Honeywell 2008 Annual Report Download - page 166

equal to 0.4% of Consolidated Earnings for such year. The maximum Incentive Compensation Award payable with respect to any
fiscal year to any other Employee shall be equal to 0.2% of Consolidated Earnings for such year. If the total of the maximum Incentive
Compensation Awards determined pursuant to this paragraph VI for Senior Executive Employees would otherwise exceed 2% of
Consolidated Earnings for a fiscal year, then each individual maximum shall be reduced pro-rata so that in the aggregate their total
equals 2% of Consolidated Earnings.
Incentive Compensation Awards may be made either at or following the end of the fiscal year to which they relate; provided,
however, that no Incentive Compensation Awards shall be made to Senior Executive Employees prior to receipt by the Chief
Executive Officer of assurances from the Chief Financial Officer and the Company’s independent accountants that the amount which
the Board of Directors has determined shall be credited to the Reserve for the fiscal year to which the Awards relate is not greater than
the maximum amount permitted under Section IV.
B. Long-Term Awards. These are Awards based on achievement of long-term objectives established by the Board of Directors or
the Committee for this purpose for each long-term performance period.
Long-term performance periods will cover a period longer than one fiscal year. Long-term objectives will be established in terms
of some measurable standard determined by the Board of Directors or the Committee for each period.
The Employee’s individual performance and contribution to the achievement of established objectives will be considered in
determining the amount of an Award.
No Long-Term Awards shall be granted under the Plan after December 31, 2003. All Long-Term Awards granted under the Plan
prior to December 31, 2003 and outstanding as of December 31, 2004 were earned and vested in full as of December 31, 2004.
VII. Form of Awards
Awards under the Plan shall be made in cash.
VIII. Payment of Awards
A. This Section VIII A shall apply to Grandfathered Awards only.
(1) Awards under the Plan shall be paid currently, unless the Committee shall determine that any Award shall be deferred.
Deferred Awards may be made in one lump sum or in installments and may accrue notional interest, all as the Committee shall
determine; provided, however, that the rate of notional interest shall not exceed the greater of (i) 10% or (ii) 200% of the 10-year
U.S. Treasury Bond rate at the time of determination, and interest shall be compounded daily. An individual to whom an Award
has been made shall not have any interest in the cash until the cash has been paid.
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