31 December 2002
Honeywell ponies up cash for employees
Morris Township, N.J. - Honeywell said yesterday that it has contributed $700 million in stock to its U.S. defined benefit pension plans.
The company has contributed $800 million in cash and stock to its pension plans in 2002 to improve the funded status of those plans.
Honeywell recently notified the Securities and Exchange Commission that its employee pension plans would end 2002 with a $1.7 billion deficit without new funds.
Many pension plans that have defined benefits to be paid to retirees have developed deficits in recent years as the value of equities has fallen.
Federal law requires companies to protect the solvency of pension plans, which prompted many companies to increase funding to cover future retiree benefits.
Honeywell has appointed U.S. Trust Company, N.A. as an independent fiduciary to make all investment decisions with respect to the contributed shares.
Honeywell, a member of the InTech Select 25 stock index, said last week that it would post an increase in pension expenses of 30 cents to 40 cents per share next year, 2003.
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