Thousands of dollars, except per-share amounts and numbers of shares

The Company has an Employee Stock Ownership Plan ("ESOP") as part of its voluntary defined contribution plan (Savings Incentive Plan) covering most domestic employees. The ESOP is intended to satisfy all or part of the Company's obligation to match 50% of employees' contributions, up to a maximum of 3% of each participant's salary. To accomplish this, in 1990, the ESOP borrowed $60,000 in a private debt offering and used the proceeds to buy the Company's ESOP convertible preferred stock. Each share of preferred stock has a guaranteed liquidation value of $59 per share and is convertible into 6.4 shares of the Company's common stock. The preferred stock pays an annual dividend of $3.835 per share, a portion of which is used by the ESOP, together with the Company's contributions, to repay the ESOP debt. Since the ESOP debt is guaranteed by the Company, it has been reflected on the consolidated balance sheet as debt with a related amount shown in the shareholders' equity section as Unearned ESOP compensation. In July 2004, the Company repaid the remaining ESOP debt in full.

    The amount of ESOP expense recognized is equal to the cost of the preferred shares allocated to plan participants and the ESOP interest expense for the year, reduced by the amount of dividends paid on the preferred stock that are utilized by the plan to service the debt.

    Selected financial data pertaining to the ESOP/Savings Incentive Plan follows:

		2004			2003			2002
Total expense of the     Savings Incentive Plan	$	2,252		$	2,626		$	2,737
Compensation expense     (included in total expense above)	$	2,137		$	2,168		$	1,863
Dividends on ESOP shares used     for debt service	$	1,592		$	2,344		$	2,553
Number of preferred shares allocated     at September 30		503,011			500,807			476,938

    The Company guarantees employees' contributions to the fixed income fund of the Savings Incentive Plan. The amount guaranteed was $127,979 at September 30, 2004.