(Zip Code)

 Registrant’s telephone number, including area code: (704) 627-6200

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: 

☐			Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐			Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐			Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐			Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, par value $1 per share

HON

The Nasdaq Stock Market LLC

3.500% Senior Notes due 2027

HON 27

The Nasdaq Stock Market LLC

2.250% Senior Notes due 2028

HON 28A

The Nasdaq Stock Market LLC

3.375% Senior Notes due 2030

HON 30

The Nasdaq Stock Market LLC

0.750% Senior Notes due 2032

HON 32

The Nasdaq Stock Market LLC

3.750% Senior Notes due 2032

HON 32A

The Nasdaq Stock Market LLC

4.125% Senior Notes due 2034

HON 34

The Nasdaq Stock Market LLC

3.750% Senior Notes due 2036

HON 36

The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging Growth Company ☐

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. ☐ 

Item 1.02    Termination of a Material Definitive Agreement

As previously disclosed, on October 14, 2018, in connection with the complete legal and structural separation (the “Spin-Off”) of Resideo Technologies, Inc. (“Resideo”) from Honeywell International Inc. (the “Company”), the Company entered into certain agreements with Resideo, including an Indemnification and Reimbursement Agreement, dated October 14, 2018, between New HAPI Inc. (as subsequently assigned to Resideo Intermediate Holding Inc. (“RIH”)) and the Company (the “Indemnification and Reimbursement Agreement”), to which relevant Resideo subsidiaries have become parties.

Pursuant to the Indemnification and Reimbursement Agreement, RIH has an obligation to make cash payments to the Company in amounts equal to 90% of payments, which include amounts billed (“payments”), with respect to certain environmental claims, remediation and, to the extent arising after the Spin-Off, hazardous exposure or toxic tort claims, in each case, including consequential damages (the “liabilities”) in respect of specified properties contaminated through historical business operations, including the legal and other costs of defending and resolving such liabilities, less 90% of the Company’s net insurance receipts relating to such liabilities, and less 90% of the net proceeds received by the Company in connection with (i) affirmative claims relating to such liabilities, (ii) contributions by other parties relating to such liabilities and (iii) certain property sales (the “recoveries”). The amount payable by RIH in respect of such liabilities arising in any given year is subject to a cap of $140 million (exclusive of any late payment fees up to 5% per annum). The Indemnification and Reimbursement Agreement was intended to remain in effect until the earlier of: (1) December 31, 2043; or (2) December 31 of the third consecutive year during which the annual indemnification obligation (including in respect of deferred payment amounts) has been less than $25 million.

On July 30, 2025, the Company, Resideo, RIH and certain guarantor parties thereto entered into a termination agreement (the “Agreement”) for the accelerated monetization of the Indemnification and Reimbursement Agreement. The closing of the transactions contemplated by the Agreement is expected to occur effective no later than August 29, 2025 (the “Closing”), which date may be extended by Honeywell to October 30, 2025, if the termination has not occurred and the Agreement has not otherwise been terminated by August 29, 2025.

Under the Agreement, at the Closing, RIH has agreed to pay the Company a one-time cash payment of $1.59 billion (the “Payment”), in lieu of all future payments to which the Company is entitled pursuant to the Indemnification and Reimbursement Agreement. Additionally, on July 29, 2025, Resideo paid the Quarterly Payment of $35,000,000 to be paid pursuant to Section 2.3(c) of the Indemnification and Reimbursement Agreement in connection with the Fiscal Quarter ending September 30, 2025.

From signing until Closing (or termination of the Agreement), any amounts that would otherwise be due under the Indemnification and Reimbursement Agreement are suspended and tolled, and if the Closing occurs, these tolled amounts are not payable. However, if the Agreement is terminated, any such tolled amounts become due with 5% interest per annum.

Under the Agreement, Resideo and RIH represent and warrant that they have received financing commitments to secure financing sufficient, together with available cash on hand, to fund the Payment and that no material defaults exist under such financing arrangements. The obligations of Resideo and RIH under the Agreement are not conditioned on such financing being obtained. If the Closing does not occur by August 29, 2025 and the Agreement is terminated by Honeywell thereafter, or if the Closing does not occur by October 30, 2025 and the Agreement is terminated by Resideo thereafter, in each case when the financing to be received by Resideo has not yet been received, Resideo is required to pay the Company a fee of $100 million as liquidated damages and the Indemnification and Reimbursement Agreement and all guarantees entered into pursuant to the terms thereof will remain in effect.

The foregoing description of the Indemnification and Reimbursement Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Indemnification and Reimbursement Agreement, which was filed as an exhibit to the Company’s Current Report on Form 8-K filed on October 15, 2018, which is incorporated by reference herein.

Item 5.03    Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year

On July 25, 2025, the Board of Directors (the “Board”) of the Company amended and restated the By-laws of the Company (as amended and restated, the “By-laws”), effective as of such date, to include a new Section 17 in Article V related to the designation of a Senior Management Official for purposes of the United States National Industrial Security Program Operating Manual.

The foregoing summary is qualified in its entirety by reference to the text of the By-laws of the Company, filed herewith as Exhibit 3(i) and incorporated herein by reference.

Item 9.01    Financial Statements and Exhibits

(d) Exhibits

The following exhibits are filed as part of this report:

Exhibit #						Description
3(i)						Amended and Restated By-laws of Honeywell International Inc., dated July 25, 2025.
104						Cover Page Interactive Data File (the cover page XBRL tags are embedded within the Inline XBRL document)

SIGNATURE

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

 

Date:

July 30, 2025

HONEYWELL INTERNATIONAL INC.

By: /s/ Su Ping Lu

Su Ping Lu

Senior Vice President, General Counsel and Corporate Secretary

FAQ

What is Honeywell (HON) receiving under the termination agreement?

At closing, Honeywell will receive a $1.59 B cash payment from Resideo Intermediate Holding.

When is the termination of the Resideo indemnity agreement expected to close?

Closing is expected by 29 Aug 2025, extendable by Honeywell to 30 Oct 2025.

What happens if the deal between Honeywell and Resideo fails to close?

Resideo must pay $100 M in liquidated damages and the 2018 Indemnification and Reimbursement Agreement remains in effect with 5% interest on deferred amounts.

Did Honeywell already receive any payments related to the indemnity agreement in 2025?

Yes, Resideo paid the scheduled $35 M quarterly installment on 29 Jul 2025.

Why did Honeywell amend its By-laws on 25 Jul 2025?

The Board added a section designating a Senior Management Official to comply with the U.S. National Industrial Security Program Operating Manual.