Honeywell 2005 Annual Report Download - page 235

Exhibit 10.24
SCHEDULE 3.01(b)
DISCLOSED LITIGATION
While not giving an opinion as to whether any item is "reasonably likely to have a Material Adverse Effect," we hereby disclose the litigation matters as
stated in our Form 10-Q for the quarter ended June 30, 2005, as follows.
ERISA Class Action Lawsuit – Honeywell and several of its current and former officers and directors are defendants in a purported class action lawsuit
filed in the United States District Court for the District of New Jersey. The complaint principally alleges that the defendants breached their fiduciary duties to
participants in the Honeywell Savings and Ownership Plan (the "Savings Plan") by purportedly making false and misleading statements, failing to disclose
material information concerning Honeywell's financial performance, and failing to diversify the Savings Plan's assets and monitor the prudence of Honeywell
stock as a Savings Plan investment. Honeywell has agreed to settle this matter for $14 million plus an agreement to permit Savings Plan participants greater
diversification rights. The settlement will be paid in full by Honeywell's insurers. The settlement was approved by the Court in July 2005.
Environmental Matters – We are subject to various federal, state, local and foreign government requirements relating to the protection of the
environment. We believe that, as a general matter, our policies, practices and procedures are properly designed to prevent unreasonable risk of environmental
damage and personal injury and that our handling, manufacture, use and disposal of hazardous or toxic substances are in accord with environmental and safety
laws and regulations. However, mainly because of past operations and operations of predecessor companies, we, like other companies engaged in similar
businesses, have incurred remedial response and voluntary cleanup costs for site contamination and are a party to lawsuits and claims associated with
environmental and safety matters, including past production of products containing toxic substances. Additional lawsuits, claims and costs involving
environmental matters are likely to continue to arise in the future.
With respect to environmental matters involving site contamination, we continually conduct studies, individually or jointly with other potentially
responsible parties, to determine the feasibility of various remedial techniques to address environmental matters. It is our policy to record appropriate
liabilities for environmental matters when remedial efforts or damage claim payments are probable and the costs can be reasonably estimated. Such liabilities
are based on our best estimate of the undiscounted future costs required to complete the remedial work. The recorded liabilities are adjusted periodically as
remediation efforts progress or as additional technical or legal information becomes available. Given the uncertainties regarding the status of laws,
regulations, enforcement policies, the impact of other potentially responsible parties, technology and information related to individual sites, we do not believe
it is possible to develop an estimate of the range of reasonably possible environmental loss in excess of our accruals. We expect to fund expenditures for these
matters from operating cash flow. The timing of cash expenditures depends on a number of factors, including the timing of litigation and settlements of
remediation liability, personal injury and property damage claims, regulatory approval of cleanup projects, remedial techniques to be utilized and agreements
with other parties.