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Base Salary

The Company provides named executive officers and other employees with base salary to compensate them for services rendered during the fiscal year. Base salary ranges for named executive officers are determined for each executive based on his or her position and responsibility by using market data. Base salary ranges are designed so that salary opportunities for a given position will be between 80% and 125% of the midpoint of the base salary established for each range.

During its review of base salaries for executives, the Committee primarily considers:

Salary levels are typically considered annually as part of the Companys performance review process as well as upon a promotion or other change in job responsibility. Merit based increases to salaries of members of the ELT are based on the Committees assessment of the individuals performance.

Performance-Based Incentive Compensation

The 2007 Management Incentive Plan (the 2007 MIP) was approved by the Companys stockholders at the 2006 Annual Meeting of Stockholders and is the successor plan to the 1997 Management Incentive Plan (the 1997 MIP), which expired on December 31, 2006. The management incentive plans give the Committee the latitude to design cash and stock-based incentive compensation programs to promote high performance and achievement of corporate goals by Directors and key employees, encourage the growth of stockholder value and allow key employees to participate in the long-term growth and profitability of the Company. The 1997 MIP will continue to govern all awards granted for performance through December 31, 2006, even if not paid until 2007 or thereafter. Worldwide, the Company currently has approximately 760 key employees (including the named executive officers) and non-employee directors who are eligible to receive awards under one or more of the programs.

For stock-based programs under the 2007 MIP, the Committee may grant participants shares of the Companys Common Stock, restricted stock, share units, stock options, stock appreciation rights, performance units and/or performance bonuses. In granting these awards, the Committee may establish any conditions or restrictions it deems appropriate. In addition, pursuant to the Restricted Stock Program, the Chief Executive Officer has discretionary authority to grant restricted shares or share units to certain high-performing executives. Awards of restricted stock or units vest between two and five years after the date of the grant. Awards of restricted stock or units to insiders subject to Section 16(b) of the Securities Act of 1933 require the approval of the Committee. Currently, no named executive officer owns any shares or units of restricted stock granted under the Restricted Stock Program.

All awards of stock options under the aforementioned programs are made at or above the market price at the time of the award. Annual awards of stock options to executives are made at the Committees regularly scheduled meeting in May while annual awards of stock pursuant to the Long-Term Stock Grant Program and the Stock Award Program are made at the Committees regularly scheduled meeting in February. Newly hired or promoted executives, other than executive officers, receive their award of stock options on the first business day of the month following their hire or promotion. Grants of stock options to newly hired executive officers who are eligible to receive them are made at the next regularly scheduled Committee meeting on or following their hire date.

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Ownership Guidelines

To directly align the interests of executive officers with the interests of the stockholders, the Committee requires that each named executive officer maintain a minimum ownership interest in the Company. The amount required to be retained varies depending upon the executives position. The Executive Chairman and the Chief Executive Officer are each required to own and retain a minimum number of shares or share units totaling in value five times his base salary while all other actively employed named executive officers are required to own and retain a minimum number of shares or share units totaling in value no less than three times his base salary. If these minimum ownership guidelines are not acquired and maintained within five years, the named executive officer will be precluded from subsequent sales and transfers of shares and options awarded to the executive pursuant to the Long Term Stock Grant Program and the Stock Option Program.

Executive Incentive Compensation Program

The Executive Incentive Compensation Program (the EICP) is an annual cash incentive program under the management incentive plans. The EICP provides guidelines for the calculation of annual non-equity incentive based compensation, subject to Committee oversight and modification. At its October meeting each year, the Committee considers whether an EICP should be established for the succeeding year and, if so, approves the group of employees eligible to participate in the EICP for that year. The EICP includes various incentive levels based on the participants accountability and impact on Company operations, with target award opportunities that are established as a percentage of base salary. These targets range from 60% of base salary to 110% of base salary for the Companys named executive officers.

For fiscal 2006, 75% of a named executive officers EICP award was based upon achievement of corporate financial objectives relating to earnings per share, unit volume and a combined measure of return on invested capital and sales growth, with each component accounting for 50%, 25% and 25%, respectively, of the total corporate financial objective portion of the EICP award. The remaining 25% of an executives EICP award was based upon individual performance as measured by the Companys Leadership Behavior Assessment. The Leadership Behavior Assessment reviews how well the individual has displayed the Companys four High Performance Principals which are:

In February of each year, the Committee sets minimum, target and maximum levels for each component of the corporate financial objective portion of the EICP. Payment of awards under the EICP are based upon the achievement of such objectives for the current year. Named executive officers participating in the EICP receive:

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exceeds the target performance level but does not attain the maximum performance level; and

Upon completion of the fiscal year, the Committee assesses the performance of the Company for each corporate financial objective of the EICP comparing the actual fiscal year results to the pre-determined minimum, target and maximum levels for each objective and an overall percentage amount for the corporate financial objectives is calculated.

Generally, the Committee sets the target level for earnings per share at or slightly below the Companys long-term earnings objective of between 9% and 11% as the Committee believes the long-term objective reflects strong performance. Minimum and maximum earnings per share objectives are set somewhat below or above the target level generally three to five percentage points as applicable. In making the annual determination of the minimum, target and maximum levels, the Committee may consider the specific circumstances facing the Company during the coming year. Volume, sales and return on invested capital targets are set in alignment with the Companys strategic plan and expectations regarding earnings per share and Company performance.

Over the past five years, the Company has achieved performance in excess of the target level five times but has not achieved the maximum performance level. The payout percentage over the past five years has been between approximately 120% and 150% of the participants target award opportunity with an average approximate payout percentage over the past five years of 135% of the target award opportunity. Generally, the Committee sets the minimum, target and maximum levels such that the relative difficulty of achieving the target level is consistent from year to year.

Each of the named executive officers for the fiscal year ended December 31, 2005, received the following payments in February 2006 under the EICP for fiscal 2005 performance.

Awards made to named executive officers under the EICP for performance in 2006 are reflected in column (g) of the Summary Compensation Table on page 24.

Long-Term Incentive Compensation

Long-Term Stock Grant Program

The Long-Term Stock Grant Program encourages participants to focus on long-term Company performance and provides an opportunity for executive officers and certain designated key employees to increase their stake in the Company through grants of the Companys Common Stock based on a five-year performance cycle. When allocating long-term incentives, the Committee currently targets 70% of the total value to be comprised of stock options with the remaining 30% in the form of long-term stock grants. By using a mix of stock options and long-term stock grants, the Company is able to compensate executives for sustained increases in the Companys stock performance, through the stock option program, as well as long-term growth in excess of its peer group for the relevant cycle, through the Long-Term Stock Grant Program. Both programs, however, deliver value only when the value of the Companys stock increases.

The Long-Term Stock Grant Program was redesigned beginning with the 2005-2009 performance cycle to focus more closely on the Companys performance relative to the performance

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of the Compensation Peer Group companies which are publicly-traded on a U.S. stock exchange and to better correlate the program with actual stockholder value created during each performance cycle. For awards prior to the 2005-2009 cycle:

Performance for the 2005-2009 grant cycle and subsequent cycles, is measured against the performance of the Compensation Peer Group companies that are publicly-traded on a U.S. stock exchange as opposed to the S&P 500 Packaged Food and Meats Group Index, with actual awards ranging from between 25% and 200% of the target number of shares allocated to each individual, depending upon Company performance. Under the redesigned system, awards are earned at the target level if the Companys total stockholder return is at the 60th percentile of the Compensation Peer Group. In addition, annualized total stockholder return must be positive and at least at the 40th percentile of the Compensation Peer Group to generate a threshold payout of 25% of the target number of shares allocated to each individual. If the annualized total stockholder return is below the 40^th percentile of the Compensation Peer Group or is negative, regardless of the percentile rank, then no participant will receive an award under the Long-Term Stock Grant Program for that period.

Payouts under the Long-Term Stock Grant and Stock Award Programs are determined for the most recently completed year at the Committees regularly scheduled February meeting and are reflected in the Summary Compensation Table on page 24 and the Grants of Plan Based Awards Table on page 28.

Stock Option Program

The Stock Option Program assists the Company to:

Stock option award levels are determined based on market data, vary among participants based on their positions within the Company and are granted at the Committees regularly scheduled May meeting. Newly hired or promoted executives, other than executive officers, receive their award of stock options on the first business day of the month following their hire or promotion. Newly hired executive officers who are eligible to receive options are awarded such options at the next regularly scheduled Committee meeting on or following their hire date.

Options are awarded at the New York Stock Exchanges closing price of the Companys Common Stock on the date of the grant. In certain limited circumstances, the Committee may grant options to an executive at an exercise price in excess of the closing price of the Companys Common Stock on the grant date. The Committee has never granted options with an exercise price that is less than the closing price of the Companys Common Stock on the grant date, nor has it granted options which are priced on a date other than the grant date. In 2006, upon Mr. Perezs hire as the Companys President and Chief Executive Officer, the Committee awarded options to purchase 250,000 shares of the Companys Common Stock to Mr. Perez with an exercise price in excess of the fair market value on the date of the grant. These premium-priced options were awarded in lieu of participation in certain prior long-term stock grant cycles.

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The majority of the options granted by the Committee vest at a rate of 25% per year over the first four years of the ten-year option term. Vesting and exercise rights cease upon termination of employment, except in the case of death (subject to a one year limitation), disability or retirement. Prior to the exercise of an option, the holder has no rights as a stockholder with respect to the shares subject to such option, including voting rights and the right to receive dividends or dividend equivalents.

Retirement and Other Benefits

All employees in the United States are eligible to participate in the Retirement Plan and the Savings Plan. In addition, named executive officers are entitled to participate in the Stock Award Program.

Retirement Plans

Under the Retirement Plan, full or part-time associates working for the Company in the United States or Puerto Rico who have completed five continuous years of employment with the Company, including the named executive officers, earn the right to receive certain benefits upon retirement at the normal retirement age of 65 or upon early retirement on or after age 55. Retirement benefits are calculated as the product of 1.5% times the years of service multiplied by the final average eligible pay for the three highest consecutive years in the last ten years before retirement (eligible remuneration), less the product of 1% of the annual primary Social Security benefit multiplied by the years of credited service since January 1, 1976. The formula below provides an illustration as to how the retirement benefits are calculated.

If the associate retires between the ages of 55 and 64, the amount of benefits is reduced such that if the associate retires at age 55, he or she will be entitled to 59% of the accrued benefits. Except as noted under the heading Potential Payments Upon Termination or Change-of-Control on page 33, it is not possible for a participants credited years of service under the Retirement Plan to exceed the participants actual years of service with the Company. Of the named executive officers, Mr. Hempstead and Dr. Kumar are eligible for early retirement benefits under the Retirement Plan and Mr. Splithoff was eligible for early retirement at the time of his retirement.

To the extent that an executive officers, including any named executive officers, annual retirement income benefit under the plan exceeds the limitations imposed by the Internal Revenue Code (including, among others, the limitation on the amount of annual compensation for purposes of calculating eligible remuneration for a participant under a qualified retirement plan ($220,000 in 2006)), such excess benefits may be paid from the Companys nonqualified, unfunded, noncontributory Supplemental Retirement Plan. Prior to the February 6, 2007, meeting of the Committee, benefits were not earned under the Supplemental Retirement Plan until the individual reached age 55 and had five continuous years of service with the Company. At its February 6, 2007 meeting, the Committee revised the Supplemental Retirement Plan to follow the same vesting schedule as the Retirement Plan by deleting the age requirement. As revised, benefits under the plan are earned once the individual has completed five continuous years of service with the Company. The formula used to calculate the benefit payable pursuant to the Supplemental Retirement Plan is the same as that which is used under the Retirement Plan described above.

Savings Plan

The Savings Plan is a tax-qualified retirement savings plan pursuant to which all U.S. based associates, including the named executive officers, are able to contribute the lesser of up to 25% of their annual salary or the limit prescribed by the Internal Revenue Service to the Savings Plan on a before-tax basis. The Company will match 100% of the first 3% of pay that is contributed to the Savings Plan and 60% of the next 3% of pay contributed. All contributions to the Savings Plan as well as any matching contributions are fully-vested upon contribution.

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In addition to the Savings Plan, named executive officers and certain other eligible executives can participate in the Savings Restoration Plan, which is a nonqualified retirement savings plan. Pursuant to the Savings Restoration Plan, a participant can contribute between 1% and 25% of his or her base salary to the Savings Restoration Plan on a before-tax basis. Any amounts in excess of the maximum annual before-tax contribution for qualified retirement plans allowed by the Internal Revenue Service will be deposited in the Savings Restoration Plan. As with the Savings Plan, the Company will match 100% of the first 3% of pay that is contributed to the Savings Restoration Plan and 60% of the next 3% of pay contributed.

Stock Award Program

The Company provides stock awards to select EICP participants under the management incentive plan, including the named executive officers, whose annual non-equity incentive compensation represents a significant portion of their total annual compensation. The transferability of stock awards is restricted until the executives retirement or the termination of the executives employment with the Company as they are intended to supplement benefits received under the Companys Retirement Plan and Supplemental Retirement Plan (which cover only base salary) to provide a competitive level of retirement benefits based on an executives total cash compensation. Under the Stock Award Program, participants may be awarded a number of shares of the Companys Common Stock comparable in value to the present value of 1.5% of the participants average EICP award received in the prior three years multiplied by such participants years of service, and reduced by the present value of prior awards under this program, as shown in the following formula.

Participants who receive shares under the Stock Award Program may elect to receive or reinvest dividends paid on the shares awarded, with the shares being retained in the Companys custody and subject to restrictions on sale or transfer until after termination of employment. Alternatively, participants may elect to defer all or any portion of this benefit in the form of share units with restricted transferability.

Executive Compensation Deferral Program

The named executive officers, in addition to certain other U.S.-based eligible executives, are entitled to participate in the Executive Compensation Deferral Program. Pursuant to the Executive Compensation Deferral Program, eligible employees can defer up to 100% of earnings from EICP awards, the Long-Term Stock Grant Program and the Stock Award Program and may defer up to 25% of salary (including amounts deferred pursuant to the Savings Plan) in excess of the limits prescribed by the Internal Revenue Service, in the Savings Restoration Plan. The Executive Compensation Deferral Program is discussed in further detail under the heading Nonqualified Deferred Compensation on page 32.

Perquisites and Other Personal Benefits

The Company provides named executive officers with perquisites and other personal benefits that the Company and the Committee believe are reasonable and consistent with its overall compensation program to better enable the Company to attract and retain superior employees for key positions. The Committee periodically reviews the levels of perquisites and other personal benefits provided to named executive officers.

The named executive officers are provided use of company automobiles, financial planning assistance, participation in the plans and programs described above and the use of administrative assistant services for personal matters. In addition, the Executive Chairman of the Company, for security purposes, is required to use corporate aircraft for all personal and business-related air travel

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and is provided with security and driver services by the Company. Upon relocation, key executive officers may receive, at the discretion of the Benefits Committee, which is a committee comprised of senior-level employees of the Company, a $75,000 relocation allowance which is paid in five equal annual installments.

Each named executive officer and certain other members of senior management designated by the Benefits Committee are entitled to receive a cash payment upon such executives death through the Senior Executive Death Benefit Program. In the event of the executives death after the executives retirement, his or her designated beneficiaries would be entitled to receive a net benefit of $150,000 after taking into account federal and state taxes payable by the beneficiary. In the event of the executives death prior to actual retirement at age 65, the executives designated beneficiaries would be entitled to receive $10,000 per year which is paid in monthly installments from the date of the executives death through the month in which such executive would have attained age 80. If the executives employment with the Company continues after age 65, upon the executives death, the executives designated beneficiaries would be entitled to receive the $10,000 per year salary continuation for the greater of fifteen years or until the executive would have attained age 80. The executive forfeits all benefits under the Senior Executive Death Benefit Program if he or she voluntarily terminates his or her employment with the Company prior to retirement at age 65 or if the executives employment with the Company is terminated by the Company for cause. However, benefits under the program may be paid to an eligible executive whose employment is terminated as a result of a disability or for any other reason, other than termination for cause, prior to such executive attaining age 65.

Attributed costs of the personal benefits described above for the named executive officers for the fiscal year ended December 31, 2006, are included in column (i) of the Summary Compensation Table on page 24.

The Company has entered into Change of Control Severance Agreements with certain key employees, including the named executive officers. The Change of Control Severance Agreements are designed to promote stability and continuity of senior management. Information regarding applicable payments under such agreements for the named executive officers is provided under the heading Payments Made Upon a Change of Control on page 33.

Tax and Accounting Implications

Deductibility of Executive Compensation

As part of its role, the Committee reviews and considers the deductibility of executive compensation under Section 162(m) of the Internal Revenue Code, which provides that the Company may not deduct compensation of more than $1,000,000 that is paid to certain individuals. The Company believes that compensation paid under the management incentive plans are generally fully deductible for federal income tax purposes. However, in certain situations, the Committee may approve compensation that will not meet these requirements in order to ensure competitive levels of total compensation for its executive officers. In this regard, for fiscal 2006, the amount of base salary in excess of $1,000,000 for any named executive officer was not deductible for federal income tax purposes.

Nonqualified Deferred Compensation

On October 22, 2004, the American Jobs Creation Act of 2004 was signed into law, changing the tax rules applicable to nonqualified deferred compensation arrangements. While the final regulations have not become effective yet, the Company believes it is operating in good faith compliance with the statutory provisions which were effective January 1, 2005. A more detailed discussion of the Companys nonqualified deferred compensation arrangements is provided on page 32 under the heading Nonqualified Deferred Compensation.

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Accounting for Stock-Based Compensation

Beginning on January 1, 2006, the Company began accounting for stock-based payments including its Stock Option Program, Long-Term Stock Grant Program, Restricted Stock Program and Stock Award Program in accordance with the requirements of FASB Statement 123(R).

COMPENSATION COMMITTEE REPORT

The Compensation Committee of the Company has reviewed and discussed the Compensation Discussion and Analysis required by Item 402(b) of Regulation S-K with management and, based on such review and discussions, the Compensation Committee recommended to the Board that the Compensation Discussion and Analysis be included in this Proxy Statement.

THE COMPENSATION COMMITTEE

Thomas A. Knowlton, Chairman

Howard B. Bernick

John Rau

Steven B. Sample

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SUMMARY COMPENSATION TABLE

The table below summarizes the total compensation paid or earned by each of the named executive officers for the fiscal year ended December 31, 2006. The Company has not entered into any employment agreements with any of the named executive officers. When setting total compensation for each of the named executive officers, the Committee reviews tally sheets which show the executives current compensation, including equity and non-equity based compensation.

The named executive officers were not entitled to receive payments which would be characterized as Bonus payments for the fiscal year ended December 31, 2006. Amounts listed under column (g), Non-Equity Incentive Plan Compensation, were determined by the Committee at its February 5, 2007, meeting and, to the extent not deferred by the executive, were paid out shortly thereafter.

Based on the fair value of equity awards granted to named executive officers in 2006 and the base salary of the named executive officers, Salary accounted for approximately 25% of the total compensation of the named executive officers, incentive compensation accounted for approximately 60% of the total compensation of the named executive officers and benefits accounted for approximately 15% of the total compensation of named executive officers. Because the table below reflects less than the full fiscal year salary for individuals who were not employed by the Company for the full fiscal year, and because the value of certain equity awards included below is based on the FAS 123(R) value rather than the fair value, these percentages cannot be derived using the amounts reflected in the table below.

Mr. Waters and Mr. Splithoff retired in 2006 and the amounts listed below in column (i) include amounts paid pursuant to severance arrangements between the Company and each of Messrs. Waters and Splithoff.

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(2) The amounts in column (f) reflect the dollar amount recognized for financial statement reporting purposes for the fiscal year ended December 31, 2006, in accordance with FAS 123(R) of awards pursuant to the Stock Option Program and thus include amounts from awards granted in and prior to 2006. Assumptions used in the calculation of this amount for fiscal years ended December 31, 2004, 2005 and 2006 are included in footnote 12 to the Companys audited financial statements for the fiscal year ended December 31, 2006, included in the Companys Annual Report on Form 10-K filed with the Securities and Exchange Commission on or around February 13, 2007. Assumptions used in the calculation of this amount for the fiscal year ended December 31, 2003, are included under the heading Stock-Based Compensation Plans in the Accounting Policies and Notes to Consolidated Financial Statements included in the Annual Report on Form 10-K for the fiscal year ended December 31, 2005, filed with the Securities and Exchange Commission on February 16, 2006.

(3) The amounts in column (g) reflect the cash awards to the named individuals under the EICP, which is discussed in further detail on page 17 under the heading Executive Incentive Compensation Program.

(4) The amounts in column (h) reflect the actuarial increase in the present value of the named executive officers benefits under all pension plans established by the Company determined using interest rate and mortality rate assumptions consistent with those used in the Companys financial statements and includes amounts which the named executive officer may not currently be entitled to receive because such amounts are not vested.

(5) The amount shown in column (i) reflects for each named executive officer:
 

The amount attributable to each such perquisite or benefit for each named executive officer does not exceed the greater of $25,000 or 10% of the total amount of perquisites received by such named executive officer.

(7) Mr. Wrigley, Jr. served as the Companys President, Chief Executive Officer and Chairman of the Board until October 20, 2006, at which time he became the Executive Chairman and remained the Chairman of the Board. The amount shown in column (c) is the salary paid to Mr. Wrigley, Jr. as President and Chief Executive Officer until such time and salary paid to Mr. Wrigley, Jr. in his capacity as Executive Chairman after such time.

(8) In addition to the items noted in footnote (5) above, the amount in column (i) reflects:

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The aggregate incremental cost of Mr. Wrigley, Jr.s personal use of the corporate aircraft is determined on a per flight basis and includes the cost of actual fuel used, the cost of on-board catering, the hourly cost of aircraft maintenance for the applicable number of flight hours, landing fees, trip related hangar and parking costs, universal weather monitoring costs, if applicable, crew expenses and other variable costs specifically incurred. The amount attributable to each such perquisite or benefit, other than use of the corporate aircraft, does not exceed the greater of $25,000 or 10% of the total amount of perquisites for Mr. Wrigley, Jr.

(10) Mr. Perez has elected to defer the receipt of the amount reflected in column (g).

(11) In addition to the items noted in footnote (5) above, the amount shown in column (i) reflects a relocation allowance paid by the Company to Mr. Perez. Such amount does not exceed the greater of $25,000 or 10% of the total perquisites for Mr. Perez.

(12) Mr. Gamoran has elected to defer the receipt of the amount reflected in column (g).

(13) In addition to the items noted in footnote (5) above, the amount shown in column (i) includes the amount received by Mr. Gamoran in lieu of the use of a Company-provided automobile. Such amount does not exceed the greater of $25,000 or 10% of the total perquisites for Mr. Gamoran.

(14) In addition to the items noted in footnote (5) above, the amount shown in column (i) reflects an aggregate incremental cost to the Company attributable to personal use of a Company-provided automobile, the cost of financial planning services incurred by Mr. Hempstead and reimbursed by the Company and the amount of social security taxes paid by the Company on Mr. Hempsteads accrued benefit under the nonqualified Supplemental Retirement Plan. Each such amount does not exceed the greater of $25,000 or 10% of the total perquisites for Mr. Hempstead.

(15) In addition to the items noted in footnote (5) above, the amount shown in column (i) reflects an aggregate cost to the Company attributable to personal use of a Company-provided automobile.

(16) In addition to the items noted in footnote (5) above, the amount shown in column (i) reflects an aggregate cost to the Company attributable to personal use of a Company-provided automobile, an annual housing allowance of $72,000, the cost of financial planning services incurred by Dr. Kumar and reimbursed by the Company and the amount of social security taxes paid by the Company on Dr. Kumars accrued benefit under the nonqualified Supplemental Retirement Plan. Each such amount does not exceed the greater of $25,000 or 10% of the total perquisites for Dr. Kumar.

(17) Mr. Waters retired as of April 11, 2006. If Mr. Waters remained employed by the Company as of December 31, 2006, he would have been considered a named executive officer of the Company.

(18) In connection with Mr. Waters retirement, he: (A) received on November 1, 2006, a lump sum payment of $430,000 representing six months salary; (B) is entitled to receive monthly installment payments of approximately $71,665 from November 1, 2006 through July 31, 2007; and (C) is entitled to receive a one-time severance payment of $1,089,333. However, if, as of April 30, 2007, Mr. Waters has obtained a similar position with another employer, Mr. Waters will not receive the monthly installment payments for the period of May 2007 through July 2007 and Mr. Waters one-time severance payment will be reduced by $172,023. Pursuant to his severance agreement, Mr. Waters will be entitled to a final stock award around February 2007 reflecting service through his severance period in addition to 3,000 shares. Mr. Waters Voluntary Separation Agreement was filed as Exhibit 10(u) to the Companys Quarterly Report on Form 10-Q for the period ended March 31, 2006. In addition to these items and the items noted in footnote (5) above, the amount in column (i) also includes a cost to the Company attributable to personal use of a Company-provided automobile and the cost of financial planning services incurred by Mr. Waters and reimbursed by the Company.

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(20) In connection with Mr. Splithoffs retirement, he: (A) received on January 1, 2007, a lump sump payment of $215,000, representing six-months salary; (B) is entitled to receive monthly installment payments of $26,875 from January 1, 2007 through September 1, 2007; and (C) is entitled to receive a one-time severance payment of $357,000. Pursuant to his severance agreement, Mr. Splithoff will be entitled to a final stock award around February 2007 reflecting service through his severance period. Mr. Splithoffs Voluntary Separation Agreement was filed as Exhibit 99.1 to the Current Report on Form 8-K filed on July 18, 2006. In addition to these items and the items noted in footnote (5) above, the amount in column (i) also includes a cost to the Company attributable to personal use of a Company-provided automobile and the amount of social security taxes paid by the Company on Mr. Splithoffs accrued benefit under the nonqualified Supplemental Retirement Plan.

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GRANTS OF PLAN BASED AWARDS

(2) The amounts shown in column (f) reflect the Long-Term Stock Grant minimum which is 25% of the target amount shown in column (g). The amount shown in column (h) is 200% of such target amount.

(3) The amounts shown in column (i) reflect the number of shares of stock granted to each named executive officer pursuant to the Stock Award Program.

(4) Upon his employment with the Company, Mr. Perez received options to purchase 300,000 shares of the Common Stock of the Company with a grant price equal to $46.83, which was the closing price of the Companys Common Stock on the New York Stock Exchange on the grant date.

(5) Upon his employment with the Company, Mr. Perez received premium-priced options to purchase 250,000 shares of the Common Stock of the Company with a grant price of $62.28, which was 133% of the closing price of the Companys Common Stock on the New York Stock Exchange on the grant date.

(6) Because the named executive officer is no longer actively employed by the Company, the final amount of such award will be prorated to reflect the amount of time such individual was included on the Companys payroll.

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OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END