[CORPORATE LOGO HERE]
NIAGARA MOHAWK HOLDINGS, INC.
300 Erie Boulevard West
Syracuse, New York 13202
March 30, 2001
Dear Shareholder:
I am pleased to invite you to the Annual Meeting of Shareholders of
Niagara Mohawk Holdings, Inc. scheduled to be held on Tuesday, May 15, 2001, at
10:30 a.m. (EDT), in Buffalo, New York.
• This year you will be asked to elect five directors to Class I.
• At the meeting, we will present a report on the pending acquisition of
the Company by National Grid Group plc ("National Grid"), the
Company's past performance, and on other matters of current interest
to our shareholders.
• If you plan to attend the meeting, please check the appropriate box on
your proxy card and detach the admission card to present at the
meeting registration tables.
• Shareholders of record may vote their shares by using the internet or
the telephone. Instructions for using these convenient services are
set forth on the enclosed proxy card. Of course, you may also vote
your shares by completing and signing the enclosed proxy card and
mailing it in the enclosed postage-paid envelope.
If you require special assistance at the meeting because of a disability,
please contact the Office of the Secretary, Syracuse, NY 13202, at
(315) 428-6943.
Sincerely,
William E. Davis
Chairman of the Board and
Chief Executive Officer
[LOGO]
HOLDINGS, INC.
300 Erie Boulevard West
Syracuse, New York 13202
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
DATE & TIME: Tuesday, May 15, 2001, at 10:30 A.M. (EDT)
PLACE: Adam's Mark Buffalo Niagara
120 Church Street
Buffalo, New York 14202
ITEMS OF BUSINESS:
(1) Election of Salvatore H. Alfiero, Albert J. Budney, Jr.,
Robert L. Culver, Dr. Bonnie G. Hill and Clark A. Johnson to
serve in Class I for a 3-year term expiring at the 2004 Annual
Meeting; and
(2) To transact other business that may properly come before the
meeting or any adjournments of the meeting.
RECORD DATE: The Board of Directors has fixed the close of business on
March 19, 2001 as the record date for the purpose of
determining shareholders who are entitled to notice and to
vote at the meeting.
PROXY VOTING: Shareholders of record may vote by mail, telephone or on-line
via the internet.
Your vote is important to us. If you do attend and vote at the
Annual Meeting, your vote in person will supersede any earlier
vote by proxy.
By Order of the Board of Directors,
Kapua A. Rice
Secretary
March 30, 2001
TABLE OF CONTENTS
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Page
About the Meeting
Who can attend the meeting? .................................................. 2
Who can speak at the meeting? ................................................ 2
What are shareholders being asked to vote on? ................................ 2
Voting Procedures
How many shares are outstanding and entitled to vote? ........................ 3
What constitutes a quorum? ................................................... 3
Who is eligible to vote? ..................................................... 3
How do shareholders vote? .................................................... 3
How do shareholders vote if their shares are held in the name of a broker? ... 3
How do shareholders vote if their shares are held in the Company's 401(k)? ... 3
Can shareholders change their vote? .......................................... 4
How many votes are required? ................................................. 4
How will proxies be voted if other matters are raised? ....................... 4
Are votes confidential? ...................................................... 4
Nomination and Election of Directors
Who is being nominated to serve as directors? ................................ 4
Did the Company receive any director nominations from shareholders? .......... 5
What is the business background for each of the nominees and directors? ...... 5
--Nominees for Class I Directors whose terms expire in 2004 .................. 5
--Class II Directors whose terms expire in 2002 .............................. 6
--Class III Directors whose terms expire in 2003 ............................. 7
Board Meetings--Committees of the Board
How often did the Board meet in 2000? ........................................ 8
What committees has the Board established and how often did they meet? ....... 8
What are the primary functions of the Audit Committee and the
Compensation and Succession Committee? ..................................... 9
Board of Directors' Audit Committee Report ..................................... 10
Director Compensation
How are directors compensated? ............................................... 11
Did the Company enter into any transactions with directors? .................. 12
What did directors receive in the form of health and life insurance benefits? 12
Stock Ownership Information
Who are the largest owners of the Company's stock? ........................... 12
How much stock do the Company's directors and executive officers own? ........ 13
Were there any late filings under Section 16(a) Beneficial Ownership
Reporting Compliance? ....................................................... 14
Board of Directors' Compensation and Succession Committee Report on
Executive Compensation
What is the Company's philosophy on executive officer compensation? .......... 14
How is the Company's Chief Executive Officer compensated? .................... 15
Executive Compensation
Summary Compensation Table ................................................... 17
Options/SAR Grants in Last Fiscal Year ....................................... 19
Aggregated Option/SAR Exercises in Last Fiscal Year and Fiscal Year-End
Option/SAR Values ......................................................... 20
Performance Graph ............................................................ 20
Retirement Benefits and Employment Agreements
Niagara Mohawk Pension Plan .................................................. 21
Supplemental Executive Retirement Plan ....................................... 21
Annual Retirement Allowance .................................................. 22
Employment Agreements ........................................................ 22
Change to By-Laws .............................................................. 24
Other Information
What is the deadline for submitting a proposal for next year's annual meeting? 24
What does the Company pay for indemnification insurance? ..................... 24
How much will it cost the Company to solicit votes? .......................... 24
Who is the Company's independent accountant? ................................. 25
-- Audit Fees ............................................................... 25
-- All Other Fees ........................................................... 25
Who do I contact to receive Quarterly Reports? ............................... 25
Appendix A: Audit Committee Charter ........................................... A-1
Appendix B: By-Laws of Niagara Mohawk Holdings, Inc., Article VI, Section 6.6 . A-5
NIAGARA MOHAWK HOLDINGS, INC.
300 Erie Boulevard West
Syracuse, New York 13202
PROXY STATEMENT
This proxy statement and the accompanying proxy card are being furnished in
connection with the solicitation by the Board of Directors (the "Board of
Directors" or the "Board") of Niagara Mohawk Holdings, Inc. ("NM Holdings"
or the "Company") for use at its 2001 Annual Meeting of Shareholders on
Tuesday, May 15, 2001, at 10:30 a.m.(EDT) and at any adjournment or
postponement. These proxy materials, together with the 2000 Annual Report of
Niagara Mohawk Holdings, Inc. are first being mailed to shareholders on or
about March 30, 2001.
About the Meeting
Who can attend the meeting?
Attendance will be limited to:
• shareholders of record;
• beneficial owners of common stock entitled to vote at the meeting
having evidence of ownership;
• the authorized representative of an absent shareholder; and
• invited guests of management.
Any person who owns shares of NM Holdings in the name of a bank, broker or
other holder of record must show proof of ownership. Proof of ownership may be
in the form of a letter or a recent statement from the bank or broker showing
ownership of NM Holdings' common stock.
Any person claiming to be an authorized representative of a shareholder must,
upon request, produce written evidence of the authorization.
Cameras, recording devices and other electronic devices will not be permitted
at the meeting.
Who can speak at the meeting?
In order to assure a fair and orderly meeting and to accommodate as many
shareholders as possible who may wish to speak at the meeting, management will
permit only shareholders or their authorized representatives to address the
meeting.
What are shareholders being asked to vote on?
• The election of Salvatore H. Alfiero, Albert J. Budney, Jr., Robert L.
Culver, Dr. Bonnie G. Hill, and Clark A. Johnson to serve as directors
in Class I for a 3-year term expiring at the 2004 Annual Meeting of
Shareholders. Of course, these terms would end earlier if the pending
National Grid merger receives all necessary approvals and becomes
effective.
• Management does not know of any matters to be presented for action at
the annual meeting other than the election of directors.
Voting Procedures
How many shares are outstanding and entitled to vote?
At the close of business on the record date, March 19, 2001, there were
160,239,818 shares of NM Holdings' common stock outstanding and entitled
to vote at the annual meeting. Each share of common stock is entitled to one
vote.
What constitutes a quorum?
A majority of the shares entitled to vote at the meeting shall constitute a
quorum. Abstentions and brokernon-votes will be counted in the number of
shares present, in person or by proxy, for purposes of determining a quorum. A
broker non-vote occurs when a broker does not have discretionary voting power
to vote on a specific matter and has not received instructions from the
beneficial owner.
Who is eligible to vote?
Only shareholders of common stock whose names appeared on the books of NM
Holdings on the record date, March 19, 2001, will be entitled to vote at the
meeting and at any adjournment thereof.
How do shareholders vote?
Whether or not you plan to attend, please take the time to vote. Shareholders
may vote by mail, telephone or on-line via the internet. The telephone and
internet procedures authenticate shareholders by use of a control number and
permit confirmation that the vote has been properly recorded. Also, please be
advised that you do not need to return your proxy card if you vote by telephone
or via the internet.
• BY MAIL: Please mark your vote, sign, date and promptly return
your proxy card in the enclosed postage-paid envelope.
• BY TELEPHONE: Please call the toll-free telephone number on your
proxy card (800-250-9081). Once connected, you will be prompted to
record and confirm your vote. Telephone voting is available 24 hours
a day, through Monday, May 14, 2001, 11:59 P.M. (EDT).
• VIA INTERNET: You may vote on-line by using the following
internet address: http://www.votefast.com. Specific instructions
will be available, allowing you to record and confirm your vote.
Internet voting is available 24 hours a day, through Monday,
May 14, 2001, 11:59 P.M. (EDT).
How do shareholders vote if their shares are held in the name of a broker?
If your shares are held in "street name" (that is, through a broker or other
nominee), you will receive a proxy card from your broker seeking instruction as
to how your shares should be voted. If no instructions are given, your broker
may vote your shares at its discretion on your behalf in accordance with the
rules of the New York Stock Exchange.
How do shareholders vote if their shares are held in the Company's 401(k)?
If you participate in the Company's Non-Represented or Represented Employees'
Savings Fund Plans, you will receive a proxy card from Fidelity Management
Trust Co. (Trustee) seeking instruction as to how your shares should be voted.
If no instructions are given, your shares will be voted in the same proportion
as shares voted by other plan participants.
Can shareholders change their vote?
A shareholder who has executed and returned a proxy may revoke it at any time
before it is voted by:
• submitting a properly signed proxy with a later date by mail or voting
again at a later time by telephone or internet; or
• sending a written statement to that effect to the Secretary of NM
Holdings; or
• voting in person at the annual meeting (if your shares are registered
directly on the Company's books and not held through a broker, bank, or
other nominee).
How many votes are required?
Election of Directors. The affirmative vote of a plurality of votes cast at
the meeting is required for the election of directors.
How will proxies be voted if other matters are raised?
Other Matters. If other matters are properly brought before the meeting
or at any adjournment, the persons named on the enclosed proxy card intend to
vote the shares represented by them in accordance with their best judgment.
Abstentions and broker non-votes will not be considered as votes cast with
respect to a particular matter.
Are votes confidential?
Under the By-Laws, tabulation of proxies and the votes cast at the meeting is
conducted by an independent agent and certified by independent inspectors of
election. Any information which would identify the vote of any shareholder is
held permanently confidential and will not be disclosed to the Company, except
as may be necessary to meet any legal requirements.
Nomination and Election of Directors
The Board of Directors is divided into three classes, composed of as nearly
equal a number of directors as is possible, with staggered terms of office so
that one class of the directors must be elected at each annual meeting.
Presently, the Board of Directors consists of fourteen directors. Mr. Henry A.
Panasci, Jr.'s current term as director expires at this Annual Meeting of
Shareholders, and he will not be standing for re-election. Mr. Panasci has
reached the mandatory retirement age for directors. His contributions were
many and are gratefully appreciated. The Company will have thirteen directors
following the 2001 Annual Meeting.
Who is being nominated to serve as directors?
This year, you are being asked to vote for the following nominees to serve as
directors in Class I until the 2004 Annual Meeting of Shareholders. Mr.
Culver, who joined the Board on June 14, 2000, is being proposed for election
by the shareholders to the Board of Directors for the first time.
• Salvatore H. Alfiero
• Albert J. Budney, Jr.
• Robert L. Culver
• Dr. Bonnie G. Hill
• Clark A. Johnson
All nominees are currently directors of the Company and have consented to serve
a 3-year term. Each nominee elected as a director will continue in office until
his term expires or until his successor has been elected.
The terms of all directors, including those being elected at the 2001 Annual
Meeting, would terminate following the National Grid merger.
Directors will be elected by a plurality of the votes cast at the meeting.
Did the Company receive any director nominations from shareholders?
The Company has not received any notices of proposed shareholder nominations
for the 2001 Annual Meeting. In accordance with the Company By-Laws, any
nominations for director must have been received by the Secretary between
90-120 days before the meeting.
What is the business background for each of the nominees and directors?
The principal occupation, age as of January 1, 2001, and certain other
information about each of the nominees and other directors whose terms of
office continue after the 2001 Annual Meeting is as follows.
With the exception of Messrs. Culver and Dalton, prior to the creation of the
Company as a holding company, each director of the Company served as a director
of Niagara Mohawk Power Corporation ("NMPC"), now a subsidiary of the Company.
The length of term as a director reflects such director's service with NMPC.
NOMINEES FOR CLASS I DIRECTORS WHOSE TERMS EXPIRE IN 2004
SALVATORE H. ALFIERO
• Former Chairman and Chief Executive Officer, Mark IV Industries, Inc.
• Director since 1998
• Member of Executive, Corporate Public Policy & Environmental Affairs
and Finance (Chair) Committees of the Board
Mr. Alfiero, age 63, former Chairman and Chief Executive Officer, Mark IV
Industries, Inc., a manufacturer of engineered systems and components for power
transmission, fluid power and transfer, and filtration applications,
located in Amherst, NY. Mr. Alfiero founded Mark IV Industries, Inc. in 1969
and retired as Chairman and Chief Executive Officer on September 14, 2000.
Director of HSBC USA; HSBC Bank USA Inc. (formerly Marine Midland Bank);
Phoenix Home Life Mutual Insurance Company; and Southwire Company.
ALBERT J. BUDNEY, JR.
• President of the Company
• Director since 1995
Mr. Budney, age 53, has been President of NM Holdings (and, before the creation
of the holding company, NMPC)since1995. Director of Opinac North America, Inc.
("Opinac NA"); Niagara Mohawk Energy, Inc. ("NM Energy"); Canadian Niagara
Power Company, Limited ("CNP"); and Utilities Mutual Insurance Company. Mr.
Budney also serves as a director of two companies in which Opinac NA has made
investments: Telergy, Inc., a regional fiber-optic telecommunications
provider, and eVonyx, Inc., a manufacturer of alternative energy technology
products. Mr. Budney is also President and Chief Executive Officer of Opinac
NA and President of Opinac Energy Corporation ("Opinac"). Opinac NA is a
wholly-owned subsidiary of the Company and holds 100 percent of NM Energy and,
through its subsidiary, Opinac, a 50 percent interest in CNP.
ROBERT L. CULVER
• Executive Vice President and Chief Financial Officer, Cabot Corporation
• Director since 2000
• Member of Audit and Finance Committees of the Board
Mr. Culver, age 52, Executive Vice President and Chief Financial Officer, Cabot
Corporation, a specialty chemical manufacturer, located in Boston MA. Prior to
joining Cabot Corporation in 1997, Mr. Culver was Senior Vice President and
Treasurer of Northeastern University.
DR. BONNIE G. HILL
• Senior Vice President-Communications and Public Affairs of The Los
Angeles Times; President and Chief Executive Officer of The Times
Mirror Foundation
• Director since 1991
• Member of Executive, Audit and Corporate Public Policy & Environmental
Affairs (Chair) Committees of the Board
Dr. Hill, age 59, Senior Vice President-Communications and Public Affairs of
The Los Angeles Times, a news and information company, and President and Chief
Executive Officer of The Times Mirror Foundation, a non-profit institution,
located in Los Angeles, CA. From 1992-1996, Dr. Hill served as Dean and
Professor of Commerce of the McIntire School of Commerce at the University of
Virginia. Director of AK Steel Corporation; Hershey Foods Corporation; and The
Home Depot, Inc.
CLARK A. JOHNSON
• Chairman of the Board, PSS World Medical, Inc.
• Director since 1998
• Member of Audit, Compensation and Succession and Finance Committees of
the Board
Mr. Johnson, age 69, Chairman of the Board, PSS World Medical, Inc., a leading
specialty marketer and distributor of medical products and equipment to
physicians, hospitals and other health care providers, located in Jacksonville,
FL. Mr. Johnson was elected to his present position in October 2000. In 1999,
Mr. Johnson retired as Chairman of Pier 1 Imports, Inc., a specialty retailer
of imported home furnishings, gifts and related items, located in Forth Worth,
TX. He served as Chairman and Chief Executive from 1987, serving in that
capacity until elected Chairman in 1998. Director of Albertson's Inc.;
InterTAN Inc.; Metromedia International Group; PSSI World Medical; and REFCO,
Inc.
CLASS II DIRECTORS WHOSE TERMS EXPIRE IN 2002
WILLIAM F. ALLYN
• Chairman and Chief Executive Officer of Welch Allyn Ventures LLC
• Director since 1988
• Member of Audit, Compensation and Succession and Nuclear Oversight
Committees of the Board
Mr. Allyn, age 65, Chairman and Chief Executive Officer of Welch Allyn Ventures
LLC, Skaneateles Falls, NY, a holding company of three separate businesses:
Welch Allyn, Inc., a manufacturer of medical, dental and lighting products;
Welch Allyn Data Collection Inc., which makes bar code readers; and Everest VIT
Inc., which makes remote visual inspection devices for boilers, jet engines and
nuclear reactors. Mr. Allyn was elected to his present position in 1999,
effective January 2000. From 1980-1999, he served as President and Chief
Executive Officer of Welch Allyn, Inc. Director of M&T Corporation; Oneida
Limited; Perfex Corporation; and Welch Allyn, Inc.
WILLIAM E. DAVIS
• Chairman of the Board and Chief Executive Officer of the Company
• Director since 1992
• Chair of Executive Committee of the Board
Mr. Davis, age 58, has been Chairman of the Board and Chief Executive Officer
of NM Holdings (and, before the creation of the holding company, NMPC), since
1993. Director of Opinac NA; NM Energy; NMPC; CNP; and Utilities Mutual
Insurance Company. Mr. Davis is also the Chairman of the Board of NM Energy,
Opinac NA and NMPC and holds the position of Secretary, Utilities Mutual
Insurance Company.
ANTHONY H. GIOIA
• Chairman and Chief Executive Officer of Gioia Management, Inc.
• Director since 1996
• Member of Audit, Compensation and Succession and Nuclear Oversight
Committees of the Board
Mr. Gioia, age 59, Chairman and Chief Executive Officer of Gioia Management,
Inc., a holding company for Cello-Pack Corporation and other investments in
Western New York. Mr. Gioia has held his present position since
1987. Director of Greater Buffalo Savings Bank and Kaleida Health Systems. A
wholly-owned subsidiary of Gioia Management, Inc., of which subsidiary Mr.
Gioiais Chair, filed for protection under the federal bankruptcy laws in 1999.
DR. PATTI McGILL PETERSON
• Executive Director of the Council for International Exchange of
Scholars and Vice President of the Institute of International Education
• Director since 1988
• Member of Executive, Audit (Chair) and Corporate Public Policy &
Environmental Affairs Committees of the Board
Dr. Peterson, age 57, Executive Director of the Council for International
Exchange of Scholars, Washington, DC, and Vice President of the Institute of
International Education, New York, NY, affiliated non-profit institutions
which develop partnerships between the public and private sectors in education,
business, science, engineering, the environment and the arts in 170 nations.
From 1996 to 1997, Dr. Peterson was a Senior Fellow of the Cornell Institute
for Public Affairs, Cornell University, Ithaca, NY. Dr. Peterson also served
as President of St. Lawrence University from 1987-1996, and is President
Emerita. Independent Trustee of John Hancock Mutual Funds.
CLASS III DIRECTORS WHOSE TERMS EXPIRE IN 2003
LAWRENCE BURKHARDT, III
• Retired Rear Admiral, United States Navy
• Director since 1988
• Chair of Nuclear Oversight Committee of the Board
Mr. Burkhardt, age 68, independent consultant to the nuclear industry since
1990. Prior to his retirement in 1990, Mr. Burkhardt was employed by NMPC and
served as Executive Vice President of Nuclear Operations.
JOHN H. DALTON
• President, IPG Photonics
• Director since 1999
• Member of Corporate Public Policy & Environmental Affairs, Finance and
Nuclear Oversight Committees of the Board
Mr. Dalton, age 59, President of IPG Photonics, a leading global manufacturer
of high-power fiber amplifiers, lasers and transmitters, located in Washington,
DC. Mr. Dalton was elected to his present position in 2000. Prior to that, he
served as Chairman and Chief Executive Officer of Metal Technology, Inc. from
1999-2000. From 1993-1998, he served as Secretary of the Navy. Director of
Cantor Exchange, Fresh Del Monte Produce, Inc. and TransTechnology Corporation.
WILLIAM J. DONLON
• Former Chairman of the Board and Chief Executive Officer of NMPC
• Director since 1980
Mr. Donlon, age 70, retired in 1993 as Chairman of the Board and Chief
Executive Officer of NMPC with 45 years of service.
STEPHEN B. SCHWARTZ
• Retired Senior Vice President, International Business Machines
Corporation
• Director since 1992
• Member of Executive, Compensation and Succession (Chair) and Finance
Committees of the Board
Mr. Schwartz, age 66, retired in 1992 as Senior Vice President of International
Business Machines Corporation, after working at IBM for almost 35 years.
Director of MFRI, Inc.
Board Meetings--Committees of the Board
How often did the Board meet in 2000?
During 2000, the Board of Directors held fourteen meetings. Each director
attended more than 75 percent of the meetings of the Board and Board Committees
on which he or she served in 2000.
What committees has the Board established and how often did they meet?
The Board Committees consist of an Executive Committee, Audit Committee,
Committee on Corporate Public Policy & Environmental Affairs, Compensation and
Succession Committee, Finance Committee, and Nuclear Oversight Committee. The
Compensation and Succession Committee acts as a nominating committee in
recommending candidates for Board membership.
BOARD COMMITTEE MEMBERS
Corp. Public Compensa-
Executive Audit Policy & Env. tion and Finance Nuclear
Name Affairs Succession Oversight
- ---------------- --------- ------ --------------- ------------ ------- ----------
S. H. Alfiero X X X*
W. F. Allyn X X X
A. J. Budney, Jr.
L. Burkhardt, III X*
R. L. Culver X X
J. H. Dalton X X X
W. E. Davis X*
W. J. Donlon
A. H. Gioia X X X
B. G. Hill X X X*
C. A. Johnson X X X
H. A. Panasci,Jr. X X X
P. M. Peterson X X* X
S. B. Schwartz X X* X
- ---------------- ----------- ---------- ------------- ------------- ----------- ---------
No. of Meetings
in 2000 0 9 4 10 6 9
- ---------------- ----------- ---------- ------------- ------------- ----------- ---------
*Chair
With the exception of the Executive Committee, membership on the Board
Committees is limited to non-employee directors.
What are the primary functions of the Audit Committee and the Compensation
and Succession Committee?
Audit Committee
The primary function of the Audit Committee is to assist the Board of Directors
(i) in its oversight of the Company's accounting and financial reporting
principles and policies and internal accounting controls and procedures, (ii)
in its oversight of the Company's financial statements and the independent
audit thereof, (iii) in selecting, evaluating and, where deemed appropriate,
replacing the independent auditor, and (iv) in evaluating the independence of
the independent auditor. A copy of the Audit Committee Charter is attached to
this proxy statement as Appendix A.
The membership of the Audit Committee consists only of directors of the Company
who are not, and have not been, officers of the Company.
Compensation and Succession Committee
The primary function of the Compensation and Succession Committee is to ensure
that the compensation and benefits available to the Board of Directors, senior
management and other Company officers and employees enables the Company to
attract and retain qualified individuals.
The Compensation and Succession Committee also conducts an annual evaluation of
the Company's Chief Executive Officer and makes recommendations where
appropriate concerning annual performance evaluations for senior officers;
senior officer succession plans; officer and director candidates; compensation
and benefit plans; Board and officer compensation; Board effectiveness;
diversity strategies and plans; and performance of the Company's actuarial
advisor toward funding the Company's Pension Plan, Post-Retirement Benefits
Other Than Pension Plan, and Supplemental Executive Retirement Plan.
The membership of the Compensation and Succession Committee consists only of
directors of the Company who are not, and have not been, officers of the
Company.
Board of Directors' Audit Committee Report
The role of the Audit Committee is to assist the Board of Directors in its
oversight of the Company's financial reporting process. The Board of
Directors, in its business judgment, has determined that all members of the
Committee are "independent", as required by applicable listing standards of the
New York Stock Exchange. The Committee operates pursuant to a Charter that was
last amended and restated by the Board on February 15, 2001, a copy of which is
attached to this proxy statement as Appendix A. As set forth in the Charter,
management of the Company is responsible for the preparation, presentation and
integrity of the Company's financial statements, the Company's accounting and
financial reporting principles and internal controls and procedures designed to
assure compliance with accounting standards and applicable laws and
regulations. The independent auditors are responsible for auditing the
Company's financial statements and expressing an opinion as to their conformity
with generally accepted accounting principles.
In the performance of its oversight function, the Committee has considered and
discussed the audited financial statements with management and the independent
auditors. The Committee has also discussed with the independent auditors the
matters required to be discussed by Statement on Auditing Standards No. 61,
Communication with Audit Committees, as currently in effect. Finally, the
Committee has received the written disclosures and the letter from the
independent auditors required by Independence Standards Board Standard No. 1,
Independence Discussions with Audit Committees, as currently in effect, has
considered whether the provision of non-audit services by the independent
auditors to the Company is compatible with maintaining the auditor's
independence and has discussed with the auditors the auditors' independence.
The members of the Audit Committee are not professionally engaged in the
practice of auditing or accounting and are not experts in the fields of
accounting or auditing, including in respect of auditor independence. Members
of the Committee rely without independent verification on the information
provided to them and on the representations made by management and the
independent accountants. Accordingly, the Audit Committee's oversight
does not provide an independent basis to determine that management has
maintained appropriate accounting and financial reporting principles or
appropriate internal control and procedures designed to assure compliance with
accounting standards and applicable laws and regulations. Furthermore, the
Audit Committee's considerations and discussions referred to above do not
assure that the audit of the Company's financial statements has been carried
out in accordance with generally accepted auditing standards, that the
financial statements are presented in accordance with generally accepted
accounting principles or that the Company's auditors are in fact "independent".
Based upon the reports and discussions described in this report, and subject to
the limitations on the role and responsibilities of the Committee referred to
above and in the Charter, the Committee recommended to the Board that the
audited financial statements be included in the Company's Annual Report on
Form 10-K for the year ended December 31, 2000 to be filed with the Securities
and Exchange Commission.
Submitted by the Audit Committee of the Board of Directors
Patti McGill Peterson, Chair
William F. Allyn
Robert L. Culver
Anthony H. Gioia
Bonnie G. Hill
Clark A. Johnson
Director Compensation
How are directors compensated?
Only non-employee directors are compensated for their services. The breakdown
of their compensation is as follows:
Annual Cash Retainer Fees
• $25,000 annual retainer for serving on the Board of Directors.
• $ 4,000 additional annual retainer if serving as a chair of a Board
Committee.
Meeting Fees
• $1,000 for attending each Board meeting.
• $1,000 for each Committee meeting attended.
Directors are reimbursed for their travel, lodging and related expenses.
Outside Director Deferred Stock Unit Plan
In 1996, the Board of Directors adopted an Outside Director Deferred Stock Unit
Plan.
In May 2000, each outside director was credited with deferred stock units
("DSUs") equal in value to $15,000 ($17,000 for Committee Chairs).
Accordingly, all outside directors were credited with 1,091 DSUs (1,236 for
Committee Chairs) based on the average of the opening and closing price of a
share of common stock on May 17, 2000 ($13.75). The beneficial stock ownership
table on page 13, shows the total number of DSUs credited to each of the
outside directors under this plan as of March 15, 2001.
With respect to future DSU grants, each outside director will be credited with
DSUs on an annual basis equal in value to $25,000 ($27,000 for Committee
Chairs). When a director ceases to be an outside director, the amount of DSUs
credited to him or her is paid in a lump sum or in five equal annual
installments. The first DSU installment payment would be made shortly after
the director's service ends and the other installments would be paid on the
first through fourth anniversaries of such date, based on the prevailing stock
price at that time. All outstanding DSUs would be paid following a change in
control of the Company. Outside directors may defer receipt of cash proceeds
from the DSUs. The acquisition of the Company by National Grid would be a
change in control for the purposes of this plan.
Did the Company enter into any transactions with directors?
Lawrence Burkhardt, III, received a consulting fee of $18,000 during 2000.
What did directors receive in the form of health and life insurance
benefits?
The Company provides certain health and life insurance benefits to directors
who are not employees of the Company.
In 1999, the Board of Directors discontinued health care benefits for outside
directors who first join the Board after October 28, 1999. Directors who
joined the Board prior to October 28, 1999 were grandfathered. Outside
directors who elected coverage under the Company's health care plans contribute
a portion of the monthly costs associated with these plans.
During 2000, the following health and life insurance benefits were received by
the following directors: Mr. Alfiero ($612), Mr. Allyn ($406), Mr. Burkhardt
($6,312), Mr. Culver ($137), Mr. Dalton ($5,374), Mr. Donlon ($312), Mr. Gioia
($9,479), Dr. Hill ($5,783), Mr. Panasci ($12), Dr. Peterson ($2,621) and Mr.
Schwartz ($612).
Stock Ownership Information
Who are the largest owners of the Company's stock?
The following table indicates the number of shares of common stock owned by
persons known to the Company to own beneficially more than 5% of the
outstanding Common Stock as of December 31, 2000.
Name and Address of Amount and Nature of Percent
Title of Class Beneficial Owner Beneficial Ownership of Class
Common Stock FMR Corp. 12,209,033(a) 7.619%
82 Devonshire Street
Boston, Massachusetts 02109
Common Stock T. Rowe Price Associates, Inc. 10,688,274(b) 6.6%
100 E. Pratt Street
Baltimore, Maryland 21202
(a) Pursuant to Schedule 13G, dated February 14, 2001, FMR Corp. has sole
power to vote 730,608 shares and the sole power to dispose or to direct
the disposition of 12,209,033 shares.
(b) Pursuant to Schedule 13G, dated February 14, 2001, these securities are
owned by various individual and institutional investors which T. Rowe
Price Associates, Inc. ("Price Associates") serves as investment
adviser with power to direct investments and/or sole power to vote the
securities. For purposes of the reporting requirements of the
Securities Exchange Act of 1934, Price Associates is deemed to be a
beneficial owner of such securities; however, Price Associates
expressly disclaims that it is, in fact, the beneficial owner of such
securities.
Approximately 90% or 143,657,094 shares of the Company's common stock
outstanding as of December 31, 2000, are held by shareholders who elected
to hold their shares not in their own names, but in the names of banking or
financial intermediaries. These shares are registered in the nominee name of
The Depository Trust Company, Cede & Co.
How much stock do the Company's directors and executive officers own?
The following table indicates the number of shares of the Company's common
stock beneficially owned as of March 15, 2001, by each director of the Company,
each of the executive officers named in the Summary Compensation Table below
and the current directors and executive officers of the Company and NMPC as a
group. The table also lists the number of stock units credited to directors,
named executive officers and the directors and executive officers of the
Company and NMPC as a group pursuant to the Company's compensation and benefit
programs as of March 15, 2001. No voting rights are associated with stock
units.
Title of Amount and Nature of Percent Stock Units
Class Name of Beneficial Owner Beneficial Ownership** Of Class Held
Common Stock
Directors:
Salvatore H. Alfiero 5,000 *** 3,281(5)
William F. Allyn 1,500 *** 12,294(5)
Albert J. Budney, Jr. 14,999(1) *** 77,000(6)
Lawrence Burkhardt, III 452 *** 6,326(5)
Robert L. Culver 0 *** 1,050(5)
John H. Dalton 2,000 *** 2,063(5)
William E. Davis 49,804(2) *** 159,000(6)
William J. Donlon 2,010 *** 1,046(5)
Anthony H. Gioia 500 *** 5,447(5)
Bonnie G. HilL 1,000 *** 11,496(5)
Clark A. Johnson 15,000 *** 3,136(5)
Henry A. Panasci, Jr. 2,500 *** 5,447(5)
Patti McGill Peterson 1,500 *** 14,752(5)
Stephen B. Schwartz 500 *** 14,757(5)
Named Executives:
Darlene D. Kerr* 20,001(3) *** 70,500(6)
John H. Mueller* 1,130 *** 40,500(6)
William F. Edwards 2,281 *** 40,500(6)
All Directors and Executive
Officers (24) as a group .... 198,808(4) *** 670,095(6)
* Ms. Kerr and Mr. Mueller are executive officers of Niagara Mohawk Power
Corporation.
** Based on information furnished to the Company by the directors and
executive officers. Includes shares of common stock credited under the
Employees' Savings Fund Plan as of March 15, 2001.
*** Less than one percent.
(1) Includes presently exercisable options for 10,000 shares of common stock.
(2) Includes presently exercisable options for 42,625 shares of common stock.
(3) Includes presently exercisable options for 9,000 shares of common stock.
(4) Includes presently exercisable options for 106,375 shares of common stock.
(5) Represents deferred stock units granted pursuant to the Outside Director
Deferred Stock Unit Plan. For additional information regarding deferred
stock units, refer to page 11 ("Director Compensation").
(6) Represents stock units granted in 1998, 2000 and 2001 pursuant to the
Long-Term Incentive Plan and CEO Special Award Plan. For additional
information regarding the Long-Term Incentive Plan refer to page 15.
Were there any late filings under Section 16(a) Beneficial Ownership
Reporting Compliance?
The rules of the SEC require that the Company disclose late filings of reports
of ownership and changes in ownership of the Company's equity securities by its
directors, executive officers and any other person subject to Section 16 of the
Securities and Exchange Act of 1934. To the best of the Company's knowledge,
there were no late filings during 2000.
Board of Directors' Compensation and Succession Committee Report on Executive
Compensation
The Compensation and Succession Committee of the Board of Directors (the
"Committee") is comprised entirely of non-employee directors. The Committee
has responsibility for recommending officer salaries and for administration
of the Company's officer incentive compensation plans as described in this
report. The Committee makes recommendations to the Board of Directors which
makes final officer compensation determinations.
This Committee report describes the Company's executive officer compensation
policies, the components of the compensation program, and the manner in which
2000 compensation determinations were made for the Company's Chairman of the
Board and Chief Executive Officer, Mr. William E. Davis.
What is the Company's philosophy on executive officer compensation?
The 2000 Executive Officer Compensation Program was comprised of base salary,
annual incentive compensation, and grants of stock units and stock appreciation
rights ("SARs") made pursuant to the Long-Term Incentive Plan ("LTIP") adopted
by the Board of Directors on September 25, 1996, as described later in this
report.
Base Salary
The Committee seeks to ensure that salaries of the Company's officers,
including executive officers, remain competitive with levels paid to
individuals in comparable positions among other U.S. electric and gas utilities
with comparable revenues (collectively referred to as the "Comparator
Utilities"). The Committee believes that competitive salaries provide the
foundation of the Company's officer compensation program and are essential for
the Company to attract and retain qualified officers, especially in light of
the increasing competition within the industry. Each officer position has been
assigned to a competitive salary range. The Committee intends to administer
salaries within the 25th to 75th percentiles of practice with respect to those
Comparator Utilities. The 2000 average salary of the five named executive
officers approximates the 55th percentile of competitive levels.
Annual Officer Incentive Compensation Plan ("OICP")
On December 13, 1990 the Board of Directors adopted the Company's OICP for
officers, which is structured and administered so that a significant component
of each officer's annual cash compensation must be earned on the basis of the
Company's and the officer's annual performance. Maximum incentive award
opportunities for 2000 were set by the Committee at 75% of salary for Mr. Davis
and at 35% to 65% for all other officers (subject to adjustments based on the
performance of the Company's common stock). OICP award opportunities are
intended to position officer annual compensation (salary + OICP awards) within
the 25th to 75th percentile of Comparator Utilities practice depending on
company financial performance, operating performance, and the performance of the
Company's common stock over the course of the year.
For the 2000 plan year, awards were based on the degree to which certain
pre-established financial and operating objectives were met or exceeded. The
objectives for the 2000 plan year included economic value added ("EVA(R)")
and other financial objectives, and business unit/subsidiary operating
objectives and individual objectives. Starting in 1999, the OICP was modified
so that awards would also vary based on the performance of the Company's
common stock during the course of the plan year.
Awards for the named executive officers averaged 61.0% of their 2000 salaries.
Their average annual compensation (salary + OICP awards)fell between the 50th
and 75th percentiles of Comparator Utilities practice. Refer to the Summary
Compensation Table on page 17 for specific amounts paid to named executive
officers under the 2000 OICP. These awards were paid on February 27, 2001.
Long-Term Incentive Plan
On September 25, 1996 the Board of Directors adopted the LTIP to promote the
success and enhance the value of the Company through the retention and
ontinued motivation of executive officers. Through this plan the Board of
Directors seeks to focus efforts on the execution of business strategies
directed toward improving financial returns to shareholders. The LTIP provides
a continuous program of long-term stock incentives to executive officers
through periodic grants of SARs and/or stock units. Dividend equivalents on
stock unit grants, if any, are credited on grants and are paid when the related
stock units are paid.
On January 26, 2000, the Board of Directors approved the grant of LTIP stock
units and SARs for the 2000-2003 performance period. These stock units and any
accumulated dividend stock units, will be paid in early 2004 based on the
average fair market value of the Company's common stock during the last twelve
consecutive trading days in 2003. The SARs first become exercisable on
January 2, 2004 and can be exercised until they expire on December 31, 2010.
stock units and SARs would vest upon a change in control, which the National
Grid merger would be.
The Board of Directors approved a December 13, 2000 grant of stock units for
the performance period 2001-2004. These stock units and any accumulated
dividend stock units will be paid in early 2005 based on the average fair
market value of the Company's common stock during the last twelve trading days
in 2004.
Through the combination of base salary, annual incentive compensation, stock
unit and SAR grants, the Committee seeks to focus the efforts of officers
toward improving, annually and over the longer term, the financial returns for
its shareholders.
How is the Company's Chief Executive Officer compensated?
William E. Davis became Chief Executive Officer of NMPC (and subsequently NM
Holdings) on May 1, 1993. During 2000, Mr. Davis' salary was increased to a
urrent annual rate of $788,000. The increase in Mr. Davis' salary reflected an
evaluation of his performance and competitive compensation practice for the
Comparator Utilities. Mr. Davis' annual salary in 2000, as reported in the
Summary Compensation Table, approximated the 50th percentile relative to
salaries paid to CEOs at electric and gas utilities with comparable revenues.
With respect to 2000, Mr. Davis earned an annual incentive compensation award
in the amount of $592,078. This award was paid pursuant to the terms of the
OICP which included financial, operating and individual objectives approved by
the Committee for 2000. In addition, starting in 1999 the annual OICP was
modified so that awards would also vary based on the performance of the
company's common stock during the course of the plan year. Mr. Davis' 2000
annual compensation (salary + OICP award) approximates the 60th percentile of
Comparator Utilities practice.
On January 26, 2000, the Board of Directors approved a grant to Mr. Davis of
LTIP stock units and SARs for the 2000-2003 performance period. This grant
consisted of 29,000 stock units and 90,000 SARs with an exercise price
of $13.51. On December 13, 2000 the Board of Directors approved a grant to Mr.
Davis consisting of 74,000 stock units for the performance period 2001-2004.
The competitiveness of the compensation Mr. Davis actually realizes from the
LTIP grants will depend on the market value of the Company's common stock at
the end of 2003 and 2004 or sooner in the event of a change in control.
Under Section 162(m) of the Internal Revenue Code, the Company may not deduct
certain compensation in excess of $1,000,000 paid to a named executive officer
in any taxable year. The Committee believes it is important to maintain
flexibility in its executive compensation plans in order to attract and retain
high quality executives, which may result in compensation being paid in a
particular year in excess of the limit. In 2000 the compensation of Mr. Davis
exceeded the limit.
Submitted by the Compensation and Succession Committee of the Board of
Directors:
Stephen B. Schwartz, Chair
William F. Allyn
Anthony H. Gioia
Clark A. Johnson
Henry A. Panasci, Jr.
Executive Compensation
The following table shows, for the last three fiscal years, cash and other
compensation paid to the Chairman of the Board and Chief Executive Officer and
to each of the other four most highly compensated executive officers of
the Company and/or NMPC for fiscal year ended December 31, 2000.
SUMMARY COMPENSATION TABLE
Fiscal Years 2000, 1999 and 1998
Annual Compensation Long-Term Compensation
Awards
Other Securities
Annual Restricted Underlying All Other
Compen- Stock Options/ Compen-
Name and Principal Year Salary Bonus sation Awards SARs sation
Position ($)(A) ($) ($)(B) ($)(C) (#) ($) (E)
- --------------------- --------- -------- --------- ----------- ----------- ---------- -----------
W. E. Davis 2000 754,654 592,078 0 1,591,750 90,000 43,878
Chairman and CEO 1999 652,993 78,580 0 0 0 39,003
1998 530,001 180,937 218 1,256,500(D) 325,000(D) 44,539
- --------------------- --------- -------- --------- --------- ------------- ---------- -----------
A. J. Budney, Jr. 2000 493,995 416,709 0 881,063 50,000 31,866
President 1999 444,333 150,540 0 0 0 28,949
1998 366,001 124,949 218 503,750(D) 170,000(D) 18,051
- --------------------- --------- -------- --------- --------- ------------- ---------- -----------
D. D. Kerr * 2000 428,881 164,596 0 830,563 40,000 15,573
President & COO 1999 345,001 44,190 0 0 0 12,317
1998 256,334 79,942 218 371,100(D) 119,000(D) 9,583
- -------------------- --------- -------- --------- --------- ------------- ----------- -----------
J. H. Mueller * 2000 332,001 201,664 0 425,938 25,000 12,696
Senior Vice President 1999 309,001 20,040 0 0 0 9,961
1998 255,835 48,519 11,585 324,413(D) 104,000(D) 30,529
- --------------------- --------- -------- --------- --------- ------------- ----------- -----------
W. F. Edwards 2000 331,663 142,816 0 425,938 25,000 80,699
Senior Vice President 1999 269,667 38,060 0 0 0 25,646
1998 221,501 62,571 218 290,313(D) 89,000(D) 9,731
- --------------------- --------- -------- --------- --------- ------------- ---------- -----------
*Ms. Kerr and Mr. Mueller are executive officers of Niagara Mohawk Power
Corporation.
(A) Includes all employee contributions to the Employees' Savings Fund Plan.
(B) Other Annual Compensation for Mr. Mueller in 1998 represents or
includes amounts reimbursed for payment of taxes associated with
relocation expenses. 1998 Other Annual Compensation for Messrs. Davis,
Budney, Mueller and Edwards and Ms. Kerr represents or includes amounts
reimbursed for payment of taxes associated with non-cash compensation.
(C) In 1998, 82,700 stock units were granted in January and 118,000 in
August (consisting of two grants of 59,000 each) to the above-named
executive officers pursuant to the LTIP adopted by the Board of
Directors on September 25, 1996. The first grant was made for a 3-year
period January 1, 1998 through December 31, 2000, which vested and
became payable on December 31, 2000; the second grant was made for a
3-year period January 1, 1999 through December 31, 2001, which will
vest and become payable on December 31, 2001; and the third grant was
made for a 3-year period January 1, 2000 through December 31, 2002,
which will vest and become payable on December 31, 2002. In the event
of a change in control, all outstanding stock units would vest and
become payable. The 1998 values listed in the table were calculated by
multiplying the stock units granted in January by $11.00 and those
granted in August by $15.5625, the closing prices of the Company's
common stock at the time these stock unit grants were made. Dividend
equivalents, if any, will be credited on the outstanding grants and
will be paid when the related stock units are paid.
In 1999, no stock units were granted to the above-named executive
officers from the LTIP.
In 2000, the Board of Directors approved two distinct grants in
accordance with the LTIP. The first grant was made in January for the
4-year period 2000 through 2003 which consisted of 72,000 stock units
to the above-named executive officers. These stock units will vest
and become payable after December 31, 2003. The value of these stock
units was calculated by multiplying the number of stock units granted
in January by the closing price of the Company's common stock on the
date of the grant which was $12.625. The second grant was made in
December for the 4-year period 2001 through 2004 which consisted
of 196,000 stock units to the above-named executive officers. These
stock units will vest and become payable after December 31, 2004. Both
grants of stock units will vest upon a change in control of the
Company. The value of these stock units was calculated by multiplying
the number of stock units granted in December by $16.5625.
As of the end of the 2000 fiscal year, based on a closing market price
of $16.6875, for grants made from the LTIP, Mr. Davis held 194,000
stock units having a market value of $3,237,375; Mr. Budney held
94,500 stock units having a market value of $1,576,969; Ms. Kerr held
80,100 stock units having a market value of $1,336,669; Mr. Mueller
held 51,600 stock units having a market value of $861,075; and Mr.
Edwards held 48,500 stock units having a market value of $809,344.
(D) This amount represents three distinct grants from the LTIP. The first
grant vested and became payable (in the case of stock units) on
December 31, 2000 and exercisable (in the case of SARs) on January 2,
2001; the second grant will vest after December 31, 2001; and the third
after December 31, 2002. These grants will vest upon a change in
control of the Company.
( E) All Other Compensation for 2000 includes: employer contributions to the
Company's Employees' Savings Fund Plan: Mr. Davis ($5,100), Mr. Budney
($5,100), Ms. Kerr ($5,100), Mr. Mueller ($5,100) and Mr. Edwards,
($5,100); taxable portion of life insurance premiums: Mr. Davis
($5,538), Mr. Budney ($1,894), Ms. Kerr ($1,807), Mr. Mueller ($2,138)
and Mr. Edwards ($1,325); employer contributions to the Company's
Excess Benefit Plan: Mr. Davis ($19,239), Mr. Budney ($10,872), Ms.
Kerr ($8,666), Mr. Mueller ($5,458) and Mr. Edwards ($5,550); directors
fees received from Canadian Niagara Power Corporation: Mr. Davis
($14,000) and Mr. Budney ($14,000); payments of stock units from the
CEO Special Award Plan: Mr. Edwards ($68,725).
The following table discloses, for the Chairman of the Board and Chief
Executive Officer, Mr. William E. Davis, and the other named executive
officers, the number and terms of SARs granted during the fiscal year ended
December 31, 2000.
Options/SAR Grants in Last Fiscal Year
Name Individual Grants
Number of % of Total to
Securities Employees in Exercise pr Grant Date
Underlying Options/SARs Base Price Expiration Date Present Value
Options/SARs Granted Fiscal Year ($/Sh) (A) ($)(B)
Granted
- ------------------- ------------- -------------------- ---------------- ------------------- --------------
W. E. Davis 90,000 14.99 13.51 12/31/2010 628,200
- ------------------- ------------- -------------------- ---------------- ------------------- --------------
A. J. Budney, Jr. 50,000 8.33 13.51 12/31/2010 349,000
- ------------------- ------------- -------------------- ---------------- ------------------- --------------
D. D. Kerr 40,000 6.66 13.51 12/31/2010 279,200
- ------------------- ------------- -------------------- ---------------- ------------------- --------------
J. H. Mueller 25,000 4.16 13.51 12/31/2010 174,500
- ------------------- ------------- -------------------- ---------------- ------------------- --------------
W. F. Edwards 25,000 4.16 13.51 12/31/2010 174,500
- ------------------- ------------- -------------------- ---------------- ------------------- --------------
(A) In January 2000, the Board of Directors made a grant of SARs under the
LTIP. The grant becomes exercisable January 2, 2004 and expires on
December 31, 2010. All SARs become exercisable upon a change in
control.
(B) The grant date present value of SARs is calculated using the
Black-Scholes Option Pricing Model with the following assumptions:
exercise price of rights that expire on December 31, 2010 ($13.51);
stock volatility 24.36%; dividend yield 0%; risk free rate 5.32%;
exercise term (11 years); Black-Scholes ratio .5167; and Black-Scholes
value $6.98 for rights that expire on December 31, 2010. Stock
volatility and dividend yield assumptions are based on 36 months of
results for the period ending December 31, 1999.
The following table summarizes exercises of options by the Chairman of the
Board and Chief Executive Officer, Mr. William E. Davis, and the other named
executive officers, the number of unexercised SARs and options held by them
and the spread (the difference between the current market price of the stock
and the exercise price of the SAR or option, to the extent that market price at
the end of the year exceeds exercise price) on those unexercised SARs or
options for fiscal year ended December 31, 2000.
Aggregated Option/SAR Exercises in Last Fiscal Year
and Fiscal Year-End Option/SAR Values
Number of Securities
Underlying Unexercised Value of Unexercised
Options/ Options/SARs At Fiscal Options/SARs At Fiscal
SARs Value Year-End (#) Year-End ($)(A)
Name Exercised Realized
(#) ($) Exercisable Unexercisable Exercisable Unexercisable
- ----------------- ----------- ---------- --------------- ------------------ ------------- ----------------
W. E. Davis 0 0 345,125 415,000 2,107,544 1,274,913
- ----------------- ----------- ---------- --------------- ------------------ ------------- ----------------
A. J. Budney, Jr. 0 0 156,000 220,000 1,033,250 696,750
- ----------------- ----------- ---------- --------------- ------------------ ------------- ----------------
D. D. Kerr 0 0 68,000 159,000 419,700 459,013
- ----------------- ----------- ---------- --------------- ------------------ ------------- ----------------
J. H. Mueller 0 0 0 129,000 0 391,438
- ----------------- ----------- ---------- --------------- ------------------ ------------- ----------------
W. F. Edwards 0 0 14,400 114,000 105,350 304,625
- ----------------- ----------- ---------- --------------- ------------------ ------------- ----------------
- ---------------
(A) Calculated based on the closing market price of the Company's common stock on December 29, 2000
($16.6875).
