Exhibit 10.6

SUPPLEMENTAL NON-QUALIFIED SAVINGS PLAN FOR HIGHLY COMPENSATED

EMPLOYEES OF HONEYWELL INTERNATIONAL INC. AND ITS SUBSIDIARIES

(amended and restated effective January 1, 2006,

with amendments effective January 1, 2005)

History.

Effective January 1, 2006, the Supplemental Non-Qualified Savings Plan For
Highly Compensated Employees Of Honeywell International Inc. And Its
Subsidiaries (Career Band 5 and Below) (the “Supplemental Savings Plan”) was
merged with and into the Supplemental Non-Qualified Savings Plan for Highly
Compensated Employees of Honeywell International Inc. and its Subsidiaries
(Career Band 6 and above) (the “Executive Supplemental Savings Plan”), and the
resulting plan shall be known as the Supplemental Non-Qualified Savings Plan for
Highly Compensated Employees of Honeywell International Inc. and its
Subsidiaries (the “Plan”).

Effective January 1, 2005, the terms of the Supplemental Savings Plan, the
Executive Supplemental Savings Plan and the Plan are intended to comply with the
requirements of Section 409A of the Internal Revenue Code of 1986, as amended,
and any corresponding rules and regulations promulgated under that Section. As
such, Honeywell International Inc. (the “Corporation”) reserves the right to
take any action it deems necessary or desirable to comply with Section 409A.

1.

Eligibility

(a) For plan years beginning on or after January 1, 2006, the following
employees of the Corporation and its participating affiliates are eligible to
participate in the Plan as of the first paydate of the plan year:

 

(1)

any employee who is in Career Band 6 or above,

 

(2)

any employee (A) who is in Career Band 5 at any time during the designated
election period for the applicable plan year (the “Open Enrollment Period”), and
(B) whose Base Annual Salary (as defined in Section 3 below) that is paid and
posted to the Plan’s electronic recordkeeping system as of the last paydate in
September of the prior year exceeds the dollar limit for a highly compensated
employee for the plan year under Section 414(q) of the Code.

provided that such employees are eligible to participate in any of the qualified
(as determined under Code Section 401(a)) savings plans maintained by the
Corporation or its subsidiaries, other than a plan as may be designated by the
Corporation from time to time (the “Qualified Savings Plans”).

Notwithstanding the foregoing provisions, a new employee of the Corporation or a
participating affiliate who is in Career Band 6 or above is first eligible to
participate in the Plan on the day enrollment materials are sent to him by the
Corporation,

(b) For plan years beginning before January 1, 2006, the following employees
were eligible to participate in the Executive Supplemental Savings Plan: those
highly compensated

 

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employees of the Corporation and its subsidiaries within the meaning of Section
414(q) of the Code in Career Band 6 and above who were eligible to participate
in any of the qualified (as determined under Code Section 401(a)) savings plans
maintained by the Corporation or its subsidiaries, other than any such plan
maintained by Pittway Corporation and its affiliates or by Honeywell Inc. prior
to April 1, 2000, Pittway Corporation (or its successors) prior to January 1,
2004, or such other plans as may have been designated by the Corporation from
time to time, were eligible to participate in the Executive Supplemental Savings
Plan.

2.

Definitions

Capitalized terms not otherwise defined in the Plan have the respective meanings
set forth in the applicable Qualified Savings Plans.

3.

Participation

(a) Time and Form of Election.

Effective for plan years beginning on or after January 1, 2005, an eligible
employee may become a participant in the Plan or the Executive Supplemental
Savings Plan, as applicable (a “Participant”) by filing a timely written or
electronic deferral election with the Plan Administrator (as defined in Section
10(a)) for the applicable plan year. Such election shall direct that a portion
(determined in accordance with paragraph 4(a)) of the base annual salary
exclusive of shift differentials, overtime or other premium pay, bonus,
incentive or other extra compensation, but inclusive of severance pay for
participants whose last day of active employment with the Corporation and its
affiliates occurs before July 1, 2005 (unless otherwise specifically excluded by
the severance pay plan) or salary deferred for the plan year under this Plan or
the Executive Supplemental Savings Plan, as applicable, or otherwise (“Base
Annual Salary”), which would have been payable to such Participant during such
plan year, in lieu of such payment, be credited to a deferred compensation
account maintained under the Plan as an unfunded book entry stated as a cash
balance (the “Participant’s Account”).

As permitted by IRS Notice 2005-1, an eligible employee who made no election
during the Open Enrollment Period for the 2005 plan year was permitted to file a
deferral election with the Plan Administrator (as defined in Section 10(a)) for
the 2005 plan year during a second Open Enrollment Period that began no earlier
than January 1, 2005 and ended no later than March 15, 2005. Such election was
effective only for Base Annual Salary paid for services performed after the
election was filed.

Amounts so credited to the Participant’s Account shall constitute “Participant
Deferred Contributions.”

A new employee of the Corporation or a participating subsidiary who is employed
in Career Band 6 or above may become a participant in the Plan by filing with
the Plan Administrator (as defined in Section 10(a)) a timely written deferral
election that complies with the first paragraph above no later than 30 days
after such employee is first eligible to participate in the Plan. Such election
may only apply to Base Annual Salary paid for services to be performed after the
election is filed.

(b) Change of Amount Deferred. Except as otherwise may be permitted by Section
409A of the Code and the Corporation, for plan years beginning on or after
January 1, 2006, a Participant may not modify his deferral election at any time
during the plan year.

 

 

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4.

Contributions to Participants’ Accounts

(a) Participant Deferred Contributions. For plan years beginning on or after
January 1, 2006, a Participant may elect to defer an aggregate amount equal to
(1) the difference between the maximum percentage of Base Annual Salary that the
Participant may contribute for the plan year as Before-Tax Contributions under
the Qualified Savings Plans (8% for 2006), without regard to any other
limitations which may apply under the Code, and the actual Before-Tax
Contributions the Participant contributes to the Qualified Savings Plans for the
plan year, or (2) the difference between a full percentage of such Participant’s
Base Annual Salary from 1% to 35%, without regard to any other limitations which
may apply under the Code, and the full amount of Before-Tax Contributions and
After-Tax Contributions made by such Participant under the Qualified Savings
Plans for the plan year; provided, however, that a Participant who elects to
defer any amount hereunder shall be required to make the maximum Before-Tax
Contributions permissible under the Qualified Savings Plans for the applicable
Plan Year (after giving effect to deferrals under the Plan or otherwise).

(b) Plan Employer Contributions. There shall be credited to the Participant’s
Account employer contributions under the Plan (“Plan Employer Contributions”) in
an aggregate amount equal to (i) minus (ii), where (i) is 50% (for participants
entitled to a 50% Employer Contribution in the Qualified Savings Plans) or 100%
(for participants entitled to a 100% Employer Contribution in the Qualified
Savings Plans) of the lesser of (x) 8% of the Participant’s Base Annual Salary,
or (y) the sum of the Participant’s Participant Contributions under the
Qualified Savings Plans and Participant Deferred Contributions under the Plan,
expressed as a percentage of Base Annual Salary, and (ii) is the total amount of
Employer Contributions made with respect to the Participant under the Qualified
Savings Plans; provided, however, that in no event shall the combined Plan
Employer Contributions and Employer Contributions made with respect to the
Participant exceed 8% of the Participant’s Base Annual Salary, and provided,
further, that Plan Employer Contributions shall not be made with respect to a
Participant during any period of suspension of Employer Contributions with
respect to such Participant under the terms of the Qualified Savings Plans,
whether or not such Participant continues to make Participant Contributions
under the Qualified Savings Plans during the period of such suspension.

(c) Vesting. Participant Deferred Contributions, Plan Employer Contributions
(collectively “Total Contribution Amounts”) and all amounts accrued with respect
to Total Contribution Amounts in accordance with Section 5, shall be vested at
the time such amounts are credited to the Participant’s Account.

(d) All Contributions Prorated. Total Contribution Amounts shall be credited to
a Participant’s Account each pay period.

5.

The Participant’s Account

Participant Deferred Contributions shall be credited to the Participant’s
Account under the Plan as unfunded book entries stated as cash balances.

Participant Deferred Contributions credited to the Participant’s Account after
December 31, 2004, and all Participant Deferred Contributions credited to a
Participant’s Account under the Supplemental Savings Plan before January 1,
2006, shall accrue amounts (to be posted each Valuation Date) equivalent to
interest, compounded daily, at a rate based upon the cost to the Corporation of
borrowing at a fixed rate for a 15-year term; provided however that, for 2005,

 

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Participant Deferred Contributions credited to the Executive Supplemental
Savings Plan between January 1, 2005 and December 31, 2005 shall accrue amounts
(to be posted each Valuation Date) equivalent to interest, compounded daily, at
a rate equal to 8%. The 15-year corporate borrowing rate referred to in the
preceding sentence shall be determined annually by the Chief Financial Officer
of the Corporation in consultation with the Treasurer of the Corporation.

Participant Deferred Contributions credited to the Participant’s Account under
the Executive Supplemental Savings Plan prior to January 1, 1994 or after the
Participant has terminated employment shall accrue amounts (to be posted each
Valuation Date) equivalent to interest, compounded daily, at a rate based upon
the cost to the Corporation of borrowing at a fixed rate for a 15-year term.
Such rate shall be determined annually by the Chief Financial Officer of the
Corporation in consultation with the Treasurer of the Corporation.

Participant Deferred Contributions credited to the Participant’s Account under
the Executive Supplemental Savings Plan between January 1, 1994 and December 31,
2004, but before a Participant terminates employment, shall accrue amounts (to
be posted each Valuation Date) equivalent to interest, compounded daily, at a
rate determined annually by the Management Development and Compensation
Committee (the “Committee”) of the Board of Directors (the “Board”) of the
Corporation. The rate established in the preceding sentence shall not exceed the
greater of (i) 10% (8% for Participant Deferred Contributions credited on or
after January 1, 2004 and such other percentage that may be established by the
Committee for subsequent calendar years), or (ii) 200% of the 10-year U.S.
Treasury Bond rate at the time of determination and, once established for a
calendar year, shall remain in effect with respect to all Participant Deferred
Contributions credited to the Participant’s Account during such calendar year
until such amounts are distributed.

Plan Employer Contributions shall be credited to the Participant’s Account under
the Plan as unfunded book entries stated as shares of Common Stock (including
fractional shares). The number of shares of Common Stock credited to a
Participant’s Account shall be determined by dividing the equivalent cash amount
(as determined under Section 4(b)) by the closing price of Common Stock on the
day that such Plan Employer Contributions are credited to the Participant’s
Account. Amounts equivalent to the dividends that would have been payable in
respect of the Common Stock shall be credited to the Participant’s Account as if
reinvested in Common Stock, with the number of shares credited determined by
dividing the equivalent cash dividend amount by the closing price of Common
Stock on the date the dividends would have been payable. Amounts credited to the
Participant’s Account shall accrue amounts equivalent to interest and dividends,
as the case may be, until distributed in accordance with the Plan.

6.

Distribution from Accounts

 

(a) Form and Timing of Payment.

(i) Participant Deferred Contributions. For plan years beginning on or after
January 1, 2006, the aggregate amount of the Participant’s Deferred
Contributions, plus earnings credited thereon pursuant to Section 5
(collectively, the “Participant Deferred Contribution Amounts”), credited to the
Participant’s Account pursuant to such election shall be paid in one lump-sum
payment; provided, however, that the Participant may elect to receive a number
of annual installments (up to ten installments) if he terminates employment with
the Corporation and its affiliates after he attains age 55 and is credited with
at least ten years of service with the Corporation and its affiliates. The
lump-sum payment or the first installment shall be paid in

 

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cash no later than January 31st of the calendar year immediately following the
year in which the Participant terminates employment with the Corporation and its
affiliates. Subsequent installments shall be paid in cash no later than January
31st of each succeeding calendar year until the entire amount of the Participant
Deferred Contribution Amounts has been paid. The amount of each installment
shall be determined by multiplying the balance of the Participant Deferred
Contribution Amounts each year by a fraction, the numerator of which is one and
the denominator of which is (A) the number of installments elected, reduced by
(B) one for each annual installment previously received.

For the plan year beginning on January 1, 2005, the Participant Deferred
Contribution Amounts credited to the Participant’s Account pursuant to such
election shall be paid in one lump-sum payment. The lump-sum payment shall be
paid in cash no later than January 31st of the calendar year immediately
following the year in which the Participant terminates employment with the
Corporation and its affiliates.

Notwithstanding the preceding paragraphs, a distribution to a “key employee” on
account of such employee’s separation from service shall not occur or begin
until at least six months have passed between the separation from service date
(or, if earlier, the date of death) and the distribution date. If, because of
this restriction, the key employee cannot receive a distribution by the January
31st of the calendar year immediately following the year in which he incurs a
separation from service, such distribution shall occur or begin no later than
January 31st of the second calendar year following the year in which the
Participant incurs a separation from service. For purposes of the Plan, the term
“key employee” is defined in Section 409A of the Code and shall be determined at
the time and in the manner required or permitted by Section 409A of the Code and
regulations promulgated thereunder.

For plan years beginning before January 1, 2005, the Participant made an
election at the time the Participant made a deferral election for such years,
with respect to the distribution of the Participant Deferred Contribution
Amounts, credited to the Participant’s Account pursuant to such election. A
Participant elected to receive such amount in one lump-sum payment or in a
number of annual installments (up to fifteen installments). The lump-sum payment
or the first installment shall be paid in cash as soon as practicable during the
month of January of such future calendar year as the Participant may designate
or, if the Participant so elects, as soon as practicable during the month of
January of the calendar year immediately following the later of the year in
which the Participant last contributed to the Plan or the year in which the
Participant terminates employment with the Corporation or any of its
subsidiaries (whether by reason of Retirement or otherwise). Except as otherwise
provided in Section 8, subsequent installments shall be paid in cash as soon as
practicable during the month of January of each succeeding calendar year until
the entire amount of the Participant Deferred Contribution Amounts shall have
been paid. The amount of each installment shall be determined by multiplying the
balance of the Participant Deferred Contribution Amounts each year by a
fraction, the numerator of which is one and the denominator of which is (A) the
number of installments elected, reduced by (B) one for each annual installment
previously received.

(ii) Plan Employer Contributions. The distribution form and timing that apply to
the Participant’s Deferred Contribution Amounts for a plan year pursuant to
subsection (i) above shall also apply to the form and timing of the distribution
of the aggregate number of shares of Common Stock representing the Plan Employer
Contributions plus reinvested dividends pursuant to Section 5 (collectively the
“Plan Employer Contribution Amounts”) credited to the Participant’s Account
pursuant to Section 5. Except to the extent otherwise provided with respect to
fractional shares, all distributions of Plan Employer Contribution Amounts shall
be

 

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made in Common Stock. Except as otherwise provided in Section 8, installments
after the first installment payment, if applicable, shall be paid no later than
January 31st of each succeeding calendar year until the entire amount of the
Plan Employer Contribution Amounts shall have been paid. The amount of each
installment shall be determined by (A) multiplying the balance of the Plan
Employer Contribution Amounts on the last Valuation Date of each year by a
fraction, the numerator of which is one and the denominator of which is (x) the
number of installments elected, reduced by (y) one for each annual installment
previously received, and (B) rounding the result down to the next whole share of
Common Stock; provided, however, the amount of the last installment shall be
determined without regard to the rounding requirement of the preceding portion
of this sentence. Any fractional shares of Common Stock shall be paid in an
equivalent cash amount, as determined using the closing price of Common Stock on
the trading date next preceding the distribution date.

(b) Adjustment of Method of Distribution. For plan years beginning on or after
January 1, 2005, a Participant may not change the timing or payment form of
distribution of the Participant Deferred Contribution Amounts or the Plan
Employer Contribution Amounts credited to the Participant’s Account for any such
plan year.

For plan years beginning before January 1, 2005, prior to the beginning of any
calendar year, a Participant may elect to change the timing and method of
distribution of the Participant Deferred Contribution Amounts and Plan Employer
Contribution Amounts credited to the Participant’s Account commencing with such
calendar year. Participant Deferred Contribution Amounts and Plan Employer
Contribution Amounts credited to the Participant’s Account prior to the
effective date of such change (the “Prior Balance”), and all amounts thereafter
accrued with respect to the Prior Balance, shall not be affected by such change
and, except as otherwise provided in this Section 6 or as determined by the Plan
Administrator pursuant to Section 8, shall be distributed only in accordance
with the election in effect at the time such Prior Balance was credited to the
Participant’s Account. Notwithstanding the foregoing provisions of this
paragraph, a Participant’s right to change the timing and method of distribution
shall be suspended from January 1, 2005 to November 7, 2005 or such later date
determined by the Corporation.

(c)(i)  Distribution Default for Participant Deferred Contribution Amounts. Any
Participant Deferred Contribution Amounts credited to a Participant’s Account
for plan years beginning before January 1, 2005 which are not covered by a
timely distribution election under subsections (a) and (b) above shall be
distributed to the Participant in one lump-sum cash payment as soon as
practicable during the month of January of the calendar year immediately
following the later of the year in which the Participant last contributed to the
Plan or the year in which the Participant terminates his employment with the
Corporation or any of its subsidiaries (whether by reason of Retirement or
otherwise); provided, however, if the Participant has made an election pursuant
to Sections 9(a)(i) or 9(a)(ii), the lump sum payment shall be made within the
90-day period following a Change in Control, as defined in Section 9(c).

(c)(ii)  Distribution Default for Plan Employer Contribution Amounts. Any Plan
Employer Contribution Amounts credited to a Participant’s Account which are not
covered by a timely distribution election under subsections (a) and (b) above
shall be distributed to the Participant in Common Stock as soon as practicable
during the month of January of the calendar year immediately following the later
of the year in which the Participant last contributed to the Plan or the year in
which the Participant terminates his employment with the Corporation or any of
it subsidiaries (whether by reason of Retirement or otherwise); provided,
however, if the Participant has made an election pursuant to Sections 9(a)(i) or
(ii), the distribution shall be

 

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made within the 90-day period following a Change in Control, as defined in
Section 9(c). Any fractional shares of Common Stock shall be paid in an
equivalent cash amount, as determined using the closing price of Common Stock on
the trading date next preceding the distribution date.

(d) Changing Prior Distribution Elections. For amounts attributable to plan
years beginning before January 1, 2005, the Plan Administrator may from time to
time allow Participants to request new elections with respect to the
distribution of a Participant’s Prior Balance under the Plan (other than with
respect to any such Prior Balance for which distributions have already
commenced). The Plan Administrator shall reserve the right to accept or reject
any such request at any time and such election shall be subject to such
restrictions and limitations as the Plan Administrator shall determine in its
sole discretion, provided that any new election shall generally be required to
be made at least twelve (12) months prior to any scheduled payment date.
Notwithstanding the foregoing provisions of this paragraph, a Participant’s
right to request a new election shall be suspended from January 1, 2005 to
November 7, 2005 or such later date determined by the Corporation.

For amounts attributable to plan years beginning before January 1, 2005, the
Plan Administrator may also allow a Participant to request an immediate
distribution of all or a portion of such Participant’s Prior Balance (including
any portion of such Prior Balance for which distributions have already
commenced) and any Deferred Contribution Amounts and Plan Employer Contribution
Amounts credited to the Participant’s Account immediately prior to such request.
Any such immediate distribution shall be subject to a penalty equal to six
percent (6%) of the amount requested to be distributed and shall be subject to
the approval of the Plan Administrator and such other restrictions or conditions
as may be established by the Plan Administrator from time to time.
Notwithstanding the foregoing provisions of this paragraph, a Participant’s
right to request an immediate distribution shall be suspended from January 1,
2005 to November 7, 2005 or such later date determined by the Corporation.

(e) Special Distribution Provision. Except as otherwise prohibited by Section
409A of the Code if such Section applies and notwithstanding any provision in
this Plan to the contrary, if all or a portion of a Participant’s Account is
determined to be includible in the Participant’s gross income and subject to
income tax at any time prior to the time such Account would otherwise be paid,
the Participant’s Account or that portion of the Participant’s Account shall be
distributed to the Participant. For this purpose, an amount is determined to be
includible in the Participant’s gross income upon the earliest of: (i) a final
determination by the Internal Revenue Service addressed to the Participant which
is not appealed, (ii) a final determination by the United States Tax Court or
any other federal court affirming an IRS determination, or (iii) an opinion
addressed to the Corporation by the tax counsel for the Corporation that, by
reason of the Code, Treasury Regulations, published Internal Revenue Service
rulings, court decisions or other substantial precedent, the amount is subject
to federal income tax prior to payment.

 

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7.

Distribution on Death

(a) Participant Deferred Contribution Amounts. If a Participant should die
before all Participant Deferred Contribution Amounts credited to the
Participant’s Account have been paid in accordance with Section 6, the balance
of the Participant Deferred Contribution Amounts in such Participant’s Account
shall be paid in cash as soon as practicable following the Participant’s death
to the beneficiary designated in writing by the Participant and filed with the
Plan Administrator; provided, however, if the Participant has made an election
pursuant to Sections 9(a)(i) or 9(a)(ii) for plan years beginning before January
1, 2005, such amount shall be paid within the 90-day period following a Change
in Control, as defined in Section 9(c). If (i) no beneficiary designation has
been made, or (ii) the designated beneficiary shall have predeceased the
Participant and no further designation has been made, then such balance shall be
paid to the estate of the Participant. A Participant may change the designated
beneficiary at any time during the Participant’s lifetime by filing a subsequent
designation in writing with the Plan Administrator.

(b) Plan Employer Contribution Amounts. If a Participant should die before all
Plan Employer Contribution Amounts credited to the Participant’s Account have
been paid in accordance with Section 6, the balance of the Plan Employer
Contribution Amounts in such Participant’s Account shall be paid in Common Stock
as soon as practicable following the Participant’s death to the beneficiary
designated in writing by the Participant and filed with the Plan Administrator;
provided, however, if the Participant has made an election pursuant to Sections
9(a)(i) or 9(a)(ii) for plan years beginning before January 1, 2005, such amount
shall be paid within the 90-day period following a Change in Control, as defined
in Section 9(c). If (i) no such beneficiary designation has been made, or (ii)
the designated beneficiary shall have predeceased the Participant and no further
designation has been made, then such balance shall be paid to the estate of the
Participant. A Participant may change the designated beneficiary at any time
during the Participant’s lifetime by filing a subsequent designation in writing
with the Plan Administrator. Any fractional shares of Common Stock shall be paid
in an equivalent cash amount, as determined using the closing price of Common
Stock on the trading date next preceding the distribution date.

8.

Payment in the Event of Hardship

Beginning January 1, 2006, for amounts attributable to plan years beginning on
or after January 1, 2005, upon receipt of a request from a Participant,
delivered in writing to the Plan Administrator along with a hardship
distribution form, the Plan Administrator, or his designee, may cause the
Corporation to distribute (or require the subsidiary of the participating
company that employs or employed the Participant to distribute) payment of all
or any part of the amount credited to the Participant’s Account, including
accrued amounts, if it finds in its sole discretion that payment of such amounts
in accordance with the distribution form and timing requirements of Section 6
would result in an unforeseeable emergency for the Participant. An
“unforeseeable emergency” means a severe financial hardship to the Participant
resulting from (1) an illness or accident that occurs to the Participant, the
Participant’s spouse or the Participant’s dependent (as defined in section
152(a) of the Code), (2) loss of the Participant’s property due to casualty, or
(3) other similar extraordinary and unforeseeable circumstances arising as a
result of events beyond the Participant’s control.

If a Participant requests a withdrawal due to an unforeseeable emergency, the
amount distributed cannot exceed the amount necessary to satisfy the emergency
and estimated taxes the Participant shall incur as a result of the distribution.
An emergency distribution may not be

 

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made under this Section 8 to the extent that such emergency is or may be
relieved (a) through reimbursement or compensation by insurance or otherwise, or
(b) by liquidation of the Participant’s assets, to the extent the liquidation of
assets would not itself cause severe financial hardship. Any distribution of
Participant Deferred Contribution Amounts pursuant to this Section 8 shall be
made in cash, while any distribution of Plan Employer Contribution Amounts
pursuant to this Section 8 shall be made in Common Stock. Any fractional shares
of Common Stock shall be paid in an equivalent cash amount, as determined using
the closing price of Common Stock on the trading date next preceding the
distribution date.

For amounts attributable to plan years beginning before January 1, 2005, upon
receipt of a request from a Participant, delivered in writing to the Plan
Administrator along with a Certificate of Unavailability of Resources form, the
Plan Administrator, or his designee, may cause the Corporation to accelerate (or
require the subsidiary of the Corporation which employs or employed the
Participant to accelerate) payment of all or any part of the amount credited to
the Participant’s Account, including accrued amounts, if it finds in its sole
discretion that payment of such amounts in accordance with the Participant’s
prior election under Section 6 would result in severe financial hardship to the
Participant, and such hardship is the result of an unforeseeable emergency
caused by circumstances beyond the control of the Participant. Acceleration of
payment may not be made under this Section 8 to the extent that such hardship is
or may be relieved (a) through reimbursement or compensation by insurance or
otherwise, or (b) by liquidation of the Participant’s assets, to the extent the
liquidation of assets would not itself cause severe financial hardship. Any
distribution of Participant Deferred Contribution Amounts pursuant to this
Section 8 shall be made in cash, while any distribution of Plan Employer
Contribution Amounts pursuant to this Section 8 shall be made in Common Stock.
Any fractional shares of Common Stock shall be paid in an equivalent cash
amount, as determined using the closing price of Common Stock on the trading
date next preceding the distribution date. Notwithstanding the foregoing
provisions of this paragraph, a Participant’s right to request a hardship
distribution shall be suspended from January 1, 2005 to November 7, 2005 or such
later date determined by the Corporation.

9.

Change in Control

(a)(i)  Initial Lump-Sum Payment Election. Notwithstanding any election made
pursuant to Section 6, any person who became eligible to participate in the Plan
filed a written election with the Plan Administrator at the time the individual
made an election to participate to have the aggregate amount credited to the
Participant’s Account (commencing with the date on which such written election
is filed) paid in one-lump sum payment as soon as practicable following a Change
in Control, but in no event later than 90 days after such Change in Control. Any
distribution of Participant Deferred Contribution Amounts pursuant to this
Section 9 shall be made in cash, while any distribution of Plan Employer
Contribution Amounts pursuant to this Section 9 shall be made in Common Stock
(or the common stock of any successor corporation issued in exchange for, or
with respect to, Common Stock incident to the Change in Control). Any fractional
shares of Common Stock (or the common stock of any successor corporation issued
in exchange for, or with respect to, Common Stock incident to the Change in
Control) shall be paid in an equivalent cash amount.

(a)(ii) Subsequent Lump-Sum Payment Election. A Participant who did not make an
election pursuant to Section 9(a)(i) or who has revoked, pursuant to Section
9(a)(iii), an election previously made under Section 9(a)(i) or this Section
9(a)(ii) may, prior to the earlier of a Change in Control or the beginning of
the calendar year in which the election is to take effect, elect to have the
aggregate amount credited to the Participant’s Account for all calendar years

 

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commencing with the first calendar year beginning after the date the election is
made, paid in one lump-sum payment as soon as practicable following a Change in
Control, but in no event later than 90 days after such Change in Control.

(a)(iii)  Revocation of Prior Change in Control Payment Elections. A Participant
may, prior to a Change in Control, file an election revoking any election made
pursuant to Sections 9(a)(i) or 9(a)(ii) or file a new lump sum payment election
under this Section 9 with respect to amounts previously credited to the
Participant’s Account. Any such revocation or new election shall be made at the
time specified by the Plan Administrator and shall be subject to such
restrictions and limitations as the Plan Administrator shall determine from time
to time.

(a)(iv) Applicability. The foregoing provisions of this Section 9(a) shall only
apply to amounts attributable to plan years beginning before January 1, 2005.
For amounts attributable to plan years beginning on or after January 1, 2005,
the form and timing of Plan distributions shall be in accordance with the
provisions of Section 6 and such form and timing shall not be changed as a
result of a Change in Control.

(b) Interest Equivalents. Notwithstanding anything to the contrary in the Plan,
after a Change in Control, the Plan may not provide, or be amended to provide,
interest accruals with respect to Participant Deferred Contributions at rates
lower than the rates in effect under Section 5 immediately prior to the Change
in Control.

(c) Definition of Change in Control. For purposes of the Plan, a Change in
Control is deemed to occur at the time (i) when any entity, person or group
(other than the Corporation, any subsidiary or any savings, pension or other
benefit plan for the benefit of employees of the Corporation or its
subsidiaries) which therefore beneficially owned less than 30% of the common
stock then outstanding acquires shares of Common Stock in a transaction or
series of transactions that results in such entity, person or group directly or
indirectly owning beneficially 30% or more of the outstanding Common Stock, (ii)
of the purchase of shares of Common Stock pursuant to a tender offer or exchange
offer (other than an offer by the Corporation) for all, or any part of, the
Common Stock, (iii) of a merger in which the Corporation shall not survive as an
independent, publicly owned corporation, a consolidation, or a sale, exchange or
other disposition of all or substantially all of the Corporation’s assets, (iv)
of a substantial change in the composition of the Board during any period of two
consecutive years such that individuals who at the beginning of such period were
members of the Board cease for any reason to constitute at least a majority
thereof, unless the election, or the nomination for election by the stockholders
of the Corporation, of each new director was approved by a vote of at least
two-thirds of the directors then still in office who were directors at the
beginning of the period, or (v) of any transaction or other event which the
Corporate Governance Committee of the Board, in its discretion, determines to be
a Change in Control for purposes of the Plan.

 

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10.

Administration

(a) Plan Administrator. The Plan Administrator and “named fiduciary” for
purposes of ERISA shall be the Senior Vice President-Human Resources and
Communications of the Corporation (or the person acting in such capacity in the
event such position is abolished, restructured or renamed). The Plan
Administrator shall have the authority to appoint one or more other named
fiduciaries of the Plan and to designate persons, other than named fiduciaries,
to carry out fiduciary responsibilities under the Plan, pursuant to Section
405(c)(1)(B) of ERISA. Any person acting on behalf of the Plan Administrator
shall serve without additional compensation. The Plan Administrator shall keep
or cause to be kept such records and shall prepare or cause to be prepared such
returns or reports as may be required by law or necessary for the proper
administration of the Plan.

(b) Powers and Duties of Plan Administrator. The Plan Administrator shall have
the full discretionary power and authority to construe and interpret the Plan
(including, without limitation, supplying omissions from, correcting
deficiencies in, or resolving inconsistencies or ambiguities in, the language of
the Plan); to determine all questions of fact arising under the Plan, including
questions as to eligibility for and the amount of benefits; to establish such
rules and regulations (consistent with the terms of the Plan) as it deems
necessary or appropriate for administration of the Plan; to delegate
responsibilities to others to assist it in administering the Plan; to retain
attorneys, consultants, accountants or other persons (who may be employees of
the Corporation and its subsidiaries) to render advice and assistance as it
shall determine to be necessary to effect the proper discharge of any duty for
which it is responsible; and to perform all other acts it believes reasonable
and proper in connection with the administration of the Plan. The Plan
Administrator shall be entitled to rely on the records of the Corporation and
its subsidiaries in determining any Participant’s entitlement to and the amount
of benefits payable under the Plan. Any determination of the Plan Administrator,
including interpretations of the Plan and determinations of questions of fact,
shall be final and binding on all parties.

(c) Indemnification. To the extent permitted by law, the Corporation shall
indemnify the Plan Administrator from all claims for liability, loss, or damage
(including payment of expenses in connection with defense against such claims)
arising from any act or failure to act in connection with the Plan.

11.

Claims Procedures and Appeals

(a) Any request or claim for Plan benefits must be made in writing and shall be
deemed to be filed by a Participant when a written request is made by the
claimant or the claimant’s authorized representative which is reasonably
calculated to bring the claim to the attention of the Plan Administrator.

(b) The Plan Administrator shall provide notice in writing to any Participant
when a claim for benefits under the Plan has been denied in whole or in part.
Such notice shall be provided within 90 days of the receipt by the Plan
Administrator of the Participant’s claim or, if special circumstances require,
and the Participant is so notified in writing, within 180 days of the receipt by
the Plan Administrator of the Participant’s claim. The notice shall be written
in a manner calculated to be understood by the claimant and shall:

(i) set forth the specific reasons for the denial of benefits;

 

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(ii) contain specific references to Plan provisions relative to the denial;

(iii) describe any material and information, if any, necessary for the claim for
benefits to be allowed, that had been requested, but not received by the Plan
Administrator; and

(iv) advise the Participant that any appeal of the Plan Administrator’s adverse
determination must be made in writing to the Plan Administrator within 60 days
after receipt of the initial denial notification, and must set forth the facts
upon which the appeal is based.

(c) If the Participant fails to appeal the Plan Administrator’s denial of
benefits in writing and within 60 days after receipt by the claimant of written
notification of denial of the claim (or within 60 days after a deemed denial of
the claim), the Plan Administrator’s determination shall become final and
conclusive.

(d) If the Participant appeals the Plan Administrator’s denial of benefits in a
timely fashion, the Plan Administrator shall re-examine all issues relevant to
the original denial of benefits. Any such claimant, or his or her duly
authorized representative, may review any pertinent documents, as determined by
the Plan Administrator, and submit in writing any issues or comments to be
addressed on appeal.

(e) The Plan Administrator shall advise the Participant and such individual’s
representative of its decision, which shall be written in a manner calculated to
be understood by the claimant, and include specific references to the pertinent
Plan provisions on which the decision is based. Such response shall be made
within 60 days of receipt of the written appeal, unless special circumstances
require an extension of such 60-day period for not more than an additional 60
days. Where such extension is necessary, the claimant shall be given written
notice of the delay.

12.

Miscellaneous

(a) Anti-Alienation. The right of a Participant to receive any amount credited
to the Participant’s Account shall not be transferable or assignable by the
Participant, except by will or by the laws of descent and distribution. To the
extent that any person acquires a right to receive any amount credited to a
Participant’s Account hereunder, such right shall be no greater than that of an
unsecured general creditor of the Corporation. Except as expressly provided
herein, any person having an interest in any amount credited to a Participant’s
Account under the Plan shall not be entitled to payment until the date the
amount is due and payable. No person shall be entitled to anticipate any payment
by assignment, pledge or transfer in any form or manner prior to actual or
constructive receipt thereof.

(b) Unsecured General Creditor. Neither the Corporation nor any of its
subsidiaries shall be required to reserve or otherwise set aside funds, Common
Stock or other assets for the payment of its obligations hereunder. However, the
Corporation or any subsidiary may, in its sole discretion, establish funds for
payment of its obligations hereunder. Any such funds shall remain assets of the
Corporation or such subsidiary, as the case may be, and subject to the claims of
its general creditors. Such funds, if any, shall not be deemed to be assets of
the Plan. The Plan is intended to be unfunded for tax purposes and for purposes
of Title I of the Employee Retirement Income Security Act of 1974, as amended.

(c) Withholding. The Corporation shall withhold from any distribution made from
Participant Deferred Contribution Amounts the amount necessary to satisfy
applicable federal,

 

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state and local tax withholding requirements. With respect to distributions of
Plan Employer Contribution Amounts, the delivery of the shares of Common Stock
shall be delayed until the Participant makes arrangements, pursuant to
procedures to be adopted by the Plan Administrator, to satisfy the applicable
federal, state and local tax withholding requirements.

(d) Termination and Amendment. The Corporation may at any time amend or
terminate the Plan. Notwithstanding the foregoing, the Plan may not, without the
consent of an affected Participant, be amended in any manner which would (i)
adversely affect such Participant’s rights and expectations with respect to
Deferred Amounts credited to such Participant’s Account immediately prior to
such amendment (including, but not limited to, any amendment which would
adversely affect the rights or features applicable to, or any of the components
that are taken into account in determining, the Deferred Amount of any
Participant hereunder) or, (ii) with respect to any Participant whose employment
terminates either during a Potential Change in Control Period or within two
years following a Change in Control under circumstances entitling such
Participant to severance benefits under the Corporation’s Severance Plan for
Corporate Staff Employees or Part II of the Corporation’s Severance Plan for
Senior Executives, adversely affect such Participant’s rights and expectations
with respect to amounts that would otherwise have been credited to such
Participant’s Account as a result of the election of such Participant to defer
the receipt of severance payments pursuant to such plan. For purposes of the
preceding sentence, a “Potential Change in Control Period” shall commence when:
(A) the Corporation enters into an agreement, the consummation of which would
result in the occurrence of a Change in Control; (B) the Corporation or any
person or group publicly announces an intention to take or to consider taking
actions which, if consummated, would constitute a Change in Control; (C) any
person or group (other than the Corporation, any subsidiary or any savings,
pension or other benefit plan for the benefit of employees of the Corporation or
its subsidiaries) becomes the beneficial owner, directly or indirectly, of
securities of the Corporation representing 15% or more of either the then
outstanding shares of common stock of the Corporation or the combined voting
power of the Corporation’s then outstanding securities (not including in the
securities beneficially owned by such person or group any securities acquired
directly from the Corporation or its affiliates); or (D) the Board adopts a
resolution to the effect that, for purposes of the Plan, a Potential Change in
Control Period has commenced. The Potential Change in Control Period shall
continue until the earlier of (I) a Change in Control or (II) the adoption by
the Board of a resolution stating that, for purposes of the Plan, the Potential
Change in Control Period has expired.

(e) Benefit Statements. Each Participant shall receive periodic statements (not
less frequently than annually) regarding the Participant’s Account. Each such
statement shall indicate the amount of the balances credited to the
Participant’s Account as of the end of the period covered by such statement.

(f) Legal Interpretation. This Plan and its provisions shall be construed in
accordance with the laws of the State of Delaware to the extent such Delaware
law is not inconsistent with the provisions of ERISA. The text of this Plan
shall, to the extent permitted by law, govern the determination of the rights
and obligations created or referred to herein. Headings to the Sections,
paragraphs and subparagraphs are for reference purposes only and do not limit or
extend the meaning of any of the Plan’s provisions.

(g) Employment. The adoption and maintenance of this Plan shall not be deemed to
constitute a contract between the Corporation or its subsidiaries and any
employee or to be a

 

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consideration for or condition of employment of any person. No provision of the
Plan shall be deemed to give any employee the right to continue in the employ of
the Corporation or its subsidiaries or to interfere with the right of the
Corporation or its subsidiaries to discharge any employee at any time without
regard to the effect which such discharge might have upon the employee's
participation in the Plan or benefits under it.

(h) Fiduciary Capacities. Any person or group of persons may serve in more than
one fiduciary capacity with respect to the Plan. For purposes of this Section
12(h), the term “fiduciary” shall have the same meaning as in ERISA.

(i) Participants Subject to Section 16. Notwithstanding anything herein to the
contrary, if any request, election or other action under the Plan affecting a
Participant subject to Section 16 of the Securities Exchange Act of 1934 should
require the approval of the Committee to exempt such request, election or other
action from potential liability under Section 16, then the approval of the
Committee shall be obtained in lieu of the approval of the Plan Administrator.

IN WITNESS WHEREOF, pursuant to the authority granted to me by the Management
Development and Compensation Committee of the Board of Directors on July 29,
2005, the Plan is hereby amended this 17th day of October, 2005.

 

 

 

 

 

/s/ Thomas Weidenkopf

 

 

By: 

THOMAS WEIDENKOPF
Honeywell International Inc.
Senior Vice President – Human Resources
and Communications

 

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