Chief Executive Officer Compensation

Mr. Carp was named Chief Executive Officer on January 1, 2000. Coincident with this promotion, the Company entered into an agreement with Mr. Carp concerning his compensation. The terms of this agreement are described on page 25. Below is a description of Mr. Carp’s compensation for 2000.

Base Salary: Mr. Carp received a base salary of $1,000,000 as required under his agreement with the Company.

Short-Term Bonus: The Committee used the results of the management appraisal process to determine the CEO’s short-term bonus for 2000. Mr. Carp’s award is listed in the Summary Compensation Table on page 20. Based primarily on the Company’s inability to achieve its financial goals, the Committee awarded Mr. Carp a short-term bonus well below his target award.

Stock Options: In March of 2000, the Committee awarded Mr. Carp his target award of 100,000 shares under the Company’s management stock option program.

Performance Stock Program: Based on the Company’s financial performance over the three-year period ending in 2000, Mr. Carp did not receive an award for the 1998-2000 performance cycle.

Election as Chairman: On December 7, 2000, the Board elected Mr. Carp its Chairman. As a result of this promotion, the Committee reviewed Mr. Carp’s compensation. The Committee did not adjust Mr. Carp’s base salary of $1,000,000. The Committee did, however, increase Mr. Carp’s target award under the short-term bonus plan from 105% to 145% of base salary and under the management stock option program from 100,000 to 140,000 shares. To recognize Mr. Carp’s promotion, the Committee granted him, effective January 12, 2001, a stock option award of 160,000 shares and an award of 20,000 shares of restricted stock.