SCHEDULE 14A
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement. [ ] Confidential, for use of the
Commission only (as permitted by
Rule 14a-6(e)(2)).
[X] Definitive proxy statement.
[ ] Definitive additional materials.
[ ] Soliciting material pursuant to Section 240.14a-12
BRUNSWICK CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if Other Than the Registrant)
Payment of filing fee (check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.
(1) Title of each class of securities to which transaction applies:
- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- --------------------------------------------------------------------------------
(5) Total fee paid:
- --------------------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
- --------------------------------------------------------------------------------
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.
(1) Amount Previously Paid:
- --------------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
- --------------------------------------------------------------------------------
(3) Filing Party:
- --------------------------------------------------------------------------------
(4) Date Filed:
- --------------------------------------------------------------------------------
[BRUNSWICK CORPORATION LOGO]
March 26, 2002
Dear Brunswick Shareholder:
You are cordially invited to attend the 2002 Annual Meeting of Brunswick
Shareholders to be held on Wednesday, May 1, 2002, at 3:00 p.m. CDT at
Brunswick's corporate offices, 1 N. Field Court, Lake Forest, Illinois.
Brunswick's offices are northwest of Chicago, Illinois, on Route 60, one-half
mile east of I-294/94 (the Tri-State Tollway).
The formal Notice of Annual Meeting and Proxy Statement accompanying this
letter describe the business to be acted on at the meeting.
It is important that your shares be represented at the meeting. Please
submit your vote according to the instructions on the enclosed proxy card as
promptly as possible in order to ensure your representation at the meeting. Even
if you have given your proxy, you may revoke it at any time prior to the meeting
and may still vote in person if you attend the meeting. Please note, however,
that if your shares are held of record by a broker, bank, or other nominee and
you wish to vote at the meeting, you will NOT be permitted to vote in person at
the meeting unless you first obtain a proxy issued in your name from the broker,
bank or other nominee.
Shares held in Brunswick's Employee Stock Ownership Plan (BESOP),
Retirement Savings Plan (BRSP) or Rewards Plan MAY NOT be voted in person at the
meeting.
Finally, please note that you have several voting options. In addition to
returning the enclosed proxy card, you may also vote either by telephone or via
the Internet at www.proxyvote.com. Please refer to the enclosed proxy card for
further instructions concerning these voting alternatives.
Thank you for your continued support of Brunswick. I look forward to seeing
you at the meeting.
Sincerely,
/s/ G. W. BUCKLEY
GEORGE W. BUCKLEY
Chairman
NOTICE OF ANNUAL MEETING
The Annual Meeting of Shareholders of Brunswick Corporation will be held at
Brunswick's corporate offices, 1 N. Field Court, Lake Forest, Illinois, on
Wednesday, May 1, 2002, at 3:00 p.m. CDT for the following purposes:
(1) To elect five (5) directors;
(2) To ratify the appointment of Ernst & Young LLP as independent
auditors; and
(3) To consider such other business as may properly come before the
meeting.
Brunswick shareholders of record at the close of business on March 4, 2002,
will be entitled to notice of and to vote at the meeting and any adjournment
thereof.
By order of the Board of Directors,
/s/ MARSCHALL I. SMITH
MARSCHALL I. SMITH
Secretary
Lake Forest, Illinois
March 26, 2002
[BRUNSWICK CORPORATION LOGO]
PROXY STATEMENT
The Board of Directors of Brunswick Corporation ("Brunswick" or the
"Company") is soliciting proxies from Brunswick's shareholders for the annual
meeting to be held at the Company's corporate offices, 1 N. Field Court, Lake
Forest, Illinois, on Wednesday, May 1, 2002, at 3:00 p.m. CDT. This proxy
statement is first being mailed to shareholders on or about March 26, 2002.
ABOUT THE MEETING
WHAT IS THE PURPOSE OF THE ANNUAL MEETING?
At the annual meeting, shareholders will act upon matters described in the
notice of meeting contained in this proxy statement, including the election of
directors and the ratification of the Board's recommendation regarding the
Company's independent auditors. In addition, members of management will report
on the Company's 2001 performance and respond to questions raised by Brunswick
shareholders.
WHO IS ENTITLED TO VOTE?
Only holders of the 88,966,349 shares of Brunswick Common Stock outstanding
as of the close of business on March 4, 2002 (the "Record Date") will be
entitled to vote at the meeting. Each holder as of the Record Date is entitled
to one vote for each share of Brunswick Common Stock he or she holds.
WHO CAN ATTEND THE MEETING?
All shareholders of record as of the Record Date, or their duly appointed
proxies, may attend the meeting. Please note that if you hold your shares in
"street name" (that is, through a broker, bank or other nominee), you will need
to bring a copy of a brokerage statement reflecting your stock ownership as of
the Record Date to gain admittance to the meeting.
WHAT CONSTITUTES A QUORUM?
A majority of the 88,966,349 shares of Brunswick Common Stock outstanding
on the Record Date must be represented, in person or by proxy, to provide a
quorum at the annual meeting. Shares represented by proxy cards either marked
"ABSTAIN" or returned without voting instructions are counted as present for
purposes of determining whether the quorum requirement is satisfied. Also, in
those instances where shares are held by brokers who are prohibited from
exercising discretionary authority for beneficial owners who have not returned a
proxy ("broker nonvotes"), those shares will be counted as present for quorum
purposes. Broker nonvotes will not be counted as votes for or against any
proposal.
HOW DO I VOTE?
Shareholders of record can vote in person, by mail or telephone or on the
Internet at www.proxyvote.com. The deadline for voting by telephone or via the
Internet is 11:59 p.m. EDT on April 30, 2002. Your shares will be voted as you
indicate. You may specify whether your shares will be voted for all, some or
none of the nominees for director and whether your shares should be voted for or
against the ratification of the Company's independent auditors.
If your shares are held of record by a broker, bank or other nominee and
you wish to vote in person at the meeting, you must first obtain a proxy issued
in your name from the institution that holds your shares.
Any proxy given by a shareholder who is also a participant in either the
Brunswick Dividend Reinvestment Plan or the Brunswick Employee Stock Investment
Plan will also govern the voting of all shares held for that shareholder's
account under those plans, unless contrary instructions are received.
CAN I CHANGE MY VOTE AFTER I RETURN MY PROXY CARD?
Yes. Even after you have submitted your proxy, you can change your vote at
any time before the proxy is exercised by: (i) voting in person by ballot at the
meeting, (ii) returning a later-dated proxy card, (iii) entering a new vote by
telephone or on the Internet, or (iv) delivering written notice of revocation to
the Company's Secretary.
HOW DO I VOTE MY SHARES IN BRUNSWICK EMPLOYEE STOCK PLANS?
If you are a participant in the Brunswick Employee Stock Ownership Plan,
Retirement Savings Plan or Rewards Plan, you will not be able to vote the shares
that you hold in those plans at the annual meeting. Instead, you are entitled to
instruct the respective plan trustee how to cast the votes related to your plan
shares. Participants in any plan may give instructions to the respective plan
trustee by mail or telephone, or on the Internet. To vote by mail, complete,
sign and date the enclosed proxy card and return it in the enclosed prepaid
envelope. To vote by telephone or on the Internet, please follow the
instructions on the enclosed proxy card. The Company's tabulator, Automatic Data
Processing, must receive your vote by 5:00 p.m. EDT on Friday, April 26, 2002.
The appropriate trustee will vote your shares as you indicate. The trustee will
vote allocated shares (except for shares acquired with tax credit contributions)
for which proxies are not received and unallocated shares in the same proportion
as it votes allocated shares for which it receives instructions.
WHO WILL COUNT THE VOTES?
The Company's tabulator, Automatic Data Processing, will count the votes.
Members of the Company's Shareholder Services department will act as inspectors
of election.
HOW WILL MY SHARES BE VOTED IF I SIGN, DATE AND RETURN MY PROXY CARD BUT DO NOT
GIVE VOTING INSTRUCTIONS?
If you sign, date and return your proxy card, your shares will be voted as
you direct. If you do not indicate how you want your shares voted, your proxy
will be voted for the election of the five director nominees and for the
ratification of Ernst & Young LLP as the Company's independent auditors for the
2002 fiscal year.
WHAT ARE THE BOARD'S RECOMMENDATIONS?
The Board recommends a vote for the election of the five director nominees
and for the ratification of Ernst & Young LLP as the Company's independent
auditors for the 2002 fiscal year. With respect to any other matter that is
properly brought before the meeting, the proxy holders will vote as recommended
by the Board or, if no recommendation is given, in their own discretion.
WHAT VOTE IS REQUIRED TO APPROVE EACH MATTER TO BE VOTED ON?
Election of Directors: Directors shall be elected by a plurality of the
votes cast at the annual meeting on the election of directors. Abstentions or
broker nonvotes will not affect the outcome. In the event any one or more of the
five director nominees is unable to serve, votes will be cast, pursuant to
authority granted by the enclosed proxy, for the person or persons that the
Board of Directors designates as alternates.
Ratification of Independent Auditors: The affirmative vote of the holders
of a majority of the shares represented in person or by proxy and entitled to
vote on the ratification of the Company's independent auditors will be required
for approval. Abstentions are the same as a vote against ratification. Broker
nonvotes will have no effect on the vote.
2
WILL MY VOTE BE KEPT CONFIDENTIAL?
Yes. As a matter of policy, shareholder proxies, ballots and tabulations
that identify individual shareholders are kept secret and are available only to
the Company's tabulator and Inspectors of Election, who are required to
acknowledge their obligation to keep your votes confidential.
WHO PAYS TO PREPARE, MAIL AND SOLICIT THE PROXIES?
The Company pays all of the costs of preparing, mailing and soliciting
proxies. The Company asks brokers, banks, voting trustees and other nominees and
fiduciaries to forward proxy materials to the beneficial owners and to obtain
authority to execute proxies, for which they are reimbursed upon request. In
addition to solicitation by mail, telephone, facsimile, telegraph, internet or
personal contact by its officers and employees, the Company has retained the
services of Georgeson Shareholder Communications Inc. to solicit proxies for a
fee of $9,900 plus expenses.
WHAT IF OTHER MATTERS COME UP DURING THE MEETING?
If any matters other than those referred to in the Notice of Annual Meeting
should properly come before the meeting, it is the intention of the persons
named in the accompanying form of proxy to vote the proxies held by them in
accordance with their best judgment. Management does not know of any business
other than that referred to in the Notice that may be considered at the meeting.
PROPOSAL NO. 1: ELECTION OF DIRECTORS
Brunswick's Restated Certificate of Incorporation provides that the Board
of Directors shall be divided into three classes, each consisting, as nearly as
may be possible, of one-third of the total number of directors. The Board is
currently comprised of 13 directors. Five directors are to be elected at the
meeting. The Board of Directors has nominated Dorrit J. Bern, Peter Harf, Jay W.
Lorsch, Bettye Martin Musham and Ralph C. Stayer for election as directors to
serve for terms expiring at the 2005 annual meeting or until their respective
successors shall have been elected and qualified. Ms. Bern, Mr. Harf, Mr. Lorsch
and Ms. Martin Musham have served as directors since 2000, 1996, 1983 and 1993,
respectively. Mr. Stayer has not previously served on the Board, and his
election will increase the number of directors to 14, the maximum permitted
under Brunswick's By-laws.
One vacancy on the Board of Directors was filled during 2001-2002 in
accordance with Brunswick's Restated Certificate of Incorporation, which
provides that a majority of the incumbent directors may elect a director to fill
vacancies on the Board. Graham H. Phillips was elected to the Board by the
incumbent directors in February 2002 and will serve for a term expiring at the
2004 annual meeting.
It is intended that votes will be cast, pursuant to authority granted by
the enclosed proxy card (including electronic or telephonic voting), for the
election of the nominees named above as the Company's directors, except as
otherwise specified. Directors shall be elected by a plurality of the votes cast
at the annual meeting on the election of directors, and votes withheld or broker
nonvotes will not affect the outcome. In the event any one or more of such
nominees shall be unable to serve, votes will be cast, pursuant to authority
granted by the enclosed proxy, for such person or persons as may be designated
by the Board of Directors. Biographical information follows for each person
nominated and each person whose term of office will continue after the annual
meeting.
3
NOMINEES FOR ELECTION FOR TERMS EXPIRING AT THE 2005 ANNUAL MEETING:
[BERN PHOTO] DORRIT J. BERN Director
since 2000
Chairman of the Board, President and Chief Executive Officer
of Charming Shoppes, Inc., a company operating a chain of
women's specialty apparel stores, since 1997; Vice Chairman
of the Board, President and Chief Executive Officer of
Charming Shoppes, Inc., 1995 to 1997; director of The
Southern Company; age 51
[HARF PHOTO] PETER HARF Director
since 1996
Chairman and Chief Executive Officer of Joh. A. Benckiser,
GmbH, a financial holdings company, since 1988; Chairman of
the Board of Coty Inc., Benckiser's U.S.-based international
cosmetics business, since 1993; Chief Executive Officer of
Coty Inc. from 1993 to 2001; age 55
[LORSCH PHOTO] JAY W. LORSCH Director
since 1983
Louis E. Kirstein Professor of Human Relations since 1978
and Chairman of Doctoral Programs, 1995 to 1999, Harvard
University Graduate School of Business Administration; age
69
[MUSHAM PHOTO] BETTYE MARTIN MUSHAM Director
since 1993
Chairwoman of the Board and Chief Executive Officer of Gear
Holdings, Inc., a design, marketing and communications firm,
since 1999; President and Chief Executive Officer of Gear
Holdings, Inc., 1977 to 1999; director of Footstar, Inc. and
Wallace Computer Services, Inc.; age 69
[STAYER PHOTO] RALPH C. STAYER New
Nominee
Chairman of the Board, President and Chief Executive Officer
of Johnsonville Sausage LLC since 1968; age 59
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE NOMINEES NAMED ABOVE.
4
DIRECTORS CONTINUING IN OFFICE UNTIL THE 2004 ANNUAL MEETING:
[ARCHIBALD PHOTO] NOLAN D. ARCHIBALD Director
since 1995
Chairman of the Board, President and Chief Executive Officer
of The Black & Decker Corporation, a consumer and commercial
products company, since 1986; age 58
[BLEUSTEIN PHOTO] JEFFREY L. BLEUSTEIN Director
since 1997
Chairman of the Board of Harley-Davidson, Inc., a motorcycle
manufacturer, since 1998; President and Chief Executive
Officer of Harley-Davidson, Inc., since 1997; President and
Chief Operating Officer of the Motorcycle Division of
Harley-Davidson, Inc., 1993 to 1997; age 62
[PHILLIPS PHOTO] GRAHAM H. PHILLIPS Director
since 2002
Retired; Chairman and Chief Executive Officer of Young &
Rubicam Advertising, 1999 to 2000; Chairman of
Burson-Marsteller, the perception management division of
Young & Rubicam, Inc., from 1997 to 1999; age 63
[RYAN PHOTO] ROBERT L. RYAN Director
since 1998
Senior Vice President and Chief Financial Officer of
Medtronic, Inc., a medical technology company, since 1993;
director of United Healthcare Corporation; age 58
DIRECTORS CONTINUING IN OFFICE UNTIL THE 2003 ANNUAL MEETING:
[BUCKLEY PHOTO] GEORGE W. BUCKLEY Director
since 2000
Chairman of the Board and Chief Executive Officer of
Brunswick since 2000; President and Chief Operating Officer
of Brunswick, May to June 2000; Executive Vice President of
Brunswick, February to May 2000; President -- Mercury Marine
Group, 1997 to 2000; Senior Vice President of Brunswick,
1998 to 2000; Vice President of Brunswick, 1997 to 1998;
director of Giddings & Lewis LLC and Pandrol Limited (United
Kingdom); age 55
[CALLAHAN PHOTO] MICHAEL J. CALLAHAN Director
since 1991
Financial consultant; Executive Vice President and Chief
Financial Officer of FMC Corporation, a producer of
chemicals and machinery for industry and agriculture, 1994
to 1999; Executive Vice President and Chief Financial
Officer of Whirlpool Corporation, a manufacturer of major
home appliances, 1992 to 1994; director of Material Sciences
Corporation; age 63
5
[FERNANDEZ PHOTO] MANUEL A. FERNANDEZ Director
since 1997
Chairman Emeritus of Gartner Group, Inc., an information
technology company, since 2001; Chairman of Gartner Group,
Inc., 1995-2001; Chief Executive Officer of Gartner Group,
Inc., 1995 to 1998; President and Chief Executive Officer of
Gartner Group, Inc., 1991 to 1997; Managing Director -- SI
Ventures, LLC, a venture capital partnership, since 1998;
director of The Black & Decker Corporation; age 55
[HAMILTON PHOTO] PETER B. HAMILTON Director
since 2000
Vice Chairman of the Board of Brunswick and
President -- Brunswick Bowling & Billiards since 2000;
Executive Vice President and Chief Financial Officer of
Brunswick, 1998 to 2000; Senior Vice President and Chief
Financial Officer of Brunswick, 1995 to 1998; director of
The Kemper Insurance Companies; age 55
[SCHIPKE PHOTO] ROGER W. SCHIPKE Director
since 1993
Private investor; director of Legg-Mason, Inc., and The
Rouse Company; age 65
COMMITTEES AND MEETINGS
The Board of Directors met six times during 2001. All directors attended 75
percent or more of the board meetings and meetings of committees of which they
were members during 2001.
The Board of Directors has Executive, Audit and Finance, Human Resource and
Compensation, and Corporate Governance Committees. The Audit and Finance, Human
Resource and Compensation, and Corporate Governance Committees are composed
solely of independent directors.
EXECUTIVE COMMITTEE
Members of the Executive Committee are Mr. Buckley (Chairman), Mr.
Callahan, Mr. Fernandez and Mr. Schipke. The Executive Committee takes any
necessary actions requiring Board decisions between regular Board meetings when
it is impossible to convene a special meeting of the entire Board. Any action
taken by the committee will be reported to, and ratified by, the full Board at
its next regular meeting. The Executive Committee did not meet in 2001.
AUDIT AND FINANCE COMMITTEE
Members of the Audit and Finance Committee are Mr. Callahan (Chairman), Ms.
Bern, Mr. Harf and Mr. Ryan. The Board of Directors has determined that all
members of the Audit and Finance Committee are independent, in accordance with
the New York Stock Exchange audit committee requirements. Pursuant to a written
charter, the Audit and Finance Committee assists the Board in fulfilling its
responsibility to the Company's shareholders and the investment community with
respect to overseeing the Company's accounting, auditing and reporting
practices, its internal controls and the integrity of its financial information.
The committee maintains free and open communication with the Board, the
independent auditors, the internal auditors and management. The committee's
specific responsibilities include, but are not limited to:
- Reviewing the performance of the independent auditors and recommending to
the Board the appointment or discharge of the independent auditors;
- Reviewing the scope and terms of engagement of the independent auditors;
6
- Reviewing the professional qualifications of personnel of the independent
auditor and the audit firm's quality control and audit review procedures;
- Confirming and assuring the independence of the independent auditors;
- Reviewing the Company's internal audit function;
- Reviewing significant risks and exposures, audit activities, significant
audit findings and recommendations of the independent and internal
auditors, together with management's responses;
- Reviewing the adequacy and effectiveness of the Company's internal
controls;
- Reviewing the audited annual and periodic financial statements and the
independent auditors' opinion rendered with respect to the financial
statements;
- Reviewing legal, environmental and regulatory matters that may have a
material financial or disclosure impact;
- Reviewing changes in accounting standards or the Company's accounting
policies and practices that may affect the Company's financial results or
reporting practices;
- Reviewing the Annual Report on Form 10-K;
- Reviewing periodic reports on the Company's ethics program;
- Conducting or authorizing investigations into any matters within the
committee's scope of responsibilities;
- Meeting with the independent auditors and internal auditors without
members of management present;
- Reporting to the Board on its activities following each meeting of the
committee; and
- Reviewing the committee's charter annually.
The Audit and Finance Committee met five times during 2001. The committee's
charter was adopted by the Board in 2000 and amended in 2002. A copy of the
amended charter is attached to this Proxy Statement as Appendix A.
HUMAN RESOURCE AND COMPENSATION COMMITTEE
Members of the Human Resource and Compensation Committee are Mr. Schipke
(Chairman), Mr. Archibald and Mr. Lorsch. The Human Resource and Compensation
Committee's responsibilities include, but are not limited to:
- Determining compensation paid to the Company's senior executives;
- Developing policies for the administration of all compensation and
benefit plans in which other senior managers participate;
- Reviewing all executive compensation plans to satisfy the Board that
these plans will motivate achievement of corporate objectives;
- Reporting on the compensation paid to executives under the Company's
plans and its relationship to the Company's performance, as required by
the Securities and Exchange Commission;
- Approving the performance criteria for the Company's bonus plans; and
- Coordinating the Board's review of management succession plans and
activities.
The Human Resource and Compensation Committee met five times during 2001.
7
CORPORATE GOVERNANCE COMMITTEE
Members of the Corporate Governance Committee are Mr. Fernandez (Chairman),
Mr. Bleustein and Ms. Martin Musham. The Corporate Governance Committee's
responsibilities include, but are not limited to:
- Overseeing the overall functioning of the Board, including assessing the
Board's composition, agenda and calendar, the information directors
receive, director compensation, and the Board's other processes and
procedures;
- Establishing and recommending to the Board criteria for new directors to
be added to the Board and, working with the Chairman and Chief Executive
Officer, screening new potential nominees before they are recommended to
the Board;
- Overseeing the orientation of new directors to assure they are able to
make a timely contribution to the Board's work;
- Reviewing the performance of each incumbent director at the time of his
or her re-nomination and, through the committee's chairman and the
Chairman of the Board, communicating the results of this review to the
nominee on behalf of the Board;
- Coordinating an annual review of the Board's functioning and recommending
any needed changes;
- Determining the chairs and membership of Board committees, upon
recommendation from the Chairman of the Board; and
- Monitoring, on the Board's behalf, changes in the Company's
organizational structure and its corporate governance.
The Corporate Governance Committee met two times during 2001.
DIRECTOR NOMINATIONS
The By-laws provide that nominations for the election of directors may be
made by the Board of Directors or a committee appointed by the Board of
Directors. The Corporate Governance Committee has been appointed by the Board to
make such nominations and will consider qualified director candidates who are
suggested by shareholders in written submissions to the Company's Secretary. In
addition, the By-laws provide the following procedures for shareholder
nominations:
- If a shareholder intends to nominate one or more director candidates to
stand for election at an annual meeting of shareholders, the shareholder
must deliver written notice of the nomination to the Company's Secretary
not later than 90 days prior to the anniversary date of the immediately
preceding annual meeting of shareholders;
- If a shareholder intends to nominate one or more director candidates to
stand for election at a special meeting of shareholders, the shareholder
must deliver written notice of the nomination to the Company's Secretary
not later than the tenth day following the date on which notice of such
meeting is first given to shareholders.
A notice of nomination submitted by a shareholder shall set forth the
following information concerning such shareholder and the shareholder's
nominee(s):
- Their names and addresses;
- A representation that the shareholder is entitled to vote at such meeting
and intends to appear in person or by proxy at the meeting to nominate
the person or persons specified in the notice;
- A description of all arrangements or understandings between the
shareholder and each nominee and such other information as would be
required to be included in a proxy statement soliciting proxies for the
election of the nominee(s) of such shareholder; and
8
- The consent of each nominee to serve as a director of the Company if so
elected.
The chairman of the shareholders' meeting may refuse to acknowledge any
nomination not made in compliance with the foregoing procedure.
DIRECTOR COMPENSATION
During 2001, the Corporate Governance Committee conducted a review of
director compensation practices among a group of 29 peer companies which the
Company uses for compensation benchmarking purposes. Based on this review,
several changes were made to the Company's director compensation programs.
Annual Fee: Directors who are not employees are entitled to an annual fee
of $50,000. Directors who are chairpersons of the Audit and Finance, Human
Resource and Compensation, and Corporate Governance Committees are entitled to
an additional annual fee of $7,500. One-half of each director's annual fee is
paid in Brunswick Common Stock, which may be deferred until after retirement
from the Board. Each director may elect to have the remaining one-half paid as
follows:
- In cash;
- In Common Stock distributed currently;
- In deferred stock units with a 20 percent premium; or
- In stock options.
For Directors who elect to receive one-half of their annual fee in deferred
stock units, the number of units is determined by multiplying the cash amount by
1.2, then dividing that amount by the closing price of Brunswick Common Stock on
the date of grant. For Directors who elect to receive one-half of their annual
fee in stock options, the number of options is determined by multiplying the
cash amount by four, then dividing that amount by the closing price of Brunswick
Common Stock on the date of grant.
Stock Options: Non-employee directors immediately following the Company's
2001 annual meeting of shareholders each received options to purchase 3,000
shares of Brunswick Common Stock at a price of $19.125 per share, the closing
price on the date of the meeting. Beginning in 2002, each incumbent Director
immediately following the annual meeting of shareholders will receive an annual
grant of 3,000 stock options and 1,000 deferred stock units. In 2002 only, the
deferred stock-unit grant will consist of 2,000 shares.
New non-employee directors who are first elected to the Board of Directors
at or within six months after the most recent annual meeting of shareholders
receive an initial grant of 6,000 stock options and 2,000 deferred stock units.
New non-employee directors who are first elected to the Board six months or more
following the most recent annual meeting of shareholders receive 3,000 stock
options and 1,000 deferred stock units.
The exercise price of all options is the closing price of Brunswick Common
Stock on the date of grant. Those options that directors elect to receive in
lieu of taking their annual fee in cash are immediately vested and become
exercisable six months following the date of grant. One-half of the shares
awarded in all other non-employee director option grants vest and become
exercisable on each of the first and second anniversaries of the date of grant.
All non-employee director options become exercisable immediately upon a change
in control of the Company, death, disability, or retirement upon reaching the
mandatory retirement age for directors, and may be exercised at any time after
becoming exercisable until the tenth anniversary of the date of grant.
Brunswick Product Program: Directors are encouraged to use Brunswick
products to enhance their understanding and appreciation of the Company's
business. Directors may receive up to $10,000 of Brunswick products annually.
The value of the products is included in the directors' taxable income, and the
Company reimburses Directors for applicable tax liability associated with the
receipt of products. In addition, Directors may lease boats from the Company at
no charge except for the payment of applicable
9
taxes, and all or a portion of a Director's $10,000 product allowance may be
applied to defray such taxes. Directors also may purchase Brunswick products at
the Company's wholesale prices.
SHAREHOLDERS
Each director and nominee for director, each executive officer listed in
the summary compensation table, and all directors and executive officers as a
group owned the number of shares of Brunswick Common Stock set forth in the
following table, with sole voting and investment power except as otherwise
indicated:
NUMBER OF SHARES PERCENT
NAME OF INDIVIDUAL BENEFICIALLY OWNED OF
OR PERSONS IN GROUP AS OF FEBRUARY 15, 2002 CLASS
- ------------------- ----------------------- -------
Nolan D. Archibald....................................... 36,562(1) *
Dorrit J. Bern........................................... 7,045(1) *
Jeffrey L. Bleustein..................................... 26,597(1) *
George W. Buckley........................................ 299,596(2) *
Michael J. Callahan...................................... 57,995(1) *
Manuel A. Fernandez...................................... 24,337(1) *
Peter B. Hamilton........................................ 334,749(2) *
Peter Harf............................................... 52,710(1) *
Jay W. Lorsch............................................ 52,141(1) *
Bettye Martin Musham..................................... 29,933(1) *
Graham H. Phillips....................................... 0 *
Robert L. Ryan........................................... 13,135(1) *
Roger W. Schipke......................................... 44,732(1) *
Ralph C. Stayer.......................................... 6,600 *
William J. Barrington.................................... 220,335(2) *
Patrick C. Mackey........................................ 44,669(2) *
Dustan E. McCoy.......................................... 53,771(2) *
Victoria J. Reich........................................ 81,740(2) *
All directors and executive officers as a group.......... 1,767,475(1)(2) 2.00%
- ---------------
* Less than 1 percent
(1) Includes the following shares of Common Stock issuable to non-employee
directors, receipt of which has been deferred: Messrs. Archibald 8,562
shares, Bleustein 11,097 shares, Callahan 22,854 shares, Fernandez 13,837
shares, Harf 14,710 shares, Lorsch 27,458 shares, Ryan 5,635 shares and
Schipke 26,132 shares, Ms. Bern 5,545 shares, Ms. Martin Musham 8,157
shares, and all non-employee directors as a group 143,987 shares. Also
includes the following shares of Common Stock issuable pursuant to stock
options exercisable currently or within 60 days: 13,000 shares for each of
Messrs. Archibald and Harf; 18,600 shares for each of Messrs. Callahan,
Lorsch and Schipke and Ms. Martin Musham; 10,500 shares for each of Messrs.
Bleustein and Fernandez; 7,500 shares for Mr. Ryan; and 1,500 shares for Ms.
Bern.
(2) Includes the following shares of Common Stock issuable pursuant to stock
options exercisable currently or within 60 days: Messrs. Buckley 247,000
shares, Hamilton 245,750 shares, Barrington 169,000 shares, Mackey 32,500
shares, McCoy 33,750 shares and Ms. Reich 65,250 shares, and all directors
and executive officers as a group 1,180,195 shares. Includes the following
shares of Common Stock held by the Brunswick Employee Stock Ownership Plan
trustee and the Brunswick Savings Plan trustee as of December 31, 2001:
Messrs. Buckley 391 shares, Barrington 8,819 shares, and Hamilton 664
shares, Ms. Reich 450 shares, and all executive officers as a group 18,903
shares. Also
10
includes the following shares of Common Stock held for the benefit of family
and family partnerships: Mr. Hamilton 43,250 shares, Ms. Reich 40 shares,
and all executive officers as a group 43,450 shares.
Does not include the following deferred shares of Common Stock which are
held in these officers' deferred compensation accounts: Messrs. Buckley
90,838 shares, Barrington 3,246 shares, Mackey 8,611 shares, and McCoy
12,843 shares, Ms. Reich 19,675 shares, and all executive officers as a
group 212,870 shares. These officers will be entitled to receive these
deferred shares in predetermined installments which will commence at
varying times following the officers' termination of employment with the
Company, in accordance with each officer's individual election.
The only shareholder known to the Company to beneficially own more than 5
percent of Brunswick's outstanding Common Stock is:
SHARES BENEFICIALLY
NAME AND ADDRESS OF OWNED AS OF PERCENT
BENEFICIAL OWNER DECEMBER 31, 2001 OF CLASS
- ------------------- ---------------------- --------
FMR Corp.................................................... 5,066,920(1) 5.775%
82 Devonshire Street
Boston, Massachusetts 02109
- ---------------
(1) This information is based upon a Schedule 13G/A (the "Schedule 13G/A") filed
jointly by FMR Corp., Edward C. Johnson 3d and Abigail Johnson with the
Securities and Exchange Commission on February 13, 2002. As of that date,
FMR Corp. was the beneficial owner of 5,066,920 shares (5.775%) of Brunswick
Common Stock. Also as of that date, Edward C. Johnson 3d, the Chairman of
FMR Corp., owned 12% of FMR Corp.'s outstanding voting stock, and Abigail
Johnson, a director of FMR Corp., owned 24.5% of FMR Corp.'s outstanding
voting stock. Of the 5,066,920 shares reported on the Schedule 13G/A, the
following affiliates of FMR Corp. beneficially owned, as of February 13,
2002, the indicated number of shares of Brunswick Common Stock: Fidelity
Management & Research Company, 4,758,030 shares; Fidelity Management Trust
Company, 255,484 shares; and Strategic Advisers, Inc., 206 shares. The
5,066,920 shares reported on the Schedule 13G/A also include 53,200 shares
beneficially owned by Fidelity International Limited of which FMR Corp.
disclaims beneficial ownership.
REPORT OF THE HUMAN RESOURCE AND COMPENSATION COMMITTEE
The Human Resource and Compensation Committee of the Board of Directors is
comprised entirely of independent, non-employee directors. The Committee is
responsible for overseeing all compensation plans in which the Chairman and
Chief Executive Officer and other senior executives, including group and
division presidents and senior corporate executives ("Senior Executives"),
participate.
EXECUTIVE COMPENSATION PROGRAMS
Executive compensation programs are designed to:
- Attract, retain and motivate the senior executive talent required to
ensure the Company's continued success;
- Support creation of shareholder value by linking compensation to
corporate results; and
- Ensure that pay is consistent with performance.
Twenty-nine peer companies are used to assess the competitiveness of the
Company's executive compensation. The peer companies consist primarily of
manufacturers with revenues that are comparable with the Company's. Compensation
for the Company's Senior Executives and other key managers generally
approximates the fiftieth percentile among the peer companies selected for this
purpose.
Base Salaries: Base salaries and salary increases reflect an executive's
responsibilities and performance, as demonstrated over time, and will be managed
around median peer salary levels. Salary
11
ranges are used to ensure that compensation opportunities are externally
competitive and internally equitable. Generally, executive salaries are reviewed
every 12 to 24 months.
Brunswick Performance Plan (BPP): BPP rewards achievement of annual
financial goals. For 2001, BPP rewarded annual performance as measured by
Brunswick Value Added (BVA), defined as after-tax profits after a deduction for
the cost of total capital. Individual awards reflect both team performance as
measured by BVA and individual contribution to success. For Senior Executives,
BPP opportunities generally range from 75 percent to 125 percent of salary.
For corporate participants, BVA is based on overall corporate performance.
For division participants, BVA is based on division performance. BVA performance
for 2001 generally did not support the awarding of bonuses. Select divisions did
achieve BVA performance targets and were eligible for BPP awards.
Strategic Incentive Plan (SIP): SIP rewards achievement of mid-term
financial goals and performance against leading indicators of success.
Individual awards reflect both team performance and individual contribution to
success. Beginning in 2001, SIP awards are based on BVA performance and
performance against identified strategic factors. With respect to the BVA
component, SIP has overlapping two-year cycles with a new cycle beginning each
year. With respect to the strategic-factor components, SIP has two-year
"end-to-end" performance periods. For Senior Executives, SIP opportunities
generally range from 75 percent to 100 percent of salary.
Beginning in 2001, it was initially anticipated that SIP performance
periods would be lengthened from two years to three years. In addition, to
transition to the use of BVA and strategic-factor performance criteria, the
2000-2001 cycle was shortened to 2000 only. One-, two- and three-year BVA-based
cycles and a three-year strategic-factor-based cycle were initiated in 2001. Due
to the difficulty in setting three-year performance targets in the current
economy, however, the Committee recommended that the three-year BVA cycle be
discontinued, and that the three-year strategic-factor cycle be split into a
one-year cycle for 2001 and a two-year cycle for 2002-2003. The 2001-2002 BVA
criteria were reset so that one-half of the 2001-2002 BVA-based award can be
earned if 2002 performance warrants.
BVA performance for 2001 did not support funding of SIP awards for
corporate participants or for most division participants. Select divisions did
achieve BVA performance targets and were eligible for BVA-based SIP awards.
The portion of SIP based on strategic factors--customer satisfaction,
employee satisfaction, innovation and market share--did support funding of SIP
awards for both corporate and division participants. Because SIP awards for 2001
were based on a one-year performance period, they are reported as annual bonuses
in the Summary Compensation Table below.
Employee Stock Options: The Company uses employee stock options, with
exercise prices set at the closing price of Brunswick Common Stock on the date
of grant, to reward long-term success as measured by Brunswick Common Stock
price appreciation. Options generally have a ten-year term with options granted
in 2001 vesting 25 percent on each of the first, second, third and fourth
anniversaries of the date of grant. Options vest earlier if there is a change in
control of the Company, upon death or disability of the optionee, or if the
optionee's age and years of service equal 65 or more on termination of
employment.
In order to provide additional incentive, in 2001 the Committee granted
Senior Executives both their scheduled 2001 stock option awards and an
accelerated grant of their scheduled 2002 stock option awards. In recognition of
this acceleration, the Committee does not expect to grant stock options to
Senior Executives in 2002.
Stock Ownership Guidelines: The Chief Executive Officer is expected to own
Brunswick Common Stock with a minimum value of five times annual salary. Other
Senior Executives are expected to own stock with a minimum value of one to three
times base salary. Ownership requirements are expected to be met within five
years from the later of guideline adoption, attainment of senior executive
status, salary increase or promotion to a position with a higher ownership
requirement.
12
Elective Deferral Program: Senior Executives may elect to defer salary,
BPP or SIP awards. Beginning in 2001, Senior Executives electing to defer SIP
awards into deferred stock units are entitled to a 20 percent premium. For
Senior Executives making this election, the number of stock units deferred is
determined by multiplying the cash amount by 1.2, then dividing that amount by
the closing price of Brunswick Common Stock on the date of grant. If the
original deferral is withdrawn before the third anniversary of the deferral, the
20 percent premium will be forfeited.
COMPENSATION OF THE CHIEF EXECUTIVE OFFICER
For 2001, George W. Buckley's annual salary was $800,000, which closely
approximates the median salary for chief executive officers in the Company's
29-company peer group described above. Mr. Buckley's salary has not been
increased since June 2000.
Mr. Buckley participates in the Brunswick Performance Plan (BPP), the
BVA-based annual incentive plan described above. Mr. Buckley's target incentive
opportunity is 150 percent of base salary. For 2001, the Company's BVA
performance did not support the granting of a BPP award to Mr. Buckley.
Mr. Buckley participates in the Strategic Incentive Plan (SIP), the
mid-term incentive plan described above. Funding for SIP awards is based on BVA
performance and achievement of strategic objectives. Mr. Buckley's target
incentive opportunity is 100 percent of base salary. The Company's 2001 BVA
performance did not support funding of a SIP award for Mr. Buckley. In
recognition of the Company's accomplishment of strategic goals, the Committee
recommended and the Board approved a SIP award of $500,000 for Mr. Buckley.
Mr. Buckley was granted 300,000 stock options in February 2001, the maximum
then allowed any individual in a single year under the 1991 Stock Plan. In May
2001, shareholders increased the maximum annual award limit to 1 million shares
per participant, and thereafter the Board granted Mr. Buckley 425,000 additional
stock options. These stock option grants represent the following:
- The balance of options which the Committee provisionally approved for Mr.
Buckley in connection with his being named Chairman in 2000 but which
were not previously granted due to the annual limits on stock option
grants to individual participants described above;
- Annual stock options for 2001; and
- An acceleration of scheduled 2002 stock options through a one-time
accelerated award made in 2001 to provide significant up-front incentive
for Mr. Buckley and other Senior Executives.
In recognition of the acceleration of 2002 stock option awards, the
Committee does not expect to grant stock options to Mr. Buckley or other Senior
Executives in 2002. All stock options were granted with an exercise price equal
to the closing price of Brunswick Common Stock on the date of grant and a ten-
year option term, with 25 percent of the stock option shares vesting on the
first, second, third, and fourth anniversaries of the date of grant.
OMNIBUS BUDGET RECONCILIATION ACT OF 1993
The Omnibus Budget Reconciliation Act of 1993 (the "Act") places a $1
million tax deduction limit on compensation paid to any executive employed by
the Company on December 31 of each year and named in the summary compensation
table, with certain exceptions. Senior Executives will generally defer receipt
of compensation that is not deductible by the Company, under the terms of an
automatic deferral plan established for this purpose.
Submitted by Members of the Human Resource and Compensation Committee of
the Board of Directors.
R. W. Schipke, Chairman
N. D. Archibald
J. W. Lorsch
13
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN AMONG
BRUNSWICK, S&P 500 INDEX AND BRUNSWICK'S PEER GROUP
[PERFORMANCE GRAPH]
BRUNSWICK S&P 500 INDEX PEER GROUP
--------- ------------- ----------
1996 100 100 100
1997 128.63 225.76 107.03
1998 106.93 290.55 97.09
1999 98.18 347.28 100.01
2000 82.79 312.07 94.61
2001 100.84 271.37 137.93
The basis of comparison is a $100 investment at December 31, 1996, in each
of (i) Brunswick, (ii) the S&P 500 Index, and (iii) a peer group of five
recreation manufacturing companies (Cybex International, Inc., Polaris
Industries, Inc., K2, Inc., Fortune Brands, Inc., and Callaway Golf Company),
weighted by the beginning of the year market value of each company. All
dividends are reinvested.
14
SUMMARY COMPENSATION TABLE
In accordance with regulations under the Securities Exchange Act of 1934,
the following table sets forth the compensation for each of the last three years
of the Chief Executive Officer and each of the Company's five other most highly
compensated executive officers.
LONG-TERM
ANNUAL COMPENSATION COMPENSATION AWARDS PAYOUTS
--------------------------------------- ----------------------- ----------
OTHER RESTRICTED SECURITIES LONG-TERM
ANNUAL STOCK UNDERLYING INCENTIVE ALL OTHER
NAME/POSITION YEAR SALARY BONUS(4) COMPENSATION(5) AWARD(6) OPTIONS(#) PAYOUTS(7) COMPENSATION(8)
- ------------- ---- -------- ---------- --------------- ---------- ---------- ---------- ---------------
George W. Buckley(1)... 2001 $790,786 $ 500,000 $239,566 0 725,000 0 $64,125
Chairman and 2000 660,625 1,410,000 306,120 0 300,000 $550,000 41,032
Chief Executive
Officer 1999 442,548 595,600 24,536 0 40,000 338,222
Peter B. Hamilton...... 2001 $514,000 $ 102,800 $ 61,821 0 90,000 0 $73,448
Vice Chairman and 2000 502,116 766,950 43,013 $285,938 45,000 $342,733 81,941
President -- Brunswick 1999 442,548 473,280 24,687 0 40,000 252,181 79,495
Bowling and Billiards
Patrick C. Mackey(2)... 2001 $368,030 $ 173,292 $163,954 0 90,000 0 $59,921
Vice President and 2000 63,971 136,400 0 0 45,000 0 0
President -- Mercury
Marine Group
William J.
Barrington........... 2001 $434,923 $ 88,028 $ 94,537 0 50,000 0 $61,807
Vice President and 2000 458,402 726,163 76,895 0 40,000 $435,980 91,896
President--US Marine 1999 421,699 604,000 56,732 0 35,000 311,255 96,960
Division
Dustan E. McCoy(3)..... 2001 $427,308 $ 85,462 $ 7,811 0 90,000 0 $60,214
Vice President and 2000 343,694 413,800 2,123 0 45,000 $170,000 63,331
President -- Brunswick 1999 108,539 96,890 44,806 0 20,000 42,509 32,700
Boat Group
Victoria J. Reich...... 2001 $355,846 $ 101,169 $ 1,506 0 90,000 0 $18,956
Senior Vice President 2000 307,097 442,785 0 0 45,000 $136,307 13,151
and Chief Financial 1999 212,769 179,550 0 0 15,000 97,676 10,335
Officer
- ---------------
(1) On being named President and Chief Operating Officer of the Company in May
2000, Mr. Buckley's salary was increased from $470,000 to $650,000. Mr.
Buckley's salary was increased to $800,000 in June 2000 when he was named
Chairman and Chief Executive Officer. Over the 2001 Thanksgiving holiday,
all of the Company's corporate office employees were furloughed. This
resulted in the loss of three days' pay for all corporate office employees,
including Mr. Buckley.
(2) Mr. Mackey joined the Company as Vice President and President--Mercury
Marine Group in October 2000.
(3) Mr. McCoy joined the Company as Vice President, General Counsel & Corporate
Secretary on September 1, 1999, and in October 2000 was elected
President--Brunswick Boat Group.
(4) Annual bonuses for 2001 consist of amounts awarded under the 2001 Brunswick
Strategic Incentive Plan (SIP). SIP is typically based on performance over
two years with overlapping performance periods. As summarized in the Report
of the Human Resource and Compensation Committee, to transition to the use
of Brunswick Value Added as the financial performance metric, both a
one-year performance period and a two-year performance period were begun in
2001. 2001 SIP awards were based on a one-year performance period and are
reported as annual bonuses. As a result, no long-term payouts were made. No
bonus amounts were awarded for 2001 to any named executive under the
Brunswick Performance Plan (BPP).
(5) Other Annual Compensation for the named executives includes the following:
(i) for 2001: relocation expenses of $70,644 for Mr. Buckley and $44,660 for
Mr. Mackey; reimbursement for payment of taxes for Mr. Mackey of $77,928;
and payments of above-market interest on deferred compensation for Messrs.
Barrington $88,722, and Hamilton $60,740; and (ii) for 2000: relocation
expenses of
15
$95,076 and reimbursement for payment of taxes of $97,949 for Mr. Buckley;
and payments of above-market interest on deferred compensation for Messrs.
Barrington $76,220, and Hamilton $43,013.
(6) On May 4, 2000, Mr. Hamilton was awarded 15,000 restricted shares of Common
Stock with a then current value of $285,938. These shares will vest on May
4, 2003. As of December 31, 2001, the value of these shares was $326,400.
(7) Due to changes in Brunswick's Strategic Incentive Plan (SIP), which
typically is treated as long-term incentive compensation, 2001 SIP awards
are reported in the annual bonus column. See note (4) above.
(8) All Other Compensation for 2001 for the named executive officers is
comprised of the following:
- The Company's contributions to the Brunswick Retirement Savings Plan for
Messrs. Buckley $7,117, and Hamilton $4,626, and Ms. Reich $3,203;
- The Company's contributions to the Brunswick Employee Stock Ownership
Plan of $457 for each of Messrs. Buckley, Hamilton, McCoy, Mackey and
Barrington and Ms. Reich;
- The Company's contributions to the Brunswick Rewards Plan for Messrs.
McCoy $29,826, Mackey $9,602, and Barrington $37,464; and
- The value of split dollar life insurance premiums paid by the Company on
behalf of named executive officers. This value represents the cost of
term life insurance provided during the year as well as the present value
of the potential cash surrender value attributable to the year's premium
payment. The present value is determined by assuming an interest free
loan to the named executive until the Company is reimbursed for its
portion of the premiums. These amounts are: Messrs. Buckley $56,551,
Hamilton $68,365, McCoy $29,931, Mackey $49,862, and Barrington $23,886,
and Ms. Reich $15,296.
OPTION GRANTS IN 2001
INDIVIDUAL GRANTS(1)
------------------------------------------------ POTENTIAL REALIZABLE
NUMBER OF % OF TOTAL VALUE AT ASSUMED ANNUAL
SECURITIES OPTIONS RATES OF STOCK PRICE
UNDERLYING GRANTED TO APPRECIATION FOR OPTION TERM(4)
OPTIONS EMPLOYEES EXERCISE EXPIRATION -------------------------------------
EXECUTIVE GRANTED IN 2001 PRICE DATE 0% 5% 10%
- --------- ---------- ---------- -------- ---------- --- -------------- --------------
George W. Buckley........... 300,000 11.30% $19.9200 02/06/11 0 $ 3,758,274 $ 9,524,205
425,000 16.01% 20.1500 05/01/11 0 5,385,696 13,648,412
Peter B. Hamilton........... 90,000 3.39% 19.9200 02/06/11 0 1,068,335 2,707,370
Patrick C. Mackey........... 90,000 3.39% 19.9200 02/06/11 0 1,068,335 2,707,370
William J. Barrington....... 50,000 1.88% 19.9200 02/06/11 0 593,519 1,504,094
Dustan E. McCoy............. 90,000 3.39% 19.9200 02/06/11 0 1,068,335 2,707,370
Victoria J. Reich........... 90,000 3.39% 19.9200 02/06/11 0 1,068,335 2,707,370
All Employee Optionees...... 2,654,950 100% $20.0244(2) Various 0 $ 20,810,310 $ 52,737,410
All Shareholders(3)......... N/A N/A N/A N/A 0 $1,105,674,487 $2,801,996,237
Employee Optionees' Gain as
% of All Shareholders'
Gains..................... N/A N/A N/A N/A 0 1.88% 1.88%
- ---------------
(1) Non-qualified stock options awarded during 2001 were granted with an
exercise price equal to the closing price of Brunswick Common Stock on the
date of grant and a ten-year option term, with 25 percent of the stock
option shares vesting on the first, second, third and fourth anniversaries
of the date of grant. Options vest earlier if there is a change in control
of the Company, upon death or disability of the optionee, or if the
optionee's age plus years of service total 65 or more on termination of
employment. When exercising options, an option holder may deliver previously
acquired shares of Common Stock or may request that shares be withheld to
satisfy required withholding taxes. Stock
16
options are transferable only to immediate family members, estate planning
vehicles or others approved by the Human Resource and Compensation
Committee.
(2) Weighted average exercise price of all employee option shares awarded during
2001.
(3) The potential realizable values for all shareholders were calculated using
the weighted average exercise price ($20.0244) of all employee option shares
awarded during 2001 and the total outstanding shares of Common Stock on
December 31, 2001. At 5 percent and 10 percent annual appreciation, the
value of the Common Stock would be approximately $32.62 per share and $51.94
per share, respectively, at the end of the ten-year period.
(4) No gain to the optionees is possible without an increase in stock price,
which will benefit all stockholders commensurately. A zero percent stock
price appreciation will result in zero dollars for the optionee.
OPTION EXERCISES AND YEAR-END VALUE TABLE(1)
NUMBER OF SECURITIES VALUE OF UNEXERCISED,
UNDERLYING THE UNEXERCISED IN-THE-MONEY OPTIONS
OPTIONS AT 12/31/01 HELD AT 12/31/01(2)
--------------------------- ------------------------------
EXECUTIVE EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- --------- ----------- ------------- ------------- --------------
George W. Buckley...................... 172,000 978,000 $2,393,600.00 $20,672,000.00
Peter B. Hamilton...................... 223,250 151,750 1,768,000.00 2,692,800.00
Patrick C. Mackey...................... 10,000 120,000 217,600.00 2,611,200.00
William J. Barrington.................. 186,500 104,500 2,132,480.00 1,740,800.00
Dustan E. McCoy........................ 11,250 143,750 244,800.00 2,692,800.00
Victoria J. Reich...................... 42,750 134,250 462,400.00 2,692,800.00
- ---------------
(1) No options were exercised by any named executive in 2001.
(2) Represents the difference between the option exercise price and the fair
market value of Brunswick Common Stock on December 31, 2001.
LONG-TERM INCENTIVE PLAN -- AWARD DURING 2001
NUMBER OF SHARES, PERFORMANCE OR OTHER
UNITS OR OTHER PERIOD UNTIL
EXECUTIVE RIGHTS(1) MATURATION OR PAYOUT THRESHOLD TARGET MAXIMUM
- --------- ----------------- -------------------- --------- ---------- ----------
William J. Barrington.... $1,000,000 3/28/01 -- 12/31/03 n/a $1,000,000 $1,000,000
cash incentive
- ---------------
(1) One-time incentive opportunity awarded to Mr. Barrington in connection with
his transfer from the Company's Sea Ray Division, located in Knoxville,
Tennessee, to its US Marine Division in Arlington, Washington. Payout will
be based on accomplishment of defined strategic objectives and financial
performance metrics.
17
PENSION PLANS
The following table shows the maximum retirement income which may be
payable as a straight-life annuity pursuant to the Company's salaried pension
plans at age 65 under various assumed conditions prior to reduction for Social
Security benefits.
RETIREMENT INCOME FOR
AVERAGE OF THE THREE HIGHEST YEARS OF PARTICIPATING SERVICE
CONSECUTIVE YEARS' EARNINGS -----------------------------------------
AS A PARTICIPANT 15 20 25 30
- ---------------------------- ------- ------- --------- ---------
$ 500,000................................. 150,000 200,000 250,000 300,000
750,000................................ 225,000 300,000 375,000 450,000
1,000,000................................ 300,000 400,000 500,000 600,000
1,250,000................................ 375,000 500,000 625,000 750,000
1,500,000................................ 450,000 600,000 750,000 900,000
2,000,000................................ 600,000 800,000 1,000,000 1,200,000
The salaried pension plans are non-contributory plans providing for
benefits following retirement under a formula based upon years of participation
in the plans up to 30 years, the average of the three highest consecutive years'
earnings (salaries, annual bonuses and commissions, but excluding payouts under
the Strategic Incentive Plan), and age. The 2001 earnings used to calculate Mr.
Buckley's benefits under the salaried pension plans are $1,890,786, which
include his 2001 salary and the bonus paid in 2001 for 2000 performance.
The years of service of the officers named in the summary compensation
table are: Mr. Buckley 9 years, Mr. Hamilton 18 years, and Ms. Reich 5 years.
Mr. Barrington, Mr. McCoy and Mr. Mackey do not participate in any salaried
pension plan. Mr. Buckley's 9 years of service include 5 additional years of
service that were credited to him upon his completion of 3 years of employment
with the Company. In addition, if Mr. Buckley remains employed by the Company
until age 60, his pension benefit will be further enhanced to provide 40 percent
of his final average earnings at age 60, and will be further increased by three
percent for each year of employment thereafter to a maximum of 55 percent of his
final average earnings at age 65. Under an agreement with the Company, Mr.
Hamilton's 18 years include 12.5 years of service with a previous employer,
reduced by the pension he receives from that employer.
If there is a change in control of the Company on or before March 1, 2004,
and if there is a termination, merger or transfer of assets of the salaried
pension plans during the five years following the change in control of the
Company, benefits would be increased so that there would be no excess net
assets. Also, in the event of the involuntary termination of employment (other
than for cause) of a participant in the salaried pension plans during the five
years following such change in control of the Company, the participant's pension
would not be reduced as a result of early retirement. For purposes of pension
treatment, a change in control of the Company has the same definition as that
provided in Mr. Buckley's change in control agreement, which is described in the
section Employment Agreements and Other Transactions below.
EMPLOYMENT AGREEMENTS AND OTHER TRANSACTIONS
Under an agreement with the Company dated November 1, 2000, Mr. Buckley
would be entitled to certain severance benefits in the event his employment is
terminated other than for cause or disability. The agreement defines termination
to include resignation by Mr. Buckley in connection with certain events,
including a change in control of the Company or other substantial changes in the
terms and conditions of Mr. Buckley's employment.
If a termination covered by the agreement does not involve a change in
control, Mr. Buckley would be entitled to a severance payment equal to two times
his base salary and target annual bonus for the year in which termination
occurs. If such termination does involve a change in control, Mr. Buckley would
be entitled to a severance payment equal to three times the sum of (i) his
annual salary, (ii) the larger of his
18
targeted annual bonus for the year of termination or the year in which the
change in control occurs, and (iii) his most recent full-cycle target percentage
under the Strategic Incentive Plan (SIP), plus any applicable premium determined
as if the award were paid in stock. Mr. Buckley would also be entitled to
receive: any annual bonus earned for the preceding year that had not yet been
paid at the time of termination; a pro rata annual bonus for the year in which
termination occurs unless the termination occurs in the first quarter of the
year; and other benefits and perquisites for up to two years (three years in the
event of a change in control). If termination occurs following a change in
control, Mr. Buckley would also be entitled to a lump sum payment of accrued
pension and supplemental pension benefits, calculated as if he had worked for an
additional three years beyond the date of the change in control; accrued profit-
sharing benefits; accrued deferred compensation contributions; and would fully
vest in all outstanding stock options and restricted stock awards.
The definition of a change in control includes: (i) the acquisition of 25
percent or more of the outstanding voting stock of the Company by any person
other than an employee benefit plan of the Company; (ii) a tender offer for
stock of the Company which has not been negotiated and approved by the Company's
Board of Directors once (a) the offeror owns or has accepted for payment 25
percent or more of the outstanding voting stock of the Company, or (b) three
business days before the offer is to terminate, unless the offer is withdrawn
first, if the offeror could own 50 percent or more of the outstanding voting
stock of the Company as a result of the offer; (iii) the failure of the
incumbent Board of Directors to constitute a majority of the Company's Board of
Directors, excluding new directors who are approved by a vote of at least 75
percent and did not join the Board following a contested election of directors;
(iv) a merger of the Company with another corporation, other than a merger in
which the Company's stockholders receive at least 75 percent of the voting stock
outstanding after the merger or a merger effected to implement a
recapitalization of the Company in which no person acquires more than 25 percent
of the Company's voting stock; or (v) a complete liquidation or dissolution of
the Company or sale of substantially all of the Company's assets.
The terms of the agreement require Mr. Buckley to assent to certain
confidentiality, non-competition and non-solicitation provisions, and to execute
a general release.
In connection with his being named President and Chief Operating Officer in
May 2000, Mr. Buckley was required to relocate from Fond du Lac, Wisconsin, to
the Lake Forest, Illinois, area. In connection with Mr. Buckley's purchase of a
new home in the Lake Forest, Illinois, area, the Company loaned Mr. Buckley
$800,000 during 2000, to be repaid in five annual installments commencing August
1, 2001. This loan is secured by a mortgage on Mr. Buckley's home and will be
interest-free except in the event of default. Mr. Buckley timely made the 2001
payment under the loan, and is otherwise in full compliance with the terms of
the loan.
The Company's other Senior Executives are entitled to severance and change
in control benefits substantially similar to those outlined above for Mr.
Buckley, except that the severance payment triggered by a termination that does
not follow a change in control is equal to 1.5 times base salary plus a target
annual bonus as determined at the discretion of the Chief Executive Officer for
the year in which termination occurs.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING REQUIREMENTS
According to the Company's records, all directors and executive officers of
the Company timely filed all required reports in accordance with Section 16(a).
19
REPORT OF THE AUDIT AND FINANCE COMMITTEE
The following is the report of the Audit and Finance Committee with respect
to the Company's audited financial statements for the fiscal year ended December
31, 2001.
AUDIT AND FINANCE COMMITTEE CHARTER
The Board of Directors adopted a written charter for the Audit and Finance
Committee in 2000, and amended the charter in 2002. A copy of the amended
charter is attached to this proxy statement as Appendix A.
INDEPENDENCE OF AUDIT AND FINANCE COMMITTEE MEMBERS
The Board of Directors has determined that all members of the Audit and
Finance Committee are independent, in accordance with the New York Stock
Exchange audit committee requirements.
REVIEW WITH MANAGEMENT
The Audit and Finance Committee has reviewed and discussed the Company's
audited financial statements with management.
REVIEW AND DISCUSSIONS WITH INDEPENDENT ACCOUNTANTS
The Audit and Finance Committee has discussed with Arthur Andersen LLP
(Arthur Andersen), the Company's independent auditors for the fiscal year ended
December 31, 2001, the matters required to be discussed by SAS 61 (Codification
of Statements on Auditing Standards).
The Audit and Finance Committee has also received the written disclosures
and the letter from Arthur Andersen required by Independence Standards Board
Standard No. 1 (which relates to the accountant's independence from the Company
and its related entities) and has discussed with Arthur Andersen its
independence from the Company. The Audit and Finance Committee has also reviewed
the non-audit services provided by Arthur Andersen, as described below, and
determined that the provision of those services was compatible with maintaining
Arthur Andersen's independence.
CONCLUSION
Based on the review and discussions referred to above, the Audit and
Finance Committee recommended to the Company's Board that the audited financial
statements be included in the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 2001.
Submitted by Members of the Audit and Finance Committee of the Board of
Directors
M. J. Callahan (Chairman)
D. J. Bern
P. Harf
R. L. Ryan
20
PROPOSAL NO. 2: APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
Upon the recommendation of its Audit and Finance Committee, the Board of
Directors has appointed Ernst & Young LLP (Ernst & Young), independent public
accountants, as auditors for the Company and its subsidiaries for fiscal year
2002. The Board of Directors recommends that the appointment of Ernst & Young as
auditors for the Company and its subsidiaries be ratified. If shareholders do
not ratify the appointment, the Board of Directors and the Audit and Finance
Committee will reconsider their selection. Arthur Andersen served as independent
auditors for the Company and its subsidiaries for fiscal year 2001.
Representatives of Ernst & Young and Arthur Andersen will be invited to attend
the annual meeting of shareholders and afforded an opportunity to make a
statement, if they desire to do so, and to respond to questions from
shareholders.
On March 13, 2002, the Company terminated its engagement of Arthur Andersen
as independent auditors. The decision to terminate the engagement of Arthur
Andersen was recommended by the Company's Audit and Finance Committee and
approved by the Board of Directors.
Arthur Andersen's report on the financial statements of the Company for
each of the years ended December 31, 2000, and December 31, 2001, did not
contain an adverse opinion or a disclaimer of opinion and was not qualified or
modified as to uncertainty, audit scope or accounting principles.
During the years ended December 31, 2000, and December 31, 2001, and the
interim period between December 31, 2001, and March 13, 2002, there were no
disagreements between the Company and Arthur Andersen on any matter of
accounting principles or practices, financial statement disclosure or auditing
scope or procedure, which disagreements, if not resolved to the satisfaction of
Arthur Andersen, would have caused it to make reference to the subject matter of
the disagreements in connection with its report. During the years ended December
31, 2000, and December 31, 2001, and the interim period between December 31,
2001, and March 13, 2002, there were no reportable events (as defined in Item
304(a)(1)(v) of Regulation S-K promulgated by the Securities and Exchange
Commission).
During the years ended December 31, 2000, and December 31, 2001, and the
interim period between December 31, 2001, and March 13, 2002, the Company did
not consult with Ernst & Young regarding (i) the application of accounting
principles to a specified transaction, either completed or proposed, (ii) the
type of audit opinion that might be rendered on the Company's financial
statements or (iii) any matter that was either the subject of a disagreement (as
described above) or a reportable event.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THIS PROPOSAL
FEES INCURRED FOR SERVICES OF ARTHUR ANDERSEN
For 2001, the Company incurred the following fees for services rendered by
Arthur Andersen, the Company's accountant during the fiscal year ended December
31, 2001:
Audit Fees: The Company incurred $1,023,283 in fees for audit services
rendered by Arthur Andersen in connection with the audit of the Company's annual
and quarterly financial statements for 2001.
Financial Information Systems Design and Implementation Fees: The Company
incurred no fees for financial information systems design and implementation
services rendered by Arthur Andersen during 2001.
All Other Fees: The Company incurred $2,103,241 in fees for all services
rendered by Arthur Andersen during 2001 other than audit and financial
information systems design and implementation services.
21
SHAREHOLDER PROPOSALS
If a shareholder wants a proposal to be included in the Company's proxy
statement for the 2003 annual meeting, pursuant to Rule 14a-8 under the
Securities Exchange Act of 1934, the proposal must be received by the Company no
later than November 26, 2002. The proposal must be delivered to the Company's
offices at 1 N. Field Court, Lake Forest, Illinois 60045-4811, Attention:
Secretary, and must otherwise meet the requirements of the rules of the
Securities and Exchange Commission. The date after which a shareholder proposal
submitted outside the processes of Rule 14a-8 is considered untimely for the
2003 annual meeting is February 9, 2003, calculated as provided in Rule
14a-4(c)(1) under the Securities Exchange Act of 1934.
In order to assure the presence of the necessary quorum and to vote on the
matters to come before the annual meeting, please indicate your choices on the
enclosed proxy, and date, sign and return it promptly in the envelope provided.
Alternatively, you may vote your proxy by telephone or via the Internet by
following the instructions included with your proxy card.
By order of the Board of Directors,
/s/ MARSCHALL I. SMITH
MARSCHALL I. SMITH
Secretary
Lake Forest, Illinois
March 26, 2002
22
APPENDIX A
BOARD OF DIRECTORS OF BRUNSWICK CORPORATION
CHARTER OF THE AUDIT AND FINANCE COMMITTEE
(AS AMENDED THROUGH FEBRUARY 5, 2002)
STATEMENT OF POLICY
The audit and finance committee (the Committee) shall provide assistance to
the board of directors (the Board) in fulfilling the Board's responsibility to
oversee the Corporation's accounting, auditing and reporting practices, its
system of internal controls and the quality and integrity of its financial
information. In so doing, the Committee shall maintain free and open
communication with the Board, the independent auditors, the internal auditors
and management.
The Committee's role is one of oversight and it recognizes that the
Corporation's management is responsible for preparing the Corporation's
financial statements and that the independent auditors are responsible for
auditing those financial statements. Consequently, in carrying out its oversight
responsibilities, the Committee is not providing any expert or special assurance
as to the Corporation's financial statements or any professional certification
as to the work of the independent auditors.
MEMBERSHIP
- The Committee shall be comprised of three or more members of the Board,
one of whom shall be appointed as the chairman of the Committee.
- The Committee shall be composed of directors who in the opinion of the
full Board have no relationship to the Corporation that may interfere
with their exercise of independence from management and the Corporation.
- The Committee's members must be financially literate, or become
financially literate within a reasonable period of time after appointment
to the Committee, and at least one Committee member will have accounting
or related financial management expertise, as determined by the Board.
- Vacancies in the Committee may be filled at any meeting of the Board.
RESPONSIBILITIES
The independent auditors are ultimately accountable to the Board and the
Committee. The Committee, subject to any action that may be taken by the full
Board, shall have the ultimate authority and responsibility to select, evaluate
and, where appropriate, replace the independent auditors.
The Committee shall:
- Review the terms of engagement of the independent auditors, including the
scope and timing of their audits and related fees.
- Together with management, review the professional qualifications of
personnel of the independent audit firm assigned to the Corporation's
work, and review the audit firm's quality control and audit review
procedures.
- Review the independence of the independent auditors, including a review
and approval of the independent auditors' non-audit services and related
fees.
- Receive from the independent auditors annually, a formal written
statement delineating the relationships between the Corporation and
the auditor that may be thought to bear on independence, including
any hiring of the independent auditor's personnel by the
Corporation.
A-1
- Discuss with the independent auditors all disclosed relationships
and their impact on the independent auditors' independence.
- Recommend that the Board take appropriate action as applicable to
satisfy itself of the independent auditors' independence.
- Review with management, the independent auditors, and the internal
auditors:
- The Corporation's internal audit function, including its authority
and audit scope;
- Significant risks and exposures, audit activities, significant audit
findings and recommendations of the independent and internal
auditors; and
- The quality and adequacy of the Corporation's internal accounting
controls.
- Meet periodically with the independent auditors and internal auditors
without members of management present.
- Receive reports from the internal audit function which shall report
jointly to the chairman of the Committee and to management.
- Review and discuss with management and the independent auditors, prior to
the filing of the Corporation's Form 10-Q, the Corporation's interim
financial results to be included in the Corporation's quarterly reports
and the matters required to be discussed by the independent auditors with
the Committee, including the quality of the Corporation's financial
statements.
- Review and discuss with management and the independent auditors the
audited financial statements that are to be included in the Corporation's
Annual Report on Form 10-K (or the Annual Report to shareholders if
distributed prior to filing the Form 10-K) and the matters required to be
discussed by the independent auditors with the Committee, including the
quality of the Corporation's financial statements. Based on these
discussions, the Committee shall advise the Board whether it recommends
that the audited financial statements be included in the Annual Report on
Form 10-K (or the Annual Report to shareholders).
- Review matters that include:
- Changes in the Corporation's accounting policies and practices and
significant judgments that may affect the financial results;
- Legal, environmental, regulatory or other matters that may have a
material financial or disclosure impact, and any unusual or
significant commitments or contingent liabilities, together with the
underlying assumptions and estimates of management; and
- The effect of changes on accounting standards that may materially
affect the Corporation's financial reporting practices.
- Review the Corporation's annual report to stockholders and other SEC
filings, as it deems appropriate.
- Conduct or authorize investigations into any matters within the
Committee's scope of responsibilities. The Committee shall be empowered
to retain independent counsel or others to assist it in the conduct of
any investigation.
- Annually review the Committee's charter and assess the Committee's
effectiveness.
- Periodically receive reports on the Corporation's ethics program.
- Report to the Board on the Committee's activities following each meeting
of the Committee.
- Consider other matters in relation to the financial affairs of the
Corporation and in relation to the internal auditors and independent
auditors, as the Committee or the Board deems appropriate.
A-2
[BRUNSWICK LOGO]
BRUNSWICK CORPORATION
1 N. FIELD CT.
LAKE FOREST, IL 60045-4811 USA
VOTE BY INTERNET - WWW.PROXYVOTE.COM
Use the Internet to transmit your voting instructions and for electronic
delivery of information up until 11:59 p.m. Eastern Daylight Time the day before
the cut-off date or meeting date. Have your proxy card in hand when you access
the Web site. You will be prompted to enter your 12-digit Control Number, which
is located below to obtain your records and to create an electronic voting
instruction form.
VOTE BY PHONE - 1-800-690-6903
Use any touch-tone telephone to transmit your voting instructions up until 11:59
p.m. Eastern Daylight Time the day before the cut-off date or meeting date. Have
your proxy card in hand when you call. You will be prompted to enter your
12-digit Control Number which is located below and then follow the simple
instructions provided by the Vote Voice.
VOTE BY MAIL -
Mark, sign, and date your proxy card and return it in the postage-paid envelope
we have provided or return it to Brunswick Corporation., c/o ADP, 51 Mercedes
Way, Edgewood, NY 11717.
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: BRNSWK KEEP THIS PORTION FOR YOUR RECORDS
- ---------------------------------------------------------------------------------------------------------------------------------
DETACH AND RETURN THIS PORTION ONLY
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
BRUNSWICK CORPORATION
THE BOARD OF DIRECTORS
RECOMMENDS A VOTE FOR PROPOSALS 1 AND 2.
1. Election of Directors-Nominees
01) Dorrit J. Bern FOR WITHHOLD FOR ALL To withhold authority to vote, mark "For All Except"
02) Peter Harf ALL ALL EXCEPT and write the nominee's number on the line below.
03) Jay W. Lorsch
04) Bettye Martin Musham [ ] [ ] [ ] ____________________________________________________
05) Ralph C. Stayer
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
2. Ratification of Ernst & Young LLP as independent auditors
3. In their discretion, on such other business as may properly come before the meeting
THIS PROXY WILL BE VOTED AS DIRECTED BY THE SHAREHOLDER. IF NO DIRECTION IS
MADE, THIS PROXY WILL BE VOTED FOR PROPOSALS 1 AND 2.
NOTE: Please sign exactly as name(s) appear hereon. When signing as attorney, executor,
administrator, trustee, or guardian, please give full name as such.
If you plan on attending the annual meeting,
please mark box to the right. [ ]
Address change/comments? Please mark box
to the right and note on reverse side of card. [ ]
_________________________________ __________ _________________________________ __________
| | | | | |
|_________________________________|__________| |_________________________________|__________|
Signature [PLEASE SIGN WITHIN BOX] Date Signature (Joint Owners) Date
[BRUNSWICK LOGO]
TWO ADDITIONAL WAYS TO VOTE
VOTE BY INTERNET VOTE BY TELEPHONE
IT'S FAST, CONVENIENT, AND YOUR VOTE IT'S FAST, CONVENIENT, AND YOUR VOTE IS
IS IMMEDIATELY CONFIRMED AND REGISTERED. IMMEDIATELY CONFIRMED AND REGISTERED.
YOU MAY ALSO GIVE YOUR CONSENT TO HAVE
ALL FUTURE PROXY STATEMENTS AND ANNUAL
REPORTS DELIVERED TO YOU ELECTRONICALLY. CALL TOLL-FREE ON A TOUCH-TONE PHONE IN THE
U.S. OR CANADA
GO TO WEB SITE 1-800-690-6903
WWW.PROXYVOTE.COM
Follow these four easy steps: Follow these four easy steps:
- - Read the accompanying Proxy Statement and - Read the accompanying Proxy Statement and
Proxy Card. Proxy Card.
- - Go to Web site WWW.PROXYVOTE.COM. - Call the toll-free phone number above.
- - Enter your unique 12-digit Control Number - Enter your unique 12-digit Control Number
located on your Proxy Card. located on your Proxy Card.
- - Follow the simple instructions. - Follow the simple instructions.
VOTE 24 HOURS A DAY
DO NOT RETURN PROXY CARD IF YOU ARE VOTING BY INTERNET OR TELEPHONE
Registered
- ----------------------------------------------------------------------------------------------------------------
PROXY
Solicited on behalf of the Board of Directors of
BRUNSWICK CORPORATION
The undersigned hereby appoints G.W. Buckley, V.J. Reich and M.I. Smith, and each of them, as proxies with
power of substitution, and hereby authorizes them to represent and to vote, in accordance with the instructions
on the reverse side, all shares of Common Stock of Brunswick Corporation that the undersigned may be entitled to
vote at the Annual Meeting of Shareholders to be held on May 1, 2002, or any adjournment thereof.
This proxy also provides voting instructions for shares held by the Bank of New York, the trustee for the
Brunswick Employee Stock Ownership Plan, and Vanguard Fiduciary Trust Company, the trustee for the Brunswick
Retirement Savings Plan and the Brunswick Rewards Plan, and directs such trustees to vote, as indicated on the
reverse side of this card, any shares allocated to your account in these plans. The Trustees will vote your
shares as you direct. The Trustees will vote allocated shares of the Company's stock (except shares acquired
with tax credit contributions) for which proxies are not received and unallocated shares in direct proportion to
voting by allocated shares for which proxies are received.
THIS PROXY/VOTING INSTRUCTION CARD IS SOLICITED PURSUANT TO A SEPARATE NOTICE OF ANNUAL MEETING AND PROXY
STATEMENT, RECEIPT OF WHICH IS HEREBY ACKNOWLEDGED. THIS CARD SHOULD BE VOTED, BY MAIL, INTERNET OR TELEPHONE,
IN TIME TO REACH THE COMPANY'S PROXY TABULATOR, AUTOMATIC DATA PROCESSING, BY 9:00 A.M. EASTERN DAYLIGHT TIME ON
WEDNESDAY, MAY 1, 2002, FOR ALL REGISTERED SHARES TO BE VOTED AND BY 5 :00 P.M. EASTERN DAYLIGHT TIME ON FRIDAY,
APRIL 26, 2002, FOR THE TRUSTEES TO VOTE THE PLAN SHARES. INDIVIDUAL PROXY VOTING AND VOTING INSTRUCTIONS WILL
BE KEPT CONFIDENTIAL BY AUTOMATIC DATA PROCESSING AND WILL NOT BE PROVIDED TO THE COMPANY.
ADDRESS CHANGES/COMMENTS:
__________________________________________________________________________________________________________________
__________________________________________________________________________________________________________________
__________________________________________________________________________________________________________________