ITEM 3
Amendment to 2000 Management Variable Compensation Plan

What am I voting on?
You are voting on an amendment to 2000 Management Variable Compensation Plan to add additional performance measures that the Executive Compensation and Development Committee may select in establishing performance goals. The Board approved this amendment subject to your approval. The amendment appears as Exhibit I on page 34.

What is the 2000 Management Variable Compensation Plan?
The 2000 Management Variable Compensation Plan is our short-term annual bonus plan for executives. The purpose of the Plan is to provide a performanced-based, annual incentive award to attract, retain and motivate our management-level employees and to appropriately recognize their performance. You previously approved this plan on May 12, 1999. The Plan currently has only one performance measure, Economic Profit/Economic Value Added.

Why is the Plan being amended?
The Plan is being amended in anticipation of the results of a review of our executive compensation program. Periodically we undertake a study of our executive compensation program to determine whether it is fulfilling its stated principles and objectives. At the request of the Executive Compensation and Development Committee, such a study is presently underway. We anticipate completing this study by yearend.

The amendment will provide the Committee the flexibility to select an appropriate performance measure at the end of the study and introduce it in the 2002 performance period.

Why are we requesting your approval?
You are being asked to approve this amendment to allow all compensation paid under the amended plan to continue to be deductible by the Company. Under Section 162(m) of the Internal Revenue Code, a company is generally not permitted to deduct compensation paid in excess of $1 million to its Chief Executive Officer or its four other most highly compensated executive officers, unless the compensation is paid under a performanced-based compensation plan. To satisfy the requirements that apply to performanced-based compensation plans, any performance measure used by the Plan must be approved by our shareholders.