POE & BROWN, INC.
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[X ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
Poe & Brown, Inc.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
You are invited to attend the Annual Meeting of Shareholders of Poe &
Brown, Inc. (the "Company"), which will be held in the Bill France "A"
Room of the Hilton Daytona Beach Oceanfront Resort, 2637 S. Atlantic
Avenue, Daytona Beach, Florida, on Wednesday, April 28, 1999, at 9:00 a.m.
The notice of meeting and proxy statement on the following pages cover
the formal business of the Meeting. Whether or not you expect to attend
the Meeting, please sign and return your proxy card promptly in the
enclosed envelope to assure that your stock will be represented at the
Meeting. If you decide to attend the Annual Meeting and vote in person,
you will, of course, have that opportunity.
Your continuing interest in the business of the Company is gratefully
acknowledged. We hope many shareholders will attend the Meeting.
J. Hyatt Brown
Chairman of the Board, President
and Chief Executive Officer
POE & BROWN, INC.
220 South Ridgewood Avenue 401 E. Jackson Street, Suite 1700
Daytona Beach, Florida 32114 Tampa, Florida 33602
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
April 28, 1999
The Annual Meeting of Shareholders of Poe & Brown, Inc. will be held in
the Bill France "A" Room of the Hilton Daytona Beach Oceanfront Resort,
2637 S. Atlantic Avenue, Daytona Beach, Florida, on Wednesday,
April 28, 1999, at 9:00 a.m., for the following purposes:
1. To elect eight nominees to the Company's Board of Directors;
2. To approve a proposal to amend the Company's Articles of
Incorporation to change the Company's corporate name from
"Poe & Brown, Inc." to "Brown & Brown, Inc."; and
3. To transact such other business as may properly come before the
Meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on March 5, 1999
as the record date for the determination of shareholders entitled to
notice of and to vote at the Annual Meeting.
Shareholders are requested to vote, date, sign and promptly return
the enclosed proxy in the envelope provided for that purpose, whether or
not they intend to be present at the meeting.
By Order of the Board of Directors
Laurel L. Grammig
March __, 199
POE & BROWN, INC.
ANNUAL MEETING AND PROXY SOLICITATION INFORMATION
This Proxy Statement is first being sent to shareholders on or about
March ___, 1999 in connection with the solicitation of proxies by the
Board of Directors of Poe & Brown, Inc. (the "Company"), to be voted at
the Annual Meeting of Shareholders to be held in the Bill France "A"
Room of the Hilton Daytona Beach Oceanfront Resort, 2637 S. Atlantic Avenue,
Daytona Beach, Florida at 9:00 a.m. on Wednesday, April 28, 1999, and at
any adjournment thereof (the "Meeting"). The close of business on
March 5, 1999 has been fixed as the record date for the determination of
shareholders entitled to notice of and to vote at the Meeting. At the
close of business on the record date, the Company had outstanding
____________ shares of $.10 par value common stock, entitled to one
vote per share.
Shares represented by duly executed proxies in the accompanying form
received by the Company prior to the Meeting will be voted at the Meeting.
If a shareholder specifies in the proxy a choice with respect to any
matter to be acted upon, the shares represented by such proxy
will be voted as specified. If a proxy card is signed and returned
without specifying a vote or an abstention on any proposal, the shares
represented by such proxy will be voted according to the recommendation
of the Board of Directors on that proposal. The Board of Directors
recommends a vote FOR the election of the directors and the proposal
to change the corporate name of the Company. The Board of Directors
knows of no other matters that may be brought before the Meeting.
However, if any other matters are properly presented for action, it is the
intention of the named proxies to vote on them according to their best
Shareholders who hold their shares through an intermediary must
provide instructions on voting as requested by their bank or broker.
A shareholder who signs and returns a proxy may revoke it at any time
before it is voted by taking one of the following three actions: (i) giving
written notice of the revocation to the Secretary of the Company;
(ii) executing and delivering a proxy with a later date; or (iii) voting
in person at the Meeting. Votes cast by proxy or in person
at the Meeting will be tabulated by the Company's transfer agent,
First Union National Bank of North Carolina, and by one or more
inspectors of election appointed at the Meeting, who will
also determine whether a quorum is present for the transaction of business.
A shareholder who abstains from voting on any proposal will be included
in the number of shareholders present at the Meeting for the purpose of
determining the presence of a quorum. Abstentions will not be counted
either in favor of or against the election of the nominees for director
or any of the other proposals. Brokers holding stock for the accounts
of their clients who have not been given specific voting instructions as
to a matter by their clients, may vote their clients' proxies in their
The expense of preparing, printing and mailing proxy materials to
shareholders of the Company will be borne by the Company. In
addition to solicitations by mail, employees of the Company may
solicit proxies on behalf of the Board of Directors in person or by
telephone. The Company has also retained Corporate Investor
Communications, Inc., of Carlstadt, New Jersey, to aid solicitation
by mail for a fee of approximately $4,000, which will be paid by the
Company. The Company will also reimburse brokerage houses and other
nominees for their expenses in forwarding proxy material to beneficial
owners of the Company's stock.
The executive offices of the Company are located at 220 South
Ridgewood Avenue, Daytona Beach, Florida 32114 (telephone
number (904) 252-9601) and 401 East Jackson Street, Suite 1700,
Tampa, Florida 33602 (telephone number (813) 222-4100).
SECURITY OWNERSHIP OF MANAGEMENT AND
CERTAIN BENEFICIAL OWNERS
The following table sets forth, as of March 5, 1999, information as
to the Company's common stock beneficially owned by (i) each director
of the Company, (ii) each executive officer named in the Summary
Compensation Table, (iii) all directors and executive officers of the
Company as a group, and (iv) any person who is known by the Company to
be the beneficial owner of more than 5% of the outstanding shares of
the Company's common stock.
(1) Beneficial ownership of shares, as determined in accordance with
applicable Securities and Exchange Commission rules, includes shares as
to which a person has or shares voting power and/or investment power.
The Company has been informed that all shares shown are held of record
with sole voting and investment power, except as otherwise indicated.
(2) The number and percentage of shares owned by the following persons
include the indicated number of shares owned through the Company's 401(k)
Plan as of December 31, 1998: Mr. Henderson - 48,718; Mr. Zimmer - 167;
Ms. Grammig - 2,771; Mr. Olivier - 466; all directors and officers as a
group - 52,122. The number and percentage of shares owned by the
following persons include the indicated number of shares which such
persons have been granted under the Company's Stock Performance Plan
as of December 31, 1998 and which have satisfied the first condition
for vesting: Mr. Henderson - 15,000; Ms. Grammig - 3,000; Mr. Zimmer
- 2,730; Mr. Olivier - 1,365; all officers and directors as a group
- 22,095. These Stock Performance Plan shares have voting rights,
but the holders thereof have no power to sell or dispose of the
shares, and the shares are subject to forfeiture. See "Executive
Compensation - Long-Term Incentive Plans - Awards in Last Fiscal Year."
(3) All shares are beneficially owned jointly with Mr. Brown's wife
through a limited partnership, and these shares have shared voting and
(4) All shares are held in joint tenancy with Mr. Bell's wife, and these
shares have shared voting and investment power.
(5) Mr. Henderson's ownership includes 1,500 shares owned by a daughter
sharing his household, as to which beneficial ownership is disclaimed.
(6) All shares are owned by Mr. Hill's spouse, and he disclaims beneficial
ownership of these shares. Mr. Hill is not standing for re-election as
a director of the Company.
(7) Mr. Smith's ownership includes 350 shares owned by his spouse, as to
which he disclaims beneficial ownership.
(8) Mr. Zimmer resigned as an executive officer of the Company effective
March 1, 1999, and accepted a position as profit center manager of the
Company's Jacksonville office.
(9) Based upon information contained in a report filed by T. Rowe Price
Associates, Inc. ("Price Associates") with the Securities and Exchange
Commission, these securities are owned by various individuals and
institutional investors, including T. Rowe Price Small-Cap Value
Fund (which owns 875,000 shares, representing ____% of the shares
outstanding), for which Price Associates serves as investment adviser
with power to direct investments and/or sole power to vote the
securities. Under Securities and Exchange Commission rules, Price
Associates is deemed to be a beneficial owner of such securities;
however, Price Associates disclaims beneficial ownership of such
Directors and Executive Officers
Set forth below is certain information concerning the Company's executive
officers and directors nominated for election at the Meeting. All directors
and officers hold office for one-year terms or until their successors are
elected and qualified.
Amount and Nature of
Name of Beneficial Owner Beneficial Ownership(1)(2) Percent
J. Hyatt Brown(3) 2,717,666 ___%
220 South Ridgewood Avenue
Daytona Beach, Florida 32114
Samuel P. Bell, III(4) 1,650 *
Bradley Currey, Jr. 37,500 *
Jim W. Henderson(5) 120,483 *
Kenneth E. Hill(6) 6,048 *
Theodore J. Hoepner 1,500 *
David H. Hughes 1,500 *
Toni Jennings - *
Jan E. Smith(7) 2,850 *
William A. Zimmer(8) 3,639 *
Laurel L. Grammig 8,606 *
James L. Olivier 2,807 *
T. Rowe Price Associates, Inc. (9) 1,485,950 ____%
100 E. Pratt Street
Baltimore, MD 21202
All directors and executive
officers as a group (13 persons) 2,904,564 ____%
*Less than 1%
J. Hyatt Brown. Mr. Brown has been the President and Chief Executive
Officer of the Company since April 1993, and the Chairman of the Board of
Directors since October 1994. Mr. Brown has been President and Chief
Executive Officer of Brown & Brown, Inc., presently a subsidiary of the
Company, since 1961. He was a member of the Florida House of
Representatives from 1972 to 1980, and Speaker of the House from 1978
to 1980. Mr. Brown serves on the Board of Directors of SunTrust Banks,
Inc., SunTrust Bank, East Central Florida, N.A., International Speedway
Corporation, The FPL Group, Inc., BellSouth Corporation, Rock-Tenn Company,
and First Floridian Auto and Home Insurance Company. He also serves on
the Board of Trustees of Stetson University.
Jim W. Henderson. Mr. Henderson served as Senior Vice President of the
Company since April 1993, and was elected Executive Vice President in
January of 1995. He served as Senior Vice President of Brown &
Brown, Inc. from 1989 to 1993. He also served as Chief Financial
Officer of Brown & Brown from 1985 to 1989.
Samuel P. Bell, III. Mr. Bell has been a shareholder of the law firm of
Pennington, Moore, Wilkinson, Bell & Dunbar, P.A. since January 1, 1998
and also serves as Of Counsel to the law firm of Cobb, Cole & Bell.
Prior to that, he was a shareholder and managing partner of Cobb Cole &
Bell. He has served as counsel to Brown & Brown, Inc. since 1964.
Mr. Bell was a member of the Florida House of Representatives from 1974
Bradley Currey, Jr. Mr. Currey has been Chief Executive Officer of
Rock-Tenn Company, a manufacturer of packaging and recycled paperboard
products, since 1989, and has served as Chairman of the Board of Rock-Tenn
since 1993. He also previously served as President (1978-1995) and Chief
Operating Officer (1978-1989) of Rock-Tenn. Mr. Currey is a member of the
Board of Directors of Genuine Parts Company and is the Chairman of the Board
of Trustees of Emory University. He is also a past Chairman of the Federal
Reserve Bank of Atlanta.
Theodore J. Hoepner. Mr. Hoepner has been the Chairman of the Board,
President and Chief Executive Officer of SunTrust Banks of Florida, Inc.
since 1995. From 1990 through 1995, he served as Chairman of the Board,
President and Chief Executive Officer of SunBank, N.A. From 1983 through
1990, he was the Chairman of the Board and Chief Executive Officer
of SunBank/Miami, N.A.
David H. Hughes. Mr. Hughes has been President of Hughes Supply, Inc.,
a diversified wholesale distributor, since 1972. He has served as Chief
Executive Officer of Hughes Supply since 1974 and Chairman of the Board
of Directors since 1986. Mr. Hughes is a member of the Board of Directors
of SunTrust Banks, Inc., Orlando Regional Healthcare Systems, Arnold
Palmer Children's Hospital, Florida Tax Watch and Accord Industries.
Toni Jennings. Ms. Jennings was elected to the Company's Board of
Directors in January 1999. She has been President of Jack Jennings &
Sons, a commercial construction firm based in Orlando, Florida, since
1982. She has been a Florida State Senator since 1980 and currently
serves as President of the Florida Senate. She previously served in
the Florida House of Representatives from 1976 to 1980. She currently
serves on the Salvation Army Advisory Board and the NationsBank Advisory
Jan E. Smith. Mr. Smith has served as President of Jan Smith & Company, a
commercial real estate and business investment firm, since 1978. Mr. Smith
is also the managing general partner of Ramblers Rest Resort, Ltd., a
recreational vehicle park in Venice, Florida, and President of Travel
Associates, Inc., which owns and operates Trexler World Travel Service
in Charlotte, North Carolina. Mr. Smith also serves on the Board of
Directors of SunTrust Bank, Gulf Coast.
Laurel L. Grammig. Ms. Grammig has been Secretary and General Counsel
of the Company since January 1994, and she became a Vice President in
April 1994. She was a partner of the law firm of Holland & Knight from
1991 through 1993.
Jeffrey R. Paro. Mr. Paro became Vice President, Chief Financial Officer
and Treasurer of the Company on March 1, 1999. He joined the Company in
1997 and served as Tax Director until his recent promotion. Before
joining the Company, he worked for six years in the tax department of
Price Waterhouse in Milwaukee, Wisconsin, serving the last two years as tax
James L. Olivier. Mr. Olivier was elected a Vice President of the Company
in April 1998 and has served as Assistant General Counsel since joining
the Company in 1996. Prior to that, Mr. Olivier was an associate and
then partner of the law firm of Holland & Knight.
Meetings of the Board of Directors and Standing Committees
During 1998, the Company's Board of Directors held seven meetings. Each
incumbent director attended at least 75% of the total number of Board
meetings and meetings of committees of which he or she is a member, except
for Ms. Jennings, who did not join the Board of Directors until January 1999.
The Company's Board of Directors has a Compensation Committee and an Audit
Committee. The Compensation Committee currently consists of Samuel P.
Bell, III (Chairman), J. Hyatt Brown, Bradley Currey, Jr., Theodore J.
Hoepner, David H. Hughes, Toni Jennings and Jan E. Smith. The
Compensation Committee recommends to the Board base salary levels and
bonuses for the Chief Executive Officer and approves the guidelines used
to determine salary levels and bonuses for the other executive officers
of the Company. See "Executive Compensation - Board Compensation
Committee Report on Executive Compensation." The Compensation Committee
also reviews and makes recommendations with respect to the Company's
existing and proposed compensation plans, and is responsible for
administering the Company's Amended 1989 Stock Option Plan, the 1990
Employee Stock Purchase Plan, and the Stock Performance Plan. The
Compensation Committee met four times in 1998.
The members of the Audit Committee currently are Theodore J. Hoepner
(Chairman), Samuel P. Bell, III, Bradley Currey, Jr., David H. Hughes,
Toni Jennings and Jan E. Smith. The duties of the Audit Committee,
which met four times during 1998, are to recommend to the Board
of Directors the selection of independent certified public accountants,
to meet with the Company's independent certified public accountants
to review the scope and results of the annual
audit, and to consider various accounting and auditing matters related
to the Company, including its system of internal controls and financial
The Company does not have a nominating committee. This function is
performed by the Board of Directors.
Compensation of Directors
Directors who are not employees of the Company are paid $3,000 for each
Board meeting attended in person and $1,500 for each Board meeting
attended by telephone. Directors receive $1,500 for each committee
meeting attended if such meetings occur other than in conjunction
with regularly scheduled quarterly Board meetings. In 1998, Mr. Hughes and
Mr. Smith each received $1,500 for their service on a special committee
appointed by the Board of Directors.
In addition, directors are eligible to receive grants of stock options
under the Company's Amended 1989 Stock Option Plan. No option grants were
made to directors in 1998. All directors receive reimbursement of
reasonable out-of-pocket expenses incurred in connection with meetings
of the Board of Directors. No director who is an employee of the Company
receives separate compensation for services rendered as a director.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
executive officers and directors, and persons who own more than ten
percent of the outstanding shares of common stock of the Company, to
file reports of ownership and changes in ownership with the Securities
and Exchange Commission. Officers, directors and ten percent shareholders
are required by SEC regulations to furnish the Company with copies of all
Section 16(a) reports they file.
Based solely on its review of the copies of such reports received by it,
and written representations from certain reporting persons that no SEC
Form 5s were required to be filed by those persons, the Company believes
that during 1998, its officers, directors and ten percent beneficial
owners timely complied with all applicable filing requirements, except
for Jan E. Smith, a director, who was late in filing three Form 4s with
respect to three transactions, and Samuel P. Bell, a director, who was
late in filing one Form 4 with respect to one transaction. Each of the
subject transactions has since been reported.
The following table sets forth the compensation received by the
Company's Chief Executive Officer and the four other highest paid
executive officers in 1998 (the "Named Executive Officers") for services
rendered to the Company for each of the three years in the period ended
December 31, 1998. Compensation information is also provided with respect
to Kenneth E. Hill, who served as Executive Vice President of the Company
through April 1998.
Name Positions Age Director
_____ _________ ___ ________
J. Hyatt Brown Chairman of the Board, President 61 1993
and Chief Executive Officer
Jim W. Henderson Executive Vice President, 52 1993
Samuel P. Bell, III Director 59 1993
Bradley Currey, Jr. Director 68 1995
Theodore J. Hoepner Director 57 1994
David H. Hughes Director 55 1997
Toni Jennings Director 49 1999
Jan E. Smith Director 59 1997
Laurel L. Grammig Vice President, Secretary and 40 ---
Jeffrey R. Paro Vice President, Chief Financial 40 ---
Officer and Treasurer
James L. Olivier Vice President and Assistant 38 ---
Summary Compensation Table
(1) See "Executive Compensation - Long-Term Incentive Plans - Awards in
Last Fiscal Year" for a discussion of 1998 Stock Performance Plan grants.
(2) Amounts represent the Company's profit sharing and 401(k) plan matching
(3) Certain of the Named Executive Officers have been granted shares of
performance stock under the Company's Stock Performance Plan. For a
description of the terms of such grants, the number of shares granted,
and the value of such shares, see "Executive Compensation - Long-Term
Incentive Plans - Awards in Last Fiscal Year."
(4) Amounts shown for 1996 and 1997 reflect annual amounts accrued related
to the deferred compensation agreement for Mr. Hill. This agreement was
superseded in 1998, and amounts shown for 1998 reflect
amounts payable under Mr. Hill's current agreement with the Company.
See "Executive Compensation - Employment and Deferred Compensation
Agreements." Mr. Hill resigned as Executive Vice President in
(5) Mr. Zimmer resigned as an executive officer of the Company effective
March 1, 1999. Compensation figures for Mr. Zimmer in 1996 reflect that
he joined the Company in November 1996.
(6) Mr. Olivier joined the Company in February 1996.
Option Grants in 1998
No stock options were granted to the Named Executive Officers in 1998.
Aggregate Option Exercises in 1998 and December 31, 1998 Option Values
None of the Named Executive Officers exercised Company stock options during
the year ended December 31, 1998, and none of the Named Executive Officers
held unexercised Company stock options as of December 31, 1998.
Long-Term Incentive Plans - Awards in Last Fiscal Year
Grants of stock under the Company's Stock Performance Plan are intended to
provide an incentive for key employees to achieve long-range performance
goals of the Company, generally by providing incentives to remain with
the Company for a long period after the grant date and by tying the
vesting of the grant to appreciation of the Company's stock price. The
table below sets forth the number of shares of performance stock granted
to the Named Executive Officers in 1998 and the criteria for vesting.
Other All Other
Name and Annual Compen-
Principal Compen- sation
Position Year Salary($) Bonus($) sation($)(1) ($)(2)(3)
J. Hyatt Brown 1998 415,990 253,973 --- 6,400
Chairman of the Board, 1997 396,200 218,942 --- 4,000
President & Chief 1996 377,000 187,450 --- 6,000
Jim W. Henderson 1998 296,927 209,000 --- 6,400
Executive Vice 1997 271,936 148,000 --- 6,400
President 1996 247,500 144,000 --- 6,000
Kenneth E. Hill 1998 348,439 --- 276,792(4) 6,400
Former Executive Vice 1997 251,120 --- 250,874(4) 6,400
President(4) 1996 309,753 --- 220,068(4) 6,000
Laurel L. Grammig 1998 125,432 60,000 --- 6,400
Vice President, 1997 115,000 40,880 --- 5,993
Secretary & General 1996 105,000 35,000 --- 5,600
William A. Zimmer 1998 114,503 60,000 --- 5,580
Former Vice President, 1997 84,670 25,000 --- 3,435
Chief Financial 1996 9,519 1,200 --- ---
Officer & Treasurer(5)
James L. Olivier 1998 91,533 13,230 --- 4,165
Vice President & 1997 83,927 12,600 --- 3,837
Assistant General 1996(6) 67,692 12,000 --- 2,708
(1) None of the shares of performance stock granted to the Named Executive
Officers has vested as of the date of this Proxy Statement. In order for
the grants described above to fully vest, the grantee would have to
remain with the Company for a period of 15 years from the date of
grant (subject to the exceptions set forth in footnote (3) below)
and the Company's stock price would have to appreciate at a rate of
20% per year for the five-year period beginning on the grant date in
1998. For each 20% increase in the Company's stock price within such
five-year period, dividends will be payable to the grantee on 20% of
the shares granted to him or her and the grantee will have the power
to vote such shares. The grantee will not have any of the other
indicia of ownership (e.g., the right to sell or transfer the shares)
until such shares are fully vested.
(2) The dollar values of the grants to Mr. Henderson, Mr. Zimmer,
Ms. Grammig and Mr. Olivier on the date of grant were $300,050,
$74,970, $99,960, and $49,980, respectively. These values represent
the number of shares granted multiplied by the closing market price
of the Company's common stock on the New York Stock Exchange on the date
of grant. The aggregate number of shares of performance stock granted to
the Named Executive Officers as of December 31, 1998 were
23,825 for Mr. Henderson, 4,935 for Mr. Zimmer, 5,940 for Ms. Grammig
and 2,835 for Mr. Olivier. The dollar values of all shares of
performance stock granted to the Named Executive Officers as of
December 31, 1998 were $832,386 for Mr. Henderson, $172,417 for
Mr. Zimmer, $207,529 for Ms. Grammig and $99,048 for Mr. Olivier.
(3) If the grantee's employment with the Company were to terminate before
the end of the 15-year vesting period, such grantee's interest in his or
her shares would be forfeited unless (i) the grantee has attained age
64, (ii) the grantee's employment with the Company terminates as a result
of his or her death or disability, or (iii) the Compensation Committee,
in its sole and absolute discretion, waives the conditions of the grant
of performance stock.
Employment and Deferred Compensation Agreements
On April 28, 1993, J. Hyatt Brown and Jim W. Henderson each entered
into similar employment agreements with the Company. Each agreement
may be terminated by either party upon 30 days advance written notice.
Compensation under these agreements is at amounts agreed upon between
the Company and such employee from time to time. Additionally, for a
period of three years following the termination of employment, each
agreement prohibits the employee from directly or indirectly soliciting
or servicing the Company's customers.
Brown & Brown, Inc., presently a subsidiary of the Company, entered
into a deferred compensation agreement with Kenneth E. Hill, dated
April 27, 1993. That agreement was superseded by a new agreement
entered into by the parties in April 1998. The new agreement provides
that the Company will pay Mr. Hill (or his beneficiaries, in the event
of his death) $276,792 annually for ten years beginning June 1, 1998.
Mr. Hill also entered into a seven-year employment agreement in 1998,
which provides that Mr. Hill will receive an annual salary of $250,000
commencing on May 1, 1998. His salary shall increase by $10,000 each
year during the term of the agreement. The Company agreed to purchase
and maintain a life insurance policy on Mr. Hill, payable to his
beneficiaries, in an amount representing the balance of the unpaid
annual salary payments should he die before the end of the term of
the agreement. The Company also agreed to provide Mr. Hill's spouse and
dependents up to $10,000 per year for use in purchasing health insurance
if Mr. Hill dies before April 30, 2002 for each year during the term of
the agreement that they would not be eligible to purchase continuation
health coverage under the Company's medical plan and the terms of the
Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA).
Compensation Committee Interlocks and Insider Participation
The members of the Company's Compensation Committee during 1998 were
Samuel P. Bell, III (Chairman), J. Hyatt Brown, Bradley Currey, Jr.,
Theodore J. Hoepner, David H. Hughes and Jan E. Smith. Mr. Brown is
the Company's Chairman, President and Chief Executive Officer.
Samuel P. Bell, III is a partner in the law firm of Pennington, Moore,
Wilkinson, Bell & Dunbar, P.A. and serves as Of Counsel to the law firm
of Cobb Cole & Bell. Each of these firms performed services for the
Company in 1998 and each is expected to continue to perform legal
services for the Company during 1999.
J. Hyatt Brown is a significant shareholder and a director of Rock-Tenn
Company, which is a customer of the Company. Rock-Tenn's Chairman and
Chief Executive Officer, Bradley Currey, Jr., is a director of the
Company and a member of the Company's Compensation Committee.
Theodore J. Hoepner is the Chairman of the Board, President and Chief
Executive Officer of SunTrust Banks of Florida, Inc., which is the parent
company of SunTrust Bank, Central Florida, N.A. In 1998, the Company
increased its existing $10 million line of credit with SunTrust Bank,
Central Florida, N.A. to $50 million. The Company expects to continue
to use SunTrust Bank, Central Florida, N.A. during 1999 for some of its
cash management requirements. J. Hyatt Brown is a director of SunTrust
Banks, Inc., the parent company of SunTrust Banks of Florida, Inc., and
a director of SunTrust Banks, East Central Florida, N.A. David H. Hughes
serves on the Board of Directors of SunTrust Banks, Inc., and Jan E.
Smith serves on the Board of Directors of SunTrust Bank, Gulf Coast.
Notwithstanding anything to the contrary set forth in any of the Company's
previous filings under the Securities Act of 1933 or the Securities
Exchange Act of 1934 that might incorporate future filings, including
this Proxy Statement, in whole or in part, the following Board
Compensation Committee Report on Executive Compensation and the
Performance Graph shall not be incorporated by reference into any
Board Compensation Committee Report on Executive Compensation
The Company's overall compensation philosophy is as follows:
- Attract and retain high-quality people, which is crucial to both the
short-term and long-term success of the Company;
- Reinforce strategic performance objectives through the use of
incentive compensation programs; and
- Create a mutuality of interest between the executive officers and
shareholders through compensation structures that share the rewards
and risks of strategic decision-making.
Base Compensation. Salary levels for officers other than the Chief
Executive Officer are determined by the Chief Executive Officer each
year during the first quarter based upon the qualitative performance of
each officer during the previous year and guidelines approved by the
Compensation Committee. If an officer has had no change in duties, the
percentage of annual salary increases for such officer generally has
been approximately 5% of the officer's base salary, although it is
expected that salary increases in 1999 will generally be approximately
2 1/2%. Exceptional performance or a change in the officer's
responsibilities may merit a larger increase.
Annual Bonuses. Bonuses for managers of the Company's Retail Division
profit centers are established by the profit center manager from a bonus
pool allocated to that manager's profit center through a pre-determined
formula. For 1998, in each Retail Division profit center, the aggregate
annual bonuses to be allocated among the employees of that profit center
ranged from 3% to 12% of that profit center's operating profit before
interest, amortization and profit center bonus. The highest bonus levels
are not met until the profit center's operating profit percentage
is equal to or greater than 28%. Other divisions of the Company have
similar objective measures of bonus potential based on achievement of
targeted operating or pre-tax goals. The annual bonus for Mr. Henderson,
who, in addition to other duties, served as the profit center manager for
the Daytona Beach retail operation, was established based on a subjective
allocation of the aggregate profit center bonus earned by the Daytona
Beach retail profit center.
The bonuses for the executive officers who are not profit center managers
are determined by the Chief Executive Officer based primarily on objective
criteria, such as a percentage of the officer's salary, the earnings
growth of the Company as a whole, and a subjective analysis of the
officer's duties and performance. The proposed bonuses are reviewed by
the Committee and either approved or revised.
Long-Term Compensation. The Committee may also grant incentive stock
options and/or shares of performance stock to officers and other key
employees based upon salary levels, sales production levels and performance
evaluations. No stock options were granted to executive officers in 1998.
Grants of performance stock were made in 1998 to certain of the Named
Executive Officers, as well as to other non-executive employees of the
Company. See "Executive Compensation - Long-Term Incentive Plans -
Awards in Last Fiscal Year."
CEO Compensation. With respect to the salary and bonus of J. Hyatt
Brown, the Chairman, President and Chief Executive Officer of the
Company, the Compensation Committee annually sets these amounts by
reference to the general operating performance of the Company. The
performance criteria most closely examined by the Committee are
improvements in the Company's earnings per share and net income, as
well as the continuing growth of the Company's business. The Committee
also considers salary levels of chief executive officers in companies
similar to the Company and makes adjustments believed appropriate based
upon the differences in size of the peer companies as compared to the
Company. The Committee reports the salary and bonus amounts recommended
for the Chief Executive Officer to the full Board of Directors and
responds to questions, if any. At that time, the Board may change
salary levels or bonus amounts.
The $253,973 bonus recommended by the Committee (excluding Mr. Brown,
who did not participate in this determination) and approved by the Board
(excluding Mr. Brown) is 16% higher than Mr. Brown's 1997 bonus. This
increase reflects the 16% increase in the Company's earnings per share
over 1997, as originally reported.
The financial performance of the Company during 1998 was at the
expected budgeted levels, and the Committee took this into consideration
in establishing compensation levels.
Samuel P. Bell, III (Chairman)
J. Hyatt Brown
Bradley Currey, Jr.
Theodore J. Hoepner
David H. Hughes
Jan E. Smith
The following graph is a comparison of five-year cumulative total
returns for the Company's common stock as compared with the cumulative
total return for the Standard & Poor's 500 Index, and a group of peer
insurance broker and agency companies (Aon Corporation, Arthur J. Gallagher
& Co., Hilb, Rogal and Hamilton Company, and Marsh & McLennan Companies,
Inc.). The returns of the companies have been weighted according to their
respective stock market capitalizations as of January 1, 1998, for purposes
of arriving at a peer group average. The total return calculations are
based upon an assumed $100 investment on December 31, 1993, with all
Performance or Other Period
Name Number of Shares(1)(2) Until Maturation or Payout(3)
____ ________________ __________________________
J. Hyatt Brown --- ---
Jim W. Henderson 8,825 15 years
Kenneth E. Hill --- ---
William A. Zimmer 2,205 15 years
Laurel L. Grammig 2,940 15 years
James L. Olivier 1,470 15 years
The Company cautions that the stock price performance shown in the graph
should not be considered indicative of potential future stock price
PROPOSAL 1 - ELECTION OF DIRECTORS
The eight nominees for election as directors at the Meeting are J. Hyatt
Brown, Samuel P. Bell, III, Bradley Currey, Jr., Jim W. Henderson,
Theodore J. Hoepner, David H. Hughes, Toni Jennings and Jan E. Smith.
Information concerning each of the nominees is set forth under the caption
"Management - Directors and Executive Officers." All nominees are now
members of the Board of Directors. If elected, each of the nominees
will serve a one-year term until the next Annual Meeting of Shareholders.
Approval of the election of directors will require a plurality of the
votes cast at the Meeting, provided a quorum is present. Unless otherwise
indicated, votes will be cast pursuant to the accompanying proxy FOR the
election of these nominees. Should any nominee become unable or unwilling
to accept nomination or election for any reason, it is expected that the
resulting vacancy will not immediately be filled. The Board has no reason
to believe that any of the nominees will be unable or unwilling to serve
PROPOSAL 2 - AMENDMENT TO ARTICLES OF INCORPORATION
TO CHANGE THE COMPANY'S CORPORATE NAME
Description of Proposed Amendment
The Board of Directors of the Company has approved an amendment to the
Company's Articles of Incorporation to change the name of the Company
from "Poe & Brown, Inc." to "Brown & Brown, Inc." The Board of Directors
has directed that such proposed amendment be submitted to the shareholders
of the Company at the Meeting for their approval and adoption.
Reasons for the Proposed Amendment
In 1993, the Company entered into a business combination transaction with
Brown & Brown, Inc. in which the Company's corporate name was changed from
"Poe & Associates, Inc." to "Poe & Brown, Inc." Brown & Brown, Inc.
continued as a subsidiary of the Company, but its operations essentially
were transferred to the Company.
In 1994 and 1995, the Poe family liquidated substantially all of its
ownership interest in the Company and Poe family members resigned from
their positions in the Company. The Board of Directors believes that
the "Brown & Brown" name continues to have significant value and
name recognition. For the foregoing reasons, the Board of Directors
believes that changing the name of the Company to "Brown & Brown, Inc."
will better reflect the Company's current culture and management, and
will be beneficial to the Company.
Vote Required And Board Recommendation
Approval of the proposed amendment requires the affirmative vote of
owners of a majority of the outstanding shares of the Company's common
stock entitled to vote in person or by proxy at the Meeting, at which a
quorum is present and voting. The Board of Directors unanimously
approved the amendment and recommends that shareholders vote FOR the
proposal to amend the Articles of Incorporation.
INFORMATION CONCERNING INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
Representatives of Arthur Andersen LLP, the Company's independent public
auditors, are expected to be present at the Meeting with the opportunity
to make a statement if they desire to do so and to respond to appropriate
questions posed by shareholders.
PROPOSALS OF SHAREHOLDERS
Shareholders who intend to have a proposal considered for inclusion
in the Company's proxy materials for presentation at the annual meeting
in 2000 must submit the proposal to the Company no later than November 24,
1999. Shareholders who intend to present a proposal at the annual meeting
in 2000 without inclusion of such proposal in the Company's proxy materials
are required to provide notice of such proposal to the Company no later
than February 7, 2000. The Company reserves the right to reject, rule
out of order, or take other appropriate action with respect to any
proposal that does not comply with these and other applicable requirements.
The Company will provide to any shareholder, upon the written request
of such person, a copy of the Company's Annual Report on Form 10-K,
including the financial statements and the schedules thereto, for its
fiscal year ended December 31, 1998, as filed with the Securities and
Exchange Commission pursuant to Rule 13a-1 under the Securities
Exchange Act of 1934. Any such request should be directed to Poe &
Brown, Inc., 401 East Jackson Street, Suite 1700, Tampa, Florida 33602,
Attention: Corporate Secretary. No charge will be made for copies of such
annual report; however, a reasonable charge will be made for copies of
By Order of the Board of Directors
Laurel L. Grammig
March ___, 199
POE & BROWN, INC.
220 South Ridgewood Avenue 401 East Jackson Street, Suite 1700
Daytona Beach, Florida 32114 Tampa, Florida 33602
This Proxy is Solicited on Behalf of the Board of Directors
The undersigned hereby appoints Laurel L. Grammig and James L. Olivier,
or either of them, as Proxies, each with the power to appoint his or her
substitute, and hereby authorizes them or their substitutes to represent
and to vote, as designated below, all the shares of common stock of Poe &
Brown, Inc. held of record by the undersigned on March 5, 1999, at the
Annual Meeting of Shareholders to be held on April 28, 1999, or any
1. ELECTION OF DIRECTORS FOR all nominees listed below WITHHOLD AUTHORITY
(except as marked to the to vote for all
contrary below) ___ nominees listed
(INSTRUCTION: To withhold authority to vote for any individual nominee,
strike a line through the nominee's name in the list below)
J. Hyatt Brown; Samuel P. Bell, III; Bradley Currey, Jr.;
Jim W. Henderson; Theodore J. Hoepner; David H. Hughes; Toni
Jennings; Jan E. Smith
2. PROPOSAL TO AMEND THE COMPANY'S ARTICLES OF INCORPORATION TO CHANGE THE
CORPORATE NAME TO "BROWN & BROWN, INC."
___ FOR ___ AGAINST ___ ABSTAIN
3. In their discretion the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
This proxy when properly executed will be voted in the manner directed
herein by the undersigned shareholder. If no direction is made, this
proxy will be voted for Proposals 1 and 2.
Please sign exactly as name appears at left. When shares are held by
joint tenants, both should sign. When signing as attorney, executor,
administrator, trustee or guardian, please give full title as such. If
a corporation, please sign in full corporate name by President or other
authorized officer. If a partnership, please sign in partnership name
by authorized person.
DATED ______________________, 1999
Signature if held jointly
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING
THE ENCLOSED ENVELOPE.
1993 1994 1995 1996 1997 1998
____ ____ ____ ____ ____ ____
Poe & Brown, Inc. 100 124.03 144.25 156.19 260.75 307.94
S&P 500 Index 100 98.46 132.05 158.80 208.05 263.53
Peer Group of Insurance
Agents and Brokers 100 101.62 135.68 165.90 235.62 253.50