ST E E L C A S E  I N C.
Management's Discussion and Analysis of Financial Condition and Results of Operations

YEAR 2000

Beginning in 1994, the Company actively engaged in replacing or modifying all business software applications as well as manufacturing and other equipment with embedded technology that could fail or generate erroneous results as a result of Year 2000 date processing (“Year 2000 issues”) issues affecting Steelcase Inc. and most other companies. Prior to December 31, 1999, the Company completed the modification or replacement of all critical business applications, technical infrastructure components and manufacturing equipment, as well as contingency and business continuity planning activities for critical business processes within the Company.

As of this filing, there have been no Year 2000 issues reported or discovered that would be expected to have a material impact on the Company’s operations or future results of operations.

Costs incurred through the date of this filing specifically to address Year 2000 issues approximated $18 million. Management views the process of assessing and remediating Year 2000 issues as an on-going effort which will require continued focus, testing and verification throughout calendar year 2000. However, no material future expenditures are anticipated.