Honeywell 2008 Annual Report Download - page 308

subject to Section 7.14, pursuant to the terms and conditions that the Committee, in its discretion, may determine and set forth in the Award
Agreement, subject to the provisions below:
(a) Grant of Restricted Units. The Committee may grant Restricted Units to any Employee, which Units are denominated in, payable in,
valued in whole or in part by reference to, or otherwise related to, Shares. The Committee will determine, in its discretion, the terms and
conditions that will apply to Restricted Units granted pursuant to this Section 4.5, including whether Dividend Equivalents will be credited
with respect to any Award. The terms and conditions of the Restricted Units will be set forth in the applicable Award Agreement.
(b) Grant of Restricted Stock. As soon as practicable after Restricted Stock has been granted, certificates for all Shares of Restricted
Stock will be registered in the name of the Participant and held for the Participant by the Company. The Participant will have all rights of a
shareowner with respect to the Shares, including the right to vote and to receive dividends or other distributions, except that the Shares
may be subject to a vesting schedule and forfeiture and may not be sold, transferred, assigned, pledged or otherwise encumbered or
disposed until the restrictions are satisfied or lapse.
(c) Dividends and Dividend Equivalents. At the discretion of the Committee determined at the time of grant, dividends issued on Shares
of Restricted Stock may be paid immediately or withheld and deferred in the Participant's account. In the event of a payment of dividends
on Common Stock, to the extent permissible under Section 409A of the Code, the Committee may credit Restricted Units with Dividend
Equivalents. Dividend Equivalents may be distributed immediately or withheld and deferred in the Participant's account, as determined by
the Committee at the time of grant of the relevant Restricted Units. The Committee will determine any terms and conditions on deferral,
including the rate of interest to be credited on deferrals and whether interest will be compounded.
(d) Vesting and Forfeiture. The Committee may, in its discretion and as set forth in the Award Agreement, impose any restrictions on
Restricted Units or Restricted Stock that it deems to be appropriate. The Committee has discretion to provide for an incremental lapse of
restrictions or for a lapse of restrictions upon satisfaction of certain conditions. Unless the applicable Award Agreement provides otherwise,
the Restricted Units and Restricted Stock will be subject to the following vesting restrictions:
(i) Vesting and Forfeiture. Except for Restricted Units and Restricted Stock granted as Performance Awards and except as provided
in Section 5.1, restrictions on Restricted Units and Restricted Stock will vest, in the discretion of the Committee, over a period of not
less than three years from the date of grant. If the restrictions have not lapsed or been satisfied as of the Participant's Termination of
Employment, the Restricted Units or Restricted Stock will be forfeited by the Participant if the termination is for any reason other than
Full Retirement, death, Disability or Change in Control.