stock reverted to the company and was held in the treasury. The supply of treasury stock is now virtually exhausted, and this has prompted your Board of Directors to seek your approval of an authorization of 125, 000 shares to be used over a period of years as part of the compensation plan for executives and key employees. We believe that it is good for the company for these management people to be shareholders. Rather than advocate an option plan we have felt that it was better to permit these people to acquire shares either through purchase with company help on financing the purchase or through earning shares as part of their compensation. If the shareholders approve the 125, 000 shares requested, shares having a market value of $233, 877 (4, 867 shares) will be distributed to 44 employees as part of their 1969 bonus. Otherwise an equivalent amount will be paid in cash. These shares so distributed will be restricted in various ways. For example, they cannot be sold for two years. Starting the third year title to 20% of the shares vests in the employee and 20% a year thereafter provided the individual remains an employee in good standing. Retirement, death, or permanent disability may accelerate vesting. This particular plan, which may be altered as experience indicates, was based on a recommendation from a nationally known management consulting firm which Utah retained last year to review its compensation practices. Obviously it is designed in part to tie these people closer to the company, for our performance has not gone unnoticed by our competitors. The competition for managerial talent is always keen but never keener than it is today. This -2-