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.  )

 

  Filed by the Registrant Filed by a Party other than the Registrant

 

Check the appropriate box:
Preliminary Proxy Statement
CONFIDENTIAL, FOR USE OF THE COMMISSION ONLY (AS PERMITTED BY RULEConfidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
Definitive Proxy Statement
Definitive Additional Materials
Soliciting Material Pursuant to ss.240.14a-12§240.14a-12

 

 

BRUNSWICK CORPORATION

 

(Name of Registrant as Specified In Its Charter)


(Name of Person(s) Filing Proxy Statement, if Other Thanother than the Registrant)

 

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TABLE OF CONTENTS

  Learn More on
Page:
PROXY SUMMARY5
OVERVIEW9
PROPOSAL 1:Election of Directors12
CORPORATE GOVERNANCE18
PROPOSAL 2:Approval of Amendments to our Restated Certificate of Incorporation to Declassify the Boardof Directors25
GOVERNANCE POLICIES & PRACTICES27
DIRECTOR COMPENSATION29
EXECUTIVE COMPENSATION: Compensation Discussion and Analysis32
PROPOSAL 3:Advisory Vote to Approve the Compensation of our Named Executive Officers55
EQUITY COMPENSATION PLAN56
AUDIT-RELATED MATTERS57
PROPOSAL 4: Ratification of the Appointment of Independent Registered Public Accounting Firm for theFiscal Year Ending December 31, 201858
SUBMISSION OF SHAREHOLDER PROPOSALS FOR THE 2019 ANNUAL MEETING59
APPENDICES60 
 

 

March 24, 201622, 2018

Dear fellow shareholders:

Thank you for your investment in Brunswick. In 2017, we enjoyed our eighth consecutive year of growth with year-over-year revenue growth of 9% and earnings per share, as adjusted, growth of 12%.(1) Since 2013, your investment delivered compounded annual growth in adjusted pretax earnings of 16.3% and five-year compounded annual growth in total shareholder return of 14.6%. We are proud of these results, and I want to personally thank my 15,000 fellow associates who together worked so hard to deliver them.

The Board remains committed to delivering long-term, sustainable shareholder value through continued operating excellence and strategic oversight. As a result of our continuous and rigorous review of corporate strategy and capital allocation, we recently announced plans to spin-off our fitness equipment and billiards business into a stand-alone public company. We believe that two stand-alone companies, with sharper strategic focus, appropriate capital structures, and undivided management attention, will be able to unlock greater value for our shareholders than our present structure. When complete, this spin-off will enable Brunswick Shareholder:investors to participate in either, or both, the recreational marine and fitness businesses.

As in the past, strong corporate governance is an important element of our commitment. Your Board continually evaluates and strengthens its governance practices. Last year, we unilaterally adopted bylaw amendments that include proxy access provisions. This year, we are asking shareholders to vote in favor of a plan to declassify the Board of Directors. This Proxy Statement includes details on proposed amendments to Brunswick’s Restated Certificate of Incorporation to declassify the Board (see Proposal 2 on page 25 for more details).

 

We have much work to accomplish in the coming year, but we have never been more excited about the future of your company. The spin-off of Fitness, among many other initiatives we are pleasedundertaking, should help enable both companies to invite the shareholders of Brunswick Corporation to attend the Company’s Annual Meeting of Shareholders, to be heldcapitalize on Wednesday, May 4, 2016, at 9:00 a.m. CDT at the Ritz-Carlton Hotel, 160 East Pearson Street, Chicago, Illinois 60611.

As a Brunswick shareholder, you have been able to share in our financialnew markets and operational successes. Our total shareholder return for the last three fiscal years was an outstanding 77.3%. Our Board of Directors, the management team and our over 13,000 global employees are dedicated totechnologies while continuing to add value forserve our shareholders.

In 2015, Brunswick concentrated on executing its growth plan, which included investing in innovative products, capacity expansioncustomers, remain market leaders, and focusing on both core businesses and strategic acquisitions in growing markets. In 2016, Brunswick will continuedeliver solid financial returns to drive profitable growth through product leadership, research and development programs, targeted acquisitions and expansion into new adjacent markets.our shareholders.

 

We will begin mailing a notice to our shareholders on March 24, 2016,22, 2018, containing instructions about online access to our 20162018 Proxy Statement and our Annual Report on Form 10-K for the year ended December 31, 2015,2017, as well as instructions regarding how to receive paper copies of these documents if you prefer.

 

Your vote is very important. Whether or not you plan to attend the meeting, we urge you toplease vote via the Internet, by telephone, or by signing and returning a proxy card. Please vote as soon as possible so that your shares will be represented.

 

Your Board, the management team, and Brunswick’s more than 15,000 global employees remain committed to delivering long-term value to our investors. Thank you for your continued support of Brunswick.support.

 

Sincerely,

 

Mark D. Schwabero

Chairman and Chief Executive Officer

Brunswick Corporation 1 N. Field Court Lake Forest, IL 60045-4811
Telephone 847.735.4700

Mark D. Schwabero

Chairman and Chief Executive Officer
Brunswick Corporation

Table of Contents

 

PROXY SUMMARY (1)4Please see Appendix 2 for a reconciliation of non-GAAP measures
PROXY STATEMENT8
ABOUT THE MEETING8
PROPOSAL NO. 1:      ELECTION OF DIRECTORS12
CORPORATE GOVERNANCE18
EXECUTIVE COMPENSATION24
PROPOSAL NO. 2:     ADVISORY VOTE TO APPROVE EXECUTIVE COMPENSATION43
DIRECTOR COMPENSATION44
EQUITY COMPENSATION PLAN INFORMATION46
PROPOSAL NO. 3:     RATIFICATION OF THE APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM47
REPORT OF THE AUDIT COMMITTEE48
SUBMISSION OF SHAREHOLDER PROPOSALS FOR 2017 ANNUAL MEETING49
 
Back to Contents

NOTICE OF 2018 ANNUAL MEETING OF SHAREHOLDERS

 

Notice of Annual Meeting of ShareholdersMEETING INFORMATION

DATE AND TIME:

 

May 4, 2016

9:002, 2018
9 a.m. CDT

 

Ritz-Carlton Hotel, 160 E. Pearson Street, Chicago, Illinois

March 24, 2016

Dear Brunswick Shareholder:

The Annual Meeting of Shareholders of Brunswick Corporation will be held at the Ritz-Carlton Hotel, 160 E. Pearson Street, Chicago, Illinois, on Wednesday, May 4, 2016, at 9:00 a.m. CDT. At the Annual Meeting, we will consider and vote upon the following matters:

(1)The election to the Company’s Board of Directors of the three nominees named in the attached Proxy Statement;
(2)The approval of the compensation of our named executive officers on an advisory basis;
(3)The ratification of the Audit Committee’s appointment of Deloitte & Touche LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2016; and
(4)Any other business that may properly come before the meeting.

Sincerely,

Christopher F. Dekker

SecretaryLOCATION:

 

Brunswick Corporation 1

26125 N. Field Court Lake Forest,Riverwoods Blvd., Suite 500
Mettawa, IL 60045-4811
Telephone 847.735.470060045

VOTING MATTERS
2018 PROPOSALS
Board Recommends:Learn
More on
Page:
PROPOSAL 1: Election of Directors FOR
each nominee
12
PROPOSAL 2: Approval of Amendments to our Restated Certificate of Incorporation to Declassify the Board of Directors FOR25
PROPOSAL 3: Advisory Vote to Approve the Compensation of our Named Executive Officers FOR55
PROPOSAL 4: Ratification of the Appointment of Independent Registered Public Accounting Firm for the Fiscal Year Ending December 31, 2018 FOR58

REVIEW YOUR PROXY STATEMENT AND VOTE IN ONE OF FOUR WAYS*:

 
Back to ContentsBY INTERNETBY TELEPHONEBY MAILIN PERSON**

Proxy Summary

This summary highlights information contained elsewhere in this Proxy Statement. This summary does not contain all of the information that you should consider, and you should read the entire Proxy Statement carefully before voting. Page references are supplied to help you find further information in this Proxy Statement.

Eligibility to Vote

proxyvote.com

 

By 5:00 p.m. EDT
on May 1, 2018

1-800-690-6903

By 5:00 p.m. EDT
on May 1, 2018

Completing, signing, and
returning your proxy or
voting instruction card

To arrive by May 1, 2018

Annual Meeting

May 2, 2018
9 a.m. CDT

AM I ELIGIBLE TO VOTE? You can vote if you were a shareholder of record at the close of business on March 4, 2016.

How to Cast Your Vote

You can vote by any of the following methods:5, 2018.

 

*Internet (www.proxyvote.com) untilIf you hold shares in the Brunswick Retirement Savings Plan or the Brunswick Rewards Plan, you must direct the trustee of these plans how to vote these shares by one of the above methods no later than 5:00 p.m. EDT on May 3, 2016;April 27, 2018.
Telephone 1-800-690-6903 until 5:00 p.m. EDT on May 3, 2016;
**Completing, signing and returning your proxy or voting instruction card to arrive by May 3, 2016; or
In person, at the Annual Meeting: If you are a shareholder of record, your admission ticket is attached to your proxy card. If your shares are held in the name of a broker, bank, or other nominee, you must bring proof of ownership with you to attend the meeting.
If you hold shares in the Brunswick Retirement Savings Plan or the Brunswick Rewards Plan, you must direct the trustee of these plans how to vote these shares by one of the above methods not later than 5:00 p.m. EDT on April 29, 2016.

Voting Matters

 

 Board Vote2018 PROXY STATEMENT | 4
Proxy SummaryPage ReferenceOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

PROXY SUMMARY

This summary highlights information contained elsewhere in this Proxy Statement. The summary does not contain all of the information that you should consider, and you should read the entire Proxy Statement carefully before voting. Page references are supplied to help you find further information in this Proxy Statement.

 

9% increase in 2017 net sales compared with 2016.

4-year CAGR(2) of 7.5%.

Recommendation4-year CAGR(2) of 16.3%.(for more detail)Generated strong free cash
Election
flow of Directors$243.1 million in
2017.
FORFunded investmentseach Director Nominee in growth, enhanced shareholder returns with stock repurchases and increased dividends, and continued to execute our pension de-risking strategy.12
Advisory Vote on the Approval of Executive CompensationFOR43
Ratification of the Appointment of AuditorsFOR47

 

Business Highlights

(forFor more detail, please see Brunswick’sour Annual Report on Form 10-K filed with the SECSecurities and Exchange Commission (SEC) on February 17, 2016)

Our results in 2015 represent the sixth consecutive year of strong improvements in operating performance. The Company sought to achieve the following financial objectives in 2015:20, 2018.

 

MARK D. SCHWABERO

As a Brunswick shareholder, you have shared in our financial and operational success. Our 2017 results represent our eighth consecutive year of growth. Thank you for your continued support.

(1)Deliver revenue growthPlease see Appendix 2 for a reconciliation of non-GAAP measures
Ended the year with a 7 percent increase in net sales when compared with 2014
(2)Experience increases in earnings before income taxes, as well as a slight improvement in gross margin percentageCompound Annual Growth Rate

Reported earnings before income taxes of $315.2 million in 2015 compared with earnings before income taxes of $287.9 million in 2014
Improved gross margins by 10 basis points when compared with 2014
Continue to generate strong free cash flow and execute against the Company’s capital strategy
Ended the year with $668.8 million of cash and marketable securities, a net increase of $32.9 million
Funded investments in growth, both organically through capital expenditures and through acquisition opportunities, such as the $29.7 million investment in marine parts and accessories and Fitness segment acquisitions during 2015
Contributed $73.6 million to the Company’s defined benefit pension plans, which included an amount made in connection with lump sum payments to certain pension plan participants in 2015
Enhanced shareholder returns by repurchasing $120.0 million of our common stock under the Company’s share repurchase program in 2015 and increased cash dividends paid to shareholders in 2015 to $48.3 million from $41.7 million in 20142018 PROXY STATEMENT | 5

BRUNSWICK CORPORATION - 2016 Proxy Statement4

 
Back to Contents

We achieved excellent Total Shareholder Return (TSR) for the 3 years ended December 31, 2015

3-year TSR: 77.3%
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

 

STOCK PRICE HISTORYDIRECTOR NOMINEES

*Closing stock price as reported on the New York Stock Exchange for each year.

Director Nominees (page 12)

Name Age Director since Occupation Independent (Yes/No) Committee Memberships Other Public Company Boards
Nolan D. Archibald 72 1995 Retired; Executive Chairman of Stanley, Black & Decker, Inc. Yes 

Finance 

Executive

 

Huntsman Corporation

Lockheed Martin Corporation

David C. Everitt 63 2012 Retired; President, Agricultural and Turf Division -North America, Asia, Australia and Sub-Saharan and South Africa, and Global Tractor and Turf Products of Deere & Company Yes 

Human Resources and Compensation 

Nominating and Corporate Governance 

Qualified Legal Compliance

 

Agrium, Inc.

Allison Transmission Holdings, Inc. 

Harsco Corporation

Roger J. Wood 53 2012 Retired; President and Chief Executive Officer of Dana Holding Corporation Yes 

Audit

Finance

 Tenneco Inc.

Governance HighlightsFor more information, visit page 12

 

KEY SKILLS & EXPERTISE

Mr. Mark D. Schwabero serves as our

MANUEL A. FERNANDEZ

Chairman, CEO, & President of
Gartner Group (Retired)

Director Since: 1997

Age: 71

Other Public Boards:2

Committees:

Nominating and Chief Corporate
Governance (Chair)

Executive Officer

Mr. Manuel A. Fernandez serves as our Lead Independent Director
9 of 10 directors are independent under the Board’s Principles and Practices and the NYSE Listed Company Manual
All of the members of the Audit, Finance,

Human Resources and Compensation

LEAD INDEPENDENT DIRECTOR

KEY SKILLS & EXPERTISE

MARK D. SCHWABERO

Chairman & CEO of
Brunswick Corporation

Director Since: 2014

Age: 65

Other Public Boards: 1

Committees:

Executive

KEY SKILLS & EXPERTISE

DAVID V. SINGER

CEO of
Snyder’s-Lance, Inc. (Retired)

Director Since: 2013

Age: 62

Other Public Boards: 3

Committees:

Audit

Finance

INDEPENDENT DIRECTOR

KEY SKILLS & EXPERTISE

J. STEVEN WHISLER

Chairman & CEO of Phelps
Dodge Corporation (Retired)

Director Since: 2007

Age: 63

Other Public Boards: 2

Committees:

Human Resources and
Compensation (Chair)

Executive

Nominating and Corporate
Governance and Qualified Legal Compliance Committees are independent

Our directors collectively attended 98 percent of the 2015 Board and committee meetings

INDEPENDENT DIRECTOR

 

 

The Board of Directors believes that having our Chief Executive OfficerCEO serve as Chairman of the Board is in the best interest of the shareholders at this time because this structure ensures a seamless flow of communication between management and the Board, in particular with respect to the Board’s oversight of the Company’sour strategic direction, as well as the Board’s ability to ensure management’s focused execution of thatour strategy. Our strong Lead Independent Director position ensures robust and independent Board oversight.

 

BRUNSWICK CORPORATION - 2016 Proxy Statement5The Board is committed to strong corporate governance and has approved amendments to our Restated Certificate of Incorporation to declassify the Board of Directors, subject to shareholder approval at the Annual Meeting.

Key skills & expertise legend

Audit/
Finance
GlobalOperations/
Manufacturing
TechnologyCEOPublic
Company
Board
Regulatory/
Legal/
Governance
Dealers/
Distribution
DiverseFitness/
Marine
Industry
Marketing
2018 PROXY STATEMENT | 6
 
Back to Contents
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

Executive Compensation (page 24)

EXECUTIVE COMPENSATION

For more information, visit page 32

 

Compensation
Element
 
Compensation ElementMetric(s)RoleHow It’s Designed
and Determined
 Role within Compensation Program How Designed and Determined
Base SalaryBASE SALARYn/aFoundation of total pay, as incentives and benefits are a function of base salary.Reviewed annually, targeting median of peer group.market. We consider external competitiveness, individual performance, and internal equity when determining executives’ base salaries.
Annual Incentive PlanANNUALINCENTIVEPLAN

Earnings Per Share (EPS)

Divisional Earnings Before Interest and Taxes (EBIT)

Primary element used to reward accomplishments against established business and individual goals within a given year.Target funding based on planned performance for the year, as approved by the Board of Directors, with actual funding tied to annual performance against target metrics and limited to no more than 200 percent of target funding.
Performance SharesPERFORMANCESHARES

Cash Flow Return On Investment (CFROI)

Operating Margin

Relative Total Shareholder Return (TSR)

Focus management team on creating and sustaining value for shareholders.Annual performance sharePerformance Share grants for named executive officersNamed Executive Officers (NEOs) represent 50 percent of targeted equity value. Three-year performance plan with shares earned based on achievement of CFROI and Operating Margin targets, andmodified by Brunswick’s TSR performance relative to the TSR of an established peer group as(as measured over a three-year period.period).
Restricted Stock Units RESTRICTEDSTOCK UNITS(RSUs)Absolute TSRReinforce retention and reward Brunswick’s sustained TSR.Annual RSU grants for NEOs represent 50 percent of targeted equity value. RSUs cliff vest at the end of a three-year period.

 

 

WHAT WE DODO:

Base a very high percentage of executive pay on performance

Require executives to achieve performance-based goals tied to shareholder return

Target median compensation levels and review market data of our peer group when making executive compensation decisions

Apply strict share ownership guidelines to NEOs and Directors

Require vested shares from our equity compensation programs to be held until share ownership guidelines are met

Disclose complete information on annual incentive plans

Evaluate, and manage, risk in our compensation programs

Use an independent compensation consultant

Have an established clawback policy

Maintain double-trigger equity award vesting acceleration upon involuntary termination following a Change in Control (CIC)

Engage in a rigorous and thoughtful executive succession planning process with the Board

WHAT WE DON’T DO
We tie a very high percentage of executive pay to performance We have no tax gross-ups (including perks, excise tax)
 We require executives to achieve performance-based goals tied to shareholder return We have no modified single-trigger or single-trigger CIC severance agreements (we only use double-trigger CIC severance provisions)
 We target median compensation levels and review market data of our peer group when making executive compensation decisions We expressly forbid option repricing without shareholder approval in all of our equity plans
 We apply strict share ownership guidelines to NEOs and directors All of our active equity plans expressly forbid exchanges of underwater options for cash
 We disclose complete information on annual incentive plans We do not allow hedging of shares by our directors or employees
 We require vested shares from our equity compensation programs to be held until share ownership guidelines are met We do not allow pledging of shares by our directors or employees
 We consider, and attempt to mitigate, risk in our compensation program We do not pay dividends or dividend equivalents on unearned performance shares
 We use an independent compensation consultant
 We have an established clawback policy
 Starting in 2016, we implemented double-trigger equity award vesting acceleration upon a Change in Control (CIC)DO:

 

No tax gross-ups (including perquisites, excise tax)

 

BRUNSWICK CORPORATION - 2016 Proxy Statement6No modified single-trigger or single-trigger CIC severance agreements (we only use double-trigger CIC severance provisions)

Expressly forbid option repricing not in accordance with plans already approved by shareholders

Expressly forbid exchanges of underwater options for cash in all of our active equity plans

No hedging of shares by our Directors or employees

No pledging of shares by our Directors or employees

No dividends or dividend equivalents on unearned Performance Shares


2018 PROXY STATEMENT | 7
 
Back to Contents

2015 Executive Total Targeted Compensation Mix (page 26)

Component CEO  Other NEOs 
Base Salary  14%  25%
Annual Incentives  21%  23%
Long-Term Incentives  65%  52%

2015 Executive Compensation Summary (page 34)

Name and Principal
Position
 Year Salary Stock Awards Non-Equity
Incentive Plan
Compensation
 Change in
Pension
Value and
Non-qualified
Deferred
Compensation
Earnings
 All Other
Compensation
 Total
Dustan E. McCoy(1)                    
Former Chairman and                    
Chief Executive Officer 2015 $ 1,125,000 $6,500,604 $1,777,000 $188,089 $452,777 $ 10,043,470
Mark D. Schwabero(2)                    
Chairman and Chief                    
Executive Officer 2015 $744,231 $2,502,375 $784,000 $- $181,097 $4,211,703
William L. Metzger                    
Senior Vice President                    
and Chief Financial                    
Officer 2015 $517,500 $1,000,904 $545,000 $29,292 $121,285 $2,213,981
John C. Pfeifer                    
Vice President and                    
President – Mercury                    
Marine 2015 $479,423 $1,000,904 $429,000 $191 $115,019 $2,024,537
B. Russell Lockridge(3)                    
Vice President                    
and Chief Human                    
Resources Officer 2015 $430,615 $500,567 $453,000 $- $130,217 $1,514,399

(1)Proxy SummaryMr. McCoy retired as Chairman and Chief OverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive Officer effective February 11, 2016.
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices
(2)The Board of Directors appointed Mr. Schwabero as Chairman and Chief Executive Officer effective February 11, 2016. Mr. Schwabero previously served as Brunswick’s President and Chief Operating Officer.
(3)Mr. Lockridge has provided notice of his intent to retire effective March 31, 2016.

 

Advisory Vote to Approve Executive Compensation (page 43) and Ratification of Appointment of Auditors (page 47)2017 EXECUTIVE TOTAL TARGETED COMPENSATION MIX

For more information, visit page 35

2017 EXECUTIVE COMPENSATION SUMMARY

For more information, visit page 44

YearSalaryBonusStock
Awards
Non-Equity
Incentive Plan
Compensation
Change in
Pension Value
and Non-Qualified
Deferred
Compensation
Earnings
All Other
Compensation
Total
MARK D. SCHWABERO, Chairman and Chief Executive Officer
2017$1,036,539$5,000,340$821,000$259,641$7,117,520
WILLIAM L. METZGER, Senior Vice President and Chief Financial Officer
2017$523,269$999,930$360,000$59,931$130,101$2,073,231
JAIME A. IRICK, Vice President and President — Fitness Division
2017$451,250$460,000$1,601,492$160,000$229,558$2,902,300
JOHN C. PFEIFER, Vice President and President — Mercury Marine
2017$493,269$999,930$405,000$346$134,288$2,032,833
HUW S. BOWER, Vice President and President — Brunswick Boat Group
2017$399,969$799,952$160,000$107,256$1,467,177

ADDITIONAL PROPOSALS

FOR MORE INFORMATION, VISIT PAGES 25, 55, AND 58

 

In addition to the election of directors,Directors (page 12), we are asking our shareholders to approve amendments to our Restated Certificate of Incorporation to declassify our Board of Directors (page 25). We are also asking shareholders to approve our compensation programs for Named Executive Officers on a non-binding advisory basis our compensation programs for named executive officers (commonly referred to as a “say-on-pay vote”) and(page 55). Finally, we are asking shareholders to ratify the Audit Committee’s appointment of Deloitte & Touche LLP (Deloitte) as our independent registered public accounting firm for fiscal year 2016.2018 (page 58).

 

BRUNSWICK CORPORATION-2016 Proxy Statement7

2018 PROXY STATEMENT | 8
 
Back to Contents
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

OVERVIEW

PROXY STATEMENT

 

The Board of Directors of Brunswick Corporation is soliciting proxies from Brunswick’s shareholders on behalf of the Company for the annual meeting to be held at the Ritz-Carlton Hotel, 160 E. Pearson Street, Chicago,Brunswick Corporation headquarters, 26125 N. Riverwoods Boulevard, Suite 500, Mettawa, Illinois 60611,60045, on Wednesday, May 4, 2016,2, 2018, at 9:00 a.m. CDT (the Annual Meeting). As required by rules adopted by the Securities and Exchange Commission (the SEC),(SEC) rules, we are making this Proxy Statement and our Annual Report on Form 10-K available to our shareholders electronically via the Internet. In addition, we are using the SEC’s Notice and Access Rules to provide shareholders with more options for receipt of these materials. Accordingly, on March 24, 2016,22, 2018, we will begin mailing a Notice of Internet Availability of Proxy Materials (the Notice) to our shareholders containing instructions about how to access this Proxy Statement and Brunswick’s Annual Report via the Internet, how to vote online or by telephone, and how to receive paper copies of the documents and a proxy card.

 

FREQUENTLY ASKED QUESTIONS ABOUT THE MEETING

 

What is the purpose of the Annual Meeting?

What is the purpose of the Annual Meeting?

 

At the Annual Meeting, shareholders will act upon matters described in the Notice, including the election to our Board of Directors of the three nominees named in this Proxy Statement, the approval of the compensation of our named executive officers on an advisory basis and the ratification of the Audit Committee’s appointment of Deloitte & Touche LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2016.including:

 

The election to our Board of Directors of the four nominees named in this Proxy Statement
Approval of amendments to our Restated Certificate of Incorporation to declassify the Board of Directors
An advisory say-on-pay vote to approve the compensation of our Named Executive Officers
Ratification of the Audit Committee’s appointment of Deloitte as our independent registered public accounting firm for the fiscal year ending December 31, 2018

Who may vote at the Annual Meeting?

Who may vote at the Annual Meeting?

 

Only holders of one or more of the 90,768,92687,359,679 shares of Brunswick common stock, par value $.75 per share (Common Stock), issued and outstanding as of the close of business on March 4, 20165, 2018 (the Record Date) will be entitled to vote at the Annual Meeting. Each holder as of the Record Date is entitled to one vote for each share of Brunswick Common Stock held.

 

Who can attend the Annual Meeting?

Who can attend the Annual Meeting?

 

Only shareholders who owned Brunswick Common Stock as of the Record Date, or their duly appointed proxies, will be entitled to attend the Annual Meeting. If you hold your shares through a broker, bank, or other nominee, you will not be admitted to the Annual Meeting unless you bring a copy of a statement (such as a brokerage statement) from your nominee reflecting your stock ownership as of the Record Date.

 

Who will count the votes?

How do I vote?

Brunswick’s tabulator, Broadridge Financial Solutions, Inc., will count the votes. Representatives of Brunswick’s Law Department will act as inspectors of election.

How do I vote?

 

If you are a shareholder of record as of the Record Date, you can vote: (i) by attending the Annual Meeting; (ii) by following the instructions on your Notice for voting by telephone at 1-800-690-6903 or via the Internet atwww.proxyvote.com; or (iii) by signing, dating and mailing in a proxy card. The deadline for voting by telephone or via the Internet is 5:00 p.m. EDT on May 3, 2016.

  

BY INTERNET

proxyvote.com

By 5:00 p.m. EDT
on May 1, 2018

BY TELEPHONE

1-800-690-6903

By 5:00 p.m. EDT
on May 1, 2018

  

BY MAIL

Completing, signing,
and returning your
proxy or voting
instruction card

To arrive by May 1, 2018

IN PERSON

Annual Meeting

May 2, 2018
9 a.m. CDT

 

If you hold your shares through a broker, bank, or other nominee, that institution will instruct you as to how your shares may be voted by proxy, including whether telephone or Internet voting options are available. If you hold your shares through a broker, bank, or other nominee and would like to vote in person at the Annual Meeting, you must first obtain a proxy issued in your name from the institution that holds your shares.

 

If you hold any shares in the Brunswick Retirement Savings Plan or the Brunswick Rewards Plan, you must direct the trustee of these plans how to vote these shares by following the instructions on your Notice for voting by telephone at 1-800-690-6903 or via the Internet at www.proxyvote.com, or by signing, dating, and mailing in a proxy card. The deadline for voting shares held in the Brunswick Retirement Savings Plan or the Brunswick Rewards Plan is 5:00 p.m. EDT on April 29, 2016.27, 2018. The trustee will vote these shares as you direct. The trustee will vote allocated shares of the Company’s common stockCommon Stock for which proxies are not received in direct proportion to voting by allocated shares for which proxies are received.


 

BRUNSWICK CORPORATION-2016 Proxy Statement8

2018 PROXY STATEMENT | 9
 
Back to Contents
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

Can I change my vote after I have voted?

FREQUENTLY ASKED QUESTIONS ABOUT THE MEETING

Can I change my vote after I have voted?

 

You may revoke your proxy and change your vote at any time before the final vote at the Annual Meeting, including voting via the Internet or by telephone (only your latest Internet or telephone proxy that is timely submitted prior to the meeting will be counted), by signing and returning a new proxy card with a later date, or by attending the meeting and voting in person. However, your attendance at the Annual Meeting will not automatically revoke your proxy unless you vote again at the meeting or specifically request in writing that your prior proxy be revoked.

 

Who will count the votes?

Brunswick’s tabulator, Broadridge Financial Solutions, Inc., will count the votes. Representatives of Brunswick’s Legal Department will act as inspectors of election.

How will my shares be voted if I sign, date and return a proxy card?

How will my shares be voted if I sign, date, and return a proxy card?

 

If you sign, date, and return a proxy card and indicate how you would like your shares to be voted, your shares will be voted as you have instructed. If you sign, date, and return a proxy card but do not indicate how you would like your shares to be voted, your proxy will be voted as follows: forin accordance with the election of the three director nominees named in this Proxy Statement; for the approval of the compensation of our named executive officers; and for the ratification of the Audit Committee’s appointment of Deloitte & Touche LLP as our independent registered public accounting firm for the Company’s fiscal year ending December 31, 2016.Board’s recommendations. With respect to any other matter that is properly brought before the meeting, the proxy holders will vote the proxies held by them in accordance with their best judgment.

 

What are the Board’s recommendations?

What are the Board’s recommendations?

PROPOSAL 1:

Election of Directors


FOR

each nominee

PROPOSAL 2:

Approval of Amendments to our Restated Certificate of Incorporation to Declassify the Board of Directors


FOR

PROPOSAL 3:

Advisory Vote to Approve the Compensation of our Named Executive Officers


FOR

PROPOSAL 4:

Ratification of the Appointment of Independent Registered Public Accounting Firm for the Fiscal Year Ending December 31, 2018


FOR

What vote is required to approve each matter to be considered at the Annual Meeting?

 

The Board of Directors recommends a vote for the election of the three director nominees named in this Proxy Statement. The Board recommends a vote for the approval of the compensation of our named executive officers. The Board and the Audit Committee recommend the ratification of the Audit Committee’s appointment of Deloitte & Touche LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2016.

What vote is required to approve each matter to be considered at the Annual Meeting?

Election of Directors. Directors. Brunswick has adopted a majority voting standard for the uncontested election of directorsDirectors and, therefore, the three directorfour Director nominees shall be elected to the Board of Directors if they each receive a majority of the votes cast, in person or by proxy, at the Annual Meeting. Under Brunswick’s majority voting standard for uncontested elections, if the number of votes cast “For” a directorDirector nominee’s election does not exceed the number of votes cast “Against”

election, then the directorDirector nominee must tender his or her resignation from the Board promptly after certification of the shareholders’ vote. The Board will decide within 120 days of that certification, through a process managed by the Nominating and Corporate Governance Committee and excluding the directorDirector nominee in question, whether to accept the resignation. Because Brunswick has adopted a majority voting standard for the uncontested election of directors,Directors, abstentions will have no effect on the election of directorDirector nominees. If any one or more of the three directorDirector nominees is unable to serve, votes will be cast, pursuant to authority granted by the enclosed proxy, for the alternate individual or individuals designated by the Board.Board designates.

 

Advisory Approval of Amendments to our Restated Certificate of Incorporation to Declassify the Board of Directors. The affirmative vote of the holders of 80% of the outstanding shares entitled to vote in elections of Directors, represented in person or by proxy, will be required for the approval of the amendments. Because approval of this resolution requires a supermajority of the outstanding shares represented at the Annual Meeting, abstentions will have the same effect as votes against approval.

Advisory Vote to Approve the Compensation of our Named Executive Compensation. Officers. The affirmative vote of the holders of a majority of the shares having voting power, represented in person or by proxy, will be required for the approval of the non-binding resolution relating to the compensation of the Company’s named executive officers.our Named Executive Officers (NEOs). Because approval of this resolution requires a majority of the shares having voting power and represented at the Annual Meeting, abstentions will have the same effect as votes against approval.

 

Ratification of the Appointment of Independent Registered Public Accounting Firm. Firm. The affirmative vote of the holders of a majority of the shares having voting power, represented in person or by proxy, will be required for the ratification of the Audit Committee’s appointment of Deloitte & Touche LLP as Brunswick’s independent registered public accounting firm for the fiscal year ending December 31, 2016.2018. Because the vote to ratifyratification of the independent registered public accounting firm requires a majority of the shares having voting power and represented at the Annual Meeting, abstentions will have the same effect as votes against ratification.

 

BRUNSWICK CORPORATION-2016 Proxy Statement9

What constitutes a quorum?
Back to Contents

What constitutes a quorum?

 

The Annual Meeting will be held only if a quorum is present. A quorum will be present if a majority of the 90,768,926 shares of Brunswick Common Stock issued and outstanding on the Record Date are represented, in person or by proxy, at the Annual Meeting. Shares represented by properly completed proxy cards or ballots marked “Abstain” or returned without voting instructions are counted as present for the purpose of determining whether a quorum is present. In addition, broker non-votes will be counted as present for quorum purposes.


2018 PROXY STATEMENT | 10
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

FREQUENTLY ASKED QUESTIONS ABOUT THE MEETING

 

How will broker non-votes be treated?

How will broker non-votes be treated?

 

Broker non-votes occur when a broker lacks discretionary authority to vote on a proposal and the beneficial owner has not provided an indication as toinstructions about how to vote. Brunswick will treat broker non-votes as present to determine whether or not there is a quorum at the Annual Meeting, but they will not be treated as having voting power on the proposals, if any, for which the broker indicates it does not have discretionary authority. This means that broker non-votes will not have any effect on whether a proposal passes.

We expect that brokers will have discretionary authority with respect to the proposal to ratify the appointment of our independent registered public accounting firm but will lack discretionary authority with respect to the election of directors andDirectors, the advisory vote to approve the compensation of our Named Executive Officers, and approval of amendments to our Restated Certificate of Incorporation to declassify the Company’s named executive officers, and accordinglyBoard of Directors. Accordingly, broker non-votes will have no impact on such proposals, but brokers will have discretionary authority with respectmay occur as to ratification of the appointment of the independent registered public accounting firm.these three proposals.

 

Will my vote be kept confidential?

Will my vote be kept confidential?

 

Yes. As a matter of policy, shareholder proxies, ballots, and tabulations that identify individual shareholders are kept confidential and are available only to Brunswick’sour tabulator and inspectors of election, who are obligated to keep your vote confidential.

 

Who pays to prepare, mail and solicit the proxies?

Brunswick pays all of the costs of preparing, mailing and soliciting proxies. Brunswick asks brokers, banks, voting trustees and other nominees and fiduciaries to forward notices and, when requested, proxy materials to the beneficial owners and to obtain authority to execute proxies. Brunswick will reimburse the brokers, banks, voting trustees and other nominees and fiduciaries upon request. In addition to solicitation by mail, telephone, facsimile, Internet or personal contact by its designated officers and employees (who will not receive additional compensation for their solicitation efforts), Brunswick has retained the services of Georgeson Inc. to solicit proxies for a fee of $9,900 plus expenses.

What if other matters come up during the Annual Meeting?

What if other matters come up during the Annual Meeting?

 

If any matters other than those referred to in the Notice properly come before the meeting, the individuals named in the accompanying form of proxy will vote the proxies held by them in accordance with their best judgment. Brunswick isWe are not aware of any business other than the items referred to in the Notice that may be considered at the meeting.

 

BRUNSWICK CORPORATION-2016 Proxy Statement10

Who pays to prepare, mail, and solicit the proxies?

Brunswick pays all of the costs of preparing, mailing, and soliciting proxies. We ask brokers, banks, voting trustees, and other nominees and fiduciaries to forward notices and, when requested, proxy materials to the beneficial owners and to obtain authority to execute proxies. We reimburse the brokers, banks, voting trustees, and other nominees and fiduciaries upon request. In addition to solicitation by mail, telephone, facsimile, Internet, or personal contact by our designated officers and employees (who will not receive additional compensation for their solicitation efforts), we have retained the services of Innisfree M&A Incorporated to solicit proxies for a fee of $75,000.

Back to ContentsWhy did I receive a one-page notice in the mail regarding the Internet availability of proxy materials instead of a full set of printed proxy materials?

Why did I receive a one-page notice in the mail regarding the Internet availability of proxy materials instead of a full set of printed proxy materials?

 

Pursuant to SEC rules, Brunswick iswe are required to provide access to itsour proxy materials via the Internet and hashave elected to use the SEC’s Notice and Access Rules for soliciting proxies. Accordingly, Brunswick iswe are sending a Notice to all of itsour shareholders as of the Record Date. All shareholders may access Brunswick’sour proxy materials on the website referred to in the Notice. ShareholdersYou may also request to receive a printed set of the proxy materials. InstructionsYou can find instructions regarding how to access Brunswick’sour proxy materials via the Internet and how to request a printed copy can be found in the Notice. Additionally, by following the instructions in the Notice, shareholdersyou may request to receive proxy materials in printed form by mail or electronically by e-mailemail on an ongoing basis. Choosing to receive your future proxy materials by e-mailemail will save Brunswickus the cost of printing and mailing documents to you and will reduce the impact of the Company’sour Annual Meetings on the environment. If you choose to receive future proxy materials by e-mail,email, you will receive an e-mailemail next year with instructions containing a link to those materials and a link to the proxy voting site. Your election to receive proxy materials by e-mailemail will remain in effect until you terminate it.

 

Multiple individuals residing in my home are beneficial owners of shares of Brunswick Common Stock. Why did we receive only one mailing?

Multiple individuals residing in my home are beneficial owners of shares of Common Stock. Why did we receive only one mailing?

 

Brunswick is sending only one envelope with multiple Notices to you if you share a single address with another shareholder, unless we have received instructions to the contrary from you. This practice, known as “householding,” is designed to eliminate duplicate mailings, conserve natural resources, and reduce Brunswick’sour printing and mailing costs. We will promptly deliver a separate Notice to you upon written or verbal request. If you wish to receive duplicateseparate mailings in the future, you may contact Brunswick Shareholder Services by telephone at 847.735.4294, by mail at 126125 N. Field Court, Lake Forest,Riverwoods Blvd., Ste 500, Mettawa, IL 60045, or by e-mailemail atservices@brunswick.com.

If you currently receive multiple Notices, you can request householding by contacting Brunswick Shareholder Services as described above. If you own your shares through a broker, bank, or other nominee, you can request householding by contacting the holder of record.


 

BRUNSWICK CORPORATION-2016 Proxy Statement11

2018 PROXY STATEMENT | 11
 
Back to Contents
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

PROPOSAL NO. 1:ELECTION OF DIRECTORS

At the Annual Meeting, shareholders willWhat am I voting on? Shareholders are being asked to elect threefour individuals to serve on the Board of Directors.

Recommendation: Your Board of Directors recommends a vote FOR the election of the nominees.

The current Board of Directors has nominated Nolan D. Archibald, David C. Everitt and Roger J. Wood nominated:

 

MANUEL A. FERNANDEZ

MARK D. SCHWABERO

DAVID V. SINGER

J. STEVEN WHISLER

for election as directorsDirectors to serve for terms expiring at the 20192021 Annual Meeting, or until their respective successors have been elected and qualified.

 

The Board of Directors currently has ten10 members divided among three classes, one of which consists of four directors and two of which consist of three directors. As explained in further detail in Proposal 2, the Board of Directors has approved, and is recommending our shareholders approve, amendments to our Restated Certificate of Incorporation to declassify the Board of Directors. If Proposal 2 is approved by our shareholders at the Annual Meeting, beginning with the annual meeting of shareholders to be held in 2019, Director nominees will, if elected, serve for one-year terms. However, the approval or disapproval of Proposal 2 by our shareholders will not affect the length of the term that Messrs. Fernandez, Schwabero, Singer, and Whisler will, if elected at the Annual Meeting, serve or the length of the existing terms of our other current Directors.

Biographical information follows for each nominee and each directorDirector whose term of office will continue after the Annual Meeting. Additional information is set forth below regarding the specific experience, qualifications, attributes, or skills of each member of the Board of Directors that led the Board to conclude that such individualindividuals should serve on the Board in light of the Company’sour business and leadership structure.

 

Nominees for Election for Terms Expiring at the 2019 Annual MeetingDIRECTOR NOMINEE SUMMARY

 

Nolan D. Archibald 

2018 PROXY STATEMENT | 12
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

Director since 1995ELECTION OF DIRECTOR NOMINEES FOR TERMS EXPIRING AT THE 2021 ANNUAL MEETING

MANUEL A. FERNANDEZ

 

Retired; Executive

Chairman, CEO, & President of Stanley Black & Decker, Inc., a consumerGartner Group (Retired)

Director Since: 1997

Age: 71

Committees:

Nominating and commercial products company, 2010 to 2013; Chairman, PresidentCorporate Governance (Chair)

Executive

Human Resources and Chief Executive Officer of The Black & Decker Corporation, 1986 to 2010; recipient of the American Marketing Association’s Edison Achievement Award; director of Huntsman Corporation and Lockheed Martin Corporation; age 72; serves as the Chair of the Finance Committee.Compensation

LEAD INDEPENDENT DIRECTOR

 

As the former Executive Chairman and Chief Executive Officer of a global consumerleading technology company and commercial products company, with more than 25 yearsthe Managing Director of experience in those roles,a venture capital partnership, Mr. ArchibaldFernandez brings significant experience and knowledge to our Board regarding strategic planning, innovation, technology, acquisitions, corporate governance, distribution, operations, and human resources. Mr. Fernandez’s extensive experience in a variety of businesses with strong commercial product offerings, including three technology companies, allows him to provide invaluable advice and guidance to our Company’s management and Board.

Experience:

Retired; Chairman, Chief Executive Officer, and President of Gartner Group, a technology research and advisory firm, 1991 to 1999; Executive Chairman of Sysco Corporation, a marketer and distributor of foodservice products, 2012 to 2013; Non-Executive Chairman of Sysco Corporation, 2009 to 2012; Managing Director, SI Ventures, LLC, a venture capital partnership, from 1998 to present. Previously served as President and Chief Executive Officer at Dataquest, Inc., Gavilan Computer Corporation, and Zilog Incorporated. Director of SI Ventures, LLC, Leggett and Platt Incorporated, and Performance Food Group; previously served as Chairman of the University of Florida Board of Trustees, Chairman Emeritus of Gartner, Inc., Director of Flowers Foods, Inc., Stanley Black & Decker, Inc., Tibco Software, Inc., and Time Inc.

KEY SKILLS AND EXPERTISE

Audit/Finance

 

Global

 

Operations/Manufacturing

 

Technology

 

CEO

 

Public Company Board

 

Regulatory/Legal/Governance

 

Diverse


MARK D. SCHWABERO

Chairman & CEO of Brunswick Corporation

Director Since: 2014

Age: 65

Committees:

Executive

As the Chairman and Chief Executive Officer of the Company and as the former Vice President and President of Mercury Marine, Brunswick’s largest operating division, Mr. Schwabero’s roles have provided him with extensive knowledge of and experience with our businesses and industries, allowing him to communicate effectively about our operations and business strategy with the Board. Mr. Schwabero is uniquely qualified to assist the Board on strategic and operating issues facing the Company. Based on his various roles within Brunswick and his prior experience, Mr. Schwabero brings comprehensive management and manufacturing experience to our Board and, as former Chairman of the National Marine Manufacturers Association, understands the operations, financial, and marketing challenges facing companies in the marine market.

Experience:

Chairman and Chief Executive Officer of Brunswick Corporation, February 2016 to present; President and Chief Operating Officer of Brunswick Corporation, 2014 to February 2016; Vice President and President—Mercury Marine, 2008 to 2014; President—Mercury Outboards, 2004 to 2008. Previously served as President and Chief Executive Officer of Hendrickson International; President, Automotive Products and Regional President for Pilkington Libby-Owens Ford; President of Bosch Braking Systems, North America; and positions of increasing responsibility in over 17 years with Navistar International; Director of 1st Source Corporation.

KEY SKILLS AND EXPERTISE

Audit/Finance

 

Global

 

Operations/Manufacturing

 

Dealers/Distribution

 

CEO

 

Marine/Fitness Industry

 

Public Company Board


2018 PROXY STATEMENT | 13
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

ELECTION OF DIRECTOR NOMINEES FOR TERMS EXPIRING AT THE 2021 ANNUAL MEETING

DAVID V. SINGER

CEO of
Snyder’s-Lance, Inc. (Retired)

Director Since: 2013

Age: 62

Committees:

Audit

Finance

As the former Chief Executive Officer of a maker and global marketer of snack foods and through his director and public company audit committee roles, Mr. Singer brings extensive management and financial experience to our Board, as well as experience in supply chain, manufacturing, logistics, and distribution matters. Mr. Singer’s experience in corporate finance, governance, and acquisitions is beneficial to the Board in several areas including oversight of business management, strategic planningexternal auditors and internal controls.

Experience:

Retired; Chief Executive Officer of Snyder’s-Lance, Inc., a leading snack food company, 2010 to 2013; President and Chief Executive Officer of Lance, Inc., 2005 to 2010; Executive Vice President and Chief Financial Officer of Coca-Cola Bottling Company Consolidated, 2001 to 2005. Director of Flowers Foods, Inc., Hanesbrands, Inc., and SPX Flow, Inc.; previously served as Director of Lance, Inc. and Snyder’s-Lance, Inc.

KEY SKILLS AND EXPERTISE

Audit/Finance

 

Operations/Manufacturing

 

Marketing

 

Dealers/Distribution

 

CEO

 

Public Company Board


J. STEVEN WHISLER

Chairman & CEO of Phelps Dodge Corporation (Retired)

Director Since: 2007

Age: 63

Committees:

Human Resources and Compensation (Chair)

Executive

Nominating and Corporate Governance

As the former Chairman and Chief Executive Officer of a mining and manufacturing company with operations on several continents, Mr. Whisler has extensive experience with international business operations.operations and regulatory compliance matters. Additionally, Mr. Archibald is also well-suitedWhisler’s background enables him to provide strategic advice and guidance to our Company’s management and Board in regard to a wide variety ofregarding financial, issues.human resources, and risk oversight matters.

 

David C. Everitt

Director since 2012

Experience:

Retired; President, Agricultural and Turf Division - North America, Asia, Australia, and Sub-Saharan and South Africa, and Global Tractor and Turf Products of Deere & Company, the world’s largest manufacturer of agricultural equipment and a major U.S. producer of construction, forestry and lawn and grounds care equipment, 2009 to 2012; President, Agricultural Division — North America, Australia, Asia and Global Tractor and Implement Sourcing, 2006 to 2009; President, Agricultural Division — Europe, Africa, South America and Global Harvesting Equipment Sourcing, 2001 to 2006; director of Agrium Inc., Allison Transmission Holdings, Inc. and Harsco Corporation; age 63.

As the former President of Deere & Company’s largest division, Mr. Everitt brings his engineering experience, global expertise and extensive knowledge of dealer and distribution issues to our Board.

Roger J. Wood

Director since 2012

Retired; PresidentChairman and Chief Executive Officer of Dana HoldingPhelps Dodge Corporation, a world leadermining and manufacturing company, 2000 to 2007; employed by Phelps Dodge Corporation in the supplya number of axles, driveshafts, off-highway transmissions, sealing and thermal-management products and genuine service parts, 2011 to 2015; Group President, Engine of BorgWarner, Inc., a worldwide automotive industry components and parts supplier, 2010 to 2011; Executive Vice President of BorgWarner, Inc., 2009 to 2011; President of BorgWarner Turbo Systems Inc. and BorgWarner Emissions Systems Inc., 2005 to 2009; director of Tenneco Inc. and Fallbrook Technologies; previously served as director of Dana Holding Corporation; age 53.

As the formerpositions since 1976, including President and Chief Executive OfficerOperating Officer. Director of Dana,CSX Corporation and given his many yearsInternational Paper Company (Presiding Director 2009 to 2017). Previously served as Director of service at another Tier-1 automotive supplier, Mr. Wood has unique insightBurlington Northern Santa Fe Corporation and brings significant knowledge to the Board in the areas of manufacturing operations, business management and strategic planning.U.S. Airways Group, Inc.

KEY SKILLS AND EXPERTISE

Audit/Finance

 

Global

 

Operations/Manufacturing

 

Technology

 

Dealers/Distribution

 

CEO

 

Public Company Board

 

Regulatory/Legal/Governance


 

Your Board of Directors recommends a vote FOR the election of the nominees named above.

BRUNSWICK CORPORATION-2016 Proxy Statement12

2018 PROXY STATEMENT | 14
 
Back to Contents
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

Directors Continuing in Office until the 2017 Annual Meeting

DIRECTORS CONTINUING IN OFFICE UNTIL THE 2020 ANNUAL MEETING

NANCY E. COOPER

 

Nancy E. Cooper

Director since 2013

 

Retired; Executive Vice President and Chief Financial Officer& CFO of CA Technologies, Inc., one of the largest independent software corporations in the world, 2006 to 2011; Chief Financial Officer of IMS Health, Inc., a global information and technology services company, 2001 to 2006; director of Guardian Life Insurance Company of America, The Mosaic Company and Teradata Corporation; age 62; serves as the Chair of the (Retired)

Director Since: 2013

Age: 64

Committees:

Audit Committee.(Chair)

Executive

 

As the former Executive Vice President and Chief Financial Officer of CA Technologies, Ms. Cooper brings financial acumen and technology experience to our Board. Ms. Cooper’s extensive experience as a Chief Financial Officer and her other financial leadership roles for several companies, as well as her service on the audit committees of two other public companies, will assistassists the Board in several areas including finance, internal control, and audit.audit matters.

 

RalphExperience:

Retired; Executive Vice President and Chief Financial Officer of CA Technologies, Inc., one of the largest independent software corporations in the world, 2006 to 2011; Chief Financial Officer of IMS Health, Inc., a global information and technology services company, 2001 to 2006. Director of The Mosaic Company, Guardian Life Insurance Company of America, and Aptiv PLC; previously served as Director of Teradata Corporation.

KEY SKILLS AND EXPERTISE

Audit/Finance

 

Global

 

Technology

 

Public Company Board

 

Diverse


RALPH C. StayerSTAYER

Chairman of Johnsonville Sausage, LLC

Director since Since: 2002

Age: 74

Committees:

Audit

Finance

As the leader of a successful consumer-focused private enterprise, Mr. Stayer brings extensive management experience to the Board in the areas of effective competition, production, distribution, marketing, and financial matters. Additionally, Mr. Stayer’s writing, teaching, and consulting work relating to organizational development and leadership enable him to provide our management and Board with advice and guidance in relation to strategic, organizational, and individual development.

Experience:

Chairman, Johnsonville Sausage, LLC, a maker of sausage products, since 1980; President and Chief Executive Officer of Johnsonville Sausage, LLC, 1980 to 2015; Founder of Leadership Dynamics, a consulting firm; Member of the Board of Trustees of Boston College; age 72.Director of Hometown Bank; and Trustee of the Baylor Art Museum.

KEY SKILLS AND EXPERTISE

Audit/Finance

 

Global

 

Operations/Manufacturing

 

Marketing

 

Dealers/Distribution

 

CEO


2018 PROXY STATEMENT | 15
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

DIRECTORS CONTINUING IN OFFICE UNTIL THE 2020 ANNUAL MEETING

JANE L. WARNER

 

As

Executive Vice President Decorative Surfaces and Finishing Systems of Illinois Tool Works Inc. (Retired)

Director Since: 2015

Age: 71

Committees:

Finance

Nominating and Corporate Governance

With almost 40 years of experience in global manufacturing and manufacturing information systems businesses, Ms. Warner has particular appreciation for the leader of a successful consumer-focused private enterprise, Mr. Stayer brings extensive management experience tochallenges facing our operations, distribution network, and customers. Her leadership roles in these diverse companies, along with the financial understanding she has gained through her business unit leadership, assists our Board in working through the areas of effective competition, production, distribution and financial matters. Additionally, Mr. Stayer’s writing, teaching and consulting work relating to organizational development and leadership enable him to provideissues that confront our Company’s management and Board with advice and guidance in relation to strategic, organizational and individual development.global businesses.

 

Jane L. Warner

Director since 2015

Experience:

Retired; Executive Vice President -DecorativePresident—Decorative Surfaces and Finishing Systems of Illinois Tool Works Inc., a diversified manufacturer of highly engineered components and industrial systems and consumables, 2007 to 2013; Group President of Global Finishing Systems of Illinois Tool Works Inc., 2005 to 2007; President of Plexus Systems, L.L.C. (now known as Plex), an online manufacturing software company, 2004 to 2005; Vice President of Electronic Data Systems, 2000 to 2004; Executive Vice President and President of Kautex North America and Randall divisions for Textron Automotive, 1994 to 1999. Formerly, Ms. Warner held executive positions in manufacturing, engineering, and human resources over a 20-year span at General Motors Corporation; directorCorporation. Director of Regal Beloit Corporation and Tenneco Inc.; previously served as directorDirector of MeadWestvaco Corporation; age 69.Corporation.

KEY SKILLS AND EXPERTISE
 

Global

 

Operations/Manufacturing

 

Technology

 

Dealers/Distribution

 

Public Company Board

 

Diverse


 

With almost 40 years of experience at global manufacturing and manufacturing information systems businesses, Ms. Warner has particular appreciation for the challenges facing our operations, distribution network and customers. Her leadership roles in these diverse companies, along with the financial understanding she has gained through her business unit leadership, will assist our Board in working through the issues that confront our global businesses.DIRECTORS CONTINUING IN OFFICE UNTIL THE 2019 ANNUAL MEETING

NOLAN D. ARCHIBALD

 

BRUNSWICK CORPORATION -2016 Proxy Statement13

Back to Contents

Directors Continuing in Office until the 2018 Annual Meeting

 

Manuel A. Fernandez

Director since 1997

Retired; Executive Chairman of Sysco Corporation, a marketer and distributor of foodservice products, 2012 to 2013; Non-Executive Chairman of Sysco Corporation, 2009 to 2012; Managing Director, SI Ventures, LLC, a venture capital partnership, since 1998; Chairman, Chief Executive Officer and President of Gartner Group, a technology research and advisory firm, 1991 to 1999; previously served as President and Chief Executive Officer at Dataquest, Inc, Gavilan Computer Corporation and Zilog Incorporated; director of Leggett and Platt Incorporated and Time Inc.; previously served as Chairman of the University of Florida Board of Trustees, Chairman Emeritus of Gartner, Inc., director of Flowers Foods, Inc., Stanley Black & Decker, Inc. and Tibco Software, Inc.; age 69; serves as the Lead Independent (Retired)

Director and as Chair of the Nominating and Corporate Governance and Qualified Legal Compliance Committees.Since: 1995

Age: 74

Committees:

Finance (Chair)

Executive

 

As the former Executive Chairman and Chief Executive Officer of a foodserviceglobal consumer and commercial products company, and the Managing Directorwith more than 25 years of a venture capital partnership,experience in those roles, Mr. FernandezArchibald brings significant experience and knowledge to our Board regardingin the areas of business management, strategic planning, acquisitions, corporate governancemarketing, and human resources.international business operations. Mr. Fernandez’s extensive experience in information technology, including his role as Chairman and Chief Executive Officer of a leading information technology company, as well as with a variety of businesses with strong commercial product offerings, allows himArchibald is also well-suited to provide invaluable advice and guidance to our Company’s management and Board regarding innovation, technology strategy and distribution.on a wide variety of financial issues.

 

Mark D. SchwaberoExperience:

Director since 2014

Retired; Executive Chairman of Stanley Black & Decker, Inc., a consumer and Chief Executive Officer of Brunswick Corporation since February 2016; President and Chief Operating Officer of Brunswick Corporation, 2014commercial products company, 2010 to February 2016; Vice President and President — Mercury Marine, 2008 to 2014; President — Mercury Outboards, 2004 to 2008; previously served as2013; Chairman, President, and Chief Executive Officer of Hendrickson International, The Black & Decker Corporation, 1986 to 2010; recipient of the American Marketing Association’s Edison Achievement Award in 1996; Director of Huntsman Corporation and Lockheed Martin Corporation.

KEY SKILLS AND EXPERTISE

Audit/Finance

 

Global

 

Operations/Manufacturing

 

Marketing

 

Dealers/Distribution

 

CEO

 

Public Company Board


2018 PROXY STATEMENT | 16
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

DIRECTORS CONTINUING IN OFFICE UNTIL THE 2019 ANNUAL MEETING

DAVID C. EVERITT

President, Automotive ProductsAgricultural and Regional President for Pilkington Libby-Owens Ford,Turf Division of Deere & Company (Retired)

Director Since: 2012

Age: 65

Committees:

Human Resources and Compensation

Nominating and Corporate Governance

As the former President of Bosch Braking Systems, Deere & Company’s largest division, Mr. Everitt brings his engineering experience, global expertise, and extensive knowledge of dealer and distribution issues to our Board. Mr. Everitt also provides crucial operations, manufacturing, and marketing experience.

Experience:

Retired; President, Agricultural and Turf Division—North America, Asia, Australia, and positionsSub-Saharan and South Africa, and Global Tractor and Turf Products of increasing responsibility in over 17 years with Navistar International; directorDeere & Company, the world’s largest manufacturer of 1st Sourceagricultural equipment and a major U.S. producer of construction, forestry, and lawn and grounds care equipment, 2009 to 2012; President, Agricultural Division—North America, Australia, Asia and Global Tractor and Implement Sourcing, 2006 to 2009; President, Agricultural Division—Europe, Africa, South America and Global Harvesting Equipment Sourcing, 2001 to 2006. Director of Nutrien Ltd., Allison Transmission Holdings, Inc., and Harsco Corporation; age 63.previously served as Director of Agrium Inc.

KEY SKILLS AND EXPERTISE
 

Global

 

Operations/Manufacturing

 

Marketing

 

Dealers/Distribution

 

Public Company Board


ROGER J. WOOD

Chairman & CEO of Fallbrook Technologies Inc.

Director Since: 2012

Age: 55

Committees:

Audit

Finance

 

As the Chairman and Chief Executive Officer of an advanced technology company focused on mechanical devices, Mr. Wood brings substantial expertise regarding technology and as the former President and Chief Operating Officer of Brunswick Corporation, Mr. Schwabero’s roles have provided him with extensive knowledge of our businesses and industries and allow himcustomer solutions to communicate effectively about our operations and business strategy with the Board. Mr. Schwabero has extensive knowledge of the Company and is uniquely qualified to assist the Board on strategic and operating issues facing the Company. Based on his various roles within Brunswick and prior experience, Mr. Schwabero brings comprehensive management and manufacturing experience to our Board and, as former Chairman of the National Marine Manufacturers Association, understands the operations, finances and marketing challenges facing companies in the marine market.

David V. Singer

Director since 2013

Retired; Chief Executive Officer of Snyder’s-Lance, Inc., a leading snack food company, 2010 to 2013;Formerly President and Chief Executive Officer of LanceDana Holding Corporation, Mr. Wood’s experience and work there and at another Tier-1 automotive supplier provide unique insight and significant knowledge to the Board in the areas of manufacturing operations, business management, global operations, and strategic planning.

Experience:

Chairman and Chief Executive Officer, Fallbrook Technologies Inc., a privately held technology developer and manufacturer, February 2018 to present; President and Chief Executive Officer of Dana Holding Corporation, a world leader in the supply of axles, driveshafts, off-highway transmissions, sealing and thermal-management products, and genuine service parts, 2011 to 2015; Group President, Engine of BorgWarner, Inc., a worldwide automotive industry components and parts supplier, 2010 to 2011; Executive Vice President of BorgWarner Inc., 2009 to 2011; President of BorgWarner Turbo Systems Inc. and BorgWarner Emissions Systems Inc., 2005 to 2010; Executive Vice President and Chief Financial Officer2009. Director of Coca-Cola Bottling Company Consolidated, 2001 to 2005; director of Flowers Foods, Inc., Hanesbrands, Inc. and SPX Flow,Tenneco Inc.; previously served as directorLead Director of LanceFallbrook Technologies Inc. and Snyder’s-Lance, Inc.; age 60.Director of Dana Holding Corporation.

KEY SKILLS AND EXPERTISE

Audit/Finance

 

Global

 

Operations/Manufacturing

 

CEO

 

Public Company Board

 

Technology


 

As the former Chief Executive Officer of a maker and marketer of snack foods throughout the world and through his director and public company audit committee roles, Mr. Singer brings extensive management and financial experience to our Board, as well as experience in supply chain, manufacturing, logistics and distribution matters. Mr. Singer also offers experience in corporate finance, governance and acquisitions.

J. Steven Whisler

Director since 2007

Retired; Chairman and Chief Executive Officer of Phelps Dodge Corporation, a mining and manufacturing company, 2000 to 2007; employed by Phelps Dodge Corporation in a number of positions since 1976, including President and Chief Operating Officer; director of CSX Corporation and lead director of International Paper Company; previously served as director of Burlington Northern Santa Fe Corporation and U.S. Airways Group; age 61; serves as the Chair of the Human Resources and Compensation Committee.

As the former Chairman and Chief Executive Officer of a mining and manufacturing company with operations on several continents, Mr. Whisler has extensive experience with international business operations and regulatory compliance matters. Additionally, Mr. Whisler’s background enables him to provide strategic advice and guidance to our Company’s management and Board regarding financial, human resources and risk oversight matters.

BRUNSWICK CORPORATION -2016 Proxy Statement14

2018 PROXY STATEMENT | 17
 
Back to Contents
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

Board Committees

CORPORATE GOVERNANCE

 

The Board of Directors has six committees: Audit, Finance, Human Resources and Compensation, Nominating and Corporate Governance, Qualified Legal Compliance and Executive. Each committee is comprised solely of independent directors, as that standard is determined by the Board’sadopted written Principles and Practices (the Principles) and the New York Stock Exchange (NYSE) Listed Company Manual, with the exception of the Executive Committee, of which Mr. Schwabero is a member. Each of the committees may, at its sole discretion and at Brunswick’s expense, obtain advice and assistance from outside legal, financial, accounting or other experts and advisors. The following table shows the current membership of these committees:

Name Audit Finance Human Resources
 and Compensation
Nominating
and Corporate
Governance
Qualified Legal
Compliance
 Executive
Nolan D. ArchibaldX*X
Nancy E. CooperX*XX
David C. EverittXXX
Manuel A. FernandezXX*X*X
Mark D. SchwaberoX
David V. SingerXX
Ralph C. StayerXX
Jane L. WarnerXXX
J. Steven WhislerX*XXX
Roger J. WoodXX
*Committee Chair

The principal responsibilities of each of these committees are described generally below and in detail in their respective committee charters, which are available aton the Brunswick website, www.brunswick.com/company/governance/committees.htmlprinciplespractices.php, or in print upon request by any Brunswick shareholder. The Principles set the framework for our governance structure. The Board believes that good corporate governance is a source of competitive advantage for Brunswick. Good governance allows the skills, experience, and judgment of the Board to support our executive management team, enabling management to improve our performance and maximize shareholder value.

 

Audit Committee

Members ofAs set forth in the Audit CommitteePrinciples, the Board’s responsibilities include overseeing and directing management in building long-term value for shareholders. The Chief Executive Officer (CEO) and the senior management team are Ms. Cooper (Chair), Mr. Singer, Mr. Stayerresponsible for managing day-to-day business operations and Mr. Wood.for presenting regular updates to the Board about our business. The Board has determined that each member ofoffers the Audit Committee is a “financial expert” as that term is defined by SEC rules.CEO and management constructive advice and counsel and may, in its sole discretion and at the Company’s expense, obtain advice and counsel from independent legal, financial, accounting, compensation, and other advisors.

 

The Audit Committee assistsBoard of Directors met six times during 2017. Our directors collectively attended 96 percent of the 2017 Board and committee meetings. The Principles provide that all members of the Board in overseeingare requested to attend Brunswick’s accounting, auditing and reporting practices, its independent registered public accounting firm, its systemAnnual Meeting of internal controls andShareholders. All members of the integrityBoard attended the 2017 Annual Meeting of its financial information and disclosures. The Committee reviews certain regulatory and compliance matters, policies regarding risk assessment and risk management, cybersecurity and corporate tax strategy. The Audit Committee maintains free and open communication, and meets separately at each regularly scheduled Board meeting with the Company’s independent registered public accounting firm, its internal auditors and management.Shareholders.

 

The Audit Committee met eleven times during 2015.independent directors regularly meet in executive session without members of management present. The Lead Independent Director, Manuel A. Fernandez, presides and acts as the Board’s leader when it meets in executive session or when the Chairman and CEO is unable to lead the Board’s deliberations. Additionally, the Lead Independent Director serves as a liaison between management and the Board and is responsible for consulting with the Chairman and CEO regarding Board and committee meeting agendas and Board governance matters.

 

Finance CommitteeBOARD COMPOSITION:

 

Members of the Finance Committee are Mr. Archibald (Chair), Mr. Singer, Mr. Stayer, Ms. Warner and Mr. Wood. The Finance Committee assists

2018 PROXY STATEMENT | 18
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

BOARD QUALIFICATIONS

Among other things, the Board expects each Director to understand our business and the markets in overseeing Brunswick’s financialwhich we operate, monitor economic and business trends, and use his or her perspective, background, experience, and knowledge to provide management with insights and guidance. To that end, the Board is comprised of business savvy Directors with strategic mindsets and meaningful operational skills. The Board continually monitors its members’ skills and experience and considers its members’ expertise for succession planning and committee assignments. As part of this evaluation process, the Board and its committees conduct annual self-evaluations and the Lead Independent Director may also engage individual Board members regarding Board or Committee performance. Every three years, the Board engages a third party to interview Directors. This third party also provides feedback on Board performance and financial structure, including debt structure, financial policies and procedures, capital expenditures and capital expenditure budgets. The Committee also reviews proposals for corporate financing, short-term and long-term borrowings, the declaration and distribution of dividends, material investments and divestitures, share repurchases, insurance coverage and related matters, as well as the funding and performance of Brunswick’s pension plans.relative to peers.

 

The Finance Committee met five times during 2015.

DIVERSITY OF EXPERIENCE

 

Human Resources and Compensation Committee

2018 PROXY STATEMENT | 19
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

BOARD SELECTION AND REFRESHMENT

 

Members of the Human Resources and Compensation Committee (the Compensation Committee) are Mr. Whisler (Chair), Mr. Everitt and Mr. Fernandez. The Compensation Committee’s responsibilities, among other duties, include the following:THE NOMINATING AND CORPORATE GOVERNANCE COMMITTEE
CANDIDATE SELECTION PROCESS

DIRECTOR CANDIDATE CONSIDERATIONS

 

Annually review and approve goals and objectives for Brunswick’s senior executives; together with the Chief Executive Officer, evaluate the performance of senior executives in light of these criteria; and oversee management development and succession planning;INTEGRITY
  
Annually review and make recommendations to the Board of Directors about the compensation (including salary, annual incentive and other cash compensation) of the Chief Executive Officer and, together with the Nominating and Corporate Governance Committee, oversee the annual review of the Chief Executive Officer’s performance;EXPERIENCE
  
Approve equity awards to the Chief Executive Officer and compensation (including salary, annual incentive, stock options and other equity-based and other incentive compensation) to be paid to other senior executives, and authorize the Chief Executive Officer to approve awards to employees other than senior executives based on criteria established by the Compensation Committee; andACHIEVEMENTS
JUDGMENT
INTELLIGENCE
PERSONAL CHARACTER
ABILITY TO MAKE INDEPENDENT ANALYTICAL INQUIRIES
WILLINGNESS TO DEVOTE TIME TO BOARD DUTIES
LIKELIHOOD OF BOARD TENURE

 

The Board and the Nominating and Corporate Governance Committee (“Governance Committee”) believe that a diverse Board of Directors is important. Therefore, additional consideration is given to achieving an overall diversity of perspectives, backgrounds, and experiences in Board membership. The Governance Committee may retain a third-party search firm to assist it with identifying qualified candidates.

The Principles require a non-employee Director to retire from the Board at the first annual meeting of shareholders following his or her 75th birthday, and for an employee Director to retire when he or she ceases employment with Brunswick.

The Governance Committee will consider qualified Director candidates who shareholders suggest by written submissions to:

Brunswick Corporation

BRUNSWICK CORPORATION26125 N. Riverwoods Blvd., Suite 500
Mettawa, IL 60045

Attention: Corporate Secretary’s Office

fax: 847.735.4433 -2016or email: corporate.secretary@brunswick.com

Any recommendation a shareholder submits must include the name of the candidate, a description of the candidate’s educational and professional background, contact information for the candidate, and a brief explanation of why the shareholder believes the candidate is suitable for election. The Governance Committee will apply the same standards in considering Director candidates recommended by shareholders as it applies to other candidates.

In addition to recommending Director candidates to the Governance Committee, shareholders may also, pursuant to procedures established in our Amended By-Laws, directly nominate one or more Director candidates to stand for election through our advance notice or proxy access procedures. In order for a shareholder nominee to be included in our Proxy Statement15 for an annual meeting, the nomination notice must be provided between 120 and 150 days before the anniversary date that we first mailed our Proxy Statement for the annual meeting of the previous year, and must comply with all applicable requirements in the Amended By-Laws. To nominate Director candidates to stand for election at an annual meeting of shareholders without including them in our proxy materials, a shareholder must deliver written notice of the nomination to Brunswick’s Secretary not less than 90 days nor more than 120 days prior to the anniversary date of the immediately preceding annual meeting of shareholders. For a special meeting of shareholders, a shareholder wishing to make such a nomination must deliver written notice of the nomination to Brunswick’s Secretary no later than the close of business on the tenth day following the date on which notice of the meeting is first given to shareholders. In any case, a notice of nomination submitted by a shareholder must include information concerning the nominating shareholder and the shareholder’s nominee(s) as required by our Amended By-Laws.


2018 PROXY STATEMENT | 20
 
Back to Contents
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

Oversee the development of a compensation philosophy for the Company that is consistent with its long-term strategic goals and does not encourage unnecessary risk-taking.

BOARD LEADERSHIP

 

The Compensation Committee meets in conjunction with regularly scheduled meetingsBoard of Directors believes that having the Company’s CEO serve as Chairman of the Board is in the best interest of Directorsshareholders at this time because this structure ensures a seamless flow of communication between management and as otherwise required. The Chairman and Chief Executive Officer,the Board, in particular with respect to the Board’s oversight of our strategic direction, as well as the Vice PresidentBoard’s ability to ensure management’s focused execution of that strategy. Our strong Lead Independent Director position ensures that there are processes in place for robust and Chief Human Resources Officer, regularly attend meetings. At each meeting,independent Board oversight. The Board believes that the Committee meets incombined role of Chairman and CEO, together with the appointment of a Lead Independent Director by the other independent Directors, a substantial majority of independent Directors, and the use of regular executive session.sessions of non-management Directors achieves an appropriate balance between the effective development of key strategic and operational objectives and independent oversight of management’s execution of those objectives.

 

The Chairman and Chief Executive Officer is responsible for establishing strategies to achieveAdditionally, the Company’s objectives. To ensureBoard believes that executive compensation is consistent with those objectives,because the Chairman and Chief Executive OfficerCEO is responsible for making recommendationsthe Director most familiar with our business, industry, and day-to-day operations, he is well-positioned to help the Board focus on those issues of greatest importance to the Compensation CommitteeCompany and its shareholders and to assist the Board with identifying our strategic priorities, as well as the short-term and long-term risks and challenges facing us. While independent Directors have invaluable experience and expertise from outside the Company and its businesses, giving them different perspectives regarding the following: compensationdevelopment of our strategic goals and principles;objectives, the peer group of companiesCEO is well-suited to be usedbring Company-specific experience and industry expertise to determine compensation ranges and prevailing compensation practices; selection of performance targets for incentive plans,his discussions with input from other senior executives; performance rating and compensation actions to be taken; and salary increases, incentive awards and equity grants for senior executives.non-management Directors.

 

The Compensation Committee collaborates with the Chairman and Chief Executive Officer to develop incentive funding formulas for Brunswick divisions, and for conducting performance evaluations, talent development and succession planning for senior executives. The Committee establishes criteria pursuant to which Brunswick’s senior executives allocate equity awards to non-executive employees, and oversees Brunswick’s Human Resources Department in its administration of compensation and benefit plans.RECENT FOCUS AREAS

 

The Compensation Committee continues to engage Frederic W. Cook & Co., Inc. (FWC) to provide advice on various aspects of Brunswick’s executive compensation programs. The Committee meetsOur Board is active and engaged, not only providing outstanding oversight and governance, but also refining procedures consistent with FWC in executive session on a regular basis and FWC reports directly to the Committee. The Compensation Committee has assessed the independence of FWC pursuant to applicable SEC rules and NYSE listing standards and has concluded that FWC’s work for the Compensation Committee does not raise any conflict of interest.current best practices.

 

The Compensation Committee met six times during 2015.

Acquisitions, portfolio composition, and strategic growth plans
Technology and data security initiatives
Director and management succession planning
March 2018 announcement of spin-off transaction creating two focused companies

 

Nominating and Corporate Governance Committee

Members of the Nominating and Corporate Governance Committee are Mr. Fernandez (Chair), Mr. Everitt, Ms. Warner and Mr. Whisler. The Nominating and Corporate Governance Committee assists the Board in overseeing policies and programs designed to ensure Brunswick’s adherence to high corporate governance and ethical standards and compliance with applicable legal and regulatory requirements. Together with the Compensation Committee, it oversees the annual review of the Chairman and Chief Executive Officer’s performance. The Committee identifies, screens, interviews and recommends to the Board potential director nominees, and oversees other matters related to Board composition, performance, standards, size and membership, including ensuring appropriate diversity of perspective, background and experience in Board membership.

The Nominating and Corporate Governance Committee has responsibility for making recommendations regarding director compensation design to theOn March 1, 2018, we announced that our Board of Directors had authorized proceeding with a spin-off of the Fitness business. Following the proposed transaction, the Fitness business, including billiards game tables and furnishings, will be an independent, standalone, publicly traded company. The Board designated members of the Executive Committee to oversee the transaction process. The proposed transaction is intended to be tax-free to Brunswick shareholders for reviewU.S. federal income tax purposes. Details of the distribution will be included in a Form 10 registration statement filed with the Securities and action. Brunswick’s Human Resources Department andExchange Commission at a later date. The proposed transaction is expected to be completed by the Company’s outside consultants provideend of the Nominating and Corporate Governance Committee with director compensation data as publicly reported, including data relatingfirst quarter 2019, subject to peer groupfinal approval from our Board and other similarly-sized companies, as well as data from published surveys.customary conditions.

DIRECTOR INDEPENDENCE

 

The Nominating and Corporate Governance Committee met six times during 2015.

Qualified Legal Compliance Committee

Members ofAs noted in the Qualified Legal Compliance Committee are Mr. Fernandez (Chair), Ms. Cooper, Mr. Everitt, Ms. Warner and Mr. Whisler. The Qualified Legal Compliance Committee receives and investigates reports made to it concerning possible material violations of law or breaches of fiduciary duty by the Company or any of its officers, directors, employees or agents. During 2015, no reports were made to the Qualified Legal Compliance Committee and, therefore, it did not meet.

Executive Committee

In addition to its standing committees,Principles, the Board of Directors has an Executive Committee, comprised of the Chairman of the Board, the Lead Independent Director and the Chairs of the Audit Committee, Finance Committee, Compensation Committee and Nominating and Corporate Governance Committee. The Executive Committee meets from time to time at the request of the Chairman of the Board. The Executive Committee did not meet during 2015.

BRUNSWICK CORPORATION -2016 Proxy Statement16

Back to Contents

Director Independence

The Principles requirebelieves that independent directors mustDirectors should constitute a substantial majority of the Board and that no more than two members of management may serve on the Board at the same time. The Principles provide that a directorDirector shall be considered to be independent if he or she satisfies the general directorDirector independence standards established by the NYSE. The NYSE standards provide that a directorDirector will not be independent unless the Board affirmatively determines that the directorDirector has no material relationship with Brunswick (either directly or as a partner, shareholder, or officer of an organization that has a relationship with Brunswick). In addition, the NYSE standards provide that a directorDirector is not independent if:

 

The directorDirector is, or within the prior three years has been, a Brunswick employee, or a member of the director’sDirector’s immediate family is, or within the prior three years has been, an executive officerExecutive Officer of Brunswick;
  
The directorDirector or an immediate family member of the directorDirector has received, during any 12-month period within the prior three years, more than $120,000 in direct compensation from Brunswick (excluding fees for Board and Board committee service, pension, or other forms of deferred compensation for prior service, provided such compensation is not contingent in any way on continued service);
  
Certain specified relationships exist between the director,Director, a member of the director’sDirector’s immediate family, and a firm that serves or has served as Brunswick’s internal or external auditor;
  
The directorDirector is a partner or employee of a firm that is Brunswick’s internal or external auditor;
  
A member of the director’sDirector’s immediate family is a partner of a firm that is Brunswick’s internal or external auditor, or is an employee of such a firm and personally works on Brunswick’s audit;
  
The directorDirector or an immediate family member was within the last three years a partner or employee of a firm that is or was Brunswick’s internal or external auditor and personally worked on Brunswick’s audit during that time;
  
The directorDirector or a member of the director’sDirector’s immediate family is, or within the prior three years has been, employed as an executive officer of any other business organization in which any of Brunswick’s current executive officers serve or served on that business organization’s compensation committee; or
  
The directorDirector is an employee of, or a member of the director’sDirector’s immediate family is a directorDirector or an executive officer of, a business organization that has made payments to, or received payments from, Brunswick for property or services in an amount which, in any of the last three fiscal years, exceeds the greater of $1.0 million or 2 percent of the business organization’s consolidated gross revenues.

 

Applying the NYSE standards described above, and considering all relevant facts and circumstances, the Board has made an affirmative determination that none of the non-management directorsDirectors has a material relationship with Brunswick and that all non-management directors,Directors, comprised of Mr. Archibald, Ms. Cooper, Mr. Everitt, Mr. Fernandez, Mr. Singer, Mr. Stayer, Ms. Warner, Mr. Whisler, and Mr. Wood are independent.


 

BRUNSWICK CORPORATION -2016 Proxy Statement17

2018 PROXY STATEMENT | 21
 
Back to Contents
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

SHAREHOLDER ENGAGEMENT

Our active investor relations efforts include regular and ongoing engagement with current and potential investors, financial analysts, and the media through conference calls, face-to-face investor meetings, correspondence, conferences, and other events. This ensures that management and the Board understand, consider, and address the issues that matter most to our shareholders. Since 2012, Brunswick has held an Investor Day at least every two years, most recently in November 2017. These Investor Days allow access to our top managers to discuss and explain our marine and fitness businesses, update the live and webcast audience on our progress against our current three-year plan, and outline our plans, strategies, and commitments for the next three years.

SHAREHOLDER COMMUNICATION

The Principles provide that our shareholders or other interested parties may, at any time, communicate in writing with the Board, the Lead Independent Director, or the non-management Directors as a group, by writing to:

Brunswick Corporation

CORPORATE GOVERNANCE26125 N. Riverwoods Blvd., Suite 500
Mettawa, IL 60045

Attention: Corporate Secretary’s Office

fax: 847.735.4433 or email: corporate.secretary@brunswick.com

 

OverviewThe General Counsel will review and distribute to the Board, the Lead Independent Director, or the non-management Directors as a group, as appropriate, copies of written communications received by any of these means, depending on the subject matter and facts and circumstances described in the communication. Communications that are not related to the duties and responsibilities of the Board, or are otherwise considered to be improper for submission to the intended recipient(s), will not be forwarded to the Board, the Lead Independent Director, or the non-management Directors.


BOARD COMMITTEES

 

The Board of Directors has adopted writtenfive committees: Audit, Finance, Human Resources and Compensation, Nominating and Corporate Governance, and Executive. Each committee is comprised solely of independent Directors, as that standard is determined by the Principles and Practices (the Principles) to assist itthe NYSE Listed Company Manual, with the exception of the Executive Committee, of which Mr. Schwabero is a member. Each of the committees may, at its sole discretion and at Brunswick’s expense, obtain advice and assistance from outside legal, financial, accounting, or other experts and advisors.

The following table shows the current membership of these committees:

AUDITFINANCEHUMAN RESOURCES
& COMPENSATION
NOMINATING &
CORPORATE GOVERNANCE
EXECUTIVE
N. ARCHIBALD
N. COOPER
D. EVERITT
M. FERNANDEZ
M. SCHWABERO
D. SINGER
R. STAYER
J. WARNER
S. WHISLER
R. WOOD

2018 PROXY STATEMENT | 22
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

BOARD COMMITTEES

The principal responsibilities of each of these committees are described generally below and in the performance of its duties and the exercise of its responsibilities. The Principlesdetail in their respective committee charters, which are available on Brunswick’s website,at www.brunswick.com/company/governance/principlespractices.phpcommittees.html, or in print upon request by any Brunswick shareholder.

AUDIT COMMITTEE

NUMBER OF TIMES THIS
COMMITTEE MET IN 2017:
11
NANCY E.
COOPER (C)
DAVID V.
SINGER
RALPH C.
STAYER
ROGER J.
WOOD


The Principles setAudit Committee assists the frameworkBoard in overseeing Brunswick’s accounting, auditing, and reporting practices, its independent registered public accounting firm, its system of internal controls, and the quality and integrity of its financial information and disclosures. The Committee reviews certain regulatory and compliance matters, policies regarding risk assessment and risk management, corporate tax strategy, cybersecurity, and our Information Security programs. The Audit Committee also receives and investigates any reports made to it concerning possible material violations of law or breaches of fiduciary duty by the Company or any of its officers, directors, employees, or agents. The Audit Committee maintains free and open communication, and meets separately at each regularly scheduled Board meeting with the Company’s independent registered public accounting firm, its internal auditors, and management.

FINANCE COMMITTEE

NUMBER OF TIMES THIS
COMMITTEE MET IN 2017:
5
NOLAN D.
ARCHIBALD (C)
DAVID V.
SINGER
RALPH C.
STAYER
JANE L.
WARNER
ROGER J.
WOOD

The Finance Committee assists the Board in overseeing Brunswick’s financial performance and financial structure, including debt structure, financial policies and procedures, capital expenditures, and capital expenditure budgets. The Committee also reviews proposals for corporate financing, short-term and long-term borrowings, the declaration and distribution of dividends, material investments and divestitures, share repurchases, insurance coverage, and related matters, as well as the funding and performance of Brunswick’s pension plans, hedging practices, and associated derivatives.

HUMAN RESOURCES AND COMPENSATION COMMITTEE

NUMBER OF TIMES THIS
COMMITTEE MET IN 2017:
7
J. STEVEN
WHISLER (C)
DAVID C.
EVERITT
MANUEL A.
FERNANDEZ

The responsibilities of the Human Resources and Compensation Committee (the Compensation Committee) include:

Annually review and approve goals and objectives for Brunswick’s senior executives; together with the CEO, evaluate the performance of senior executives in light of these criteria; and oversee management development and succession planning;
Annually review and make recommendations to the Board of Directors about the compensation (including salary, annual incentive, and other cash compensation) of the CEO and, together with the Governance Committee, oversee the annual review of CEO’s performance;
Approve equity awards to the CEO and compensation (including salary, annual incentive, equity-based compensation, and other incentive compensation) to be paid to other senior executives, and authorize the CEO to approve awards to employees other than senior executives based on criteria established by the Compensation Committee; and

2018 PROXY STATEMENT | 23
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

BOARD COMMITTEES

HUMAN RESOURCES AND COMPENSATION COMMITTEE (CONTINUED)

Oversee the development of a compensation philosophy for the Company that is consistent with its long-term strategic goals and does not encourage unnecessary risk-taking.

The Chairman and CEO, as well as the Vice President and Chief Human Resources Officer, regularly attend meetings of the Compensation Committee although they are not present for any discussions involving their own compensation or performance evaluations. At each meeting, the Committee meets in executive session.

The Chairman and CEO is responsible for establishing strategies to achieve the Company’s objectives. To ensure that executive compensation is consistent with those objectives, the Chairman and CEO is responsible for making recommendations to the Compensation Committee regarding the following: compensation goals and principles; the peer group of companies to be used to determine compensation ranges and prevailing compensation practices; selection of performance targets for incentive plans, with input from other senior executives; performance rating and compensation actions to be taken; and salary increases, incentive awards, and equity grants for senior executives.

The Compensation Committee collaborates with the Chairman and CEO to develop incentive funding formulas for Brunswick divisions, and for conducting performance evaluations, talent development, and succession planning for senior executives. The Committee establishes criteria pursuant to which Brunswick’s senior executives allocate equity awards to non-executive employees, and oversees Brunswick’s Human Resources Department in its administration of compensation and benefit plans.

The Compensation Committee continues to engage Frederic W. Cook & Co., Inc. (FW Cook) to provide advice on various aspects of Brunswick’s executive compensation programs. The Committee meets with FW Cook in executive session on a regular basis and FW Cook reports directly to the Committee. The Compensation Committee has assessed the independence of FW Cook pursuant to applicable SEC rules and NYSE listing standards and has concluded that FW Cook’s work for the Compensation Committee does not raise any conflict of interest.

NOMINATING AND CORPORATE GOVERNANCE COMMITTEE



NUMBER OF TIMES THIS
COMMITTEE MET IN 2017:
6
MANUEL A.
FERNANDEZ (C)
DAVID C.
EVERITT
JANE L.
WARNER
J. STEVEN
WHISLER


The Governance Committee assists the Board in overseeing policies and programs designed to ensure Brunswick’s adherence to high corporate governance structure.and ethical standards and compliance with applicable legal and regulatory requirements. Together with the Compensation Committee, it oversees the annual review of the Chairman and CEO’s performance. The Committee identifies, screens, interviews, and recommends to the Board potential director nominees, and oversees other matters related to Board composition, performance, standards, size, and membership, including ensuring appropriate diversity of perspective, background, and experience in Board membership.

The Governance Committee has responsibility for making recommendations regarding director compensation design to the Board of Directors for review and action. Our Human Resources Department and outside consultants provide the Governance Committee with director compensation data as publicly reported, including data relating to peer group and other similarly-sized companies, as well as data from published surveys.

EXECUTIVE COMMITTEE


NUMBER OF TIMES THIS
COMMITTEE MET IN 2017:
0
NOLAN D.
ARCHIBALD
NANCY E.
COOPER
MANUEL A.
FERNANDEZ
MARK D.
SCHWABERO
J. STEVEN
WHISLER

In addition to its standing committees, the Board of Directors has an Executive Committee, comprised of the Chairman of the Board, the Lead Independent Director, and the Chairs of the Audit, Finance, Compensation, and Governance Committees. The Executive Committee meets from time to time at the request of the Chairman of the Board.

2018 PROXY STATEMENT | 24
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

PROPOSAL 2: APPROVAL OF AMENDMENTS TO OUR RESTATED CERTIFICATE OF INCORPORATION TO DECLASSIFY THE BOARD OF DIRECTORS

What am I voting on? Shareholders are being asked to declassify the Board.

Voting Recommendation: Your Board of Directors recommends a vote FOR approval of amendments to our Restated Certificate of Incorporation to declassify the board.


Currently, our Restated Certificate of Incorporation, dated as of July 22, 1987 (our “Certificate of Incorporation”), divides the members of the Board into three classes. Each class is elected at an annual meeting of shareholders to hold office for a term beginning on the date of election and expiring at the annual meeting of shareholders held in the third year following the year of election. One class consists of four members whose terms expire upon the election and qualification of their successors at the Annual Meeting (“Class I”), one class consists of three members whose terms expire upon the election and qualification of their successors at the annual meeting of shareholders to be held in 2019 (“Class II”), and one class consists of three members whose terms expire upon the election and qualification of their successors at the annual meeting of shareholders to be held in 2020 (“Class III”).

After careful consideration, our Board has determined that it is advisable and in the best interests of the Company and its shareholders to declassify the Board to allow the Company’s shareholders to vote on the election of the entire Board on an annual basis, rather than on a staggered basis, and to provide that Directors may be removed with or without cause consistent with Delaware law.

This general description of the proposed amendments to our Certificate of Incorporation is qualified in its entirety by reference to the text of the proposed amendments attached as Appendix 1 to this Proxy Statement. Additions to our Certificate of Incorporation are marked with bolded text and deletions are indicated by strike-outs.

DECLASSIFICATION OF THE BOARD

If proposal 2 is approved by our shareholders at the Annual Meeting, the declassification of the Board will be effected as follows:

At the annual meeting of shareholders to be held in 2021 and at each annual meeting of shareholders to be held thereafter, all Directors will be elected annually;
The Class I Directors elected at the Annual Meeting will be elected for a term expiring at the annual meeting of shareholders to be held in 2021;
The Class II Directors will continue to serve the remainder of their elected terms, which expire at the annual meeting of shareholders to be held in 2019, and the Directors elected at the annual meeting of shareholders to be held in 2019 will be elected for a term expiring at the annual meeting of shareholders to be held in 2020; and
The Class III Directors will continue to serve the remainder of their elected terms, which expire at the annual meeting of shareholders to be held in 2020, and the Directors elected at the annual meeting of shareholders to be held in 2020 will be elected for a term expiring at the annual meeting of shareholders to be held in 2021.

If this proposal is approved by our shareholders, any Director appointed to fill a vacancy that did not arise from an increase in the size of the Board will hold office for the term that remains for the applicable vacating Director, and any Director elected to fill a vacancy that resulted from an increase in the size of the Board will be elected to serve until the next annual meeting of shareholders.

If this proposal is not approved by our shareholders, the Board will remain classified, with each class of directors serving a term expiring at the annual meeting of shareholders held in the third year following the year of their election.

REMOVAL OF DIRECTORS WITHOUT CAUSE

Delaware corporate law provides that, unless a company’s certificate of incorporation provides otherwise, members of a classified board of directors may be removed only for cause. At present, because the Board is classified, our Certificate of Incorporation provides that directors are removable only for cause. If this proposal is approved by our shareholders, our Certificate of Incorporation will be amended to remove this provision such that Directors may be removed with or without cause after the Board is no longer classified. If this proposal is not approved by our shareholders, the Board will remain classified and our shareholders will be able to remove directors only for cause.

If this proposal is approved by our shareholders, it will become effective when the Company files the amendments to the Certificate of Incorporation with the Secretary of State of the State of Delaware, which the Company intends to do promptly following the Annual Meeting, assuming shareholders approve the amendments.

CONSIDERATIONS OF THE BOARD

We have historically had a classified board structure in which Directors have been divided into three classes and one class is elected each year to serve a three-year term. The Board believes that goodthis classified board structure promotes continuity and stability of strategy, oversight, and policies, provides negotiating leverage to the Board in a potential takeover situation, and


2018 PROXY STATEMENT | 25
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

facilitates the Board’s ability to focus on creating long-term shareholder value. The Board is aware, however, that the current trend in corporate governance is leading away from classified boards in favor of electing all Directors annually, and that some argue that a sourceclassified board structure may reduce Directors’ accountability to shareholders because it does not enable shareholders to express a view on each Director’s performance through an annual vote. Some institutional investors believe that the election of competitive advantageDirectors is a means for Brunswick. Goodshareholders to influence corporate governance allows the skills, experiencepolicies and judgmentto hold management accountable for implementing those policies.

In determining whether to support declassification of the Board, the Board carefully considered the advantages and disadvantages of the current classified board structure and determined that it is advisable and in the best interests of the Company and our shareholders to support Brunswick’s executive management team, enabling management to improve Brunswick’s performance and maximize shareholder value.declassify the Board.


2018 PROXY STATEMENT | 26
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

GOVERNANCE POLICIES & PRACTICES

 

As set forth in the Principles, the Board’s responsibilities include overseeing and directing the Company’s management in building long-term value for shareholders. The Chief Executive Officer and the Company’s senior management team are responsible for managing Brunswick’s day-to-day business operations and for presenting regular updates to the Board about the Company’s business. The Board offers the Chief Executive Officer and management constructive advice and counsel and may, in its sole discretion and at the Company’s expense, obtain advice and counsel from independent legal, financial, accounting and other advisors.

The Board of Directors met five times during 2015. Our directors collectively attended 98 percent of the 2015 Board and committee meetings, with each director attending more than 85 percent of the aggregate of the Board meetings and meetings of committees of which he or she was a member during 2015. The Principles provide that all members of the Board are requested to attend Brunswick’s Annual Meeting of Shareholders. All members of the Board then in office attended the 2015 Annual Meeting of Shareholders.

The non-management directors regularly meet in executive session without members of management present. The Lead Independent Director, Manuel A. Fernandez, presides and acts as the Board’s leader when it meets in executive session or when the Chairman and Chief Executive Officer is unable to lead the Board’s deliberations. Additionally, the Lead Independent Director serves as a liaison between management and the Board and is responsible for consulting with the Chairman and Chief Executive Officer regarding Board and committee meeting agendas and Board governance matters.BRUNSWICK ETHICS PROGRAM

 

Brunswick Ethics Program

In 2013, Brunswickhas adopted theBrunswick Code of Conduct (the Code), which updated and replaced the prior code of ethics adopted in 2000. The Code applies to all employees, officers, directors, vendors, suppliers, and directors of the Company,agents, and includes standards and procedures for reporting and addressing potential conflicts of interest, as well as a general code of conduct that provides guidelines regarding how to conduct business in an ethical manner. The Board has adopted an additional Code of Ethics for Senior Financial Officers and Managers (the Financial Officer Code of Ethics). The Financial Officer Code of Ethics applies to Brunswick’s Chief Executive Officer, Chief Financial Officer, Vice President — President—Treasurer, Vice President — President—Tax, Vice President — President—Internal Audit, Vice President and Controller, and other designated Brunswick employees, designated by the Board, and sets forth standards to which these officers and employees are to adhere in areas such as conflicts of interest, disclosure of information, and compliance with laws, rules, and regulations. The Financial Officer Code of Ethics supplements the Code. The Nominating and Corporate Governance Committee, Audit Committee, and the Company’sour Ethics Office oversee and administer these policies. The Code and the Financial Officer Code of Ethics are available atwww.brunswick.com/company/ethics/codeofethics.php, and any Brunswick shareholder may obtain them in print upon request. If Brunswick grants a waiver of the policies set forth in the Code or the Financial Officer Code of Ethics, or materially amends either, we will, to the extent required by applicable law, regulation, or NYSE listing standard, disclose that waiver or amendment by making an appropriate statement on our website atwww.brunswick.com.

 

Director Nomination Process

The Nominating and Corporate Governance Committee is responsible for, among other things, identifying, screening, personally interviewing and recommending director nominee candidates to the Board. The Nominating and Corporate Governance Committee considers nominees on the bases of their integrity, experience, achievements, judgment, intelligence, personal character, ability to make independent analytical inquiries, willingness to devote adequate time to Board duties and the likelihood that they will be willing to serve on the Board for a sustained period. The Company does not have a formal policy with respect to diversity as a consideration in the identification of nominees for the Board of Directors. However, the Board and the Nominating and Corporate Governance Committee believe that it is important that the Board reflect different viewpoints and, therefore, as set forth in the Principles, additional consideration is given to achieving an overall diversity of perspectives, backgrounds and experiences in Board membership. The Nominating and Corporate Governance Committee may retain a third-party search firm to assist it with identifying qualified candidates that meet the needs of the Board at that time.

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The Nominating and Corporate Governance Committee will consider qualified director candidates who shareholders suggest by written submissions to Brunswick’s Secretary at Brunswick Corporation, 1 N. Field Court, Lake Forest, Illinois 60045; Attention: Corporate Secretary’s Office (fax: 847.735.4433; e-mailcorporate.secretary@brunswick.com). Any recommendation a shareholder submits must include the name of the candidate, a description of the candidate’s educational and professional background, contact information for the candidate and a brief explanation of why the shareholder believes the candidate is suitable for election. The Nominating and Corporate Governance Committee will apply the same standards in considering director candidates recommended by shareholders that it applies to other candidates.

In addition to recommending director candidates to the Nominating and Corporate Governance Committee, shareholders may also, pursuant to procedures established in the Company’s By-laws, directly nominate one or more director candidates to stand for election at an annual or special meeting of shareholders. For an annual meeting of shareholders, a shareholder wishing to make such a nomination must deliver written notice of the nomination to Brunswick’s Secretary not less than 90 days nor more than 120 days prior to the anniversary date of the immediately preceding annual meeting of shareholders. For a special meeting of shareholders, a shareholder wishing to make such a nomination must deliver written notice of the nomination to Brunswick’s Secretary not later than the close of business on the tenth day following the date on which notice of the meeting is first given to shareholders. In either case, a notice of nomination submitted by a shareholder must include information concerning the nominating shareholder and the shareholder’s nominee(s) as required by the Company’s By-laws.

Board Leadership Structure

Mr. Schwabero serves as our Chairman and Chief Executive Officer
Mr. Fernandez serves as our Lead Independent Director
9 of 10 directors are independent under the Board’s Principles and Practices and the NYSE Listed Company Manual
All of the members of the Audit, Finance, Human Resources and Compensation, Nominating and Corporate Governance and Qualified Legal Compliance Committees are independent
Our directors collectively attended 98 percent of the 2015 Board and committee meetings

The Board of Directors believes that having the Company’s Chief Executive Officer serve as Chairman of the Board is in the best interest of its shareholders at this time because this structure ensures a seamless flow of communication between management and the Board, in particular with respect to the Board’s oversight of the Company’s strategic direction, as well as the Board’s ability to ensure management’s focused execution of that strategy. Our strong Lead Independent Director position ensures that there are processes in place for robust and independent Board oversight.

The Board believes that the combined role of Chairman and Chief Executive Officer, together with the appointment of a Lead Independent Director by the other independent directors, a substantial majority of independent directors, and the use of regular executive sessions of non-management directors, achieves an appropriate balance between the effective development of key strategic and operational objectives and independent oversight of management’s execution of those objectives.

Additionally, the Board believes that because the Chairman and Chief Executive Officer is the director most familiar with the Company’s business, industry and day-to-day operations, he is well-positioned to help the Board focus on those issues of greatest importance to the Company and its shareholders and to assist the Board with identifying Brunswick’s strategic priorities, as well as the short-term and long-term risks and challenges facing the Company. While independent directors have invaluable experience and expertise from outside the Company and its businesses, giving them different perspectives regarding the development of the Company’s strategic goals and objectives, the Chief Executive Officer is well-suited to bring Company-specific experience and industry expertise to his discussions with non-management directors.

Shareholder Communications with the Board

The Principles provide that Brunswick shareholders or other interested parties may, at any time, communicate in writing with the Board, the Lead Independent Director or the non-management directors as a group, by writing to: Brunswick Corporation, 1 N. Field Court, Lake Forest, IL 60045; Attention: Corporate Secretary’s Office (fax: 847.735.4433; e-mailcorporate.secretary@brunswick.com). The General Counsel will review and distribute to the Board, the Lead Independent Director or the non-management directors as a group, as appropriate, copies of written communications received by any of these means, depending on the subject matter and facts and circumstances described in the communication. Communications that are not related to the duties and responsibilities of the Board, or are otherwise considered to be improper for submission to the intended recipient(s), will not be forwarded to the Board, the Lead Independent Director or the non-management directors.

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Review, Approval or Ratification of Transactions with Related PersonsTRANSACTIONS WITH RELATED PERSONS

 

Pursuant to its charter, the Nominating and Corporate Governance Committee of the Company’s Board of Directors is tasked with the recommendation and review of corporate governance principles, policies, and programs designed to ensure the Company’sour compliance with high ethical standards and with applicable legal and regulatory requirements, including those relating to conflicts of interest and other business practices that reflect upon the Company’sour role as a responsible corporate citizen. The Nominating and Corporate Governance Committee oversees the implementation of theBrunswick Code, of Conduct, which contains Brunswick’sour conflicts of interest policy. The Nominating and Corporate Governance Committee reports on these compliance matters to the Board of Directors, which is ultimately responsible for overseeing the Company’s ethical and legal compliance, including transactions with “related persons.”

 

The Company’sOur policy regarding related person transactions (the Related Person Transactions Policy) defines “related persons” to include all directorsDirectors and executive officersExecutive Officers of the Company, all beneficial owners of more than 5 percent of any class of voting securities of the Company, and the immediate family members of any such persons. On a regular basis, the Company requests that its directorswe request Directors and executive officersExecutive Officers to complete a questionnaire including questions designed to identify related persons and any potential related person transactions. The Corporation’sOur General Counsel and Controller, or their delegates, review and update a listing of those individuals identified as related persons and provide a copy of this listing to our external auditors on at least an annual basis and more often as warranted. According to the Related Person Transactions Policy, a related person transaction includes certain transactions in which the Company is a participant and in which

a related person has or will have a direct or indirect material interest, including any financial transaction, arrangement, or relationship, or any series of similar transactions, arrangements, or relationships. Certain transactions are excluded from thisthe Related Person Transactions Policy.

 

If a related person transaction required to be disclosed pursuant to SEC rules is identified, the Related Person Transactions Policy requires that the General Counsel and Controller review the transaction and advise the Chair of the Nominating and Corporate Governance Committee as well as the Chair of the Audit Committee, if appropriate. The Nominating and Corporate Governance Committee may approve or ratify such transaction or, if it determines that the transaction should be considered by the Board of Directors, submit it for consideration by all disinterested members of the Board (the Reviewing Directors). In determining whether to approve or ratify a related person transaction, the Nominating and Corporate Governance Committee and/or the Reviewing Directors will consider relevant factors, including:

 

The size of the transaction and the amount payable to a related person;
  
The nature of the interest of the related person in the transaction;
  
Whether the transaction may involve a conflict of interest; and
  
Whether the transaction involves the provision of goods or services to the Company that are also available from unaffiliated third parties and, if so, whether the terms of the transaction are at least as favorable to the Company as would be available in comparable transactions with unaffiliated third parties.

 

The Company’s Related Person Transactions Policy was formally codified in a written document in July 2010. Since January 1, 2015,2017, no transaction has been identified as a related person transaction and, therefore, no transaction was referred to the Board or any Board committee for review in that time period.

 

Risk ManagementRISK MANAGEMENT

 

The Board of Directors has an active role in overseeing effective management of the Company’sour risks and regularly reviews information regarding the Company’sour credit, liquidity, cash flow, and business operations, including any associated risks, such as cybersecurity and regulatory risks. The Board conducts an annual, in-depth review of the Company’sour business, which includes detailed analysis and consideration of strategic, operational, financial, legal, competitive, compliance, and compensation risk areas. Although the Board as a whole has responsibility for risk oversight, each Board Committee addresses relevant risk topics as part of its Committee responsibilities. The Committees oversee the Company’sour risk profile and exposures relating to matters within the scope of their authority and provide periodic reports to the full Board about their deliberations and recommendations. The Compensation Committee is responsible for overseeing the management of risks relating to the Company’sour executive compensation plans and its overall compensation philosophy.


2018 PROXY STATEMENT | 27
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

 

Historically, in an ongoing effort to manage risk, Brunswick haswe have maintained a level of financial prudence associated with itsour compensation programs which it planswe plan to continue. In assessing whether risks arising from Brunswick’sour compensation programs or policies were reasonably likely to have a material adverse effect on the Company, senior management reviewed the Company’sour compensation programs and practices for all employees, the potential risk exposure presented by those programs and practices, and the factors, tools, and processes that mitigate those risks. As part of its 20152017 review, management considered the compensation arrangements currently in place for employees and officers and, following this review, management determined, and the Compensation Committee agreed, that none of Brunswick’sour compensation programs or policies creates risks that are reasonably likely to have a material adverse effect on the Company.

 

As part of this review, management presented a summary to the Company’s Compensation Committee for discussion. The summary listed each compensation program and policy applicable to the various groups of Brunswick employees and officers, the potential risks presented by that program or policy, and the risk mitigation tools or processes employed by the Company to mitigate the related risks.

 

The compensation programs and policies covered by the summary included payments in the forms of base salaries, annual incentive compensation, and equity-based awards. The risk mitigation tools covered by the summary included the following: (1) the plans were capped at maximum payout levels that, while creating incentives for superior business performance, were not so great as to entice undue risk-taking; (2) the performance metrics to achieve above-target payouts under the plans were not unduly leveraged (that is, small increments of above-target performance would not result in disproportionate increases in calculated plan bonus amounts); and (3) the plans contain negative discretion provisions that can be (and have been) exercised to reduce or eliminate calculated payout results. This mechanism places final control of plan payouts with the Company’sour Board of Directors. Other compensation risk mitigants in place include robust stock ownership requirements for Executives, an established clawback policy, and no hedging or pledging of shares by employees.

 

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In addition to senior management’s review, members of Brunswick’sour Human Resources Department conduct an annual assessment of all executive and non-executive incentive plans to ensure that they are aligned with the Company’sour strategic business objectives. In 2015, in addition to its standard review process, Brunswick’s2017, our Human Resources representatives conducted a full review of the potential risks associated with the Company’sour incentive plans and engaged in the following analysis:

 

IdentifyIdentified the metrics governing each incentive-based compensation program;
  
AssessAssessed the performance metrics of the incentive programs to ensure that they are consistent with the Company’sour short-term and long-term goals;
  
ReviewReviewed the potential range of payouts pursuant to the plans to confirm that payouts are reasonable in relation to the economic gain associated with achievement of the metrics;
EnsureEnsured that the plans establish maximum payout amounts, or caps, for the calculation of payments, as appropriate; and
  
VerifyVerified that the Company’sour management team and/or the Board of Directors retain the right to modify, suspend, and/or terminate the plans and corresponding payouts without prior notice.

 

An area of focus for 2017 was sales incentive programs and design. After review, management concluded that our sales incentive plans do not pose a material risk to the Company and appropriate risk mitigating factors are in place.

The Human Resources representatives considered all of the foregoing information, specifically assessing each of the Company’sour incentive plans to identify any provisions that might cause employees to act in a manner that would create risks that are reasonably likely to have a material adverse effect on the Company. No such provisions were identified.

 

In addition, the Compensation Committee engages in a comprehensive annual review of the Brunswick Performance Plan (BPP), the Company’sour primary annual incentive plan, and its performance measures. The Compensation Committee assesses the BPP in conjunction with the Company’sour overall strategic business objectives, as well as its forecast and budget. In 2015,2017, the Committee also assessed each of the Company’sour compensation programs, ensuring that they were consistent with and aligned with Brunswick’sour short- and long-term business objectives. The Compensation Committee reviewed the 20152017 BPP and determined that its plan design would effectively encourage employees to engage in appropriate and responsible behavior without unnecessary risk-taking that could have a negative impact on the Company. In addition, the BPP contains a negative discretion clause that expressly empowers the Compensation Committee to limit or reduce the BPP payout under the BPP’s formula, based on extenuating circumstances and business outlook.

 

The majority of Brunswick’sour non-executive incentive plans adopt the BPP’s performance metrics, ensuring that the plans encourage and reward appropriate behavior throughout the organization. For those few incentive plans at the division level that do not mirror the BPP, Brunswick management performs a similar analysis of the plans on an annual basis in order to identify and remediate any potential negative behaviors that might result.


 

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2018 PROXY STATEMENT | 28
 
Back to Contents
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

Stock Held by Directors, Executive Officers and Principal Shareholders

DIRECTOR COMPENSATION

 

2017 DIRECTOR COMPENSATION TABLE

The table below summarizes the compensation we paid to non-employee Directors for the fiscal year ended December 31, 2017.

Director(1) Fees Earned or
Paid in Cash(2)
 Stock Awards(3) All Other
Compensation(4)
Total
NOLAN D. ARCHIBALD  $90,000  $135,000  $30,000 $255,000
NANCY E. COOPER  $90,000  $145,034   $235,034
DAVID C. EVERITT  $90,000  $137,504  $30,000 $257,504
MANUEL A. FERNANDEZ  $89,943  $210,440  $30,000 $330,383
DAVID V. SINGER  $89,943  $157,970  $29,271 $277,184
RALPH C. STAYER  $89,943  $157,970  $13,987 $261,900
JANE L. WARNER  $89,943  $152,953  $30,000 $272,896
J. STEVEN WHISLER  $89,936  $158,497  $30,000 $278,433
ROGER J. WOOD  $89,943  $157,970  $30,000 $277,913

(1)Mark D. Schwabero, our Chairman and CEO, is not included in this table as he is an employee of the Company and receives no additional compensation for his service as a Director. The compensation Mr. Schwabero received as a Company employee is shown in the Summary Compensation Table.
(2)Amounts in this column reflect the 2017 annual cash fees earned by each non-employee Director. Mr. Fernandez, Mr. Singer, Mr. Stayer, Ms. Warner, Mr. Whisler, and Mr. Wood elected to receive the 2017 annual cash fees in the form of deferred Common Stock, with a 20 percent premium, which reflects variation from cash fees related to number of shares deferred.
(3)This column represents the dollar amount recognized for financial statement reporting purposes with respect to the 2017 fiscal year in accordance with FASB ASC Topic 718. Amounts in this column represent the portion of fees required to be paid to Directors in the form of Common Stock, as well as the 20 percent premium that is received by those Directors who elected to receive the cash portion of their fees in the form of deferred Common Stock. For assumptions used in the valuation of such awards, see Note 18 to the financial statements included in the Company’sAnnual Report on Form 10-K for the fiscal year ended December 31, 2017.
(4)The amounts shown in this column include our cost of products provided during our fiscal year ended December 31, 2017.

The grant date fair value of awards in this column is as follows:

Director Grant Date Fair Values of
Shares of
Common Stock
 Grant Date Fair Values of Shares
Attributable to 20% Premium
Applied to Deferral of Fees
NOLAN D. ARCHIBALD  $135,000  
NANCY E. COOPER  $145,034  
DAVID C. EVERITT  $137,504  
MANUEL A. FERNANDEZ  $192,487  $17,953
DAVID V. SINGER  $140,017  $17,953
RALPH C. STAYER  $140,017  $17,953
JANE L. WARNER  $135,000  $17,953
J. STEVEN WHISLER  $145,034  $13,463
ROGER J. WOOD  $145,017  $17,953

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Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

The following table sets forth the aggregate number of outstanding stock awards held by each non-employee Director as of December 31, 2017:

DirectorAggregate Number of Stock
Awards Outstanding at
December 31, 2017
NOLAN D. ARCHIBALD4,476
NANCY E. COOPER
DAVID C. EVERITT
MANUEL A. FERNANDEZ4,476
DAVID V. SINGER
RALPH C. STAYER4,476
JANE L. WARNER
J. STEVEN WHISLER1,634
ROGER J. WOOD

NARRATIVE TO DIRECTOR COMPENSATION TABLE

ANNUAL FEES AND DEFERRED STOCK AWARDS

Non-employee Directors are entitled to an annual retainer of $215,000, with $90,000 payable in cash and $125,000 payable in Common Stock. The Lead Independent Director, chairs of committees, and members of certain committees receive additional annual retainers paid in Brunswick stock, as follows:

Lead Director: $50,000
Audit Committee Chair: $20,000
Compensation Committee Chair: $15,000
Finance and Governance Committee Chairs: $10,000
Audit Committee members: $10,000
Compensation Committee members: $7,500
Finance and Governance Committee members: $5,000

For the portion of each Director’s total annual fee paid in Common Stock, the number of shares is determined by the closing price of Common Stock on the date of the award and is reported in the “Stock Awards” column of the Director Compensation Table. The receipt of these shares may be deferred until a Director retires from the Board. Each directorDirector may elect to have the cash portion of the annual fee paid as follows:

In cash;
In Common Stock distributed currently; or
In deferred Common Stock with a 20 percent premium.

For Directors who elect to receive the cash portion in deferred Common Stock, the number of shares to be received upon retirement is determined by multiplying the cash amount by 1.2, then dividing that amount by the closing price of Common Stock on the date of the award.

SHARE OWNERSHIP GUIDELINES

As set forth in the Principles, within five years after the date on which a Director first became a Director, and nomineethereafter for director,so long as each executive officerDirector is a Director of the Company, each Director is required to own Common Stock and deferred stock units of the Company equal to five times the amount of the Director’s annual cash retainer. Once having met this threshold, if a Director falls below the threshold as a result of a decline in our stock price, the Director shall have a two-year period within which to once again achieve the threshold. We calculate compliance with these guidelines annually, using the average Brunswick stock price for the prior calendar year. As of December 31, 2017, all Directors were in compliance with the share ownership requirements.

BRUNSWICK PRODUCT PROGRAM

Directors are encouraged to use Brunswick products to enhance their understanding and appreciation of Brunswick’s business. Directors receive an annual allowance of up to $30,000 which may be applied to purchase Brunswick products at discounted rates and/or fund expenses incurred with regard to the ownership of such products. The value of the products is included in the Directors’ taxable income. Directors may also purchase additional Brunswick products at their own expense, at discounted rates.


2018 PROXY STATEMENT | 30
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

STOCK HELD BY DIRECTORS, EXECUTIVE OFFICERS, AND PRINCIPAL SHAREHOLDERS

Each Director, each Executive Officer listed in the 2017 Summary Compensation Table, and all directorsDirectors and executive officersExecutive Officers as a group owned the number of shares of Brunswick Common Stock set forth in the following table, with sole voting and investment power except as otherwise noted:

 

Name of Individual
or Persons in Group
 Number of Shares Beneficially
Owned as of March 4, 2016
   Percent
of Class
 
Nolan D. Archibald  79,356(1)  * 
Nancy E. Cooper  5,936   * 
David C. Everitt  9,159(1)  * 
Manuel A. Fernandez  83,814(1)  * 
David V. Singer  10,984(1)  * 
Ralph C. Stayer  40,733(1)  * 
Jane L. Warner  4,586(1)  * 
J. Steven Whisler  46,134(1)  * 
Roger J. Wood  19,050(1)  * 
Dustan E. McCoy(3)  1,155,854(2)(6)  1.3%
Mark D. Schwabero(4)  233,659(2)(6)  * 
William L. Metzger  229,231(2)(6)  * 
John C. Pfeifer  80,829(2)  * 
B. Russell Lockridge(5)  0(6)  * 
All directors and executive officers as a group  2,260,184(2)  2.5%
Director/Executive OfficerNumber of Shares
Beneficially
Owned as of March
5, 2018
Percent
of Class
NOLAN D. ARCHIBALD86,312(1)*
NANCY E. COOPER9,517*
DAVID C. EVERITT14,607(1)*
MANUEL A. FERNANDEZ97,413(1)*
DAVID V. SINGER12,988(1)*
RALPH C. STAYER46,636(1)*
JANE L. WARNER13,970(1)*
J. STEVEN WHISLER54,584(1)*
ROGER J. WOOD29,018(1)*
MARK D. SCHWABERO225,285(2)(3)*
WILLIAM L. METZGER194,741(2)(3)*
JOHN C. PFEIFER57,217(2)*
HUW S. BOWER2,657(2)*
JAIME A. IRICK(4)
ALL DIRECTORS &
EXECUTIVES AS A GROUP
874,675(2)1%

*Less than 1 percent

(1)Includes the following shares of Brunswick Common Stock issuable to non-employee directors,Directors, receipt of which has been deferred until the date of the director’s retirement from the Board: Mr. Archibald 79,35675,857 shares, Mr. Everitt 9,15914,607 shares, Mr. Fernandez 83,81497,413 shares, Mr. Singer 5,1801,889 shares, Mr. Stayer 16,83318,260 shares, Ms. Warner 4,46513,849 shares, Mr. Whisler 39,06647,516 shares, and Mr. Wood 18,98528,953 shares.
Excludes 67,3327,558 shares of Brunswick Common Stock issuable to Mr. Singer and 73,038 shares issuable to Mr. Stayer, receipt of which has been deferred. Mr.Messrs. Singer and Stayer will be entitled to receive these deferred shares in predetermined installments, which will commence at varying times in accordance with histheir election following histheir retirement from the Board of Directors.
(2)Includes the following shares of Brunswick Common Stock issuable pursuant to stock-settled SARs exercisable within 60 days of February 11, 2016: Mr. McCoy 917,800 shares.
Includes the following shares of Brunswick Common Stock issuable pursuant to stock-settled SARs exercisable within 60 days of March 4, 2016:5, 2018: Mr. Schwabero 203,300164,852 shares, Mr. Metzger 157,92594,300 shares, Mr. Pfeifer 74,20035,950 shares, and all executive officers as a group 1,527,925304,289 shares.
Includes the following shares of Brunswick Common Stock held by the Brunswick Savings Plan as of December 31, 2015:2017: Mr. McCoy 102Metzger 1,137 shares, Mr. Metzger 1,101Bower 31 shares, and all executive officers as a group 4,9042,185 shares.
Excludes the following shares of Brunswick Common Stock issuable to officers, receipt of which has been deferred: Mr. McCoy 289,351 shares,Schwabero 74,381 shares. Mr. Schwabero 31,894 shares and all executive officers as a group 323,696 shares. These officers will be entitled to receive these deferred shares in predetermined installments which will commence at varying times, in accordance with plan terms.terms, none within 60 days of the Record Date.
(3)Mr. McCoy retired as Chairman and Chief Executive Officer effective February 11, 2016. This table therefore reflects the number of shares beneficially owned by Mr. McCoy as of February 11, 2016.
(4)The Board appointed Mr. Schwabero as Chairman and Chief Executive Officer effective February 11, 2016.
(5)Mr. Lockridge has provided notice of his intent to retire effective March 31, 2016.
(6)Excludes Restricted Stock Units (RSUs) owned and vested under the Rule of 70 or Age 62 but not distributable for three years from the grant date.

BRUNSWICK CORPORATION -2016 Proxy Statement22

 
(4)Mr. Irick was hired on January 19, 2017. His RSUs and Performance Shares are not reflected in this table, as they have not yet vested.

Those shareholders known to Brunswickus to beneficially own more than 5 percent of Brunswick’sour outstanding Common Stock are:

 

Name and Address of Beneficial Owner Number of Shares Beneficially
Owned as of December 31, 2015
   Percent
of Class
 
BlackRock, Inc.
55 East 52nd Street

New York, NY 10055
  6,721,792(1)   7.40%
The Vanguard Group, Inc.
100 Vanguard Blvd.
Malvern, PA 19355
  6,101,151(3)   6.70%
FMR LLC and certain of its affiliates
245 Summer Street
Boston, MA 02210
  5,836,962(2)   6.41%
Name and Address of
Beneficial Owner
Number of Shares
Beneficially
Owned
Percent
of Class
BLACKROCK, INC.
55 East 52nd Street, New York, NY 10055
7,354,077(1)8.40%
THE VANGUARD GROUP, INC.
100 Vanguard Blvd., Malvern, PA 19355
7,085,418(2)8.08%

(1)This information is based solely upon a Schedule 13G/A filed by BlackRock, Inc. (BlackRock) with the SEC on January 25, 2016.29, 2018. BlackRock has sole voting power over 6,372,0097,018,831 shares and sole dispositive power over 6,721,7927,354,077 shares as of December 31, 2015.2017.
(2)This information is based solely upon a Schedule 13G/A filed by The Vanguard Group, Inc. (Vanguard) with the SEC on February 10, 2016.8, 2018. Vanguard has sole voting power over 67,41248,319 shares, shared voting power over 11,236 shares, sole dispositive power over 6,034,1397,032,718 shares, and shared dispositive power over 67,01252,700 shares as of December 31, 2015.2017.
(3)This information is based solely upon a Schedule 13G/A filed by FMR LLC (FMR) with the SEC on February 12, 2016. The FMR reporting entities include FMR, which is the beneficial owner of 5,836,962 shares or 6.41% of the Common Stock outstanding at December 31, 2015 and Abigail P. Johnson. FMR has sole voting power over 931,762 shares and sole dispositive power over 5,836,962 shares as of December 31, 2015.

 

Section 16(a) Beneficial Ownership Reporting ComplianceSECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

 

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires Brunswick’s directors, executive officersour Directors, Executive Officers, and beneficial owners of more than 10 percent of Brunswick Common Stock to file initial reports of ownership and reports of changes in ownership with the SEC. Based on a review of the copies of such forms furnished to the Company and written representations from the Company’s directorsDirectors and executive officers,Executive Officers, the Company believes that all forms were filed in a timely manner during 2015.2017 with the exception of the Form 4 filed by Mr. Jaime Irick on January 25, 2017, reporting securities acquired on January 19, 2017. The Form 4 was filed late due to the unavailability of timely SEC EDGAR codes for Mr. Irick, who was a new Brunswick Executive Officer at the time.


 

BRUNSWICK CORPORATION -2016 Proxy Statement23

2018 PROXY STATEMENT 31
 
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

EXECUTIVE COMPENSATION

 

Compensation Discussion and AnalysisCOMPENSATION DISCUSSION AND ANALYSIS

 

This Compensation Discussion and Analysis describes Brunswick’sour overall executive compensation policies and practices and specifically analyzes the total compensation for the named executive officersNamed Executive Officers (NEOs). The NEOs are:

 

Dustan E. McCoy – Former
MARK D. SCHWABEROWILLIAM L. METZGERJAIME A. IRICKJOHN C. PFEIFERHUW S. BOWER
Chairman andSenior Vice PresidentVice PresidentVice PresidentVice President
& Chief Executive Officer1
Mark D. Schwabero – Chairman and Chief Executive Officer1
William L. Metzger – Senior Vice President and& Chief Financial Officer
& President
& PresidentJohn C. Pfeifer – Vice& President and President – Mercury Marine
B. Russell Lockridge – Vice President and Chief Human Resources Officer2

1Mr. McCoy retired as Chairman and Chief Executive Officer and Mr. Schwabero was appointed Chairman and Chief Executive Officer, both effective February 11, 2016. Mr. Schwabero previously served as President and Chief Operating Officer. See the Current report on Form 8-K filed with the SEC on February 12, 2016 for additional information.
2Mr. Lockridge has provided notice of his intent to retire effective March 31, 2016.

 

Business HighlightsBUSINESS HIGHLIGHTS

 

Our 20152017 results represent the sixth consecutivereflected another successful year of solid earnings and strong improvements in operating performance. The Companyfree cash flow. We sought to achieve the following financial objectives in 2015:2017:

 

Deliver revenue growth;
Experience increases in earnings before income taxes, as well as a slight improvement in gross margin percentages; and
Continue to generate strong free cash flow and execute against the Company’s capital strategy.

 

Achievements against the Company’sour financial objectives in 20152017 were as follows:

Deliver revenue growth:

 

Ended the year with a 7 percent increase in net sales when compared with 2014 due to the following:
 REVENUE GROWTH

Ended the year with a 9 percent increase in net sales when compared with 2016 on a GAAP basis and 8 percent on a constant currency basis, due to the following:

 -Favorable demand environment continuedStrong growth in all three primary boat categories and the outboard boatengine business, along with solid growth in the marine parts and engine markets with increases driven by favorable retail demand trends and successful new product introductions;accessories businesses;
   
 -Increased salesThe Marine Engine and Boat segments benefited from strong global market demand, as domestic markets continued to grow and international markets benefited from gains in the marine service, partsEurope, Canada, and accessories businesses reflecting benefits from acquisitions, market growth, successful new product launches and market share gains;Asia-Pacific, as well as improving conditions in other regions;
   
 -Higher average selling prices inAdditionally, the Boat and Marine Engine segments due to a favorable shift in mix;and Boat segments’ sales were aided by successful product launches, continued strong market share, and execution of our acquisition strategy;
   
 -Fitness segment benefited from highernet sales to U.S. health clubs, local and federal governments and hospitality customers as well as anreflected growth in international markets, including the impacts of the Indoor Cycling Group acquisition completed in 2015, partially offset by a slight decline in international markets; and2016, while domestic market demand was flat;
   
 -InternationalOur international sales for the Company decreased 4increased 10 percent in 20152017 when compared with 20142016 on both a GAAP basis. Onbasis and on a constant currency basis international net sales increased 7 percent, primarily due to increased sales in Europeanacross all international markets, especially Asia-Pacific, Europe, and Asia-Pacific markets; partially offset by continuing unfavorable global retail demand trends in certain marine markets, including Canada and Brazil.Canada.

 

2018 PROXY STATEMENT 32
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

BUSINESS HIGHLIGHTS

EARNINGS BEFORE INCOME TAX

Experience increasesan increase in earnings before income taxes, as well as a slight improvementdeliver improvements in both gross margin and operating margin percentages:

 

-Reported earnings before income taxes of $315.2$343.3 million in 20152017 compared with earnings before income taxes of $287.9$389.0 million in 2014;2016; adjusted earnings before income taxes were $490.0 million in 2017 versus $459.3 million in 2016(1);
  
Improved gross margins by 10-Gross margin declined 100 basis points when compared with 2014,2016, driven mainly by benefits from cost reductions including benefits relateddeclines in the Fitness segment due to lower commodityhigher costs, particularly product field campaigns costs for certain Cybex products designed prior to the acquisition as well as freight costs in the fourth quarter, challenging pricing dynamics in certain international markets, and sourcing initiatives and volume leverage, offset by the unfavorable effects of foreign exchange rates; andchanges in sales mix; gross margin, as adjusted, declined 80 basis points when compared with 2016(1);
  
Increased-Operating margin declined by 190 basis points when compared with the prior year, due in part to increased pension settlement charges;charges, restructuring, exit, integration, and impairment charges;charges, field campaigns charges in the Fitness segment, and increased investment spendingthe impact of planned investments in 2015growth initiatives compared with 2014, partially offset by the absence of an impairment of an equity method investment recorded in 2014.prior year; operating margin, as adjusted, declined 40 basis points versus 2016(1).

 

FREE CASH FLOW

Continue to generate strong free cash flow and execute against the Company’s capital strategy:

 

-Generated strong free cash flow of $243.1 million in 2017(1), enabling the Company to continue executing its capital strategy as follows:

Funded Investments in Growth:

Funded investments in growth:
 -Organically through capital expenditures, which included tooling costs for the production ofinvestments in new products and spending for plantas well as capacity expansions growth initiatives and profit-maintaining investments; and research and development;across all segments;
   
 -Through acquisition opportunities such asacquisitions, including the $29.7$15.5 million invested in marine parts and accessories and Fitnessthe Marine Engine segment acquisitions during 2015;2017;
   
 -Contributed $73.6$73.7 million to the Company’s qualified and non-qualified defined benefit pension plans, which included an amount made in connection with settlement payments made to certain pension plan participants in 2015;plans; and
   
 -Enhanced shareholder returns in 2017 by repurchasing $120.0$130.0 million of common stock under the Company’sour share repurchase program in 2015 and increased cash dividends paid to shareholders in 2015 to $48.3 million from $41.7 million in 2014.$60.6 million.

 -Ended the year with $459.0 million of cash and marketable securities.
Ended the year with $668.8 million of cash and marketable securities, a net increase of $32.9 million.

 

BRUNSWICK CORPORATION -2016 Proxy Statement(1) Please see Appendix 2 for a reconciliation of non-GAAP measures.24

2018 PROXY STATEMENT | 33
 

Deliver Strong Return to Shareholders

Brunswick’s compensation plans are intended to support its strategic focus and reward Company performance. Brunswick’s compensation philosophy is to encourage and reward the creation of sustainable, long-term shareholder value. From a shareholder perspective, Brunswick performed well as illustrated by the total shareholder return (TSR) of 77.3 percent for the three years ended December 31, 2015. The table below highlights Brunswick’s stock price history over a five year period:

STOCK PRICE HISTORY

*Proxy SummaryClosing stock price as reported on the New York Stock Exchange for each year.OverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

 

Consideration of 2015 Executive Compensation VoteCONSIDERATION OF 2017 EXECUTIVE COMPENSATION VOTE

 

At its 2015 shareholder meeting, the Company received overwhelming shareholder approval of its2017 Annual Meeting, shareholders overwhelmingly approved our “say on pay” proposal (97.13(shareholders cast 93.75 percent of votes cast were cast for the proposal). The Company wasWe were pleased with this significant vote of confidence in itsour pay practices and did not make any direct changes to itsour compensation programs as a result of the vote. Nevertheless, the Companywe did make some changes to itsour compensation programs in 20152017 to further reinforce the Company’sour pay-for-performance philosophy and align management compensation with shareholder interests.

 

Key Compensation Decisions in 2015KEY COMPENSATION DECISIONS IN 2017

 

Annual Incentive Plan

ANNUAL
INCENTIVE PLAN

For 2017, Earnings Before Interest and Taxes (EBIT) was used as the funding metric under the Brunswick Corporation Senior Management Incentive Plan (SMIP), the Company’s Section 162(m) performance qualified annual incentive plan. Specifically, the SMIP pool was funded based on 2% of EBIT for the CEO and 1% of EBIT for each of the other NEOs. For purposes of distributing the funding earned under the SMIP, the Brunswick Performance Plan (BPP) is used. For 2017, we designed the BPP to include divisional EBIT to reward division performance, while maintaining a portion of the award tied to overall Brunswick Earnings Per Share (EPS). Specifically, the 2017 BPP for the NEOs contained performance measures attributable to each of the divisions in addition to corporate EPS. Actual performance in 2017 was below the performance targets set for the 2017 BPP, and we paid NEOs aggregate awards under the plan at approximately 66 percent of target opportunity. For additional information on the annual incentive plan, see “Achievement of Targeted Results” on page 37 below.

LONG-TERM
INCENTIVES

We grant performance-based equity in the form of Performance Shares to certain key senior executives, including each of the NEOs. Starting with the awards granted in 2015, performance underlying the awards is measured based on Cash Flow Return on Investment (CFROI) and Operating Margin and Brunswick’s total shareholder return performance relative to the TSR of an established peer group, as measured over a three-year performance period. We believe Performance Shares strengthen our pay-for-performance philosophy and align management’s long-term goals with our key strategic initiatives. Actual performance for the 2015 Performance Shares award exceeded the three-year targets and awards paid under the plan were at 136 percent of target opportunity. For additional information, see page 38. In addition, the Company continues to provide Restricted Stock Units (RSUs) as part of equity compensation delivered to reiterate key retention initiatives and align to shareholder interests.

NEW HIRE ONE-TIME COMPENSATION
PAYMENTS FOR MR. IRICK

In January 2017, Mr. Irick was hired as the Vice President and President of the Fitness Division. In consideration of this new hire offer, we provided Mr. Irick the following one-time compensation payments in addition to his annual compensation package: a sign-on RSU grant and cash bonus. The RSU grant represents the value of equity forfeited from a previous employer and one component of the cash sign-on bonus represents the annual incentive foregone by the previous employer. In addition, he received the first installment of a two-installment cash sign-on bonus upon his date of hire; he received the second installment on the first anniversary of his date of employment in January 2018. Future awards to Mr. Irick will coincide with the regular compensation award schedule, similar to the rest of the NEOs.

 

For 2015, Earnings Before Interest and Taxes (EBIT) was used as the funding metric under the Brunswick Corporation Senior Management Incentive Plan (SMIP), the Company’s Section 162(m) performance qualified annual incentive plan. Specifically, the SMIP pool was funded based on 2% of EBIT for the CEO and 1% of EBIT for each of the other NEOs. For purposes of distributing the funding earned under the SMIP, the Brunswick Performance Plan (BPP) is used. For 2015, the Company designed the BPP to include divisional EBIT to reward division performance, while still keeping a portion of the award tied to overall Brunswick Earnings Per Share (EPS). Specifically, the 2015 BPP for the NEOs contained performance measures attributable to each of the divisions in addition to corporate EPS. Actual performance in 2015 exceeded the performance targets set for the 2015 BPP, and the Company paid aggregate awards under the plan at approximately 105 percent of target opportunity. For additional information on the annual incentive plan, see “Achievement of Targeted Results” on page 29 below.

Long-Term Incentives

In 2015, the Company granted performance-based equity in the form of performance shares (Performance Shares) to certain key senior executives, including each of the NEOs. Starting with the awards granted in 2015 performance underlying the awards is measured over a three-year performance period. These were the first awards granted under the Brunswick Corporation 2014 Stock Incentive Plan, which was approved by shareholders at the Company’s 2014 Annual Meeting. The Company believes Performance Shares strengthen its pay-for-performance philosophy and align management’s long-term goals with the Company’s key strategic initiatives.

Additionally, the Company has introduced double-trigger Change in Control equity vesting provision for 2016 equity grants. The Company believes that this modification aligns with competitive best practice and shareholder interests.

BRUNSWICK CORPORATION -2016 Proxy Statement25

Pension Plan De-risking

In 2015, the Company executed several strategies to de-risk its frozen defined benefit qualified pension plans, notably the payment of lump sum amounts to certain active participants in connection with a plan termination, including Mr. Metzger, of their entire accrued benefit under the plan. The Company reduced plan liabilities by approximately $200 million as a result of these lump sum payments and other actions taken in 2014 to pay terminated vested participants their full benefit.

Overall Philosophy and Objectives of Our Executive Compensation ProgramsOVERALL PHILOSOPHY AND OBJECTIVES OF OUR EXECUTIVE COMPENSATION PROGRAMS

 

The overall philosophy of Brunswick’sour compensation programs for itsthe NEOs and other senior executives is to encourage and reward the creation of sustainable, long-term shareholder value. Specifically, the Company haswe have identified the following objectives to help realize this goal:

 

 Alignment with Shareholders’ Interests -    
ALIGNMENT WITH
SHAREHOLDERS’
INTERESTS
MOTIVATE ACHIEVEMENT
OF FINANCIAL AND
STRATEGIC GOALS
REMAIN
COMPETITIVE
REWARD SUPERIOR
PERFORMANCE
Reward performance in a
given year and achievements
over a sustained period that
are aligned with the interests
of our shareholders;
shareholders.
Motivate Achievement of Financial and Strategic Goals - Ensure that compensation
structure reinforces
achievement of business
objectives and execution of Brunswick’s
our overall strategy;
strategy.
Remain Competitive - Attract, retain, and motivate
the talent required to ensure Brunswick’s
our continued success; and
success.
Reward Superior Performance - Reinforce Brunswick’s pay-for-performanceour pay-for-
performance culture.

 

Compensation Design Principles

2018 PROXY STATEMENT 34
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
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Director
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Executive
Compensation
Proposal 3Equity
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Plan
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Matters
Proposal 42019
Shareholder
Submissions
Appendices

COMPENSATION DESIGN PRINCIPLES

 

In support of theour executive compensation programs’ objectives, identified above, the framework of Brunswick’sour executive compensation programs incorporates the following compensation design principles:principles.

FOCUS ON THE CREATION OF LONG-TERM SHAREHOLDER VALUE

 

Focus on the Creation of Long-Term Shareholder Value

Brunswick’sOur senior executives are responsible for achieving long-term strategic goals. Accordingly, compensation is weighted towards rewarding long-term value creation for shareholders. For Mr. McCoySchwabero in 2015,2017, approximately 6568 percent of targeted total compensation was based on long-term performance, and for our other NEOs, it was approximately 5250 percent. For Mr. McCoy,Schwabero, approximately 2118 percent of targeted total compensation was based on annual performance against established performance criteria, and for our other NEOs it was approximately 23 percent. The balance consisted of base salary (14 percent for Mr. McCoySchwabero and 2527 percent for the other NEOs in 2015)2017).

 

Our emphasis on long-term shareholder value creation is best illustrated in the following chart, which shows the portion of total targeted compensation that is attributable to our long-term incentive compensation and the portion attributable to other key elements of our compensation programs. As shown in the chart, long-term incentive compensation accounts for the largest percentage of overall compensation when compared to base salary and annual incentives (bonus). In addition, as a result of the compensation structure, a majority of senior executive compensation is deemed performance-based or “at risk,” with such amounts constituting approximately 86 percent of Mr. McCoy’sSchwabero’s total compensation and approximately 7573 percent of total compensation for our other NEOs in 2015.2017.

 

Below is a chart comparing the targeted compensation mix of our formerthe CEO and other NEOs:

 

 

BRUNSWICK CORPORATION -2016 Proxy Statement26

WHAT WE DOWHAT WE DON’T DO
We tie a very high percentage of executive pay to performanceWe have no tax gross-ups (including perks, excise tax)
We require executives to achieve performance-based goals tied to shareholder returnWe have no modified single-trigger or single-trigger CIC severance agreements (we only use double-trigger CIC severance provisions)
We target median compensation levels and review market data of our peer group when making executive compensation decisionsWe expressly forbid option repricing without shareholder approval in all of our equity plans
We apply strict share ownership guidelines to NEOs and directorsAll of our active equity plans expressly forbid exchanges of underwater options for cash
We disclose complete information on annual incentive plansWe do not allow hedging of shares by directors or employees
We require vested shares from our equity compensation programs to be held until share ownership guidelines are metWe do not allow pledging of shares by directors or employees
We consider, and attempt to mitigate, risk in our compensation programWe do not pay dividends or dividend equivalents on unearned performance shares
We use an independent compensation consultant
We have an established clawback policy
Starting in 2016, we implemented double-trigger equity award vesting acceleration upon a Change in Control (CIC)

Provide Incentives for Achievement of the Company’s GoalsPROVIDE INCENTIVES FOR ACHIEVEMENT OF OUR GOALS

 

In addition to achieving Brunswick’sour long-term and strategic goals, the Company’swe charge our senior executives are charged with the responsibility for meeting the Company’sour strategic, financial and operational goals. As a result, the Company haswe have linked executive compensation to business performance by establishing measurable business metrics against which we measure performance, is measured, and which the Board of Directors has determined are important to Brunswick’sour key stakeholders.

 

The Company establishesWe establish variable compensation targets (including individual BPP targets) for NEOs and other employees with reference to peermarket median total direct compensation (base salary plus annual bonus plus long-term incentive) minus base salary. This amount is then split between annual and long-term incentives at a ratio that the Compensation Committee feels is appropriate for a company like Brunswick.

 

AnnualWe base annual incentive metrics are based on a combination of division and overall Brunswick results. Long-term incentives are based on Brunswick’sour consolidated results and total shareholder return.

WHAT WE DO:

 

BRUNSWICK CORPORATION -2016 Proxy Statement27Base a very high percentage of executive pay on performance

Require executives to achieve performance-based goals tied to shareholder return

Target median compensation levels and review market data of our peer group when making executive compensation decisions

Apply strict share ownership guidelines to NEOs and Directors

Require vested shares from our equity compensation programs to be held until share ownership guidelines are met

Disclose complete information on annual incentive plans

Evaluate, and manage, risk in our compensation programs

Use an independent compensation consultant

Have an established clawback policy

Maintain double-trigger equity award vesting acceleration upon involuntary termination following a Change in Control (CIC)

Engage in a rigorous and thoughtful executive succession planning process with the Board

WHAT WE DON’T DO:

No tax gross-ups (including perquisites, excise tax)

No modified single-trigger or single-trigger CIC severance agreements (we only use double-trigger CIC severance provisions)

Expressly forbid option repricing not in accordance with plans already approved by shareholders

Expressly forbid exchanges of underwater options for cash in all of our active equity plans

No hedging of shares by our Directors or employees

No pledging of shares by our Directors or employees

No dividends or dividend equivalents on unearned Performance Shares


2018 PROXY STATEMENT | 35
 

Competitive Compensation

Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
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Proposal 42019
Shareholder
Submissions
Appendices

 

Brunswick recognizesCOMPETITIVE COMPENSATION

We recognize that, in order to attract and retain the level of talent that is essential to achieving itsour established objectives, itwe must maintain a competitive executive compensation program.

 

Each year, Frederic W. Cook & Co., Inc., the Compensation Committee’s independent compensation consultant, FW Cook, provides a detailed analysis, utilizing a peer group of 1617 publicly-traded companies with annual revenue levels comparable to Brunswick’s,ours, regarding proposed CEO compensation levels for the CEO. Criteria used to identify the peer group include:

Size: Companies with revenues that generally range from one-half to two times Brunswick’s total annual revenue;
Business Focus: Publicly-traded manufacturing companies; and
Consistency: The peer group should be relatively stable. Companies historically have been eliminated if they were acquired or if their revenue was outside the range referenced above.

Brunswick’s peer group in 2015 consisted of the following companies:

BorgWarnerCurtiss-WrightHarley-DavidsonMattelSPX Corp
Briggs & StrattonDana HoldingHasbroPolaris IndustriesTenneco
CraneFlowserve CorpJarden CorpSnap-On ToolsTimken
Leggett & Platt

Consistent with past practice, Brunswick assessed the appropriateness of the peer group during 2015, which resulted in changes to the peer group composition. The result of these peer company changes will take effect for 2016 compensation benchmarking. The next review of the peer group is scheduled for 2017.

Brunswick isand other plan design elements. We are the largest domestic, publicly-traded company in the recreational marine industry, with total revenues approximately 20 times those of the next largest publicly-traded U.S. recreational boat manufacturer as of December 31, 2015.2017. As a result, there are no direct competitors in the compensation peer group. Criteria used to identify the peer group include:

Size: Companies with revenues that generally range from one-half to two times our total annual revenue.

Business Focus:Publicly-traded manufacturing companies.

Consistency: The peer group should be relatively stable. Companies historically have been eliminated if they were acquired or if their revenue was outside the range referenced above.

Consistent with past practice, Brunswick assessed the appropriateness of the peer group during 2017, which resulted in changes to the peer group composition. The result of these peer company changes will take effect for 2018 compensation benchmarking. The next review of the peer group is scheduled for 2019.

 

For all other NEOs, Brunswick assesseswe assess the competitiveness of executive compensation every two years using manufacturing industry survey data purchased from Aon Hewitt. Brunswick’sEach position is benchmarked based on scope of responsibilities, revenue size of applicable business unit, and level within the organizational hierarchy. We design our target pay mix and total compensation opportunities are designed to approximate the median of the market. In 2015, the Company2017, we completed thea competitive benchmark assessment which confirmed that, on average, Brunswick’sour target total direct compensation (base salary, annual bonus, and long-term incentives) for the senior management positions, including the NEOs, approximates the median of competitive practice. We will complete this analysis again in 2019.

 

Internal EquityThe chart to the right summarizes the CEO’s total direct compensation as compared to the median of the market data for his role as well as the average NEO total direct compensation compared to the average applicable market data job matches for each of their roles. This chart reinforces that we follow our philosophy to target executive compensation to the median of the market.

 

Brunswick establishesINTERNAL EQUITY

We establish compensation ranges for positions with similar characteristics and scope of responsibility, including NEO positions, even if such ranges differ somewhat from comparable positions at companies in our peer group.positions. Balancing competitiveness with internal equity helps support management development and movement of talent throughout Brunswick’sour worldwide operations. Differences in actual compensation between employees in similar positions result from individual performance, future potential, and division financial results. This effort also helps Brunswickus promote talented managers to positions with increased responsibilities and provides meaningful developmental opportunities.opportunities for our employees.

 

Reward Corporate, Division and Individual PerformanceREWARD CORPORATE, DIVISION, AND INDIVIDUAL PERFORMANCE

 

Recognizing corporate, division, and individual performance in compensation helps reinforce the importance of working together and furthers Brunswick’sour pay-for-performance philosophy. For 2015, Brunswick2017, we funded incentives for all participants based on the achievement of corporate and division performance goals and allocated incentives based on individual contributions. For those NEOs with division responsibility, we focused incentives were focused on the financial performance of their divisions, but also included a significant portion tied to overall corporate results.

 

2017 PEER GROUP:

Carlisle

Colfax Corp

Crane

Curtiss-Wright

Dana Holding

Flowserve Corp

Harley-Davidson

Harman International

Hasbro

Leggett & Platt

Mattel

Meritor

Oshkosh

Polaris Industries

Regal-Beloit Corp

Snap-On Tools

Timken

BRUNSWICK CORPORATION -2016 Proxy Statement28AVERAGE NEO TARGET
DIRECT COMPENSATION
VS. MARKET MEDIAN


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What Is Rewarded?

WHAT IS REWARDED?

 

Brunswick designsWe design NEO compensation to reward achievement of budgeted financial results, namely EPS, EBIT, Cash Flow Return on Investment (CFROI) and, Operating Margin, Brunswick total shareholder return (both absolute and on a relative basis), and individual performance.

 

Achievement of Targeted ResultsACHIEVEMENT OF TARGETED RESULTS

 

Earnings Per Share, Earnings Before Interest and Taxes, Cash Flow Return on Investment, Operating Margin and Relative Total Shareholder Return

 

The CompanyWe established the 20152017 BPP annual incentive formula to recognize and reward outstanding performance by both the overall Company and by itsour divisions. Specifically, the BPP for the NEOs provides that funding is based on the achievement of corporate EPS and division-specific EBIT. For Corporate NEOs (Messrs. McCoy, Schwabero, Metzger and Lockridge), 2015 BPP was weighted 50 percent on overall Brunswick EPS performance and 50 percent on the EBIT performance of the divisions. In this calculation, each of the divisions was equally weighted. Mr. Pfeifer’s 2015 BPP was also weighted 50 percent on overall Brunswick EPS performance but the remaining 50 percent was based solely on Mercury Marine EBIT.

 

The following chart shows the relative weighting of the performance measures used under the BPP for NEOs.

 

 CorporateCorporate Division
ParticipantsResultsDivision Results
Corporate Participants50% EPS

CORPORATE

(Messrs.
Schwabero and
Metzger)

 Boat GroupGroup: 16.67% EBIT
50% EPSMercury Marine: 16.67% EBIT
 Mercury MarineFitness: 16.67% EBIT
Life Fitness16.67% EBIT
Division Participants

DIVISION

(Messrs. Pfeifer
(Mercury), Irick
(Fitness), and
Bower (Boat
Group))

50% EPS50% EBIT of their Division

 

Each of the NEOs also participate in the three year performance share plan, which rewards performance based on the achievement of both CFROI and Operating Margin over a three-year period in addition to a potential modifier at the end of the three-yearperformance period based on Brunswick’s three yearthree-year TSR performance against the TSR of certain companies in the Global Industry Classification Standard (GICS) “Leisure Products” sub-industry.

 

The Compensation Committee believes that EPS and division EBIT are appropriate measures to be useduse in our annual incentive plan. Earnings figures, specifically EPS, are widely tracked and reported by analysts and used as a measure to evaluate Brunswick’sour performance. Division EBIT is important as it shows each

division’s contribution to the Company’sour overall earnings performance. Both CFROI and Operating Margin are important within the long-term performance share plan to measure how effective the Company manages itseffectively we manage our cash and business to create long-term sustainable performance for itsour shareholders.

 

Our grants of Performance Shares and RSUs inherently reward absolute TSR because the ultimate earned value of each share will depend on our TSR during the performance/vesting period. In addition, the number of Performance Shares actually earned will depend on our relative TSR performance against other leisure products companies. BothWe use absolute and relative TSR metrics are used because they align the earned compensation amounts with our market performance and our shareholders’ experience.

 

Stock Price AppreciationSTOCK PRICE APPRECIATION

 

Stock price appreciation is a significant component of total shareholder return and thus shareholder value creation. Stock price appreciation affects the value of Brunswick’sour equity grants, including Stock Appreciation Rights (SARs), Restricted Stock Units (RSUs)RSUs and Performance Shares.

 

Individual PerformanceINDIVIDUAL PERFORMANCE

 

The Company assesses individual performance viaWe use the Performance Management Process (PMP). to assess individual performance. The PMP was created to help employees better understand Brunswick and division-specific goals, and to define their role in and contribution towardstoward achieving these goals. The Company believesWe believe that the PMP is an effective tool in assessing performance against individual goals.

 

Once Brunswick and division goals are established, salaried employees (including NEOs) work with their supervisors to set individual goals aligned with the Company’s strategic direction. Employees establish goals for specific initiatives, major responsibilities key to their positions, and individual developmental requirements, and their managers identify specific core competencies that employees are expected to achieve. The Chief Executive Officer’s performance is jointly assessed by the Compensation Committee and the Nominating and Corporate Governance Committee of the Board of Directors jointly assess the CEO’s performance with input from all members of the Board of Directors. The Chief Executive OfficerCEO assesses performance of other NEOs with review by the Compensation Committee.

 

Individual performance affects base salary increases, annual incentives, and equity grant decision-making. As part of the PMP process, managers have the ability to adjust all elements of compensation based on the individual’s attainment of annual goals and performance against critical competencies, which determines the content of the individual’s annual performance review and the overall PMP rating.


 

BRUNSWICK CORPORATION -2016 Proxy Statement29

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Compensation Elements

COMPENSATION ELEMENTS

 

Brunswick structures itsWe structure our compensation to reflect the Company’sour business objectives and compensation philosophy. The particular elements that comprise the Company’sour compensation programs for senior executives are summarized below,below; along with an explanation of why Brunswickwe selected each compensation element,element; how the amount and formula are determineddetermined; and how decisions regarding that compensation element fit into the Company’sour overall compensation objectives and programs.

 

Base SalaryBASE SALARY

 

Base salary is fixed compensation for Brunswick’sour NEOs. It is designed to provide a minimum level of pay that reflects each executive’s position and scope of responsibility, leadership skills, and individual performance, as demonstrated over time. When establishing an executive’s base salary, the Companywe also targetstarget the median pay level offered bywithin the companies in its peer groupmarket for positions with similar responsibilities and business size. A competitive base salary is important for attracting and retaining the executives needed to lead the business.

 

Brunswick reviewsWe review salaries on an annual basis to ensure they are externally competitive, reflect individual performance, and are internally equitable in relation to other Brunswick executives. The Company makesWe make salary adjustments on a periodic basis in response to market practices and to provide merit increases. Additionally, the base salary component serves as the foundation of executives’ total pay, as incentives and benefits are generally computed as a function of base salary, which allows the Companyus to link performance and pay. As illustrated by the following chart, the average merit increase, excluding promotional or market adjustments, of NEO salary from 20132015 to 20152017 was 4.53.1 percent.

 

  2013   2014   2015   Avg 
McCoy 5.0%  0.0%  4.8%  3.3%
Schwabero 12.4%  10.0%  3.1%  8.5%
Metzger 0.0%  5.4%  4.1%  3.2%
Pfeifer 4.7%  0.0%  9.2%  4.6%
Lockridge 4.9%  0.0%  4.0%  3.0%
Average Merit Increase             4.5%
 201520162017Avg
SCHWABERO3.1%0.0%5.0%2.7%
METZGER4.1%0.0%5.0%3.0%
IRICKn/an/an/an/a
PFEIFER9.2%0.0%5.3%4.8%
BOWER2.9%0.0%3.0%2.0%
Average Merit Increase: 3.1%

Annual Incentive Plan

 

Brunswick’sANNUAL INCENTIVE PLAN

Our annual incentive plan, the BPP, is the primary compensation element used to reward accomplishments against established business goals within a given year.

 

Brunswick setsWe set the BPP target funding based on planned performance for the year, as approved by the Board of Directors. The BPP limits funding to no more than 200 percent of target funding, with the Compensation Committee approving corporate and division plan metric amounts within a range from 0 percent to 200 percent based on its review of the Company’sour performance against pre-established targets. Starting in 2017, the threshold payout level for bonus awards is 25% of final blended corporate and division performance. Target funding is equal to salary paid in the year multiplied by the target percentage for each participant. For 2015,2017, the percentage of salary targets under the BPP for NEOs ranged from 8075 percent to 150125 percent.

The Company determinesWe determine individual awards using: overall funding as approved by the Compensation Committee; the individual’s pro-rata portion of approved funding as adjusted for individual performance; and other factors deemed to be relevant. For 2015,2017, the Compensation Committee approved NEO payouts ranging from 8544 percent to 139103 percent of target opportunity. The performance measures required to support funding at 100 percent of target opportunity for all NEOs in 20152017 were Earnings Per Share of $2.77$3.97 and the following internal EBIT target levels for the business units: Mercury Marine: $327.1$380.6 million; Boat Group: $65.8$102.9 million; and Life Fitness: $125.3Fitness Division: $148.5 million. The BPP plays an important role in the Company’sour overall compensation structure, as it signals “what is important” and “what is expected” for the year from the standpoint of corporate, division, and/or individual results. Additionally, the BPP serves to focus executives on achieving current objectives, which are deemed necessary to attain long-term goals, and it establishes appropriate performance and annual incentives by rewarding divisions and individuals within those units for actual performance.

 

Long-Term IncentivesThe design of the 2018 annual incentive plan is similar to that of 2017.

 

BrunswickLONG-TERM INCENTIVES

We continually monitorsmonitor what might be the most appropriate design of itsour long-term incentive plans, taking into consideration both competitive practice and what would drive the most appropriate behavior of the participants. Prior to 2010, SARs were identified as the sole award used to provide annual long-term incentive opportunities to better align the interests of management with those of shareholders. Since then, there has been a shift in long-term incentive mix. To reinforce the use of performance-based compensation, since the 2013 annual grant, certain senior executives, including the NEOs, have had 50 percent of their target long-term incentive opportunity granted in Performance Shares and the balance in RSUs. This progressive transition to incorporateThe use of RSUs and Performance Shares into the Company’sin our long-term incentive mix wasis designed to align the Company’sour incentive program with competitive pay practices and to reinforce pay for performance and an element ofto encourage retention due to the three-year cliff vesting schedule for RSUs. The progression from 2011 through 2015 of the Company’s mix of long-term incentives for the NEOs is shown on the following graph.

 

LTI Mix

Performance Shares

Shares. In 2015,2017, we granted all NEOs were granted Performance Share awards. The 20152017 Performance Shares are earned over a three-year performance period based on achievement of two financial metrics, with payout between 0 percent and 200 percent of the target opportunity. At the end of the three years, 75 percent of the award will be based on three-year annual average CFROI achievement and 25 percent will be earned based on

BRUNSWICK CORPORATION -2016 Proxy Statement30

three-year annual average Operating Margin attainment. The level of performance required for target payout is based on three-year strategic plan targets. The Compensation Committee believes these targets are challenging yet reasonably attainable. The final payout at the end of the three-year period may be increased or decreased by an additional 20 percent based on Brunswick’s three-year TSR performance against the TSR of certain companies in the Global


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Industry Classification Standard (GICS) “Leisure Products” sub-industry. Performance in the bottom quartile against the GICS comparator group reduces the Performance Share award payout by 20 percent and performance in the top quartile increases the Performance Share award payout by 20 percent, with a payout cap of 200 percent of target. Performance between the 25th25th and 75th75th percentile of the GICS comparator group results in no modification of the award payout. The design of the Performance Share award provides multiple benefits, including focusing management on the success of key strategic initiatives via theand their impact on CFROI and Operating Margin metrics, as well as strengthening the alignment with long-term shareholder interests with the TSR modifier at the conclusion of the three-year performance period.

 

The Company revised the design of the 2018 Performance Share award is similar to that of 2017.

The 2015 Performance Share award fromwas earned over a three-year performance period which ended on December 31, 2017. The plan design of these awards is similar to that of the 2014 award. The 20142017 Performance Share award was based on achievementdescribed above. The targets required to support funding at 100 percent of CFROI targets over a 12-month period with an additional two-year vesting period. The final payout is then adjusted attarget opportunity for all NEOs for the end of the three-year2015-2017 performance period by relativewere: CFROI: 25.0 percent and Operating Margin: 10.4 percent. Based on performance against these targets, the Compensation Committee approved an initial share determination of 136 percent of target opportunity. TSR to a comparator group. Whileperformance against the TSR modifier metric and design was maintained with the 2015 Performance Share award,established peer group for the performance period for CFROIresulted in company performance between the 25th and 75th percentile of the peer group. Therefore, this did not result in additional modification of +/- 20 percent of the award and the final award payout was lengthened to align executive focus with our long-term business strategy and shareholder interests. In addition, a three-year Operating Margin metric was incorporated into the 2015 Performance Share award.136 percent.

 

Other Long-Term Incentives

Incentives. In addition to Performance Shares, Brunswickwe currently utilizesutilize RSUs. Brunswick believesWe believe that RSUs are an important component of itsour compensation structure because each award increases linkage to shareholders’ interests by rewarding stock price appreciation and tying wealth accumulation to performance. Additionally, RSUs help to reinforce team performance, encourage senior executives to focus on long-term performance, and function as a retention incentive through the vesting period. Past long-term incentive awards have included SARs. The recently approved 2014 Stock Incentive Plan does not permit the “re-pricing” of stock options or SARs, including the cancellation of underwater stock options or SARs for cash or another award, without the approval of our shareholders. Although Brunswick believes SARs are an effective way to align executives with the shareholders, Brunswick has not granted SARs since 2013 and has, rather, granted a higher proportion of Performance Shares to better reinforce the Company’s pay-for-performance philosophy.

 

TheWe base the size of long-term incentive awards for NEOs is based on the following factors:

 

Peer median total direct target compensation minus target cash compensation (base salary plus individual BPP target cash incentive targets). This determines a reference point for the dollar value of the total equity grant target and is consistent with targeting median pay for consistently solid Company and individual performance.
Grant size is based on a fixed dollar target that is established every two years when competitive benchmark compensation information is updated. The actual share award amounts for each NEO are determined using a Black-Scholes-Merton valuation for SARs (when applicable), a Monte Carlo valuation for Performance Shares and the Company’s stock price on the date of the grant for RSUs.
Market median total direct target compensation minus target cash compensation (base salary plus individual BPP cash incentive targets). This determines a reference point for the dollar value of the total equity grant target and is consistent with targeting median pay for consistently solid Company and individual performance.

 

Grant size is based on a fixed dollar target that is established every two years when competitive benchmark compensation information is updated. We determined the actual share award amounts for each NEO using a Monte Carlo valuation for Performance Shares and the Company’s stock price on the date of the grant for RSUs.

Share Ownership RequirementsSHARE OWNERSHIP REQUIREMENTS

 

In order to ensure continual alignment with itsour shareholders, Brunswick maintainswe maintain share ownership requirements for itsour officers. This share ownership policy calculates minimum required ownership levels as a multiple of the officer’s base salary.

 

The current NEO share ownership requirements are as follows:

 

TierTIER I Management LevelNEOOwnership
Requirement
IMANAGEMENT LEVEL: Chief Executive Officer
McCoy,NEO: Schwabero5.0 times salary
IIChief Financial Officerand DesignatedExecutive OfficersMetzger, Pfeifer3.0 times salaryOWNERSHIP REQUIREMENT: 5.0 Times Base Salary
IIIOther Executive OfficersLockridge2.0 times salary
IVOther Officers  
TIER II 
1.0 times salaryMANAGEMENT LEVEL:Chief Financial Officer and
Designated Executive Officers
NEO: Metzger, Irick, Pfeifer, Bower
OWNERSHIP REQUIREMENT: 3.0 Times Base Salary

 

Officers who do not meetingmeet the ownership requirements will be required tomust retain shares having a value equal to 50 percent of the after-tax profit from the Common Stock acquired under our equity plans. For purposes of calculating compliance with the requirements, “shares owned” include shares directly owned, shares owned by immediate family members residing in the same household, shares held in trust, share equivalents held in the Company’sour tax-qualified defined contribution plans and deferred compensation plans, and RSUs. Unexercised stock options and SARs and outstanding Performance Shares do not count as “shares owned.” For those officers approaching retirement, ownership requirements will beare reduced as follows: 80 percent of target for those age 63; 60 percent of target for those age 64; and 50 percent of target for those age 65 and above.

 

The Compensation Committee reviews compliance with these share ownership requirements on an annual basis, with allbasis. All NEOs, except for Mr. Irick, who was hired during 2017, and Mr. Bower, who was promoted to his current role during 2016, are currently in compliance with the stated requirements. Therefore, Messrs. Irick and Bower will be subject to the retention ratio until they achieve the required ownership level. Please see the Narrative to Director Compensation Table for information regarding share ownership guidelines for directors.Directors.

 

ClawbacksCLAWBACKS

 

The Compensation Committee can require the repayment of all or a portion of previous BPP awards as it deems appropriate in the event of certain misconduct, including misconduct that causes a restatement of financial results. In addition, for those who have entered into Terms and Conditions of Employment with Brunswick, including each of the NEOs, the Compensation Committee has expanded the types of payments the Company can recover in the event of a violation of the restrictive covenants set forth in the Terms and Conditions of Employment to include any severance payments received by the executive and any gain realized as a result of the exercise or vesting of equity awards beginning 12 months prior to termination.


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Anti-Hedging and Anti-Pledging PolicyANTI-HEDGING AND ANTI-PLEDGING POLICY

 

No director,Director, NEO, or other employee may engage in hedging or monetization transactions or similar arrangements with respect to Common Stock, including the purchase or sale of puts, calls, or options on Common Stock (other than options granted by Brunswick), or the use of any other derivative instruments to hedge or offset any decrease in the market value of the Common Stock. In addition, no director,Director, NEO, or other employee may pledge Common Stock as collateral.


 

BRUNSWICK CORPORATION - 2016 Proxy Statement31

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Post-Employment Compensation

POST-EMPLOYMENT COMPENSATION

 

Post-employment compensation elements that are not currently offered to salaried employees in general are summarized below.

 

PlanDescriptionParticipant(s)
BRUNSWICK
RESTORATION
PLAN

The Restoration Plan is a non-qualified plan that provides a retirement benefit consistent with that of employees who are not affected by the IRS compensation and benefit limits.

The Restoration Plan ensures that employees with covered compensation or retirement plan contributions above IRS qualified defined contribution plan limits receive the full amount of their intended retirement benefits. If an employee elects to participate in the Restoration Plan, 401(k) contributions and Brunswick’s match on these contributions above the IRS limit are credited to this plan. In addition, Brunswick’s variable retirement contributions for eligible employees are automatically credited to their Restoration Plan accounts.

All NEOs
SUPPLEMENTAL
PENSION PLAN

The Supplemental Pension Plan ensures that employees with covered compensation or pension benefits above Internal Revenue Service (IRS) qualified defined benefit plan limits receive the full amount of their intended pension benefits. Pursuant to the Supplemental Pension Plan, we pay, on a non-qualified basis, the difference between an employee’s earned defined benefit pension and the level of benefits that is permissible by IRS qualified limits. The Supplemental Pension Plan provides a retirement benefit that is consistent with those who are not affected by the IRS compensation and benefit limits and reflects an individual’s full career and covered pay earned.

Of the NEOs, only Mr. Metzger participates, or has a balance, in the Supplemental Pension Plan. Effective December 31, 2009, we froze the Supplemental Pension Plan and ceased all benefit accruals.

Metzger
THE 2005
ELECTIVE
DEFERRED
INCENTIVE
COMPENSATION
PLAN
The 2005 Elective Deferred Incentive Compensation Plan provided eligible employees the opportunity to save in a tax-deferred manner. In 2008, we suspended participation in the plan. The Compensation Committee will continue to assess the competitive and regulatory landscape to determine if future enrollment in this plan is warranted.Schwabero
Pfeifer
THE 2005
AUTOMATIC
DEFERRED
COMPENSATION
PLAN

The 2005 Automatic Deferred Compensation Plan defers payment of certain compensation that would otherwise be non-tax-deductible to Brunswick by reason of Section 162(m) of the Internal Revenue Code until six months after employment ends. The 2005 Automatic Deferred Compensation Plan preserves our ability to take a tax deduction for senior executives’ compensation. Senior executives are required to defer receipt of non-deductible compensation in excess of $1.5 million in order to limit non-deductible compensation under Section 162(m) of the Internal Revenue Code. For amounts deferred in cash, financial returns on automatic deferrals are based on either: (i) an interest rate equal to the greater of the prime rate at J.P. Morgan Chase plus two percentage points, or Brunswick’s short-term borrowing rate; or (ii) securities selected by the participant. The two percentage point increment is used to recognize that the NEO defers the receipt of earned compensation until sometime in the future, typically upon retirement or other termination of employment. For amounts deferred in stock, the account is credited with the number of share units equal to the number of shares of Company stock as of the date on which the shares would otherwise have been paid.

Due to the passage of the Tax Cuts and Job Act in December 2017, Section 162(m) was amended to eliminate the previously available exemptions from the tax deduction limit, including the exemptions for (1) qualified performance-based compensation and (2) compensation paid after the Executive’s termination of employment. As a result, the reasons for maintaining the ADC Plan no longer exist (other than for equity awards that were granted prior to November 2, 2017). For this reason, the plan has been amended to cease deferrals of compensation earned on or after January 1, 2018, except for incentive awards that were outstanding prior to such date. This will effectively “wind down” the plan while preserving the grandfathered status of the previously granted or deferred awards.

Schwabero
Pfeifer
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PERQUISITES AND OTHER BENEFITS

 

Of theWe extend certain benefits to NEOs only Mr. Metzger participatesthat we do not offer to salaried employees in or has a balance in, the non-qualified defined benefit retirement plan (the Supplemental Pension Plan). Effective December 31, 2009, the Company froze the Supplemental Pension Plangeneral. These programs help NEOs enhance their understanding of our products, protect their physical health, and ceased all benefit accruals. Participation thereafter in any supplemental pension benefit has been through the Brunswick Restoration Plan.maximize their productivity.

 

Perquisites/BenefitsDescription
EXECUTIVE PRODUCT
PROGRAM
The product program is designed to encourage the use of Brunswick products to enhance understanding and appreciation of our businesses and identify product and business development opportunities. The program provides a product allowance equal to $30,000 for all participants. We do not reimburse the participant for the tax liability associated with the program. The allowance may be applied toward the purchase of Brunswick products at the discounted rates established pursuant to the Brunswick Employee Purchase Program, which is available to all Brunswick employees, as well as any freight costs, parts and accessories, service fees, and other expenses related to the ownership of the Brunswick products purchased.
EXECUTIVE PHYSICAL
PROGRAM
We provide a physical examination program to senior executives that is intended to protect the health of such executives and our investment in our leadership team. The Compensation Committee requires senior executives to have an annual physical examination and, as part of this program, they have immediate access to healthcare providers.
PERSONAL AIRCRAFT
USE
The Chairman and CEO may use the Company aircraft for personal use on a limited basis. This benefit allows for the effective use of the Chairman and CEO’s limited personal time. Other NEOs may occasionally use the Company aircraft for personal use with prior approval from the Chairman and CEO.
LIFE INSURANCE
POLICIES

Of the NEOs, only Mr. Metzger has a Split-Dollar Life Insurance replacement policy (Replacement Policy). The Replacement Policy provides an insured death benefit and allows for capital accumulation. The Sarbanes-Oxley Act of 2002 prohibits loans to executive officers and, as a result of this loan prohibition, combined with changes in taxation of Split-Dollar Life Insurance, we restructured the Replacement Policy in 2004 such that the net present value cost to Brunswick did not increase. Although we continue to cover the costs of the Replacement Policy, Mr. Metzger is now responsible for the actual payment of the annual premium and keeping his policy current.

Pre-2003 loans on these policies were grandfathered under Sarbanes-Oxley and remain outstanding. The loans must be repaid to Brunswick at the scheduled rollout date or upon death (whichever occurs first) per the terms of the Split Dollar agreement. Executives with Split-Dollar Life Insurance replacements do not receive Company-provided basic life insurance coverage. Executives hired since 2003 receive basic life insurance coverage under the same terms as other salaried employees, except that the Company continues to pay for a life insurance policy for Mr. Schwabero that was provided by his former employer. These are grandfathered benefits not available to Executives who became NEOs since 2003.

The Supplemental Pension Plan ensures that employees with covered compensation or pension benefits above Internal Revenue Service (IRS) qualified defined benefit plan limits receive the full amount of their intended pension benefits. Pursuant to the Supplemental Pension Plan, the Company pays, on a non-qualified basis, the difference between an employee’s earned defined benefit pension and the level of benefits that is permissible by IRS qualified limits. The Supplemental Pension Plan provides a retirement benefit that is consistent with those who are not affected by the IRS compensation and benefit limits and reflects an individual’s full career and covered pay earned.

Brunswick Restoration Plan

All NEOs participate in the Brunswick Restoration Plan. The Restoration Plan ensures that employees with covered compensation or retirement plan contributions above IRS qualified defined contribution plan limits receive the full amount of their intended retirement benefits. If an employee elects to participate in the Restoration Plan, 401(k) contributions and Brunswick’s match on these contributions above the IRS limit are credited to this plan. In addition, Brunswick’s variable retirement contributions for eligible employees are automatically credited to their Restoration Plan accounts. This is a non-qualified plan.

The Restoration Plan provides a retirement benefit consistent with that of employees who are not affected by the IRS compensation and benefit limits.

The 2005 Elective Deferred Incentive Compensation Plan

Mr. McCoy, Mr. Lockridge, Mr. Schwabero and Mr. Pfeifer currently maintain balances in the 2005 Elective Deferred Incentive Compensation Plan. The 2005 Elective Deferred Incentive Compensation Plan provided eligible employees the opportunity to save in a tax-deferred manner. In 2008, the Company suspended participation in the plan. The Compensation Committee will continue to assess the competitive and regulatory landscape to determine if future enrollment in this plan is warranted.

The 2005 Automatic Deferred Compensation Plan

The 2005 Automatic Deferred Compensation Plan defers payment of certain compensation that would otherwise be non-tax-deductible to Brunswick by reason of Section 162(m) of the Internal Revenue Code until six months after employment ends. The 2005 Automatic Deferred Compensation Plan preserves Brunswick’s ability to take a tax deduction for senior executives’ compensation. Senior executives are required to defer receipt of non-deductible compensation in excess of $1.5 million in order to limit non-deductible compensation under Section 162(m) of the Internal Revenue Code. For amounts deferred in cash, financial returns on automatic deferrals are based on either: (i) an interest rate equal to the greater of the prime rate at J.P. Morgan Chase plus two percentage points, or Brunswick’s short-term borrowing rate; or (ii) securities selected by the participant. The two percentage point increment is used to recognize that the NEO defers the receipt of earned compensation until sometime in the future, typically upon retirement or other termination of employment. For amounts deferred in stock, the account is credited with the number of share units equal to the number of shares of Company stock as of the date on which the shares would otherwise have been paid. As of December 31, 2015, Mr. McCoy, Mr. Schwabero and Mr. Pfeifer were the only participants with automatic deferrals under this plan.

Life Insurance Policies

Of the NEOs, only Mr. Metzger has a Split-Dollar Life Insurance replacement policy (Replacement Policy). The Replacement Policy provides an insured death benefit and allows for capital accumulation. The Sarbanes-Oxley Act of 2002 prohibits loans to executive officers and, as a result of this loan prohibition, combined with changes in taxation of split-dollar life insurance, Brunswick restructured the Replacement Policy in 2004 such that the net present value cost to Brunswick did not increase. Although the Company continues to cover the costs of the Replacement Policy, Mr. Metzger is now responsible for the actual payment of the annual premium and keeping his policy current.

Pre-2003 loans on these policies were grandfathered under Sarbanes-Oxley and remain outstanding. The loans must be repaid to Brunswick at the scheduled rollout date or upon death (whichever occurs first) per the terms of the Split Dollar agreement. Executives with split-dollar life insurance replacements do not receive Company-provided basic life insurance coverage. Executives hired since 2003 receive basic life insurance coverage under the same terms as other salaried employees, except that the Company continues to pay for a life insurance policy for Mr. Schwabero that was provided by his former employer.

Terms and Conditions of EmploymentTERMS AND CONDITIONS OF EMPLOYMENT

 

All NEOs maintain agreements setting forth their terms and conditions of employment (Agreements). The Agreements memorialize the “at will” nature of the employment relationship, and describe each executive’sExecutive’s duties, compensation, benefits, and perquisites. Additionally, the Agreements consolidate the restrictive covenants that exist during and after employment (e.g., non-competition, confidentiality, non-solicitation).

 

Finally, the Agreements establish and limit the compensation and benefits to which an executive is entitled in the event of termination.

 

Brunswick believesWe believe that offering Agreements to itsour executives helps to ensure the retention of executive experience, skills, knowledge, and background for the benefit of the Company, and the efficient achievement of the Company’sour long-term goals and strategy. Additionally, the Agreements reinforce and encourage the executives’Executives’ continued attention and dedication to duties without the distraction arising from the possibility of a Change in Control. The Agreements do not provide excise tax gross-ups.

 

Perquisites

The Company extends certain benefits to NEOs that it does not offer to salaried employees in general. These programs help NEOs enhance their understanding of Brunswick products, protect their physical health and maximize their productivity.

BRUNSWICK CORPORATION - 2016 Proxy Statement32

2018 PROXY STATEMENT | 42
 

Executive Product Program

Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

 

The product program is designed to encourage the use of Brunswick products to enhance understanding and appreciation of Brunswick’s businesses and identify product and business development opportunities. The program provides a product allowance equal to $30,000 for all participants. The Company does not reimburse the participant for the tax liability associated with the program. The allowance may be applied toward the purchase of Brunswick products at the discounted rates established pursuant to the Brunswick Employee Purchase Program, which is available to all Brunswick employees, as well as any freight costs, parts and accessories, service fees and other expenses related to the ownership of the Brunswick products purchased.

Executive Physical Program

Brunswick provides a physical examination program to senior executives that is intended to protect the health of such executives and Brunswick’s investment in its leadership. The Compensation Committee requires senior executives to have an annual physical examination and, as part of this program, they have immediate access to healthcare providers.

Personal Aircraft Use

The Chairman and Chief Executive Officer may use Company aircraft for personal use on a limited basis. This benefit allows for the effective use of the Chairman and Chief Executive Officer’s limited personal time. Other NEOs may use the Company aircraft for personal use with prior approval from the Chairman and Chief Executive Officer.

Determining Executive CompensationDETERMINING EXECUTIVE COMPENSATION

 

Decisions with respect to specific BPP awards, equity awards, and base salary increases for the current year are normally made at the first Compensation Committee and Board meeting of each year. At this meeting, the Compensation Committee and the Board of Directors also make decisions with respect to the prior year’s performance and BPP funding. Base salary increases are generally effective as of the first full pay period in April.

 

The Compensation Committee reviews and approves equity grant terms and conditions and grant size for NEOs and other senior executives at its first meeting of the year, which is generally held following Brunswick’sour public disclosure of itsour financial results for the prior year.

 

Human Resources and Compensation Committee ReportHUMAN RESOURCES AND COMPENSATION COMMITTEE REPORT

 

The Human Resources and Compensation Committee reviewed and discussed this Compensation Discussion and Analysis with management.

 

Based on that review and discussion, the Human Resources and Compensation Committee recommended to the Board of Directors of Brunswick Corporation that the Compensation Discussion and Analysis be included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2015,2017, and the Company’s Proxy Statement to be filed in conjunction with the Company’s 20162018 Annual Meeting.

 

J. Steven Whisler,Chair
David C. Everitt
Manuel A. Fernandez
HUMAN RESOURCES AND COMPENSATION COMMITTEE 

J. STEVEN
WHISLER (C)

DAVID C.
EVERITT
MANUEL A.
FERNANDEZ

 

BRUNSWICK CORPORATION - 2016 Proxy Statement33

2018 PROXY STATEMENT | 43
 
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

2015 Summary Compensation Table

2017 SUMMARY COMPENSATION TABLE

 

The table below summarizes the total compensation earned by each of the Company’s named executive officers (NEOs)our NEOs for the years ended December 31, 2015, 20142017, 2016, and 2013.2015.

 

Name and Principal
Position
 Year Salary(1) Stock
Awards(2)
 Non-Equity
Incentive Plan
Compensation(3)
 Change in Pension
Value and Non-
qualified Deferred
Compensation
Earnings(4)
 All Other
Compensation(5)
 Total
Dustan E. McCoy(6) 2015 $ 1,125,000 $ 6,500,604 $1,777,000 $188,089 $452,777 $ 10,043,470
Former Chairman and 2014  1,050,000  5,248,048  1,853,000  122,184  518,441  8,791,673
Chief Executive Officer 2013  1,036,539  4,900,084  1,900,000  134,678  498,519  8,469,820
Mark D. Schwabero(7) 2015 $744,231 $2,502,375 $784,000 $- $181,097 $4,211,703
Chairman and Chief 2014  598,077  1,455,188  702,000  -  163,496  2,918,761
Executive Officer 2013  485,192  899,557  700,000  -  134,898  2,219,647
William L. Metzger 2015 $517,500 $1,000,904 $545,000 $29,292 $121,285 $2,213,981
Senior Vice President and 2014  478,269  899,926  563,000  270,642  105,388  2,317,225
Chief Financial Officer 2013  433,077  899,557  490,900  -  90,849  1,914,383
John C. Pfeifer(8) 2015 $479,423 $1,000,904 $429,000 $191 $115,019 $2,024,537
Vice President and 2014  396,538  671,388  370,000  -  105,230  1,543,156
President – Mercury Marine                    
B. Russell Lockridge(9) 2015 $430,615 $500,567 $453,000 $- $130,217 $1,514,399
Vice President and Chief 2014  404,000  429,508  475,000  -  149,101  1,457,609
Human Resources Officer 2013  398,885  430,402  471,500  -  154,741  1,455,528
YearSalary(1)Bonus(6)Stock
Awards(2)
Non-Equity
Incentive Plan
Compensation(3)
Change in
Pension Value
and Non-Qualified
Deferred
Compensation
Earnings(4)
All Other
Compensation(5)
Total
MARK D. SCHWABERO, Chairman and Chief Executive Officer
 2017   $1,036,539     $5,000,340  $821,000     $259,641  $7,117,520 
 2016   $971,154     $4,500,562  $1,035,000     $195,732  $6,702,448 
 2015   $744,231     $2,502,375  $784,000     $181,097  $4,211,703 
WILLIAM L. METZGER, Senior Vice President and Chief Financial Officer
 2017   $523,269     $999,930  $360,000  $59,931  $130,101  $2,073,231 
 2016   $505,000     $999,224  $430,500  $37,684  $169,272  $2,141,680 
 2015   $517,500     $1,000,904  $545,000  $29,292  $121,285  $2,213,981 
JAIME A. IRICK(7), Vice President and President – Fitness Division
 2017   $451,250  $460,000  $1,601,492  $160,000     $229,558  $2,902,300 
JOHN C. PFEIFER, Vice President and President – Mercury Marine
 2017   $493,269     $999,930  $405,000  $346  $134,288  $2,032,833 
 2016   $475,000     $999,224  $377,000  $323  $123,341  $1,974,888 
 2015   $479,423     $1,000,904  $429,000  $191  $115,019  $2,024,537 
HUW S. BOWER(7), Vice President and President – Brunswick Boat Group
 2017   $399,969     $799,952  $160,000     $107,256  $1,467,177 
 2016   $332,061     $448,768  $240,000     $301,434  $1,322,263 

 

(1)The amounts shown in this column constitute actual base salary paid. TheseFor 2015, these amounts reflect that there was an additional pay period in 2015 due to the overlay of biweekly pay periods on calendar years.
Annual salaries as of December 31, 2015 were:

 

   McCoy   Schwabero   Metzger   Pfeifer   Lockridge
  $1,100,000  $750,000  $505,000  $475,000  $420,000

Annual salaries as of December 31, 2017 were:

 

SCHWABEROMETZGERIRICKPFEIFERBOWER
     
$1,050,000$530,000$475,000$500,000$435,000

(2)The amounts shown in this column constitute the aggregate grant date fair value of restricted stock unitsRestricted Stock Units and performance sharesPerformance Shares granted under the Brunswick Corporation 2014 Stock Incentive Plan during the applicable year, computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 – Compensation – Stock Compensation (FASB ASC Topic 718). For assumptions used in the valuation of such awards, see Note 18 to the financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2015.2017. If the highest achievement level is attained, the maximum amounts that would be received with respect to the 2015 performance shares,2017 Performance Shares, calculated using the December 31, 20152017 closing share price, are as follows: Mr. McCoy, $5,849,058; Mr. Schwabero $2,252,746;$4,259,671; Mr. Metzger, $899,078;$851,492; Mr. Irick, $681,415; Mr. Pfeifer, $899,078;$851,492, and Mr. Lockridge, $454,590. Bower, $681,415.
The amount for Mr. Irick in this column also includes the grant date fair value of Restricted Stock Units awarded to him upon his date of hire. This was a one-time equity award as part of a competitive new hire compensation offer.
For further information on these awards, see the Grants of Plan-Based Awards table.
  
(3)The amounts shown in this column constitute payments made under the annual Brunswick Performance Plan (BPP).
  
(4)The amounts shown in this column include:
 
For Mr. McCoy in 2013, 2014 and 2015 and for Mr. Pfeifer in 2015, 2016, and 2017, above-market interest paid on required automatic cash deferrals under the 2005 Automatic Deferred Compensation Plan. Interest earned on investment alternatives selected by the officer in the Restoration Plan is a market rate of return and is therefore not included in this column.
  
 For Mr. Metzger, the actuarial valuesvalue of benefits under Brunswick’s qualified pension plans and the Supplemental Pension Plan on December 31, 20152017 compared to December 31, 2014 are2016 was as follows:

     Present Value of  Present Value of    
     Accumulated Benefit  Accumulated Benefit  Change in Pension
 Name Plan Name @ 12/31/2014 @ 12/31/2015  Value
 William L. Metzger Qualified Pension Plans $849,357  $0  $-
   Supplemental Pension Plan $483,619  $512,911  $29,292

NamePlan NamePresent Value Of
Accumulated Benefit
@ 12/31/2016
Present Value Of
Accumulated Benefit
@ 12/31/2017
Change In Pension
Value
     
William L. MetzgerSupplemental Pension Plan$550,595$610,526$59,931

2018 PROXY STATEMENT | 44
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

 

(5)The amounts shown in this column include the following for fiscal year 2015:2017:
Defined Contribution Plan Contributions: Brunswick contributions to defined contribution programs, including both qualified and non-qualified programs (to provide for contributions in excess of IRS limits) per the contribution formulas detailed in the Narrative to Non-Qualified Deferred Compensation Table are as follows:

SCHWABEROMETZGERIRICKPFEIFERBOWER
QUALIFIED$26,700$26,700$26,700$30,100
NON-QUALIFIED$163,790$76,833$16,808$70,959$39,984

Due to the sign-on bonus Mr. Irick received on his date of hire, his compensation exceeded the 401(a)(17) qualified compensation limit ($270,000 in 2017) prior to electing to participate in the Rewards Plan, therefore there were no contributions to the Qualified Plan.

 

   McCoy   Schwabero   Metzger   Pfeifer   Lockridge
 Qualified$26,200  $26,200  $26,200  $26,200  $26,200
 Non-Qualified$269,920  $109,534  $75,170  $53,469  $62,555

Amounts contributed to the qualified plan include Company match and a Variable Retirement Contribution of four percent and six percent, respectively, on qualified plan limit earnings

Amounts contributed to the qualified plan include Company match and a variable retirement contribution of four percent and six percent, respectively, on qualified plan limit earnings.
Product Program: Brunswick provides a product program for Company officers. This program is designed to encourage the use of Brunswick products to enhance understanding and appreciation of Brunswick’s businesses and identify product integration opportunities. Each year, officers are eligible to select products with an aggregate annual value of up to $30,000. The allowance may be applied toward the purchase of Brunswick products at the discounted rates established pursuant to the Brunswick Employee Purchase Program, as well as any freight costs, parts and accessories, service fees and other expenses related to the ownership of the Brunswick products purchased. However, the Company does

Product Program: Brunswick provides a product program for Company officers. This program is designed to encourage the use of our products to enhance understanding and appreciation of our businesses and identify product integration opportunities. Each year, officers are eligible to select products with an aggregate annual value of up to $30,000. The allowance may be applied toward the purchase of our products at the discounted rates established pursuant to the Brunswick Employee Purchase Program, as well as any freight costs, parts and accessories, service fees, and other expenses related to the ownership of the Brunswick products purchased. However, we do not reimburse executives for the associated tax liability as a result of the purchases or value received from the program.

The incremental cost of products selected, which is based on the discounted prices established pursuant to the Brunswick Employee Purchase Program, is as follows:

SCHWABEROMETZGERIRICKPFEIFERBOWER
$30,000$8,656$7,973$30,000$30,000

Life Insurance: The Sarbanes-Oxley Act of 2002 prohibits loans to executive officers. As a result of this loan prohibition, combined with changes in taxation of split-dollar life insurance, we restructured existing Split-Dollar Life Insurance policies in 2004 such that the net present value cost to Brunswick did not increase. Mr. Metzger is now responsible for payment of the annual premium and keeping his policy current. Annual payments to Mr. Metzger in connection with his payment of premiums are:

NameAmountPolicy-Mature Date
METZGER$11,98007/01/2026

 

BRUNSWICK CORPORATION - 2016 Proxy StatementMr. Metzger is not provided any life insurance through the Company’s basic life program for employees.34

Brunswick pays an annual premium of $9,300 for Mr. Schwabero to continue a life insurance policy provided by his former employer.

The incremental cost of products selected, which is based on the discounted prices established pursuant to the Brunswick Employee Purchase Program, is as follows:

   McCoy   Schwabero   Metzger   Pfeifer   Lockridge 
  $30,000  $30,000  $7,935  $30,000  $30,000 

 

Personal Usage of Company Aircraft: Mr. Schwabero utilized the Company aircraft for personal use on a limited basis. The incremental cost to Brunswick for such usage during 2017 was $20,304 for Mr. Schwabero. This incremental cost to the Company for use of the corporate aircraft is based on the variable operational costs of all flights, including fuel, maintenance, flight crew travel expense, catering, communications, and fees, including flight planning, ground handling, and landing permits.

Life Insurance: The Sarbanes-Oxley Act of 2002 prohibits loans to executive officers. As a result of this loan prohibition, combined with changes in taxation of split-dollar life insurance, Brunswick restructured existing split-dollar life insurance policies in 2004 such that the net present value cost to Brunswick did not increase. Mr. Metzger is now responsible for payment of the annual premium and keeping his policy current. Annual payments to Mr. Metzger in connection with his payment of premiums are:

   Metzger 
   $11,980 
 Policy Maturity Date  07/01/2026

 

Relocation: Upon his hire to his new role, Mr. Irick relocated to the Rosemont, Illinois area from Bratenahl, Ohio. The incremental cost to Brunswick of his relocation was $199,219. Mr. Bower received cost of living adjustments from his move last year from Edgewater, Florida to the Mettawa, Illinois area. The incremental costs to Brunswick of these payments was $1,322.

Mr. Metzger is not provided any life insurance through the Company’s basic life program for employees.
Brunswick pays the annual premium of $9,300 for Mr. Schwabero to continue the life insurance policy provided by his former employer.
Personal Usage of Company Aircraft: Mr. McCoy, Mr. Schwabero and Mr. Lockridge utilized the Company aircraft for personal use on a limited basis. The incremental cost to Brunswick for such usage during 2015 was $119,742 for Mr. McCoy, $1,463 for Mr. Schwabero and $2,407 for Mr. Lockridge. This incremental cost to the Company for use of the corporate aircraft is based on the variable operational costs of all flights, including fuel, maintenance, flight crew travel expense, catering, communications and fees, including flight planning, ground handling and landing permits.
Other Benefits: Each of the NEOs received the following perquisites and other personal benefits, none of which exceeded $25,000: (a) an annual executive physical examination; and (b) a service providing 24-hour access to immediate healthcare.
There are no tax gross-ups related to any executive benefits.

Other Benefits: Each of the NEOs received the following perquisites and other personal benefits, none of which exceeded $25,000: (a) an annual executive physical examination; and (b) a service providing 24-hour access to immediate healthcare.

There are no tax gross-ups related to any executive benefits.

 

(6)The amounts in this column represent cash sign-on payments that Mr. McCoy resignedIrick received as Chairman and Chief Executive Officer effective February 11, 2016.part of his new hire compensation offer paid in January 2017. A total of $460,000 was paid: $360,000 which represents the foregone 2016 annual incentive amount from his previous employer, plus $100,000 cash payment upon his date of hire.
  
(7)Mr. Schwabero was appointed Chairman and Chief Executive Officer effective February 11, 2016.
(8)Mr. PfeiferBower was not a Named Executive OfficerNEO in 2013.2015. Therefore, this table does not provide 20132015 data for him. Mr. Irick was not a NEO in 2015 or 2016. Therefore, this table does not provide 2015 or 2016 data for him.

CEO PAY RATIO DISCLOSURE

Per new SEC reporting requirements, companies are required to disclose the ratio between the CEO total compensation to the total compensation of the median employee for the 2017 compensation year. The ratio of CEO pay ($7,117,520) to the median worker pay ($46,840) is 152:1. The ratio is a reasonable estimate, calculated in a manner consistent with applicable SEC rules.

To determine the median employee, we completed the data gathering and analysis for our 15,000 global employees located in 32 countries, of which 60% are hourly, manufacturing, and distribution employees. We utilized a measurement date of October 1, 2017, and used a total compensation definition that consisted of actual base pay earnings, overtime earnings, and annual incentives paid to all employees from the beginning of the 2017 year through the measurement date. We annualized pay for those who commenced work or were on an unpaid leave of absence during 2017. This data was gathered for our entire global workforce to identify the median employee, except that an exclusion was made for 51 employees who were previously employees of Lankhorst Taselaar, which we acquired in September 2017. Once the 2017 year ended, we gathered the median employee final total compensation utilizing the same methodology that is used for NEOs as set forth in the Summary Compensation Table to determine the ratio.

As part of Brunswick’s total rewards philosophy, we strive to attract and retain our workforce with market competitive compensation and benefits which will motivate performance and provide alignment with the Brunswick strategic goals for the organization. We drive to be an employer of choice and provide a differentiated and fulfilling employment experience to each of our talented employees. Part of that strategy is to provide a compensation package that is determined based on the individual’s role within the organization. We set pay levels based on the respective labor markets in which our various employee segments operate to ensure that we can attract and retain the best talent for each role within the organization. We believe that our current talent and workforce compensation strategy meets the needs of the business, shareholders, and employees.

2018 PROXY STATEMENT | 45

 
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices
(9)Mr. Lockridge has provided notice of his intent to retire effective March 31, 2016.

 

2015 Grants of Plan-Based Awards2017 GRANTS OF PLAN-BASED AWARDS

 

    Estimated Future Payouts
Under Non-Equity Incentive
Plan Awards(1)
 Estimated Future Payouts
Under Equity Incentive
Plan Awards(2)
      
Name Grant
Date
 Threshold Target Maximum Threshold Target Maximum All Other Stock
Awards: Number
of Shares of Stock
or Units(3)
 Grant Date Fair
Value of Stock
Awards(4)
Dustan E. McCoy 1/1/2015 $- $ 1,687,500 $ 3,375,000               
  2/11/2015           -  57,900  115,800    $3,252,243
  2/11/2015                    60,300 $3,248,361
Mark D. Schwabero 1/1/2015 $- $744,231 $1,488,462               
  2/11/2015           -  22,300  44,600    $1,252,591
  2/11/2015                    23,200 $1,249,784
William L. Metzger 1/1/2015 $- $517,500 $1,035,000               
  2/11/2015           -  8,900  17,800    $499,913
  2/11/2015                    9,300 $500,991
John C. Pfeifer 1/1/2015 $- $383,538 $767,076               
  2/11/2015           -  8,900  17,800    $499,913
  2/11/2015                    9,300 $500,991
B. Russell Lockridge 1/1/2015 $- $430,615 $861,230               
  2/11/2015           -  4,500  9,000    $252,765
  2/11/2015                    4,600 $247,802
 Estimated Future Payouts Under
Non-Equity Incentive Plan Awards(1)
Estimated Future Payouts Under
Equity Incentive Plan Awards(2)
   
      
      
Grant
Date
ThresholdTargetMaximumThresholdTargetMaximumAll Other
Stock
Awards:
Number of
Shares of
Stock or
Units(3)
Grant Date
Fair Value
of Stock
 Awards(4)
MARK D. SCHWABERO, Chairman and Chief Executive Officer
  1/1/17    $1,295,673  $2,591,346                
2/15/17              38,570   77,140     $2,500,107 
2/15/17                    41,190  $2,500,233 
WILLIAM L. METZGER, Senior Vice President and Chief Financial Officer
  1/1/17    $523,269  $1,046,539                
2/15/17              7,710   15,420     $499,762 
2/15/17                    8,240  $500,168 
JAIME A. IRICK, Vice President and President – Fitness Division
  1/1/17    $361,000  $722,000                
1/19/17                    14,600  $801,540 
2/15/17              6,170   12,340     $399,939 
2/15/17                    6,590  $400,013 
JOHN C. PFEIFER, Vice President and President – Mercury Marine
  1/1/17    $394,615  $789,231                
2/15/17              7,710   15,420     $499,762 
2/15/17                    8,240  $500,168 
HUW S. BOWER, Vice President and President – Brunswick Boat Group
  1/1/17    $299,977  $599,954                
2/15/17              6,170   12,340     $399,939 
2/15/17                    6,590  $400,013 

 

(1)Consists of threshold, target, and maximum awards under the 20152017 BPP.
(2)Consists of performance sharesPerformance Shares awarded under the Brunswick Corporation 2014 Stock Incentive Plan. Performance sharesShares vest and convert to shares of Brunswick Common Stock at the end of the three-year performance period based on the final plan performance.
(3)Consists of RSUs awarded under the Brunswick Corporation 2014 Stock Incentive Plan. Awards vest on the third anniversary of the grant date unless the Rule of 70 or Age 62 is met.date.
(4)The amounts shown in this column constitute the aggregate grant date fair value of equity awards granted under the Brunswick Corporation 2014 Stock Incentive Plan during 2015,2017, computed in accordance with FASB ASC Topic 718. For assumptions used in the valuation of such awards, see Note 18 to the financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2015.2017.

 

BRUNSWICK CORPORATION - 2016 Proxy Statement35

2018 PROXY STATEMENT | 46
 

Narrative to Summary Compensation Table and Grants of Plan-Based Awards Table

Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

 

Equity Compensation Plan Information and AwardsEQUITY COMPENSATION PLAN INFORMATION AND AWARDS

 

Brunswick granted RSUs and Performance Shares to all NEOs in 20152017 pursuant to the Brunswick Corporation 2014 Stock Incentive Plan. RSUs areBrunswick generally grantedgrants RSUs annually and they typically vest 100 percent on the third anniversary of the grant date. Performance Shares are generally granted annually and, if earned, typically vest 100 percent at the end of a three-year performance period. The terms of the awards reflect the use of the “Rule of 70 or Age 62” (as described below)to the right), along with the inclusion of an additional provision that would pro-rate the grant in the event of termination prior tobefore December 31 in the first anniversary ofyear the date of grant is awarded, provided the participant had met the appropriate retirement definition in the terms and conditions of the award. Providing for a “prorated” grant serves to keep the decision about retirement timing independent of the vesting schedule of equity-based compensation. Of the NEOs, Mr. McCoy, Mr. Schwabero Mr. Metzger and Mr. LockridgeMetzger meet the Rule of 70 or Age 62 provision. Please see the “Other Potential Post-Employment Payments” section for a description of the treatment of equity awards following an involuntary termination of employment or a Change in Control.

Rule ofRULE OF 70 or AgeOR AGE 62

 

The terms and conditions of SARs, RSUs, and Performance Shares each provide for accelerated vestingforfeiture of the award in certain terminationif an executive terminates employment before the end of employment situations upon attainment of either:the vesting period, except if: (i) the sum of the individual’s age plus years of service beingis equal to or greater than 70; or (ii) the individual is age 62 or over (Rule of 70 or Age 62). Once the Rule of 70 or Age 62 is achieved,met, and if the employee’s employment is terminated (other than for cause or due to death or permanent disability), the applicable awards are treated as follows:

 

- SARs -

SARs: If termination occurs on or after the first anniversaryDecember 31 of the year the grant is awarded, vesting continues on the normal vesting schedule. If termination occurs prior tobefore December 31 in the first anniversary ofyear the grant is awarded, a pro-rata portion of the grant will vest pursuant to the normal vesting schedule.

 

- RSUs -

RSUs: If termination occurs on or after the first anniversaryDecember 31 of the year the grant is awarded, all of the award will be distributed three years from grant date. If termination occurs prior tobefore December 31 in the first anniversary ofyear the grant is awarded, a pro-rata portion of the award will be distributed three years from grant date.

 

-

Performance Shares - Shares: If termination occurs on or after the first anniversaryDecember 31 of the year the grant is awarded, grantee will receive the entire award at the end of the performance period, calculated as if the grantee had remained employed throughout the entire performance period and based on actual performance. If termination occurs prior tobefore December 31 in the first anniversary ofyear the grant is awarded, the grantee will receive a pro-rata portion of the earned award at the end of the performance period.

period based on actual performance.

 

Please see the “Compensation Discussion and Analysis” section of this Proxy Statement for a detailed description of awards granted to the NEOs during 2015.2017.


 

BRUNSWICK CORPORATION - 2016 Proxy Statement36

2018 PROXY STATEMENT | 47
 
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Director
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Plan
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Proposal 42019
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Appendices

2015 Outstanding Equity Awards at Fiscal Year-End

2017 OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END

 

The table below provides information regarding each NEO’s outstanding equity awards as of December 31, 2015.2017. The equity awards in this table consist of stock-settled stock appreciation rightsStock Appreciation Rights (options), restricted stock unitsRestricted Stock Units, and performance shares. Performance Shares.

                                  
  Option Awards(1) Stock Awards(2)
Name Grant
Date
 Number of
Securities
Underlying
Unexercised
Options
Exercisable
  Number of
Securities
Underlying
Unexercised
Options
Unexercisable
 Equity
Incentive
Plan Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options
 Option
Exercise
Price
 Option
Expiration
Date
 Number
of Shares
or Units
of Stock
Held That
Have Not
Vested(3)
  Market Value
of Shares or
Units of Stock
Held That
Have Not
Vested
  Equity
Incentive
Plan Awards:
Number of
Unearned
Shares,
Units or
Other
Rights That
Have Not
Vested(4)(5)(6)
  Equity
Incentive
Plan Awards:
Market or
Payout Value
of Unearned
Shares, Units
or Other
Rights That
Have Not
Vested
Dustan E. 2/9/2010  563,000   -   $11.08  2/9/2020           
McCoy 2/8/2011  254,000   -   $21.52  2/8/2021           
  2/14/2012  75,600   25,200   $23.79  2/14/2022           
  2/4/2013                     94,934  $4,795,137
  2/3/2014                     62,766  $3,170,311
  2/11/2015                     57,900  $2,924,529
Mark D. 2/9/2009  35,000   -   $3.71  2/9/2019           
Schwabero 5/12/2009  65,000   -   $5.86  5/12/2019           
  2/9/2010  62,000   -   $11.08  2/9/2020           
  2/8/2011  28,000   -   $21.52  2/8/2021           
  2/14/2012  9,975   3,325   $23.79  2/14/2022           
  2/4/2013                       17,400  $878,874
  2/3/2014                       10,791  $545,053
  5/6/2014                       6,831  $345,034
  2/11/2015                       22,300  $1,126,373
William L. 2/14/2006  5,000   -   $39.15  2/14/2016           
Metzger 2/13/2007  8,000   -   $33.00  2/13/2017           
  2/28/2008  25,000   -   $17.06  2/28/2018           
  2/9/2009  13,125   -   $3.71  2/9/2019           
  5/12/2009  35,000   -   $5.86  5/12/2019           
  2/9/2010  45,000   -   $11.08  2/9/2020           
  2/8/2011  23,000   -   $21.52  2/8/2021           
  2/14/2012  6,600   2,200   $23.79  2/14/2022           
  2/4/2013                       17,400  $878,874
  2/3/2014                       10,791  $545,053
  2/11/2015                       8,900  $449,539
John C. 2/13/2007  5,000   -   $33.00  2/13/2017           
Pfeifer 2/9/2009  8,750   -   $3.71  2/9/2019           
  5/12/2009  12,500   -   $5.86  5/12/2019           
  2/9/2010  24,000   -   $11.08  2/9/2020           
  2/8/2011  15,750   -   $21.52  2/8/2021           
  2/14/2012  6,150   2,050   $23.79  2/14/2022           
  2/4/2013                 6,433  $324,931   3,712  $187,493
  2/3/2014                 5,511  $278,361   2,673  $135,013
  5/6/2014                 4,480  $226,285   4,257  $215,021
  2/11/2015                 9,396  $474,592   8,900  $449,539
B. Russell 2/14/2012  -   2,700   $23.79  2/14/2022             
Lockridge 2/4/2013                         8,352  $421,860
  2/3/2014                         5,148  $260,025
  2/11/2015                         4,500  $227,295
 Option/SAR Awards(1)Stock Awards(2)
          
          
Grant
Date
# of
Securities
Underlying
Unexercised
Options
Exercisable
# of Securities
Underlying
Unexercised
Options
Unexercisable
Equity
Incentive
Plan Awards:
# of
Securities
Underlying
Unexercised
Unearned
Options
Option
Exercise
Price
Option
Expiration
Date
# of
Shares
or Units
of Stock
Held
That
Have Not
Vested(3)
Market
Value
of Shares or
Units of
Stock
Held That
Have Not

Vested
Equity
Incentive
Plan
Awards:
Number of
Unearned
Shares,
Units, or
Other
Rights That
Have Not
Vested(4)(5)(6)
Equity
Incentive
Plan
Awards:
Market or
Payout
Value
of
Unearned
Shares,
Units,
or Other
Rights That
Have Not
Vested
MARK D. SCHWABERO, Chairman and Chief Executive Officer
2/9/0915,352$3.712/9/19
5/12/0946,200$5.865/12/19
2/9/1062,000$11.082/9/20
2/8/1128,000$21.522/8/21
2/14/1213,300$23.792/14/22
2/11/1524,031$1,326,99230,328$1,674,712
2/10/1658,334$3,221,20346,136$2,547,630
2/15/1741,686$2,301,90138,570$2,129,835
WILLIAM L. METZGER, Senior Vice President and Chief Financial Officer
5/12/0917,500$5.865/12/19
2/9/1045,000$11.082/9/20
2/8/1123,000$21.522/8/21
2/14/128,800$23.792/14/22
2/11/159,633$531,93412,104$668,383
2/10/1612,918$713,33210,270$567,109
2/15/178,339$460,4807,710$425,746
JAIME A. IRICK, Vice President and President — Fitness Division
1/19/1714,776$815,931
2/15/176,669$368,2626,170$340,707

2018 PROXY STATEMENT | 48
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
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Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

 Option/SAR Awards(1)Stock Awards(2)
          
          
Grant
Date
# of
Securities
Underlying
Unexercised
Options
Exercisable
# of Securities
Underlying
Unexercised
Options
Unexercisable
Equity
Incentive
Plan Awards:
# of
Securities
Underlying
Unexercised
Unearned
Options
Option
Exercise
Price
Option
Expiration
Date
# of
Shares
or Units
of Stock
Held
That
Have Not
Vested(3)
Market
Value
of Shares or
Units of
Stock
Held That
Have Not

Vested
Equity
Incentive
Plan
Awards:
Number of
Unearned
Shares,
Units, or
Other
Rights That
Have Not
Vested(4)(5)(6)
Equity
Incentive
Plan
Awards:
Market or
Payout
Value
of
Unearned
Shares,
Units,
or Other
Rights That
Have Not
Vested
JOHN C. PFEIFER, Vice President and President – Mercury Marine
2/9/1012,000$11.082/9/20
2/8/1115,750$21.522/8/21
2/14/128,200$23.792/14/22
2/11/159,633$531,93412,104$668,383
2/10/1612,918$713,33210,270$567,109
2/15/178,339$460,4807,710$425,746
HUW S. BOWER, Vice President and President — Brunswick Boat Group
2/11/15932$51,4651,224$67,589
2/10/161,425$78,6891,098$60,637
5/4/163,985$220,0523,160$174,495
2/15/176,669$368,2626,170$340,707

 

(1)Stock Appreciation Rights (SARs) vest at a rate of 25 percent per year over the first four years of the 10-year option term.
(2)The market value of shares or units of stock that have not vested reflects a stock price of $50.51,$55.22, the closing stock price on December 31, 2015.2017.
(3)RSU grants vest 100 percent on the third anniversary of the date of grant. Amounts include reinvested dividends.
(4)Represents the calculation of the 20132015 Performance Share awards which were subject to a three year-performance period. The final performance share awards with an additional modificationlevel was 136% of +20% based on currenttarget. Resulting TSR performance against the established peer group as describedfor the performance period did not result in the Compensation Discussion & Analysis. Mr. Pfeifer’s performance share grant does not include the TSR modifier as he was not part of the population to have this plan feature at the time of his grant.
(5)Represents the calculation of the 2014 performance share awards which may be subject to additional modification of +/- 20% based on TSR performance against the established peer group, as described in the Compensation Discussion & Analysis. Mr. Pfeifer’s performance share grant does not include the TSR modifier as he was not part of the population to have this plan feature at the time of his grant.award.
(6)(5)2015 performance share award grants2016 Performance Share awards are subject to a three-year performance period and may be subject to additional modification of +/- 20% based on TSR performance against the established peer group, as described in the Compensation Discussion & Analysis. The number of shares listed are based on performance through December 31, 2017. Mr. Bower’s February performance share grant does not include the TSR modifier as he was not eligible for this plan feature at the time of his grant. His May performance share grant includes the TSR modifier.
(6)2017 Performance Share award grants are subject to a three-year performance period and may be subject to additional modification.

 

BRUNSWICK CORPORATION - 2016 Proxy Statement37

2018 PROXY STATEMENT | 49
 
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

2015 Option Exercises and Stock Vested

2017 OPTION EXERCISES AND STOCK VESTED

 

  Option Awards Stock Awards(1)(2)(3)(4)(5)
Name Number of Shares
Acquired on Exercise
  Value Realized
on Exercise
  Number of Shares
Acquired on Vesting
  Value Realized
on Vesting
 
Dustan E. McCoy  -  $-   190,075  $10,105,498 
Mark D. Schwabero  -  $-   50,250  $2,617,519 
William L. Metzger  -  $-   26,293  $1,396,953 
John C. Pfeifer  5,000  $78,600   9,432  $531,870 
B. Russell Lockridge  9,700  $303,786   16,766  $893,355 
 Options AwardsStock Awards(1)(2)(3)(4)
     
     
NameNumber of Shares
Acquired on Exercise
Value Realized
on Exercise
Number of Shares
Acquired on Vesting
Value Realized
on Vesting
MARK D. SCHWABERO38,448$2,267,50536,337$2,184,336
WILLIAM L. METZGER30,625$1,730,00622,266$1,353,612
JAIME A. IRICK
JOHN C. PFEIFER33,250$1,624,89017,063$1,022,029
HUW S. BOWER1,788$108,853

 

(1)Includes the following number of vested PSUsPerformance Shares awarded on February 14, 2012,3, 2014, which vested on February 11, 2015,15, 2017, using a market price of $53.87$60.70 per share:(3)Includes the following number of vested Performance Shares awarded May 6, 2014, which vested on February 15, 2017, using a market price of $60.70 per share:

 

    McCoy   Schwabero   Metzger   Pfeifer   Lockridge 
 Shares  62,920   8,355   5,570   -   6,709 
 Value $3,389,500  $450,084  $300,056  $-  $361,414 
(2)Includes the following number of vested RSUs awarded on February 14, 2012, which vested on February 17, 2015, using a market price of $56.39 per share: 
    McCoy   Schwabero   Metzger   Pfeifer   Lockridge 
 Shares  -   -   -   9,432   - 
 Value $-  $-  $-  $531,870  $- 
(3)Includes the following number of vested RSUs awarded on February 3, 2014, which vested on February 3, 2015, (due to the application of the Rule of 70 or Age 62), using a market price of $54.94 per share: 
    McCoy   Schwabero   Metzger   Pfeifer   Lockridge 
 Shares  66,230   11,327   11,327   -   5,409 
 Value $3,638,676  $622,305  $622,305  $-  $297,170 
(4)Includes the following number of vested RSUs awarded on May 6, 2014, which vested on May 6, 2015, (due to the application of the Rule of 70 or Age 62), using a market price of $50.67 per share: 
    McCoy   Schwabero   Metzger   Pfeifer   Lockridge 
 Shares  -   7,128   -   -   - 
 Value $-  $361,176  $-  $-  $- 
(5)Includes the following number of vested RSUs awarded on February 11, 2015, which vested on December 31, 2015 (due to the application of the Rule of 70 or Age 62), using a market price of $50.51 per share: 
    McCoy   Schwabero   Metzger   Pfeifer   Lockridge 
 Shares  60,925   23,440   9,396   -   4,648 
 Value $3,077,322  $1,183,954  $474,592  $-  $234,770 
 SCHWABEROMETZGERIRICKPFEIFERBOWER  SCHWABEROMETZGERIRICKPFEIFERBOWER
SHARES10,79110,7912,673 SHARES6,8314,257
VALUE$655,014$655,014$162,251 VALUE$414,642$258,400

(2)Includes the following number of vested RSUs awarded on February 3, 2014, which vestedon February 3, 2017, using a market price of $60.88 per share:(4)Includes the following number of vested RSUs awarded on May 6, 2014, which vested onMay 8, 2017, using a market price of $57.47 per share:

 SCHWABEROMETZGERIRICKPFEIFERBOWER  SCHWABEROMETZGERIRICKPFEIFERBOWER
SHARES11,47511,4755,5821,788 SHARES7,2404,551
VALUE$698,598$698,598$339,832$108,853 VALUE$416,083$261,546

 

2015 Pension Benefits

Name Plan Name Number of Years
Credited Service
  Present Value of
Accumulated Benefit
  Payment During
Last Fiscal Year
 
William L. Metzger Qualified Pension Plan  21.33  $0  $681,393 
  Supplemental Pension Plan  21.33  $512,911  $ 

Narrative to Pension Benefits Table2017 PENSION BENEFITS

 

The Brunswick Pension Plan for Selected Current and Former Employees

NamePlan NameNumber of Years Credited ServicePresent Value of Accumulated BenefitPayment During Last Fiscal Year
William L. MetzgerSupplemental Pension Plan21.33$610,526

NARRATIVE TO PENSION BENEFITS TABLE

 

In 2015, the Company established the Brunswick Pension Plan for Selected Current and Former Employees as a frozen pension plan to provide retirement benefits for certain participants, including Mr. Metzger, whose accrued benefits were transferred from the Brunswick Pension Plan for Salaried Employees. The Brunswick Pension Plan for Selected Current and Former Employees was subsequently terminated on February 28, 2015 and, as a result, Mr. Metzger received a lump sum distribution on December 2, 2015 in the amount of $681,393. The distribution to Mr. Metzger satisfies the plan’s liability in full and no further benefit is payable to Mr. Metzger as of that date. Therefore, the present value of accumulated benefits at December 31, 2015 is $0.

BRUNSWICK CORPORATION - 2016 Proxy Statement38

Supplemental Pension Plan

Plan: Effective December 31, 2009, the Company froze the Supplemental Pension Plan and ceased all benefit accruals. Participation thereafter in any supplemental pension plan has been through the Brunswick Restoration Plan.

 

The Supplemental Pension Plan ensures that employees with covered compensation or pension benefits above IRS qualified defined benefit plan limits receive the full amount of their intended pension benefits. Under the Supplemental Pension Plan, the Company pays,is described on a non-qualified basis, the difference between an employee’s earned defined benefit pension and that permissible by IRS qualified limits, and this amount is subject to the claims of creditors. The Supplemental Pension Plan provides a retirement benefit that is consistent with those who are not affected by the IRS compensation and benefit limits and reflects an individual’s full career and covered pay earned.page 41.

 

The formula for determining benefits under the Supplemental Pension Plan is the same formula used for the qualified pension plans, specifically a formula based upon age, years of participation in the plan up to 30 years, and the average of the three highest consecutive years’ earnings (salaries, annual BPP, and commissions, but excluding payouts under the Strategic Incentive Plan, which has been eliminated).

 

2018 PROXY STATEMENT | 50
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

2015 Non-Qualified Deferred Compensation

2017 NON-QUALIFIED DEFERRED COMPENSATION

 

RESTORATION PLAN
               
Name Executive
Contributions
in Last FY(1)
  Company
Contributions
in Last FY(2)
  Aggregate
Earnings
in Last FY(3)
 Aggregate
Withdrawals/
Distributions
  Aggregate
Balance
at Last FYE(4)
Dustan E. McCoy $135,650  $269,920  $(27,561) $-  $5,771,027
Mark D. Schwabero $70,874  $109,534  $(55,401) $-  $4,542,080
William L. Metzger $40,775  $75,170  $(1,818) $-  $509,031
John C. Pfeifer $29,221  $53,469  $(8,942) $-  $993,445
B. Russell Lockridge $32,031  $62,555  $(5,731) $-  $3,971,079
                    
2005 ELECTIVE DEFERRED INCENTIVE COMPENSATION PLAN     
                    
Name  Executive
Contributions
in Last FY(1)
   Company
Contributions
in Last FY(2)
  Aggregate
Earnings
in Last FY(3)
  Aggregate
Withdrawals/
Distributions
   Aggregate
Balance
at Last FYE(4)
Dustan E. McCoy $-  $-  $(7,396) $-  $871,373
Mark D. Schwabero $-  $-  $(9,702) $-  $623,250
William L. Metzger $-  $-  $-  $-  $-
John C. Pfeifer $-  $-  $(1,451) $-  $125,318
B. Russell Lockridge $-  $-  $(1,458) $-  $1,083,021
                    
2005 AUTOMATIC DEFERRED COMPENSATION PLAN     
                    
Name  Executive
Contributions
in Last FY(5)
   Company
Contributions
in Last FY(2)
  Aggregate
Earnings
in Last FY(3)
  Aggregate
Withdrawals/
Distributions
   Aggregate
Balance
at Last FYE(4)
Dustan E. McCoy $6,212,319  $-  $(83,105) $-  $23,257,575
Mark D. Schwabero $99,012  $-  $(67,933) $-  $31,079
William L. Metzger $-  $-  $-  $-  $-
John C. Pfeifer $10,510  $-  $469  $-  $10,979
B. Russell Lockridge $-  $-  $-  $-  $-

RESTORATION PLAN

Name Executive
Contributions
in Last FY(1)
  Company
Contributions
in Last FY(2)
  Aggregate
Earnings
in Last FY
  Aggregate
Withdrawals/
Distributions
  Aggregate
Balance
at Last FYE(4)
 
MARK D. SCHWABERO $90,077  $163,790  $677,306    $6,001,193 
WILLIAM L. METZGER $34,189  $76,833  $127,678    $906,109 
JAIME A. IRICK $21,010  $16,808  $3,345    $41,162 
JOHN C. PFEIFER $69,027  $70,959  $187,064    $1,560,636 
HUW S. BOWER $45,997  $39,984  $35,839    $263,630 

2005 ELECTIVE DEFERRED INCENTIVE COMPENSATION PLAN

Name Executive
Contributions
in Last FY
 Company
Contributions
in Last FY
  Aggregate
Earnings
in Last FY
  Aggregate
Withdrawals/
Distributions
 Aggregate
Balance
at Last FYE(4)
MARK D. SCHWABERO     $89,785    $758,281 
WILLIAM L. METZGER          
JAIME A. IRICK          
JOHN C. PFEIFER     $6,937    $144,051 
HUW S. BOWER          

2005 AUTOMATIC DEFERRED COMPENSATION PLAN

Name Executive Contributions
in Last FY(5)
  Company Contributions
in Last FY
  Aggregate Earnings
in Last FY(3)
  Aggregate Withdrawals/ Distributions  Aggregate Balance
at Last FYE(4)
 
MARK D. SCHWABERO $1,717,717    ($128,083)   $2,747,307 
WILLIAM L. METZGER          
JAIME A. IRICK          
JOHN C. PFEIFER     $723    $12,321 
HUW S. BOWER          

(1)100 percent of the amount for each NEO in this column represents deferrals of salary and BPP and is reported in the “Salary” and “Non-Equity Incentive Plan Compensation” columns of the Summary Compensation Table.
(2)100 percent of the amount for each NEO in this column is reported in the “All Other Compensation” column of the Summary Compensation Table.
(3)Amounts in this column include above-market interest reported in the “Change in Pension Value and Non-Qualified Deferred Compensation Earnings” column of the Summary Compensation Table.
(4)The following amounts were previously reported as compensation to the NEOs in past Summary Compensation Tables. These amounts consist of Executive and Company Contributions and above-market interest as follows:

 

   McCoy  Schwabero  Metzger  Pfeifer  Lockridge 
  $6,168,704  $328,706  $159,937  $67,162  $182,562 
SCHWABERO METZGER IRICK PFEIFER BOWER
$1,157,463  $250,399    $230,139  $57,533 

 

(5)The amountsamount for Mr. McCoy and Mr. Schwabero in this column representrepresents deferrals of RSUs and Performance Shares granted on February 14, 2012,3, 2014 and distributable on February 17, 20153, 2017 and February 11, 2015,15, 2017, respectively, and deferrals of RSUs and Performance Shares granted on May 6, 2014 and distributable on May 8, 2017 and February 15, 2017, respectively. The amount for Mr. Pfeifer represents a deferral from his 2014 BPP payment.

 

BRUNSWICK CORPORATION - 2016 Proxy Statement39

2018 PROXY STATEMENT | 51
 
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

Narrative to Non-Qualified Deferred Compensation Tables

NARRATIVE TO NON-QUALIFIED DEFERRED COMPENSATION TABLES

 

The Non-Qualified Deferred Compensation tables show amounts deferred in 20152017 under the Elective Deferred Incentive Compensation, Restoration (non-qualified plan to provide for contributions in excess of IRS limits), the Elective Deferred Incentive Compensation, and Automatic Deferred Compensation plans and includes previous deferrals.

Under the 2005 Elective Deferred Incentive Compensation Plan, participants were allowed to defer up to 100 percent of BPP awards in either cash or stock. The Company calculated the value of cash deferrals based on the rate of return of mutual funds selected by the participant. The investment options mirror those of the qualified 401(k) plan and participants manage fund elections in the same manner. The Company calculated the value of stock deferrals on the same basis as Brunswick Common Stock. In 2008, the Company suspended participation in the plan. Distributions under the 2005 Elective Deferred Incentive Compensation Plan will be made as soon as administratively practicable after the participant’s termination from the Company or in accordance with the participant’s stated elections.

 

Under the Restoration Plan, participants may defer up to 40 percent of their base salary and BPP awards. These deferrals are credited with earnings and losses based on the rate of return of mutual funds selected by the participant. The investment options and Company matching formula mirror those of the qualified 401(k) plan, which the participant manages in the same manner. Brunswick contributes to this plan according to the following formula:

 

One dollar for every dollar contributed by the employee, up to 3 percent of annual pay, and 50 cents for every dollar on the next 2 percent, plus an annual variable retirement contribution of up to 9 percent based on Company performance. Distributions under the Restoration Plan will be made as soon as administratively practicable after the six-month anniversary from the participant’s date of termination.

 

The rates of return in 2015 for each fund inUnder the 2005 Elective Deferred Incentive Compensation Plan, participants were allowed to defer up to 100 percent of BPP awards in either cash or stock. The Company calculated the value of cash deferrals based on the rate of return of mutual funds selected by the participant. The investment options mirror those of the qualified 401(k) plan and the Restoration Plan are indicatedparticipants manage fund elections in the following table:same manner. The Company calculated the value of stock deferrals on the same basis as Brunswick Common Stock. In 2008, the Company suspended participation in the plan. Distributions under the 2005 Elective Deferred Incentive Compensation Plan will be made as soon as administratively practicable after the participant’s termination from the Company or in accordance with the participant’s stated elections.

FundRate of Return
Brunswick ESOP Co Stock-0.86%
Extended Mkt Index Inst-3.24%
Inst. Index Fund Inst1.37%
MainStay Large Cap Growth R66.25%
Prime Money Mkt Fund Adm0.11%
Target Retirement Trust 2015 II-0.44%
Target Retirement Trust 2025 II-0.72%
Target Retirement Trust 2035 II-1.12%
Target Retirement Trust 2045 II-1.48%
Target Retirement Trust 2055 II-1.66%
Target Retirement Inc Trust II-0.13%
TCW Core Fixed-Income I0.03%
Templeton Instl Foreign Eq Ser Primary-2.67%
Total Intl Stock Ix Inst-4.24%
Total Bond Mkt Index Inst0.41%
Wells Fargo Advantage Common Stock I-1.65%
Windsor II Fund Adm-3.14%

 

Under the 2005 Automatic Deferred Compensation Plan, participants are required to defer certain compensation in excess of $1.5 million to protect the tax deductibility to the Company of such compensation under Section 162(m) of the Internal Revenue Code. For cash balances, deferred cash equivalent balances are credited with: (i) an interest rate equal to the greater of the prime rate at JP Morgan Chase plus two percent, or Brunswick’s short-term borrowing rate; or (ii) returns on securities selected by the executive. For amounts deferred in stock, the account is credited with the number of share units equal to the number of shares of Company stock as of the date on which the shares would otherwise have been paid.

Distributions of deferrals are made as soon as reasonably practicable after the six-month anniversary of the participant’s date of termination.

 

Other Potential Post-Employment PaymentsAs discussed on page 41, this plan has been amended to cease deferrals of compensation earned on or after January 1, 2018, except for incentive awards that were outstanding prior to such date.

The rates of return in 2017 for each fund in the Restoration Plan and 2005 Elective Deferred Incentive Compensation Plan are stated in the following table:

FundRate of Return
Brunswick ESOP Co Stock2.12%
Extended Mkt Index Inst18.12%
Federal Money Mkt Fund0.81%
Inst. Index Fund Inst21.82%
MainStay Large Cap Growth R633.05%
Retire Savings Trust III1.91%
Target Retirement Trust 2015 II11.59%
Target Retirement Trust 2020 II14.19%
Target Retirement Trust 2025 II16.04%
Target Retirement Trust 2030 II17.60%
Target Retirement Trust 2035 II19.18%
Target Retirement Trust 2040 II20.81%
Target Retirement Trust 2045 II21.51%
Target Retirement Trust 2050 II21.48%
Target Retirement Trust 2055 II21.49%
Target Retirement Trust 2060 II21.51%
Target Retirement Trust 2065 II12.4%
Target Retirement Inc Trust II8.60%
TCW Core Fxd Inc C Ins2.74%
TIFInterEqPrimary23.77%
Total Intl Stock Ix Inst27.55%
Total Bond Mkt Index Inst3.57%
Wells Fargo CommonSt Inst17.93%
Windsor II Fund Adm16.89%


 2018 PROXY STATEMENT | 52
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

OTHER POTENTIAL POST-EMPLOYMENT PAYMENTS

 

Brunswick has entered into severance and Change in Control agreements with each of the NEOs which are incorporated in the Terms and Conditions of Employment (Agreements). with each NEO.

 

Terms and Conditions of EmploymentTERMS AND CONDITIONS OF EMPLOYMENT

 

The Agreements confirm that employment is at will and outline the NEO’s roles and responsibilities and compensation, benefits, and eligibility for certain perquisites provided in exchange for their services. The Agreements also contain provisions regarding termination of employment and reflect a “double-trigger” Change in Control severance and equity provision (effective upon termination of employment by the Company following a Change in Control of the Company) for all NEOs, including the Chairman and Chief Executive Officer. The Agreements do not contain provisions for voluntary resignation, thus, Mr. McCoy received no additional payments or benefits as a result of his retirement in February 2016.CEO.

Change in Control and Severance

Each NEO is entitled to certain severance benefits in the event of a Change in Control (as defined below), if Brunswick terminates his employment

BRUNSWICK CORPORATION -2016 Proxy Statement40

for reasons other than for Cause (as defined below) or disability or if the executive terminates for Good Reason (as defined below):

Upon any Change in Control:
All equity awards held by the executive will become fully vested and, if applicable, immediately exercisable and will remain outstanding pursuant to their terms.
Qualifying termination within 24 months following a Change in Control:
Severance payment of three times the sum of: (i) annual salary; (ii) the larger of targeted annual award under BPP for the year of termination or the year in which the Change in Control occurs; and (iii) the Company’s 401(k) match, variable retirement contribution and other Company contributions made on his behalf to the Company’s tax-qualified and non-qualified defined contribution plans during the 12-month period prior to the date of termination; and
Other benefits (including the continuation of medical, dental, vision and prescription coverage) for up to 36 months.

 

The Company modified its equity vesting provision for 2016 equity grants such that they will be subject to double-trigger vesting. Therefore a termination must occur following a Change in Control in order for the equity awards to vest. This modification is to align with competitive best practice. Legacy award grants (prior to 2016) still have single-trigger vesting upon a Change in Control, but this will no longer apply in 2018 after the 2015 awards vest, as they were the last awards granted with single trigger vesting.

CHANGE IN CONTROL AND SEVERANCE

Each NEO is entitled to certain severance benefits in the event of a Change in Control (as defined below), if Brunswick terminates his/her employment for reasons other than for Cause (as defined below) or disability or if the executive terminates for Good Reason (as defined below):

Qualifying termination within 24 months following a Change in Control:
Severance payment of three times for Messrs. Schwabero, Metzger, and Pfeifer and two times for Messrs. Irick and Bower the sum of: (i) annual salary; (ii) the larger of targeted annual award under BPP for the year of termination or the year in which the Change in Control occurs; and (iii) the Company’s 401(k) match, variable retirement contribution, and other Company contributions made on his/her behalf to the Company’s tax-qualified and non-qualified defined contribution plans during the 12-month period prior to the date of termination;
All equity awards held by the executive will become fully vested and, if applicable, immediately exercisable and will remain outstanding pursuant to their terms; and
Other benefits (including the continuation of medical, dental, vision, and prescription coverage) for up to the length of the severance period.

The three (3) times severance calculation is a grandfathered practice and new officers to the Company are set at two (2) times severance calculation following a Change in Control.

 

Qualifying termination other than following a Change in Control:
  
For the Chairman and Chief Executive Officer,CEO, severance payment equal to two
times the sum of: (i) annual salary; (ii) the targeted annual award under BPP for the year of termination; and (iii) the Company’s 401(k) match, variable retirement contribution and other Company contributions made on hishis/her behalf to the Company’s tax-qualified and non-qualified defined contribution plans during the 12-month period prior to the date of termination;
  
For the other NEOs, severance payment equal to one and one half times the sum of: (i) annual salary; and (ii) the Company’s 401(k) match, variable retirement contribution, and other Company contributions made on hishis/her behalf to the Company’s tax-qualified and non-qualified defined contribution plans during the 12-month period prior to the date of termination. Any award under the BPP can be made at the CEO’s discretion;
  
Other benefits (including the continuation of medical, dental, vision, and prescription coverage) for up to 24 months for the Chairman and Chief Executive OfficerCEO and up to 18 months for other NEOs; and,
  
All equity awards held by the executive vest according to the terms and conditions of the underlying plans.

 

In addition to the payments described above, in each scenario, the NEO would be entitled to receive any annual BPP award earned for the preceding year that had not yet been paid at the time of termination as well as outplacement services.

 

In 2012, the Companywe eliminated the practice of providing indemnification or any “gross-up” of taxes imposed by Section 4999 of the Internal Revenue Code on “excess parachute payments” (as defined in Section 280G of the Internal Revenue Code). As a result, all executives at Brunswick who have an Agreement, including each NEO, are no longer entitled to a gross-up for any excise tax imposed on “excess parachute payments.” Instead, such executives will either be required to pay the excise tax or have their payments reduced if it would be more favorable to them on an after-tax basis.

 

Brunswick may terminate the Agreements upon six months’ notice, except that after a Change in Control, Brunswick may not terminate the Agreements until the second anniversary of the Change in Control.

 

The Agreements contain non-competition and non-solicitation restrictive covenants effective during the two-year period following termination of employment for the Chief Executive Officer,CEO, and for 18 months following termination for all other NEOs, and non-disclosure and non-disparagement restrictive covenants effective at all times. Upon termination following a Change in Control, the non-competition and non-solicitation restrictive covenants are not applicable. In the event of a violation of the restrictive covenants, the Companywe may recover any severance payments received by the executive and any gain realized as a result of the exercise or vesting of equity awards beginning 12 months prior to termination and ending on the date that the Company makes full recovery of such payments. The terms of the Agreements


2018 PROXY STATEMENT | 53
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

require the NEOs to execute a general release.

Severance benefits are not available for those individuals terminating due to death, long-term disability, or for Cause.

 

Termination for “Cause” means the NEO’s:

 

Conviction of a crime, including by a plea of guilty or nolo contendere, involving theft, fraud, perjury, or moral turpitude;
  
Intentional or grossly negligent disclosure of confidential or trade secret information of the Company or a related company to anyone not entitled to such information;
  
Willful omission or dereliction of any statutory or common law duty of loyalty to the Company or a related company;
  
Willful and material violation of the Company’s Code of Conduct or any other written Company policy; or
  
Repeated failure to carry out the material components of the executive’s duties despite specific written notice to do so by the Chief Executive Officer,CEO other than any such failure as a result of incapacity due to physical or mental illness.

 

“Good Reason” means any of the following without the NEO’s express written consent:

 

Material breach of provisions of the Agreement;
  
Failure to provide benefits generally provided to similarly-situated senior executives;
  
Reduction in authority or responsibility;
Reduction in compensation not applicable to similarly-situated senior executives;
  
Relocation beyond a reasonable commuting distance; or
  
Following a Change in Control, failure to obtain a satisfactory agreement from any successor to assume and agree to abide by employment agreement terms.

 

The Good Reason provision protects executives from being effectively demoted or having their pay reduced in an effort to force them to quit.

 

The definition of Change in Control includes: (i) the acquisition of 25 percent or more of the outstanding voting stock of Brunswick by any person other than an employee benefit plan of Brunswick; (ii) the failure of the incumbent Board of Directors to constitute a majority of Brunswick’s Board, excluding new directors who (a) are approved by a vote of at least 50 percent of the members of the incumbent Board and (b) did not join the Board following a contested election of directors; (iii) a merger of Brunswick with another corporation, other than a merger in which Brunswick’s shareholders receive at least 60 percent of the voting stock outstanding after the merger or a merger effected to implement a recapitalization of Brunswick in which no person acquires more than 25 percent of Brunswick’s voting stock and the Board is comprised of a majority incumbent directors; or (iv) a complete liquidation or dissolution of Brunswick.


 

BRUNSWICK CORPORATION -2016 Proxy Statement41

Payment Obligations under Termination ScenariosPAYMENT OBLIGATIONS UNDER TERMINATION SCENARIOS

 

The following tables indicate the Company’sshow our estimated payment obligations resulting from effective termination before and after a Change in Control, using December 31, 20152017 as the hypothetical termination date.

 

INVOLUNTARY TERMINATION OTHER THAN FOR DEATH, DISABILITY, OR CAUSE

 

Name Severance(1)  Welfare Benefits(2)  Total  BPP(3)
Dustan E. McCoy(6) $6,092,240  $45,913  $6,138,154  $-
Mark D. Schwabero $1,328,601  $37,802  $1,366,403  $750,000
William L. Metzger $909,555  $44,664  $954,219  $505,000
John C. Pfeifer $832,004  $44,664  $876,668  $380,000
B. Russell Lockridge $763,132  $43,655  $806,787  $420,000
Name Severance(1) Welfare Benefits(2) Total BPP(3)
MARK D. SCHWABERO $5,105,980 $41,781 $5,147,762  
WILLIAM L. METZGER $950,299 $49,864 $1,000,163 $530,000 
JAIME A. IRICK $737,712 $22,229 $759,941 $380,000 
JOHN C. PFEIFER $896,488 $49,864 $946,352 $400,000 
HUW S. BOWER $757,626 $36,678 $794,304 $326,250 

 

TERMINATION FOLLOWING A CHANGE IN CONTROL

 

Name Severance(4)  Welfare Benefits(2)  Long-Term
Incentives(5)
  Total
Dustan E. McCoy(6) $9,138,360  $42,620  $191,088  $9,372,068
Mark D. Schwabero $4,296,660  $58,103  $68,693  $4,423,457
William L. Metzger $2,706,214  $71,829  $30,261  $2,808,304
John C. Pfeifer $2,804,008  $71,829  $364,511  $3,240,347
B. Russell Lockridge $2,786,264  $69,811  $14,975  $2,871,049
Name Severance(4) Welfare Benefits(2) Long-Term Incentives(5) Total
MARK D. SCHWABERO $7,658,971 $48,563 $6,739,270 $14,446,804 
WILLIAM L. METZGER $2,869,662 $82,227 $1,667,627 $4,619,516 
JAIME A. IRICK $1,743,616 $26,957 $683,897 $2,454,470 
JOHN C. PFEIFER $2,634,337 $82,227 $1,885,404 $4,601,968 
HUW S. BOWER $2,494,002 $46,268 $861,501 $3,401,771 

(1)Amounts in this column represent severance payments equal to two times the sum of salary, BPP, and defined contribution plan contributions for Mr. McCoySchwabero and one and one-half times the salary and defined contribution plan contributions for the other NEOs.
(2)Amounts in this column represent the estimated present value of Company-provided outplacement services and continuation of benefits provided during the severance period, based on current COBRA rates.
(3)Amounts in this column represent full payment of BPP. Per footnote 1, the severance column includes the BPP for Mr. Schwabero as it is guaranteed per his agreement. For NEOs other than Mr. McCoy,Schwabero, payment of the BPP upon a termination preceding a Change in Control is at the discretion of the Chairman and Chief Executive Officer.CEO.
(4)Amounts in this column represent severance payments equal to three times for Messrs. Schwabero, Metzger, and Pfeifer and two times for Messrs. Irick and Bower, the sum of the NEO’s salary, BPP, and defined contribution plan contributions. Payments are reduced, where appropriate, in order to avoid excise taxes under Section 280G of the Internal Revenue Code so as to place the NEO in a “best after tax” situation.
(5)Amounts in this column reflect the long-term incentive awards for which vesting would be accelerated following termination upon a Change in Control in accordance with the NEOs’ Agreements.
(6)Tables reflect termination scenarios asterms and conditions of December 31, 2015. Mr. McCoy retired as Chairman and Chief Executive Officer and Mr. Schwabero was appointed Chairman and Chief Executive Officer, both effective February 11, 2016.the awards.

 

BRUNSWICK CORPORATION -2016 Proxy Statement42

2018 PROXY STATEMENT | 54
 
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

PROPOSAL NO. 2:3: ADVISORY VOTE TO APPROVE THE COMPENSATION OF OUR NAMED EXECUTIVE COMPENSATIONOFFICERS

 

What am I voting on? Shareholders are being asked to approve the compensation of our NEOs on an advisory basis.

Voting Recommendation: Your Board of Directors recommends a vote FOR the approval of compensation of our Named Executive Officers.

Pursuant to Section 14A of the Securities Exchange Act of 1934, as amended, the CompanyBoard of Directors seeks your advisory vote to approve itsour compensation programs for its named executive officersour Named Executive Officers (commonly referred to as a “say-on-pay vote”). We encourage shareholders to review the Compensation Discussion and Analysis on pages 2432 to 4254 of this Proxy Statement. The Company asksWe ask that you approve the compensation of our named executive officersNEOs as disclosed in the Compensation Discussion and Analysis and the accompanying tables contained in this Proxy Statement. Because this vote is advisory in nature, it will not be binding on the Board of Directors, the Human Resources and Compensation Committee, (Compensation Committee) or the Company; however, the Board and the Compensation Committee will review the voting results and carefully consider the outcome of the vote when making future decisions regarding executive compensation.

 

 

Consistent with the direction of our shareholders at our 2017 annual meeting, the say-on-pay vote iswill continue to be held on an annual basis until the next non-binding shareholder vote on the frequency with which the say-on-pay vote should be held, which will occur atbasis. At our 2017 annual meeting. At its 2015 annual meeting, the Companywe received overwhelming shareholder approval on the “say on pay” proposal (97.13(93.75 percent of votes were cast for the proposal). The Company wasWe were pleased with this significant vote of confidence of itsin our pay practices and made no direct changes to itsour compensation programs as a result of this vote.

 

The Company hasWe have a long-standing tradition of delivering financial results for our shareholders and our customers and aligning pay with those results. We believe we are a market leader in the marine and fitness industries, with business locations in more than 25many countries. Our executive team continues to successfully execute its growth plan, ending the 2015 fiscal year with $668.8 million of cash and marketable securities, generating strong free cash flow and demonstrating outstanding operating leverage.

The Company hasWe have designed itsour executive compensation programs to drive these strong financial results and to attract, reward, and retain a highly experienced, successful senior management team to achieve our corporate objectives and increase shareholder value. We believe these programs are structured in the best manner possible to support our Company and our business objectives and we believe that they strike an appropriate balance between implementing responsible, measured pay practices and providing effective incentives designed to encourage our executives to perform at their best. This balance is illustrated by the following factors, which we urge you to consider:

 

A significant part of our executive compensation is structured as performance-based incentives. Our compensation programs are substantially linked to our key business objectives, so that if the value we deliver to our shareholders declines, so does the compensation we deliver to our executives.
  
We have multiple-year award and payout cycles which serve as a retention tool.
  
We respond to economic conditions appropriately, such as reducing and/or limiting bonuses of the named executive officersNEOs in years when performance is not strong.
  
We monitor the executive compensation programs and pay levels of companies of similar size and industry to ensure that our compensation programs are comparable to, and competitive with, our peer group and general market practices.
  
The Board, the Compensation Committee, our Chairman and Chief Executive Officer, and our Vice President and Chief Human Resources Officer engage in a rigorous talent review process annually to address succession planning and executive development for our Chief Executive Officer and other key executives.

Accordingly, we ask our shareholders to vote “FOR” the following resolution:

 

Accordingly, we ask our shareholders to vote “FOR” the following resolution:

“RESOLVED,that the Company’s shareholders approve, on an advisory basis, the compensation of the named executive officers,Named Executive Officers, as disclosed in this Proxy Statement pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the Compensation Discussion and Analysis, the Summary Compensation Table, and the other related tables and disclosure in this Proxy Statement.”

 

Your Board of Directors recommends a vote FOR the approval of the compensation of our named executive officers.

BRUNSWICK CORPORATION -2016 Proxy Statement43

2018 PROXY STATEMENT | 55
 

DIRECTOR COMPENSATION

2015 Director Compensation Table

The table below summarizes the compensation paid by the Company to non-employee directors for the fiscal year ended December 31, 2015.

Director(1) Fees Earned
or Paid in Cash(2)
  Stock
Awards(3)
  All Other
Compensation(4)
  Total
Nolan D. Archibald $90,000  $129,982  $30,000  $249,982
Nancy E. Cooper  90,000   138,747   30,000   258,747
David C. Everitt  90,000   127,447   30,000   247,447
Manuel A. Fernandez  90,047   205,574   30,000   325,621
David V. Singer  90,047   150,513   25,971   266,531
Ralph C. Stayer  90,047   155,512   24,115   269,674
Jane L. Warner  56,012   90,957   30,000   176,969
J. Steven Whisler  90,000   142,482   30,000   262,482
Roger J. Wood  90,047   155,512   30,000   275,559
Lawrence A. Zimmerman(5)  46,750   72,696   -   119,446
(1)Proxy SummaryDustan E. McCoy, the Company’s former Chairman and Chief OverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive Officer, and Mark D. Schwabero, the Company’s Chairman and Chief Executive Officer, are not included in this table as they are employees of the Company and received no additional compensation for their service as directors in 2015. The compensation received by Mr. McCoy and Mr. Schwabero as employees of the Company is shown in the Summary
Compensation Table.
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices
(2)Amounts in this column reflect the 2015 annual cash fees earned by each non-employee director. Mr. Fernandez, Mr. Singer, Mr. Stayer, Ms. Warner and Mr. Wood elected to receive the 2015 annual cash fees in the form of deferred Common Stock, with a 20 percent premium.
(3)This column represents the dollar amount recognized for financial statement reporting purposes with respect to the 2015 fiscal year in accordance with FASB ASC Topic 718. Amounts in this column represent the portion of fees required to be paid to directors in the form of Common Stock, as well as the 20 percent premium that is received by those directors who elected to receive the cash portion of their fees in the form of deferred Common Stock. For assumptions used in the valuation of such awards, see Note 18 to the financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2015. The grant date fair value of awards in this column is as follows:

 

Name Grant Date Fair
Values of Shares of
Common Stock
  Grant Date Fair Values of Shares
Attributable to 20% Premium
Applied to Deferral of Fees
Nolan D. Archibald $129,982  $-
Nancy E. Cooper  138,747   -
David C. Everitt  127,447   -
Manuel A. Fernandez  187,532   18,042
David V. Singer  132,471   18,042
Ralph C. Stayer  137,470   18,042
Jane L. Warner  78,872   12,085
J. Steven Whisler  142,482   -
Roger J. Wood  137,470   18,042
Lawrence A. Zimmerman  72,696   -

BRUNSWICK CORPORATION -2016 Proxy Statement44

The following table sets forth the aggregate number of outstanding stock awards held by each non-employee director as of December 31, 2015:

NameAggregate Number of Stock Awards
Outstanding at December 31, 2015
Nolan D. Archibald4,366
Nancy E. Cooper-
David C. Everitt-
Manuel A. Fernandez4,366
David V. Singer-
Ralph C. Stayer4,366
Jane L. Warner-
J. Steven Whisler1,594
Roger J. Wood-
Lawrence A. Zimmerman-
(4)The amounts shown in this column include the cost to Brunswick of products provided during the Company’s fiscal year ended December 31, 2015.
(5)Mr. Zimmerman retired from the Board effective May 6, 2015.

Narrative to Director Compensation Table

Annual Fees and Deferred Stock Awards.Non-employee directors are entitled to an annual fee of $210,000, with $90,000 payable in cash and $120,000 payable in Brunswick Common Stock. The Lead Independent Director is entitled to an additional annual fee of $50,000, the director who chairs the Audit Committee is entitled to an additional annual fee of $20,000, and the other members of the Audit Committee are each entitled to an additional annual fee of $10,000, due to the increased time commitment required of those directors. The director who chairs the Compensation Committee is also entitled to an additional annual fee of $15,000. The directors who chair the Finance and the Nominating and Corporate Governance Committees are entitled to an additional annual fee of $10,000 each. Each director who serves on more than one Committee is entitled to an additional annual fee of $7,500, except in the event that a director is already receiving an additional fee for both committees on which they serve. All additional annual fees are payable in Brunswick Common Stock. For the portion of each director’s total annual fee paid in Brunswick Common Stock, the number of shares is determined by the closing price of Brunswick Common Stock on the date of the award and is reported in the “Stock Awards” column of the Director Compensation Table. The receipt of these shares may be deferred until a director retires from the Board. Each director may elect to have the cash portion of the annual fee paid as follows:

In cash;
In Brunswick Common Stock distributed currently; or
In deferred Brunswick Common Stock with a 20 percent premium.

For directors who elect to receive deferred Brunswick Common Stock, the number of shares to be received upon retirement is determined by multiplying the cash amount by 1.2, then dividing that amount by the closing price of Brunswick Common Stock on the date of the award.

Share Ownership Guidelines. As set forth in the Company’s Principles and Practices, within five years after the date on which a director first became a director, and thereafter for so long as each director is a director of the Company, each director is required to own Common Stock and deferred stock units of the Company equal to five times the amount of the director’s annual cash retainer. Once having met this threshold, if a director falls below the threshold as a result of a decline in the Company’s stock price, the director shall have a two-year period within which to once again achieve the threshold. The Company will calculate compliance with these guidelines annually, using the average Brunswick stock price for the prior calendar year. As of December 31, 2015, all directors were in compliance with the share ownership requirements.

Brunswick Product Program. Directors are encouraged to use Brunswick products to enhance their understanding and appreciation of Brunswick’s business. Directors receive an annual allowance of up to $30,000 which may be applied to: (i) purchase Brunswick products at discounted rates; and/or (ii) fund expenses incurred with regard to the ownership of such products. The value of the products is included in the directors’ taxable income. Directors may also purchase additional Brunswick products at their own expense, at discounted rates, above and beyond the allowance.

BRUNSWICK CORPORATION -2016 Proxy Statement45

EQUITY COMPENSATION PLAN INFORMATION

 

The following table provides information as of December 31, 2015,2017, regarding Brunswick Common Stock that may be issued under equity compensation plans currently maintained by Brunswick.

 

  A B C
      Number of securities remaining
      available for future issuance
Plan CategoryNumber of securities to be
issued
Weighted-average exercise priceunder equity compensation plans
upon the exercise of
outstanding options, warrants,
and rights
Weighted-average exercise
price of outstanding options,
warrants, and rights
Number of securities remaining
available for future issuance
under equity compensation
plans

(excluding securities reflected in
Plan Category column (A)) options, warrants and rightsand rightscolumn (a))
Equity compensation plans approved by security holdersEQUITY
COMPENSATION

PLANS APPROVED

BY SECURITY

HOLDERS(1)
 3,710,8551,829,755(2)(3) $15.7814.40(4) 5,280,1075,415,791(5)
Equity compensation plans not approved by security holdersEQUITY
COMPENSATION
PLANS NOT
APPROVED
BY SECURITY
HOLDERS
 - - -

(1)TheOur shareholders have approved the 2014 Stock Incentive Plan has been approved by Brunswick shareholders.Plan.
(2)Includes 2,233,894594,342 shares of Brunswick Common Stock subject to outstanding stock appreciation rights, 293,77653,175 shares of Brunswick Common Stock subject to deferred obligations to issue shares of Brunswick Common Stock, 423,771410,225 shares of performance sharePerformance Share obligations to issue shares of Brunswick Common Stock, and 759,414772,013 shares of restricted stock obligations to issue shares of Brunswick Common Stock.
(3)Shares represented by performancePerformance Share awards may be adjusted depending on performance.
(4)The weighted average exercise price was calculated solely with respect to outstanding stock appreciation rights. Deferred and restricted stock obligations to issue shares of Brunswick Common Stock have been disregarded for purposes of calculating the weighted average exercise price because no exercise price is associated with those obligations.
(5)All shares are available under the 2014 Stock Incentive Plan.

 

BRUNSWICK CORPORATION -2016 Proxy Statement46

 2018 PROXY STATEMENT | 56
 
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

AUDIT-RELATED MATTERS

AUDIT COMMITTEE REPORT

The following is the Audit Committee report with respect to Brunswick’s audited financial statements for the fiscal year ended December 31, 2017.

Overview of Audit Committee Function: The Audit Committee, composed of independent directors who are all Audit Committee financial experts under SEC rules, oversees Brunswick’s financial reporting process. Management has the primary responsibility for the financial statements and the reporting process, including the system of internal controls.

Audit Committee Charter: The Audit Committee operates pursuant to a written charter, a copy of which is available on Brunswick’s website, www.brunswick.com.

Independence of Audit Committee Members: The Board of Directors has determined that all members of the Audit Committee are independent, within the meaning of the New York Stock Exchange Listed Company Manual.

Review with Management: The Audit Committee has reviewed and discussed Brunswick’s audited financial statements with management.

Review and Discussions with Independent Auditors: The Audit Committee is responsible for the appointment, termination, compensation, and oversight of Brunswick’s independent auditors. Deloitte and Touche, LLP is Brunswick’s independent registered public accounting firm for the fiscal year ended December 31, 2017 and has served in that capacity since 2014. The Audit Committee has discussed with Deloitte, which is responsible for expressing an opinion on the conformity of Brunswick’s audited financial statements with generally accepted accounting principles and on the effectiveness of Brunswick’s internal control over financial reporting, the matters required to be discussed by the applicable requirements of the Public Company Accounting Oversight Board and the SEC, and other professional standards and regulatory requirements currently in effect.

The Audit Committee has also received the written disclosures from Deloitte required by the applicable requirements of the Public Company Accounting Oversight Board regarding Deloitte’s communications with the Audit Committee concerning independence, and has discussed with Deloitte its independence from Brunswick. The Audit Committee has also reviewed the non-audit services Deloitte provided and has considered whether the provision of those services was compatible with maintaining Deloitte’s independence.

Conclusion: Based on the review and discussions referred to above, the Audit Committee recommended to Brunswick’s Board of Directors that the audited financial statements be included in Brunswick’s Annual Report on Form 10-K for the fiscal year ended December 31, 2017, for filing with the SEC.

  AUDIT COMMITTEE     
NANCY E.
COOPER (C)
DAVID V.
SINGER
RALPH C.
STAYER
ROGER J.
WOOD

FEES INCURRED FOR DELOITTE SERVICES

Brunswick incurred the following fees for services rendered by Deloitte, our current independent registered public accounting firm, during the fiscal years ended December 31, 2016 and 2017:

 20162017
AUDIT FEES(1) $4,099,015  $4,678,684 
AUDIT-RELATED FEES(2) $92,494  $523,756 
TAX FEES(3) $1,546,714  $880,489 

(1)Audit Fees: Professional services rendered for the audit of our annual financial statements included in our Annual Reports on Form 10-K, reviews of the financial statements included in our Quarterly Reports on Form 10-Q, accounting and financial reporting consultations, and statutory audits.
(2)Audit-Related Fees: Includes accounting advisory services and M&A support.
(3)Tax Fees: Includes tax compliance and consulting services.

APPROVAL OF SERVICES PROVIDED BY INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Audit Committee is responsible for pre-approving all audit and non-audit services that our independent registered public accounting firm performs; accordingly, the Committee pre-approved Deloitte’s services in 2016 and 2017. The Audit Committee has adopted a two-tiered approach for pre-approving fees. Each year it approves an overall budget for specified audit and non-audit services, after which the Audit Committee must pre-approve either: (i) any proposed specified service that would result in total fees exceeding the budget; or (ii) any proposed service not specified in the budget.


 2018 PROXY STATEMENT | 57
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

PROPOSAL NO. 3: 4:RATIFICATION OF THE APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE FISCAL YEAR ENDING DECEMBER 31, 20162018

What am I voting on?Shareholders are being asked to approve the appointment of Deloitte as the independent registered accounting firm for Brunswick.

Voting Recommendation: Your Board of Directors and the Audit Committee recommend a vote FOR the approval and ratification of the appointment of Deloitte as the Company’s Independent Registered Public Accounting Firm for the fiscal year ending December 31, 2018.

 

The Audit Committee has appointed Deloitte & Touche LLP (Deloitte) as the independent registered public accounting firm for Brunswick and its subsidiaries for itsour fiscal year ending December 31, 2016.2018. Although the Companyit is not required to seek shareholder approval of this appointment, the Board of Directors has determined that, in keeping with the principles of sound corporate governance, the appointment will be submitted for ratification by the shareholders. The Board of Directors and the Audit Committee recommend that shareholders ratify the appointment of Deloitte as the independent registered accounting firm for Brunswick and its subsidiaries for the fiscal year ending December 31, 2016.2018. If our shareholders do not ratify the appointment, the Audit Committee will investigate the basis for the negative vote and will reconsider its appointment in light of the results of such investigation.

 

Representatives of Deloitte will be present at the Annual Meeting and will be afforded an opportunity to make a statement, if they desire to do so, and to respond to questions from shareholders.

 

20162018 will be the thirdfifth year that Deloitte will serve as the independent registered public accounting firm for Brunswick and its subsidiaries. The Audit Committee dismissed Ernst & Young LLP (EY) as the Company’s independent registered public accounting firm effective February 14, 2014, the date of the filing of Brunswick’s Annual Report on Form 10-K for the fiscal year ended December 31, 2013, and engaged Deloitte as the Company’s independent registered public accounting firm commencing with the audit for the fiscal year ending December 31, 2014.

 

During Brunswick’s fiscal years ended December 31, 2012 and 2013 and the period from December 31, 2013 through February 14, 2014, there were no disagreements between Brunswick and EY on any matter of accounting principle or practice, financial statement disclosure, or auditing scope or procedure which, if not resolved to EY’s satisfaction, would have caused it to make reference to the matter in conjunction with its report on Brunswick’s consolidated financial statements for the relevant year, and there were no reportable events as defined in Item 304(a)(1)(v) of Regulation S-K. EY’s audit reports on Brunswick’s consolidated financial statements for the fiscal year ended December 31, 2013 did not contain an adverse opinion or disclaimer of opinion, nor were they qualified or modified as to uncertainty, audit scope or accounting principles.

During Brunswick’s fiscal years ended December 31, 2014 and December 31, 2015, there were no disagreements between Brunswick and Deloitte on any matter of accounting principle or practice, financial statement disclosure, or auditing scope or procedure which, if not resolved to Deloitte’s satisfaction, would have caused it to make reference to the matter in conjunction with its report on Brunswick’s consolidated financial statements for the relevant years, and there were no reportable events as defined in Item 304(a)(1)(v) of Regulation S-K. Deloitte’s audit reports on Brunswick’s consolidated financial statements for the fiscal years ended December 31, 2014 and December 31, 2015 did not contain an adverse opinion or disclaimer of opinion, nor were they qualified or modified as to uncertainty, audit scope or accounting principles.

During Brunswick’s fiscal years ended December 31, 2012 and 2013, and the period from December 31, 2013 through February 14, 2014, neither Brunswick, nor anyone on behalf of Brunswick, consulted with Deloitte with respect to either (i) the application of accounting principles to a specified transaction, either completed or proposed, or the type of audit opinion that might be rendered on Brunswick’s consolidated financial statements, and no written report or oral advice was provided by Deloitte to Brunswick that Deloitte concluded was an important factor considered by Brunswick in reaching a decision as to the accounting, auditing, or financial reporting issue or (ii) any matter that was the subject of either a disagreement (as defined in Item 304(a)(1)(iv) of Regulation S-K) or a reportable event (as described in Item 304(a)(1)(v) of Regulation S-K).

Your Board of Directors and the Audit Committee recommend a vote FOR the approval and ratification of the appointment of Deloitte & Touche LLP as the Company’s Independent Registered Public Accounting Firm for the fiscal year ending December 31, 2016.

Fees Incurred for Services of Deloitte

Brunswick incurred the following fees for services rendered by Deloitte, Brunswick’s current independent registered public accounting firm, during the fiscal years ended December 31, 2014 and 2015:

Audit Fees: The aggregate fees billed to Brunswick for professional services rendered for the audit of Brunswick’s annual financial statements included in Brunswick’s Annual Reports on Form 10-K, reviews of the financial statements included in Brunswick’s related Quarterly Reports on Form 10-Q and accounting and financial reporting consultations were $3,950,336 in 2015 and $3,838,800 in 2014.

Audit-Related Fees: The aggregate fees billed to Brunswick for professional services rendered for audit-related activities were $198,777 in 2015 and $4,930 in 2014.

Tax Fees:The aggregate fees billed to Brunswick for tax-related services were $1,719,091 in 2015 and $689,493 in 2014. Such fees involved the following activities: tax compliance services and tax consulting services.

All Other Fees: There were no fees billed by Deloitte for fiscal years 2015 or 2014 for services other than those described in the preceding paragraphs. The Audit Committee pre-approved all of the services described above.

Approval of Services Provided by Independent Registered Public Accounting Firm

The Audit Committee is responsible for pre-approving all audit and non-audit services to be provided by Brunswick’s independent registered public accounting firm. The Audit Committee has adopted a two-tiered approach for granting such pre-approvals. Each year it approves an overall budget for specified audit and non-audit services, after which the Audit Committee must pre-approve either: (i) any proposed specified service that would result in total fees exceeding the budget; or (ii) any proposed service not specified in the budget.

BRUNSWICK CORPORATION -2016 Proxy Statement47

2018 PROXY STATEMENT | 58
 

REPORT OF THE AUDIT COMMITTEE

To the Shareholders of Brunswick Corporation:

The following is the report of the Audit Committee with respect to Brunswick’s audited financial statements for the fiscal year ended December 31, 2015.

Overview of Audit Committee Function

The Audit Committee oversees Brunswick’s financial reporting process. Management has the primary responsibility for the financial statements and the reporting process, including the systems of internal controls.

Audit Committee Charter

The Audit Committee operates pursuant to a written charter, a copy of which is available at Brunswick’s website,www.brunswick.com.

Independence of Audit Committee Members

The Board of Directors has determined that all members of the Audit Committee are independent, within the meaning of the New York Stock Exchange Listed Company Manual.

Review with Management

The Audit Committee has reviewed and discussed Brunswick’s audited financial statements with management.

Review and Discussions with Independent Auditors

The Audit Committee has discussed with Deloitte & Touche LLP (“Deloitte”), Brunswick’s independent registered public accounting firm for the fiscal year ended December 31, 2015, who is responsible for expressing an opinion on the conformity of those audited financial statements with generally accepted accounting principles, the matters required to be discussed by Auditing Standard No. 16, “Communication with Audit Committees,” as amended, and other professional standards and regulatory requirements currently in effect. Statement on Auditing Standards No. 16 requires an auditor to discuss with the audit committee, among other things, the auditor’s judgments about the quality, not just the acceptability, of the accounting principles applied in the company’s financial reporting.

The Audit Committee has also received the written disclosures from Deloitte required by the applicable requirements of the Public Company Accounting Oversight Board regarding Deloitte’s communications with the Audit Committee concerning independence, and has discussed with Deloitte its independence from Brunswick. The Audit Committee has also reviewed the non-audit services provided by Deloitte and has considered whether the provision of those services was compatible with maintaining Deloitte’s independence.

Conclusion

Based on the review and discussions referred to above, the Audit Committee recommended to Brunswick’s Board of Directors that the audited financial statements be included in Brunswick’s Annual Report on Form 10-K for the fiscal year ended December 31, 2015, for filing with the Securities and Exchange Commission.

Submitted by the Members of the Audit Committee of the Board of Directors.

Nancy E. Cooper (Chair)
David V. Singer
Ralph C. Stayer
Roger J. Wood

Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

 

BRUNSWICK CORPORATION -2016 Proxy Statement48

SUBMISSION OF SHAREHOLDER PROPOSALS FOR 2017THE 2019 ANNUAL MEETING

 

In order to be considered for inclusion in Brunswick’s proxy materials for its 2017 annual meeting,our 2019 Annual Meeting, a shareholder proposal must be received at Brunswick’s principal executive offices at 126125 N. Field Court, Lake Forest,Riverwoods Blvd., Suite 500, Mettawa, Illinois 60045-481160045 (fax: 847.735.4433; e-mail corporate.secretary@brunswick.com) email: corporate.secretary@brunswick.com) by November 24, 2016.22, 2018.

Shareholders who intend to submit director nominees for inclusion in our proxy materials for the 2019 Annual Meeting must comply with the requirements of proxy access as set forth in our Amended By-Laws. The shareholder or group of shareholders who wish to submit director nominees pursuant to proxy access must deliver the required materials to Brunswick between October 23, 2018 and November 22, 2018.

 

In addition, a shareholder may wish to have a proposal presented at the 2017 annual meeting,2019 Annual Meeting (including director nominations), but not to have such proposal included in Brunswick’s proxy materials relating to that meeting. Brunswick’s By-lawsAmended By-Laws establish an advance notice procedure for shareholder proposals to be brought before an annual meeting of shareholders, including proposed nominations of persons for election to the Board.shareholders. Pursuant to the By-laws,Amended By-Laws, a shareholder proposal or nomination intended to be brought before the 2017 annual meeting2019 Annual Meeting must be delivered to Brunswick’s Secretary between January 4, 20172, 2019 and February 3, 2017.1, 2019.

 

Brunswick encourages you to vote on the matters that will be presented to Brunswick shareholders at the Annual Meeting. Please vote as soon as possible so that your shares will be represented.

 

By order of the Board of Directors,

 

 

 

Christopher F. Dekker
Secretary

Secretary
Lake Forest,Mettawa, Illinois


March 24, 201622, 2018

 

BRUNSWICK CORPORATION -2016 Proxy Statement49

 2018 PROXY STATEMENT | 59
 
Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

APPENDIX 1

 

Explore BrunswickPROPOSED AMENDMENTS TO OUR RESTATED CERTIFICATE OF INCORPORATION TO DECLASSIFY THE BOARD OF DIRECTORS

 

Scan these QR codesThe proposed amendments to the Company’s Restated Certificate of Incorporation would revise section (c) and (e) of ARTICLE Eleventh thereof as shown below (new language is indicated by bolded text, and deletions are indicated by strike-throughs).

ELEVENTH.

(c) The directors shall be divided into three classes: Class A, Class Band Class C. Such classes shall be as nearly equal in number as possible. The term of office of the initial Class A directors shall expire at the annual meeting of stockholders in 1988, the term of office of the initial Class B directors shall expire at the annual meeting of stockholders in 1987 and the term of office of the initial Class C directors shall expire at the annual meeting of stockholders in 1986, or thereafter in each case when their respective successors are elected and have qualified. At each annual election, the directors chosen to succeed those whose terms then expire shall be identified as being of the same class as the directors they succeed and shall be elected for a term. expiring at the third succeeding annual meeting or thereafter when their respective successors in each case are elected and have qualified. If the number of directors is changed, any increase or decrease in directors shall be apportioned among the classes so as to maintain all classes as nearly equal in number as possible and any individual director elected to any class shall hold office for a term which shall coincide with the term of such class.Effective as of the annual meeting of stockholders of the Corporation to be held in 2018, the successors of the directors whose terms expire at such meeting shall be elected for a smart deviceterm expiring at the annual meeting of stockholders of the Corporation to be held in 2021; at the annual meeting of stockholders of the Corporation to be held in 2019, the successors of the directors whose terms expire at such meeting shall be elected for a term expiring at the annual meeting of stockholders of the Corporation to be held in 2020; at the annual meeting of stockholders of the Corporation to be held in 2020, the successors of the directors whose terms expire at such meeting shall be elected for a term expiring at the annual meeting of stockholders of the Corporation to be held in 2021; and at each annual meeting of stockholders of the Corporation thereafter, the directors shall be elected for terms expiring at the next succeeding annual meeting of stockholders of the Corporation, with each director to hold office until his or useher successor shall have been duly elected and qualified or until the URLsearlier of such director’s earlier resignation, removal or death. Commencing with the annual meeting of stockholders of the Corporation to learnbe held in 2021, the Board of Directors will no longer be classified under Section 141(d) of the General Corporation Law of the State of Delaware and directors shall no longer be divided into classes.

(e) No director shall be removed from the Board of Directors by action of the stockholders of the Corporation during his appointed term other than for cause. Whenever the holders of any class or series of Preferred Stock are entitled to elect one or more about Brunswick:directors, the provisions of this section shall apply to the removal of such director or directors by such stockholders. [Reserved].

 

Read our online Annual Report

2018 PROXY STATEMENT | 60

Proxy SummaryOverviewProposal 1Corporate
Governance
Proposal 2Governance
Policies &
Practices
Director
Compensation
Executive
Compensation
Proposal 3Equity
Compensation
Plan
Audit-Related
Matters
Proposal 42019
Shareholder
Submissions
Appendices

APPENDIX 2*

 

http://www.brunswick.com/investors/publications-
and-filings/annualreports.php

FREE CASH FLOWYear Ended December 31, 2017
NET CASH PROVIDED BY OPERATING ACTIVITIES OF CONTINUING OPERATIONS$417.2
NET CASH PROVIDED BY (USED FOR):  
Visit our Investor Relations websiteCapital expenditures

http://www.brunswick.com/investors

  ($189.3)
Download our Investor Relations appProceeds from the sale of property, plant and equipment$8.3
Effect of exchange rate changes on cash and cash equivalents$6.9
FREE CASH FLOW$243.1

 

EARNINGS PER SHAREYear Ended December 31, 2017
DILUTED EARNINGS PER SHARE$2.08
PENSION SETTLEMENT CHARGE$0.69
RESTRUCTURING, EXIT, INTEGRATION, AND IMPAIRMENT CHARGES$0.26
PRODUCT FIELD CAMPAIGNS CHARGE$0.10
SPECIAL TAX ITEMS$0.76
DILUTED EARNINGS PER SHARE, AS ADJUSTED$3.89

EARNINGS BEFORE INCOME TAXESYear Ended
December 31, 2017
Year Ended
December 31, 2016
Year Ended
December 31, 2013
EARNINGS BEFORE INCOME TAXES$343.3$389.0$232.2
PENSION SETTLEMENT CHARGE$96.6$55.1
RESTRUCTURING, EXIT, INTEGRATION, AND IMPAIRMENT CHARGES$36.6$15.2$3.2
LOSS ON EARLY EXTINGUISHMENT OF DEBT$32.8
PRODUCT FIELD CAMPAIGNS CHARGE$13.5
ADJUSTED PRETAX EARNINGS$490.0$459.3$268.2

GROSS MARGINYear Ended
December 31, 2017
Year Ended
December 31, 2016
GROSS MARGIN$1,234.7$1,180.3
PRODUCT FIELD CAMPAIGNS CHARGE$8.4
GROSS MARGIN, AS ADJUSTED$1,243.1$1,180.3

OPERATING EARNINGSYear Ended
December 31, 2017
Year Ended
December 31, 2016
GAAP OPERATING EARNINGS $354.9$406.9
PENSION SETTLEMENT CHARGE  $96.6$55.1
RESTRUCTURING, EXIT, INTEGRATION, AND IMPAIRMENT CHARGES  $36.6$15.2
PRODUCT FIELD CAMPAIGNS CHARGE  $13.5
OPERATING EARNINGS, AS ADJUSTED $501.6$477.2

*All figures reflect continuing operations only

 2018 PROXY STATEMENT | 61

The  

Brunswick StoryCorporation is a publicly held company listed on the New York and Chicago stock exchanges, with sales over $4.5 billion annually. While we are family to approximately 15,000 employees around the world, three divisions in more than 30 countries create a local environment. Our global headquarters is located in the Chicago suburb of Mettawa, IL.

 

HeadquarteredSince Brunswick was founded in Lake Forest, Ill., Brunswick Corporation endeavors1845, the Company has grown to instill “Genuine Ingenuity”(TM)become a world leader in all its leading consumer brands, including Mercuryeach of our product categories: marine propulsion, boat and Mariner outboard engines; Mercury MerCruiser sterndrivesfitness. We’ve been successful in the market for so long because we maintain a focus on driving innovation, while leveraging best practices and inboard engines; MotorGuide trolling motors; Attwood, Garelick and Whale marine parts and accessories; Land ‘N’ Sea, Kellogg Marine, Diversified Marine, BLA and Bell RPG parts and accessories distributors; Bayliner, Boston Whaler, Brunswick Commercial and Government Products, Crestliner, Cypress Cay, Harris, Lowe, Lund, Meridian, Princecraft, Quicksilver, Rayglass, Sea Ray and Uttern boats, and Life Fitness, Hammer Strength, Cybex and SCIFIT fitness equipment; InMovement products and servicesveteran industry knowledge. Here, your ideas for productive well-being; and Brunswick billiards tables, accessories and game room furniture. For more information, visithttp://www.brunswick.com.company growth are backed by a nearly 175-year legacy of experience.

READ OUR ONLINE ANNUAL REPORT

www.brunswick.com/investors/publications-and-filings/annualreports.php

VISIT OUR INVESTOR RELATIONS WEBSITE

www.brunswick.com/investors


 

BRUNSWICK CORPORATION
26125 N. RIVERWOODS BLVD., SUITE 500
METTAWA, IL 60045-3420

VOTE BY INTERNET - www.proxyvote.com

Use the Internet to transmit your voting instructions and for electronic delivery of information until 5:00 p.m. Eastern Time on Tuesday, May 1, 2018. Have your proxy card in hand when you access the website and follow the instructions to obtain your records and to create an electronic voting instruction form.

ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS

If you would like to reduce the costs incurred by Brunswick Corporation in mailing proxy materials, you can consent to receive all future proxy statements, proxy cards and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy materials electronically in future years.

VOTE BY PHONE - 1-800-690-6903

Use any touch-tone telephone to transmit your voting instructions until 5:00 p.m. Eastern Time on Tuesday, May 1, 2018. Have your proxy card in hand when you call and follow the instructions.

VOTE BY MAIL

Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.

TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:

E38715-Z72139                                    KEEP THIS PORTION FOR YOUR RECORDS

DETACH AND RETURN THIS PORTION ONLY

THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.

BRUNSWICK CORPORATION

The Board of Directors recommends you vote FOR the following nominees:

1.    Election of Directors

ForAgainstAbstain

        1a.

Manuel A. Fernandez

o

o

o

        1b.

Mark D. Schwabero

o

o

o

        1c.

David V. Singer

o

o

o

        1d.

J. Steven Whislerooo
The Board of Directors recommends you vote FOR the following proposals:ForAgainstAbstain

2.    The approval of amendments to our Restated Certificate of Incorporation to declassify the Board of Directors.

o

o

o

3.    The approval of the compensation of our Named Executive Officers on an advisory basis.

o

o

o

4.    The ratification of the Audit Committee’s appointment of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2018.

ooo
NOTE: In their discretion, on such other business as may properly come before the meeting.
Please indicate if you plan to attend this meeting.

Yes

o

No

o

Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name by authorized officer.

Signature [PLEASE SIGN WITHIN BOX]

Date

Signature (Joint Owners)

Date

 

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Go to website

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Follow these three easy steps:

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Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:

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E38716-Z72139

Solicited on behalf of the Board of Directors of

BRUNSWICK CORPORATION

The undersigned hereby appoints W.L. Metzger, C.F. Dekker, and S.J. Kagay, and each of them, as proxies with power of substitution, and hereby authorizes them to represent and to vote, in accordance with the instructions on the reverse side, all shares of Common Stock of Brunswick Corporation that the undersigned may be entitled to vote at the Annual Meeting of Shareholders to be held on May 2, 2018 or any adjournment thereof. If no voting instructions are given, the proxies will vote the shares in accordance with the recommendations of the Board of Directors.

As applicable, this proxy also provides voting instructions for shares held by Vanguard Fiduciary Trust Company, the Trustee for the Brunswick Retirement Savings Plan and the Brunswick Rewards Plan, and directs such Trustee to vote, as indicated on the reverse side of this card, any shares allocated to the account in these plans. The Trustee will vote these shares as you direct. The Trustee will vote allocated shares of the Company’s stock for which proxies are not received in direct proportion to voting by allocated shares for which proxies are received.

This proxy/voting instruction card is solicited pursuant to a separate Notice of Annual Meeting and Proxy Statement, receipt of which is hereby acknowledged. This card should be voted by mail, Internet or telephone, in time to reach the Company’s proxy tabulator, Broadridge, no later than 5:00 p.m. Eastern Time on Tuesday, May 1, 2018, for all registered shares to be voted and no later than 5:00 p.m. Eastern Time on Friday, April 27, 2018, for the Trustee to vote the plan shares. Individual proxy voting and voting instructions will be kept confidential.

Continued and to be signed on reverse side