Honeywell 2008 Annual Report Download - page 167

(2) The rate of notional interest established by the Committee shall be set forth on Schedule A attached hereto and made a part
hereof. Any portion of such rate designated as “Vested Rate” on such Schedule A shall be nonforfeitable at all times. Any portion
of such rate designated as “Contingent Rate” on such Schedule A shall become nonforfeitable only if the Employee is still
employed by the Company at the end of the third full calendar year following the calendar year to which the Award relates;
provided, however, that in the event an Employee terminates employment with the Company as a result of early or normal
retirement (as defined in the qualified pension plan in which the Employee participates), death or disability (determined in the
same manner as under the AlliedSignal Voluntary Employees Beneficiary Association Long-Term Disability Income Plan), no
portion of such rate shall be treated as “Contingent”, even if such retirement, death or disability occurs prior to the end of the third
full calendar year following the calendar year to which the Award relates. The rate established by the Committee and set forth on
Schedule A shall remain in effect until superceded by action of the Committee and amendment of such Schedule A.
(3) When an Award is made, the Company shall cause the cash to be paid to the individual to whom the Award is made at the
time or times specified by the Committee or the Chief Executive Officer, as appropriate, or, if no time or times is specified, as
soon as practicable after the Award is made.
(4) When circumstances are deemed justifiable by the Committee, it may, upon agreement with the Employee or the
Employee’s estate or designee, authorize an immediate lump sum payment in cancellation of all or any part of any outstanding
deferred Award, authorize a change in the number of installments in which a deferred Award is to be paid or authorize a change in
the time of payment of any unpaid installments. Any such lump sum payments shall be equal to the amount of the unpaid
installments canceled plus any accrued notional interest.
(5) Notwithstanding the foregoing, in the event an Employee’s employment with the Company is terminated either voluntarily
or for “gross cause” (as defined in the Severance Pay Plan for Designated Career Band 5 Employees of AlliedSignal Inc. or in the
AlliedSignal Severance Pay Plan for Senior Executives, as applicable), the nonforfeitable portion of such Employee’s deferred
Awards shall be distributed in a lump sum as soon as practicable after such termination of employment.
B. This Section VIII B shall apply to all Incentive Compensation Awards other than Grandfathered Awards. Incentive
Compensation Awards shall be paid in full in one lump sum as soon as practicable following the end of the fiscal year in which the
Incentive Compensation Award was earned, but no later than the 15th day of the third month following the end of such year, provided
that, except as provided in the second paragraph of Section V, the recipient Employee is still actively employed by the Company on
the date the Incentive Compensation Award is paid. Notwithstanding the foregoing, the Committee may, in its sole discretion, and
with respect to “covered employees” subject to Section 162(m) of the Code,
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