RNS Number:1334G
Honeywell International Inc (IRS)
29 June 2001

CONTACT:  TOM CRANE
          (973) 455-4732

                Honeywell CEO Bonsignore Sends Letter To GE's Welch
           Proposing Solutions Designed To Satisfy Concerns Of Both GE And
                                  European Commission

                    Honeywell Also Offers To Amend Exchange Ratio
                               Of Their Pending Merger
      
        MORRIS TOWNSHIP, New Jersey, June 29, 2001 -- Honeywell (NYSE: HON)
said today that its Chairman and CEO Michael R. Bonsignore has sent a letter to
General Electric's (NYSE: GE) Chairman and CEO Jack Welch proposing solutions
designed to satisfy concerns of both GE and the European Commission regarding
the companies' pending merger.

The company also has offered to amend the exchange ratio of the transaction if
GE submits undertakings that Honeywell believes will be sufficient to satisfy
the European Commission's concerns.  If GE accepts the offer, the revised merger
agreement will require Honeywell shareowner approval.

The full text of the letter is provided below


Based on our conversation yesterday with Commissioner Monti and other recent
public statements by both Commissioner Monti and the Commission's spokesperson,
it is clear to me what is required to secure Commission approval of the
Honeywell/GE merger. Consistent with our obligations under the Merger Agreement,
we owe it to each other and to our respective shareholders and other
constituencies to make a last-minute best effort to ensure approval and
consummation of this important transaction.

I am writing to request that GE and Honeywell jointly submit revised
undertakings that include: (i) the undertakings formally submitted to the
Commission on June 14, 2001, modified to meet the Commission's technical
concerns and (ii) a commitment to effect a private placement of 19.9% of the
common equity of GECAS on terms that I believe satisfy the governance concerns
raised by Commissioner Monti yesterday.

Our attorneys are forwarding to your attorneys this morning a formal set of
undertakings ready for submission to the Commission.

I know that Commissioner Monti has stated that, if the parties divested 19.9% of
GECAS, the divestitures proposed on June 14, 2001 were sufficient to satisfy the
Commission's concerns and, indeed, that lesser divestitures could have been
sufficient. We both had been hoping, based on those statements, that the
Commission would accept fewer divestitures if GE offered to divest a minority
position in GECAS. We submitted divestitures totaling $1.1 billion of revenues,
along with a GECAS remedy.

The Commissioner told us yesterday, however, that the limited time available to
him was not sufficient to consider adequately the new divestiture package.
Unfortunately, the delay in offering the GECAS solution until June 28th has
limited the Commission's ability to undertake its necessary review and,
therefore, a more complete alternative is the only possible effective solution
that will satisfy the Commission. Accordingly, in addition to the strengthened
partial divestiture of GECAS, I see no choice now but to return to the $2.2
billion of divestitures in the June 14 offering, which both of us submitted to
the Commission. I note that the GECAS proposal now provides for Commission
approval of the minority shareholder and Independent Director and more clearly
gives the Independent Director the incentive and power to prevent GECAS from
improperly discriminating in favor of Honeywell products. These changes
specifically address the concerns expressed by Commissioner Monti yesterday.

I understand that GE would prefer not to give up any more value than required by
the June 14 undertakings. Accordingly, I have been authorized by the Honeywell
Board of Directors to offer, and Honeywell hereby offers, to reduce the exchange
ratio provided in the Merger Agreement from 1.055 shares of GE for every
Honeywell share to 1.01 shares of GE for every Honeywell share. In our view,
this exchange rate reduction would compensate GE for any loss of value as a
result of the divestiture of 19.9% of GECAS. The revision of the Merger
Agreement to reduce the exchange ratio would require, of course,
Honeywell shareholder approval. We would seek such approval immediately if you
agree to the revision.

In light of our mutual desire to have the merger accounted for as a pooling of
interests and the pending termination of pooling under applicable accounting
standards, we must move quickly. Indeed, we must amend the Merger Agreement and
announce any change in the exchange ratio no later than Saturday. In addition,
in order to obtain Commission approval of the transaction we must submit revised
undertakings preferably today, but, in no event, later than 9:00 a.m. Monday
morning Brussels time. In light of these deadlines, the need to act
expeditiously is absolutely clear.

In sum, I am writing to request that GE submit promptly the revised undertakings
that will be delivered to your attorneys this morning. I believe that our
agreement to proceed as I suggest is in the interests of both of our companies
and their shareholders and, indeed, is required by our mutual obligation under
the Merger Agreement to use all reasonable best efforts to secure regulatory
approval of the merger. We and our advisors stand ready to work with you and
your advisors.

As you know, time is of the essence. I look forward to hearing from you.

Sincerely, Michael R. Bonsignore


"Honeywell's proposal satisfies all of the competition concerns and serves the
best interests of all stakeholders," Michael Bonsignore said. "It provides GE
with better economics for the deal, and it satisfies the European Commission's
divestiture requirements."

Honeywell is a US$25-billion diversified technology and manufacturing leader,
serving customers worldwide with aerospace products and services; control
technologies for buildings, homes and industry; automotive products; power
generation systems; specialty chemicals; fibers; plastics; and electronic and
advanced materials. The company is a leading provider of software and solutions
and Internet e-hubs including MyPlant.com and MyFacilities.com, and it is a
founding member of Cordiem, LLC, an aerospace industry business-to-business
Internet exchange and applications service provider. Honeywell employs
approximately 125,000 people in 95 countries and is traded on the New York Stock
Exchange under the symbol HON, as well as on the London, Chicago and Pacific
stock exchanges. It is one of the 30 stocks that make up the Dow Jones
Industrial Average and is also a component of the Standard & Poor's 500 Index.
Additional information on the company is available on the Internet at
www.honeywell.com.

This release contains forward-looking statements as defined in Section 21E of
the Securities Exchange Act of 1934, including statements about future business
operations, financial performance and market conditions. Such forward-looking
statements involve risks and uncertainties inherent in business forecasts as
further described in our filings under the Securities Exchange Act.
        
6/29/01
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