Salary Deferral Plan for Selected Employees of AlliedSignal Inc. and its
Affiliates (Career Band 6 and above or employees who occupy positions equivalent
thereto)
Effective
1/1/94
1. ELIGIBILITY
Those employees of AlliedSignal Inc. (the 'Corporation') and its affiliates
whose positions are evaluated in Career Band 6 and above or who occupy positions
equivalent thereto and who are designated by the Management Development and
Compensation Committee (the 'Committee'), shall be eligible to participate in
this supplemental non-qualified Salary Deferral Plan for Selected Employees of
AlliedSignal Inc. and its Affiliates (Career Band 6 and above or employees who
occupy positions equivalent thereto) (the 'Plan').
2. PARTICIPATION
An eligible employee may become a participant in the Plan (a 'Participant')
by filing a timely written deferral election with the Corporation. Such notice
shall direct that a portion of the compensation elements described in paragraph
3(a) and paragraph 3(b) be credited to an unfunded deferred compensation account
maintained for the Participant under the Plan (the 'Participant Account' or
'Account'). A Participant's direction shall become effective for the next
succeeding pay period or payment date, as appropriate, and shall continue in
effect until the employee terminates such direction or is no longer eligible to
be a Participant. Any modification of a Participant's direction shall be
effective only with respect to compensation payable with respect to pay periods
which begin after the date such direction is received by the Corporation or
payment dates which occur later in time, and amounts previously credited to the
Participant's Account shall not be affected.
3. CONTRIBUTIONS TO PARTICIPANT ACCOUNTS
(a) Base Annual Salary -- A Participant may, prior to the commencement of
any pay period, elect to defer an aggregate amount of base annual salary,
exclusive of any bonus or any other compensation or allowance paid or payable
by the Corporation or its affiliates (the 'Base Annual Salary'). The amount
deferred under this paragraph 3(a) shall not be greater than fifty percent
(50%) of the Participant's Base Annual Salary for such pay period.
(b) Incentive Awards -- A Participant may, to the extent that the
AlliedSignal Inc. Incentive Compensation Plan For
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Executive Employees (the 'Incentive Plan') permits deferrals of an incentive
award (the 'Incentive Award') payable thereunder, elect to defer an amount
not greater than one hundred percent of such Incentive Award. Any amount so
deferred shall be deemed to be deferred under this Plan but shall, to the
extent the provisions of the Incentive Plan are not inconsistent with this Plan,
otherwise be subject to the terms of the Incentive Plan. Any deferral of an
Incentive Award shall be made by filing an appropriate written deferral election
with the Corporation not later than ninety days prior to the end of the
performance period with respect to which the Incentive Award is payable.
(c) Deferral Amounts -- All amounts determined under this paragraph 3 which
are the subject of a written deferral election (the 'Deferral Amounts') shall,
in accordance with the relevant Participant direction, be credited to a
Participant Account maintained under the Plan on the same day the Base Annual
Salary or Incentive Award would otherwise have been payable.
4. DEFERRAL REQUIREMENTS
Amounts may be deferred under this Plan for a minimum period of three
years. No amount shall be withdrawn from a Participant Account prior to the
earlier of: three years following the last day of the calendar year in which the
amount is credited to the Participant Account; the date the Participant reaches
normal retirement age and is eligible to receive a benefit under a pension plan
of the Corporation or one of its affiliates; the date of Participant's death; or
the date the Participant ceases to be employed by the Corporation or any of its
affiliates.
5. INTEREST EQUIVALENTS
Deferral Amounts shall accrue additional amounts equivalent to interest
('Interest Equivalents'), compounded daily, from the date the Deferral Amount is
credited to the Account to the date of distribution. A single rate for
calculating Interest Equivalents shall be established by the Committee, in
its sole discretion, for all Deferral Amounts credited to Participant Accounts
in each calendar year. The rate established by the Committee 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. Such Interest Equivalents, once established for a
calendar year,
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shall remain in effect with respect to Deferral Amounts credited to Participant
Accounts during that calendar year until the Deferral Amounts are distributed.
6. PARTICIPANT ACCOUNTS
All amounts credited to a Participant's Account pursuant to paragraphs 3
and 4 shall be unfunded general obligations of the Corporation, and no
Participant shall have any claim to or security interest in any asset of the
Corporation on account thereof.
7. DISTRIBUTION FROM ACCOUNTS
At the time a Participant makes an election pursuant to paragraph 3, the
Participant shall also make an election with respect to the distribution of the
Deferral Amounts and Interest Equivalents accrued thereon which are credited to
the Participant's Account pursuant to such election. A Participant may elect to
receive such distribution in one lump-sum payment or in a number of
approximately equal annual payments (provided the payment period may not include
more than fifteen such installments). The lump-sum or the first installment
shall be paid as soon as practicable during the month of January of the calendar
year designated by the Participant. Except as otherwise provided in paragraphs 8
and 9, all installment payments following the initial installment payment shall
be paid in cash as soon as practicable during the month of January of each
succeeding calendar year until the entire amount in the Account shall have been
paid.
8. DISTRIBUTION ON DEATH
If a Participant should die before all amounts credited to the
Participant's Account have been distributed, the balance in the Account shall be
paid as soon as practical thereafter to the beneficiary designated in writing by
the Participant. Payments to a beneficiary pursuant to a designation by a
Participant shall be in such form as the Participant shall elect, including
periodic payments as described in paragraph 7, but in the absence of any such
election, the payment shall be made in one lump sum to the designated
beneficiary as soon as practicable following the death of the Participant. Such
beneficiary designations shall be effective when received by the Corporation,
and shall remain in effect until rescinded or
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modified by the Participant by an appropriate written direction. If no
beneficiary is properly designated by the Participant or if the designated
beneficiary shall have predeceased the Participant, such balance in the
Account shall be paid to the estate of the Participant.
9. CHANGE IN CONTROL
(a) Initial Lump Sum Election -- Notwithstanding any election made pursuant
to paragraph 7, a Participant may file a written election with the Corporation
to have the Deferral Amounts and Interest Equivalents accrued thereon which are
credited thereafter to the Participant's Account paid in one lump-sum payment as
soon as practicable following a Change in Control, but in no event later than 90
days after such Change in Control.
(b) Revocation of Lump-Sum Election -- A Participant may revoke an
election made pursuant to paragraph 9(a) by filing an appropriate written notice
with the Corporation. A revocation notice filed pursuant to this paragraph 9(b)
shall be effective with respect to Deferral Amounts and Interest Equivalents
accrued thereon which are credited thereafter to the Participant's Account.
(c) Limitation on Elections -- Any election made pursuant to paragraphs
9(a) or 9(b) shall not be effective unless filed with the Corporation at least
90 days prior to a Change in Control.
(d) Definition of Change in Control -- For purposes of the Plan, a Change
in Control is deemed to occur at the time (i) when any entity, person or group
(other than the Corporation, any subsidiary or savings, pension or other benefit
plan for the benefit of employees of the Corporation or its subsidiaries) which
theretofore beneficially owned less than 30% of the Corporation's common stock
(the 'Common Stock') then outstanding, acquires shares of Common Stock in a
transaction or a series of transactions that results in such entity, person or
group directly or indirectly owning beneficially 30% or more of the outstanding
Common Stock, (ii) of the purchase of Common Stock pursuant to a tender offer or
exchange offer (other than an offer by the Corporation) for all, or any part of,
the Common Stock ('Offer'), (iii) of a merger in which the Corporation will not
survive as an independent, publicly owned corporation, a consolidation, a sale,
exchange or other disposition of all or substantially all of the Corporation's
assets, (iv) of a substantial change
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in the composition of the Board during any period of two consecutive years such
that individuals who at the beginning of such period were members of the Board
cease for any reason to constitute at least a majority thereof, unless the
election, or the nomination for election by the shareowners of the Corporation,
of each new director was approved by a vote of at least two-thirds of the
directors then still in office who were directors at the beginning of the
period, or (v) of any transaction or other event which the Committee, in its
sole discretion, determines to be a Change in Control for purposes of the Plan.
10. MISCELLANEOUS
(a) No Alienation of Benefits -- Except insofar as may otherwise be
required by law, no amount payable at any time under the Plan shall be subject
in any manner to alienation by anticipation, sale, transfer, assignment,
bankruptcy, pledge, attachment, charge, or encumbrance of any kind nor in any
manner be subject to the debts or liabilities of any person and any attempt to
so alienate or subject any such amount, whether presently or thereafter payable,
shall be void. If any person shall attempt to, or shall alienate, sell,
transfer, assign, pledge, attach, charge, or otherwise encumber any amount
payable under the Plan, or any part thereof, or if by reason of such person's
bankruptcy or other event happening at any such time such amount would be made
subject to the person's debts or liabilities or would otherwise not be enjoyed
by that person, then the Corporation, if it so elects, may direct that such
amount be withheld and that same or any part thereof be paid or applied to
or for the benefit of such person, the person's spouse, children or other
dependents, or any of them, in such manner and proportion as the Corporation
may deem proper.
(b) No Right or Interest in Corporation's Assets -- Neither the Corporation
nor any of its Affiliates shall be required to reserve or otherwise set aside
funds for the payment of obligations arising under this Plan. The Corporation
may, in its sole discretion, establish funds, segregate assets or take such
other action as it shall determine necessary or appropriate to secure the
payment of its obligations arising under this Plan. Nothing contained herein,
and no action taken pursuant to the provisions of this Plan shall create or be
construed to create a trust of any kind, or a fiduciary relationship between the
Corporation and any Participant or any other person. To the extent that any
person acquires a right to receive
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payments under this Plan, such right shall be no greater than the right of an
unsecured creditor of the Corporation.
(c) Administration -- The Corporation shall have sole discretion and
authority to administer the Plan, including the authority to interpret its
terms, promulgate regulations thereunder, determine eligibility to participate
in the Plan and make any finding of fact which may be necessary to determine
the obligation of the Plan with respect to the payment of benefits.
(d) Amendment -- The Corporation may amend, modify or terminate the Plan at
any time, or from time to time; provided, however, that no change to the Plan
shall impair the right of any Participant with respect to amounts then credited
to an Account.
(e) Accounting -- Each Participant shall receive periodic statements (not
less frequently than annually) setting forth the cumulative Deferral Amounts and
Interest Equivalents credited to, and any distributions from, the Participant's
Account.
(f) Facility of Payments -- If the Corporation shall find that any person
to whom any amount is payable under the Plan is unable to care for his or her
affairs because of illness or accident, or is a minor, or has died, then any
payment due the person or the person's estate (unless a prior claim therefor has
been made by a duly appointed legal representative), may, if the Corporation so
elects in its sole discretion, be paid to the person's spouse, a child, a
relative, an institution having custody of such person, or any other person
deemed by the Corporation to be a proper recipient on behalf of such
person otherwise entitled to payment. Any such payment shall be a complete
discharge of the liability of the Corporation and the Plan therefor.
(g) Governing Law -- The Plan is intended to constitute an unfunded
deferred compensation arrangement for a select group of management or highly
compensated personnel and all rights thereunder shall be governed by and
construed in accordance with the laws of New York.
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Salary Deferral Plan for Selected Employees - AlliedSignal Inc.
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