Annual operating expenses of trust

[TABLE OF CONTENTS](#i72efc1fa764e42bfa26060268f6277f4_7)HONEYWELL INTERNATIONAL INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Unaudited)(Dollars in tables in millions, except per share amounts)The Company and the Trust are discussing a potential settlement of Honeywell’s remaining obligations to the Trust. The potential settlement contemplates, among other things, a lump sum cash payment to the Trust in return for elimination of and Honeywell’s full release from any future obligations to fund (i) claims against the Trust, which comprise Honeywell's NARCO asbestos-related liability, and (ii) the Trust’s annual operating expenses. Material terms and conditions of the potential settlement remain unresolved, and no assurance can be given that a settlement will be reached. Any such settlement would be contingent on (i) approval of the Bankruptcy Court, and (ii) a final Bankruptcy Court order that (A) the Channeling Injunction will remain in effect, and (B) Honeywell shall be released from any and all liabilities for any current or future claims based on exposure to NARCO asbestos-containing products without regard to ongoing solvency of the Trust. In the event a final settlement approved by the Bankruptcy Court is reached, the Company would remove the NARCO asbestos-related liability from the Company’s consolidated balance sheet. In the event a final settlement is not reached, the Company will continue to preserve all its available rights. The Company anticipates the amount of the potential lump-sum payment would exceed the currently reserved NARCO asbestos-related liability. Based on available information to date, the Company does not expect the impact of any settlement would be material with respect to the Company’s consolidated financial position.Due to the bankruptcy filing in 2002, claimants were not permitted to file additional claims until the Trust became operative in 2014. As a consequence, there was a large backlog of claims filed with the Trust upon it becoming operative in 2014 through December 31, 2017, the date by which these claims had to be filed or else be barred by the expiration of the statute of limitations. Therefore, the claims filing rate did not start to normalize until 2018 and thereafter. As a result, between 2002 and 2018, the Company lacked a history of sufficiently reliable claims data to derive a reasonable estimate of its NARCO asbestos-related liability, and the Company continued to update its original estimate, as appropriate, using all available information. Beginning in 2020, with three years of sufficiently reliable claims data, the Company updated its estimate of the NARCO asbestos-related liability. The estimate for the resolution of asserted Annual Contribution Claims and Pre-Established Unliquidated Claims uses average payment values for the relevant historical period. The estimate for unasserted claims is based on historic and anticipated claims filing experience and payment rates, disease classifications and type of claim, and average payment values by the Trust for the relevant historical period. The Company utilizes an asbestos liability valuation specialist to support the preparation of the NARCO asbestos-related liability estimates during the fourth quarter each year. The Company's estimates, which involve significant management judgment, and consider multiple scenarios, include all years of epidemiological disease projection through 2059.The NARCO asbestos-related liability reflects an estimate for the resolution of Annual Contribution Claims and Pre-Established Unliquidated Claims filed with the Trust, as well as for unasserted Annual Contribution Claims and Pre-Established Unliquidated Claims. The NARCO asbestos-related liability excludes the annual operating expenses of the Trust which are expensed as they are incurred (approximately $21 million in 2021). The Company's NARCO-related insurance receivable reflects coverage which reimburses Honeywell for portions of NARCO-related claims and defense costs. This coverage is provided by a large number of insurance policies written by dozens of insurance companies in both the domestic insurance market and the London excess market. Honeywell's NARCO-related insurance receivable is an estimate of the probable amount of insurance that is recoverable for asbestos claims. The Company's judgments related to the Company's insurance carriers and insurance coverages are reasonable and consistent with Honeywell's historical dealings and Honeywell's knowledge of any pertinent solvency issues surrounding insurers.Bendix Products – Bendix manufactured automotive brake linings that contained chrysotile asbestos in an encapsulated form. Claimants consist largely of individuals who allege exposure to asbestos from brakes from either performing or being in the vicinity of individuals who performed brake replacements. The following tables present information regarding Bendix-related asbestos claims activity: 

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|  | Nine Months EndedSeptember 30, |  | Years EndedDecember 31, |
| Claims Activity | 2022 |  | 2021 | 2020 |
| Claims unresolved at the beginning of period |  | 6,401  |  |  |  | 6,242  |  |  | 6,480  |  |
| Claims filed |  | 1,486  |  |  |  | 2,611  |  |  | 2,233  |  |
| Claims resolved |  | (2,154) |  |  |  | (2,452) |  |  | (2,471) |  |
| Claims unresolved at the end of period |  | 5,733  |  |  |  | 6,401  |  |  | 6,242  |  |



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|  | September 30, |  | December 31, |
| Disease Distribution of Unresolved Claims | 2022 |  | 2021 | 2020 |
| Mesothelioma and other cancer claims |  | 3,395  |  |  |  | 3,760  |  |  | 3,422  |  |
| Nonmalignant claims |  | 2,338  |  |  |  | 2,641  |  |  | 2,820  |  |
| Total claims |  | 5,733  |  |  |  | 6,401  |  |  | 6,242  |  |

25 Honeywell International Inc. 
