Amended Effective: 01/17/89
Printed: 03/21/89
RESTRICTED-STOCK RETIREMENT PLAN FOR
NON-EMPLOYEE DIRECTORS
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1. PURPOSE OF THE PLAN. The purpose of the Honeywell Restricted-Stock
Retirement Plan for Non-Employee Directors ("Plan") is to grant to non-employee
directors of Honeywell Inc. ("Company") awards ("Awards") of shares of Common
Stock, par value $1.50 per share, of the Company ("Stock") that will be
available without restriction on retirement from the Board and will increase
their proprietary interest in the Company and their identification with the
interests of the Company's stockholders ("Stockholders"). The Plan shall become
effective on the date ("Effective Date") the Plan is approved by the
Stockholders or such later date as may be established by the Board of Directors
of the Company ("Board").
2. GRANT OF AWARDS. Each non-employee director ("Director") of the
Company elected at or after the 1988 Annual Meeting of Stockholders shall be
granted Awards under the Plan as follows:
(a) ANNUAL AWARDS. On the date of each Annual Meeting of
Stockholders ("Annual Meeting"), each person who has served as a Director
since the prior Annual Meeting shall receive an Award of Stock having the
Fair Market Value (as defined in Section 3) equal to one-half the fees
earned by the Director since the date of the prior Annual Meeting.
(b) INITIAL AWARD. Each Director who, at the time of the 1988 Annual
Meeting, has served at least two full years as Director shall receive an
additional initial award of Stock having the Fair Market Value equal to the
number of full years of service as a Director ending with the 1987 Annual
Meeting times the Fair Market Value of the Award that Director receives
under Section 2(a).
3. FAIR MARKET VALUE. For purposes of determining the number of shares of
Stock granted under any Award, the "Fair Market Value" of the Stock shall equal
the average of the reported closing prices for the Stock on the New York Stock
Exchange for the twenty (20) consecutive trading business days immediately
preceding the Annual Meeting; and all fractional shares shall be rounded to the
nearest whole number.
4. ISSUANCE OF STOCK. As promptly as practical following the Annual
Meeting for each Award, the Company shall issue certificates ("Certificates"),
registered in the name of each Director receiving an Award, representing the
number of shares of Stock covered by the Award. The Stock shall have the rights
and be subject to the restrictions and other terms and conditions of the Plan.
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5. RIGHTS. Upon issuance of the Certificates, the Directors in whose
names they are registered shall, subject to the restrictions of the Plan, have
all of the rights of a Stockholder with respect to the Stock, including the
right to vote the Stock and receive cash dividends and other cash distributions
thereon.
6. RESTRICTED PERIOD. The Stock shall be subject to the restrictions of
the Plan for a period ("Restricted Period") running until the Director has
served five years as a Director (including time served prior to issuance of a
Certificate) and until the first to occur of the following events:
(a) the Director retires from the Board in compliance with the
Board's retirement policy as then in effect;
(b) the Director's service on the Board terminates as a result of not
being nominated for reelection by the Board, but not as a result of the
Director's declining to serve again;
(c) the Director's service on the Board terminates because the
Director, although nominated for reelection by the Board, is not reelected
by the Stockholders;
(d) the Director is unable to serve because of disabilities;
(e) the Director dies; or
(f) the occurrence of a Change in Control (as defined below).
For purposes of the Plan, a "Change in Control" of the Company shall
have occurred if:
(i) any "person", as such term is used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act") (other than the Company any trustee or other fiduciary
holding securities under an employee benefit plan of the Company or
any corporation owned, directly or indirectly, by the stockholders of
the Company in substantially the same proportions as their ownership
of stock of the Company), is or becomes the "beneficial owner" (as
defined in Rule 13d-3 under the Exchange Act), directly or indirectly,
of securities of the Company representing 30% or more of the combined
voting power of the Company's then outstanding securities;
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(ii) during any period of two consecutive years (not including
any period prior to the execution of this amendment to the Plan),
individuals who at the beginning of such period constitute the Board
of Directors of the Company (the "Board"), and any new director (other
than a director designated by a person who has entered into an
agreement with the Company to effect a transaction described in clause
(i), (iii) or (iv) of this Section) whose election by the Board or
nomination for election by the Company's stockholders was approved by
a vote of at least two-thirds (2/3) of the directors then still in
office who either were directors at the beginning of the period or
whose election or nomination for election was previously so approved,
cease for any reason to constitute at least a majority thereof;
(iii) the stockholders of the Company approve a merger or
consolidation of the Company with any other corporation, other than
(A) a merger or consolidation which would result in the voting
securities of the Company outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity) more than
50% of the combined voting power of the voting securities of the
Company or such surviving entity outstanding immediately after such
merger or consolidation or (B) a merger or consolidation effected to
implement a recapitalization of the Company (or similar transaction)
in which no "person" (as hereinabove defined) acquires more than 30%
of the combined voting power of the Company's then outstanding
securities; or
(iv) the stockholders of the Company approve a plan of complete
liquidation of the Company or an agreement for the sale or disposition
of the Company of all or substantially all of the Company's assets (or
any transaction having a similar effect).
7. FORFEITURE OF STOCK. If the date ("Termination Date") a Director's
service on the Board terminates is before the end of the Restricted Period, the
Director shall forfeit and return to the Company all Stock awarded to the
Director under the Plan.
8. RECEIPT OF STOCK. If a Director's Termination Date is at or after the
end of the Restricted Period, the Director shall receive, free and clear of the
restrictions of the Plan, all Stock previously awarded under the Plan.
9. RESTRICTIONS. The Stock shall be subject to the following restrictions
during the Restricted Period:
(a) The Stock shall be subject to forfeiture to the Company as
provided in the Plan.
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(b) The Stock may not be sold, assigned, transferred, pledged,
hypothecated or otherwise disposed of; and neither the right to receive
Stock nor any interest under the Plan may be assigned by a Director, and
any attempted assignment shall be void.
(c) The Certificates shall be held by the Company and shall, at the
option of the Company, bear an appropriate restrictive legend and be
subject to appropriate "stop transfer" orders. The Director shall deliver
to the Company a stock power endorsed in blank to the Company.
(d) Any additional Stock or other securities or property (other than
cash) that may be issued with respect to Stock awarded under the Plan as a
result of any stock dividend, stock split, business combination or other
event, shall be subject to the restrictions and other terms and conditions
of the Plan.
(e) A Director shall not be entitled to receive any Stock prior to the
completion of any registration or qualification of the Stock under any
federal or state law or governmental rule or regulation that the Company,
in its sole discretion, determines to be necessary or advisable.
10. WAIVER. In the event a Director's service on the Board terminates,
the Board, in its sole discretion, may waive the forfeiture provisions of
Section 7 as to some or all of the Stock subject to forfeiture thereunder.
11. ADMINISTRATION OF THE PLAN. The Plan shall be administered by a
committee ("Committee") that shall be the Nominating Committee of the Board or
such other committee of Directors as may be designated by the Board. The
Committee shall have full power, discretion and authority to interpret and
administer the Plan, except that the Committee shall have no power to (a)
determine the eligibility for Awards or the number of shares of Stock or timing
or value of Awards to be granted to any Director, or (b) take any action
specifically delegated to the Board under the Plan. The Committee's
interpretations and actions shall, except as otherwise determined by the Board,
be final, conclusive and binding on all persons for all purposes.
12. AMENDMENT OR TERMINATION OF THE PLAN. The Board may, at any time,
amend or terminate the Plan; but no amendment or termination shall, without the
written consent of a Director, reduce the Director's rights under previously
granted Awards. No amendment shall, without approval of the Stockholders,
increase the percentage of fees on which an Annual Award is based in Section
2(a), or modify the requirements of Sections 1 and 2 as to eligibility for
participation in the Plan.
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13. NO RIGHT TO RENOMINATION. Nothing in the Plan or in any Award shall
confer upon any Director the right to be nominated for reelection to the Board.
14. STATEMENT OF ACCOUNT. Each Director shall receive an annual
statement, within thirty days following each Annual Meeting, showing the number
of shares of Stock that have been awarded to the Director under the Plan.