LongView Funds Shareholder Proposals: Year-End Final Report

June 30, 2001

This report summarizes activities for the year ending June 30, 2001. Where shown, vote percentages reflect the percent of yes-and-no votes only and exclude abstentions.

Executive compensation. The LongView Funds offered various proposals at companies where compensation for executives appeared to be excessive compared to the performance of those companies or where compensation in the form of golden parachutes or similar agreements seemed excessive. Most compensation proposals are supported by 25% and 40% of the shares voted. Most LongView proposals fell within this range, with the exception of a golden parachutes proposal at Sierra Health Services, a SmallCap 600 company that had been performing poorly, where the LongView resolution obtained over 43% of the vote.

Sierra Health Bank of America Spring(FON) Covanta CSX Conseco

43.3% (shareholder approval for golden parachutes) 34.6% (greater performance-based compensation) 34.3% (greater performance-based compensation) 33.9% (shareholder approval for golden parachutes) 29.8% (shareholder approval for golden parachutes) 11.6% (report on dilution policy involving senior executives)

A proposal at McKesson HBOC regarding performance-based compensation will be voted at the company's annual meeting in July 2001.

A proposed bylaw requiring shareholder approval for any repricing or replacement of stock options was withdrawn after successful negotiations at Lone Star Steakhouse & Saloon, based on a decision of the board of directors to adopt a resolution requiring such approval with respect to directors and officers of the corporation.

A similar (though non-binding) was offered at Earthgrains and withdrawn after the company advised that such a policy was already in effect (albeit undisclosed). Earthgrains agreed to disclose the existence of that policy in its proxy materials.

Board independence and structure. The only majority vote this year came on a proposal for board declassification. In addition there was a strong (but not majority) support for confidential voting at another company, as well as a vote to separate the chairman and CEO positions at approximately the normal level of support.

Cooper Tire Huffy Union Pacific

53.5% (board declassification) 43.2% (confidential voting) 21.4% (separate chairman from CEO positions)

Westpoint Stevens adopted a confidential voting policy in response to a LongView resolution. A board declassification proposal to ConAgra Foods will be voted in September.

International Labor Organization standards. The LongView Funds offered resolutions asking companies to adopt codes of conduct based on certain conventions of the International Labor Organization, including recognition of the rights of workers to engage in collective bargaining, allowing worker representatives to carry out their functions, and bans on use of child labor, slave labor and forced labor. LongView resolutions received the following "yes" votes at the following companies, with the one at Unocal being significantly higher than normal for this topic:

Unocal American Eagle PPG Industries Lands' End

23.4% 11.4% 10% 3%

Burma. The LongView Funds asked that an independent board committee prepare a report about the potential exposure of certain companies that did business in Burma, where the Yadana pipeline project was constructed under conditions where the Burmese military removed local people from their villages and forced Burmese nationals to work on the pipeline. The companies involved responded that they were involved in offshore aspects of construction using their own employees and were not aware of any such conditions. Nonetheless, the LongView proposals received higher levels of support than was the case on prior Burma proposals.

McDermott Intl. Halliburton

15.9% 10.6%