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o Preliminary
Proxy Statement |
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o Confidential,
for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
| ||
þ Definitive
Proxy Statement | ||
o Definitive
Additional Materials | ||
o Soliciting
Material Pursuant to Section 240.14a-11c or Section 240.14a-12
|
þ |
No
fee required. |
|
|
o |
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):
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(4) |
Proposed
maximum aggregate value of transaction: |
(5) |
Total
fee paid: |
o |
Fee
paid previously with preliminary materials. |
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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: |
· |
Election
of Directors for the ensuing year; and |
· |
Ratification
of the selection of Deloitte & Touche LLP as the independent auditor
for 2005. |
Who
may vote
Holders
of Bristol West Holdings, Inc. (the “Company”) common shares, as recorded
in the Company’s share register on April 4, 2005, may vote at the meeting.
As of that date, there were 31,598,451 shares of common stock outstanding
and entitled to one vote per share. A list of stockholders will be
available for inspection for at least ten days prior to the meeting at the
Company’s offices at 5701 Stirling Road, Davie, Florida
33314.
How
to vote
You
may vote in person at the meeting or by proxy. We recommend that you vote
by proxy even if you expect to attend the meeting. You will be able to
change your vote at the meeting.
Please
refer to your proxy card or the information forwarded by your bank, broker
or other holder of record to see how you should complete your proxy card
and deliver it to the Company.
How
proxies work
The
Board of Directors (the “Board”) of the Company is asking for your proxy.
Giving us your proxy means you authorize us to vote your shares at the
meeting, or at any adjournment thereof, in the manner you direct. You may
vote for or against the proposals or abstain from voting. You may also
vote for all, some or none of the directors seeking election.
If
you sign and return the enclosed proxy card but do not specify how to
vote, we will vote your shares in favor of all items herein to be voted
on.
As
of the date hereof, we do not know of any other business that will be
presented at the meeting. If other business shall properly come before the
meeting or any adjournment or postponement thereof, the person or persons
named in the proxy will vote according to their best
judgment.
Solicitation
In
addition to this mailing, the Company’s employees may solicit proxies
personally, electronically or by telephone. We pay the costs of soliciting
this proxy. We also reimburse brokers and other nominees for their
expenses in sending these materials to you and getting your voting
instructions. |
Revoking
a proxy
You
may revoke your proxy before it is voted by submitting a new proxy with a
later date, by voting in person at the meeting or by notifying the
Company’s Corporate Secretary.
Quorum
In
order to transact business at the meeting, we must have a quorum. Under
the Company’s by-laws, stockholders representing a majority of the
Company’s issued and outstanding common stock, present in person or by
proxy and entitled to vote, constitute a quorum.
Only
stockholders, their proxy holders and the Company’s guests may attend the
meeting. Verification of ownership may be required at the admissions desk.
If your shares are held in the name of your broker, bank or other nominee,
you must bring with you to the meeting an account statement or letter from
the nominee indicating that you are the beneficial owner of the shares on
April 4, 2005, the record date for voting.
Votes
needed
All
proposals to be acted on at the meeting require the affirmative vote of a
majority of the votes cast at a meeting at which a quorum is present.
Accordingly, abstentions and broker non-votes, though counted for the
purposes of determining the quorum present for the transaction of
business, will have the effect of not voting in favor of a proposal. A
broker non-vote is a proxy submitted by a broker in which the broker fails
to vote on behalf of a client on a particular matter for lack of
instructions when such instruction is required by the New York Stock
Exchange. |
Name
|
Age |
Position
|
James R.
Fisher |
49 |
Chief
Executive Officer and Chairman of the Board |
Jeffrey J.
Dailey |
48 |
President
and Chief Operating Officer |
Anne M.
Bandi |
48 |
Senior
Vice President—Operations |
George
N. Christensen |
59 |
Senior
Vice President—Business Integration |
Brian
J. Dwyer |
48 |
Senior
Vice President—Product Research and Development |
Craig E.
Eisenacher |
57 |
Senior
Vice President—Chief Financial Officer |
Nila J.
Harrison |
41 |
Senior
Vice President—Human Resources |
Simon J.
Noonan |
41 |
Senior
Vice President—Actuarial/Product |
Ronald
E. Latva |
40 |
Senior
Vice President—Product Management |
George
G. O’Brien |
49 |
Senior
Vice President—Chief Legal Officer |
John
L. Ondeck |
45 |
Senior
Vice President—Chief Information Officer |
Alexis
S. Oster |
36 |
Senior
Vice President—General Counsel |
Robert D.
Sadler |
41 |
Senior
Vice President—Marketing |
James J.
Sclafani, Jr. |
45 |
Senior
Vice President—Claims |
Audrey
E. Sylvan |
41 |
Senior
Vice President—Product Management |
Number
of Shares
Beneficially
Owned |
Percentage
of Shares
at
April
4, 2005 | ||
Name
and Address |
|||
Bristol
West Associates LLC1 |
12,434,3182 . |
39.4% | |
C/O
KKR & Co |
|||
9
West 57th St 41st Floor |
|||
New
York, NY 10019 |
|||
T.
Rowe Price Associates Inc.3
|
1,676,900 |
5.3% | |
100
East Pratt St. |
|||
Baltimore,
MD 21202 |
|||
Stadium
Capital Management LLC4 |
1,963,600 |
6.2% | |
2483
East Bayshore Road Ste 202 |
|||
Palo
Alto, CA 94303 |
Number of Shares |
Percentage
of Shares | ||
Name |
Beneficially
Owned |
Beneficially
Owned | |
James
R. Fisher (1) |
1,053,485 |
3.2% | |
R.
Cary Blair |
4,174 |
* | |
Richard
T. Delaney (2) |
8,468 |
* | |
Todd
A. Fisher (3) |
12,435,989 |
39.4% | |
Perry
Golkin (4) |
12,435,989 |
39.4% | |
Inder-Jeet
S. Gujral (5) |
134,225 |
* | |
Mary
R. Hennessy (6) |
4,158 |
* | |
Eileen
Hilton |
2,174 |
* | |
James
N. Meehan (7) |
23,322 |
* | |
Scott
C. Nuttall (8) |
1,671 |
* | |
Arthur
J. Rothkopf (9) |
3,009 |
* | |
Jeffrey
J. Dailey (10) |
360,321 |
1.1% | |
Craig
E. Eisenacher (11) |
56,523 |
* | |
Simon
J. Noonan (12) |
151,497 |
* | |
James
J. Sclafani, Jr. (13) |
77,479 |
* | |
All
directors and executive |
|||
officers
as a group (25 persons) |
15,070,569 |
45.1% |
2004 |
2003 | |
|
||
Audit fees............................................................................................................. |
$
1,344,420 |
$
933,100 |
Audit-related
fees (1)………………………………………….......................... |
37,700
|
36,830
|
Tax
fees (2)………………………………………………….….......................... |
98,737
|
100,762
|
All
other fees…………………………….…………………….......................... |
0 |
0 |
Total
fees…………………………………...………………….......................... |
$
1,480,857 |
$
1,070,692 |
(1) |
Audit-related
fees represent fees for employee benefit plan
audits. |
(2) |
Tax
fees represent fees for tax compliance, tax consulting and tax planning
services. |
Name |
Year |
Salary
($) |
Bonus
($) |
Other
Annual
Compensation ($) |
Restricted
Stock
Awards
($) |
Securities
Underlying
Options
(#) |
LTIP
Payouts
($) |
All
Other
Compensation |
James
R. Fisher (1) |
2004 |
700,000 |
175,000(2) |
- |
250,000
(3) |
(1) |
- |
- |
2003 |
- |
- |
25,000 |
- |
(1) |
- |
- | |
2002 |
- |
- |
25,000 |
- |
(1) |
- |
- | |
Jeffrey
J. Dailey (4) |
2004 |
390,000 |
213,750
|
58,478
(5) |
1,071,250(6) |
- |
- |
- |
2003 |
385,385 |
232,500 |
- |
- |
3,706 |
- |
- | |
2002 |
375,000 |
140,625 |
- |
- |
8,149 |
- |
- | |
Craig
E. Eisenacher |
2004 |
275,000 |
90,000
(7) |
- |
530,000(10) |
- |
- |
- |
2003 |
10,577 |
150,000(8) |
202,580
(9) |
- |
- |
- |
- | |
2002 |
- |
- |
- |
- |
- |
- |
- | |
Simon
J. Noonan (11) |
2004 |
282,692 |
108,750 |
- |
536,250(12) |
- |
- |
- |
2003 |
260,096 |
84,375 |
- |
- |
1,793 |
- |
- | |
2002 |
163,461 |
108,750 |
- |
- |
3,260 |
- |
- | |
James
J. Sclafani, Jr. (13) |
2004 |
283,077 |
56,250 |
- |
351,750(14) |
- |
- |
- |
2003 |
266,538 |
154,202 |
- |
- |
1,255 |
- |
- | |
2002 |
- |
- |
- |
- |
- |
- |
- |
(1) |
For
the years ended December 31, 2003 and December 31, 2002, James
R. Fisher was not a direct employee of the Company. All compensation due
to Mr. Fisher, in his role as Chief Executive Officer, was paid to
Fisher Capital Corp., LLC. Mr. Fisher is the managing member and
majority owner of Fisher Capital, and received 86.5% of all compensation
paid by the Company to Fisher Capital for his services as Chief Executive
Officer and the additional services Fisher Capital provides. For the years
ended December 31, 2003 and December 31, 2002, the fee paid to
Fisher Capital as compensation for Mr. Fisher's serving as Chief
Executive Officer was $700,000. In addition, for the years ended
December 31, 2003 and December 31, 2002, Fisher Capital was
granted 221,646 options and 130,380 options, respectively, at an exercise
price of $3.83 per option share, which options Mr. Fisher may be
deemed to beneficially own. Mr. Fisher also received, directly, a $25,000
annual fee for serving on the Board. Effective January 1, 2004,
Mr. Fisher entered into an employment agreement with the Company.
This employment agreement made him a direct employee of the Company and
his compensation is paid directly to him. Mr. Fisher is no longer
eligible to receive the $25,000 annual fee for serving on the Board.
|
(2) |
Mr.
Fisher was paid a one-time signing bonus of $175,000 for entering into his
employment agreement effective as of January 1, 2004. Mr. Fisher also
received $250,000 in a grant of restricted stock as a bonus for 2004
performance. This restricted stock grant is included in the Restricted
Stock Awards column of this table. |
(3) |
Mr.
Fisher received $250,000 in a grant of restricted stock as a bonus for
2004 performance. This restricted stock cliff vests two years from the
date of the grant, so long as Mr. Fisher continues to serve as an employee
of the Company until the vesting date. |
(4) |
In
addition to the cash amounts set forth in the Bonus column of this table,
Mr. Dailey also received a grant of restricted stock as part of his annual
bonus for 2004 performance and grants of options to purchase shares of the
Company’s stock as part of his annual bonuses for 2003 and 2002
performance. These grants are included in the Restricted Stock Awards
column and the Securities Underlying Options column of this
table. |
(5) |
This
amount includes $22,388 of expenses paid by the Company in connection with
an automobile provided to Mr. Dailey for personal use, $33,750 in expenses
paid by the Company to Mr. Dailey for unused paid time off, and $2,340 in
matching contributions made by the Company to Mr. Dailey’s 401(k) account,
pursuant to the Company’s Retirement Security Program.
|
(6) |
This
amount consists of a restricted stock award of $1,000,000 that cliff vests
five years after the grant date of May 14, 2004 and a restricted stock
award of $71,250 that cliff vests two years after the grant date of
February 22, 2005, so long as Mr. Dailey continues to serve as an employee
of the Company until the respective vesting dates.
|
(7) |
In
addition to this cash amount of his bonus for 2004 performance, Mr.
Eisenacher also received a grant of restricted stock as part of his annual
bonus for 2004 performance. This restricted stock grant is included in the
Restricted Stock Awards column of this
table. |
(8) |
Mr.
Eisenacher began his employment with the Company on December 8, 2003 and
received a one-time signing bonus of $150,000.
|
(9) |
This
amount consists of expenses paid by the Company in connection with the
relocation of Mr. Eisenacher. |
(10) |
This
amount consists of a restricted stock award of $500,000 that cliff vests
five years after the grant date of May 14, 2004, and a restricted stock
award of $30,000 that cliff vests two years after the grant date of
February 22, 2005, so long as Mr. Eisenacher continues to serve as an
employee of the Company until the respective vesting
dates. |
(11) |
In
addition to the cash amounts set forth in the Bonus column of this table,
Mr. Noonan also received a grant of restricted stock as part of his annual
bonus for 2004 performance and grants of options to purchase shares of the
Company’s stock as part of his annual bonuses for 2003 and 2002
performance. These grants are included in the Restricted Stock Awards
column and the Securities Underlying Options column of this
table. |
(12) |
This
amount consists of a restricted stock award of $500,000 that cliff vests
five years after the grant date of May 14, 2004, and a restricted stock
award of $36,250 that cliff vests two years after the grant date of
February 22, 2005, so long as Mr. Noonan continues to serve as an employee
of the Company until the respective vesting
dates. |
(13) |
In
addition to the cash amounts set forth in the Bonus column of this table,
Mr. Sclafani also received a grant of restricted stock as part of his
annual bonus for 2004 performance and a grant of options to purchase
shares of the Company’s stock as part of his annual bonus for 2003
|
|
performance.
These grants are included in the Restricted Stock Awards column and the
Securities Underlying Options column of this
table. |
(14) |
This
amount consists of a restricted stock award of $333,000 that cliff vests
five years after the grant date of May 14, 2004, and a restricted stock
award of $18,750 that cliff vests two years after the grant date of
February 22, 2005, so long as Mr. Sclafani continues to serve as an
employee of the Company until the respective vesting
dates. |
Name |
Number
of Shares Awarded in 2004
(Time-Based) |
Dividends
Paid
in
2004
on Restricted
Holdings
($) (1) |
Value
of
Aggregate
Restricted Stock Holdings at
12/31/04
($) (2) | |||
James
R. Fisher |
--- |
--- |
--- | |||
Jeffrey
J. Dailey |
54,348 |
8,152
|
1,086,960 | |||
Craig
E. Eisenacher |
27,174 |
4,076
|
543,480 | |||
Simon
J. Noonan |
27,174 |
4,076
|
543,480 | |||
James
J. Sclafani, Jr. |
18,098 |
2,715
|
361,960 |
(1) |
This
column represents dividends accrued for but not received by the executives
for the Restricted Stock Awards. Dividends are paid to the executives upon
the vesting of the restricted stock. |
(2) |
These
values are based on the December 31, 2004 closing price for the Company’s
stock of $20.00 per share. |
Name |
Number
of Securities Underlying Options Granted |
%
of Total
Options
Granted
to
Employees
in
Fiscal Year |
Exercise
or
Base
Price ($) |
Expiration
Date |
Grant
Date
Present
Value ($) | ||||
James
R. Fisher |
--- |
--- |
--- |
|
--- |
--- | |||
Jeffrey
J. Dailey |
3,706 |
.147 |
20.91(1) |
|
04.05.14 |
18,422
(2) | |||
Craig
E. Eisenacher |
--- |
--- |
--- |
--- |
--- | ||||
Simon
J. Noonan |
1,793 |
.071 |
20.91(1) |
|
04.05.14 |
8,913
(2) | |||
James
J. Sclafani |
1,255 |
.050 |
20.91(1) |
|
04.05.14 |
6,238
(2) |
(1) |
These
options were granted under the Company’s 2004 Stock Incentive Plan. The
option exercise price is $20.91, the market value of the Company’s stock
on the date of the grant. |
(2) |
These
values were determined based on the Black-Scholes option pricing model.
Calculation of the Grant Date Present Value was based on the following
assumptions: price volatility of 25.87%; a dividend yield of 0.96%; a
risk-free rate of return of 2.07%; and exercise of the options ten years
after their grant. |
Plan
Category |
Number
of Securities to be Issued Upon Exercise of Outstanding
Options |
Weighted-Average
Exercise Price of Outstanding Options |
Cumulative
Number of Securities Awarded as
Restricted Stock |
Number
of Securities Remaining Available For Future Issuance
Under
Equity Compensation
Plans
|
Equity
compensation plans
approved
by security holders |
||||
None
(1) |
- |
- |
- |
- |
Equity
compensation plans not approved
by security holders: |
||||
1998
Stock Option Plan: |
3,235,586 |
$4.11 |
- |
96,732 |
2004
Stock Incentive Plan: |
24,199 |
$20.91 |
312,157 |
2,681,742 |
Total: |
3,259,785 |
$4.23 |
312,157 |
2,778,474 |
(1) |
The
1998 Stock Option Plan and the 2004 Stock Incentive Plan were not subject
to stockholder approval as the Company was privately held until its
initial public offering on February 12,
2004. |
Number
of Securities Underlying Unexercised Options at
December
31, 2004 |
Value
of Unexercised in-the- Money Options at
December
31, 2004 ($) | ||||||||
Name |
Shares
Acquired On Exercise |
Value
Realized
($) |
Exercisable |
Unexercisable |
Exercisable |
Unexercisable | |||
James
R. Fisher |
--- |
--- |
873,546 |
--- |
14,125,238 |
--- | |||
Jeffrey
J. Dailey |
--- |
--- |
180,087 |
112,085 |
2,896,362 |
1,736,840 | |||
Craig
E. Eisenacher |
--- |
--- |
9,778 |
39,115 |
45,565 |
182,275 | |||
Simon
J. Noonan |
--- |
--- |
94,200 |
3,423 |
1,516,954 |
20,098 | |||
James
J. Sclafani, Jr. |
--- |
--- |
16,949 |
69,053 |
274,065 |
1,096,294 |
§ |
Alignment:
Link
executive compensation rewards with growth in earnings and strategic
operational performance that ultimately results in sustainable increases
in shareholder value. |
§ |
Motivation:
Motivate
executives to be accountable for and accomplish the Company’s financial
and strategic operational objectives. |
§ |
Retention
and Attraction: Retain
and attract key executives to drive increases in shareholder
value. |
§ |
Salary
levels and salary increases
that reflect position responsibilities, competitive market rates,
strategic importance of the position, and individual performance and
contributions. |
§ |
Annual
incentive payments, based
on the
Company’s performance relative to its earnings goals and other strategic
objectives and individual performance. |
§ |
Long-term
incentives, provided through
restricted stock and stock option grants, that reward
key executives for performance related to increasing shareholder value,
that vest over time, and encourage executive stock ownership.
|
§ |
Benefit programs provided to all employees in which the Company’s executives are eligible to participate. |
Total
Return Analysis *
(Assumes a $100 investment at the close of trading
on February 12, 2004)
02/12/2004 12/31/2004 | |||||
Bristol
West Holdings, Inc $100.00 $100.82
| |||||
S&P
500 Property & Casualty Insurance Index (1)
$100.00 $103.32
| |||||
S&P
500 Index (1)
$100.00
$106.29
|
a) |
A
director will not be considered independent if,
|
· |
the
director is, or has been within the last three years, an employee of the
Company, or an immediate family member is or has been within the last
three years, an executive officer, of the Company;
or |
· |
the
director or an immediate family member of the director, has received,
during any twelve-month period within the last three years, more than
$100,000 in direct compensation from the Company, other than director and
committee fees and pension or other forms of deferred compensation for
prior service (provided that such compensation is not contingent in any
way on continued service with the Company); except that compensation
received by an immediate family member of the director for services as an
non-executive employee of the Company need not be considered in
determining independence under this test;
or |
· |
the
director or an immediate family member is a current partner of a firm that
is the Company’s internal or external auditor; or the director is a
current employee of such a firm; or the director has an immediate family
member who is a current employee of such a firm and who participates in
the firm’s audit, assurance or tax compliance (but not tax planning)
practice; or the director or an immediate family member was within the
last three years (but is no longer) a partner or employee of such a firm
and personally worked on the Company’s audit within that time frame; or
the director, or an immediate family member of the director, is or has
been within the last three years, employed as an executive officer of
another company where any of the Company’s present executives at the same
time serves or served on that company’s compensation committee;
or |
· |
the
director is a current employee, or an immediate family member is a current
executive officer, of a company (other than a charitable organization)
that has made payments to, or received payments from, the Company for
property or services in an amount which, in any of the last three fiscal
years, exceeds the greater of $1 million or 2% of such other company’s
consolidated gross revenues; provided, however, that in applying this
test, both the payments and the consolidated gross revenues to be measured
will be those reported in the last completed fiscal year; and provided,
further, that this test applies solely to the financial relationship
between the Company and the director’s (or immediate family member’s)
current employer - the former employment of the director or immediate
family member need not be considered. |
b) |
A
director will only be appointed as a member of the Board Audit Committee
if he or she also satisfies the independence criteria laid down in SEC
Rule 10A-3. |
c) |
The
following relationships will not be considered to be material
relationships that would impair a director’s
independence: |
· |
Commercial
Relationship: If
a director of the Company is an executive officer or an employee, or whose
immediate family member is an executive officer, of another company that
makes payments to, or receives payments from, the Company for property or
services in an amount which, in any single fiscal year, does not exceed
the greater of (a) $1,000,000 or (b) 2% of such other company’s
consolidated gross revenues: |
· |
Indebtedness
Relationship: If
a director of the Company is an executive officer of another company which
is indebted to the Company, or to which the Company is indebted, and
the |
|
total
amount of either company’s indebtedness is less than 2% of the
consolidated assets of the company wherein the director serves as an
executive officer; |
· |
Equity
Relationship: If
the director is an executive officer of another company in which the
Company owns a common stock interest, and the amount of the common stock
interest is less than 10% of the total shareholders’ equity of the company
where the director serves as an executive officer;
or |
· |
Charitable
Relationship: If
a director of the Company, or the spouse of a director of the Company,
serves as a director, officer or trustee of a charitable organization, and
the Company’s contributions to the organization in any single fiscal year
are less than the greater of (a) $1,000,000 or (b) 2% of that
organization’s gross
revenues. |
d) |
For
relationships that do not meet the categorical standards of immateriality
set forth in section (c) above, or for relationships that are covered, but
as to which the Board believes a director may nevertheless be considered
independent, the determination of whether the relationship is material or
not, and therefore whether the director would be independent, will be made
by the directors who satisfy the independence guidelines set forth in
Sections (a) to (c) above. The Company will explain in its proxy statement
any Board determination that a relationship was immaterial in the event
that it did not meet the categorical standards of immateriality set forth
in Section (c) above. |
e) |
For
the purposes of these standards, an “immediate family member” includes a
person’s spouse, parents, children, siblings, mothers-in-law,
fathers-in-law, sons-in-law, daughters-in law, brothers-in-law,
sisters-in-law and anyone (other than domestic employees) who shares such
person’s home; except that when applying the independence tests described
above, the Company need not consider individuals who are no longer
immediate family members as a result of legal separation or divorce or
those who have died or have become
incapacitated. |
1 |
The
Committee will review periodically the Board’s current and projected
strengths and needs by, among other things, reviewing the Board’s current
profile, its Director Qualification Standards and the Company’s current
and future needs. |
2 |
Using
the results of the review, the Committee will prepare a target candidate
profile. |
3 |
The
Committee will develop an initial list of director candidates by utilizing
the personal network of the Board and senior management of the Company,
and considering any nominees previously recommended including those
received from shareholders. The Committee may retain a search firm to
assist with this process. |
4 |
The
Committee will consider the director candidates to identify those
individuals who best fit the target candidate profile and the Board’s
Director Qualification Standards. From this review, the Committee will
prepare a list of preferred candidates and present it to the full Board
for input. |
5 |
The
Committee will determine if any director has a business or personal
relationship with any of the preferred candidates that will enable the
director to initiate contact with the candidate to determine his or her
interest in being considered for membership to the Board. If necessary,
the search firm assisting with the process will be used to initiate this
contact. |
6 |
Whenever
possible, the Chairman of the Committee, at least one other independent
member of the Board and the Chairman and Chief Executive Officer will
interview each interested preferred
candidate. |
7 |
Based
on input received from the candidate interviews, the Committee will
determine whether to extend an invitation to a candidate to join the
Board. |
8 |
A
reference check will be performed on the
candidate. |
9 |
Depending
on the results of the reference check, the Committee will extend the
candidate an invitation to join the Board, subject to election by the
Board. |
10 |
The
Board will vote on whether to elect the candidate to the
Board. |
1 |
Integrity.
Directors should have proven integrity and be of the highest ethical
character and share the Company’s values. |
2 |
Reputation.
Directors should have reputations, both personal and professional,
consistent with the Company’s image and
reputation. |
3 |
Judgment.
Directors should have to ability to exercise sound business judgment on a
broad range of issues. |
4 |
Knowledge.
Directors should be financially literate and have a sound understanding of
business strategy, business environment, corporate governance and board
operations. |
5 |
Experience.
In selecting directors, the Board should generally seek those with
practical experience of large and complex divisions of publicly held
companies, and leaders of major complex organizations, including
scientific, accounting, government, educational and other non-profit
institutions. |
6 |
Maturity.
Directors should value Board and team performance over individual
performance, possess respect for others and facilitate superior Board
performance. |
7 |
Skills
and Personality.
In selecting directors the Board should consider the interplay of the
individual’s experience, skills and personality with those of other
directors and potential directors in building a Board that is effective,
collegial and responsive to the needs of the
Company. |
8 |
Commitment.
Directors should be able and willing to devote the required amount of time
to the Company’s affairs, including preparing for and attending meetings
of the Board and its committees. Directors should be actively involved in
the Board and its decision-making. |
9 |
Independence.
Directors should be independent in their thought and judgment
and be committed to represent the long-term interests of all of the
Company’s
shareowners. |
1. |
Review
with management and the independent auditors prior to public dissemination
the corporation’s annual audited financial statements and quarterly
financial statements, including the corporation’s disclosures under
“Management’s Discussion and Analysis of Financial Condition and Results
of Operations” and a discussion with the independent auditors of the
matters required to be discussed by Statement of Auditing Standards No.
61. |
2. |
Review
and discuss with management and the independent auditors the corporation’s
earnings press releases (paying particular attention to the use of any
“pro forma” or “adjusted” non-GAAP information), as well as financial
information and earnings guidance provided to analysts and rating
agencies. The Committee’s discussion in this regard may be general in
nature (i.e., discussion of the types of information to be disclosed and
the type of presentation to be made) and need not take place in advance of
each earnings release or each instance in which the corporation may
provide earnings guidance. |
3. |
Perform
any functions required to be performed by it or otherwise appropriate
under applicable law, rules or regulations, the corporation’s by-laws and
the resolutions or other directives of the Board, including review of any
certification required to be reviewed in accordance with applicable law or
regulations of the SEC. |
4. |
Retain
and terminate independent auditors and approve all audit engagement fees
and terms. |
5. |
Inform
each registered public accounting firm performing work for the corporation
that such firm shall report directly to the
Committee. |
6. |
Oversee
the work of any registered public accounting firm employed by the
corporation, including the resolution of any disagreement between
management and the auditor regarding financial reporting, for the purpose
of preparing or issuing an audit report or related
work. |
7. |
Approve
in advance any significant audit or non-audit engagement or relationship
between the corporation and the independent auditors, other than
“prohibited non-auditing services”. |
8. |
Review,
at least annually, the qualifications, performance and independence of the
independent auditors. In conducting its review and evaluation, the
Committee should: |
(b) |
Ensure
the rotation of the lead audit partner at least every five years, and
consider whether there should be regular rotation of the audit firm
itself. |
(c) |
Confirm
with any independent auditor retained to provide audit services for any
fiscal year that the lead (or coordinating) audit partner (having primary
responsibility for the audit), or the audit partner responsible for
reviewing the audit, has not performed audit services for the corporation
in each of the five previous fiscal years of that
corporation. |
(d) |
Take
into account the opinions of management and the corporation’s internal
auditors (or other personnel responsible for the internal audit
function). |
9. |
In
consultation with the independent auditors, management and the internal
auditors, review the integrity of the corporation’s financial reporting
processes, both internal and external. In that connection, the Committee
should obtain and discuss with management and the independent auditor
reports from management and the independent auditor regarding: (i) all
critical accounting policies and practices to be used by the corporation;
(ii) analyses prepared by management and/or the independent auditor
setting forth significant financial reporting issues and judgments made in
connection with the preparation of the financial statements, including all
alternative treatments of financial information within generally accepted
accounting principles that have been discussed with the corporation’s
management, the ramifications of the use of the alternative disclosures
and treatments, and the treatment preferred by the independent auditor;
(iii) major issues regarding accounting principles and financial statement
presentations, including any significant changes in the corporation’s
selection or application of accounting principles; (iv) major issues as to
the adequacy of the corporation’s internal controls and any specific audit
steps adopted in light of material control deficiencies; and (v) any other
material written communications between the independent auditor and the
corporation’s management. |
10. |
Review
periodically the effect of regulatory and accounting initiatives, as well
as off-balance sheet structures, on the financial statements of the
corporation. |
11. |
Review
with the independent auditor (i) any audit problems or other difficulties
encountered by the auditor in the course of the audit process, including
any restrictions on the scope of the independent auditor’s activities or
on access to requested information, and any significant disagreements with
management and (ii) management’s responses to such matters. Without
excluding other possibilities, the Committee may wish to review with the
independent auditor (i) any accounting adjustments that were noted or
proposed by the auditor but were “passed” (as immaterial or otherwise),
(ii) any communications between the audit team and the audit firm’s
national office respecting auditing or accounting issues presented by the
engagement and (iii) any “management” or “internal control” letter issued,
or proposed to be issued, by the independent auditor to the
corporation. |
12. |
Review
and discuss with the independent auditor the responsibilities, budget and
staffing of the corporation’s internal audit
function. |
13. |
Review
periodically, with the corporation’s counsel, any legal matter that could
have a significant impact on the corporation’s financial statements.
|
14. |
Discuss
with management and the independent auditors the corporation’s guidelines
and policies with respect to risk assessment and risk management. The
Committee should discuss the corporation’s major financial risk exposures
and the steps management has taken to monitor and control such
exposures. |
15. |
Set
clear hiring policies for employees or former employees of the independent
auditors. At a minimum, these policies should provide that any registered
public accounting firm may not provided audit services to the corporation
if the CEO, controller, CFO, chief accounting officer or any person
serving in an equivalent capacity for the corporation was employed by the
registered public accounting firm and participated in the audit of the
corporation within one year of the initiation of the current audit.
|
16. |
Establish
procedures for: (i) the receipt, retention and treatment of complaints
received by the corporation regarding accounting, internal accounting
controls, or auditing matters; and (ii) the confidential, anonymous
submission by employees of the corporation of concerns regarding
questionable accounting or auditing
matters. |
17. |
Prepare
all reports required to be included in the corporation’s proxy statement,
pursuant to and in accordance with applicable rules and regulations of the
SEC. |
18. |
Report
regularly to the full Board of Directors
including: |
(i) |
with
respect to any issues that arise with respect to the quality or integrity
of the corporation’s financial statements, the corporation’s compliance
with legal or regulatory requirements, the performance and independence of
the corporation’s independent auditors or the performance of the internal
audit function; |
(ii) |
following
all meetings of the Committee; and |
(iii) |
with
respect to such other matters as are relevant to the Committee’s discharge
of its responsibilities. |
19. |
Maintain
minutes or other records of meetings and activities of the Committee.
|
1. |
Establish
and review the overall compensation philosophy of the
corporation. |
2. |
Review
and approve corporate goals and objectives relevant to the CEO and other
executive officers compensation, including annual performance objectives.
|
3. |
Evaluate
the performance of the CEO and other executive officers in light of these
goals and objectives and, based on such evaluation, determine and approve,
either as a committee or together with the other independent directors (as
directed by the Board of Directors) the annual salary, bonus, stock
options and other benefits, direct and indirect, of the CEO and other
executive officers. In determining the long-term incentive component of
compensation for the CEO and other executive officers, the Committee
should consider Bristol West’s performance and relative shareholder
return, the value of similar incentive awards to CEOs and other executive
officers at comparable companies, and the awards given to Bristol West’s
CEO and other executive officers in past
years. |
4. |
In
connection with executive compensation
programs: |
(i) |
Review
and recommend to the full Board of Directors, or approve, new executive
compensation programs; |
(ii) |
Review
on a periodic basis the operations of Bristol West’s executive
compensation programs to determine whether they are properly coordinated
and achieving their intended purpose(s); |
(iii) |
Establish
and periodically review policies for the administration of executive
compensation programs; and |
(iv) |
Take
steps to modify any executive compensation program that yields payments
and benefits that are not reasonably related to executive and corporate
performance. |
5. |
Establish
and periodically review policies in the area of senior management
perquisites. |
6. |
Consider
policies and procedures pertaining to expense accounts of senior
executives. |
7. |
Review
and recommend to the full Board of Directors compensation of directors as
well as director’s and officer’s indemnification and insurance
matters. |
8. |
Review
and make recommendations to the full Board of Directors, or approve, any
contracts or other transactions with current or former executive officers
of Bristol West, including consulting arrangements, employment contracts,
severance or termination arrangements and loans to employees made or
guaranteed by Bristol West. |
|
arrangements,
employment contracts, severance or termination arrangements and loans to
employees made or guaranteed by Bristol
West. |
9. |
Review
and make recommendations to the Board of Directors with respect to Bristol
West’s incentive-compensation plans and equity-based plans, and oversee
the activities of the individuals responsible for administering those
plans. |
10. |
Review
and approve all equity compensation plans of Bristol West that are not
otherwise subject to the approval of Bristol West’s
shareholders. |
11. |
Review
and make recommendations to the full Board of Directors, or approve, all
awards of shares or share options pursuant to Bristol West’s equity-based
plans. |
12. |
Monitor
compliance by executives with the rules and guidelines of Bristol West’s
equity-based plans. |
13. |
Review
and monitor employee pension, profit sharing and benefit
plans. |
14. |
Select,
retain and/or replace, as needed, compensation and benefits consultants
and other outside consultants to provide independent advice to the
Committee. In that connection, in the event the Committee retains a
compensation consultant, the Committee shall have the sole authority to
approve such consultant’s fees and other retention
terms. |
15. |
Prepare
an annual report on executive compensation for inclusion in Bristol West’s
proxy statement, in accordance with applicable rules and regulations of
the NYSE, SEC and other applicable regulatory
bodies. |
16. |
Report
regularly to the Board of Directors (i)
following meetings of the Committee, (ii) with respect to such other
matters as are relevant to the Committee’s discharge of its
responsibilities and (iii) with respect to such recommendations as the
Committee may deem appropriate. The report to the Board of Directors may
take the form of an oral report by the Chairman or any other member of the
Committee designated by the Committee to make such
report. |
17. |
Maintain
minutes or other records of meetings and activities of the Committee.
|
1. |
Establish
criteria for the selection of new directors to serve on the Board of
Directors. |
2. |
Identify
individuals believed to be qualified as candidates to serve on the Board
of Directors and select, or recommend that the Board of Directors select,
the candidates for all directorships to be filled by the Board of
Directors or by the shareholders at an annual or special meeting. In
identifying candidates for membership on the Board of Directors, the
Committee shall take into account all factors it considers appropriate,
which may include (a) ensuring that the Board of Directors, as a
whole, is diverse and consists of individuals with various and relevant
career experience, relevant technical skills, industry knowledge and
experience, financial expertise (including expertise that could qualify a
director as a “financial expert,” as that term is defined by the rules of
the SEC), local or community ties and (b) minimum individual
qualifications, including strength of character, mature judgment,
familiarity with the company's business and industry, independence of
thought and an ability to work collegially. The Committee also may
consider the extent to which the candidate would fill a present need on
the Board of Directors.
Review
and make recommendations to the full Board of Directors, or determine,
whether members of the Board of Directors should stand for re-election.
Consider matters relating to the retirement of members of the Board of
Directors, including term limits or age limits.
|
3. |
Evaluate
candidates for nomination to the Board of Directors, including those
recommended by shareholders. In that connection, the Committee shall adopt
procedures for the submission of recommendations by shareholders as it
deems appropriate. |
4. |
Conduct
all necessary and appropriate inquiries into the backgrounds and
qualifications of possible candidates. |
5. |
Consider
questions of independence and possible conflicts of interest of members of
the Board of Directors and executive officers, and whether a candidate has
special interests or a specific agenda that would impair his or her
ability to effectively represent the interests of all
shareholders. |
6. |
Review
and make recommendations, as the Committee deems appropriate, regarding
the composition and size of the Board of Directors in order to ensure the
Board of Directors has the requisite expertise and its membership consists
of persons with sufficiently diverse and independent backgrounds.
|
7. |
Oversee
evaluation of, at least annually, and as circumstances otherwise dictate,
the Board of Directors and management. |
8. |
Recommend
members of the Board of Directors to serve on the committees of the Board
of Directors, giving consideration to the criteria for service on each
committee as set forth in the charter for such
|
|
committee,
as well as to any other factors the Committee deems relevant, and where
appropriate, make recommendations regarding the removal of any member of
any committee. |
9. |
Recommend
members of the Board of Directors to serve as the Chair of the committees
of the Board of Directors. |
10. |
Establish,
monitor and recommend the purpose, structure and operations of the various
committees of the Board of Directors, the qualifications and criteria for
membership on each committee of the Board of Directors and, as
circumstances dictate, make any recommendations regarding periodic
rotation of directors among the committees and impose any term limitations
of service on any committee of the Board of
Directors. |
11. |
Periodically
review the charter, composition and performance of each committee of the
Board of Directors and make recommendations to the Board of Directors for
the creation of additional committees or the elimination of committees of
the Board of Directors. |
12. |
Review
the adequacy of the certificate of incorporation and by-laws of the
corporation and recommend to the Board of Directors, as conditions
dictate, that it propose amendments to the certificate of incorporation
and by-laws for consideration by the shareholders.
|
13. |
Develop
and recommend to the Board of Directors a set of corporate governance
principles and keep abreast of developments with regard to corporate
governance to enable the Committee to make recommendations to the Board of
Directors in light of such developments as may be appropriate.
|
14. |
Review
policies relating to meetings of the Board of Directors. This may include
meeting schedules and locations, meeting agendas and procedures for
delivery of materials in advance of meetings.
|
15. |
Oversee
and approve the management continuity planning process. Review and
evaluate the succession plans relating to the CEO and other executive
officer positions and make recommendations to the Board of Directors with
respect to the selection of individuals to occupy these
positions. |
16. |
Report
regularly to the Board of Directors (i) following meetings of the
Committee, (ii) with respect to such other matters as are relevant to the
Committee’s discharge of its responsibilities and (iii) with respect to
such recommendations as the Committee may deem appropriate. The report to
the Board of Directors may take the form of an oral report by the Chairman
or any other member of the Committee designated by the Committee to make
such report. |
17. |
Maintain
minutes or other records of meetings and activities of the Committee.
|
1. |
SELECTION
OF DIRECTORS: |
FOR o WITHHOLD o EXCEPTIONS o
FOR
ALL
Nominees:
01-
James R. Fisher, 02-R. Cary Blair, 03-Richard T. Delaney, 04-Todd
A.
Fisher,
05-Perry Golkin, 06-Inder-Jeet S. Gujral, 07-Mary R.
Hennessy,
08-Eileen
Hilton, 09-James N. Meehan, 10-Scott C. Nuttall, 11-Arthur J.
Rothkopf
INSTRUCTIONS:
To withhold authority to vote for any individual
nominee,
mark the “Exceptions” box and write that nominee’s name
in
the
space provided below.
Exceptions
___________________________________________________
|
FOR AGAINST
ABSTAIN
o o o
2.
THE RATIFICATION OF THE SELECTION OF
DELOITTE & TOUCHE LLP as independent
auditor
for 2005.
To
change your address, please mark this box.
o
Attend
Annual Meeting mark here.
o
In
their discretion, the Proxies are authorized to vote upon all other
business that may
properly
come before the Meeting with all the powers the undersigned would possess
if
personally
present. |
|