Early Retirement Agreement (31K)
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EARLY RETIREMENT AGREEMENT
EARLY RETIREMENT AGREEMENT (this "Agreement"), dated as of July 3,
2001, by and between Honeywell International, Inc., a Delaware corporation (the
"Company"), and Michael R. Bonsignore ("Executive").
WHEREAS, Executive has expressed his intention to retire from
employment with the Company and, in connection with his retirement, the Company
and Executive have determined to settle all of their respective rights and
obligations in respect of his Employment Agreement (as defined below) and other
matters pertaining to Executive's services with the Company;
NOW, THEREFORE, in consideration of their mutual promises, the Company
and Executive agree as follows:
1. Retirement and Resignation. Effective as of the date hereof (the
"Effective Date"), the Executive shall retire from active employment and hereby
resigns, effective as of the Effective Date, (i) as Chairman of the Board of
Directors and Chief Executive Officer of the Company and (ii) from employment
with and as a member of the Board of Directors of the Company and each of its
subsidiaries and affiliates.
2. Provision of Consulting Services. During the period beginning on the
Effective Date and continuing until the second anniversary of the Effective Date
(the "Consulting Period"), the Executive shall provide consulting services
commensurate with his status and experience with respect to matters related to
strategic acquisitions as shall be reasonably requested from time to time by the
Chairman of the Board of Directors of the Company. The Executive shall provide
consulting services to Company as needed and when reasonably requested, provided
that, without his prior consent, Executive shall not be required to devote more
than 50 hours in any calendar month to the performance of any consulting
services hereunder. The Executive shall determine the time and location at which
he shall perform such services, subject to the right of the Company to
reasonably request by advance written notice that such services be performed at
a specific time and at a specific location. The Executive shall honor any such
request unless he has a conflicting business commitment that would preclude him
from performing such services at the time and/or place requested by the Company,
and in such circumstances shall make reasonable efforts to arrange a mutually
satisfactory alternative. The Company shall use its reasonable best efforts not
to require the performance of consulting services in any manner that
unreasonably interferes with any other business activity of the Executive.
3. Cancellation of the Employment Agreement. The Executive and the
Company are parties to an Employment Agreement (the "Employment
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Agreement"), dated and effective as of December 1, 1999. The term of the
Employment Agreement would have expired December 31, 2004. The Employment
Agreement is hereby canceled and the parties shall have no further obligations
to each other thereunder except as specifically provided in this Agreement.
4. Unpaid Accrued Benefits. The Company shall promptly pay to the
Executive any portion of the Executive's base salary, and accrued but unused
vacation, through the Effective Date that has not yet been paid. The Executive
shall receive second quarter 2001 dividends with respect to his Restricted Units
(as defined in the Employment Agreement). In addition, Executive shall be paid,
at the time annual cash bonuses are paid to other senior executive officers of
the Company in accordance with the Company's Incentive Compensation Plan for
Executive Employees, a prorated annual cash bonus in an amount equal to the
product of (i) the annual cash bonus that would have been payable to Executive
for 2001 under such plan had Executive not terminated his employment with the
Company based solely on the Company's performance factor (and without regard to
any other adjustment permitted under such plan) times (ii) a fraction, the
numerator of which is the number of days during 2001 prior to and including the
date of Executive's retirement in accordance with Section 1, and the denominator
of which is 365. The Company shall also pay or provide to the Executive all
compensation and benefits due and payable to the Executive, or as to which the
Executive has vested rights (including, without limitation, rights as a retiree
of the Company based on his age and service), in accordance with the terms and
conditions of the Company's compensation and benefit plans, programs or
arrangements as in effect immediately prior to the Effective Date (except as
otherwise expressly provided in the Agreement).
5. Retirement Benefits.
(a) Separation Payment. Executive shall be entitled to a separation
payment (the "Separation Payment") in an amount equal to three times the sum of
his annual base salary, as in effect immediately prior to the Effective Date,
plus his Minimum Target Bonus (as defined in the Employment Agreement). The
Separation Payment shall be paid in one lump-sum payment on January 2, 2002 (the
sum of Executive's annual base salary and Minimum Target Bonus is hereafter
referred to as his "Annual Cash Compensation").
(b) SERP Benefit.
(i) Subject to the terms and conditions set forth herein, the
Executive shall receive a supplemental retirement benefit (the "SERP
Benefit"), in the form of an unreduced 100% joint and survivor annuity
for his life and that of his current spouse, with the annual benefit
equal to (1) the product of (A) 70% times (B) the Executive's Annual
Cash Compensation reduced by (2) the actuarial equivalent value of the
aggregate annual vested benefit (expressed as a life annuity commencing
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