The Performance Stock Program places a portion of top executives’ long-term compensation at risk. The program measures performance over a three-year period based on the Company’s total shareholder return relative to those companies within the Standard & Poor’s 500 Composite Price Index. A description of the program, as well as the threshold, target and maximum awards for the named executive officers appears on page 24. Based on the Company’s performance over the three-year performance cycle ending in 2000, no awards were paid for this cycle.

From time to time, the Company grants restricted stock awards to selected executives. These awards are generally made to either (1) induce the recipients to remain with or to become employed by the Company; or (2) recognize exceptional performance.

Share Ownership Program

The interests of the Company’s executives must be consistent with those of its shareholders. The Company aims to link these interests by encouraging stock ownership on the part of its executives.

One program designed to meet this objective is the Company’s share ownership program. Under this program, each senior executive is required to own stock of the Company worth a multiple of his or her base salary. These multiples range from one times base salary to four times base salary for the CEO. Today, the program applies to approximately 24 senior executives, all of whom have either satisfied or are on track to satisfy the requirements.