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Insurance Recoveries for Asbestos Related Liabilities
Bendix NARCO Total Bendix NARCO Total Bendix NARCO Total
2013 2012 2011
Year Ended December 31, Year Ended December 31, Year Ended December 31,
Beginning of year. . . . . . . . . . . . . . . . $138 $569 $707 $162 $618 $ 780 $157 $ 718 $ 875
Probable insurance recoveries
related to estimated liability . . . . 27 — 27 28 — 28 29 — 29
Insurance receipts for asbestos
related liabilities . . . . . . . . . . . . . . . (24) (34) (58) (60) (62) (122) (34) (100) (134)
Insurance receivables settlements
and write offs . . . . . . . . . . . . . . . . . — (6) (6) 8 13 21 10 — 10
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . — 2 2 — — — — — —
End of year . . . . . . . . . . . . . . . . . . . . . $141 $531 $672 $138 $569 $ 707 $162 $ 618 $ 780
NARCO and Bendix asbestos related balances are included in the following balance sheet
accounts:
2013 2012
December 31,
Other current assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 77 $ 44
Insurance recoveries for asbestos related liabilities. . . . . . . . . . . . . . . . . . . . . . 595 663
$ 672 $ 707
Accrued liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 461 $ 480
Asbestos related liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,150 1,292
$1,611 $1,772
NARCO Products—On January 4, 2002, NARCO filed a petition for reorganization under Chapter
11 of the U.S. Bankruptcy Code. In connection with the filing of NARCO’s petition in 2002, the U.S.
Bankruptcy Court for the Western District of Pennsylvania (“the Bankruptcy Court”) issued an injunction
staying the prosecution of NARCO-related asbestos claims against the Company, which stayed in
place throughout NARCO’s Chapter 11 case. In November 2007, the Bankruptcy Court confirmed
NARCO’s Third Amended Plan of Reorganization (NARCO Plan of Reorganization) and it became fully
effective on April 30, 2013.
In connection with implementation of the NARCO Plan of Reorganization, a federally authorized
524(g) trust (“NARCO Trust”) was established for the evaluation and resolution of all existing and
future NARCO asbestos claims. Both Honeywell and NARCO are protected by a permanent
channeling injunction barring all present and future individual actions in state or federal courts and
requiring all asbestos related claims based on exposure to NARCO products to be made against the
NARCO Trust. The NARCO Trust will review submitted claims and determine award amounts in
accordance with established Trust Distribution Procedures approved by the Bankruptcy Court which
set forth all criteria claimants must meet to qualify for compensation including, among other things,
exposure and medical criteria that determine the award amount. In addition, Honeywell will continue to
provide input to the detailed controls design of the NARCO Trust, and has on-going audit rights to
review and monitor claims processor’s adherence to the established requirements of the Trust
Distribution Procedures and as a means of detecting and deterring irregularities in claims.
In connection with NARCO’s bankruptcy filing, Honeywell agreed to certain obligations which were
triggered upon the effective date of the NARCO Plan of Reorganization. As agreed, during the second
quarter of 2013, we provided NARCO with $17 million in financing and simultaneously forgave such
indebtedness. We also paid $40 million to NARCO’s former parent company and $16 million to certain
101
HONEYWELL INTERNATIONAL INC.
NOTES TO FINANCIAL STATEMENTS—(Continued)
(Dollars in millions, except per share amounts)