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SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934
[X] Filed by the Registrant
[ ] Filed by a Party other than the Registrant
Check the appropriate box:
[_] Preliminary Proxy Statement
[_] Confidential, for Use of Commission only (as permitted by Rule
14a-6(e)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
BIW LIMITED
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(Name of Registrant as Specified in Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than 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):
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[_] 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:
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BIW LIMITED
230 BEAVER STREET
ANSONIA, CT 06401-0426
April 8, 2004
Dear Fellow Stockholder:
You are cordially invited to attend the annual meeting of stockholders of BIW
Limited, which we will hold at 2:00 p.m., local time, on Tuesday, May 11, 2004
at the New Haven Lawn Club, 193 Whitney Avenue, New Haven, Connecticut 06511.
Company officials will be available at 1:30 p.m. should you wish to arrive
early. At the annual meeting, we will ask you to elect ten (10) nominees to
serve on our Board of Directors for the ensuing year and ratify the selection of
Dworken, Hillman, LaMorte & Sterczala, P.C. as our independent auditors for the
year ending December 31, 2004.
Only stockholders of record who hold shares of BIW Limited common stock at the
close of business on March 17, 2004, the record date for the annual meeting,
will be entitled to vote at the annual meeting. A list of stockholders entitled
to vote will be kept at the offices of BIW Limited, 230 Beaver Street, Ansonia,
Connecticut, for the ten days prior to the annual meeting.
It is important that your shares be represented and voted at the annual meeting,
whether or not you are able to attend personally. You are therefore urged to
complete, sign, date, and return the enclosed proxy card promptly in the
accompanying envelope, which requires no postage if mailed in the United States.
You are, of course, welcome to attend the meeting and vote in person, even if
you have previously returned your proxy card. I look forward to your support.
Sincerely,
/s/ John S. Tomac
President
BIW LIMITED
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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
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Notice is hereby given that the Annual Meeting of Stockholders of BIW
Limited (the "Company") will be held on Tuesday, May 11, 2004 at 2:00 p.m., at
the New Haven Lawn Club, 193 Whitney Avenue, New Haven, Connecticut 06511, for
the following purposes:
(1) To elect ten (10) directors of the Company to serve for the ensuing
year;
(2) To ratify the selection of Dworken, Hillman, LaMorte & Sterczala, P.C.
as the Company's independent auditors for the year ending December 31,
2004; and
(3) To transact such other business as may properly come before the Annual
Meeting or any adjournment thereof.
Stockholders of record at the close of business on March 17, 2004 will be
entitled to notice of and to vote at the Annual Meeting or any adjournment
thereof. All stockholders are cordially invited to attend the Annual Meeting in
person. Stockholders who are unable to attend the Annual Meeting in person are
requested to complete and date the enclosed proxy card and return it promptly in
the envelope provided. No postage is required if mailed in the United States.
Stockholders who attend the Annual Meeting may revoke their proxy and vote their
shares in person.
By Order of the Board of Directors
John S. Tomac
President
Ansonia, Connecticut
April 8, 2004
BIW LIMITED
230 BEAVER STREET
ANSONIA, CT 06401-0426
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PROXY STATEMENT
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GENERAL INFORMATION
PROXY SOLICITATION
This proxy statement and the accompanying proxy card are furnished to the
holders of common stock of BIW Limited in connection with the solicitation of
proxies for use at the annual meeting of stockholders to be held on Tuesday, May
11, 2004, or at any adjournment of the annual meeting. The purposes of the
meeting and the matters to be acted upon are described in the accompanying
Notice of Annual Meeting of Stockholders.
Proxies for use at the meeting are being solicited by BIW Limited. Proxies
will be mailed to stockholders on or about April 8, 2004 and will be solicited
chiefly by mail. We will make arrangements with brokerage houses and other
custodians, nominees and fiduciaries to send proxies and proxy material to the
beneficial owners of the shares and will reimburse them for their expenses in so
doing. Should it appear desirable to do so in order to ensure adequate
representation of shares at the meeting, our officers, agents and employees may
communicate with stockholders, banks, brokerage houses and others by telephone,
e-mail, facsimile, or in person to request that proxies be furnished. We will
pay all expenses incurred in connection with this solicitation.
REVOCABILITY AND VOTING OF PROXY
A form of proxy for use at the annual meeting and a return envelope for the
proxy are enclosed. Stockholders may revoke the authority granted by their
execution of proxies at any time before their effective exercise by filing with
our Secretary a written notice of revocation or a duly executed proxy bearing a
later date, or by voting in person at the meeting. Shares of common stock
represented by executed and unrevoked proxies will be voted in accordance with
the choice or instructions specified. If no specifications are given, the
proxies intend to vote the shares represented to approve Proposals No. 1 and 2
as described in the accompanying Notice of Annual Meeting of Stockholders and in
accordance with their best judgment on any other matters which may properly come
before the meeting.
RECORD DATE AND VOTING RIGHTS
Only stockholders of record at the close of business on March 17, 2004 are
entitled to notice of and to vote at the annual meeting or any adjournment of
the annual meeting. On March 17, 2004 there were 1,624,542 shares of common
stock outstanding. Each share is entitled to one vote on each of the matters to
be presented at the annual meeting. The holders of a majority of the outstanding
shares of common stock, present in person or by proxy, will constitute a quorum
at the annual meeting. Abstentions and broker non-votes will be counted for
purposes of determining the presence or absence of
a quorum. "Broker non-votes" are shares held by brokers or nominees which are
present in person or represented by proxy, but which are not voted on a
particular matter because instructions have not been received from the
beneficial owner. Under Connecticut law, the effect of broker non-votes on a
particular matter depends on whether the matter is one as to which the broker or
nominee has discretionary voting authority under the applicable rule of the
American Stock Exchange. The effect of broker non-votes on the specific items to
be brought before the annual meeting is discussed under each item.
PROPOSAL NO. 1 - ELECTION OF DIRECTORS
Our By-laws provide for not less than seven nor more than fifteen directors
to be elected at the Annual Meeting of Stockholders, each to serve for the
ensuing year and until his or her successor is elected and has qualified. The
Board of Directors currently consists of ten (10) persons. Each person named
below is now a director of BIW Limited. All nominees have consented to be named
and have indicated their intent to serve if elected. BIW Limited has no reason
to believe that any of the nominees will be unable to serve or that any vacancy
on the Board of Directors will occur. In the event any of these nominees is
unable to serve as a director, the shares represented by the proxy will be voted
for the person, if any, who is designated by the Board of Directors to replace
the nominee.
The nominees, their ages, the year in which each first became a director
and their principal occupations or employment during the past five years are as
follows:
Year First Principal Occupation
Nominee Age Became Director During the Past Five Years
- ------- --- --------------- --------------------------
Michael J. Adanti 64 2000 President/CEO Monetary Funding
Group, President Emeritus,
Southern Connecticut State
University, since 1984.
Mary Jane Burt 50 2000 Associate, H. Pearce, Real Estate
Company; Principal, The Laurel
Group (Business Consultants)
since 1998. Previously Director,
INSITE ONE (1999-2002); President,
Burt Medical Lab (1984-1998).
James E. Cohen 58 1982 Lawyer in private practice in
Derby, CT since 1971;
Attorney Trial Referee for the
Connecticut Superior Court since
1996.
Betsy Henley-Cohn 51 1981 Chairwoman of the Board of
Directors of the Company since
1992; Chairperson/Treasurer,
Joseph Cohn & Sons, Inc.
(construction subcontractors)
since 1979; Director, UIL Holdings
Corporation, since 1990; Director,
Aristotle Corp. (1995-2002);
Director, Citizens Bank of
Connecticut (1997-1999).
Juri Henley-Cohn* 27 2004 Johnson Point Productions;
Writer; Producer; Graduate of
Harvard University.
Alvaro da Silva 58 1997 President, DSA Corp. (a management
company) since 1979; President
B.I.D., Inc. (land development and
home building company); Managing
Partner, Connecticut Commercial
Investors, LLC (a commercial real
estate and investment partnership)
since 1976; Director of Great
Country Bank (1991-1995).
Themis Klarides 39 2001 Lawyer in practice in Shelton, CT
since 1998; State Representative,
114 District Connecticut General
Assembly, since 1998.
B. Lance Sauerteig 59 1996 Principal in BLS Strategic Capital,
Inc. (financial and investment
advisory company) since 1994;
Principal in Tortoise Capital
Partners, LLC (real estate
investments) since 2000; Director,
Chemworth, Inc. since 2003;
Director, United Aluminum
Corporation since 2002.
Kenneth E. Schaible 62 1994 Real Estate Developer and Director
of AuthX, Inc.; previously, Senior
Vice President, Webster Bank
(1995-1996); President, Shelton
Savings Bank and Shelton Bancorp.,
Inc. (1972-1995).
John S. Tomac 50 1999 President of Company since October
1, 1998; Treasurer of the Company
since December 1997; previously,
Vice President of Company (December
1, 1997-September 30, 1998);
Assistant Controller, BHC Company
(1991-1997).
* Mr. Henley-Cohn is the son of Ms. Henley-Cohn, the Chairwoman of the Board and
Chief Executive Officer of BIW Limited.
INFORMATION REGARDING BOARD OF DIRECTORS
BIW Limited became the holding company for Birmingham Utilities, Inc. in
June 2002. Where the context requires in this proxy statement, references to
"the Company" or "us" with respect to events prior to June 2002 refer to our
current subsidiary, Birmingham Utilities, Inc.
The Board of Directors' Executive Committee consists of Ms. Henley-Cohn and
Messrs. Tomac, Cohen and Sauerteig. The Executive Committee met six times in
2003. The Executive Committee reviews strategic planning alternatives and
advises the Board of Directors on financial policy, issuance of securities and
other high priority issues.
The Board of Directors' Audit Committee consists of Messrs. Schaible, da
Silva, Adanti and Ms. Burt. The Audit Committee met four times in 2003. The
Audit Committee is directly responsible for the appointment, compensation and
oversight of the independent auditors and reviews the degree of their
independence; approves the scope of the audit engagement, including the cost of
the audit; approves any non-audit services rendered by the auditors and the fees
therefor; reviews with the auditors and management
our policies and procedures with respect to internal accounting and financial
controls and, upon completion of an audit, the results of the audit engagement;
and reviews internal accounting and auditing procedures with our financial staff
and the extent to which recommendations made by the independent auditors have
been implemented. Mr. Schaible is an "audit committee financial expert" as that
term is defined in the regulations of the Securities and Exchange Commission.
All members of the Audit Committee are independent as defined in the listing
standards of the American Stock Exchange. On March 25, 2004, the Board of
Directors amended its Audit Committee Charter to meet the current requirements
of the Securities and Exchange Commission and the American Stock Exchange; the
charter is attached to this Proxy Statement as Exhibit A.
The Board of Directors' Personnel and Pension Committee consists of Messrs.
Sauerteig and Adanti, Ms. Burt and Ms. Klarides. The Personnel and Pension
Committee met five times in 2003. The Personnel and Pension Committee reviews
executive officer compensation and proposes the same to the full Board of
Directors for action. It also proposes to the full Board overall payroll pool
levels and pension plan arrangements for all employees.
The Committee on Directors consists of Messrs. Cohen, da Silva and
Schaible. The committee met once in 2003. That Committee makes recommendations
to the Board of Directors for Board replacements when they become available and
for compensation levels for the Board of Directors. On March 25, 2004, Ms.
Henley-Cohen was removed from the committee after the Board of Directors
determined that she is not independent under the listing standards of the
American Stock Exchange. Effective March 25, 2004, all members of the Committee
on Directors are independent as defined in the listing standards of the American
Stock Exchange. The Committee has a charter which is available on BIW Limited's
website, www.buiweb.com. The Committee on Directors does not set specific,
minimum qualifications that nominees must meet in order for the committee to
recommend them to the Board of Directors, but rather believes that each nominee
should be evaluated based on his or her individual merits, taking into account
the needs of BIW Limited and the composition of the Board of Directors. Members
of the Committee on Directors discuss and evaluate possible candidates in
detail, and suggest individuals to explore in more depth. Once a candidate is
identified whom the committee wants to seriously consider and move toward
nomination, the Chairman of the Committee on Directors enters into a discussion
with that nominee. The Committee on Directors will consider nominees recommended
by stockholders. The policy adopted by the Committee on Directors provides that
nominees recommended by stockholders are given appropriate consideration in the
same manner as other nominees. Stockholders who wish to submit nominees for
director for consideration by the Committee on Directors for election at our
2005 Annual Meeting of stockholders may do so by submitting in writing the names
of such nominees with their qualifications and biographical information
forwarded to the Committee in care of the corporate Secretary of BIW Limited
between December 1, 2004 and December 31, 2004. Mr. Henley-Cohn, the only
nominee who is not already serving as a director, was brought to the attention
of the Committee on Directors by Ms. Henley-Cohn, the Chairwoman of the Board
and Chief Executive Officer of BIW Limited.
In 2003 the Board of Directors held seven meetings. Each director, other
than Mr. Aldore J. Rivers, attended at least 75% of the aggregate number of
meetings of the full Board of Directors and any Committee(s) of the Board of
Directors on which such director served during 2003. We are deeply saddened to
report that Mr. Rivers passed away during 2003, "Al" served BIW Limited with
distinction for 18 years as a director and was a member of the Executive
Committee and the Personnel and Pension Committee at the time of his death.
COMPENSATION OF DIRECTORS
The Company's directors, other than Ms. Henley-Cohn, Mr. Tomac and Mr.
Rivers, received an annual fee of $5,000, plus $600 for each full Board meeting
attended in 2003 and $500 for each Committee meeting attended in 2003. Ms.
Henley-Cohn, Mr. Tomac and Mr. Rivers received no separate compensation for
their service as directors.
COMMUNICATIONS WITH DIRECTORS
In order to provide our stockholders and other interested parties with a
direct and open line of communication to the Board of Directors, the Board of
Directors has adopted the following procedures for communications to directors.
BIW Limited's stockholders and other interested persons may communicate with the
non-management directors of the Company by sending an e-mail to the corporate
Secretary at hvitale@buwater.com. Communications may also be sent by mail
addressed in care of the corporate Secretary, BIW Limited, 230 Beaver Street,
Ansonia, Connecticut 06401.
All communications received in accordance with these procedures will be
reviewed initially by our corporate Secretary. The Secretary will relay all such
communications to the appropriate director or directors unless the Secretary
determines that the communication:
- not relate to the business or affairs of BIW Limited or the
functioning or constitution of the Board of Directors or any of its
committees;
- relates to routine or insignificant matters that do not warrant the
attention of the Board of Directors;
- is an advertisement or other commercial solicitation or communication;
- is frivolous or offensive; or
- is otherwise not appropriate for delivery to directors.
The director or directors who receive any such communication will have
discretion to determine whether the subject matter of the communication should
be brought to the attention of the full Board of Directors or on or more of its
committees and whether any response to the person sending the communication is
appropriate. Any such response will be made only in accordance with applicable
law and regulations relating to the disclosure of information.
Our Secretary will retain copies of all communications received pursuant to
these procedures for a period of at least one year. The Committee on Directors
of the Board of
Directors will review the effectiveness of these procedures from time to time
and, if appropriate, recommend changes.
We have not established a formal policy regarding director attendance at
our annual meetings of stockholders, but our directors generally do attend the
annual meeting. The Chairman of the Board presides at the annual meeting of
stockholders, and the Board of Directors holds one of its regular meetings in
conjunction with the annual meeting of shareholders. Eight of the ten members of
the Board at the time of the Company's 2003 annual meeting of stockholders
attended that meeting.
CODE OF ETHICS
Our Board of Directors has approved a Code of Ethics in accordance with the
rules of the Securities and Exchange Commission and the American Stock Exchange
that governs the conduct of each of our employees and directors, including our
principal executive officer, principal financial officer, principal accounting
officer and controller. Our Code of Ethics is maintained on our website at
www.buiweb.com.
VOTE REQUIRED
Assuming that a quorum is present, the nominees receiving the affirmative
vote of holders of a majority of the shares of common stock issued, outstanding
and entitled to vote, present or represented at the meeting, shall be elected as
directors. Broker non-votes with respect to this matter will be treated as
neither a vote "for" nor a vote "against" the matter, although they will be
counted in determining if a quorum is present. However, instructions on the
accompanying proxy card to withhold authority to vote for one or more nominees
will be considered in determining the number of votes required to attain a
majority of the shares present or represented at the meeting and entitled to
vote. Accordingly, an instruction to withhold authority by a stockholder present
in person or by proxy at the meeting has the same legal effect as a vote
"against" the nominee because it represents a share present or represented at
the meeting and entitled to vote, thereby increasing the number of affirmative
votes required to approve the nominee.
THE BOARD OF DIRECTORS DEEMS "PROPOSAL NO. 1 - ELECTION OF DIRECTORS" TO BE
IN THE BEST INTERESTS OF BIW LIMITED AND ITS STOCKHOLDERS AND RECOMMENDS A VOTE
"FOR" APPROVAL OF THIS PROPOSAL.
EXECUTIVE COMPENSATION
RETIREMENT PLAN
Birmingham Utilities, Inc., a wholly-owned subsidiary of the Company, has a
noncontributory defined benefit plan, which covers substantially all employees.
The retirement plan generally provides a retirement benefit based upon the
participant's years of credited service and his or her final average earnings,
with final average earnings consisting of the total compensation (including
salary, bonus and overtime earnings) of the participant during the five years of
highest total compensation of the participant in the 10 years preceding the
participant's retirement or termination date. Retirement benefits
are payable either as a straight life annuity, a joint and survivor annuity or
in other optional forms. Normal retirement is at age 65, but certain early
retirement benefits may be payable to participants who have attained age 55 and
completed 10 years of continuous service, and survivor benefits may be payable
to the surviving spouse of a vested participant who dies prior to early or
normal retirement. A participant's benefit under the retirement plan vests after
five years of credited service, all benefits funded by Birmingham Utilities,
Inc. are based upon actuarial computations, and no contributions are made by
participants.
The following table shows estimated annual benefits payable under the plan
to participants in specified compensation (final average earnings) and
years-of-service classifications on a straight life annuity basis, assuming
normal retirement at age 65 in 2003. The benefits listed in the following table
are not subject to any deduction for social security or other offset amounts.
YEARS OF SERVICE (B)
FINAL AVERAGE
EARNINGS (A) 15 20 25 30 35
125,000 24,375 32,500 40,625 48,750 56,875
150,000 29,250 39,000 48,750 58,500 68,250
175,000 34,125 45,500 56,875 68,250 79,625
200,000 39,000 52,000 65,000 78,000 91,000
(a) The current final average earnings as of December 31, 2003 for Betsy
Henley-Cohn and John S. Tomac are $74,622 and $134,166, respectively.
(b) Years of credited service under the retirement plan as of December 31, 2003
for Betsy Henley-Cohn and John S. Tomac are 10 and 6, respectively.
EMPLOYMENT CONTRACTS
John S. Tomac
-------------
Effective October 1, 1998, we entered into an employment agreement with our
President, John S. Tomac. The agreement has a three-year term with automatic
three-year extensions, unless either party gives written notice that the
agreement will no longer be automatically extended. No notice was given in 2001
and this agreement was extended to September 30, 2004. The employment agreement
terminates upon the death of Mr. Tomac or upon mutual agreement of the parties.
The agreement can be terminated by us: (i) for "cause" (as defined in the
employment agreement), (ii) in the event Mr. Tomac becomes disabled, or (iii)
without cause, during a six month period during each term; provided however,
that if Mr. Tomac is terminated without cause during such six month period, he
is entitled to receive a severance package equal to his base salary plus
benefits for one year from the date of such termination. Mr. Tomac may terminate
the agreement in the event of a Change of Control (as defined in the employment
agreement) or in the event that we breach this agreement. If Mr. Tomac elects to
terminate the agreement upon a Change of Control, he will be entitled to receive
a lump sum payment, payable within
90 days of making the election, equal to two times the greater of (x) his
compensation during the last full fiscal year immediately preceding the election
and (y) his average annual compensation with respect to the two most recent
fiscal years preceding such election. Mr. Tomac's compensation for purposes of
the foregoing calculation includes base salary, bonus and any other cash
incentives paid to him. If Mr. Tomac does not elect to terminate the agreement
upon a Change of Control, the agreement will continue in effect for a period of
three years from the Change of Control and then terminate.
The employment agreement provides for an annual salary of $100,000 and
provides that the Board of Directors shall review Mr. Tomac's salary annually.
In addition, we agree to provide an automobile for Mr. Tomac and pay all
expenses in connection with the operation of the vehicle. Pursuant to the
employment agreement, Mr. Tomac is entitled to four weeks paid vacation, to be
taken each year and is also entitled to participate in any employee welfare and
retirement plan or program available generally to our employees including
hospital, medical and dental benefits.
Under the employment agreement, we agree to indemnify Mr. Tomac to the
fullest extent permissible under Connecticut law against all costs, charges and
expenses incurred by him in connection with any action, suit or proceeding to
which he may be made a party by reason of his being or having been a director,
officer or employee of the Company or his serving or having served any other
enterprise as a director, officer or employee at the request of the Company. In
addition, Mr. Tomac is entitled to the protection of any insurance policies the
Company may elect to maintain generally for the benefit of its directors and
officers with respect to such costs, charges and expenses.
EXECUTIVE OFFICERS: ANNUAL AND LONG-TERM EXECUTIVE COMPENSATION
The following table sets forth the annual and long-term compensation paid
or accrued by the Company to those persons who were the Chief Executive Officer
and the executive officers of the Company at the end of 2003 whose total annual
salary exceeded $100,000 (collectively, the "Named Executive Officers"), for
services rendered by them in all capacities in which they served the Company
during 2001, 2002 and 2003. The following table does not contain a column for
"Other Annual Compensation" because the amount of perquisites and other personal
benefits received by the Named Executive Officers was less than the lesser of
$50,000 or 10% of the total salary and bonus reported for each person.
SUMMARY COMPENSATION TABLE
ANNUAL COMPENSATION
----------------------------
NAME AND PRINCIPAL POSITION YEAR SALARY ($) BONUS
- --------------------------- ---- ---------- -------
John S. Tomac 2003 $138,567 $19,613
President and Treasurer 2002 $133,233 $ 500
2001 $116,600 $39,613
Betsy Henley-Cohn 2003 $ 76,490 $15,000
Chairman of the Board 2002 $ 72,509 $ 0
and Chief Executive Officer 2001 $ 67,100 $20,000
No grants of stock options were made during the year ended December 31,
2003 to the Named Executive Officers.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR-END OPTION VALUES
Number of Securities Value of Unexercised In-
Underlying Unexercised Options The-Money Options at
Shares Value at Fiscal Year-End (#) Fiscal Year-End ($)(a)
Acquired On Realized -------------------------- --------------------------
Name Exercise (#) ($) Exercisable Unexercisable Exercisable Unexercisable
- ----------------- ----------- -------- ----------- ------------- ----------- -------------
John. S. Tomac 0 -- 13,918 0 $136,537 --
Betsy Henley-Cohn 0 -- 0 0 -- --
(a) Computed based upon the difference between the closing price of BIW Limited
common stock on December 31, 2003 ($19.10) and the exercise price.
PERSONNEL AND PENSION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Board of Directors' Personnel and Pension Committee is comprised of
four independent, non-employee directors. The Personnel and Pension Committee
consists of Messrs. Sauerteig, and Adanti, Ms. Burt and Ms. Klarides. As members
of the Personnel and Pension Committee, it is our responsibility to administer
BIW Limited's executive compensation programs, monitor corporate performance and
its relationship to compensation of executive officers, and make appropriate
recommendations concerning matters of executive compensation.
Compensation Policies
---------------------
We have formulated a compensation philosophy that is designed to enable us
to attract, retain and reward capable employees who can contribute to the
success of the Company. Four key principles serve as the guiding framework for
compensation decisions for all employees of the Company:
o To attract and retain the most highly qualified management and employee
team.
o To pay competitively compared to similar water utility companies.
o To motivate senior executives to achieve annual and long-term business
goals by providing equity-based incentive opportunities.
o To strive for fairness in administration by emphasizing performance -
related measures as the basis of pay decisions.
To implement these policies, we have designed the framework for a
three-part executive compensation program consisting of base salary, long-term
incentive opportunities for senior management, and other employment benefits.
BASE SALARY. We will seek to maintain levels of compensation that are
competitive with similar water utility companies. Our philosophy regarding base
salaries is conservative, and will seek to maintain salaries for the aggregate
officer group at approximately the competitive industry average. Periodic
increases in base salary will relate to individual contributions evaluated
against established objectives, length of service, and the industry's pay
practices. We have determined that the base salary for 2003 for our Chief
Executive Officer and for the other executive officers was generally at or below
the competitive industry average.
LONG TERM INCENTIVES. We believe that a compensation program should provide
executives with an opportunity to increase their ownership in the Company and
gain financially from its stock price increases. Therefore, Company executives
are eligible to receive stock options, giving them the right to purchase shares
of common stock at a specified price in the future. We believe that the use of
stock options as the basis for long-term incentive compensation meets our
defined compensation strategy and business needs by retaining key employees and
aligning their interests with those of stockholders.
OTHER BENEFITS. Our philosophy is to provide competitive health- and
welfare-oriented benefits to executives and employees, but to maintain a
conservative posture relative to executive benefits. Consistent with industry
practices, we provide a company automobile to certain executive officers.
Compliance With Section 162(m) of the Internal Revenue Code
-----------------------------------------------------------
Section 162(m) of the Internal Revenue Code generally disallows a tax
deduction to a public corporation for compensation over $1 million paid to a
corporation's chief executive officer and the four other most highly compensated
executive officers. Qualifying performance-based compensation will not be
subject to the cap if certain requirements are met.
We intend to structure the compensation of our executive officers in a
manner that should ensure that the Company does not lose any tax deductions
because of the $1 million compensation limit. The salaries for our highest paid
executives are established based on independent studies, at levels approximating
the average for companies of comparable size in similar industries and are not
expected to approach $1 million in the foreseeable future.
2003 Compensation for the Chief Executive Officer
-------------------------------------------------
In 2003, Betsy Henley-Cohn received an annual base salary of $76,490. Ms.
Henley-Cohn's base salary and bonus are set below the industry average on
account of her significant equity ownership in BIW Limited. Her annual salary
was nonetheless increased in 2003 in response to her contributions to the
Company's performance. Total compensation for each executive depends upon the
executive's experience level and scope of responsibility within the company as
well as individual performance. No option or restricted stock grants were made
to Ms. Henley-Cohn in 2003, since the Committee believed that the level of her
existing equity ownership aligned her interests with those of the Company's
other stockholders.
Summary
-------
The Board of Directors' Personnel and Pension Committee believes that we
have implemented a comprehensive compensation program for Company executives
that is appropriate and competitive with the total compensation programs
provided by other similar water utility companies with which we compete. We
believe our compensation philosophy ties compensation to stockholder returns and
thereby links compensation to the achievement of annual and longer-term
operational results of the Company on behalf of our stockholders. We look
forward to providing the stockholders with an update in our next annual report
to you.
Personnel and Pension Committee
of the Board of Directors
- B. Lance Sauerteig
- Michael J. Adanti
- Themis Klarides
- Mary Jane Burt
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires our executive
officers and directors, and persons who beneficially own more than ten percent
of our common stock, to file initial reports of ownership and reports of changes
in ownership with the SEC and the American Stock Exchange. Executive officers,
directors, and persons who beneficially own more than ten percent of our common
stock, are required by the SEC to furnish us with copies of all Section 16(a)
forms they file.
Based upon a review of the copies of these forms furnished to us and written
representations from our executive officers and directors, we believe that
during fiscal 2003 all executive officers, directors, and persons who
beneficially own more than ten percent of our common stock, complied with
Section 16(a) filing requirements, except that Ms. Klarides, Ms. Burt and Mr.
Adanti each filed one report in an untimely manner.
COMPANY PERFORMANCE
The following graph shows the cumulative total stockholder return on our
common stock since January 1, 1999, compared to the returns of the American
Stock Exchange Market Index, and the reporting companies in SIC Code 4941 -
Water Supply Companies.
GRAPH
FISCAL YEAR ENDED
----------------------------------------------------------------------
COMPANY/MARKET/INDEX 12/31/1998 12/31/1999 12/31/2000 12/31/2001 12/29/2002 12/31/2003
- -------------------- ---------- ---------- ---------- ---------- ---------- ----------
BIW Limited 100.00 185.16 104.36 163.44 164.43 176.86
Water Supply 100.00 99.25 120.26 155.29 10.59 137.52
AMEX Market Index 100.00 124.67 123.14 117.47 12.78 153.50
STOCK OWNERSHIP
PRINCIPAL STOCKHOLDERS
The following tables set forth information as of March 17, 2004 with
respect to the only persons known to us to be the beneficial owners (for
purposes of the rules of the SEC) of more than 5% of the outstanding shares of
our common stock as of that date.
Name and Address of Amount and Nature of
Beneficial Owners Beneficial Ownership Percent of Class
- ----------------- -------------------- ----------------
Group consisting of Betsy Henley-Cohn,
Cohn Realty & Investment, Betsy Cohn
Spray Trust and Betsy Cohn Income Trust,
80 Hamilton Street, New Haven,
Connecticut 06511 213,824 (1) 13.16 %
(1) Of the 213,824 shares owned by this Group, Betsy Henley-Cohn owns 20,000
shares directly; Cohn Realty & Investment (a Connecticut general partnership
consisting of three investment trusts whose managing agent is Betsy Henley-Cohn,
whose beneficiaries are certain members of the Cohn Family and whose Trustees
are Rhoda Cohn and Stanley Bergman) has beneficial ownership of 68,300 shares;
William Swift, as custodian for Jesse Henley-Cohn, has beneficial ownership of
45,028 shares; Betsy Cohn Spray Trust has beneficial ownership of 59,176 shares;
Betsy Cohn Income Trust has beneficial ownership of 21,320 shares; Betsy
Henley-Cohn has either a controlling or a beneficial interest in Cohn Realty &
Investment, Betsy Cohn Spray Trust and Betsy Cohn Income Trust. No member of the
Group owns or has the right to acquire, directly or indirectly, any other
shares. Unless otherwise indicated, the named beneficial owner of the shares has
sole voting and dispositive power with respect thereto.
The following table sets forth information as of March 17, 2004 with
respect to shares of BIW Limited common stock beneficially owned (for the
purpose of the rules of the SEC) by the Company's executive officers, directors
and nominees.
Common Shares Beneficially Owned
Name As of March 17, 2004 (1) Percent of Class (2)
- ---- ------------------------ --------------------
Michael J. Adanti 12,400 *
Mary Jane Burt 14,482 *
James E. Cohen 80,296 (3) 4.91%
Betsy Henley-Cohn 213,824 (4) 13.16%
Juri Henley-Cohn 20,374 (5) 1.25%
Alvaro da Silva 15,200 *
Themis Klarides 3,950 *
B. Lance Sauerteig 10,400 *
Kenneth E. Schaible 12,960 *
John S. Tomac 17,630 1.08%
Executive Officers,
Directors and
Nominees as a group,
10 in number 401,516 24.71%
* Less than 1%
(1) Includes options to purchase shares of common stock exercisable within 60
days of March 10, 2004, as follows: Mr. Cohen, 10,000; Mr. da Silva, 10,000; Mr.
Sauerteig, 10,000; Mr. Schaible, 10,000; Ms. Burt, 6,250; Mr. Adanti, 6,250; Ms.
Klarides, 3,750 and Mr. Tomac 13,918.
(2) For the purpose of calculating the percentage of common stock beneficially
owned (a) by the individual persons listed in the table, the number of options
held by such person is included in both the number of shares beneficially owned
by the person and in the total number of shares outstanding in the class with
respect to the individual person's percentage calculation, and (b) by the
directors and officers as a group, the total
number of shares beneficially owned by the group and the total number of shares
outstanding includes the 70,168 shares issuable upon the exercise of options
exercisable by all persons in the group within 60 days of the record date.
(3) Includes 64,696 shares held by Mr. Cohen as Trustee for the David B. Cohen
Family Trust, and 3,600 shares held in a brokerage custodial account for Mr.
Cohen's benefit.
(4) Ms. Henley-Cohn is a member of the shareholder group described in the
preceding table. The 213,824 shares set forth in this table is the aggregate
number of shares held by all of the members of the group. See note (1) to the
preceding table for information concerning shares beneficially held by Ms.
Henley-Cohn.
(5) In addition to the 20,374 shares held by him directly, Mr. Henley-Cohn is
one of the beneficiaries of (i) the trusts held by Cohn Realty & Investment
which has beneficial ownership of 68,300 shares, (ii) the Betsy Cohn Spray Trust
which has beneficial ownership of 59,176 shares, and (iii) the Betsy Cohn Income
Trust which has beneficial ownership of 21,320 shares. Mr. Henley-Cohn however,
does not have either voting or dispositive power with respect to any such
shares.
PROPOSAL NO. 2 - RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
The Board of Directors has selected Dworken, Hillman, LaMorte & Sterczala,
P.C. as BIW Limited's independent auditors for the year ending December 31,
2004, and has directed that management submit the selection of independent
auditors for ratification by stockholders at the annual meeting. Representatives
of Dworken, Hillman, LaMorte & Sterczala, P.C. will be present at the Annual
Meeting to respond to questions of shareholders, but, although they have been
offered the opportunity to do so, they do not otherwise propose to make any
statement.
Stockholder ratification of the selection of Dworken, Hillman, LaMorte &
Sterczala, P.C. as BIW Limited's independent auditors is not required by our
Bylaws or otherwise. However, the Board is submitting the selection of Dworken,
Hillman, LaMorte & Sterczala, P.C. to the stockholders for ratification as a
matter of good corporate practice. If the stockholders fail to ratify the
selection, the Board will reconsider the selection of that firm. The Board in
its discretion may direct the appointment of a different independent accounting
firm at any time during the year if the Board determines that such a change
would be in the best interests of BIW Limited and its stockholders.
VOTE REQUIRED
Assuming a quorum is present, the affirmative vote of holders of a majority
of the shares of common stock issued, outstanding and entitled to vote, present
or represented at the meeting, is required for the adoption of this proposal.
Broker non-votes with respect to this matter will be treated as neither a vote
"for" nor a vote "against" the matter,
although they will be counted in determining if a quorum is present. However,
abstentions will be considered in determining the number of votes required to
attain a majority of the shares present or represented at the meeting and
entitled to vote. Accordingly, an abstention from voting by a stockholder
present in person or by proxy at the meeting has the same legal effect as a vote
"against" the matter because it represents a share present or represented at the
meeting and entitled to vote, thereby increasing the number of affirmative votes
required to approve this proposal.
THE BOARD OF DIRECTORS DEEMS "PROPOSAL NO. 2 - RATIFICATION OF SELECTION
OF INDEPENDENT AUDITORS" TO BE IN THE BEST INTERESTS OF BIW LIMITED
AND ITS STOCKHOLDERS AND RECOMMENDS A VOTE "FOR" APPROVAL OF THIS PROPOSAL.
AUDITOR MATTERS
REPORT OF THE AUDIT COMMITTEE
The Audit Committee reviews BIW Limited's financial reporting process on
behalf of the Board of Directors. Management has the primary responsibility for
the financial statements and the reporting process. BIW Limited's independent
auditors are responsible for expressing an opinion on the conformity of our
audited financial statements to generally accepted accounting principles.
In this context, the Audit Committee has reviewed and discussed with
management and the independent auditors, the audited financial statements for
the fiscal year ended December 31, 2003. The Audit Committee has discussed with
the independent auditors the matters required to be discussed by Statement on
Auditing Standards No. 61 (Communication with Audit Committees). In addition,
the Audit Committee has received from the independent auditors the written
disclosures required by Independence Standards Board No. 1 (Independence
Discussions with Audit Committees) and discussed with them their independence
from BIW Limited and its management. The Audit Committee has also considered
whether the provision of non-audit services to BIW Limited by its independent
auditors is compatible with the auditor's independence.
In reliance on the reviews and discussions referred to above, the Audit
Committee recommended to the Board of Directors, and the Board has approved,
that the audited financial statements for the fiscal year ended December 31,
2003 be included for filing in the Company's annual report on SEC Form 10-K for
the year ended December 31, 2003.
Audit Committee of the Board of Directors
- Kenneth E. Schaible
- Alvaro da Silva
- Mary Jane Burt
- Michael J. Adanti
AUDIT FEES
The aggregate fees billed to BIW Limited by our auditors Dworken, Hillman,
LaMorte & Sterczala, P.C. for professional services rendered in connection with
the audit of our annual financial statements for the 2002 and 2003 fiscal years
and the reviews of the interim financial statements included in our Quarterly
Reports on Form 10-Q for such years were $71,200 and $80,800, respectively.
TAX FEES
The aggregate fees billed to BIW Limited for tax-related services in 2002
and 2003 by our auditors Dworken, Hillman, LaMorte & Sterczala, P.C. were $8,300
and $13,700, respectively.
ALL OTHER FEES
The aggregate fees billed to BIW Limited for professional services rendered
in 2002 and 2003 by our auditors Dworken, Hillman, LaMorte & Sterczala, P.C.
other than for services specifically described above, were $22,400 and $27,400,
respectively. During 2003, these services consisted of an audit of operations of
an acquisition target. During 2002, services were performed in connection with
the filing of a registration statement with the Securities and Exchange
Commission in connection with the formation of BIW Limited.
After review and discussion, the Audit Committee has concluded that
Dworken, Hillman, LaMorte & Sterczala, P.C. provision of non-audit services to
BIW Limited is compatible with maintaining Dworken, Hillman, LaMorte &
Sterczala, P.C. auditor independence. The committee has adopted a policy
requiring pre-approval by the committee before Dworken, Hillman, LaMorte &
Sterczala, P.C. is engaged for any non-audit services.
STOCKHOLDER PROPOSALS
All stockholder proposals which are intended to be presented at the 2005
annual meeting of stockholders must be received by us no later than December 10,
2004 for inclusion in the Company's proxy statement and form of proxy relating
to that meeting.
OTHER BUSINESS
The Board of Directors knows of no other business to be acted upon at the
annual meeting. However, if any other business properly comes before the annual
meeting, it is the intention of the persons named in the enclosed proxy to vote
on such matters in accordance with their best judgment.
Our annual report, including financial statements, for the year 2003 is
enclosed with this proxy mailing but is not a part of the proxy soliciting
material.
The prompt return of your proxy card will be appreciated and helpful in
obtaining the necessary vote. Therefore, whether or not you expect to attend the
annual meeting, please sign the proxy and return it in the enclosed envelope.
By Order of the Board of Directors
John S. Tomac
President
Ansonia, Connecticut
April 8, 2004
EXHIBIT A
---------
BIW LIMITED
AUDIT COMMITTEE OF THE BOARD OF DIRECTORS
CHARTER
Amended and Restated - 3/25/04
I. PURPOSE
The primary function of the Audit Committee is to assist the Board of
Directors ("Board") of BIW Limited (the "Corporation") in fulfilling its
oversight responsibilities with respect to financial reporting and the other
matters listed below. The Audit Committee's primary duties and responsibilities
are to:
o Assist with Board oversight of the integrity of the Corporation's financial
statements.
o Assist with Board oversight of the Corporation's compliance with legal and
regulatory requirements, including monitoring the integrity of the
Corporation's reporting standards and systems of internal controls
regarding finance, accounting and legal matters.
o Select independent external auditors to conduct the annual audit.
o Monitor the qualifications, independence, performance and scope of
examination of the Corporation's independent external auditors.
o Monitor the performance of the Corporation's internal audit function.
o Provide an avenue of communication among the Corporation's independent
external auditors, management and the Board.
o Review the quarterly and annual financial statements and the annual audit
report.
o Annually prepare a report for inclusion in the Corporation's proxy
statement, in a ccordance with applicable rules and regulations.
The Corporation's independent external auditors should promptly consult
with the Chair of the Audit Committee if, at any time, any material concern or
matter arises which has not been promptly or appropriately addressed by the
management of the Corporation or which involves any illegal act or conflict of
interest or self-dealing on the part of the Corporation's senior management.
The Corporation's independent external auditors are directly accountable to
the Audit Committee. The Audit Committee has the authority to conduct any
investigation appropriate to fulfill its responsibilities and has direct access
to the independent external auditors as well as any officer or employee of the
Corporation.
The Audit Committee will primarily fulfill its responsibilities by carrying
out the activities enumerated in Section IV of this Charter. While the Audit
Committee has the responsibilities and powers set forth in Section IV, it is not
the duty of the Audit Committee to plan or conduct audits or to determine that
the Company's financial statements are complete and accurate and are in
accordance with generally accepted accounting principles. This is the
responsibility of management and the independent external auditors. Nor is it
the duty of the Audit Committee to conduct investigations, to resolve
disagreements, if any, between management and the independent external auditors
or to assure compliance with laws and regulations and the Company's Code of
Conduct. Members of the Audit Committee shall not be deemed to have accepted a
duty of care that is greater than the duty of the directors generally.
The Chairman of the Board and the Chief Executive Officer of the
Corporation shall provide the Audit Committee with all of the resources, both
internal and external, which the Audit Committee deems necessary or advisable to
meet its duties and responsibilities and carry out its function. Without
limiting the foregoing, the Audit Committee may retain, at the Corporation's
expense and without seeking approval from the Board, such special legal,
accounting or other consultants or experts as it deems necessary in the
performance of its duties. The Audit Committee shall inform an executive officer
of the Corporation promptly of any actions by the Audit Committee, of which an
executive officer of the Corporation is not otherwise aware, that would result
in the commitment or payment of Corporation funds.
II. COMPOSITION
The Audit Committee shall be comprised of three or more directors as
determined by the Board, each of whom shall meet the independence criteria set
forth in Rule 10A-3 of the Securities Exchange Act of 1934 (the "Exchange Act")
and the independence and financial literacy requirements of the American Stock
Exchange. At least one member of the Audit Committee shall be financially
sophisticated as required by the American Stock Exchange.
The members of the Audit Committee shall be elected by the Board at the
annual organizational meeting of the Board and shall serve until their
successors shall be duly elected and qualified. No Audit Committee member may
simultaneously serve on the audit committees of more than three public companies
unless the Board affirmatively determines that such service would not impair the
ability of such member to effectively serve on the Audit Committee. Unless a
Chair is elected by the full Board, the members of the Committee may designate a
Chair by majority vote of the full Audit Committee membership. The Audit
Committee Chair may be rotated among members periodically at the discretion of
the Board. If practicable, the immediate past chair will continue as a member of
the Audit Committee for at least one year to ensure an orderly transition. If an
Audit Committee Chair is not designated or present at a meeting, the members of
the Audit Committee may designate a Chair for such meeting by majority vote.
III. MEETINGS
The Audit Committee shall meet on at least a quarterly basis, or more
frequently as circumstances dictate. The Audit Committee Chair shall prepare
and/or approve an agenda in advance of each meeting. The Chair of the Audit
Committee will regularly report the Audit Committee's findings, conclusions and
recommendations to the Board.
As part of its job to foster open communication, the Audit Committee should
meet at least annually with management and the independent external auditors in
separate executive sessions to discuss any matters that the Audit Committee or
each of these groups believe should be discussed privately. In addition, the
Audit Committee shall meet with the independent external auditors and management
quarterly to review the Corporation financials consistent with Section IV.3.
below.
IV. RESPONSIBILITIES AND DUTIES
To fulfill its responsibilities and duties the Audit Committee shall:
Documents/Reports Review:
-------------------------
1. Submit this Charter to the Board for approval and have the document
published in accordance with regulations of the Securities and Exchange
Commission ("SEC").
2. Review and discuss with management and the independent external auditors,
the Corporation's annual audited financial statements and related
footnotes, quarterly financial statements, and the Corporation's
disclosures in its periodic reports filed under the Exchange Act under
"Management's Discussion and Analysis of Financial Condition and Results of
Operations."
3. Obtain from the independent external auditors assurance that Section 10A of
the Exchange Act has not been implicated.
4. Periodically meet separately with management, with internal auditors (or
other personnel responsible for the internal audit function) and with the
independent external auditors to discuss any matters that the Audit
Committee or each of these groups believe should be discussed.
5. Discuss with management and the independent external auditors any
significant issues regarding accounting principles, practices and judgments
reflected therein prior to any public release, filing or distribution.
6. In consultation with management and the independent external auditors,
consider the integrity of the Corporation's financial reporting processes
and controls. Review significant findings prepared by the independent
external auditors together with management's responses and the status of
management's response to previous recommendations.
7. Review with management and the independent external auditors, the
Corporation's quarterly financial results prior to the public release
thereof and/or the Corporation's quarterly financial statements prior to
any public release, filing or distribution.
8. Discuss generally the types of information to be disclosed in earnings
press releases, as well as the manner of presentation and the types of
financial information and earnings guidance provided to analysts and rating
agencies.
9. Review and discuss any significant changes in the Corporation's accounting
principles and practices and any items required to be communicated by the
independent external auditors in accordance with Statements of Auditing
Standards 61 and 71, as amended from time to time.
10. Review annually the financial and accounting organizational structure,
including the responsibilities, budget and staffing of the Corporation's
internal audit function.
11. Annually prepare a report to shareholders as required by the SEC, to be
included in the Corporation's annual proxy statement.
Independent External Auditors:
- ------------------------------
12. Retain the Corporation's independent external auditors, who shall report
directly to the Audit Committee, and approve any discharge of independent
external auditors when circumstances warrant.
13. Review the qualifications, independence and performance of the independent
external auditors.
14. Review and evaluate the lead audit partner of the independent external
auditors and assure that the lead audit partner is rotated as required by
applicable law.
15. Pre-approve all audit engagement fees and terms, as well as all non-audit
engagements with the independent external auditors. The Audit Committee
shall have sole authority to approve such matters.
16. On at least an annual basis, ensure that the independent external auditors
submit a formal written statement delineating all of their relationships
with the Corporation consistent with Independent Standards Board No. 1.
Review and discuss with the independent external auditors all significant
relationships they have with the Corporation that could impair their
independence and, when warranted, recommend appropriate action to the
Board.
17. Review and discuss the independent external auditors' audit plan with
regard to its scope, staffing, locations, reliance upon management and
general audit approach.
18. Obtain and review, at least annually, a report by the independent external
auditors describing: the firm's internal quality-control procedures; any
material issues raised by the most recent quality-control review, or peer
review, of the firm, or by any inquiry or investigation by governmental or
professional authorities, within the preceding five years, respecting
independent audits carried out by the firm, and any steps taken to deal
with any such issues.
19. Consider and discuss with management the independent external auditors'
judgments about the quality and appropriateness of the Corporation's
accounting principles and underlying estimates used to prepare the
Corporation's financial statements, the clarity of the Corporation's
financial disclosure and whether the Corporation's accounting principles
are common practices or minority practices.
20. Consider whether, in order to assure continuing auditor independence, there
should be regular rotation of the audit firm itself.
21. Monitor hiring practices with respect to employees or former employees of
the Corporation's independent external auditors.
Financial Reporting Processes:
- ------------------------------
22. In consultation with the independent external auditors and the internal
auditors, review the integrity of the organization's financial reporting
processes, both internal and external.
23. Consider the independent external auditors' judgments about the quality and
appropriateness of the Corporation's accounting principles as applied in
its financial reporting. Discussions should include: (1) methods used to
account for significant unusual transactions; (2) the effect of significant
accounting policies in controversial or emerging areas for which there is a
lack of authoritative guidance or consensus; (3) the process used by
management in formulating particularly sensitive accounting estimates and
the basis for the auditor's conclusions regarding the reasonableness of
those estimates; and (4) disagreements with management over the application
of accounting principles, the basis for management's accounting estimates,
and the disclosures in the financial statements.
24. Consider and approve, if appropriate, major changes to the Corporation's
auditing and accounting principles and practices as suggested by the
independent external auditors and management.
25. Review the significant reports to management prepared by the internal
auditing department and management's responses.
Process Improvement:
- --------------------
26. Establish regular and separate systems of reporting to the Audit Committee
by each of management and the independent external auditors regarding any
significant judgments made in management's preparation of the financial
statements and the view of each as to appropriateness of such judgments.
27. Following completion of the annual audit, review separately with each of
management, the independent external auditors and the internal auditing
department any significant difficulties encountered during the course of
the audit, including any restrictions on the scope of work or access to
required information.
28. Review any significant disagreement among management and the independent
external auditors in connection with the preparation of the financial
statements.
29. Review with the independent external auditors and management the extent to
which changes or improvements in financial or accounting practices, as
approved by the Audit Committee, have been implemented. (This review should
be conducted at an appropriate time subsequent to implementation of changes
or improvements, as described by the Audit Committee.)
30. Monitor the Corporation's risk assessment and risk management. Discuss
significant financial risk exposures and the steps management has taken to
monitor, control and report such exposures.
31. Review the appointment and replacement of the senior internal auditing
executive.
Ethical and Legal Compliance:
- -----------------------------
32. Establish, review and update periodically a Code of Ethical Conduct and
ensure that management has established a system to enforce this Code.
33. Review management's monitoring of the Corporation's compliance with the
organization's Ethical Code, and ensure that management has the proper
review system in place to ensure that Corporation's financial statements,
reports and other financial information disseminated to governmental
organizations, and the public satisfy legal requirements.
34. Review corporate policies relating to compliance with laws and regulations,
ethics, conflicts of interest and the investigation of misconduct or fraud.
35. Establish procedures for the receipt, retention and treatment of complaints
received by the Corporation regarding accounting, internal accounting
controls, or auditing matters and the confidential, anonymous submission by
employees of the Corporation of concerns regarding questionable accounting
or auditing matters.
36. Review significant cases of employee conflict of interest, misconduct or
fraud.
37. Review in-house procedures for oversight of officers' expenses and
perquisites.
38. Review, with the Corporation's counsel, legal compliance matters including
corporate securities trading policies.
39. Review, with the Corporation's counsel, any legal matter that could have a
significant impact on the organization's financial statements.
40. On at least an annual basis, meet with the Corporation's management and, if
necessary, the Corporation's outside counsel, to discuss any legal matters
that could have a significant impact on the financial statements, the
Corporation's compliance with applicable laws and regulations, and
inquiries received from regulators or governmental agencies.
41. Perform any other activities consistent with this Charter, the
Corporation's By-laws and governing law, as the Audit Committee or the
Board deems necessary and appropriate.
BIW Limited
230 Beaver Street
Ansonia, CT 06401
This Proxy is Solicited on Behalf of the Board of Directors
For the Annual Meeting of Stockholders to be held on May 11, 2004
The undersigned hereby appoints Betsy Henley-Cohn and John Tomac as proxies,
each with the power to appoint his/her substitute, and hereby authorizes them to
represent and to vote as designated on the reverse side all shares of common
stock of BIW Limited, held of record by the undersigned on March 17, 2004 at the
annual meeting of stockholders to be held on May 11, 2004, or any adjournment
thereof. Any and all proxies heretofore given are hereby revoked.
(Continued and to be signed on other side)
Please date, sign and mail your
Proxy card back as soon as possible!
Annual Meeting of Stockholders
BIW Limited
May 11, 2004
(1) To elect ten directors of the Company to serve for the ensuing year;
(2) To consider and vote on the approval of Dworken, Hillman, LaMorte &
Sterczala, P.C. as the Company's independent auditors for the year
ending December 31, 2004; and
(3) To transact such other business as may properly come before the Annual
Meeting or any adjournment thereof.