UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14a INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
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[ ] Soliciting Material Pursuant to Section 240.14a-12
The Brink's Company
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(Name of Registrant as Specified In Its Charter)
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[BRINK'S LOGO] The Brink's Company
1801 Bayberry Court
P.O. Box 18100
Richmond, VA 23226-8100
MICHAEL T. DAN
Chairman,
President and Chief Executive Officer
March 26, 2004
To Our Shareholders:
You are cordially invited to attend the annual meeting of shareholders of
The Brink's Company to be held at the Hotel Inter-Continental The Barclay New
York, 111 East 48th Street, New York, New York, on Friday, May 7, 2004, at 1:00
p.m., local time.
You will be asked to: (i) elect three directors for a term of three years
and one director for a term of one year; (ii) approve independent public
accountants for 2004; (iii) approve a proposal to amend and restate the
Company's 1994 Employee Stock Purchase Plan; and (iv) approve a proposal to
amend the Company's Directors' Stock Accumulation Plan.
It is important that you vote, and we urge you to complete, sign, date and
return the enclosed proxy in the envelope provided.
We appreciate your prompt response and cooperation.
Sincerely,
MICHAEL DAN
[BRINK'S LOGO]
-------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 7, 2004
-------------------
Notice Is Hereby Given that the annual meeting of shareholders of THE
BRINK'S COMPANY will be held on May 7, 2004, at 1:00 p.m., local time, at the
Hotel Inter-Continental The Barclay New York, 111 East 48th Street, New York,
New York, for the following purposes:
1. To elect three directors for a term expiring in 2007 and one director for
a term expiring in 2005.
2. To approve the selection of KPMG LLP as independent public accountants to
audit the accounts of the Company and its subsidiaries for the year 2004.
3. To consider and act upon a proposal to amend and restate the Company's
1994 Employee Stock Purchase Plan as described in the attached Proxy Statement
and set forth as Exhibit A.
4. To consider and act upon a proposal to amend the Company's Directors'
Stock Accumulation Plan as described in the attached Proxy Statement and set
forth as Exhibit B.
5. To transact such other business as may properly come before the meeting
or any adjournment.
The close of business on March 15, 2004, has been fixed as the record date
for determining the shareholders entitled to notice of and to vote at the
meeting.
Whether or not you expect to attend the annual meeting in person, please
complete, date and sign the enclosed proxy and return it in the enclosed
envelope, which requires no additional postage if mailed in the United States.
We appreciate your prompt response.
Austin F. Reed
Secretary
March 26, 2004
The Annual Report to Shareholders, including financial statements, is being
mailed to shareholders, together with these proxy materials, commencing on or
about March 26, 2004.
YOUR VOTE IS IMPORTANT. PLEASE MARK, SIGN, DATE AND MAIL THE ENCLOSED PROXY CARD
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING. A RETURN ENVELOPE IS
ENCLOSED FOR YOUR CONVENIENCE.
THE BRINK'S COMPANY
PROXY STATEMENT
This Proxy Statement is furnished in connection with the solicitation by the
Board of Directors of The Brink's Company (the 'Company') of proxies from
holders of Brink's common stock (hereinafter 'Brink's Common Stock'), to be
voted at the annual meeting of shareholders to be held on May 7, 2004, at 1:00
p.m., local time, at the Hotel Inter-Continental The Barclay New York, 111 East
48th Street, New York, New York (and at any adjournment thereof), for the
purposes set forth in the accompanying notice of such meeting.
On May 2, 2003, the Company's shareholders approved the proposal to change
the Company's name to 'The Brink's Company.' On May 5, 2003, Brink's Common
Stock began trading on the New York Stock Exchange under the symbol 'BCO.'
The close of business on March 15, 2004, has been fixed as the record date
for determining the shareholders entitled to notice of and to vote at the annual
meeting, and only shareholders of record at the close of business on that date
will be entitled to vote at the meeting and any adjournment thereof. On March
15, 2004, the Company had outstanding 54,251,610 shares of Brink's Common Stock,
the holders thereof being entitled to one vote per share on all matters that the
Board of Directors knows will be presented for consideration at the annual
meeting.
This Proxy Statement and the accompanying form of proxy and Annual Report to
Shareholders are being mailed to shareholders commencing on or about March 26,
2004. The mailing address of the principal executive office of the Company is
1801 Bayberry Court, P.O. Box 18100, Richmond, VA 23226-8100.
The election of directors, the selection of independent public accountants,
the approval of the amendment and restatement of the 1994 Employee Stock
Purchase Plan and the approval of the amendment of the Directors' Stock
Accumulation Plan are the only matters that the Board of Directors knows will be
presented for consideration at the annual meeting. The shares of Brink's Common
Stock represented by proxies solicited by the Board of Directors will be voted
in accordance with the recommendations of the Board of Directors on these
matters unless otherwise specified in the proxy, and where the person solicited
specifies a choice with respect to any matter to be acted upon, the shares of
Brink's Common Stock will be voted in accordance with the specification so made.
As to any other business that may properly come before the annual meeting, it is
intended that proxies in the enclosed form will be voted in respect thereof in
accordance with the judgment of the person voting the proxies.
The Company's bylaws provide that the chairman of the annual meeting will
determine the order of business at the annual meeting and the voting and other
procedures to be observed. The chairman is authorized to declare whether any
business is properly brought before the annual meeting, and business not
properly brought before the annual meeting will not be transacted.
The enclosed proxy is revocable at any time prior to its being voted by
filing an instrument of revocation or a duly executed proxy bearing a later
date. A proxy may also be revoked by attendance at the annual meeting and voting
in person. Attendance at the annual meeting will not by itself constitute a
revocation.
Votes cast by shareholders will be treated as confidential in accordance
with a policy approved by the Board of Directors. Shareholder votes at the
annual meeting will be tabulated by the Company's transfer agent, EquiServe
Trust Company, N.A.
CORPORATE GOVERNANCE
BOARD OF DIRECTORS
The Board of Directors has the responsibility for establishing broad
corporate policies and for the overall performance of the Company, exercising
their good faith business judgment of the best interests of the Company. Members
of the Board are kept informed of the Company's business by various reports sent
to them regularly, as well as by operating and financial reports made at Board
and Committee meetings by the President and Chief Executive Officer and other
officers and members of management. During 2003, the Board met eight times.
AUDIT AND ETHICS COMMITTEE
The Audit and Ethics Committee (the 'Audit Committee'), established in
accordance with section 3(a)(58)(A) of the Securities Exchange Act of 1934, as
amended, recommends to the Board the selection by shareholders at their annual
meeting of a firm of independent public accountants, confers with the Company's
independent public accountants to review the plan and scope of their proposed
audit as well as their findings and recommendations upon the completion of the
audit, and meets with the independent public accountants and with appropriate
Company financial personnel and internal auditors regarding the Company's
internal controls, practices and procedures. The Audit Committee also oversees
the Company's legal and business ethics compliance programs. The Audit
Committee's Charter and the Company's Business Code of Ethics are attached as
Appendices A and B to this proxy statement. The Board has examined the
composition of the Audit Committee and found the members to meet the
independence requirements set forth in the listing standards of the New York
Stock Exchange. The Board of Directors has identified James R. Barker, Marc C.
Breslawsky, Ronald M. Gross and Carl S. Sloane as 'Audit Committee financial
experts' as that term is defined in the rules promulgated by the Securities and
Exchange Commission pursuant to the Sarbanes-Oxley Act of 2002. None of the
Company's Audit Committee members simultaneously serve on more than one other
public company audit committee. The Audit Committee currently consists of Mr.
Sloane, as Chairman, and Messrs. Barker, Breslawsky and Gross, none of whom is
an officer or employee of the Company or any of its subsidiaries. The Audit
Committee met six times during 2003.
The Audit Committee has adopted procedures for pre-approving certain
specific audit and non-audit services provided by the independent auditor. The
pre-approved services are described in detail under three categories: audit and
audit-related, tax services and agreed upon procedures. Requests for services
are reviewed by the Company's Legal Department and Finance Department to ensure
that they satisfy the requirements of the pre-approval policy. The Audit
Committee is provided a detailed update at each meeting as to independent
auditor engagements.
COMPENSATION AND BENEFITS COMMITTEE
The Compensation and Benefits Committee (the 'Compensation Committee') is
responsible for establishing and reviewing policies governing salaries,
incentive compensation and the terms and conditions of employment of senior
executives and other key employees of the Company, in addition to oversight of
the Company's stock option plans for employees and similar plans which may be
maintained from time to time by the Company. The Compensation Committee's
Charter is attached as Appendix C to this proxy statement. The Board has
examined the composition of the Compensation Committee and found the members to
meet the independence requirements set forth in the listing standards of the New
York Stock Exchange. The Compensation Committee currently consists of Mr.
Barker, as Chairman, and Messrs. Ackerman, Broadhead and Grinstein, none of whom
is an officer or employee of the Company or any of its subsidiaries. The
Compensation Committee met four times during 2003.
CORPORATE GOVERNANCE AND NOMINATING COMMITTEE
The Corporate Governance and Nominating Committee (the 'Corporate Governance
Committee') oversees the governance of the Company and recommends to the Board
nominees for election as
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directors and as senior executive officers of the Company, as well as reviewing
the performance of incumbent directors in determining whether to recommend them
to the Board for renomination. The Corporate Governance Committee's charter is
attached as Appendix D to this proxy statement. The Board has examined the
composition of the Corporate Governance Committee and found the members to meet
the independence requirements set forth in the listing standards of the New York
Stock Exchange. The Corporate Governance Committee currently consists of Mr.
Gross, as Chairman, Mrs. Alewine and Messrs. Grinstein and Turner, none of whom
is an officer or employee of the Company or any of its subsidiaries. The
Corporate Governance Committee met five times during 2003.
FINANCE COMMITTEE
The Finance Committee recommends to the Board dividend and other actions and
policies regarding the financial affairs of the Company, including those
relating to matters that may affect the financial strength of the Company. The
Finance Committee currently consists of Mr. Ackerman, as Chairman, and Messrs.
Breslawsky and Turner, none of whom is an officer or employee of the Company or
any of its subsidiaries. The Finance Committee met four times during 2003.
PENSION COMMITTEE
The Pension Committee is responsible for the oversight of the Company's
Pension-Retirement Plan and 401(k) Plan and any similar plans that may be
maintained from time to time by the Company. The Pension Committee also has
general oversight responsibility for pension plans maintained by foreign and
other subsidiaries of the Company. The Pension Committee has authority to adopt
amendments to the Company's Pension-Retirement Plan, Pension Equalization Plan
and 401(k) Plan. In carrying out these responsibilities, the Pension Committee
coordinates with the appropriate financial, legal and administrative personnel
of the Company, including the Company's Administrative Committee, as well as
outside experts retained in connection with the administration of those plans.
The Pension Committee currently consists of Mr. Broadhead, as Chairman, Mrs.
Alewine, and Mr. Sloane, none of whom is an officer or employee of the Company
or any of its subsidiaries. The Pension Committee met three times during 2003.
EXECUTIVE COMMITTEE
The Executive Committee of the Board may exercise substantially all the
authority of the Board during the intervals between the meetings of the Board.
The Executive Committee currently consists of Mr. Dan, as Chairman, and all
other directors, except that a quorum of the Executive Committee consists of
one-third of the number of members of the Executive Committee, three of whom
must not be employees of the Company or any of its subsidiaries. The Executive
Committee held no meetings in 2003.
EXECUTIVE SESSIONS OF THE BOARD OF DIRECTORS
The non-management members of the Board of Directors meet regularly without
management present. The Board of Directors has determined, as provided in the
Company's Corporate Governance Policies, that there is no need to designate a
lead outside director to chair their executive sessions. Each executive session,
or portion thereof, is chaired by the chairman of the Board committee that has
primary responsibility over the matter under discussion during the executive
session or portion thereof.
DIRECTOR ATTENDANCE AT MEETINGS
During 2003, all incumbent directors attended at least 75% of the total
number of meetings of the Board of Directors and of the committees of the Board
on which they served, and the average attendance at all meetings was
approximately 97%.
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Director Attendance at Annual Meeting
The Company has no policy with regard to Board members' attendance at annual
meetings. Eight of the eleven directors attended the 2003 annual meeting of
shareholders.
BOARD INDEPENDENCE
The Board of Directors has adopted as categorical standards the independence
requirements in the listing standards of the New York Stock Exchange to assist
it in making determinations of independence. All of the company's directors,
with the exception of Mr. Dan, who also serves as President and Chief Executive
Officer of the Company, meet these standards. For a director to be deemed
'independent,' the Board of Directors must affirmatively determine that the
director has no material relationship with the Company either directly or as a
partner, shareholder or officer of an organization that has a relationship with
the Company. In making this determination, the Board of Directors applies the
following standards:
1. A director who is an employee, or whose immediate family member is an
executive officer, of the Company, is not independent until three years
after the end of such employment relationship. Employment as an interim
Chairman or Chief Executive Officer will not disqualify a director from
being considered independent following such employment.
2. A director who receives (or whose immediate family member, serving as
an executive officer, receives) more than $100,000 per year in direct
compensation from the Company is not independent until three years after he
or she ceases to receive more than $100,000 per year in such compensation
(excluding director and committee fees and pensions or other forms of
deferred compensation for prior service, provided such compensation is not
contingent in any way on continued service). Compensation received by a
director for former service as an interim Chairman or Chief Executive
Officer will not count toward the $100,000 limitation.
3. A director who is affiliated with or employed by (or whose immediate
family member is affiliated with or employed by) a present or former
internal or external auditor of the Company is not independent until three
years after the end of either the affiliation or the employment or auditing
relationship.
4. A director who is employed (or whose immediate family member is
employed) as an executive officer of another company where any of the
Company's present executives serve on that company's compensation committee
is not independent until three years after the end of such service or
employment relationship.
5. A director who is an executive officer or an employee (or whose
immediate family member is an executive officer) of a company that makes
payments to, or receives payments from, the Company for property or services
in an amount which, in any single fiscal year, exceeds the greater of $1
million or 2% of such other company's consolidated gross revenues is not
independent until three years after falling below such threshold.
DIRECTOR NOMINATING PROCESS
The Company's Corporate Governance Policies contain information concerning
the responsibilities of the Corporate Governance Committee with respect to
identifying and evaluating the director candidates. The Corporate Governance
Policies are attached as Appendix E to this proxy statement. Both the Corporate
Governance Committee Charter and the Corporate Governance Policies are published
on the Company's Internet website at www.brinkscompany.com. All members of the
Corporate Governance Committee are independent as defined under the general
independence standards of the listing standards of the New York Stock Exchange.
The Corporate Governance Committee's charter provides that the Corporate
Governance Committee will consider director candidate recommendations by
shareholders. Shareholders should submit any such recommendations for the
Corporate Governance Committee through the method described under
'Communications with Non-Management Members of the Board of Directors' below. In
addition, in accordance with the Company's bylaws, any shareholder of record
entitled to vote for the
4
election of directors at the applicable meeting of shareholders may nominate
persons for election to the Board of Directors, if such shareholder complies
with the notice procedures set forth in the bylaws and summarized in the section
of this proxy statement entitled 'Other Information -- Shareholder Proposals.'
The Corporate Governance Committee evaluates all director candidates in
accordance with the director membership criteria described in the Corporate
Governance Policies. The Corporate Governance Committee evaluates any
candidate's qualifications to serve as a member of the Board based on the skills
and characteristics of individual Board members as well as the composition of
the Board as a whole. In addition, the Corporate Governance Committee will
evaluate a candidate's business experience, diversity, international background
and leadership capabilities, along with any other skills or experience which
would be of assistance to management in operating the Company's business. The
Company did not receive notice of a director candidate recommended by a
shareholder or group owning more than 5% of the Company's voting common stock
for at least one year as of the date of recommendation on or prior to November
29, 2003, the date that is 120 days before the anniversary of the prior year's
release of the proxy statement.
The Corporate Governance Committee utilizes several methods for identifying
and evaluating director nominees. The Corporate Governance Committee
periodically assesses whether any vacancies on the Board are expected due to
retirement or otherwise and, in the event that vacancies are anticipated, the
Committee considers possible director candidates. The Corporate Governance
Committee has utilized professional search firms to identify candidates based
upon the director membership criteria described in the Corporate Governance
Policies.
COMMUNICATIONS WITH NON-MANAGEMENT MEMBERS OF THE BOARD OF DIRECTORS
The Company's Corporate Governance Policies set forth a process by which
shareholders can send communications to the non-management members of the Board
of Directors. When interested third parties have concerns, they may make them
known to the non-management directors by communicating via written
correspondence sent U.S. mail c/o 'Executive Session Chairman' at the Company's
Richmond, Virginia address. All such correspondence is provided to the presiding
chairman at, or prior to, the next executive session held at a regular Board
meeting.
COMPENSATION OF DIRECTORS
Each non-employee director is paid an annual retainer fee of $32,500, an
attendance fee of $1,750 per day for each meeting of the Board and of each
committee of the Board, and a fee of $1,750 per day for rendering any special
services to the Company at the request of the Chairman of the Board. Each
Committee chairman receives an additional annual fee of $3,300. A director may
elect to defer receipt of his or her fees to future years and to receive
interest thereon, compounded quarterly, at the prime commercial lending rate of
J.P. Morgan Chase and Co., as of the end of the previous calendar quarter.
Under the terms of the Company's Directors' Stock Accumulation Plan, each
non-employee director receives, as of June 1 of each year, an allocation of
Units representing shares of Brink's Common Stock (the 'Units') equal to (a) 50%
of the annual retainer in effect on such June 1 if he or she has accrued less
than eight years of service or (b) 25% of such annual retainer if he or she has
accrued eight or more years of service, divided by the stock price for such
date. In addition, under the Directors' Stock Accumulation Plan, additional
Units are credited to participants' accounts in respect of cash dividends paid
on the Brink's Common Stock based upon the Directors' Stock Accumulation Plan's
formula for accrual. Upon a participant's termination of service, the
distribution of shares of Brink's Common Stock equal to the number of Units
allocated to such director's account will be made in a single lump sum
distribution unless the participant elects at least 12 months before his or her
termination to receive equal annual installments (not more than 10) commencing
on the first day of the month next following his or her termination of service.
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The following table sets forth information concerning the number of Units
credited during 2003 to each participant standing for election or continuing as
a director:
2003 UNITS
CREDITED
--------
Roger G. Ackerman........................................... 507.81
Betty C. Alewine............................................ 1,015.63
James R. Barker............................................. 507.81
Marc C. Breslawsky.......................................... 1,015.63
James L. Broadhead.......................................... 507.81
Gerald Grinstein............................................ 1,015.63
Ronald M. Gross............................................. 507.81
Carl S. Sloane.............................................. 1,015.63
Ronald L. Turner............................................ 1,015.63
All Non-Employee Nominees and Continuing Directors as a
Group (9 persons)......................................... 7,109.39
Under the Non-Employee Directors' Stock Option Plan (the 'Non-Employee
Directors' Stock Option Plan'), automatic annual grants of options are made for
2,517 shares of Brink's Common Stock at 100% of fair market value on the date of
grant to each non-employee director on each July 1 so long as the Non-Employee
Directors' Stock Option Plan remains in effect. Each option granted annually
will become exercisable six months from the date of grant. Each option granted
under the Non-Employee Directors' Stock Option Plan constitutes a nonqualified
stock option under the Internal Revenue Code of 1986, as amended (the 'Code'),
and terminates no later than ten years from the date of grant. The Non-Employee
Directors' Stock Option Plan expires May 11, 2008. The options are
nontransferable otherwise than by will or the laws of descent and distribution
except that options may be transferable to immediate family members (or trusts
therefor) of an optionee.
Under the Directors' Charitable Award Program, the Company will contribute
$1,100,000 on behalf of each participating director after such director's death.
Of that amount, $100,000 will be donated to one or more tax-exempt organizations
designated by the Company, and $1,000,000 will be donated in accordance with the
director's recommendations to eligible educational institutions and charitable
organizations. Each of the Company's directors currently participates in the
Directors' Charitable Award Program. The Company is the owner and beneficiary of
life insurance policies insuring the lives of the participating directors.
Premiums paid in 2003 in respect of such policies totaled in aggregate
approximately $464,000.
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ADDITIONAL INFORMATION
EXECUTIVE COMPENSATION
The following table sets forth information with respect to the compensation
of the Chief Executive Officer and the other four highest paid executive
officers of the Company:
SUMMARY COMPENSATION TABLE
ANNUAL LONG-TERM
COMPENSATION COMPENSATION
----------------------- ---------------------
NAME AND SECURITIES UNDERLYING ALL OTHER
PRINCIPAL POSITION YEAR SALARY(a) BONUS(b) OPTIONS COMPENSATION(b)
------------------ ---- --------- -------- ------- ---------------
M. T. Dan 2003 $915,846 $750,000 115,000 $21,762
Chairman, President and 2002 880,077 663,000 172,000 18,624
Chief Executive Officer 2001 832,692 318,750 170,000 12,776
R. T. Ritter 2003 $371,923 $250,000 25,000 $15,388
Vice President and 2002 346,154 200,000 40,000 14,791
Chief Financial Officer 2001 322,692 150,000 40,000 11,654
F. T. Lennon 2003 $325,200 $175,000 20,000 $17,216
Vice President -- 2002 310,900 150,000 30,000 14,944
Human Resources 2001 297,523 110,000 30,000 11,756
and Administration
A. F. Reed 2003 $325,200 $170,000 20,000 $14,441
Vice President, General 2002 311,169 140,000 30,000 12,926
Counsel and Secretary 2001 298,523 110,000 30,000 10,581
J. B. Hartough 2003 $240,677 $105,000 18,000 $13,530
Vice President -- 2002 236,800 163,000 20,000 19,013
Corporate Finance 2001 233,031 80,000 20,000 10,401
and Treasurer
(a) Salaries before compensation reduction payments under the 401(k) Plan and
the Deferral of Salary and Supplemental Savings Plan portions of the
Company's Key Employees' Deferred Compensation Program.
In addition, as of January 1, 2004, the participant's account was credited
with additional Common Stock Units in respect of cash dividends paid on
Brink's Common Stock during 2003 based upon the formula for accrual in the
Deferred Compensation Program. The following table sets forth the amount of
2003 salary deferred under the Deferred Compensation Program by each of the
executive officers named above and the number of Common Stock Units credited
to his account (including matching contributions and cash dividends) in
respect of salary paid in 2003:
2003 COMPENSATION COMMON STOCK
DEFERRED UNITS
-------- -----
Mr. Dan $228,961.57 13,859.78
Mr. Ritter 74,384.60 4,502.58
Mr. Lennon 97,560.02 5,905.50
Mr. Reed 65,040.01 3,937.00
Mr. Hartough 72,203.09 4,370.64
Under the Deferred Compensation Program, distributions with respect to the
Common Stock Units are to be made in shares of Brink's Common Stock on the
basis of one share for each Common Stock Unit (with cash paid for fractional
Common Stock Units), but the aggregate value of the shares so distributed
attributable to the deferral of salary pursuant to the Deferral of Salary
portion of the Program (including related dividends, but not matching
contributions) may not be less than the aggregate amount of the salary
deferred pursuant to the Deferral of Salary portion of the Program and the
related dividends in respect of which such Common Stock Units were initially
credited. Such distributions will be made upon termination of employment or
earlier upon election made more than one year prior to distribution.
(b) Under the Company's Key Employees' Deferred Compensation Program,
participants are permitted to defer up to 100% of the cash incentive payment
for 2003 made to them pursuant to the Key Employees Incentive Plan and
receive a Company-matching contribution with respect to the amount so
deferred but not in excess of 10% of the cash incentive payment, which
amounts were, as of January 1, 2004, converted into Common Stock Units in
accordance with the formula for conversion in the Deferred Compensation
Program. In addition, dividend credits of Common Stock Units were made to
the participant's accounts in respect of cash dividends paid on Brink's
Common Stock during 2003. The following table sets forth the aggregate
amount of incentive compensation for 2003 deferred under the Deferred
Compensation Program, including Company-matching contributions, by each of
the executive officers named above and the number of Common Stock Units
credited to his account (including in respect of cash dividends) as of
January 1, 2004:
2003 BONUS COMMON STOCK
DEFERRED UNITS
-------- -----
Mr. Dan $375,000 16,937.67
Mr. Ritter 50,000 2,258.36
Mr. Lennon 87,500 3,952.12
Mr. Reed 34,000 1,535.68
Mr. Hartough 32,000 1,445.35
(footnotes continued on next page)
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(footnotes continued from previous page)
Under the Deferred Compensation Program, distributions with respect to the
Common Stock Units are to be made in shares of Brink's Common Stock on the
basis of one share for each Common Stock Unit (with cash paid for fractional
Common Stock Units), but the aggregate value of the shares so distributed
attributable to the deferral of cash incentive payments (including related
dividends, but not matching contributions) may not be less than the aggregate
amount of the cash incentive payment deferred and the related dividends in
respect of which such Common Stock Units were initially credited. Such
distributions will be made upon termination of employment or earlier upon
election made more than one year prior to distribution.
(c) The Company made matching contributions under the 401(k) Plan in 2003 in the
amount of $10,000 for each of Messrs. Dan, Ritter, Reed and Lennon and
$9,852.30 for Mr. Hartough.
In 2003, the Company paid life insurance premiums under the Executive Salary
Continuation Plan in the amount of $11,761.96 for Mr. Dan; $5,388.48 for Mr.
Ritter; $7,216.00 for Mr. Lennon; $4,440.53 for Mr. Reed; and $3,677.30 for
Mr. Hartough. The Executive Salary Continuation Plan provides a death
benefit equal to three times a covered employee's annual salary payable in
ten equal annual installments to the employee's spouse or other designated
beneficiary.
8
STOCK OPTIONS
The following table sets forth information concerning nonqualified stock
options granted under the Company's 1988 Stock Option Plan on July 10, 2003, to
the Chief Executive Officer and the other officers named in the Summary
Compensation Table. Such options will (i) become exercisable as to one-third of
the total number of shares covered by such option on each of the first, second
and third anniversary of the date of grant; (ii) have purchase prices per share
equal to 100% of the fair market value of the Brink's Common Stock on the date
of grant, rounded up to the next higher cent; and (iii) expire on July 10, 2009.
No Stock Appreciation Rights were granted in 2003 to the named executive
officers.
OPTION GRANTS IN 2003
INDIVIDUAL GRANTS
NUMBER OF PERCENT OF
SECURITIES TOTAL OPTIONS EXERCISE
UNDERLYING GRANTED TO PRICE GRANT DATE
OPTIONS EMPLOYEES IN PER EXPIRATION PRESENT
NAME GRANTED 2003 SHARE DATE VALUE(a)
---- ------- ---- ----- ---- --------
M. T. Dan..................................... 115,000 19.03% $15.27 7/10/09 $631,465
R. T. Ritter.................................. 25,000 4.14% $15.27 7/10/09 137,275
F. T. Lennon.................................. 20,000 3.31% $15.27 7/10/09 109,820
A. F. Reed.................................... 20,000 3.31% $15.27 7/10/09 109,820
J. B. Hartough................................ 18,000 2.98% $15.27 7/10/09 98,838
---------
(a) Based on the Black-Scholes option-pricing model and the following
assumptions: (i) projected annual dividend yield of 0.54% for Brink's Common
Stock; (ii) expected volatility of 36.73%; (iii) a risk-free rate of return
of 2.98%; and (iv) all options are exercised on the expiration date. All
values vest at 33% per annum until fully vested, and were also discounted by
3% per year to reflect the risk of forfeiture before vesting. The actual
value an executive officer may receive depends on market prices and there
can be no assurance that the amounts reflected in the Grant Date Present
Value column will actually be realized. No gain to an executive officer is
possible without a commensurate appreciation in stock value.
The following table sets forth information concerning the exercise of
options during 2003 and unexercised options held at the end of such year.
AGGREGATED OPTION EXERCISES IN 2003
AND YEAR-END OPTION VALUES
STOCK OPTIONS
NUMBER OF
SECURITIES UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS AT IN-THE-MONEY OPTIONS AT
SHARES DECEMBER 31, 2003 DECEMBER 31, 2003
ACQUIRED ON VALUE --------------------------- ---------------------------
NAME EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- -------- -------- ----------- ------------- ----------- -------------
M. T. Dan............... 0 $ -- 565,636 286,332 $1,801,397 $1,048,085
R. T. Ritter............ 0 -- 116,149 64,999 342,296 230,998
F. T. Lennon............ 0 -- 96,936 50,000 286,114 182,500
A. F. Reed.............. 0 -- 96,936 50,000 286,114 182,500
J. B. Hartough.......... 1,867 1,045.52 56,675 37,999 141,761 156,199
PENSION-RETIREMENT PLAN
The Company maintains a noncontributory Pension-Retirement Plan (the
'Pension Plan') covering, generally, full-time employees of the Company and
participating subsidiaries who are not covered by a collective bargaining
agreement. Accrued benefits under the Pension Plan are vested upon employees'
completion of five years of Vesting Service (as defined in the Pension Plan).
The Code limits the amount of pensions which may be paid under federal income
tax qualified plans. The Board of Directors adopted a Pension Equalization Plan
(the 'Equalization Plan') under which the Company will make additional payments
so that the total amount received by each such person affected by the
9
Code limitations is the same as would have otherwise been received under the
Pension Plan. The Company has reserved the right to terminate or amend the
Pension Plan and the Equalization Plan at any time.
Effective December 1, 1997, the Equalization Plan was amended to permit
participants to receive the actuarial equivalent of their benefit under such
plan in a lump sum. By September 30, 2004, or earlier, upon a Change in Control
(as defined in the Equalization Plan), the Company is required to contribute
amounts in cash to a trust established between the Company and J.P. Morgan Chase
and Co. Such amounts are designed to be sufficient to provide the benefits to
which (a) participants under the Equalization Plan and (b) retirees covered
under certain employment contracts, are entitled pursuant to the terms of the
Equalization Plan and such employment contracts. The assets of the trust will be
subject to the claims of the Company's general creditors in the event of the
Company's insolvency.
The table below illustrates the estimated annual benefits payable upon
retirement at age 65 under the Pension Plan and Equalization Plan to officers
and other eligible employees in various classifications as to Average Salary and
years of Benefit Accrual Service (as defined in the Pension Plan for service
prior to June 1, 2003).
PENSION PLAN TABLE
ESTIMATED ANNUAL PENSION
AVERAGE ANNUAL SALARY PAYABLE BASED ON BENEFIT ACCRUAL SERVICE OF:
DURING 36 CONSECUTIVE ----------------------------------------------------
MONTHS OF HIGHEST PAY 10 YEARS 15 YEARS 20 YEARS 25 YEARS 30 YEARS
--------------------- -------- -------- -------- -------- --------
$ 300,000 $ 63,000 $ 94,500 $126,000 $157,500 $172,500
500,000 105,000 157,500 210,000 262,500 287,500
700,000 147,000 220,500 294,000 367,500 402,500
900,000 189,000 283,500 378,000 472,500 517,500
1,100,000 231,000 346,500 462,000 577,500 632,500
1,300,000 273,000 409,500 546,000 682,500 747,500
1,500,000 315,000 472,500 630,000 787,500 862,500
1,700,000 357,000 535,500 714,000 892,500 977,500
Effective June 1, 2003, the Pension Plan was amended to provide a lower accrual
rate for Benefit Accrual Service earned after June 1, 2003. In addition, the
Plan's Average Annual Salary definition was changed from 36 to 60 consecutive
months. At June 1, 2003, the executive officers named in such Table had been
credited under the Pension Plan with the following years of Benefit Accrual
Service: Mr. Dan, 21 years; Mr. Lennon, 26 years; Mr. Hartough, 16 years; Mr.
Reed, 16 years; and Mr. Ritter, 5 years. The table does not reflect reductions
on account of the applicable Social Security taxable wage base.
The table below illustrates the estimated annual benefits payable upon
retirement at age 65 under the Pension Plan and Equalization Plan to officers
and other eligible employees in various classifications as to Average Salary and
years of Benefit Accrual Service as defined in the Pension Plan (as amended
June 1, 2003).
PENSION PLAN TABLE
ESTIMATED ANNUAL PENSION
AVERAGE ANNUAL SALARY PAYABLE BASED ON BENEFIT ACCRUAL SERVICE OF:
DURING 60 CONSECUTIVE ----------------------------------------------------
MONTHS OF HIGHEST PAY 10 YEARS 15 YEARS 20 YEARS 25 YEARS 30 YEARS
--------------------- -------- -------- -------- -------- --------
$ 300,000 $ 52,500 $ 78,750 $105,000 $131,250 $146,250
500,000 87,500 131,250 175,000 218,750 243,750
700,000 122,500 183,750 245,000 306,250 341,250
900,000 157,500 236,250 315,000 393,750 438,750
1,100,000 192,500 288,750 385,000 481,250 536,250
1,300,000 227,500 341,250 455,000 568,750 633,750
1,500,000 262,500 393,750 525,000 656,250 731,250
1,700,000 297,500 446,250 595,000 743,750 828,750
10
Such amounts are based on the assumption that the employee will be in the
Company's employ until normal retirement date (age 65), that the Pension Plan
and Equalization Plan will continue in effect without change and that payments
will be made on a straight life annuity basis. The Pension Plan and Equalization
Plan give effect to the full amount of earnings shown under the salary and bonus
columns of the Summary Compensation Table. At December 31, 2003, the executive
officers named in such Table had been credited under the Pension Plan with one
year each of Benefit Accrual Service. The table does not reflect reductions on
account of the applicable Social Security taxable wage base.
EMPLOYMENT AGREEMENTS
As of May 4, 1998, the Company entered into an employment agreement with Mr.
Dan which, as amended as of March 8, 2002, provides him with, among other
things, a minimum annual salary of $884,000 for a period ending March 31, 2007,
in exchange for his services as President and Chief Executive Officer of the
Company. The agreement also provides certain benefits and obligations in the
event of a termination of his services during the contract term, including a
lump-sum cash payment equal to (i) his annual salary, as in effect immediately
prior to such termination, multiplied by three plus (ii) the bonus, if any paid
to him in respect of the immediately preceding fiscal year multiplied by three,
plus (iii) a sum reflecting the economic equivalent of certain employee benefit
programs.
CHANGE IN CONTROL ARRANGEMENTS
In 1997 and 1998, the Company entered into change-in-control agreements with
Messrs. Hartough, Lennon, Reed and Ritter. Pursuant to these agreements, in the
event Messrs. Hartough, Lennon, Reed or Ritter are terminated by the Company
without Cause (as defined in their respective agreements) or quit for Good
Reason (as defined in their respective agreements) within three years following
a Change-in-Control (as defined in their respective agreements), the terminated
executive will be entitled, in addition to other benefits, to a cash lump-sum
payment equal to (i) his accrued pay (including a prorated portion of his annual
bonus based on the number of days worked in the year of his termination) plus
(ii) three times the sum of his Annual Base Salary and Annual Bonus (as defined
in their respective agreements).
SEVERANCE AGREEMENTS
In 1997 and 1998, the Company entered into severance agreements with Messrs.
Hartough, Lennon, Reed and Ritter, which provide that if the executive is
terminated by the Company other than for Cause (as defined in such agreements)
or he quits for Good Reason (as defined in such agreements), the terminated
executive shall be entitled to receive, in addition to other benefits, (i) his
accrued pay (including a prorated portion of his annual bonus based on the
number of days worked in the year of his termination), (ii) three times the sum
of his annual base salary and Annual Bonus (as defined in such agreements) and
(iii) previously deferred compensation and related matching contributions
(whether or not vested).
11
EQUITY COMPENSATION PLAN INFORMATION
NUMBER OF SECURITIES REMAINING
NUMBER OF SECURITIES TO BE ISSUED WEIGHTED AVERAGE EXERCISE AVAILABLE FOR FUTURE ISSUANCE UNDER
PLAN CATEGORY UPON EXERCISE OF OUTSTANDING PRICE OF OUTSTANDING OPTIONS, EQUITY COMPENSATION PLANS (EXCLUDING
(SHARES IN MILLIONS) OPTIONS, WARRANTS AND RIGHTS WARRANTS AND RIGHTS SECURITIES REFLECTED IN COLUMN (A))
-------------------- --------------------------------- ----------------------------- ------------------------------------
(a) (b) (c)(1)
Equity compensation
plans approved by
security holders.... 4,046,996 $20.94 1,384,608
Equity compensation
plans not approved
by security
holders............. -- -- --
--------- ------ ---------
Total............ 4,046,996 $20.94 1,384,608
--------- ------ ---------
--------- ------ ---------
---------
(1) The Key Employees' Deferred Compensation Program of The Brink's Company, as
approved by shareholders, has no limit as to the number of securities
available for issuance. The Brink's Company Director's Stock Accumulation
Plan, as approved by shareholders, has 9,654 shares available for issuance
as of March 15, 2004.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and executive officers, and any persons who own more than 10% of a
registered class of the Company's equity securities, to file with the SEC and
the New York Stock Exchange reports of ownership and changes in ownership of
Common Stock and other equity securities of the Company. Officers, directors and
greater than 10% shareholders are required by SEC regulation to furnish the
Company with copies of all Section 16(a) forms they file. Based solely on a
review of the copies of such reports furnished to the Company or written
representations that no other reports were required, the Company believes that,
during 2003, with the exception of Forms 4 covering an automatic annual grant of
options filed on behalf of each of the outside directors on July 14, 2003, which
were submitted by the Company past the expiration of the SEC's two-day filing
requirement, its officers, directors and greater than 10% beneficial owners were
in compliance with all applicable filing requirements.
REPORT OF COMPENSATION AND BENEFITS COMMITTEE
The Compensation and Benefits Committee (the 'Compensation Committee') is
responsible for establishing and reviewing policies governing salaries,
incentive compensation, and the terms and conditions of employment of senior
executive officers and other key employees of the Company. The policies of the
Compensation Committee applicable to the compensation of executive officers of
the Company are described below.
The Compensation Committee has established an overall compensation program
to attract, retain and motivate executive officers and to enhance their
incentive to perform at the highest level and contribute significantly to the
Company's success. Recognizing the desirability of tying the compensation of
executive officers to performance and of aligning their interests closely to the
long-term interests of the Company and its shareholders, the Compensation
Committee has determined that a significant part of executive officers'
compensation will be paid in the form of incentive payments under the Key
Employees Incentive Plan ('KEIP') and the Management Performance Improvement
Plan ('MPIP'), as well as grants of stock options under the 1988 Stock Option
Plan.
The Compensation Committee has from time to time separately engaged
recognized consultants in the executive compensation field to review and confirm
the appropriateness of the Company's salary, annual bonus and long-term
incentive programs for executive officers. Cash compensation is paid to
executive officers, including the Chief Executive Officer (the 'CEO'), in the
form of salaries targeted at or near the 50th percentile, and annual incentive
payments under the KEIP. With advice from these consultants, the Compensation
Committee has developed a policy to make available to executive officers annual
incentive payments based on individual and Company performance which, when
coupled with salary, provide executive officers the opportunity to earn annual
cash compensation above the 50th
12
percentile for comparable positions in companies of similar size across all
industries from which the Company seeks to attract executive officers.
The Compensation Committee annually reviews the salaries of executive
officers in light of competitive standards and the Compensation Committee's
evaluation of their individual performance, and makes such adjustments as are
appropriate. Each year the Compensation Committee sets target cash incentive
awards for executive officers under the KEIP. Such target incentives are
indicative of the incentive payment that an executive officer might expect to
receive for such year based generally on a strong performance by the individual
executive officer in achieving established individual objectives, by his or her
operating or staff unit, and the overall performance of the Company. For
purposes of determining actual awards under such guidelines, individual
performance is given a weight factor of 50%, and unit and Company performance
are each given weight factors of 25%.
For 2003, the CEO had a target cash incentive award under the KEIP of 100%
of salary. Based on the KEIP guidelines, the CEO's actual award could have
ranged from 0 to 200% of salary, depending on the evaluation of his performance
and that of the Company as determined by the Compensation Committee and approved
by the Board. The Compensation Committee recommended and the Board approved an
annual incentive payment of $750,000 or 82% of salary for the CEO and annual
incentive payments for the other executive officers for 2003 after considering
the following quantitative and qualitative measures of the Company's performance
in 2003: (i) revenues, earnings and cash flow on a consolidated basis; (ii)
revenues, operating earnings and cash flow of each business unit; (iii) the
employee safety performance of each unit; (iv) changes in shareholder value as
measured by the market capitalization of the Company; and (v) increases in
economic value. The Compensation Committee also took into account as additional
factors and criteria: pricing and market conditions affecting each business
unit; the effect of the economy on such businesses; comparative performance of
the Company's competitors; productivity and cost containment measures
successfully carried out; progress of management development and employee
relations efforts; the quality of strategic planning, and communications with
external constituencies.
The Compensation Committee's evaluation of the CEO's and the other executive
officers' performance was based not only on the measures of the Company's
performance and the other factors and criteria described above, but also on the
Compensation Committee's good faith business judgment of their performance as it
related both as to results in 2003 and the long-term positioning of the Company.
The Compensation Committee did not attach specific weights to the foregoing
factors.
In 2003, the Compensation Committee made stock option grants to the
executive officers of the Company totaling 198,000 shares of The Brink's Company
Common Stock, including a grant to the CEO of 115,000 shares of The Brink's
Company Common Stock. The Compensation Committee's intent in making these grants
is to further align the interests of management and shareholders. Because the
2003 stock options were granted with exercise prices equal to 100% of market
value on the date of grant, executive officers will benefit from such stock
option grants only to the extent the stock price of The Brink's Company's Common
Stock appreciates above the exercise price. In addition, since such options
generally 'vest' only after periods ranging from one to three years from the
date of grant, they enhance the ability of the Company to retain executive
officers while encouraging such officers to take a longer-term view in their
decisions impacting the Company. Stock options, therefore, tie the compensation
of executive officers directly to the long-term performance of the Company.
As a further means to align the interests of management and shareholders,
effective January 1, 2000, the Board adopted, and the Company's shareholders
approved in May 2000, the Management Performance Improvement Plan. Participants
in the Management Performance Improvement Plan, including all of the executive
officers, have a substantial portion of their total compensation tied to the
achievement of financial goals established over three-year periods by the Board.
The Compensation Committee believes that reasonable severance and
post-takeover employment arrangements are often an essential aspect of the terms
of employment of executive officers. The Compensation Committee also recognizes
the importance to the Company of retaining its executive officers during and
after the disruption typically provoked by a takeover offer (whether or not
ultimately successful). The Company is party to a 'change in control' employment
agreement and a severance agreement or employment agreement with each of its
executive officers, and the
13
Compensation Committee is firmly of the view that the Company and its
shareholders have benefited from the protection which such agreements afford its
executive officers. The Compensation Committee believes that these employment
agreements provide reasonable compensation arrangements and give the Company a
high degree of management stability during a period of change.
Internal Revenue Code Section 162(m) disallows a tax deduction for any
publicly held corporation for paid remuneration exceeding $1 million in any
taxable year for chief executive officers and certain other executive officers,
except for performance-based remuneration. Historically, as reflected by the
design and implementation of the Company's compensation programs, the
Compensation Committee has sought, and continues to seek, the availability of
tax deductibility. This policy, however, is subject to the reservation by the
Compensation Committee of the flexibility to award non-deductible compensation
in circumstances wherein the Compensation Committee believes, in its good faith
business judgment, that such an award is in the best interest of the Company in
attracting or retaining capable management.
James R. Barker, Chairman
Roger G. Ackerman
James L. Broadhead
Gerald Grinstein
REPORT OF AUDIT AND ETHICS COMMITTEE
In compliance with the requirements of the New York Stock Exchange, the
Audit and Ethics Committee of The Brink's Company has an Audit and Ethics
Committee charter (the 'Charter'), outlining the functions and responsibilities
of the Audit and Ethics Committee. A copy of the Charter is attached as Appendix
A to this proxy statement and is available on the Company's website at
www.brinkscompany.com. In connection with those responsibilities, the Audit and
Ethics Committee has:
Reviewed and discussed the audited financial statements for the fiscal year
ended December 31, 2003 with management and KPMG LLP ('KPMG'), the
Company's independent auditors;
Discussed with KPMG the matters required to be discussed by Statement on
Auditing Standards No. 61 regarding required communication by external
auditors with audit committees; and
Received written disclosures and a letter from KPMG regarding KPMG's
independence as required by Independence Standards Board Standard No. 1 and
has discussed with KPMG its independence.
The Audit and Ethics Committee also considered, as it determined
appropriate, tax matters and other areas of financial reporting and the audit
process over which the Committee has oversight.
Based on the Audit and Ethics Committee's review and discussions described
above, the Audit and Ethics Committee recommended to the Board of Directors that
the audited financial statements be included in the Company's Annual Report on
Form 10-K for the fiscal year ended December 31, 2003 for filing with the SEC.
Carl S. Sloane, Chairman
James R. Barker
Marc C. Breslawsky
Ronald M. Gross
14
PERFORMANCE GRAPH
The following graph shows a five-year comparison of cumulative total returns
for the Brink's Common Stock (formerly Pittston Brink's Group Common Stock)
outstanding since December 31, 1998, through December 31, 2003, a composite
index of peer companies (the 'Custom Composite Index') selected by the Company
and the S&P MidCap 400 Index.
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN AMONG BRINK'S COMMON STOCK,
THE CUSTOM COMPOSITE INDEX, AND THE S&P MIDCAP 400 INDEX(1)
(YEAR ENDING DECEMBER 31)
[GRAPHIC]
31-DEC-98 31-DEC-99 14-JAN-00 31-DEC-00 31-DEC-01 31-DEC-02 31-DEC-03
The Brink's Company $100 $ 69 $ 69 $ 63 $ 70 $ 59 $ 73
Custom Composite Index $100 $ 93 $103 $ 92 $118 $124 $155
S&P MidCap 400 Index $100 $115 $116 $135 $134 $115 $155
---------
(1) As of December 31, 1998, the Company's common stock consisted of three
tracking stocks: Pittston Brink's Group Common Stock ('Brink's Stock'),
Pittston BAX Group Common Stock ('BAX Stock') and Pittston Minerals Group
Common Stock ('Minerals Stock'). On January 14, 2000, the Company completed
an exchange (the 'Exchange') of BAX Stock and Minerals Stock into Brink's
Stock, at exchange ratios of .4848 share of Brink's Stock for each share of
BAX Stock and .0817 share of Brink's Stock for each share of Minerals Stock.
As a result of the Exchange, the Company now has one class of common stock,
Brink's Common Stock, instead of three separate classes of common stock,
each of which was intended to track the performance of certain of the
Company's business units. For the line designated as 'Brink's Common Stock'
the graph depicts the cumulative return on $100 invested in Brink's Stock
until January 14, 2000 and, after such date, in Brink's Common Stock. For
the Custom Composite Index and the S&P MidCap 400 Index, cumulative returns
are measured on an annual basis for the periods from December 31, 1998
through December 31, 2003, with the value of each index set to $100 on
December 31, 1998. Total return assumes reinvestment of dividends. The
returns of the component companies included in the Custom Composite Index
are weighted according to such company's market capitalization at the
beginning of each period. Companies in the Custom Composite Index are as
follows: Airborne, Inc. (through second quarter 2003), Air Express
International Corporation (through 1/14/00), Arch Coal Inc., Burns
International Services Corp. (through second quarter 2000), Circle
International Group Inc. (through third quarter 2000), Expeditors
International Inc., FedEx Corp., Protection One Inc., Wackenhut Corporation
(Class A) (through first quarter 2002), and Westmoreland Coal Co. The
Company chose the S&P MidCap 400 Index because the Company is included in
this index which measures the performance of the mid-size company segment
of the United States market.
15
PROPOSALS OF THE BOARD
The following proposals are expected to be presented to the meeting. Holders
of Brink's Common Stock will have one vote per share.
PROPOSAL NO. 1 -- ELECTION OF DIRECTORS: in order to be elected, nominees
for director must receive a plurality of the votes cast by those present in
person or represented by proxy at the meeting and entitled to vote thereon.
Abstentions and shares held by a broker in 'street name' ('Brokers Shares') that
are not voted in the election of directors will not be included in determining
the number of votes cast.
PROPOSAL NO. 2 -- APPROVAL OF THE SELECTION OF INDEPENDENT PUBLIC
ACCOUNTANTS: must receive more votes cast in favor of such proposal by holders
of the shares present in person or represented by proxy at the meeting and
entitled to vote thereon than votes cast in opposition to such proposal by such
holders. Abstentions and Brokers Shares that are not voted on Proposal No. 2
will not be counted in determining the number of votes cast.
PROPOSAL NO. 3 -- APPROVAL OF AMENDMENT AND RESTATEMENT OF THE 1994
EMPLOYEE STOCK PURCHASE PLAN: must receive the affirmative vote of the holders
of a majority of the shares cast in favor of such proposal, provided that the
total vote cast on the proposal represents over 50 percent of the outstanding
shares. Abstentions will have the same affect as a vote against the proposal.
Absent voting instructions from a shareholder, a broker may or may not vote
Brokers Shares in its discretion depending on the proposals before the meeting.
Under the rules of the New York Stock Exchange, a broker may vote Brokers Shares
in its discretion on 'routine matters.' The Company believes that the election
of directors and the approval of the selection of independent public accountants
are routine matters on which brokers will be permitted to vote on behalf of
their clients if no voting instructions are furnished. Under the rules of the
New York Stock Exchange, however, a broker may not be able to vote on proposals
that are not considered 'routine.' When a proposal is not a routine matter and
the broker has not received voting instructions with respect to that proposal,
the broker cannot vote on that proposal. The Company believes that this proposal
is a non-routine matter. As such, Brokers Shares that are not voted on Proposal
No. 3 will have no effect on the proposal, provided that the total vote cast
represents over 50 percent of the outstanding shares.
PROPOSAL NO. 4 -- APPROVAL OF AMENDMENT OF THE DIRECTORS' STOCK
ACCUMULATION PLAN: must receive the affirmative vote of the holders of a
majority of the shares cast in favor of such proposal, provided that the total
vote cast on the proposal represents over 50 percent of the outstanding shares.
Abstentions will have the same affect as a vote against the proposal. The
Company believes that this proposal is a non-routine matter. Brokers Shares that
are not voted on Proposal No. 4 will have no effect on the proposal, provided
that the total vote cast represents over 50 percent of the outstanding shares.
16
PROPOSAL NO. 1 -- ELECTION OF DIRECTORS
In accordance with the Company's charter and bylaws, the Board of Directors
is divided into three classes, with the term of office of one of the three
classes of directors expiring each year and with each class being elected for a
three-year term.
The nominees for election as directors are: Mr. Gerald Grinstein for a
one-year term expiring in 2005; and Messrs. James R. Barker, James L. Broadhead
and Ronald L. Turner for a three-year term expiring in 2007.
Mr. Turner has been nominated to serve until 2007 in accordance with the
requirements of the Company's charter and bylaws that each of the classes be as
evenly divided as possible. Notwithstanding the Company's corporate governance
policy regarding director retirement age, Mr. Grinstein has been nominated by
the Board, in its good faith business judgment, to serve until 2005.
The Board of Directors has no reason to believe that any of the nominees are
not available or will not serve if elected. If any of them should become
unavailable to serve as a director, full discretion is reserved to the persons
named as proxies to vote for such other persons as may be properly nominated.
Set forth below is information concerning the age, principal occupation and
employment during the past five years, other directorships and positions with
the Company of each nominee and director, and the year in which he or she first
became a director of the Company.
NOMINEE FOR ELECTION AS DIRECTOR FOR
A ONE-YEAR TERM EXPIRING IN 2005
[Photo] GERALD GRINSTEIN, 71, is Chief Executive Officer of Delta Air
Lines, Inc., a commercial airline, and has held that
(2), (3), (4) position since January 2004. He also serves as a principal
in Madrona Investment Group LLC, a private investment firm,
and as strategic advisor for Madrona Venture Fund, a
Seattle-based venture fund. Mr. Grinstein is the retired
non-executive Chairman of Agilent Technologies, a
diversified technology company, and held that position from
August 1999 to November 2002. Mr. Grinstein served as
Chairman and Chief Executive Officer of Burlington Northern
Inc., until his retirement in 1995. From 1997-1999, Mr.
Grinstein served as non-executive Chairman of Delta Air
Lines, Inc. He is a director of Delta Air Lines, Inc.,
PACCAR Inc. and Vans, Inc. Mr. Grinstein has been a director
of the Company since 1998.
NOMINEES FOR ELECTION AS DIRECTORS FOR A THREE-YEAR TERM
EXPIRING IN 2007
[Photo] JAMES R. BARKER, 68, is Chairman of The Interlake Steamship
Co., vessel owners and operators of self unloaders, a
(1), (2), (4) position he has held since 1987. He is also Vice Chairman of
Mormac Marine Group, Inc, vessel owners of oil product
carriers, and Moran Towing Corporation, tug and barge owners
and operators. He is a director of Verizon Communications.
Mr. Barker has been a director of the Company since 1993.
17
[Photo] JAMES L. BROADHEAD, 68, is the retired Chairman and Chief
Executive Officer of FPL Group, Inc., a public utility
(2), (4), (6) holding company. He served as Chief Executive Officer and
Chairman of FPL Group, Inc. from 1989 and 1990,
respectively, until his retirement in December 2001. He is a
director of New York Life Insurance Company. Mr. Broadhead
has been a director of the Company since 1983.
[Photo] RONALD L. TURNER, 57, has been Chairman, President and Chief
Executive Officer of Ceridian Corporation since January
(3), (4), (5) 2000. Ceridian Corporation is an information services
company providing outsourcing services to the human
resources, transportation and retail markets, and operates
in the U.S., Canada and Europe. Mr. Turner served as Chief
Operating Officer of Ceridian from April 1998 to January
2000; Executive Vice President of Operations from March 1997
to April 1998; and has been a director of Ceridian since
July 1998. He is also a director of FLIR Systems, Inc. and
Imagistics, Inc. Mr. Turner has been a director of the
Company since 2002.
CONTINUING DIRECTORS
[Photo] ROGER G. ACKERMAN, 65, is the retired Chairman and Chief
Executive Officer of Corning Incorporated, a company engaged
(2), (4), (5) in specialty glass, ceramics and communications. He retired
as Chairman of the Board of Corning, Incorporated in June
2001. From 1996 through 2000, Mr. Ackerman served as Chief
Executive Officer of Corning, Incorporated, prior to which
he served as President and Chief Operating Officer from 1992
to 1996. He is a director of Massachusetts Mutual Life
Insurance Company. Mr. Ackerman has been a director of the
Company since 1991. His current term as a director of the
Company expires in 2006.
[Photo] BETTY C. ALEWINE, 55, is the retired President and Chief
Executive Officer of COMSAT Corporation, a provider of
(3), (4), (6) global satellite services and digital networking services
and technology. Mrs. Alewine served as President and Chief
Executive Officer of COMSAT from 1996 until August 2000,
when the company was acquired by Lockheed Martin
Corporation. She served as President of COMSAT's largest
operating unit from 1994 to 1996. She is a director of New
York Life Insurance Company and Rockwell Automation, Inc.
Mrs. Alewine has been a director of the Company since 2000.
Her current term as a director of the Company expires in
2006.
18
[Photo] MARC C. BRESLAWSKY, 61, is Chairman and Chief Executive
Officer of Imagistics International Inc., a company engaged
(1), (4), (5) in direct sales, service and marketing of enterprise office
imaging and document solutions, and has held that position
since 2001. From 1996 to 2001, he was President and Chief
Operating Officer of Pitney Bowes Inc., and Vice Chairman
from 1994 to 1996. Mr. Breslawsky is a director of
Imagistics International Inc., the United Illuminating
Company and C.R. Bard, Inc. He has been a director of the
Company since 1999. Mr. Breslawsky's current term as a
director of the Company expires in 2005.
[Photo] MICHAEL T. DAN, 53, is Chairman of the Board, President and
Chief Executive Officer of the Company. Prior to his
(4) election as President and Chief Executive Officer in
February 1998, Mr. Dan served as President and Chief
Executive Officer of Brink's Holding Company, Inc. be-
ginning in 1995 and President and Chief Executive Officer of
Brink's, Incorporated beginning in 1993. Mr. Dan has been a
director of the Company since 1998. His current term as a
director of the Company expires in 2005.
[Photo] RONALD M. GROSS, 70, is Chairman Emeritus of Rayonier Inc., a
global supplier of specialty pulps, timber and wood
(1), (3), (4) products, after retiring as Chairman and Chief Executive
Officer at the end of 1998. Mr. Gross was President and
Chief Operating Officer from 1978, when he joined Rayonier,
until 1981; President and Chief Executive Officer from 1981
to 1984; Chairman, President and Chief Executive Officer
from 1984 to 1996; and Chairman and Chief Executive Officer
from 1996 to 1998. He is a director of Rayonier Inc. and
Corn Products International, Inc. Mr. Gross has been a
director of the Company since 1995. His current term as a
director of the Company expires in 2005.
[Photo] CARL S. SLOANE, 67, is a private consultant and the Ernest L.
Arbuckle Professor of Business Administration, Emeritus at
(1), (4), (6) Harvard University, Graduate School of Business
Administration. From 1991 to 2000, he served as the Ernest
L. Arbuckle Professor of Business Administration at Harvard
University, Graduate School of Business Administration. He
is a director of Rayonier Inc. and MedSource Technologies,
Inc. Mr. Sloane has been a director of the Company since
1998. His current term as a director of the Company expires
in 2006.
---------
(1) Audit and Ethics Committee
(2) Compensation and Benefits Committee
(3) Corporate Governance and Nominating Committee
(4) Executive Committee
(5) Finance Committee
(6) Pension Committee
RECOMMENDATION OF THE BOARD
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE
FOR ALL NOMINEES FOR ELECTION AS DIRECTORS.
19
STOCK OWNERSHIP
Based in part on information furnished by each nominee, director and
executive officer named in the Summary Compensation Table, the number of shares
of Brink's Common Stock beneficially owned by them at January 31, 2004, was as
follows:
NAME OF INDIVIDUAL NUMBER OF SHARES
OR IDENTITY OF GROUP BENEFICIALLY OWNED(a) PERCENT OF CLASS*
-------------------- --------------------- ----------------
R. G. Ackerman.................................. 26,644(b)
B. C. Alewine................................... 13,452(b)
J. R. Barker.................................... 25,025(b)
M. C. Breslawsky................................ 27,997(b)
J. L. Broadhead................................. 25,312(b)
M. T. Dan....................................... 742,570(c) 1.37%
G. Grinstein.................................... 27,997(b)
R. M. Gross..................................... 35,324(b)
J. B. Hartough.................................. 111,981(c)
F. T. Lennon.................................... 176,414(c)
A. F. Reed...................................... 143,993(c)(d)
R. T. Ritter.................................... 169,588(c)
C. S. Sloane.................................... 29,193(b)
R. L. Turner.................................... 3,535(b)
14 nominees, directors and executive officers as
a group....................................... 1,559,005 2.87%
---------
* Except as otherwise noted, the named individuals have sole voting and
investment power with respect to such shares of Brink's Common Stock. None of
such individuals beneficially owns more than 1% of the outstanding Brink's
Common Stock, unless otherwise noted above.
(a) Includes shares of Brink's Common Stock which could be acquired within 60
days after January 31, 2004, upon the exercise of options granted pursuant
to the Company's stock option plans, as follows:
Mrs. Alewine............................................ 10,068
Mr. Dan................................................. 565,636
Mr. Gross............................................... 27,658
Mr. Hartough............................................ 56,675
Mr. Lennon.............................................. 96,936
Mr. Reed................................................ 96,936
Mr. Ritter.............................................. 116,149
Mr. Turner.............................................. 2,517
Each of Messrs. Ackerman, Barker and Broadhead.......... 17,381
Each of Messrs. Breslawksy, Grinstein and Sloane........ 23,913
All nominees, directors and executive officers as a
group
(14 persons)........................................... 1,096,457
(b) Includes Common Stock Units representing shares of Brink's Common Stock,
rounded to the nearest whole Common Stock Unit, credited to each Director's
account under the Company's Directors' Stock Accumulation Plan on or prior
to January 31, 2004, as follows:
Mr. Ackerman............................................ 5,288
Mrs. Alewine............................................ 3,384
Mr. Barker.............................................. 6,386
Mr. Broadhead........................................... 5,972
Mr. Gross............................................... 7,037
Mr. Sloane.............................................. 4,487
Mr. Turner.............................................. 1,018
Each of Messrs. Breslawsky and Grinstein................ 4,084
(footnotes continued on next page)
20
(footnotes continued from previous page)
(c) Includes Common Stock Units representing shares of Brink's Common Stock,
rounded to the nearest whole Common Stock Unit, credited to respective
accounts under the Company's Key Employees' Deferred Compensation Program
on or prior to January 31, 2004, as follows:
Mr. Dan................................................. 149,148
Mr. Hartough............................................ 33,231
Mr. Lennon.............................................. 58,066
Mr. Reed................................................ 37,803
Mr. Ritter.............................................. 42,794
Non-employee directors do not participate in the Company's Key Employees'
Deferred Compensation Program.
(d) Includes 102 shares of Brink's Common Stock held jointly by Mr. Reed with
his son, 222 shares of Brink's Common Stock held jointly by Mr. Reed with
his daughter, and 4,441 shares of Brink's Common Stock held jointly by Mr.
Reed with his wife.
The following table sets forth the only persons known to the Company to be
deemed beneficial owners of more than five percent of the outstanding Brink's
Common Stock as of the dates set forth in the footnotes to the table:
NAME AND ADDRESS OF NUMBER OF SHARES PERCENT
BENEFICIAL OWNER BENEFICIALLY OWNED OF CLASS
---------------- ------------------ --------
Barclays Global Investors, NA
Barclays Global Fund Advisors
45 Fremont Street
San Francisco, CA 94105................................. 3,220,670(a) 6.57%
MMI Investments, L.P.
MCM Management, LLC
152 West 57th Street
New York, NY 10019........................................ 2,906,500(b) 5.4%
Sterling Capital Management LLC
Sterling MGT, Inc.
Eduardo A. Brea
Alexander W. McAlister
David M. Ralston
Brian R. Walton
Mark Whalen
4064 Colony Road, Suite 300
Charlotte, NC 28211....................................... 3,385,479(c) 6.2%
---------
(a) According to a report on Schedule 13G dated February 13, 2004, filed with
the SEC by Barclays Global Investors, NA, ('Barclays'), a bank as defined
in the Securities Exchange Act of 1934, on behalf of itself and Barclays
Global Fund Advisors, an investment advisor registered under the Investment
Advisers Act of 1940 ('Barclays Advisors'), Barclays and Barclays Advisors
had sole voting power over 3,220,670 shares of Brink's Common Stock, shared
voting power over no shares of Brink's Common Stock, sole dispositive power
over 3,220,670 shares of Brink's Common Stock and shared dispositive power
over no shares of Brink's Common Stock, all of such shares being held in
trust accounts for the economic benefit of the beneficiaries of those
accounts.
(b) According to a report on Schedule 13D dated February 2, 2004, filed with
the SEC by MMI Investments, L.P. ('MMI'), a Delaware limited partnership
engaged primarily in the business of investing in publicly traded
securities, on behalf of itself and MCM Management, LLC, a Delaware limited
liability company that is the sole general partner of MMI and whose
principal business is investing in publicly traded securities ('MCM'), MMI
and MCM had sole voting power over 2,906,500 shares of Brink's Common
Stock, shared voting power over no shares of Brink's Common Stock, sole
dispositive power over 2,906,500 shares of Brink's Common Stock and shared
dispositive power over no shares of Brink's Common Stock.
(c) According to a report on Schedule 13G dated January 8, 2004, filed with the
SEC by Sterling Capital Management LLC ('Sterling'), an investment adviser
registered under the Investment Advisers Act of 1940, on behalf of itself,
Sterling MGT, Inc., the Manager of Sterling ('Sterling Management'), and
Messrs. Brea, McAlister, Ralston, Walton and Whalen, controlling
shareholders of Sterling Management, Sterling had, through such entities
and individuals, sole voting power over no shares of Brink's Common Stock,
shared voting power over 3,385,479 shares of Brink's Common Stock, sole
dispositive power over no shares of Brink's Common Stock and shared
dispositive power over 3,385,479 shares of Brink's Common Stock.
21
PROPOSAL NO. 2 -- APPROVAL OF THE SELECTION OF
INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors has, subject to shareholder approval, selected KPMG
as the Company's independent public accountants for the year 2004 and recommends
approval of such selection by the shareholders. KPMG served in this capacity for
the year 2003. One or more representatives of KPMG are expected to attend the
annual meeting and will have the opportunity to make a statement if they desire
to do so and are expected to be available to respond to appropriate questions.
FEES PAID TO KPMG
The following table lists fees billed by KPMG for services rendered in
fiscal years 2002 and 2003. Certain amounts for fiscal year 2002 have been
reclassified to conform to the fiscal year 2003 presentation.
2003 2002
---- ----
(IN THOUSANDS)
Audit Fees.................................................. $4,335 $3,669
Audit-Related Fees.......................................... 500 487
Tax Fees.................................................... 472 1,226
All Other Fees.............................................. -- --
------ ------
Total Fees.............................................. $5,307 $5,201
------ ------
------ ------
AUDIT FEES are primarily for professional services provided in connection
with the audit of the Company's financial statements and review of quarterly
consolidated financial statements, advice on accounting matters that arose
during the audit and audit services provided in connection with other statutory
or regulatory filings.
AUDIT RELATED FEES primarily include fees for assurance services that are
reasonably related to the audit of the Company's consolidated financial
statements and for services in connection with audits of the Company's pension
and other employee benefit plans.
TAX FEES primarily include fees associated with tax compliance and tax
advice, as well as domestic and international tax planning. This category also
includes tax planning on mergers and acquisitions and restructurings, as well as
other services related to tax disclosure and filing requirements.
ALL OTHER FEES are primarily for services provided to the Company not
otherwise included in the categories above.
CONSIDERATION OF AUDITOR INDEPENDENCE
The Audit Committee has concluded that the provision of the non-audit
services by KPMG is compatible with maintaining their independence.
RECOMMENDATION OF THE BOARD
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE
FOR THE APPROVAL OF THE INDEPENDENT PUBLIC ACCOUNTANTS.
-------------------
PROPOSAL NO. 3 -- APPROVAL OF AMENDMENT AND RESTATEMENT
OF THE COMPANY'S 1994 EMPLOYEE STOCK PURCHASE PLAN
The purpose of the 1994 Employee Stock Purchase Plan of The Brink's Company,
as amended (the 'Plan'), is to encourage employees of the Company at all levels
to acquire a proprietary interest in the Company in the form of shares of its
Common Stock ('Brink's Shares'). It is intended that this proprietary interest
will provide employees incentive to further the best interests of the Company
and its shareholders.
22
Under the Plan, a total of 984,905 Brink's Shares may be sold. As of March
15, 2004, a total of 920,987 Brink's Shares had been issued under the Plan,
leaving 63,918 Brink's Shares still available for issuance under the Plan. Also,
subsequent to the most recent shareholder action with respect to the Plan in
1999, the Board of Directors from time to time has approved amendments to the
Plan, including amendments to reflect the elimination of the tracking stock
structure, clarify when employees become beneficial owners of shares purchased
under the Plan, reflect new listing arrangements, extend the Plan's term through
June 30, 2007, eliminate the six month waiting period for employee participation
and change the name of the Plan to reflect the Company's new name.
In these circumstances and having regard for the Company's practice of
encouraging employee interest in the Company, the Board of Directors has after
careful review concluded unanimously that, in light of the continued interest of
employees in investing in Brink's Shares, it is in the best interest of the
Company and its shareholders to have the shareholders approve an amended and
restated Plan, which shall include: (i) the increase in the maximum number of
Brink's Shares which may be issued under the Plan by 500,000 shares, (ii) the
extension of the term of the Plan to June 30, 2010 and (iii) the approval and
ratification of the Board's amendments to the Plan described in the preceding
paragraph. The Board has therefore adopted, subject to shareholder approval, the
amended and restated Plan in the form set forth on Exhibit A to this proxy
statement. Set forth below is a summary of the Plan as it is proposed to be
amended and restated.
Summary of the Plan. The Plan is intended to qualify as an 'employee stock
purchase plan' pursuant to Section 423 of the Code. The offering periods of the
Plan have a duration of six months, commencing on July 1 and January 1 of each
year. The Plan is administered by a committee designated by the Board (the
'Committee'). The Committee is authorized to interpret the Plan and may from
time to time adopt such rules and regulations for carrying out the Plan as it
deems advisable. Any determinations of and all related orders or resolutions by
the Committee or the Board, pursuant to the provisions of the Plan, are final,
conclusive and binding on all persons. A total of 563,918 Brink's Shares may be
sold under the Plan on or after May 7, 2004.
In general, each employee of the Company and any designated subsidiary
('Subsidiary') is eligible to participate in the Plan if he or she is
customarily employed at least twenty hours per week; provided, however, that (i)
an employee who is covered by a collective bargaining agreement shall only be
eligible to participate if the collective bargaining unit representing such
individual accepts the Plan on behalf of the employees in such unit and (ii)
individuals holding 5% or more of the total combined voting power or value of
Brink's Shares or of any Subsidiary (directly or upon the exercise of options)
may not continue to purchase additional Brink's Shares.
An eligible employee may elect to participate by filing an enrollment form
with the Committee, not less than ten business days prior to the commencement of
an offering period, authorizing payroll deductions from 1% to 10% of the
employee's compensation (not to exceed $12,750 per calendar year). Such payroll
deductions are allocated to purchase Brink's Shares at a price equal to 85% of
the fair market value of such Brink's Shares on either the first or last day of
each offering period, whichever purchase price is less. No interest accrues on
any such payroll deductions. A participant may generally reduce the rate of
payroll deductions once during each offering period and shall automatically
participate in each successive offering period until the time such participant
elects to cease participation in the Plan. In addition, the right to purchase
Brink's Shares under the Plan may not accrue at a rate that exceeds $25,000 in
the fair market value of Brink's Shares in any calendar year determined at the
time or times such rights are granted.
Participation in the Plan ends upon notification of cessation of
participation to the Company by the participant at any time up to the end of an
offering period or automatically upon termination of employment with the
Company. An employee may not transfer, assign or otherwise encumber his or her
rights under the Plan, other than by will or the applicable laws of descent, and
any such attempt shall be deemed to constitute cessation of participation in the
Plan.
Adjustments Upon Changes in Capitalization; Corporate Transactions. In the
event of any dividend payable in Brink's Shares or any split or combination of
Brink's Shares, (a) the number of shares of such class which may be issued under
the Plan shall be proportionately increased or decreased, as the case may be,
(b) the number of shares (including shares subject to rights to purchase which
have not been
23
exercised) thereafter deliverable shall be proportionately increased or
decreased, as the case may be, and (c) the aggregate purchase price shall not be
changed. In the event of any other recapitalization, reorganization,
extraordinary dividend or distribution or restructuring transaction (including
any distribution of shares of stock of any Subsidiary or other property to
holders of Brink's Shares) affecting Brink's Shares, the number of shares
issuable under the Plan shall be subject to such adjustment as the Committee or
the Board of Directors may deem appropriate, and the number of shares thereafter
deliverable (including shares subject to rights to purchase which have not been
exercised) and/or the purchase price shall be subject to such adjustment as the
Committee or the Board of Directors may deem appropriate. In the event of a
merger or share exchange in which the Company will not survive as an
independent, publicly owned corporation, or in the event of a consolidation or
of a sale of all or substantially all of the Company's assets, provision shall
be made for the protection and continuation of any outstanding rights to
purchase by the substitution, on an equitable basis, of such shares of stock,
other securities, cash, or any combination thereof, as shall be appropriate.
Term, Amendment and Termination of the Plan. The Plan shall terminate on
June 30, 2010, unless the Company's shareholders approve its extension. The
Board may at any time and from time to time amend, modify or terminate the Plan,
but no such amendment or modification without the approval of the shareholders
shall: (a) increase the maximum number of shares of Brink's Shares which may be
issued under the Plan; (b) permit the issuance of any shares of Brink's Shares
at a purchase price less than that provided in the Plan as approved by the
shareholders; (c) extend the term of the Plan; or (d) cause the Plan to fail to
meet the requirements of an 'employee stock purchase plan' under Section 423 of
the Code.
The benefits or amounts that will be received by or allocated to
participants cannot be determined at this time because virtually all employees
will be eligible to participate with the benefit to each participant depending
on the extent of his or her authorized payroll deduction, his or her election to
purchase Brink's Shares, and the future market prices of Brink's Shares.
RECOMMENDATION OF THE BOARD
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE
FOR THE APPROVAL OF THE AMENDMENT AND RESTATEMENT
OF THE COMPANY'S 1994 EMPLOYEE STOCK PURCHASE PLAN.
-------------------
PROPOSAL NO. 4 -- APPROVAL OF AMENDMENT
OF THE COMPANY'S DIRECTORS' STOCK ACCUMULATION PLAN.
The Board of Directors has adopted unanimously, subject to the approval of
shareholders, an amendment of The Brink's Company Directors' Stock Accumulation
Plan (the 'Plan'), set forth on Exhibit B to this proxy statement, to increase
by 100,000 the maximum number of shares of the Company's Common Stock that may
be issued under the Plan. The Plan assists the Company in recruiting and
retaining individuals of ability and experience who are not employed by the
Company to serve on the Board and its committees. The Board believes that the
Plan aligns participants' interests with those of the Company's shareholders by
providing a vehicle for non-employee directors to participate in the growth and
performance of the Company. The Board, therefore, unanimously recommends that
the shareholders approve the amendment.
Under the terms of the Plan, each non-employee director receives, as of June
1 of each year, an allocation of deferred stock equivalent units representing
shares of the Company's Common Stock (the 'Units') equal to (a) 50% of the
annual retainer in effect on such June 1 (currently $32,500) if he or she has
accrued less than eight years of service or (b) 25% of such annual retainer if
he or she has accrued eight or more years of service, divided by the stock price
on such date. Additional Units are credited to participants' accounts in respect
of cash dividends paid on the Company's Common Stock based upon the Plan's
formula for accrual. A participant who completes at least five years of service
as a non-employee director is entitled to receive, following his or her
retirement or death while serving as a non-employee director, a single lump sum
distribution of the number of shares of the Company's Common
24
Stock equal to the number of Units allocated to such director's account. A
participant may also elect to receive up to ten equal annual installments of
such shares commencing on the first day of the month next following his or her
termination of service. In the event of an increase in a participant's annual
retainer, the number of Units in each participant's account shall be increased
by multiplying the number of Units by the ratio of the amount of the annual
retainer after the increase to the amount of such retainer immediately prior to
the increase. The Plan will expire on May 15, 2014, unless it is extended by the
Company's shareholders.
Currently, there are nine non-employee directors who are participants in the
Plan. Since shareholder approval of the Plan in 1996, 62,597 Units have been
allocated to participants under the Plan, with 9,654 Units available to be
allocated as of March 15, 2004. Under the proposed amendment of the Plan,
100,000 additional Units would be available for allocation under the Plan,
resulting in a total of 109,654 Units being available for allocation under the
Plan. The closing price of a share of the Company's Common Stock on the New York
Stock Exchange on March 15, 2004 was $24.58.
Any amounts allocated to a participant under the Plan are not taxable for
federal income tax purposes until he or she receives the related shares of the
Company's Common Stock. At that time, the fair market value of such shares (and
any cash distributed in lieu of fractional shares) will be taxed as ordinary
income to the recipient and the Company will be entitled to a corresponding tax
deduction.
RECOMMENDATION OF THE BOARD
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE
FOR THE APPROVAL OF THE AMENDMENT OF
THE COMPANY'S DIRECTORS' STOCK ACCUMULATION PLAN.
-------------------
OTHER INFORMATION
SHAREHOLDER PROPOSALS
To nominate a director at the annual meeting, a shareholder must satisfy
conditions specified in the Company's bylaws. A shareholder who wishes to
suggest potential nominees to the Board of Directors for consideration should
write to the Secretary of the Company, stating in detail the qualifications of
such nominees for consideration by the Corporate Governance Committee of the
Board. The Company's bylaws also prescribe the procedures a shareholder must
follow to bring other business before annual meetings. For a shareholder to
nominate a director or directors at the 2005 annual meeting or bring other
business (including any proposal intended for inclusion in the Company's proxy
materials) before the 2005 annual meeting, notice must be given to the Secretary
of the Company between September 27, 2004, and November 26, 2004, inclusive. The
notice must include a description of the proposed business, the reason for it,
the complete text of any resolution and other specified matters.
Any shareholder desiring a copy of the Company's bylaws will be furnished
one without charge upon written request to the Secretary.
OTHER MATTERS
The cost of this solicitation of proxies will be borne by the Company. In
addition to soliciting proxies by mail, directors, officers and employees of the
Company, without receiving additional compensation therefor, may solicit proxies
by telephone, facsimile, electronic mail, telegram, in person or by other means.
Arrangements also will be made with brokerage firms and other custodians,
nominees and fiduciaries to forward proxy solicitation material to the
beneficial owners of Brink's Common Stock held of record by such persons and the
Company will reimburse such brokerage firms, custodians, nominees and
fiduciaries for reasonable out-of-pocket expenses incurred by them in connection
therewith. The Company has retained Georgeson Shareholder Communications Inc. to
perform various proxy advisory and solicitation services. The fee of Georgeson
Shareholder Communications Inc. in connection with the 2004 annual meeting is
currently estimated to be approximately $15,000, plus reimbursement of
out-of-pocket expenses.
AUSTIN F. REED
Secretary
March 26, 2004
25
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EXHIBIT A
1994 EMPLOYEE STOCK PURCHASE PLAN
OF
THE BRINK'S COMPANY
(As Amended and Restated as of March 12, 2004)
ARTICLE I
Purpose of the Plan
The 1994 Employee Stock Purchase Plan of The Brink's Company (the 'Plan'),
as amended and restated as of March 12, 2004, is a continuation and improvement
of the Plan as in effect immediately prior to such date. The Plan enables
eligible employees of the Company and its Subsidiaries to purchase through
regular payroll deductions shares of common stock of The Brink's Company. The
Company intends this Plan to encourage such employees to acquire a proprietary
interest in the Company with a view toward further identifying their interests
with those of other shareholders of the Company. The Plan is intended to qualify
as an 'employee stock purchase plan' under Section 423 of the Internal Revenue
Code.
ARTICLE II
Definitions
Section 1. Wherever used in the Plan, the following terms shall have the
meanings indicated:
Board: The Board of Directors of the Company.
Code: The Internal Revenue Code of 1986, as amended.
Committee: The committee designated by the Board to administer the Plan in
accordance with Section 1 of Article III. Until otherwise determined by the
Board, the Administrative Committee designated by the Board shall be the
Committee under the Plan.
Common Stock: The Brink's Company Common Stock, par value $1.00 per share.
Such shares of Common Stock of the Company shall be subject to such terms,
conditions and restrictions, including without limitations, restrictions on
resale of such shares for a specified period of time, as shall be determined by
the Committee.
Company: The Brink's Company.
Compensation: The annual base rate of pay of a Participant, including
commissions but excluding, unless otherwise determined by the Committee in
accordance with nondiscriminatory rules adopted by it, overtime or premium pay.
Dividend Date: The date on which a cash dividend on Common Stock is paid.
Eligible Employee: Any employee of the Company or a Subsidiary who is
customarily employed for at least 20 hours per week; provided, however, that in
the case of an employee who is covered by a collective bargaining agreement, he
or she shall not be considered an Eligible Employee unless and until the labor
organization representing such individual has accepted the Plan on behalf of the
employees in the collective bargaining unit. Any such employee shall continue to
be an Eligible Employee during an approved leave of absence provided such
employee's right to continue employment with the Company or a Subsidiary upon
expiration of such employee's leave of absence is guaranteed either by statute
or by contract with, or a policy of, the Company or a Subsidiary.
Fair Market Value: With respect to shares of Common Stock, the average of
the high and low quoted sale prices (including any sale prices determined on a
when issued basis) of a share of such stock on the applicable Offering Date,
Purchase Date, Dividend Date or other date specified herein, as the case may be,
as reported on the New York Stock Exchange Composite Transactions Tape; provided
that (a) if on such Offering Date, Dividend Date or any other date other than
the Purchase Date, there is no
A-1
reported sale transaction on the New York Stock Exchange Composite Transactions
Tape, Fair Market Value shall be determined on the first subsequent date on
which such a transaction shall have occurred, and (b) if on such Purchase Date
there is no such transaction, Fair Market Value shall be determined on the last
preceding date on which such a transaction shall have occurred.
Offering Date: The first day of each six-month period commencing on July 1
or January 1 on and after July 1, 1994.
Offering Period: With respect to each Participant, the six-month period from
an Offering Date to and including the next following Purchase Date.
Participant: An Eligible Employee who elects to participate in the Plan on
an Offering Date in accordance with the provisions of the Plan. All Participants
shall have the same rights and privileges except as otherwise permitted by
Section 423 of the Code and the Plan.
Plan Cash Account: The cash account maintained by the Company on its books
for each Participant pursuant to the Plan.
Purchase Date: The last day of each six-month Offering Period.
Purchase Price: The price at which Participants may purchase shares of
Common Stock in accordance with the Plan.
Stock Account: The stock account consisting of shares of Common Stock
maintained by a recordkeeper selected by the Company for each Participant
pursuant to the Plan.
Subsidiary: A subsidiary corporation, as defined in Section 424 of the Code,
which is designated by the Committee as a Subsidiary for purposes of the Plan.
ARTICLE III
Administration
Section 1. Subject to the authority of the Board as described herein, the
Plan shall be administered by a committee designated by the Board, which shall
be composed of at least three members. The Committee is authorized to interpret
the Plan and may from time to time adopt such rules and regulations for carrying
out the Plan as it deems best. All determinations by the Committee shall be made
by the affirmative vote of a majority of its members, but any determination
reduced to writing and signed by a majority of its members shall be fully as
effective as if it had been made by a majority vote at a meeting duly called and
held. Subject to any applicable provisions of the Company's bylaws or of the
Plan, all determinations by the Committee or the Board pursuant to the
provisions of the Plan, and all related orders or resolutions of the Committee
or the Board, shall be final, conclusive and binding on all persons, including
the Company and its shareholders and Eligible Employees and Participants under
the Plan.
Section 2. All authority of the Committee provided for in, or pursuant to,
this Plan, including that referred to in Section 1 of this Article III, may also
be exercised by the Board. In the event of any conflict or inconsistency between
determinations, orders, resolutions or other actions of the Committee and the
Board taken in connection with this Plan, the actions of the Board shall
control.
ARTICLE IV
Number of Shares To Be Offered
Section 1. Subject to the provisions of Section 2 of this Article IV, the
maximum number of shares of Common Stock which may be issued or allocated
pursuant to the Plan on or after May 7, 2004 shall be 563,918 shares of Common
Stock.
Section 2. In the event of any dividend payable in Common Stock or any split
or combination of Common Stock, (a) the number of shares which may be issued
under this Plan shall be proportionately increased or decreased, as the case may
be, (b) the number of shares (including shares subject to rights to purchase
which have not been exercised) thereafter deliverable shall be proportionately
increased or
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decreased, as the case may be, and (c) the aggregate Purchase Price shall not be
changed. In the event of any other recapitalization, reorganization,
extraordinary dividend or distribution or restructuring transaction (including
any distribution of shares of stock of any Subsidiary or other property to
holders of shares of Common Stock) affecting Common Stock, the number of shares
issuable under this Plan shall be subject to such adjustment as the Committee or
the Board may deem appropriate, and the number of shares thereafter deliverable
(including shares subject to rights to purchase which have not been exercised)
and/or the Purchase Price shall be subject to such adjustment as the Committee
or the Board may deem appropriate. In the event of a merger or share exchange in
which the Company will not survive as an independent, publicly owned
corporation, or in the event of a consolidation or of a sale of all or
substantially all of the Company's assets, provision shall be made for the
protection and continuation of any outstanding rights to purchase by the
substitution, on an equitable basis, of such shares of stock, other securities,
cash, or any combination thereof, as shall be appropriate.
ARTICLE V
Eligibility and Participation
Section 1. An Eligible Employee who shall have satisfied all eligibility
requirements on or before any Offering Date may become a Participant for the
Offering Period commencing on such Offering Date by filing with the office or
offices designated by the Committee an enrollment form prescribed by the
Committee authorizing payroll deductions not less than ten business days prior
to such Offering Date. By enrolling in the Plan, a Participant shall be deemed
to elect to purchase the maximum number of whole shares of Common Stock that can
be purchased with the amount of the Participant's Compensation which is withheld
during the Offering Period.
Section 2. A Participant shall automatically participate in each successive
Offering Period until the time of such Participant's withdrawal from the Plan as
hereinafter provided. A Participant shall not be required to file any additional
enrollment forms for any such successive Offering Period in order to continue
participation in the Plan.
Section 3. Each Participant shall designate on the enrollment form the
percentage of Compensation which he or she elects to have withheld for the
purchase of Common Stock, which may be any whole percentage from 1% up to and
including 10% of such Participant's Compensation (up to a maximum of $12,750 per
calendar year); provided, however, that in no event shall the amount withheld
during an Offering Period exceed 50% of such Participant's Compensation
determined on the Offering Date. A Participant may reduce (but not increase) the
rate of payroll withholding during an Offering Period by filing with the
Committee a form to be prescribed by it, at any time prior to the end of such
Offering Period for which such reduction is to be effective. Not more than one
reduction may be made in any Offering Period unless otherwise determined by
nondiscriminatory rules adopted by the Committee. A Participant may increase or
decrease the rate of payroll deduction for any subsequent Offering Period by
filing, at the appropriate office provided for in Section 1 of this Article V, a
new authorization for payroll deductions not less than ten business days prior
to the Offering Date for such subsequent Offering Period.
Section 4. The Purchase Price for each share of Common Stock to be purchased
under the Plan in respect of any Offering Period shall be 85% of the Fair Market
Value of such share on either (a) the Offering Date in respect thereof or (b)
the Purchase Date in respect thereof, whichever is less.
Section 5. The aggregate Purchase Price shall be accumulated throughout the
Offering Period solely by payroll deductions which shall be applied
automatically to purchase shares of Common Stock on the Purchase Date for such
Offering Period. Payroll deductions shall commence on the first payday following
the applicable Offering Date and shall continue to the end of the Offering
Period subject to prior decrease, withdrawal or termination as provided in the
Plan.
Section 6. The Company will maintain a Plan Cash Account on its books in the
name of each Participant. On each payday the amount deducted from each
Participant's Compensation will be credited to such Participant's Plan Cash
Account. No interest shall accrue on any such payroll deductions. As of the
Purchase Date with respect to each Offering Period, the amount then in such Plan
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Cash Account shall be applied to the purchase of the number of whole shares of
Common Stock determined by dividing such amount by the applicable Purchase Price
of Common Stock. Any cash amounts remaining at the end of an Offering Period
shall be accumulated and used to purchase shares during the next Offering
Period.
Section 7. The shares of Common Stock purchased on behalf of a Participant
shall be transferred to a Stock Account maintained by a recordkeeper selected by
the Company. All rights accruing to an owner of record of such Common Stock,
including, without limitation, voting and tendering rights, shall belong to the
Participant for whose account such Common Stock is held. Each Participant is
entitled to direct the recordkeeper as to the manner in which such Common Stock
is to be voted.
Upon the termination of the Plan pursuant to Article X, each Participant
shall receive a cash payment equal to any cash in his or her Plan Cash Account.
Section 8. A Participant may elect to cease active participation in the Plan
at any time up to the end of an Offering Period by filing with the Committee a
form to be prescribed by it. As promptly as practicable after such filing, all
payroll deductions credited to such Participant's Plan Cash Account shall be
returned to such Participant in cash, without interest. A Participant who elects
to cease participation in the Plan may not resume participation in the Plan
until after the expiration of the then current Offering Period. Thereafter, any
such Participant may enroll in the Plan by filing an enrollment form as provided
in Section 1 of this Article V.
Section 9. In the event that the aggregate number of shares of Common Stock
which all Participants elect to purchase during an Offering Period shall exceed
the number of shares remaining available for issuance under the Plan, the number
of shares which each Participant shall become entitled to purchase during such
Offering Period shall be determined by multiplying the number of such shares
available for issuance by a fraction whose numerator shall be the number of the
shares such Participant has elected to purchase and whose denominator shall be
the number of the shares which all Participants have elected to purchase. Any
amounts deducted from a Participant's Compensation in excess of the amount that
may be used to acquire shares of Common Stock shall be refunded to the
Participant as soon as practicable.
ARTICLE VI
Effect of Termination of Employment
Any amounts credited to the Plan Cash Account of a Participant whose
employment is terminated for any reason, including retirement or death, or the
failure of a Participant to remain an Eligible Employee, shall be refunded,
without interest, to such individual, or, in the event of his or her death, to
his or her legal representative. A transfer by a Participant from the Company to
a Subsidiary, from one Subsidiary to another, or from a Subsidiary to the
Company shall not be considered to be a termination of employment.
ARTICLE VII
Rights Not Transferable
The rights of any Participant in the Plan, including any right to purchase
shares of Common Stock, or in any Common Stock or moneys to which he or she may
be entitled under the Plan shall not be transferable otherwise than by will or
the applicable laws of descent and distribution and any such right to purchase
shall be exercisable, only during the lifetime of such Participant, and then
only by such Participant. If a Participant shall in any manner attempt to
transfer, assign or otherwise encumber his or her rights under the Plan, other
than by will, such attempt shall be deemed to constitute a cessation of
participation in the Plan and the provisions included in Section 8 of Article V
shall apply.
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ARTICLE VIII
Limitation on Stock Ownership
Notwithstanding any provision herein to the contrary, no Participant shall
have a right to purchase shares of Common Stock pursuant to Article V if (a)
such Participant, immediately after electing to purchase such shares, would own
Common Stock possessing 5% or more of the total combined voting power or value
of stock of the Company or of any Subsidiary, or (b) the rights of such
Participant to purchase Common Stock under the Plan would accrue at a rate that
exceeds $25,000 of the Fair Market Value of such Common Stock (determined at the
time or times such rights are granted) for each calendar year for which such
rights are outstanding at any time. For purposes of the foregoing clause (a),
ownership of Common Stock shall be determined by the attribution rules of
Section 424(d) of the Code and Participants shall be considered to own any
Common Stock which they have a right to purchase under the Plan or any other
stock option or purchase plan.
ARTICLE IX
Miscellaneous Provisions
Section 1. Nothing in the Plan shall be construed to give any Eligible
Employee or Participant the right to be retained in the employ of the Company or
a Subsidiary or to affect the right of the Company or any Subsidiary or a
Participant to terminate such employment at any time with or without cause.
Section 2. A Participant shall have no rights as a shareholder with respect
to any shares of Common Stock which he or she may have a right to purchase under
the Plan until the date such shares are purchased and deposited in the
Participant's Stock Account.
Section 3. Each right to purchase shares of Common Stock under the Plan
shall be subject to the requirement that if at any time the Committee shall
determine that the listing, registration or qualification of such right to
purchase or the shares of Common Stock subject thereto upon any securities
exchange or under any state or federal law, or the consent or approval of any
governmental regulatory body, is necessary or desirable as a condition of, or in
connection with, such right to purchase or the issue of Common Stock pursuant
thereto, then, anything in the Plan to the contrary notwithstanding, no such
right to purchase may be exercised in whole or in part, and no shares of Common
Stock shall be issued, unless such listing, registration, qualification, consent
or approval shall have been effected or obtained free from any conditions not
reasonably acceptable to the Committee.
Section 4. All instruments evidencing participation in the Plan shall be in
such form, consistent with the Plan and any applicable determinations or other
actions of the Committee and the Board, as the Company shall determine.
Section 5. The Committee may establish appropriate procedures with a view
toward obtaining information regarding any disqualifying disposition by any
person of shares of Common Stock which may make available to the Company a tax
deduction in respect of such disposition.
Section 6. The Board's actions from time to time to approve amendments to
the Plan, including amendments to address the elimination of the tracking stock
structure, clarify when employees become beneficial owners of shares purchased
under the Plan, reflect new listing arrangements, extend the Plan's term through
each of June 30, 2007 and June 30, 2010, eliminate the six month waiting period
for employee participation, change the name of the Plan to reflect the Company's
new name and authorize additional shares for issuance under the Plan, are hereby
approved and ratified by the shareholders.
ARTICLE X
Amendment or Termination of the Plan
Section 1. The Plan became effective as of July 1, 1994, and shall terminate
on June 30, 2010, unless the shareholders theretofore shall have approved an
extension of such termination date.
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Section 2. The Board may, at any time and from time to time, amend
(including, but not limited to, amendments to the Plan to increase the Purchase
Price described in Section 4 of Article V), modify or terminate the Plan, but no
such amendment or modification without the approval of the shareholders shall:
(a) increase the maximum number (determined as provided in the Plan) of
shares of Common Stock which may be issued pursuant to the Plan;
(b) permit the issuance of any shares of Common Stock at a Purchase
Price less than that provided in the Plan as approved by the shareholders;
(c) extend the term of the Plan; or
(d) cause the Plan to fail to meet the requirements of an 'employee
stock purchase plan' under Section 423 of the Code.
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EXHIBIT B
THE BRINK'S COMPANY
DIRECTORS' STOCK ACCUMULATION PLAN
STATEMENT OF AMENDMENT
EFFECTIVE MAY 7, 2004
The first paragraph of Section 1 of Article II of The Brink's Company
Directors' Stock Accumulation Plan is hereby amended in its entirety to read as
follows:
Section 1. Authorized Shares. The maximum number of Units that may be
credited hereunder from and after May 7, 2004 is 109,654 Brink's Units. The
number of Shares that may be issued or otherwise distributed hereunder will
be equal to the number of Units that may be credited hereunder.
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APPENDIX A
[BRINK'S LOGO]
AUDIT AND ETHICS COMMITTEE CHARTER
I. PURPOSE
1.1 The primary purpose of the Audit and Ethics Committee (the 'Committee')
is to assist the Board of Directors (the 'Board') in fulfilling its
responsibility to oversee management's conduct of the Company's financial
reporting process, by the oversight of the integrity of regular financial
reports and other financial information provided by the Company to the
Securities and Exchange Commission or the public, the Company's systems of
internal accounting and financial controls, the qualifications, performance and
independence of the Company's independent auditors, the annual independent audit
of the Company's financial statements and the Company's legal compliance and
business ethics programs.
1.2 In discharging its oversight role, the Committee is empowered to
investigate any matter brought to its attention with full access to all books,
records, facilities and personnel of the Company and the power to retain outside
counsel, auditors or other experts for this purpose. These parties are
ultimately accountable to the Board and the Committee.
1.3 The Committee shall, on an annual basis:
(a) Review the adequacy of this Charter;
(b) Evaluate the Committee's performance under this Charter; and
(c) Prepare a report as required by the rules of the Securities and
Exchange Commission for inclusion in the Company's annual proxy statement.
II. MEMBERSHIP
2.1 The Committee shall be comprised of not fewer than three members of the
Board, and the Committee's composition will meet the requirements of the Audit
Committee Policy of the New York Stock Exchange, where applicable, rules and
regulations of the Securities and Exchange Commission and the requirements of
Section 10A of the Securities and Exchange Act of 1934.
2.2 All of the members will be directors who, in the business judgment of
the Board of Directors:
(a) Have no relationship to the Company that interferes with the
exercise of their independence from management and the Company; and
(b) Are financially literate or who will become financially literate
within a reasonable period of time after appointment to the Committee.
2.3 At least one member of the Committee shall be a financial expert, as
such term is defined by the Securities and Exchange Commission, and shall have,
in the business judgment of the Board of Directors, accounting or related
financial management expertise.
2.4 The members of the Committee shall be appointed and may be replaced by
the Company's Board of Directors.
2.5 No member of the Committee may receive any payment from the Company
other than payment for Board or committee service.
III. KEY RESPONSIBILITIES
3.1 The Committee's job is one of oversight and it recognizes that the
Company's management is responsible for preparing the Company's financial
statements and that the outside auditors are responsible for auditing those
financial statements. Additionally, the Committee recognizes that the Company's
financial management, as well as the outside auditors, have greater knowledge of
the day-to-day operations of the Company and more detailed information regarding
the Company than do Committee members. Consequently, in carrying out its
oversight responsibilities, the Committee is not providing any expert or special
assurance as to the Company's financial statements or any professional
certification as to the outside auditor's work.
3.2 The Committee shall have the authority, to the extent it deems necessary
or appropriate, to retain special legal, accounting or other consultants to
advise the Committee.
3.3 The following functions shall be the common recurring activities of the
Committee in carrying out its oversight function:
(a) The Committee shall review with management and the outside auditors
the annual audited financial statements, including disclosures under
'Management's Discussion and Analysis of Financial Conditions and Results of
Operations,' review and consider with the outside auditors the matters
required to be discussed by Statement of Auditing Standards ('SAS') No. 61
and recommend to the Board whether the audited financial statements should
be included in the Company's Annual Report on Form 10-K.
(b) The Committee shall review with management and the outside auditors
the Company's interim financial results to be included in the Company's
quarterly reports and the matters required to be discussed by SAS Nos. 61
and 100, as applicable; this review will occur prior to the Company's filing
of the Form 10-Q.
(c) The Committee shall:
(i) review and discuss with management and the independent auditor
accounting policies and financial reporting issues and judgments that may
be viewed as critical;
(ii) review and discuss analyses prepared by management and/or the
independent auditor setting forth significant financial reporting issues
and judgments made in connection with the preparation of financial
statements, including analyses of the effects of alternative GAAP methods
on the financial statements;
(iii) consider any significant changes in the accounting and auditing
policies;
(iv) review and discuss any accounting and financial reporting
proposals that may have a significant impact on the financial reports;
and
(v) review and discuss major issues as to the adequacy of the
internal controls and any special audit steps adopted in light of
material control deficiencies.
(d) The Committee shall review and discuss with management and the
independent auditor:
(i) any material financial or non-financial arrangements of the
Company that do not appear on the financial statements; and
(ii) any transactions or courses of dealing with parties that are
significant in size or involve terms or other aspects that differ from
those that would likely be negotiated with independent parties and that
are relevant to an understanding of the Company's financial statements.
(e) The Committee shall review and discuss with management its policies
and practices regarding earnings press releases, as well as financial
information and earnings guidance given to analysts and ratings agencies,
giving attention to any use of 'pro forma' or 'adjusted' non-GAAP
information.
(f) The Committee shall discuss with management the Company's major
financial risk exposures and the steps management has taken to monitor and
control such exposures, including the Company's risk assessment and risk
management policies.
(g) The Committee shall discuss with management and the independent
auditor the effect of regulatory and accounting initiatives, as well as
off-balance sheet structures on the Company's financial statements.
(h) The Committee shall meet periodically and separately with the
Company's management, the independent auditor and the internal auditors.
(i) The Committee shall review and discuss with the Company's
management, the independent auditor and the internal auditing department:
(a) the results of the audit and management letters and any reports of the
independent auditor with respect to any interim period; and (b) any
significant difficulties encountered during the course of audit work,
including: (i) management's response; (ii) any restrictions on the scope of
work or access to required information; and (iii) the nature and extent of
any significant changes in accounting principles or the application therein.
(j) The Committee shall:
(i) obtain and review a formal written report by the independent
auditor, at least annually, which report shall include descriptions of:
(A) the independent auditor's internal quality-
2
control procedures; (B) any material issues raised by the most recent
internal quality control review, or peer review, or by any inquiry or
investigation by governmental or professional authorities in the
preceding five years respecting one or more independent audits carried
out by the firm; (C) any steps taken to deal with such issues; (D) all
relationships between the independent auditor and the Company; and (E)
any other relationships that may adversely affect the independence of the
auditor;
(ii) assess the independence of the independent auditor, including
that of the independent auditor's lead partner, based on a review of the
written report and recommend to the Board that it take appropriate action
in response to the report to satisfy the independence requirements;
(iii) establish policies and procedures for the engagement of the
outside auditors to provide non-audit services; determine whether the
outside auditor's performance of any non-audit services is compatible
with the outside auditor's independence; and approve all significant
non-audit engagements with the independent auditor;
(iv) evaluate the qualifications, experience, performance and
independence of the senior members of the independent auditor team,
including that of the independent auditor's lead partner, taking into
consideration the opinions of management and the internal auditors;
present its conclusions with respect to such evaluations to the full
Board;
(v) set clear hiring policies for employees or former employees of
the independent auditors; and
(vi) assure the regular rotation of the lead audit partner as
required by law, and consider whether there should be regular rotation of
the independent auditing firm itself, in order to assure continuing
independence of the independent auditor.
(k) The Committee shall have the ultimate authority and responsibility
to select (or recommend annually for shareholder approval), evaluate and,
where appropriate, replace the outside auditor and shall approve all audit
engagement fees and terms.
3.4 The Committee shall:
(a) review the appointment, replacement, reassignment or dismissal of
the senior internal auditing executive; and
(b) oversee the internal audit department's responsibilities, budget and
staffing, and the planned scope of the internal audit.
3.5 The Committee shall obtain reports that the Company and its
subsidiary/foreign affiliated entities are in conformity with applicable legal
requirements and the Company's Business Code of Ethics.
3.6 The Committee shall review reports and disclosures of insider and
affiliated party transactions.
3.7 The Committee shall advise the Board with respect to the Company's
policies and procedures regarding compliance with applicable laws and
regulations and with the Company's Business Code of Ethics.
3.8 The Committee shall establish procedures for (a) the receipt, retention,
and treatment of complaints received by the Company regarding accounting,
internal accounting controls, or auditing matters; and (b) the confidential,
anonymous submission by employees of the Company of concerns regarding
questionable accounting or auditing matters.
3.9 The Committee annually shall provide a report for inclusion in the
Company's proxy statement in accordance with applicable law and regulation.
3.10 The Committee shall provide from time-to-time affirmation,
confirmation, certification and information to the New York Stock Exchange as is
required by the rules of such organization with respect to the Committee, its
membership and its operation.
3.11 The Committee shall make regular reports to the Board, and shall review
with the Board any issues that arise with respect to the quality or integrity of
the Company's financial statements, the Company's compliance with legal or
regulatory requirements, the performance and independence of the Company's
independent auditors or the performance of the internal audit function.
3.12 The Committee shall review and reassess the adequacy of this Charter,
at least annually.
3.13 The Committee shall annually evaluate its own performance.
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APPENDIX B
[BRINK'S LOGO]
BUSINESS CODE OF ETHICS
We believe that our Company -- Brink's and its subsidiaries -- enjoys a
reputation of which we can be proud and which underpins our business success.
The Company's standards of conduct are summarized in this Code. Simply
restating these standards, however, does not lead inevitably to ethical conduct.
Each of us must continue to understand, support and live by these standards to
enable the Company to achieve its business objectives in strict conformity with
our Business Code of Ethics. Violations of any of the provisions of this Code
may result in discipline, up to and including termination of employment.
It is important for our employees, officers and directors to know what our
Company expects of them when making decisions and conducting themselves in
corporate activities. Of all corporate activities involving conduct, among the
most important are the handling and use of confidential information, the
avoidance of potential conflicts of interest and compliance with governmental
laws, rules and regulations. Diligent observance of this Business Code of
Ethics, as well as all legal requirements, is, of course, essential to the
proper conduct of our business. Violation of applicable laws may not only entail
serious legal sanctions but, as in the case of violation of this Code, can also
lead to disciplinary actions by the Company.
Confidential Information. It is imperative that all employees, officers and
directors keep confidential all information about Company operations and
business activities that has not been made public or that is not common
knowledge among investors, competitors, customers, suppliers and others,
including other employees, officers or directors who do not have a valid
business reason for obtaining the information.
Employees, officers and directors must not disclose to others, or use for
themselves or others, any confidential Company information he or she has
originated or acquired in connection with employment. This non-disclosure
obligation not only applies to employees, officers and directors during their
period of employment or service, but also after termination of employment or
service or retirement. Any employee, officer or director who questions whether
information he or she originates or acquires is confidential has a
responsibility to determine its classification by asking his or her immediate
supervisor or Company legal counsel.
All Company documents, records, memoranda and other written materials (and
all copies) are solely the Company's property and must be returned immediately
to the Company on termination of employment.
It is not possible to list all the types of Company information that must be
treated as confidential. The following are examples of confidential information
to assist in observing this important policy:
Information about contractual arrangements and other business dealings
between suppliers, contractors or customers that has not been publicly
disclosed by management.
Information about other Company transactions, including proposed
transactions such as acquisitions or dispositions of stock or assets, that
has not been publicly disclosed by management.
Financial, accounting and cost information about the Company that has not
been publicly disclosed by management.
Information that reveals the Company's plans and strategies that have not
been publicly disclosed by management.
Employees, officers and directors should be guided by the general principle
that the Company considers confidential any information that is not officially
disclosed or publicly known and which might be useful to or desired by others
for any reason, such as using the information to buy or sell Brink's stock or to
compete against Brink's or any of its subsidiaries. Officially disclosed
information is considered to be that which is contained in official reports,
news releases and other forms of
communication that have been released by management to the public through
established communication channels.
Conflicts of Interest. All employees, officers and directors must avoid any
investments, business interests or other associations which interfere with or
influence, or even appear to interfere with or influence, their objective
judgment in furtherance of their responsibility to act in the Company's best
interests. A conflict of interest arises when an employee's, officer's or
director's judgment in acting on the Company's behalf is or may be influenced by
an actual or potential personal benefit for the employee, officer or director,
or a member of the employee's, officer's or director's family or household, from
an investment, business interest or some other association. The benefits may be
direct or indirect, financial or non-financial, through family connections,
personal associations or otherwise.
It is not possible to describe all the circumstances where a conflict of
interest involving an employee, officer, director or a member of his or her
family or household exists or may exist. The following examples are given only
to guide employees, officers and directors in making judgments about such
conflicts:
Owning an interest in the business of a supplier, competitor or customer.
Acting as a consultant, employee, officer or director for a supplier,
competitor or customer.
Competing with, or aiding others in competing with, the Company in
connection with the purchase, sale or other disposition of its property or
products, or in connection with the Company's provision of products or
services.
Acting on behalf of the Company in any transaction with any supplier,
competitor or customer in which a member of one's family or household is a
principal, officer or representative.
If any employee, officer or director finds himself or herself in a situation
where a conflict of interest exists or may exist, he or she immediately should
bring the matter to the attention of his or her supervisor, who will be
responsible for contacting the Brink's General Counsel or other Company legal
counsel for appropriate guidance.
Acceptance of Payments. No employee, officer or director shall directly or
indirectly seek or accept any payments, fees, services or other gratuities
(irrespective of size or amount) outside the normal course of the employee's,
officer's or director's business duties from any person, company or organization
which does or seeks to do business with the Company. Gifts of cash or cash
equivalents of any amount are strictly prohibited. It is not inappropriate under
this policy to be the recipient of common courtesies, sales promotional items of
small value, occasional meals or reasonable entertainment appropriate to a
business relationship and associated with business discussions; however, if
possible, questions as to the appropriateness of any such courtesy should be
reviewed by an immediate supervisor in advance of the receipt of the courtesy.
Business Entertainment. It is the Company's policy that all solicitations of
or dealings with suppliers, customers or others doing or seeking to do business
with the Company shall be conducted solely on a basis that reflects both the
Company's best business interests and its high ethical standards. Providing
common courtesies, entertainment and occasional meals for potential or actual
suppliers, customers or others involved with aspects of the Company's business
in a manner appropriate to the business relationship and associated with
business discussions is permitted, provided expenses in this connection are
reasonable.
Political Contributions. There are three basic tenets in the matter of
corporate and personal political contributions and actions.
First, the Company unequivocally forbids the use of corporate funds,
resources or property for the support of political parties or political
candidates for any office unless approved in advance by the Brink's General
Counsel or his designee.
Second, equally contrary to our Code is any pressure, direct or implied,
that infringes upon the right of any employee, officer or director to decide
whether, to whom, and in what amount he or she will make a personal political
contribution or render personal services to individual candidates or political
committees where permitted by applicable laws. Employees, officers and directors
are free, and indeed are encouraged, to endorse, advocate, contribute to, or
otherwise support any political party, candidate, or cause they may choose.
However, in personal public political statements, references to an employee's,
officer's or director's affiliation with the Company should be avoided, and in
any personal political activity it must be clear that the employee, officer or
director is not acting on behalf of or using
2
the resources of the Company. The Code is not, however, intended to discourage
voluntary and lawful political contributions to any Company-sponsored political
action committee.
Third, the Company seeks the resolution of regulatory and political issues
affecting its interests solely on the basis of the merits involved.
Corporate Citizenship. Our Company also has special responsibilities to be a
good citizen in the communities in which we operate. We are sensitive to the
economic role we play in those communities and we contribute to community as
well as to national institutions, and encourage employees, officers and
directors to take an active personal role in organizations dedicated to public
service.
Company Funds and Assets. Each employee, officer and director is personally
accountable for Company funds or assets over which he or she has control.
Anyone spending Company money, or personal money that will be reimbursed,
should always be sure the Company receives good value in return.
Anyone approving or certifying the correctness of a voucher or bill should
have reasonable knowledge that the purchases and amounts are proper.
Anyone responsible for the handling of Company assets, as well as associated
records and materials, is accountable for their safekeeping. In addition to
cash, property and equipment, assets include checks and items such as Company
credit cards.
Company Property. Protection of Company property and services is vital to
our business. How well we prevent their fraudulent or negligent misuse or theft
affects the rates our customers pay for products and services and will
ultimately affect the success of the Company.
Company property must not be used for improper personal benefit or any other
improper purpose. It should not be sold, loaned, given away or otherwise
disposed of, regardless of condition or value, except with proper authorization.
Company Records. Company business records must always be prepared accurately
and reliably. They are of critical importance in meeting our financial, legal
and management obligations.
Records are to be kept in accordance with accepted accounting rules and
controls at all times, fully and accurately reflecting all transactions. No
unrecorded fund or asset may be maintained. No false or misleading entry, record
or report may be made or permitted to go uncorrected.
All reports, vouchers, bills, payroll and service records, measurement and
performance records, and other essential data must be prepared with care and
honesty.
Records containing personal data about employees, officers and directors are
confidential. They are to be carefully safeguarded and kept current, relevant
and accurate. They should be disclosed only to authorized personnel and in
accordance with lawful process.
Securities Transactions. Employees, officers or directors with material
information about the business of the Company are prohibited from buying or
selling securities of the Company until such information has been made public.
To assist employees, officers and directors in understanding this Company policy
and the complex laws relating to 'insider trading' and other related topics, the
Company periodically circulates a memorandum entitled 'Transactions in Brink's
Securities.' Among other things, the memorandum sets forth the Company's policy
regarding the times when employees, officers and directors may purchase or sell
Brink's common stock. Copies of the memorandum may be obtained upon request to
the Brink's General Counsel.
Disclosure Policy. It is the Company's policy to provide full, fair,
accurate, timely and understandable disclosure in all documents required to be
filed with or submitted to the Securities and Exchange Commission and all other
public communications. The Company expects employees, officers and directors to
act in a manner that supports this policy.
Improper Payments. No employee, officer or director will make, or cause to
be made, any improper payment or offer any improper inducement to any actual or
potential customer or to an intermediary as a bribe, kickback or similar payment
which is directly or indirectly for the benefit of any individual (including any
government official), company or organization in any country, and which is
designed, directly or indirectly, to secure favored treatment for the Company.
Under laws in a number of jurisdictions, it is a crime, punishable by
imprisonment and substantial fines, to make payments of this kind to government
officials. The Company's policy, however, is broader in scope and is intended to
apply regardless of whether the payment or use is lawful under the laws of a
particular country. It is
3
important that any questions about this policy be discussed with Company legal
counsel before any payment is made which may be viewed as a possible violation
of this policy. To assist employees, officers and directors in understanding
this Company policy, the Company periodically circulates a memorandum entitled
'Statement of Policy Concerning Compliance with the Foreign Corrupt Practices
Act.' Copies of the memorandum may be obtained upon request to the Brink's
General Counsel.
Antitrust Compliance. The Company requires its employees, officers and
directors to engage in fair competition and to comply fully with all antitrust
laws. Except in limited circumstances (which must be first reviewed with Company
legal counsel), these laws severely restrict or prohibit anticompetitive
activities such as entering into written or oral agreements to: fix, control or
influence prices; boycott specific suppliers or customers; restrain trade by
colluding with customers to allocate products or markets; or control trade by
limiting the production of products or the delivery of services. To assist
employees, officers and directors with understanding and complying with the
antitrust laws, the Company periodically circulates a memorandum entitled
'Antitrust Compliance' which discusses a number of the relevant Company policies
and laws. The memorandum also includes various practical guidelines to better
assure antitrust compliance. Copies of the memorandum may be obtained upon
request to the Brink's General Counsel.
Fair Dealing. Each employee, officer and director should endeavor to respect
the rights of and deal fairly with the Company's customers, suppliers,
competitors and employees. No employee, officer or director should take unfair
advantage of anyone through manipulation, concealment, misuse of privileged or
proprietary information, misrepresentation of material facts, or any other
intentional unfair-dealing practice.
Corporate Opportunities. Employees, officers and directors are prohibited
from taking for themselves personally opportunities that are discovered through
the use of corporate property, information, or position for improper personal
gain. Employees, officers and directors owe a duty to the Company to advance its
legitimate interests when the opportunity to do so arises.
Duty to Report Code Violations. Each employee is responsible for bringing to
the Company's attention any circumstances which the employee believes in good
faith may constitute a violation of this Business Code of Ethics. The Company
considers that failure to discharge this responsibility may be as serious as the
violation itself. Information regarding violations should be given to the
employee's supervisor or, if the employee prefers, directly to the Brink's
General Counsel by calling (toll-free in the U.S.) 877-275-4585 or (from outside
the U.S.) 804-289-9611. The Company will see that employees giving such
information are protected from any adverse action for having reported such a
possible violation.
Waivers of the Code of Business Conduct and Ethics. Any waiver of this Code
for executive officers or directors may be made only by the Board or a Board
committee and will be promptly disclosed as required by law or stock exchange
regulation.
Annual Questionnaire. The Company requires that selected employees, officers
and directors complete and sign, annually, a questionnaire designed to elicit
information and to provide further guidance as to compliance with many of the
policies referred to in this booklet. After review of these completed
questionnaires, a report is made to the Audit and Ethics Committee of the
Brink's Board of Directors.
Application of Code -- Questions and Interpretations. Company employees,
officers and directors may have questions regarding the application of these
policies in particular situations. All employees, officers and directors are
responsible for seeking guidance in case of any question or doubt. For this
purpose, inquiries should be directed to the Brink's General Counsel by calling
(toll-free in the U.S.) 877-275-4585 or (from outside the U.S.) 804-289-9611.
4
APPENDIX C
[BRINK'S LOGO]
COMPENSATION AND BENEFITS COMMITTEE CHARTER
I. PURPOSE
The Compensation and Benefits Committee (the 'Committee') is responsible for
establishing and reviewing policies governing salaries, incentive compensation,
and the terms and conditions of employment of senior executive officers and
other key employees of the Company.
The Committee is responsible for producing an annual report on executive
compensation for inclusion in the Company's proxy statement, in accordance with
applicable rules and regulations.
II. MEMBERSHIP
The Committee shall be comprised of three or more directors. The members of
the Committee shall satisfy the independence requirements of the New York Stock
Exchange as then in effect. The members of the Committee shall be appointed and
may be replaced by the Company's Board of Directors.
III. COMMITTEE AUTHORITY AND RESPONSIBILITIES
3.1 The Committee shall have the sole authority to retain and terminate any
compensation consultant to be used to assist in the evaluation of the chief
executive officer ('CEO') or senior executive compensation and shall have sole
authority to approve the consultant's fees and other retention terms.
The Committee also shall have authority to obtain advice and assistance from
internal or external legal, accounting or other advisors, if the Committee
determines that such advice and assistance are necessary.
3.2 The Committee shall:
(a) review and approve annually corporate goals and objectives relevant
to CEO compensation; evaluate the CEO's performance in light of those goals
and objectives; set the CEO's compensation level based on this evaluation;
and, in determining the long-term incentive component of CEO compensation,
consider among other factors: (i) the Company's performance and relative
shareholder return; (ii) the value of similar incentive awards to CEOs at
comparable companies; and (iii) the awards given to the CEO in past years;
(b) review and make recommendations to the Board annually with respect
to the compensation of all officers and other key executives;
(c) make recommendations to the Board with respect to
incentive-compensation plans and equity-based plans;
(d) review and approve annually, for the CEO and the senior executives
of the Company: (i) the annual base salary level; (ii) the annual incentive
opportunity level; (iii) the long-term incentive opportunity level; and
(iv) employment agreements, severance arrangements, and change in control
agreements/provisions, in each case as, when and if appropriate;
(e) make regular reports to the Board;
(f) form and delegate authority to subcommittees when appropriate;
(g) review and reassess the adequacy of this Charter annually; and
(h) annually evaluate its own performance.
[THIS PAGE INTENTIONALLY LEFT BLANK]
APPENDIX D
[BRINKS LOGO]
CORPORATE GOVERNANCE AND
NOMINATING COMMITTEE CHARTER
I. PURPOSE
The Corporate Governance and Nominating Committee (the 'Committee') is
appointed by the Board: (1) to assist the Board by identifying individuals
qualified to become Board members and to recommend to the Board the director
nominees for the annual meeting of shareholders; (2) to oversee the governance
of the Company including recommending to the Board Corporate Governance
Policies; (3) to lead the Board in its annual evaluation of the Board's
performance; and (4) to recommend to the Board director nominees for each
committee.
II. MEMBERSHIP
The Committee shall be comprised of three or more directors. The members of
the Committee shall satisfy the independence requirements of the New York Stock
Exchange as then in effect. The members of the Committee shall be appointed and
may be removed by the Company's Board of Directors.
III. COMMITTEE AUTHORITY AND RESPONSIBILITIES
3.1. The Committee shall have the sole authority to retain and terminate any
search firm to be used to identify director candidates and shall have sole
authority to approve the search firm's fees and other retention terms. The
Committee also shall have authority to obtain advice and assistance from
internal or external legal, accounting or other advisors, if the Committee
determines that such advice and assistance are necessary.
3.2. The Committee shall:
(a) review the composition of the Board, taking into account the
Corporate Governance Policies;
(b) actively seek, identify and recommend to the Board individuals
qualified to become Board members
(c) review director candidate recommendations submitted by shareholders
pursuant to the Corporate Governance Policy regarding Third Party
Communications with Non-Management Directors;
(d) recommend to the Board nominees for each of the Board's committees;
(e) recommend to the Board nominees for election as directors;
(f) present all nominees in a timely fashion to minimize disruption in
the Company's business and at such a time to allow for the full
consideration of the nominees by the Board and the timely submission of any
filings required by the Securities and Exchange Commission;
(g) make recommendations to the Board regarding tenure and
classifications of directors;
(h) review and make recommendations to the Board annually with respect
to the compensation of directors;
(i) receive comments from all directors and report annually to the Board
with an assessment of the Board's performance, to be discussed with the full
Board; consider, discuss and recommend ways to improve the Board's
effectiveness;
(j) annually review and reassess the adequacy of the Corporate
Governance Guidelines of the Company and recommend any proposed changes to
the Board for approval; consider other corporate governance and related
issues;
(k) make regular reports to the Board;
(l) form and delegate authority to subcommittees when appropriate;
(m) review and reassess the adequacy of this Charter annually; and
(n) annually evaluate its own performance.
2
APPENDIX E
[BRINK'S LOGO]
CORPORATE GOVERNANCE POLICIES
--------------------------------------
COMPOSITION OF THE BOARD
SIZE: The Board will normally consist of between 9 and 12 members,
although the Board is willing to increase its size to
accommodate the availability of an outstanding candidate or
candidates.
MIX OF INSIDE AND OUTSIDE No more than two inside directors will be allowed on the
DIRECTORS: Board at one time, although three inside directors will be
allowed if they represent a substantial minority of the
composition of the Board.
MEMBERSHIP CRITERIA: In nominating a slate of directors, the Board will consider
business experience, diversity, international background and
leadership capabilities, along with any other skills or
experience which would be of assistance to management in
operating the Company's business.
SELECTION PROCESS: The Corporate Governance and Nominating Committee is
responsible for recommendation to the Board of director
candidates for shareholder approval. Director vacancies
occurring between shareholder meetings are filled by the
Board. The Board delegates the preliminary review process
involved to the Corporate Governance and Nominating
Committee.
TERM LIMITS: The Board does not believe it should establish term limits.
While term limits could help ensure that there are fresh
ideas and viewpoints available to the Board, they hold the
disadvantage of losing the contribution of directors who
have been able to develop, over a period of time, increasing
insight into the Company and its operations and, therefore,
provide an increasing contribution to the Board.
RETIREMENT AGE: No person may stand for election to the Board for any term
during which his or her seventy-second birthday would fall
more than six months prior to the scheduled expiration of
such term.
INDEPENDENCE: A majority of the Board will be independent, as that term is
defined by the rules of the New York Stock Exchange (see
Attachment A).
DIRECTOR RESPONSIBILITIES: The basic responsibility of a director is to discharge his
or her duties in accordance with his or her good faith
business judgment of the best interests of the Company. In
discharging that obligation, directors should be entitled to
rely on the honesty and integrity of the Company's senior
executives and its outside advisors and auditors.
MEMBERSHIP OF RETIRED CEO Any director who is also an officer of the Company shall
OR OTHER RETIRED resign immediately after he or she ceases to be an officer.
OFFICER:
CHANGE IN JOB It is the sense of the Board that individual directors who
RESPONSIBILITIES OF retire or whose job responsibilities change materially from
OUTSIDE those in effect at the time they were last elected to the
DIRECTOR: Board should volunteer to resign from the Board.
It is not the sense of the Board that the directors who have
retired or whose job responsibilities change materially from
those in effect at the time they were elected to the Board
should necessarily leave the Board. There should, however,
be an opportunity for the Board, through the Corporate
Governance and Nominating Committee, to review the continued
appropriateness of Board membership under these changed
circumstances.
SEPARATION OF ROLES OF The Board is free to make this choice in any way that seems
CHAIRMAN AND CEO: in the best interests of the Company.
Therefore, the Board does not have a policy on whether or
not the role of the Chief Executive Officer and Chairman
should be separate and, if it is to be separate, whether the
Chairman should be selected from the non-employee directors
or be an employee.
--------------------------------------
BOARD PROCEDURAL MATTERS
NUMBER OF MEETINGS: The Board will meet as frequently as needed for directors to
discharge properly their responsibilities. Regular meetings
of the Board are held six times per year and special
meetings are held as required. Directors are expected to
attend Board meetings and meetings of committees on which
they serve, to spend the time needed and meet as frequently
as necessary to discharge properly their responsibilities.
DISTRIBUTION OF ADVANCE It is the sense of the Board that information that is
MATERIALS: important to the Board's understanding of the business be
distributed in writing to the Board before the Board meets,
including draft agendas for each Board and Committee
meeting. Directors should review these materials in advance
of the meeting.
EXECUTIVE SESSIONS OF Agendas for each regular Board meeting provide for an
INDEPENDENT DIRECTORS: executive session of the independent Board members.
LEAD DIRECTOR CONCEPT: The Board does not see any need to designate a lead outside
director. In addition to outside directors regularly meeting
in executive session, the Corporate Governance and
Nominating Committee also provides an adequate forum should
special concerns arise which require the attention of
non-employee directors. Each executive session, or portion
thereof, is chaired by the chairman of the Board committee
which has primary responsibility over the matter under
discussion during the executive session or portion thereof.
THIRD PARTY COMMUNICATIONS When interested third parties have concerns, they may make
WITH NON-MANAGEMENT them known to the non-management directors by communicating
DIRECTORS: via written correspondence sent U.S. mail c/o 'Executive
Session Chairman' at the Company's Richmond, Virginia
address. All such correspondence is provided to the
presiding chairman at, or prior to, the next executive
session held at a regular Board meeting.
2
ACCESS: Board members have complete access to the Company's
Management and employees and, as appropriate, to the
Company's independent advisors.
Furthermore, the Board encourages Management to bring
managers to Board meetings from time to time who: (a) can
provide additional insight to the items being discussed
because of personal involvement in these areas and/or (b)
represent managers with future potential that Management
believes should be given exposure to the Board.
ASSESSMENT OF BOARD'S The directors will meet annually in executive session to
PERFORMANCE: discuss their assessment of the Board's performance.
BOARD COMPENSATION It is the responsibility of the Corporate Governance and
REVIEW: Nominating Committee to recommend to the Board any changes
in Board compensation. The Board makes the final
determination with respect to Board compensation. The
Corporate Governance and Nominating Committee will consider
whether directors' independence may be jeopardized if
director compensation and perquisites exceed customary
levels, if the Company makes substantial charitable
contributions to organizations with which a director is
affiliated, or if the Company enters into consulting
contracts with (or provides other indirect forms of
compensation to) a director or an organization with which
the director is affiliated. The Corporate Governance and
Nominating Committee will review compensation at the July
Board meeting of each year.
ORIENTATION AND CONTINUING All new directors must participate in an orientation program
EDUCATION: and all other directors are also invited to attend each
orientation program. Directors will be offered the
opportunity to participate in periodic field visits to
operating unit facilities.
------------------------------------------------------------
COMMITTEE STRUCTURE, DUTIES AND RESPONSIBILITIES
NUMBER AND RESPONSIBILITY/ The Board determines on an annual basis the committee
STRUCTURE AND structure and responsibilities of the committees. The
INDEPENDENCE: structure and responsibilities are set forth in the Bylaws,
and a statement of Board- adopted committee responsibilities
has been adopted. All members of the Audit & Ethics
Committee, Corporate Governance and Nominating Committee and
Compensation and Benefits Committee will be independent, as
that term is defined by the rules of the New York Stock
Exchange. If a member of the Audit & Ethics Committee
simultaneously serves on the audit committee of more than
three public companies, the Board will evaluate whether such
service impairs the ability of such member to effectively
serve on the Audit & Ethics Committee.
ASSIGNMENT AND ROTATION OF The Corporate Governance and Nominating Committee is
COMMITTEE MEMBERS AND responsible, after consultation with the Chairman of the
CHAIRMANSHIPS: Board and consideration of the desires of individual Board
members, for recommending the assignment of Board members to
various committees. It is the general practice to rotate
committee memberships and chairmanships approximately every
three years, it having been determined by the Board that
rotation more frequently does not serve the purpose of
continuity of knowledge and experience.
3
-------------------
MANAGEMENT
FORMAL EVALUATION OF CEO'S Financial and Non-Financial Criteria -- The evaluation of
PERFORMANCE: the Chief Executive Officer will be based on objective
criteria which shall include, among other factors, corporate
performance, development of Management, and the
accomplishment of annual objectives, and long- term strategy
goals.
Evaluator(s) -- The Board will make an evaluation of the
Chief Executive Officer annually and it will be communicated
to the CEO by the Chairman of the Compensation and Benefits
Committee. Advance materials will be submitted for
consideration of the Board at the first meeting of each
year.
MANAGEMENT DEVELOPMENT There will be an annual report in July of each year to the
AND SUCCESSION PLANNING: Board by the Chief Executive Officer on Management's
development program for senior managers, as well as the
Chief Executive Officer's evaluation of potential
successors.
It is the CEO's responsibility to keep the Board informed on
a continuing basis of Management's succession plan.
There should also be available, on a continuing basis, the
Chief Executive Officer's recommendation as to the Chief
Executive Officer's successor should the Chief Executive
Officer be unexpectedly disabled. This recommendation will
be presented to the Board in July of each year.
4
ATTACHMENT A
THE BRINK'S COMPANY
INDEPENDENCE DETERMINATION GUIDELINES
For a director to be deemed 'independent,' the Board of Directors of The
Brink's Company ('Brink's) shall affirmatively determine that the director has
no material relationship with Brink's either directly or as a partner,
shareholder or officer of an organization that has a relationship with Brink's.
In making this determination, the Board of Directors shall apply the following
standards:
1. A director who is an employee, or whose immediate family member is an
executive officer, of Brink's, is not independent until three years after the
end of such employment relationship. Employment as an interim Chairman or Chief
Executive Officer will not disqualify a director from being considered
independent following such employment.
2. A director who receives (or whose immediate family member, serving as an
executive officer, receives) more than $100,000 per year in direct compensation
from Brink's is not independent until three years after he or she ceases to
receive more than $100,000 per year in such compensation (excluding director and
committee fees and pensions or other forms of deferred compensation for prior
service, provided such compensation is not contingent in any way on continued
service). Compensation received by a director for former service as an interim
Chairman or Chief Executive Officer will not count toward the $100,000
limitation.
3. A director who is affiliated with or employed by (or whose immediate
family member is affiliated with or employed by) a present or former internal or
external auditor of Brink's is not independent until three years after the end
of either the affiliation or the employment or auditing relationship.
4. A director who is employed (or whose immediate family member is employed)
as an executive officer of another company where any of Brink's' present
executives serve on that company's compensation committee is not independent
until three years after the end of such service or employment relationship.
5. A director who is an executive officer or an employee (or whose immediate
family member is an executive officer) of a company that makes payments to, or
receives payments from, Brink's for property or services in an amount which, in
any single fiscal year, exceeds the greater of $1 million or 2% of such other
company's consolidated gross revenues is not independent until three years after
falling below such threshold.
APPENDIX 1
DETACH HERE
-------------------------------------------------------------------------------
PROXY
THE BRINK'S COMPANY
Proxy/Voting Direction Card Solicited on Behalf of the Board of Directors
for Annual Meeting of Shareholders, May 7,2004
P
R The undersigned hereby appoints Michael T. Dan, Austin F. Reed and Robert
O T. Ritter and each of them as proxy, with full power of substitution, to
X vote all shares of common stock of the undersigned in The Brink's Company at
Y the Annual Meeting of Shareholders to be held on May 7, 2004, at 1:00 p.m.,
Eastern Daylight Time, and at any adjournment thereof, on all matters
coming before the meeting. The proxies will vote: (1) as the undersigned
specifies on the back of this card; (2) as the Board of Directors recommends
where the undersigned does not specify a vote on a matter listed on the
back of this card; and (3) as the proxies decide on any other matter.
This Proxy/Voting Direction Card also will serve as a direction to the
Funding Agent of the Company's Savings-Investment Plan to vote all shares in
The Brink's Company credited to the account of the undersigned. The Funding
Agent will vote: (1) as the undersigned specifies on the back of this card;
(2) as the Board of Directors recommends where the undersigned does not
specify a vote on a matter listed on the back of this card;and (3) as the
Funding Agent decides on any other matter.
If registrations are not identical, you may receive more than one set of
proxy materials. Please complete and return all cards you receive. If you
wish to vote or direct a vote on all matters as the Board of Directors
recommends, please sign, date and return this card. If you wish to vote or
direct a vote on items individually, please also mark the appropriate boxes
on the back of this card.
-------------- --------------
SEE REVERSE SEE REVERSE
SIDE CONTINUED AND TO BE SIGNED ON REVERSE SIDE SIDE
-------------- --------------
THE BRINK'S COMPANY
C/O EQUISERVE TRUST COMPANY N.A.
P.O. BOX 8694
EDISON, NJ 08818-8694
DETACH HERE IF YOU ARE RETURNING YOUR PROXY CARD BY MAIL
-------------------------------------------------------------------------------
[X] Please mark PITCM
votes as in ---------
this example.
The Board of Directors Recommends a vote "FOR ALL NOMINEES" in Item 1 and
"FOR" Items 2 through 4.
1. Election of the following four nominees:
Nominees: (01) James R. Barker, (02) James L. Broadhead
(03) Gerald Grinstein, (04) Ronald L.Turner
FOR WITHHELD
ALL [ ] [ ] FOR ALL
NOMINEES NOMINEES
[ ] _______________________________________________________
For all nominees, except for those nominees written
on the line above
FOR AGAINST ABSTAIN
2. Approval of KPMG LLP as independent [ ] [ ] [ ]
public accountants.
3. Approval of amendment and restatement [ ] [ ] [ ]
of The Brink's Company's 1994 Employee
Stock Purchase Plan.
4. Approval of amendment of The Brink's [ ] [ ] [ ]
Company's Directors Stock Accumulation Plan.
NOTE: Please sign as name appears hereon. Joint owners should each sign.
When signing as attorney, executor, administrator, trustee or guardian,
please give full title as such.
Signature: ____________________________________ Date:__________________
Signature: ____________________________________ Date:__________________