EX-10 7 ex10-13.txt EXHIBIT 10.13 Exhibit 10.13 Honeywell Memorandum Date: February 10, 2004 To: J. Kevin Gilligan From: Thomas W. Weidenkopf Subject: Employment Separation Agreement and Release This Employment Separation Agreement and Release ("Agreement and Release") confirms our mutual understanding regarding your rights and benefits under the Honeywell International Inc. Severance Plan for Senior Executives ("Senior Severance Plan") incident to your termination of employment with Honeywell International Inc., its predecessor companies, affiliates, subsidiaries and business units, past and present ("Honeywell" or the "Company"). By signing this Agreement and Release, you hereby acknowledge that these benefits are in full satisfaction of all rights to termination or severance related benefits for which you may have been eligible or may claim to be eligible under any agreement or promise, whether written or oral, express or implied, or any Company sponsored severance plan (including the Senior Severance Plan) or program. Date of Termination You have previously agreed to your separation from service from the Company. Accordingly, your last day of work ("Last Day of Active Employment") will be January 9, 2004. Vacation Pay Unused 2003 vacation pay shall be paid out as a lump sum as soon as practicable after your Last Day of Active Employment. You are entitled to six (6) days of unused prior year vacation pay. Unused 2004 accrued vacation pay shall be paid out as a lump sum as soon as practicable after your Last Day of Active Employment. You are entitled to two and one-half (2.5) days of unused current year accrued vacation pay. Current year vacation pay ceases to accrue as of your Last Day of Active Employment. Severance Pay Provided you sign and return this Agreement and Release in the form provided to you, you shall receive eighteen (18) months of initial base salary continuation ("Initial Salary Continuation Period") and twelve (12) months of extended base salary continuation ("Extended Salary Continuation Period") following your Last Day of Active Employment. Your Initial Salary Continuation Period and Extended Salary Continuation Period are hereinafter collectively referred to as your "Salary Continuation Period". Your Salary Continuation Period shall extend from January 10, 2004 through July 9, 2006. The period commencing on the day following your -2- Last Day of Active Employment and ending on the last day of your Salary Continuation Period is referred to herein as the "Benefit Period". During your Salary Continuation Period, you shall be eligible for a short-term incentive compensation award in accordance with the terms of the Senior Severance Plan. The amount of such award for each calendar year that contains a portion of your Salary Continuation Period shall be as follows: 2004 Award (payable in March 2005) = $479,250 2005 Award (payable in March 2006) = $479,250 2006 Award (payable in March 2007) = $248,625 These salary continuation payments are hereinafter collectively referred to as "Severance Pay". The Company reserves the right in its sole discretion to continue your Severance Pay and/or certain benefits while you review this Agreement and Release, provided that this Severance Pay and benefits continuation shall in no event be construed as a waiver by the Company of the provision in the Senior Severance Plan making benefits contingent on execution of a release of claims in favor of the Company. Provided that you have signed and returned this Agreement and Release in the form provided, in the event of your death after your Last Day of Active Employment, payment of any remaining Severance Pay owing under this Agreement and Release will be made to your estate. All vacation and Severance Pay benefits are subject to federal, state and other applicable taxes and withholdings. Employee Benefits A general description of your rights to continued participation in your employee benefit plans is attached hereto as Exhibit A. Such description is for information purposes only and is not a part of this Agreement and Release. Additional Consideration In addition to the benefits to which you are entitled under the Senior Severance Plan, you shall be entitled to the following benefit(s) ("Additional Benefits"), provided you sign and return this Agreement and Release in the form provided to you: 1. Executive outplacement assistance is available to you for up to twelve (12) months, ending January 9, 2005. Executive outplacement assistance will be provided through Lee Hecht Harrison's personalized senior executive "Signature Service" and shall be coordinated through your Human Resources office. 2. The provision of Severance Pay during your Extended Salary Continuation Period. -3- 3. Forty-five thousand (45,000) unvested stock options from your February 7, 2003 option grant shall continue to vest as scheduled on January 1, 2005. You shall have three (3) years from your Last Day of Active Employment to exercise any options that vest under this paragraph. 4. Seventy-four thousand five hundred (74,500) unvested restricted units (twelve thousand (12,000) from your January 1, 2000 grant, twelve thousand five hundred (12,500) from your July 16, 2001 grant, and fifty thousand (50,000) from your February 7, 2002 grant) shall continue to vest as scheduled on January 28, 2005, July 16, 2004 and February 7, 2004, respectively. Dividends will be paid to you on these unvested restricted units. 5. You will become vested in the premium interest rate related to your Deferred Incentive and Deferred Salary accounts. Consideration for the Release The Severance Pay and Additional Benefits (the "Consideration") are something of value that will be available to you only in return for your signed Agreement and Release in the form provided to you. If you choose not to sign this Agreement and Release in the form provided to you, you will not be entitled to the Consideration. Contingencies In order to receive the Consideration under this Agreement and Release, you must return this signed Agreement and Release in the form provided to Thomas W. Weidenkopf at 101 Columbia Road, Morristown, New Jersey, no later than March 10, 2004. In the event that before the end of your Benefit Period you (i) accept a position with the Company as an employee, or (ii) return to work at Honeywell as a leased employee, consultant or independent contractor, all Consideration under this Agreement and Release will terminate as of the date your employment with the Company resumes. In such event, all Consideration paid to you before you are reinstated or rehired shall be considered to be valuable legal consideration to which you were not otherwise entitled and the Release of Claims and Confidentiality provisions of this Agreement and Release shall remain in effect and fully enforceable. Subject to the preceding paragraph, your acceptance of a position with another company will not affect your eligibility for the Consideration under this Agreement and Release. However, the Company reserves the right to cancel your Consideration (and to seek full reimbursement thereof) in the event that, at any time during the Salary Continuation Period, you engage in activities determined to be significantly detrimental to the Company's interests, including, without limitation, (i) recruiting, hiring or soliciting Honeywell employees for employment or the performance of services with a competing company, (ii) breach of any obligations under any confidentiality agreement or intellectual property agreement, (iii) making disparaging, knowingly false or misleading statements about the Company or its products, officers or -4- employees to competitors, customers, potential customers or to current or former employees of the Company, (iv) commission of any fraud or misappropriation of property, proprietary information, intellectual property or trade secrets of the Company for personal gain or for the benefit of another party, (v) engaging in intentional misconduct substantially damaging to the property or business of the Company, (vi) holding yourself out as an active Honeywell employee, and (vii) materially breaching any of the terms of this Agreement and Release. For at least six months after your Salary Continuation Period ends, your eligibility to return to work at Honeywell as a Honeywell employee, as a leased employee or as an independent contractor or consultant shall be subject to the Company's policies on contingent workers. Release Of Claims In exchange for the Consideration, you do hereby waive and do hereby release, knowingly and willingly, Honeywell International Inc., its future parent corporations, its predecessor companies, its past, present and future divisions, subsidiaries, affiliates and related companies and their successors and assigns and all past, present and future directors, officers, employees and agents of these entities, personally and as directors, officers, employees and agents (collectively the "Honeywell Group"), from any and all claims of any nature whatsoever you have arising out of your employment and/or the termination of your employment with the Honeywell Group, known or unknown, including but not limited to any claims you may have under federal, state or local employment, labor, or anti-discrimination laws, statutes and case law and specifically claims arising under the federal Age Discrimination in Employment Act, the Civil Rights Acts of 1866 and 1964, as amended, the Americans with Disabilities Act, Executive Order 11246, the Employee Retirement Income Security Act of 1974 ("ERISA"), the Family and Medical Leave Act, the Rehabilitation Act of 1973, the Fair Labor Standards Act, the Labor-Management Relations Act, the Equal Pay Act and the Worker Adjustment Retraining and Notification Act, the Minnesota Human Rights Act, the Minnesota Equal Pay Law, the Minnesota Age Discrimination Law, the Minnesota Smokers' Rights Law, the Minnesota Parental Leave Act, the Minnesota Constitution, Minnesota common law and any and all other applicable state, county or local statutes, ordinances or regulations, including claims for attorneys' fees; provided, however, that this release does not apply to claims for benefits under Honeywell Group sponsored benefit plans covered under ERISA (other than claims for severance and severance related benefits), does not apply to claims arising out of obligations expressly undertaken in this Agreement and Release, and does not apply to claims arising out of any act or omission occurring after the date you sign this Agreement and Release. All claims, including contingent claims, for incentive compensation awards under any Honeywell Group plan or payroll practice, along with any claims under any state wage and hour laws, are specifically subject to this release of claims. Any rights to benefits (other than severance benefits) under Honeywell Group sponsored benefit plans are governed exclusively by the written plan documents. You acknowledge and understand that you have accepted the Consideration referenced in this Agreement and Release in full satisfaction of all claims and obligations of the Honeywell Group to you regarding any matter or incident up to the date you execute this Agreement and Release (except to the extent expressly excepted from the terms of this Agreement and Release) and you affirmatively intend to be legally bound thereby. -5- You hereby agree and acknowledge that you are not entitled to receive any additional payments or benefits from the Honeywell Group related to your employment or termination of employment other than as expressly provided herein. Cooperation and Nondisclosure In further exchange for the Consideration you receive under this Agreement and Release, you agree to cooperate fully with the Company in any matters that have given or may give rise to a legal claim against the Company, and of which you are knowledgeable as a result of your employment with the Company. This requires you, without limitation, to (1) make yourself available upon reasonable request to provide information and assistance to the Company on such matters without additional compensation, except for your out of pocket costs, (2) maintain the confidentiality of all Company privileged or confidential information including, without limitation, attorney-client privileged communications and attorney work product, unless disclosure is expressly authorized by the Company's law department, and (3) notify the Company promptly of any requests to you for information related to any pending or potential legal claim or litigation involving the Company, reviewing any such request with a designated representative of the Company prior to disclosing any such information, and permitting a representative of the Company to be present during any communication of such information. In particular, and without limiting the applicability of the foregoing, you agree to make yourself reasonably available to assist (including, without limitation, making yourself available for interviews, depositions and trial) the Company in its defense of securities litigation currently pending in New Jersey Federal District Court under the caption In Re Honeywell Securities Litigation. Indemnification Honeywell will indemnify you, to the extent permitted by law and Honeywell's certificate of incorporation and by-laws, for personal acts and omissions committed in the exercise of your duties as an officer of the Company. Consistent with this obligation, the Company will advance indemnification expenses on your behalf, provided you sign an undertaking to repay all such amounts if it shall be ultimately determined by final judicial decision that you are not entitled to indemnification. Non-Competition Agreement In further exchange for the Consideration you receive under this Agreement and Release, you agree that for the entirety of your Salary Continuation Period you will not, without the written consent of Honeywell, directly or indirectly, (a) engage or be interested in (without any geographic restrictions or limitations), as owner, partner, shareholder, employee, director, officer, agent, consultant or otherwise, directly or indirectly, with or without compensation, any Competing Business or assist any Competing Business, (b) alone or in concert with others, employ or seek to employ, induce or solicit for employment, any person who was employed by the Company (other than persons employed in a clerical or other non-professional position) within the twelve (12) month period preceding the date of such employment or solicitation, or (c) -6- directly or through any third party, solicit, entice, persuade or induce any person or entity doing business with the Company, to terminate such relationship or to refrain from extending or renewing the same. For purposes of this Agreement, "Competing Business" shall mean each of the following entities and their subsidiaries and affiliates (including any successors thereto): (i) Siemens Building Technologies (a division of Siemens A.G.), (ii) Tyco Fire and Security (a division of Tyco International), (iii) GE Infrastructure (a division of General Electric Company), (iv) the HVAC and Process Control divisions of Emerson Electric Co., (v) Johnson Controls, Inc., (vi) Carrier (a division of United Technologies Corporation), (vii) Danaher Corporation, (viii) Trane (a division of American Standard Inc.), (ix) Yokogawa Corporation of America, (x) Invensys plc, (xii) Robert Bosch Corporation, and (xii) any business entity or group of business entities, regardless of whether organized as a corporation, partnership (general or limited), joint venture, association or other organization or entity ("Business Entity") with annual gross sales in excess of $1 billion, but only to the extent such Business Entity designs, develops, produces, offers for sale or sells products or services that compete with products and services offered for sale by Honeywell's Automation and Control Solutions business. Nothing herein, however, shall prohibit you from acquiring or holding not more than one percent (1%) of any class of publicly traded securities of any such business; provided that such securities entitle you to no more than one percent (1%) of the total outstanding votes entitled to be cast by security holders of such business in matters on which such security holders are entitled to vote. In the event any of the foregoing covenants shall be determined by any court of competent jurisdiction to be unenforceable by reason of extending for too great a period of time, over too great a geographical area or by reason of its being too extensive in any other respect, it shall be interpreted to extend only over the maximum period of time for which it may be enforceable, over the maximum geographical area as to which it may be enforceable, and/or to the maximum extent in all other respects as to which it may be enforceable, all as determined by such court in such action. The invalidity or unenforceability of any particular provision of this Non-Competition Agreement paragraph shall not affect the other provisions hereof, which shall continue in full force and effect. You agree that the Company's remedies at law would be inadequate in the event of a breach or threatened breach of this Non-Competition Agreement paragraph; accordingly, the Company shall be entitled, in addition to its rights at law, to seek an injunction or other equitable relief without the need to post a bond. The terms of this Non-Competition Agreement paragraph are to be read consistent with the terms of the Company's standard Agreement Relating to Intellectual Property and Confidential Information ("IP/Confidentiality Agreement"), a copy of which is attached hereto as Exhibit "B"; provided, however, to the extent the terms of this Non-Competition Agreement paragraph are more restrictive than such IP/Confidentiality Agreement, the terms of this Non-Competition Agreement paragraph shall govern. -7- Confidentiality Subject to the covenants in Exhibit B, you agree not to disclose or cause any other person to disclose to third parties, including employees of the Company, the terms of this Agreement and Release; provided, however, that you have the right to disclose the terms of this Agreement and Release to your spouse, your financial/tax advisor and your attorney and in response to a governmental inquiry, including a governmental tax audit or a judicial subpoena. You understand that your breach of this confidentiality provision shall excuse the Company from performing further under this Agreement and Release, and the Company shall be entitled to repayment of the Consideration provided hereunder upon demand. You agree that neither this Agreement and Release nor any version of this Agreement and Release shall be admissible in any forum as evidence against the Company or you except in a proceeding to enforce this Agreement and Release. This Agreement and Release does not constitute an admission of wrongdoing by either party. You acknowledge and agree that any agreements signed by you relating to intellectual property and confidential information acquired by you as a result of your employment with the Company remain in full force and effect and place legal obligations upon you that continue beyond your employment with the Company. In further exchange for the Consideration you receive under this Agreement and Release, you agree to abide by the confidentiality and intellectual property covenants set forth in Exhibit B attached hereto with respect to knowledge acquired during your employment with the Company. You hereby agree that the covenants appearing at Exhibit B are a material part of this Agreement and Release. Compliance With Sarbanes-Oxley Act Nothing in this Agreement and Release (or any exhibit or attachment thereto) shall be construed to prohibit you from reporting any accounting, internal accounting control, or auditing matter to any federal regulatory agency, any federal law enforcement agency, or any Member of Congress or any committee or subcommittee of Congress. Nor shall this Agreement and Release (or any exhibit or attachment thereto) be construed to prohibit you from engaging in any activity protected by 18 U.S.C. 'SS'1514A. Severability; Entire Agreement; No Oral Modifications; No Waivers Should any of the provisions of this Agreement and Release (other than the Release of Claims provision) be determined to be invalid by a court of competent jurisdiction, the parties agree that this shall not affect the enforceability of the other provisions of the Agreement and Release. In such case, the parties shall renegotiate the invalidated provision(s) in good faith to effectuate its/their purpose and to conform the provision(s) to applicable law. This Agreement and Release constitutes a single integrated contract expressing the entire agreement of the parties with respect to the subject matter hereof and supersedes all prior and contemporaneous oral and written agreements and discussions with respect to the subject matter hereof. This Agreement and Release may be amended or modified only by an agreement in writing. The failure by the Company to declare a breach or otherwise to assert its rights under this Agreement and Release -8- shall not be construed as a waiver of any right the Company has under this Agreement and Release. Acknowledgments And Certifications You acknowledge and certify that you: (a) have read and understand all of the terms of this Agreement and Release and do not rely on any representation or statement, written or oral, not set forth in this Agreement and Release; (b) have had a reasonable period of time to consider this Agreement and Release; (c) are signing this Agreement and Release knowingly and voluntarily; (d) have been advised to consult with an attorney before signing this Agreement and Release; (e) have the right to consider the terms of this Agreement and Release for 21 days and if you take fewer than 21 days to review this Agreement and Release, you hereby waive any and all rights to the balance of the 21 day review period; and (f) have the right to revoke this Agreement and Release within 15 days after signing it, by providing written notice of revocation to your Human Resources representative. If you revoke this Agreement and Release during this 15-day period, it becomes null and void in its entirety. THIS IS A LEGALLY ENFORCEABLE DOCUMENT. HONEYWELL INTERNATIONAL INC. By: -------------------------------------- ---------------------------------- J. KEVIN GILLIGAN THOMAS W. WEIDENKOPF Senior Vice President Human Resources And Communications Dated: Dated: ------------------------------- ------------------------------- -9- EXHIBIT A SUMMARY OF EMPLOYEE BENEFITS All capitalized terms in this description have the meaning set forth in the main body of the Agreement and Release, unless otherwise noted herein. This employee benefits description is applicable only with respect to eligible employees receiving periodic severance payments under the Senior Severance Plan, is for information purposes only and is not intended to constitute additional consideration for the execution of the Agreement and Release. Moreover, this description is not intended to supplant the applicable plan documents and summary plan descriptions. If you have specific questions regarding any employee benefit plan, please consult the applicable plan document and summary plan description. In the event of any conflict between this description and the actual employee benefit plan document, the employee benefit plan document shall control. The Company reserves the right, in its sole discretion, to amend, modify or terminate its employee benefit plans at any time and for any reason. Group Insurance Coverage As long as the underlying plan so allows, you may elect to retain your coverage in the Company's group health insurance plans for active employees through the end of the month in which your Benefit Period ends, except as otherwise provided below. The employee share of any premiums shall automatically be deducted from your Severance Pay unless you notify the Company, in writing, that you wish to cancel your insurance coverage. Notwithstanding any provision herein to the contrary, eligibility for short-term disability coverage, long-term disability coverage and any business travel insurance that you may have will terminate as of your Last Day of Active Employment. Your basic Company-sponsored life insurance coverage and accidental death and dismemberment coverage will end on the date your Salary Continuation Period ends. You may convert your basic Company-sponsored life insurance coverage and accidental death and dismemberment coverage to individual coverage by contacting Honeywell's HR Service Center at 1-877-258-3699, Option 4, to request the required conversion forms. You must apply for conversion of coverage on the approved forms within 31 days after your Salary Continuation Period ends. You may elect to retain any Group Universal Life Insurance (GUL) coverage you have through your Benefit Period. If you wish to continue your GUL insurance beyond the Benefit Period on a direct pay basis, you can contact CIGNA at 800-243-3264. -10- As noted above, your active Honeywell group health insurance coverage will expire at the end of the month in which your Benefit Period ends. At that time, you may elect to continue your group medical and dental insurance coverage pursuant to the federal COBRA law, assuming you have not allowed this coverage to expire during the Benefit Period. Honeywell's COBRA administrator will be contacting you at the end of your Benefit Period to provide you with further details and election forms. COBRA coverage is totally employee paid and is generally available at the rate of one hundred two percent (102%) of the applicable premium. Flexible Spending Accounts As long as the underlying plan so allows, you may elect to retain your coverage in the Company's Section 125 plan, including both health and dependent care flexible spending accounts, through the end of the month in which your Benefit Period ends. Any amounts you elect to contribute to a flexible spending account shall automatically be deducted from your vacation and Severance Pay. If, at the time you cease to be treated as an active employee for Section 125 plan purposes, you are eligible to continue coverage in your health flexible spending account pursuant to the federal COBRA law, you will be notified by the Company's COBRA administrator. Honeywell Savings Plan and Supplemental Savings Plan As long as the underlying plans so allow, you may continue to participate in the Company's savings plan and, if applicable, supplemental savings plan during your Benefit Period to the extent otherwise permissible under applicable law. Your current deductions will continue until the end of your Benefit Period unless you decide to change or terminate your contributions. At the end of your Benefit Period, you will receive information relating to the distribution of your Savings Plan account balance, if any. Your account, if any, in the Company's supplemental savings plan will be paid to you in accordance with your previous payment election(s). You have a non-forfeitable right to your Company matching contributions under the Company's savings plan and supplemental savings plan account, if applicable. Loan payments from the Company's savings plan, if any, will continue to be withheld during your Benefit Period. At the end of your Benefit Period you will have 90 days in which to repay any loan or it will default and be treated as taxable income, subject to regular taxes and an additional early withdrawal penalty (unless an exception to such early withdrawal penalty applies). Pension Plans You have a non-forfeitable right to your accrued pension benefits. Please consult your plan's Summary Plan Description if you have general questions regarding your pension plan. If you have specific questions or would like more detailed information regarding your pension benefits (including the estimated amount of your pension entitlement, the optional forms of benefit available to you, your vested status and when you can commence the receipt of such benefits), please contact the Retirement Pension Planning Department at 877-258-3699, option 5. -11- In addition, because your eligibility to participate in the Company's retiree medical programs is dependent, among other factors, on the pension plan in which you participate, information regarding your rights to retiree medical coverage can be provided by contacting the Retirement Pension Planning Department at 877-258-3699, option 5. Unemployment Insurance You may be eligible for unemployment benefits. You should contact your local unemployment office. Short-Term Incentive Compensation Plan For the portion of the current calendar year ending on your Last Day of Active Employment, you will not be considered for a short-term incentive bonus. Under the AlliedSignal Inc. Incentive Compensation Plan for Executive Employees ("ICP Plan"), you are not entitled to receive a short-term incentive bonus for the 2003 calendar year unless you are actively employed by the Company on the date short-term incentive bonuses are paid. Nevertheless, the Company may, in its sole discretion, consider you for a short-term incentive bonus based upon your performance and contributions as an active employee during the preceding calendar year, as well as the Company's performance for such year. The Company reserves sole discretion regarding the amount and payment, if any, of any bonus attributable to the 2003 calendar year. If the Company elects to award you a bonus with respect to the 2003 calendar year, it will be paid in accordance with the provisions of the ICP Plan, anticipated to be during the first quarter of the current calendar year. Any such bonus shall not include any period for which you have already received or will receive a short-term incentive compensation award. Stock Options You currently have 460,000 vested stock options. Subject to the Additional Consideration paragraph of the Agreement and Release, all of your other stock options will be forfeited. You may exercise your stock options in accordance with the following schedule:
----------------------------------------------------------- Grant Date Vested Options Grant Price Expiration Date ----------------------------------------------------------- 12/03/1999 150,000 $63.00 01/08/2007 ----------------------------------------------------------- 07/16/2001 250,000 $36.27 01/08/2007 ----------------------------------------------------------- 02/07/2003 60,000 $23.93 01/08/2007 ----------------------------------------------------------- ----------------------------------------------------------- 460,000 -----------------------------------------------------------
-------------------------------------------------------------- Grant Date Unvested Options Vesting Date Expiration Date -------------------------------------------------------------- 02/07/2003 45,000 01/01/2005 01/08/2007 --------------------------------------------------------------
-12- You may access your stock option account via the internet at www.benefitaccess.com, via the Honeywell intranet, or by contacting the Honeywell Stock Option Service Center at Salomon Smith Barney at 1-888-723-3391. Restricted Units Subject to the Additional Consideration paragraph of the Agreement and Release, all unvested restricted units will be forfeited. In accordance with the Additional Consideration paragraph of the Agreement and Release, certain unvested restricted units shall vest as follows:
--------------------------------------------- Grant Date Unvested RU's Vesting Schedule --------------------------------------------- 01/01/2000 12,000 01/28/2005 --------------------------------------------- 07/16/2001 12,500 07/16/2004 --------------------------------------------- 02/07/2002 50,000 02/07/2004 --------------------------------------------- --------------------------------------------- 74,500 ---------------------------------------------
Growth Units Any Growth Units issued pursuant to the 2003 Stock Incentive Plan of Honeywell International Inc. and its Affiliates that have not (i) vested, and (ii) been paid out as of your Last Day of Active Employment, will be forfeited. Deferred Incentive Compensation and Deferred Salary Your eligibility to participate in the Deferred Incentive and Deferred Salary programs will end on your Last Day of Active Employment. Any deferred incentive compensation and deferred salary account balances, plus interest at the "applicable interest rate" (determined pursuant to the applicable program and subject to the Additional Consideration paragraph of the Agreement and Release), will be paid in accordance with your applicable payment elections. Deferred Compensation from Honeywell Inc. Any Honeywell Inc. deferred compensation account balance you have will be paid per your previous payment elections. Executive Life Insurance You will be eligible to continue to participate in this program until the end of your Salary Continuation Period by making the required annual premium payments. The Executive Life Insurance Plan provides pre- and post-retirement life insurance for the beneficiaries or estates of former key executives of Honeywell Inc. This plan is called a "split dollar" plan because both you and the Company share premiums, cash value, and death benefits. By collateral assignment, you assigned to the Company an interest in the policy equal to its portion of the premiums paid. At "plan maturity," you will reimburse the Company for its -13- portion of the premium paid, and the Company will release the collateral assignment on the policy. Plan maturity occurs at age 60 or after approximately 15 years of participation, whichever is later. For questions or information, call David Soczek of Marsh Financial Services, at 1-612-332-5152, or contact Kenneth Bazemore at 1-973-455-3949. Executive Third Party Liability Insurance Coverage Your participation in the Company-sponsored third-party liability insurance coverage program will expire on your Last Day of Active Employment. Flexible Perquisite Program You will continue to be eligible for the Company's flexible perquisite program through the end of the calendar quarter commencing after your Last Day of Active Employment. Your last payment will be in April 2004. Executive Auto Insurance Your coverage under the Honeywell Executive Auto Insurance program will end as of your Last Day of Active Employment. -14- EXHIBIT B HONEYWELL INTERNATIONAL INC. Agreement Relating to Honeywell's Trade Secrets, Proprietary and Confidential Information In consideration of the receipt of my Severance Pay, I understand and agree that: 1. Records of Inventions. I have kept complete and current written records of all Inventions I Made during the period of time I was employed by Honeywell and promptly disclosed all such Inventions in writing to Honeywell for the purpose of adequately determining Honeywell's rights in each such Invention. I will supplement any such disclosures to the extent Honeywell may request that I do so. If I have any doubt as to whether or not to disclose an Invention to Honeywell, I will disclose it. 2. Disclosure of Inventions after Termination. I will promptly and completely disclose in writing to Honeywell's Law Department all Inventions that I Make during the one year immediately following the end of my employment by Honeywell which relate either to my work assignment at Honeywell or to Honeywell's Trade Secrets, Proprietary and Confidential Information for the purpose of determining Honeywell's rights in each such Invention. I will not file any patent application relating to any such Invention without the prior written consent of Honeywell's Law Department. If I do not prove that I Made the Invention entirely after leaving Honeywell's employment, the Invention is presumed to have been Made during the period of time I was employed by Honeywell. I acknowledge that the conditions of this paragraph are no greater than is necessary for protecting Honeywell's interests in Honeywell's Trade Secrets, Proprietary and Confidential Information and in Inventions to which it is rightfully entitled. 3. Ownership of Inventions. Each and every Invention I Made during the period of time I was employed by Honeywell (a) which relates directly to the business of Honeywell or to Honeywell's actual or demonstrably anticipated research or development, or (b) which resulted from any work I performed for Honeywell is the sole and exclusive property of Honeywell and I agree to assign and hereby assign my entire right, title and interest in each such Invention to Honeywell. Each Invention I Made during the period of time I was employed by Honeywell for which no equipment, supplies, facility or trade secret information of Honeywell was used and which was developed entirely on my own time is my property, unless (a) the Invention relates directly to the business of Honeywell or to Honeywell's actual or demonstrably anticipated research or development, or (b) the Invention results from any work performed by me for Honeywell. If I assert any property right in an Invention I Made during the period of time I was employed by Honeywell, I will promptly notify Honeywell's Law Department in writing. 4. Cooperation with Honeywell. I will assist and fully cooperate with Honeywell in obtaining, maintaining, and asserting the fullest measure of legal protection, which Honeywell elects to obtain, maintain or assert for Inventions in which it has a property right. I will also assist and fully cooperate with Honeywell in defending Honeywell against claims of violation of -15- the intellectual property rights of others. I will be paid my reasonable expenses in assisting, and cooperating with, Honeywell. I will execute any lawful document Honeywell requests me to execute relating to obtaining, maintaining or asserting legal protection for any said Invention or in defending against claims of the violation of the intellectual property rights of others (including, but not limited to, executing applications, assignments, oaths, declarations, and affidavits) and I will make myself available for interviews, depositions and testimony. In the event that Honeywell is unable, after reasonable effort, to secure my signature on any document or documents needed to apply for or prosecute any patent, copyright, or other right or protection relating to an Invention, for any other reason whatsoever, I hereby irrevocably designate and appoint Honeywell and its duly authorized officers and agents as my agent and attorney-in-fact, to act for and on my behalf to execute and file any such application or applications, and to do all other lawfully permitted acts to further the prosecution and issuance of patents, copyrights, or similar protections thereon with the same legal force and effect as if executed by me. 5. Preemployment Inventions. On Schedule A, which is an integral part of this Exhibit A, I have completely identified (without disclosing any trade secret, proprietary or other confidential information) every Invention I Made before my employment by Honeywell in which I have any ownership interest and which is not now the subject master of an issued patent or a printed publication. If I become aware of any projected or actual use of any such Invention by Honeywell, I will promptly notify Honeywell in writing of said use. Except as to the Inventions listed on Schedule A or those which are now the subject matter of an issued patent or a printed publication, I will not assert any rights against Honeywell with respect to any Invention Made before my employment by Honeywell. 6. Honeywell's Trade Secrets, Proprietary and Confidential Information. I will never, directly or indirectly, use Honeywell's Trade Secrets, Proprietary and Confidential Information (as hereinafter defined) except in furthering Honeywell's business nor will I disclose or disseminate Honeywell's Trade Secrets, Proprietary and Confidential Information to anyone who is not an officer, director, employee, attorney or authorized agent of Honeywell without the prior written consent of Honeywell's Law Department unless the specific item of Honeywell's Trade Secrets, Proprietary and Confidential Information: (a) is now in, or hereafter becomes (through no breach of these covenants) general public knowledge, or (b) prior to my disclosure, dissemination or use, was lawfully acquired by me without any obligation to retain the information in confidence. In this connection, I will not publish any of Honeywell's Trade Secrets, Proprietary and Confidential Information for dissemination outside Honeywell or file any patent application relating to any Invention I Make during the period of time I was employed by Honeywell without the prior written approval of Honeywell's Law Department. I will execute any agreement relating to the protection of Honeywell's Trade Secrets, Proprietary and Confidential Information or such information of any third party whose intellectual property Honeywell is under a legal obligation to protect if Honeywell requests that I do so. I will not engage without the prior written consent of Honeywell's Law Department, either during the period of time I was employed by Honeywell or for a period of two years after that employment, in any activity or employment in the faithful performance of which it could be reasonably anticipated that I would use or disclose Honeywell's Trade Secrets, Proprietary and Confidential Information. All documents and tangible things embodying or containing Honeywell's Trade Secrets, Proprietary and Confidential Information are Honeywell's exclusive property. I had -16- access to them solely for the performance of my duties during my employment with Honeywell. I will protect the confidentiality of their content and comply with all security policies and procedures that may, from time to time, have been established by Honeywell. I have returned all of them, along with all copies, facsimiles and specimens of them and any other tangible forms of Honeywell's Trade Secrets, Proprietary and Confidential Information in my possession, custody or control to Honeywell before leaving the employment of Honeywell. I understand that I have the right to use or practice any skill or expertise generally associated with my employment but not special or unique to Honeywell, but that I do not have the right to use, practice or disclose Honeywell's Trade Secrets, Proprietary and Confidential Information for my own benefit or for the benefit of any third party. 7. Trade Secrets, Proprietary or Confidential Information from Previous Employment. I certify that I have not disclosed or used, during my employment by Honeywell, any trade secrets, proprietary or confidential information that I acquired as a result of any previous employment or under a contractual obligation of confidentiality before my employment by Honeywell. I understand that Honeywell has no interest in, and will not accept disclosure by me of, any confidential information that belongs to a third party. 8. Non-Solicitation of Honeywell Employees. I acknowledge that Honeywell has invested significant time and money to recruit and retain its employees. Therefore, recognizing that in the course of my employment I have obtained valuable information about Honeywell employees, their respective talents and areas of expertise, I agree that for a period of one (1) year following my termination of employment from Honeywell for any reason, I will not, directly or indirectly, (i) cause any individual previously employed by Honeywell to be employed by any person or entity other than Honeywell unless such individual has not been employed by Honeywell for at least 12 months, (ii) participate in any manner in the employment of any such individual by any person or entity other than Honeywell unless such individual has not been employed by Honeywell for at least 12 months, or (iii) in any way induce or attempt to induce such individual to leave the employment of Honeywell. 9. Non-Solicitation of Honeywell Customers. I acknowledge that Honeywell has invested significant time and money to develop valuable, continuing relationships with existing and prospective clients and customers. Therefore, recognizing that in the course of my employment I have obtained valuable information about Honeywell customers and their requirements, I agree that, for a period of two years following my termination of employment from Honeywell for any reason, I will not solicit or attempt to solicit, directly or indirectly, for my own account or for others, any existing clients or customers of Honeywell with whom I had contact or of whom I became aware while employed by Honeywell during the two year period prior to my termination, or any prospective clients or customers of Honeywell with whom I had contact and with whom Honeywell took significant steps to do business during the two year period prior to my termination, for the purpose of inducing such clients or customers to cease doing business with Honeywell or to purchase, lease or utilize products or services which are competitive with, are similar to, or which may be used as substitutes for any products or services offered by Honeywell. -17- 10. Notice to Future Employers. For the period of two years immediately following the end of my employment by Honeywell, I will inform each new employer, prior to accepting employment, of the existence of this Exhibit A and provide that employer with a copy of it. Honeywell has the right to inform any future employer of the existence of this Exhibit A and to provide any future employers with a copy of it. 11. Copyright. As to all works prepared by me which were: (i) within the scope of my employment; or (ii) based upon information I acquired from Honeywell which is not normally made available to the public; or (iii) commissioned by Honeywell, but not within my scope of employment, I hereby agree to: (a) submit to Honeywell's Law Department for approval prior to publication or oral dissemination; (b) assign all right, title and interest in and to the copyright in all such works to Honeywell; and (c) waive any claim of moral rights, author's rights, droit moral, or any equivalent rights to the extent necessary or permitted by law. I hereby release and allow Honeywell to use, for any lawful purpose, any voice reproduction, photograph, or other video likeness of me made in the course of my employment. 12. Identity of Future Employer. Upon termination of employment, whether termination be voluntary or involuntary, if reasonably requested by Honeywell, I shall advise Honeywell of the name and address of my intended future employer. 13. Successors; Binding Agreement. This Exhibit A binds my heirs, executors, administrators, legal representatives and assigns and inures to the benefit of Honeywell and its successors and assigns. Only a written amendment executed by both Honeywell and myself can modify this Exhibit A. 14. Survival of Covenants. These obligations will continue after, and survive, the end of my employment by Honeywell. 15. Remedies. I acknowledge that a remedy at law for any breach or threatened breach of the provisions of this Exhibit A would be inadequate and therefore agree that Honeywell shall be entitled to injunctive relief in addition to any other available rights and remedies in case of any such breach or threatened breach. In the event a court determines that I have breached or threatened to breach the covenants in this Exhibit A, I agree to reimburse Honeywell for all attorneys' fees and costs incurred in enforcing the terms hereof. Nothing contained herein shall be construed as prohibiting Honeywell from pursuing any other remedies available for any such breach or threatened breach against me or my then-current employer which may include, but shall not be limited to, contract damages, lost profits and punitive damages. -18- 16. Validity. It is the desire and intent of the parties hereto that the provisions of this Exhibit A shall be enforced to the fullest extent permissible. Accordingly, if any particular provision of this Exhibit A shall be adjudicated to be invalid or unenforceable, the court may modify or sever such provision, with such modification or deletion to apply only with respect to the operation of such provision in the particular jurisdiction in which such adjudication is made. In addition, if any one or more of the provisions contained in this Exhibit A shall for any reason be held to be excessively broad as to duration, geographical scope, activity or subject, it shall be construed by limiting and reducing it, so as to be enforceable to the extent compatible with the applicable law as it shall then appear. The remaining provisions of this Exhibit A shall remain in full force and effect. 17. Governing Law. The terms of this Exhibit A shall be governed by and construed in accordance with the laws of the State of New Jersey without regard to principles of conflicts of law. 18. Descriptive Headings. The headings and captions in this Exhibit A are inserted for convenience only and shall not in any way affect the meaning or construction of its terms. 19. Definitions (a) "Honeywell" collectively identifies Honeywell International Inc. (a Delaware corporation having a place of business at Columbia Road and Park Avenue, Morris Township, Morris County, New Jersey), its predecessors, successors and its past, present and future operating companies, divisions, subsidiaries, affiliates and business units, including businesses acquired by the purchase of assets or stock, merger or otherwise. (b) "Trade Secrets, Proprietary and Confidential Information" means information which is not generally known in the industries in which Honeywell is engaged, which may be disclosed to me or which I may learn, observe, discover or otherwise acquire during, or as a result of, my employment by Honeywell, and which includes, without limitation, any information, whether patentable, patented or not, relating to any existing or contemplated products, inventions, services, technology, concepts, designs, patterns, processes, compounds, formulae, programs, devices, tools, compilations of information, methods, techniques, and including information relating to any research, development, manufacture, purchasing, engineering, know-how, business plans, sales or market methods, methods of doing business, customer lists, customer usages or requirements, or supplier information, which is owned or licensed by Honeywell or held by Honeywell in confidence. (c) "Invention" includes not only inventions (whether or not patentable), but also innovations, improvements, discoveries, ideas and all other forms of intellectual property (including, but not limited to, copyright works and mask works), whether or not any of the foregoing constitutes trade secret or other confidential information. -19- d) "Make" or "Made", when used in relation to Inventions, includes any one or any combination of (i) conception, (ii) reduction to practice or (iii) development of an Invention, and is applicable without regard to whether the individual is a sole or joint inventor. -20- SCHEDULE A INVENTIONS I MADE BEFORE THE TERM OF MY EMPLOYMENT BY HONEYWELL IN WHICH I HAVE AN OWNERSHIP INTEREST WHICH ARE NOT THE SUBJECT MATTER OF ISSUED PATENTS OR PRINTED PUBLICATIONS: (If there are none, please enter the word "NONE") NOTE: Please describe each such Invention without disclosing confidential information. ________________________________________________________________________________ ________________________________________________________________________________ ________________________________________________________________________________ ________________________________________________________________________________ ________________________________________________________________________________ ________________________________________________________________________________ ________________________________________________________________________________ ________________________________________________________________________________ _______________________________________ [Attach additional sheets if more space is needed.]