HONEYWELL INC.
                     COMPENSATION PLAN FOR OUTSIDE DIRECTORS


     1. NAME OF PLAN. This plan shall be known as the Honeywell Inc.
Compensation Plan for Outside Directors and is hereinafter referred to as the
"Plan".

     2. PURPOSE OF PLAN. The purpose of the Plan is to enable Honeywell Inc., a
Delaware corporation (the "Company"), to attract and retain persons of
exceptional ability to serve as non-employee directors of the Company
("Directors"). The Plan provides for compensation through the payment of a
Director's Annual Retainer and Meeting Fees in cash, or Common Stock, or for the
deferral of such fees.

     3. ELIGIBLE PARTICIPANTS. Each member of the Board of Directors of the
Company ("Board") from time to time who is not a full-time employee of the
Company or any of its subsidiaries shall be a participant ("Participant") in the
Plan.

     4. EFFECTIVE DATE. The Plan as herein amended shall be effective as of
April 20, 1993.

     5. FEES

           RETAINER. The term "Annual Retainer" shall mean the retainer fee
paid to a Participant for services on the Board for a Director Year.

           MEETING FEES. The term "Meeting Fees" shall mean the fees paid to a
Participant for attending a meeting of the Board or a Committee of the Board.
This term shall include all fees paid to a Participant for extraordinary or
special Board and/or Committee meetings.

           PER DIEM FEES. The Chief Executive Officer, in his or her sole
discretion, may authorize payment of a $1,000 per diem to a Participant who is
asked to work on board issues for a significant part of a day outside of normal
board or committee meetings.

     6. DIRECTORS ELECTIONS. (a) Each Participant shall be given an opportunity
by the Company on an annual basis to elect ("Annual Election") to receive his or
her Annual Retainer and Meeting Fees: (i) in cash, (ii) in shares of Common
Stock, or (iii) in a combination of cash and Common Stock; and in addition a
Participant may elect to defer receipt of the Annual Retainer and Meeting Fees,
which the Participant has the opportunity to earn during the next succeeding
Director Year. The "Director Year" is the fiscal year commencing on the date of
the Company's Annual Meeting of Shareholders and ending on the date immediately
preceding the next Annual Meeting of Shareholders.



           (b) The Annual Election must be in writing and shall be delivered to
the Corporate Secretary of the Company no later than the day preceding the date
of the Annual Meeting of Shareholders. (The Annual Election shall be irrevocable
after the beginning of the Director Year.) The Annual Election shall specify the
applicable percentage of the Annual Retainer and Meeting Fees that such
Participant wishes to receive in cash, or shares of Common Stock, or to defer.

           (c) Any person who becomes a non-employee director following the
Company's Annual Meeting of Shareholders, whether by appointment or election as
a director (or by change in status from a full-time employee), shall receive an
Annual Retainer prorated for the balance of that Director Year.

     7. PAYMENTS

           CASH. If selected, cash payment for the Annual Retainer shall be paid
as soon as practicable after the beginning of a Director Year, and cash payment
for Meeting Fees shall be paid as soon as practicable after a meeting.

           SHARES. (a) If selected, the amount of shares payable in lieu the of
the Annual Retainer shall be determined at the Fair Market Value (as defined in
Section 9 hereunder) on the date of the Company's Annual Meeting of Shareholders
and a certificate shall be delivered to the Participant as soon as practicable
thereafter.

           (b) If selected, payment in shares for Meeting Fees occurring within
a calendar quarter shall be paid as soon as practicable following the end of the
calendar quarter. The number of shares of Common Stock payable  shall equal the
total cash amount in fees for the quarterly period divided by the Fair Market
Value determined as of the last trading day for such quarter.

           DEFERRED FEES. (a) If selected by the Participant, deferred fees
shall be credited to a deferred compensation account for each Participant. The
amount of fees credited to a Participant's account shall equal the deferred cash
amount for the Annual Retainer and/or Meeting Fees. Interest shall be credited
to each account annually, as of December 31, and at the time of distribution of
the entire balance of such an account, on the daily average balance of such
account for such year or portion thereof. For account balances through December
31, 1990, the rate of interest for such year shall be the Company's return on
investment for such year (or, in the case of a deferral made other than as of
December 31, for the prior year), as calculated for management information
purposes pursuant to the Company's applicable policy or practice then in effect.
Commencing January 1, 1991, and, in any event, following retirement from the
Board, the applicable interest rate is to be calculated at the Company's average
five-year borrowing rate.



           (b) A Participant's deferred compensation account shall be paid to
him or her in annual installments over a period of ten years, beginning with an
initial installment to be paid on or about June 1 of the year following his or
her retirement from the Board; provided, however, that the Chief Executive
Officer shall have the discretion to direct the Company to make payments at
different dates (but not before retirement by the Participant), over a longer or
shorter period of time, or in a lump sum, all as the Chairman may direct from
time to time and subject to change from time to time. For this purpose,
retirement is defined as termination from service on the Board due to the first
to occur of the following events: (i) retirement in compliance with the Board's
retirement policy then in effect; (ii) retirement due to not being nominated for
re-election to the Board; (iii) retirement due to not being re-elected by
stockholders; (iv) disability or death; or (v) retirement due to the occurrence
of a Change in Control.

           (c) In the event of a Participant's death, payments shall be made to
the beneficiary designated by the Participant, or in the absence of an executed
beneficiary form, to the person legally entitled thereto, as designated under
his or her will, or to such heirs as determined under the laws of intestacy for
the state of his or her domicile. Deferred amounts shall be nontransferable and
shall not be assignable, alienable, salable or otherwise transferable by the
Participant other than by will or the laws of descent and distribution, or
pursuant to a qualified domestic relations order.

           VOLUNTARY MID-YEAR TERMINATION. In the event a Participant
voluntarily resigns from the Board during a Director Year, the Participant shall
return to the Company a cash payment covering the prorated portion of the Annual
Retainer for the balance of that Director Year. No return of any portion of the
Annual Retainer shall be required in the event a Participant leaves the Board as
the result of retirement, incapacity or death.

     8. SHARE CERTIFICATES, VOTING AND OTHER RIGHTS. The certificates for Common
Stock issued under Section 7 may be registered in the name of the Participant,
or in the name of the Participant and one other individual as joint tenants, and
shall be held by such Participant. All Common Stock that shall be issued
hereunder shall be fully paid and non-assessable. The Company shall pay all
original issue taxes with respect to the issue of shares and all other fees and
expenses necessarily incurred by Company in connection therewith.

     9. FAIR MARKET VALUE. "Fair Market Value" means, as of any valuation date,
the median of the high and low trading price of Honeywell Inc. Common Stock, par
value $1.50 per share, as quoted in the New York Stock Exchange Composite
Transactions, on such date as reported in the Wall Street Journal (or, if there
is no reported sale on such date, on the last preceding date on which any
reported sale occurred).



     10. FRACTIONS OF SHARES. The Company shall not issue fractions of shares.
Whenever under the terms of the Plan, a fractional share would otherwise be
required to be issued, the Participant shall be paid in cash for such fractional
share; or for Participants electing to receive Meeting Fees in stock, the unpaid
amount shall be added to the fees for the next quarterly period.

     11. GENERAL RESTRICTIONS. The issuance of Common Stock or the delivery of
certificates for such shares to Participants under the Plan shall be subject to
the requirement that, if at any time the General Counsel or Corporate Secretary
of the Company shall reasonably determine, in his or her discretion, that the
listing, registration or qualification of such Common Stock upon any securities
exchange or under any state or federal law, or the consent or approval of any
governmental body, is necessary or desirable as a condition of, or in connection
with, the issuance or payment or delivery shall not take place unless such
listing, registration, qualification, consent or approval shall have been
effected or obtained free of any conditions not reasonably acceptable to the
General Counsel or Corporate Secretary.

     12. SHARES AVAILABLE. Shares of Common Stock issuable under the Plan shall
be taken from authorized but unissued or treasury shares of the Company, as
shall from time to time be necessary for issuance pursuant to the Plan.

     13. CHANGE IN CAPITAL STRUCTURE. In the event of any change in the Common
Stock by reason of any stock dividend, split, combination of shares, exchange of
shares, warrants or rights offering to purchase Common Stock at a price below
its fair market value, reclassification, recapitalization, merger, consolidation
or other change in capitalization, appropriate adjustment shall be made by the
Company in the number and kind of shares subject to the Plan and any other
relevant provisions of the Plan, whose determination shall be binding and
conclusive on all persons.

     14. INCOME TAX PROVISIONS. No income will be recognized by a Participant at
the time of the deferral of Annual Retainer and/or Meeting Fees. Upon payment to
a Participant with respect to amounts previously deferred, the Participant will
recognize ordinary income in an amount equal to the sum of the cash received
from a Participant's deferred compensation account.

     15. ADMINISTRATION. The Plan shall be administered by the Chief Executive
Officer, who shall have full authority to construe and interpret the Plan, to
establish, amend and rescind rules and regulations relating to the Plan, and to
take all such actions and make all such determinations in connection with the
Plan as he or she may deem necessary or desirable. The Chief Executive Officer
may from time to time make such amendments to the Plan as he or she may deem
proper, necessary, and in the best interests of the Company.



     16. RIGHTS OF DIRECTORS. Nothing in the plan shall confer upon any
Participant any right to serve on the Board for any period of time or to
continue his or her current or any other rate of compensation.

     17. GOVERNING LAW. The Plan and all actions taken thereunder shall be
governed by and construed in accordance with the laws of the State of Minnesota.