PERCENTAGE OF NO LESS THAN 0% AND NO MORE THAN 200%, WHICH
PERCENTAGE SHALL BE DETERMINED BY THE COMMITTEE BASED UPON THE EXTENT TO WHICH
THE PERFORMANCE OBJECTIVES (AS DETERMINED BELOW) ESTABLISHED FOR SUCH AWARD ARE
ACHIEVED DURING THE AWARD PERIOD.
THE METHOD FOR DETERMINING THE APPLICABLE
PERFORMANCE PERCENTAGE SHALL ALSO BE ESTABLISHED BY THE COMMITTEE.
THE "VALUE"
OF A UNIT SHALL BE DETERMINED BY MULTIPLYING $100 BY THE SUM OF (I) 100% AND
(II) THE AGGREGATE STANDARD PRE-TAX INSURANCE RETURN-ON-EQUITY OF THE COMPANY,
ANY OF ITS SUBSIDIARIES OR ANY COMBINATION THEREOF AS SET FORTH IN THE AWARD
AGREEMENT OVER THE AWARD PERIOD (OR SUCH EARLIER DATE AS REQUIRED BY THE PLAN),
AS DETERMINED IN GOOD FAITH BY THE COMMITTEE.
(C)
AT THE TIME EACH PERFORMANCE UNIT AWARD IS
GRANTED THE COMMITTEE SHALL ESTABLISH PERFORMANCE OBJECTIVES ("PERFORMANCE
OBJECTIVES") TO BE ATTAINED WITHIN THE AWARD PERIOD AS THE MEANS OF DETERMINING
THE PERFORMANCE PERCENTAGE APPLICABLE TO SUCH AWARD.
THE PERFORMANCE OBJECTIVES
SHALL BE APPROVED BY THE COMMITTEE (I) WHILE THE OUTCOME FOR THAT AWARD PERIOD
IS SUBSTANTIALLY UNCERTAIN AND (II) NO MORE THAN 90 DAYS AFTER THE COMMENCEMENT
OF THE PERFORMANCE PERIOD TO WHICH THE PERFORMANCE OBJECTIVE RELATES OR, IF LESS
THAN 90 DAYS, THE NUMBER OF DAYS WHICH IS EQUAL TO 25 PERCENT OF THE RELEVANT
PERFORMANCE PERIOD.
THE PERFORMANCE OBJECTIVES ESTABLISHED WITH RESPECT TO A
PERFORMANCE UNIT AWARDS SHALL BE SPECIFIC PERFORMANCE TARGETS ESTABLISHED BY THE
COMMITTEE WITH RESPECT TO ONE OR MORE OF THE FOLLOWING CRITERIA SELECTED BY THE
COMMITTEE: (I) CONSOLIDATED EARNINGS BEFORE OR AFTER TAXES (INCLUDING EARNINGS
BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION); (II) NET INCOME; (III)
OPERATING INCOME; (IV) EARNINGS PER SHARE; (V) BOOK VALUE PER SHARE; (VI) RETURN
ON STOCKHOLDERS' EQUITY; (VII) EXPENSE MANAGEMENT; (VIII) RETURN ON INVESTMENT;
(IX) IMPROVEMENTS IN CAPITAL STRUCTURE; (X) STOCK PRICE; (XI) COMBINED RATIO;
(XII) OPERATING RATIO; (XIII) PROFITABILITY OF AN IDENTIFIABLE BUSINESS UNIT OR
PRODUCT; (XIV) MAINTENANCE OR IMPROVEMENT OF PROFIT MARGINS; (XV) MARKET SHARE;
(XVI) REVENUES OR SALES; (XVII) COSTS; (XVIII) CASH FLOW; (XIX) WORKING CAPITAL;
(XX) RETURN ON ASSETS; (XXI) CUSTOMER SATISFACTION; (XXII) EMPLOYEE
SATISFACTION; AND (XXIII) ECONOMIC VALUE PER SHARE (COMPUTED BASED ON BOOK VALUE
PER SHARE
A-16
DETERMINED IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES ("GAAP")
ADJUSTED FOR CHANGES IN THE INTRINSIC VALUE OF ASSETS AND LIABILITIES WHOSE
VALUE DIFFERS FROM THEIR GAAP CARRYING VALUE).
THE FOREGOING CRITERIA MAY
RELATE TO THE COMPANY, ONE OR MORE OF ITS SUBSIDIARIES OR ONE OR MORE OF ITS
DIVISIONS, UNITS, PARTNERSHIPS, JOINT VENTURES OR MINORITY INVESTMENTS, PRODUCT
LINES OR PRODUCTS OR ANY COMBINATION OF THE FOREGOING, AND MAY BE APPLIED ON AN
ABSOLUTE BASIS AND/OR BE RELATIVE TO ONE OR MORE PEER GROUP COMPANIES OR
INDICES, OR ANY COMBINATION THEREOF, ALL AS THE COMMITTEE SHALL DETERMINE.
IN
ADDITION, TO THE DEGREE CONSISTENT WITH SECTION 162(M) OF THE CODE (OR ANY
SUCCESSOR SECTION THERETO), THE PERFORMANCE OBJECTIVES MAY BE CALCULATED WITHOUT
REGARD TO EXTRAORDINARY ITEMS.
(D)
THE AWARD PERIOD (THE "AWARD PERIOD") IN
RESPECT OF ANY GRANT