Eaton Announces First $1.3 Billion Sustainability-Linked Bond

• Sustainability-linked notes will target Scope 1 and 2 greenhouse gas (GHG) emissions reductions
• The financing marks a new step forward in Eaton’s commitment to science-based targets to mitigate climate change
• Company closes $1.3 billion 2033 sustainability-linked and $700 million 2052 senior notes

Power management company Eaton (NYSE:ETN) today announced it closed an offering of sustainability-linked and senior notes.

Eaton’s sustainability-linked notes offering represents a significant step in aligning the company’s long-term financing structures with its ambitious environmental targets. The sustainability-linked notes interest rate is subject to the achievement of a Sustainability Performance Target (SPT) to achieve at least a 40% reduction in absolute Scope 1 and Scope 2 GHG emissions by year-end 2027, relative to a 2018 baseline.

“Achieving our sustainability goals is as critical to our business as meeting our financial commitments, and this financing aligns both strategies,” said Harold Jones, chief sustainability officer and executive vice president, Eaton Business System, Eaton. “Tackling climate change requires innovative solutions, and this offering will enable us to invest in energy efficiency, renewable energy and other emissions-reduction efforts.”

In 2020, Eaton announced its commitment to science-based targets to mitigate climate change. The targets were approved by the Science Based Target Initiative (SBTi) and include cutting carbon emissions from the company’s operations by 50% and reducing Scope 3 emissions by 15% by year-end 2030, relative to a 2018 baseline. Eaton also established plans to invest $3 billion in research and development for sustainable solutions by 2030. In Eaton’s latest 2021 Sustainability Report, the company announced it was on pace to meet many of these goals.

Eaton published a Sustainability-Linked Bond Framework, and commissioned S&P Global Ratings to issue a Second Party Opinion (SPO) on the Framework’s alignment to the Sustainability-Linked Bond Principles (SLBP).

The sustainability-linked notes due 2033 and senior notes due 2052 were issued by Eaton Corporation and unconditionally guaranteed by Eaton Corporation plc and certain of its subsidiaries.

BofA Securities, Inc., Deutsche Bank Securities Inc., Morgan Stanley & Co. LLC, minority-owned bank Loop Capital Markets LLC, and Wells Fargo Securities, LLC acted as joint book-running managers for the offering and BofA Securities, Inc. also acted as sustainability structuring agent for the offering. In addition to these joint book runners, the transaction included minority and veteran-owned firms Academy Securities, Inc., AmeriVet Securities, Inc., and CastleOak Securities, L.P. as co-managers.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.

Eaton is an intelligent power management company dedicated to improving the quality of life and protecting the environment for people everywhere. We are guided by our commitment to do business right, to operate sustainably and to help our customers manage power ─ today and well into the future. By capitalizing on the global growth trends of electrification and digitalization, we’re accelerating the planet’s transition to renewable energy, helping to solve the world’s most urgent power management challenges, and doing what’s best for our stakeholders and all of society.

Founded in 1911, Eaton has been listed on the NYSE for nearly a century. We reported revenues of $19.6 billion in 2021 and serve customers in more than 170 countries. For more information, visit https://www.eaton.com/us/en-us.html. Follow us on Twitter and LinkedIn.

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which are based on management’s current beliefs and expectations and are subject to substantial risks and uncertainties, both known and unknown, that could cause our future results, performance or achievements to differ significantly from that expressed or implied by such forward-looking statements. Important factors that could cause or contribute to such differences include risks relating to: completion of the offering of senior notes and tender offer for certain outstanding notes; our substantial indebtedness, which may limit our ability to incur additional indebtedness, engage in additional transactions or make new investments, and may result in a further downgrade of our credit ratings; our inability to raise debt or borrow funds in amounts or on terms that are favorable to us; and other factors discussed in our Annual Report on Form 10-K for the year ended December 31, 2021, including the sections thereof captioned “Risk Factors” and “Forward-Looking Statements,” and in our subsequent quarterly reports on Form 10-Q and other filings with the SEC, which are available at www.sec.gov. Forward-looking statements speak only as of the date on which they are made, and we assume no obligation to update or revise any forward-looking statements or other information contained herein, whether as a result of new information, future events or otherwise. You are cautioned not to put undue reliance on these forward-looking statements. No assurance can be given that the transactions described herein will be consummated or as to the ultimate terms of any such transactions.

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