Schedule 14A INFORMATION
Information
(Amendment No.
| Filed by the Registrantþ | ||||||||
| Filed by a Party other than the Registranto | ||||||||
| Check the appropriate box: | ||||||||
| o | Preliminary Proxy Statement | |||||||
| o | Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) | |||||||
| þ | Definitive Proxy Statement | |||||||
| o | Definitive Additional Materials | |||||||
| o | Soliciting Material under §240.14a-12 | |||||||
First Busey Corporation | ||||||||
| (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): | ||||||||
| þ | No fee required. | |||||||
| o | $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-b(i)(1), 14a-6(i)(2) or Item 22(a)(2) of Schedule 14A. | |||||||
| o | Fee computed on table below per Exchange Act Rules 14a-6(i)(4) 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: | |||||||
| o | Fee paid previously with preliminary materials. | |||||||
| o | 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: | |||||||
First Busey Corporation
- --------------------------------------------------------------------------------
(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.
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-b(i)(1), 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) 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:
_________________________________________________________________
FIRST BUSEY CORPORATION
201 W. MAIN, URBANA,Main, Urbana, IL 61801
217/365-4556
March 12, 2004
16, 2005
Dear Stockholder:
The Annual Meeting of Stockholders of First Busey Corporation will be held on Tuesday, April 13, 2004,26, 2005, at the Virginia Theatre, 203 West Park,Champaign Country Club, 1211 S. Prospect, Champaign, Illinois. The Annual Meeting will begin at 7:12:00 p.m.noon, central time. At this Annual Meeting you will be asked:
1. To elect seven directors of the Company to serve
until the 2005 Annual Meeting or until their successors are duly
elected and qualified.
2. To approve the First Busey Corporation 2004 Stock
Option Plan.
| 1. | To elect seven directors of the Company to serve until the 2006 Annual Meeting or until their successors are duly elected and qualified. | |||
| 2. | To consider and act upon the proposed Amended and Restated Articles of Incorporation of the Company, which increases the par value of the Company’s capital stock from no par value per share to $.001 par value per share. | |||
| 3. | To transact such other business as may properly come before the Annual Meeting or any postponement or adjournment thereof. | |||
Each of the proposals is more fully described in the accompanying Proxy Statement which I urge you to read carefully. The Board of Directors has unanimously approved and recommends a vote "FOR"“FOR” each of the proposals.
It is important that your shares be represented at the Annual Meeting. Whether or not you attend personally, I urge you to sign, date and return the enclosed proxy at your earliest convenience.
Kindest regards,
Douglas C. Mills
Chairman ofIf you plan on attending the Board
FIRST BUSEY CORPORATION
Annual Meeting Luncheon, please contact Mary Lakey at 217-365-4556 to place your reservation.
| Kindest regards, | ||
| Douglas C. Mills Chairman of the Board |
First Busey Corporation
201 W. MAIN, URBANA,Main, Urbana, IL 61801
217/365-4556
NOTICE OF 2004 ANNUAL MEETING OF STOCKHOLDERS
Notice of 2005 Annual Meeting of Stockholders
To Be Held April 13, 2004
26, 2005
To the Stockholders of
First Busey Corporation:
Notice is hereby given that the Annual Meeting of Stockholders of First Busey Corporation,a Nevada corporation, will be held at the Virginia Theatre,
203 West Park,Champaign Country Club, 1211 S. Prospect, Champaign, Illinois, on Tuesday, April 13, 2004,26, 2005, at 7:12:00 p.m.noon, central time, for the following purposes:
1. To elect seven directors of the Company to serve
until the 2005 Annual Meeting or until their successors are duly
elected and qualified.
2. To approve the First Busey Corporation 2004 Stock
Option Plan.
| 1. | To elect seven directors of the Company to serve until the 2006 Annual Meeting or until their successors are duly elected and qualified. | |||
| 2. | To consider and act upon the proposed Amended and Restated Articles of Incorporation of the Company, which increases the par value of the Company’s capital stock from no par value per share to $.001 par value per share. | |||
| 3. | To transact such other business as may properly come before the Annual Meeting or any postponement or adjournment thereof. | |||
Only stockholders of record at the close of business on February 27,
2004March 1, 2005 shall be entitled to notice of, and to vote at, the Annual Meeting or any postponement or adjournment thereof. Even if you plan to attend the Annual Meeting in person, please sign, date and return your proxy in the enclosed envelope.
By order ofIf you plan on attending the Board of Directors,
Barbara J. Kuhl
President and Chief Operating Officer,
Corporate Secretary and Treasurer
Annual Meeting Luncheon, please contact Mary Lakey at 217-365-4556 to place your reservation.
| By order of the Board of Directors, | ||
| Barbara J. Kuhl | ||
| President and Chief Operating Officer, | ||
| Corporate Secretary and Treasurer |
Urbana, Illinois
March 12, 2004
FIRST BUSEY CORPORATION
16, 2005
First Busey Corporation
201 W. MAIN, URBANA,Main, Urbana, IL 61801
217/365-4556
PROXY STATEMENT
GENERAL
Proxy Statement
General
This Proxy Statement is furnished in connection with the solicitation of proxies by the Board of Directors of First Busey Corporation for use at the Annual Meeting of Stockholders. The Board has fixed the close of business on February 27, 2004,March 1, 2005, as the record date for determining the stockholders entitled to notice of, and to vote at, the Annual Meeting. On the record date, the Company had outstanding and entitled to vote 13,696,90220,577,651 shares of Common Stock, withoutno par value.
The Company'sCompany’s Form 10-K Annual Report, which includes audited financial statements for the year ended December 31, 2003,2004, accompanies this Proxy Statement. The financial statements contained in the Company’s 2004 Annual Report are not deemed material to the exercise of prudent judgment in regard to the matters to be acted upon at the Annual Meeting and, therefore, are not incorporated by reference into this Proxy Statement. The approximate date on which the Proxy Statement and the accompanying proxy are first being sent to stockholders is March 12, 2004.
VOTING
16, 2005.
Voting
General.Shares of Common Stock represented by properly executed proxies received by the Company will be voted at the Annual Meeting in accordance with the instructions on the proxies. If there are no such instructions, the shares will be voted "FOR"“FOR” (i) the election of the nominees for directors named in this Proxy Statement and (ii) the approval of the First
Busey Corporation 2004 Stock Option Plan.Amended and Restated Articles of Incorporation of the Company. Properly executed proxies received by the Company will also be voted at the Annual Meeting in accordance with the Board'sBoard’s recommendations on any other matters which may come before the Annual Meeting.
In order to be elected a director, a nominee must receive a plurality of the votes cast at the meeting for the election of directors. Because the seven nominees receiving the largest number of affirmative votes will be elected, shares represented by proxies which are marked "withhold authority"“withhold authority” or "abstain"“abstain” as to election of directors will have no effect on the outcome of the election. ApprovalThe proposed Amended and Restated Articles of Incorporation of the proposed 2004 Stock Option Plan requires the vote ofCompany must be approved by a majority of the outstanding shares of Common Stock.Stock of the Company. Accordingly, proxies which are marked "abstain"“abstain” as to this matter will be the same as a negative vote on the matter.
Directors and Executive Officers.All of the directors and executive officers of the Company have advised the Company that they will vote their shares of Common Stock "FOR"“FOR” the election of the nominees for directors named in
this Proxy Statementdirector and "FOR"“FOR” the approval of the 2004 Stock Option Plan.Amended and Restated Articles of Incorporation. As of February 27, 2004,1, 2005, these individuals beneficially owned an aggregate of 4,778,2726,563,625 shares, or approximately 34.9%31.8% of the Common Stock outstanding.
REVOCABILITY OF PROXIES
Revocability of Proxies
Stockholders may revoke their proxy by a later proxy or by giving notice of such revocation to the Company in writing or at the Annual Meeting before such proxy is voted. Attendance at the Annual Meeting will not in and of itself constitute the revocation of a proxy.
SOLICITATION
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Solicitation
The Company will pay the cost of solicitation of proxies. In addition to solicitation by mail, officers, directors and regular employees of the Company may solicit proxies by telephone, telefax or in person without additional compensation. Brokerage houses, bank nominees, fiduciaries and other custodians will be requested to forward soliciting material to the beneficial owners of shares held of record by them and will be reimbursed for their reasonable expenses.
PROPOSAL NO.
Proposal No. 1
ELECTION OF DIRECTORS
Election of Directors
The seven nominees named below have been recommended for election as directors for a term of one year or until their successors have been duly elected and qualified.
It is intended that the proxies received in response to this solicitation will be voted for the election of the seven persons so nominated, unless otherwise specified. If, for any reason, any nominee shall become unavailable for election or shall decline to serve, persons named in the proxy may exercise discretionary authority to vote for a substitute proposed by the Board. No circumstances are presently known which would render a nominee named herein unavailable.
Set forth below is certain biographical information concerning each nominee for director, including principal occupation and age as of February 27,
2004,March 1, 2005, the record date for the Annual Meeting. Unless otherwise noted, nominees for director have been employed in their principal occupation with the same organization for at least the last 5 years.
JOSEPH
Joseph M. AMBROSE
Ambrose
Director since: 1993
Age: 46
47
Mr. Ambrose is an attorneya partner with Costigan & Wollrab, P.C., Bloomington, Illinois. Mr. Ambrose was with Ambrose Law Offices, Ltd. Previously,from June 2003 until April 2004. Prior to June 2003, Mr. Ambrose served as Executive Vice President of AFNI, Inc., Bloomington, Illinois from January 1999 until June 2003. Mr. Ambrose is considered "independent"“independent” under the rules of The Nasdaq Stock Market.
E. PHILLIPS KNOX
Phillips Knox
Director since: 1980
Age: 57
58
Mr. Knox is an attorney with the firm Tummelson Bryan & Knox, Urbana, Illinois.
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DAVID
David L. IKENBERRY
Ikenberry
Director since: 2004
Age: 43
44
Mr. Ikenberry has been a Professor of Finance and Department Chair at the University of Illinois-Urbana since June 2002. Previously, Mr. Ikenberry was an Associate Professor at Rice University, Houston, Texas, from 1996-2002. Mr. Ikenberry is considered "independent"“independent” under the rules of Nasdaq.
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V. B. LEISTER, JR.
Leister, Jr.
Director since: 1996
Age: 58
59
Mr. Leister has been Chairman of the Board of Carter'sCarter’s Furniture Inc., Urbana, Illinois, since 2002. Previously, Mr. Leister served as Vice President & Treasurer of Carter'sCarter’s Furniture. Mr. Leister is considered "independent"“independent” under the rules of Nasdaq.
DOUGLAS
Douglas C. MILLS
Mills
Director since: 1980
Age: 63
64
Mr. Mills has served as Chairman of the Board and Chief Executive Officer of First Busey Corporation since its incorporation. He has been associated with Busey Bank since 1971 when he assumed the position of Chairman of the Board.
JOSEPH
Joseph E. O'BRIEN
O’Brien
Director since: 2004
Age: 74
75
Mr. O'BrienO’Brien is Chairman of O'BrienO’Brien Steel Service Co., Peoria, Illinois. Mr. O'BrienO’Brien is considered "independent"“independent” under the rules of Nasdaq.
ARTHUR
Arthur R. WYATT
Wyatt
Director since: 1995
Age: 76
77
Mr. Wyatt is a retired Professor of Accounting at the University of Illinois-Urbana. Mr. Wyatt is considered "independent"“independent” under the rules of Nasdaq.
BOARD OF DIRECTORS
Board of Directors
During 2003,2004, the Board held 1210 meetings. All directors attended at least 75% of the meetings of the Board and the committees on which they served during 2003.2004. The Company's
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nominee'snominee’s intention, at this time, to attend the 20042005 Annual Meeting.
The Board of Directors of the Company has established the following committees, among others, to assist in the discharge of its responsibilities.
EXECUTIVE MANAGEMENT COMPENSATION AND SUCCESSION COMMITTEE
Executive Management Compensation and Succession Committee
The Executive Management Compensation and Succession Committee met threeseven times in 2003.2004. Members of the Compensation Committee in 20032004 were Messrs. WyattAmbrose (Chairman), Samuel BanksLeister and Leister. Mr. Banks replaced Dr. Victor
Feldman on the Committee in June 2003, upon Dr. Feldman's resignation from the
Committee.Wyatt. The responsibilities of this Committee include the approval, and recommendation to the Board of the compensation of the Chief Executive Officer of the Company and the compensation of all other executive officers of the Company. The Committee also reviews and analyzes existing and potential management succession issues. Subject to election of the director nominees named
in this Proxy Statement, the members of the Executive Management Compensation
and Succession Committee are Messrs. Ambrose (Chairman), Leister and Wyatt for
2004. All such members are "independent"“independent” under Nasdaq rules. The Executive
Management Compensation and Succession
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Nominating & Corporate Governance Committee Charter is attached as Annex A.
NOMINATING & CORPORATE GOVERNANCE COMMITTEE
The Nominating & Corporate Governance Committee of the Board of Directors met sixfive times in 2003.2004. The Nominating & Corporate Governance Committee members are Messrs. Wyatt (Chairman), BanksLeister and Leister.O’Brien. The responsibilities of the Nominating & Corporate Governance Committee include the nomination of individuals as members of the Board of Directors, including the review of existing directors'directors’ self-assessments to determine qualifications to stand for re-election, and the implementation and maintenance of corporate governance procedures. Subject to the election of the director nominees named in this Proxy
Statement, the members of the Nominating & Corporate Governance Committee are
Messrs. Wyatt (Chairman), O'Brien and Leister for 2004. All such members are "independent"“independent” under Nasdaq rules. The Nominating & Corporate Governance Committee Charter is attached to this Proxy Statement as Annex B.available at the Company’s website at www.busey.com.
The Nominating & Corporate Governance Committee reviews qualified candidates for directors and focuses on those who present varied, complementary backgrounds that emphasize both business experience and community standing. The Committee also believes that directors should possess the highest personal and professional ethics.
In 2003,2004, the Nominating & Corporate Governance Committee met and reviewed all relevant qualifications of potential director nominees, including, at a minimum, the following:
- independence from management, as defined specifically by the
corporate governance rules of Nasdaq;
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- relevant business experience;
- knowledge of the central Illinois communities in which the
Company predominantly operates;
- potential conflicts of interest; and
- judgment, skill, integrity and reputation.
| • | independence from management, as defined specifically by the corporate governance rules of Nasdaq; | |||
| • | relevant business experience; | |||
| • | knowledge of the central Illinois communities in which the Company predominantly operates; | |||
| • | potential conflicts of interest; and | |||
| • | judgment, skill, integrity and reputation. | |||
The Committee reviews the qualifications of each potential candidate for director and identifies nominees by consensus.
For 2004, the Committee determined to decrease the size of the Board to
both streamline processes and to create a primarily independent Board. All2005, all but two of the director nominees, Messrs. MillsKnox and Knox,Mills, have been determined to be "independent"“independent” by the Board, under Nasdaq rules.
The Committee evaluates all candidates in the same way, reviewing the aforementioned factors, among others, regardless of the source of such candidate, including stockholder recommendation. There is no separate policy with regard to consideration of candidates recommended by stockholders. The Committee did not receive any stockholder recommendations for director nominees for 2004.2005. No third party was retained, in any capacity, to provide assistance in either identifying or evaluating potential director nominees for 2004.
The two director nominees who have been approved by the2005.
Audit Committee who
are not standing for reelection, Messrs. Ikenberry and O'Brien, are each
independent from management.
AUDIT COMMITTEE
The Audit Committee met sixnine times in 2003.2004. Members of the Audit Committee are Messrs. Leister (Chairman), Kenneth Hendren,Ikenberry, and Wyatt. The Audit Committee has at least one audit committee financial expert, Mr. Wyatt. Mr. Wyatt is independent from management of the Company. Subject to the election of
the director nominees named in this Proxy Statement, the members of the Audit
Committee are Messrs. Leister (Chairman), Wyatt and Ikenberry for 2004. All such members are "independent"“independent” under Nasdaq rules and under Rule 10A-3 of the Securities Exchange Act of 1934, as
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required for audit committee membership. The Audit Committee Charter is available at the Company’s website at www.busey.com.
The responsibilities and functions of the Audit Committee and its activities during 20032004 are described in detail under the heading "Report“Report of the Audit Committee" Committee”in this Proxy Statement.
The Audit Committee has adopted procedures for the treatment of complaints or concerns regarding accounting, internal accounting controls or auditing matters. In addition, it has adopted procedures for the review and approval of all related party transactions. The Audit Committee has also implemented pre-approval policies and procedures for all audit and non-audit services. Generally, the Audit Committee requires pre-approval of any services to be provided by the - 5 -
Company'sCompany’s auditors, McGladrey & Pullen, LLP and the Company'sCompany’s tax accountants, RSM McGladrey, Inc., to the Company or any of its affiliates. The pre-approval procedures include the designation of such pre-approval responsibility to one individual on the Audit Committee, currently Mr. Leister.
In 2003,2004, the Audit Committee pre-approved audit services to be rendered by McGladrey & Pullen, LLP in
connection with the Company's audit and the auditswhich consisted of the Company's Employees'
Stock Ownership Plan and Profit Sharing Plan & Trust.
Fees paid to McGladrey & Pullen, LLP and RSM McGladrey, Inc., the
Company's auditors, for services rendered in 2003 and 2002 are as follows:
Fees paid to McGladrey & Pullen, LLP and RSM McGladrey, Inc. were pre-approved by, the audit committee. The Company
did not retain McGladreyCompany’s auditors, for the rendering of any financial information
design-related services rendered in 2003.2004 and 2003 are as follows:
| % of | % of | |||||||||||||||||||||
| Fees | 2004 | Total Fees | 2003 | Total Fees | ||||||||||||||||||
| Audit | $ | 206,500 | 78.7 | % | $ | 126,875 | 69.2 | % | ||||||||||||||
| Audit-related | 27,900 | 10.6 | % | 34,850 | 19.0 | % | ||||||||||||||||
| Tax | 20,925 | 8.0 | % | 20,929 | 11.4 | % | ||||||||||||||||
| All other | 7,000 | 2.7 | % | 805 | * | |||||||||||||||||
Total | $ | 262,325 | $ | 183,459 | ||||||||||||||||||
| * | less than 1% |
The Company has not yet selected an independent auditor for the fiscal year ending December 31, 2004. The Audit Committee is currently engaged in the
process of evaluating qualified independent auditor candidates and determining
which candidate will be retained by the Company.2005. McGladrey & Pullen, LLP served as the Company'sCompany’s independent auditors for the fiscal year ended December 31, 2003.2004. A representative of McGladrey & Pullen, LLP will be present at the Annual Meeting and will have the opportunity to make a statement if he or she desires to do so and will be available to respond to appropriate questions.
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In addition to the committees of the Board of Directors described above, the Company'sCompany’s independent directors met one timethree times in executive session in 20032004 and will meet a minimum of two times in executive session in 2004.2005. Mr. Wyatt, Chairman of the Nominating & Corporate Governance Committee, will presidepresides at these executive sessions.
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Any stockholder who wishes to contact the Board directly may do so by contacting either Mr. Mills or Mr. Leister, (1) in writing, in care of First Busey Corporation, 201 W. Main, Urbana, IL 61801 or (2) electronically, through the hyperlink available at the Company'sCompany’s website at www.busey.com.www.busey.com. All such communications will be forwarded to the entire Board, or only the independent directors, in accordance with instructions provided in such communications.
During 2003,2004, non-employee directors of the Company received a cash retainer of $10,000.$7,500, a 3,000 share stock option and an additional payment of $5,000, except for Mr. Leister, who served as Chairman of the Audit Committee, and received a retainer of $10,000, a 3,000 share stock option and an additional payment of $5,000. Directors who are also employees of the Company or any of its subsidiaries do not receive additional compensation for serving on the Board.
Report of the Audit Committee
In accordance with its written charter adopted by the Board of Directors, the Audit Committee of the Board assists the Board in fulfilling its responsibility for the oversight of the quality and integrity of the accounting, auditing and financial reporting practices of the Company. During the year, the Committee met sixnine times and also reviewed and discussed the interim financial information contained in each quarterly earnings announcement with management and the independent auditors prior to public release. The Amended and Restated
Audit Committee Charter is attached to this Proxy Statement as Annex C.
In discharging its oversight responsibility as to the audit process, the Committee obtained from the independent auditors a formal written statement describing all relationships between the auditors and the Company that might bear on auditors'auditors’ independence consistent with Independence Standards Board Standard No. 1, "Independence“Independence Discussions with Audit Committees,"” discussed with the auditors any relationships that may impact their objectivity and independence and satisfied itself as to the auditors'auditors’ independence. The Committee also discussed with management, the internal auditors and the independent auditors the quality and adequacy of the Company'sCompany’s internal controls and internal audit function'sfunction’s organization, responsibilities, budget and staffing. The Committee reviewed with both the independent and internal auditors their audit plans, scope, and identification of audit risk areas.
The Committee discussed and reviewed with the independent auditors all communications required by auditing standards, generally accepted in the United States of America including those described in Statement on Auditing Standards No. 61, as amended, "Communication“Communication with Audit Committees,"” and discussed and reviewed the results of the independent auditors'auditors’ examination of the consolidated financial statements. The Committee also discussed the results of the internal audit examinations.
The Committee reviewed the consolidated audited financial statements of the Company as of and for the year ended December 31, 2003,2004, with management and the independent auditors. Management has the responsibility for the preparation of the Company'sCompany’s consolidated financial statements and the independent auditors have the responsibility for the audit of those statements.
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Based upon the above-mentioned review and discussions with management and the independent auditors, the Committee recommended to the Board that the Company'sCompany’s audited
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2003,2004, for filing with the Securities and Exchange Commission.
AUDIT COMMITTEE
V. B. Leister (Chairman)
Kenneth M. Hendren
Arthur R. Wyatt
COMMON STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENTAudit Committee V. B. Leister (Chairman) David L. Ikenberry Arthur R. Wyatt
Common Stock Ownership of Certain Beneficial Owners and Management
The following table sets forth certain information regarding the beneficial ownership of the Common Stock as of February 27, 20041, 2005 by all directors and director nominees, by each person who is known by the Company to be the beneficial owner of more than 5% of the outstanding Common Stock, by each executive officer named in the Summary Compensation Table and by all directors and executive officers as a group.
The number of shares beneficially owned by each director, director nominee, 5% stockholder or executive officer is determined under rules of the Commission,and the information is not necessarily indicative of beneficial ownership for any other purpose. Under such rules, beneficial ownership includes any shares as to which the individual has sole or shared voting power or investment power and also any shares which the individual has the right to acquire within 60 days of February 27, 20041, 2005 through the exercise of any option or other right. Unless otherwise indicated, each person has sole investment and voting power (or shares such powers with his or her spouse) with respect to the shares set forth in the following table. In certain instances, the number of shares listed includes, in addition to shares owned directly, shares held by the spouse or children of the person, or by a trust of which the person is a trustee or in which the person may have a beneficial interest. In some cases, the person has disclaimed beneficial interest in certain of these shares.
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| Common Stock Beneficially Owned | ||||||||
| Number of | Percent of | |||||||
| Shares | Outstanding | |||||||
| Name and Address of Beneficial Owner | Owned1 | Shares | ||||||
Douglas C. Mills2 2123 Seaton Court Champaign, Illinois 61821 | 3,751,888 | 18.18 | ||||||
Linda M. Mills3 2123 Seaton Court Champaign, Illinois 61821 | 1,151,806 | 5.59 | ||||||
| Joseph M. Ambrose | 62,493 | * | ||||||
| David Ikenberry | 6,000 | * | ||||||
| E. Phillips Knox | 309,219 | 1.50 | ||||||
Barbara J. Kuhl4 | 153,261 | * | ||||||
P. David Kuhl5 | 190,752 | * | ||||||
| V. B. Leister, Jr | 53,620 | * | ||||||
| David D. Mills | 278,628 | 1.35 | ||||||
| Joseph E. O’Brien | 21,000 | * | ||||||
| Edwin A. Scharlau II | 609,085 | 2.95 | ||||||
| Arthur R. Wyatt | 110,966 | * | ||||||
| All directors and executive officers as a group (12 persons) | 6,699,168 | 32.50 | ||||||
| * | Less than one percent. |
1 | Includes shares that can be acquired through stock options available for exercise within 60 days of February 1, 2005, for the following individuals, in the amount indicated: |
| Douglas C. Mills | 22,500 | |||
| Linda M. | 9,000 | |||
| Joseph M. | 4,500 | |||
| David L. Ikenberry | 4,500 | |||
| E. Phillips Knox | 9,000 | |||
| Barbara J. | 11,250 | |||
| P. David | 11,250 | |||
| V. B. Leister, | 9,000 | |||
| Joseph E. | 4,500 | |||
| Edwin A. Scharlau | 11,250 | |||
| Arthur R. | 4,500 | |||
| All directors and executive officers as a group | 101,250 |
2 | Includes 634,785 shares held by the Martin A. Klingel Estate for which Mr. Mills shares voting and dispositive powers with A. Barclay Klingel, Jr. Excludes 1,117,513 shares of common stock beneficially owned by Linda M. Mills, Mr. Mills’ spouse. Includes 34,293 shares of common stock owned by Busey Mills Community Foundation and 1,500,000 shares of common stock owned by Mills Investment LP. | |
3 | Excludes 3,717,595 shares of common stock beneficially owned by Douglas C. Mills, Mrs. Mills’ spouse. Includes 30,000 | |
4 | Excludes 190,752 shares of common stock beneficially owned by P. | |
5 | Excludes 153,261 shares of common stock beneficially owned by Barbara J. Kuhl, |
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Section 16(a) Beneficial Ownership Compliance
Section 16(a) of the Exchange Act requires the Company'sCompany’s directors, executive officers and holders of more than 10% of the Common Stock to file with the Commission, initial reports of ownership and reports of changes in ownership of common stock and other equity securities of the Company. The Company believes that during the fiscal year ended December 31, 20032004 its executive officers and directors complied with all Section 16(a) filing requirements exceptwith the following exceptions: each director and executive officer was delinquent to reporting of one acquisition transaction relating to the receipt of stock options in April 2004 for Ms.
Harringtonthe directors and Messrs. Ambrose, Banks, Dawson, Hendren, LeisterSeptember 2004 for the executive officers and, additionally, Mr. David Mills who
were eachwas delinquent in the reporting of one acquisition transaction.transaction and Mr. Wyatt was delinquent in the reporting of two acquisition transactions. In making thesethe foregoing statements, the Company has relied upon the written representations of its directors and executive officers.
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COMPENSATION OF EXECUTIVE OFFICERS
Compensation of Executive Officers
The following table discloses compensation received by the Company'sCompany’s Chief Executive Officer and four other executive officers of the Company earning at least $100,000 in 2003.
SUMMARY COMPENSATION TABLE
2004.
Summary Compensation Table
| Restricted | Securities | |||||||||||||||||||||||||||
| Other Annual | Stock | Underlying | All Other | |||||||||||||||||||||||||
| Name and Principal Positions | Year | Salary($) | Bonus ($) | Compensation | Awards($) | Options/SARS (#) | Compensation ($)1 | |||||||||||||||||||||
| Douglas C. Mills | 2004 | 100,000 | 160,000 | — | — | 40,000 | 115,056 | |||||||||||||||||||||
| Chairman of the Board and | 2003 | 150,000 | 100,000 | — | — | — | 98,629 | |||||||||||||||||||||
| Chief Executive Officer | 2002 | 100,000 | 140,000 | — | — | 30,000 | 83,281 | |||||||||||||||||||||
| Edwin A. Scharlau II | 2004 | 175,000 | 71,650 | — | — | 23,000 | 83,082 | |||||||||||||||||||||
| Chairman of the Board of | 2003 | 170,000 | 60,000 | — | — | — | 71,955 | |||||||||||||||||||||
| Busey Investment Group | 2002 | 140,000 | 80,000 | — | — | 20,000 | 63,712 | |||||||||||||||||||||
| P. David Kuhl | 2004 | 175,000 | 73,280 | — | — | 23,000 | 82,920 | |||||||||||||||||||||
| Chairman of the Board and | 2003 | 170,000 | 60,000 | — | — | — | 72,087 | |||||||||||||||||||||
| Chief Executive Officer of Busey Bank | 2002 | 140,000 | 80,000 | — | — | 20,000 | 63,751 | |||||||||||||||||||||
| Barbara J. Kuhl | 2004 | 170,000 | 73,000 | — | — | 23,000 | 81,677 | |||||||||||||||||||||
| President, Corporate Secretary, | 2003 | 120,000 | 67,500 | — | — | — | 68,076 | |||||||||||||||||||||
| Treasurer and Chief Operating Officer | 2002 | 100,000 | 80,000 | — | — | 20,000 | 60,019 | |||||||||||||||||||||
| David D. Mills | 2004 | 100,000 | 42,400 | 14,455 | 2 | — | 17,000 | 11,721 | ||||||||||||||||||||
| President and Chief Operating | 2003 | 70,000 | 30,000 | 12,760 | 2 | — | — | 5,416 | ||||||||||||||||||||
| Officer of Busey Bank | 2002 | 60,000 | 10,000 | 12,640 | 2 | 64,050 | 3 | — | 8,849 | |||||||||||||||||||
| 1 | The amounts disclosed in this column for 2004 include: Company contributions of $5,527, $11,060, $11,012, $10,576 and $9,310 under the First Busey Corporation Profit Sharing Plan & Trust, a defined contribution plan, on behalf of Mr. Mills, | |
| Discretionary company contributions of $1,431, $2,864, $2,852, $2,739 and $1,726, under the First Busey Corporation Employee Stock Ownership Plan, a defined contribution plan, on behalf of Mr. Mills, Mr. Scharlau, Mr. Kuhl, Mrs. Kuhl, and Mr. Mills, respectively. |
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| Company match of $50,000 on behalf of Mr. Mills, Mr. Scharlau, Mr. Kuhl and Mrs. Kuhl under the First Busey Corporation Deferred Compensation Plan for Executives. Interest was also paid by the Company at a rate of 8.25%. The interest paid to Mr. Mills was $31,549 and the interest paid to Mr. Scharlau, Mr. Kuhl and Mrs. Kuhl was $18,363. | ||
| Compensation value of split-dollar life insurance policies on Mr. Mills in the amount of $26,549. The Company will be reimbursed for those premiums paid on the policies, without interest, from the proceeds of the | ||
| 2 | In each year, $10,000 was contributed to the University of Illinois I Fund in the name of Mr. Mills. The remaining amount relates to annual country club dues paid on behalf of Mr. Mills. | |
| 3 | Based on the closing price of Common Stock of $14.23 quoted on Nasdaq on January 2, 2002 |
Options/SAR Grants in Last Fiscal Year
| Potential Realizable Value at | ||||||||||||||||||||||||
| Assumed Annual Rates | ||||||||||||||||||||||||
| Of Stock Price Appreciation | ||||||||||||||||||||||||
| Individual Grants | For Option Term | |||||||||||||||||||||||
| Number of | ||||||||||||||||||||||||
| Securities | % of Total | |||||||||||||||||||||||
| Underlying | Options Granted to | Exercise or | ||||||||||||||||||||||
| Options/Sar’s | Employees in Fiscal | Base Price | Expiration | |||||||||||||||||||||
| Name | Granted (#) | Year | ($/Share) | Date | 5% ($) | 10% ($) | ||||||||||||||||||
| Douglas C. Mills | 40,000 | 13 | % | 19.59 | 9/14/09 | 281,840 | 560,854 | |||||||||||||||||
| Edwin A. Scharlau II | 23,000 | 8 | % | 19.59 | 9/14/09 | 162,058 | 322,491 | |||||||||||||||||
| P. David Kuhl | 23,000 | 8 | % | 19.59 | 9/14/09 | 162,058 | 322,491 | |||||||||||||||||
| Barbara J. Kuhl | 23,000 | 8 | % | 19.59 | 9/14/09 | 162,058 | 322,491 | |||||||||||||||||
| David D. Mills | 17,000 | 6 | % | 19.59 | 9/14/09 | 119,782 | 112,171 | |||||||||||||||||
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Aggregated Options/SAR Exercises in Last Fiscal Year and Mrs. Harrington
received 694, 377, 396, 396 and 99 shares of Common Stock,
respectively, under the 2001 Management and Associate Dividend Program.
The shares were valued at the closing price on November 20, 2001, the
date the award was approved by the Board. The stock values included for
Mr. Mills, Mr. Scharlau, Mr. Kuhl and Ms. Kuhl were $14,005, $7,608,
$7,991, $7,991 and $1,998 respectively.
(2) The amounts disclosed in this column for 2003 include:
Company contributions of $9,212, $11,054, $11,228, $8,393 and $6,357
under the First Busey Corporation Profit Sharing Plan & Trust, a
defined contribution plan, on behalf of Mr. Mills, Mr. Scharlau, Mr.
Kuhl, Mrs. Kuhl, and Mrs. Harrington, respectively.
Discretionary company contributions of $1,616, $1,939, $1,970, $1,472
and $1,117, under the First Busey Corporation Employee Stock Ownership
Plan, a defined contribution plan, on behalf of Mr. Mills, Mr.
Scharlau, Mr. Kuhl, Mrs. Kuhl, and Mrs. Harrington, respectively.
Company match of $50,000 on behalf of Mr. Mills, Mr. Scharlau, Mr. Kuhl
and Mrs. Kuhl under the First Busey Corporation Deferred Compensation
Plan for Executives. Interest was also paid by the Company at a rate of
7.715%. The interest paid to Mr. Mills was $15,535 and the interest
paid to Mr. Scharlau, Mr. Kuhl and Mrs. Kuhl was $8,211.
Compensation value of split-dollar life insurance policies on Mr. Mills
in the amount of $22,266. The Company will be reimbursed for those
premiums paid on the policies, without interest, from the proceeds of
the policies. Mr. Mills currently has two $10,000,000 split-dollar life
insurance policies. The first policy was acquired in 1992 and the
second policy was acquired in 2000. Split-dollar life insurance
policies were acquired on Mr. Scharlau and Mr. Kuhl in 1994. For 2003,
$751 and $678, respectively, represent the compensation value of these
policies to Mr. Scharlau and Mr. Kuhl.
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AGGREGATED OPTIONS/Fiscal Year-End Options/SAR EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END
OPTIONS/SAR VALUESValues
The following table provides information on option exercises in fiscal 20032004 by the named executive officers and the value of such officers'officers’ unexercised options at December 31, 2003
2004.
| Number of Securities | ||||||||||||||||||||||||
| Underlying Unexercised | Value of Unexercised | |||||||||||||||||||||||
| Options/SARs at | In-the-Money Options/SARs | |||||||||||||||||||||||
| December 31, 2004(#) | at December 31, 2004($)1 | |||||||||||||||||||||||
| Shares | ||||||||||||||||||||||||
| Acquired on | Value | |||||||||||||||||||||||
| Name | Exercise (#) | Realized ($) | Exercisable | Unexercisable | Exercisable | Unexercisable | ||||||||||||||||||
| Douglas C. Mills | 22,500 | 122,513 | 22,500 | 85,000 | 201,375 | 335,150 | ||||||||||||||||||
| Edwin A. Scharlau II | 18,300 | 126,672 | 11,250 | 53,000 | 100,688 | 218,740 | ||||||||||||||||||
| P. David Kuhl | 18,300 | 112,284 | 11,250 | 53,000 | 100,688 | 218,740 | ||||||||||||||||||
| Barbara J. Kuhl | 6,600 | 49,456 | 11,250 | 53,000 | 100,688 | 218,740 | ||||||||||||||||||
| David D. Mills | 0 | 0 | 0 | 32,000 | 0 | 116,410 | ||||||||||||||||||
| 1 | Based on the closing price of Common Stock of $20.87 quoted on Nasdaq on December 31, |
Report of the Compensation Committee on the closing price of Common Stock of $27.00 quoted on Nasdaq
on December 31, 2003.
REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATIONExecutive Compensation
The Executive Management Compensation and Succession Committee of the Board of Directors administers the Company'sCompany’s executive compensation program. After consideration of the Committee'sCommittee’s recommendations, the full Board of Directors reviews and approves all compensation, both monetary and stock-based to all executive officers.
In the past, there have been
There are three main components to the executive officers'management compensation package: (1) salary, cash(2) bonus and (3) stock awards. Itawards, typically in the form of stock options.
The cash portion of compensation (annual salary and bonus) is determined after completing an analysis of peer compensation and performance. Stock-based compensation is based similarly on peer stock-based compensation and performance and reflects the intention of the Committee that compensation be set in such a manner as to be
competitive to attract, retain and motivate its management team. The Committee
also believesCommittee’s belief that stock ownership by its executive officers assists in aligningmanagement is critical to align the executive officers'officers’ interests with those of the Company'sCompany’s stockholders.
Salaries for the executive officers are determined after consultation with a third party, which undertook and completed a study of peer compensation.
In January 2003,early 2004, the Committee recommended and the Board of Directors approved the Management and Associate Dividend Program, or the "MAD program."“MAD program,” for 2004. Payments under the MAD program comprise the officers’ respective cash bonus. Under the 2004 MAD program, the Board of Directors, upon the recommendation of the Committee, set four targeted levels for "diluted“diluted earnings per share"share” for the Company for 2003. Thesefiscal 2004. For the executive officers, these levels were $1.43, $1.44, $1.45,$1.0533, $1.0600, $1.0666 and $1.46.$1.0733 and were to exclude the contribution from First Capital Bank, the acquisition of which closed in June of 2004.
Based on the level of achievement of earnings per share, the officer or
associateexecutive officers would receive a dividend of a predetermined percentage of their salary. If the minimum level was not reached, there
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would be no dividend paid under the MAD program. If the top level was exceeded, the dividend would not be increased. The goal of the MAD program is to heighten awareness of the Company'sCompany’s earnings per share goal while emphasizing the impact of the team concept throughout the organization. The term "dividend" was“dividend” is used to indicate that this award was granted at the discretion of the Board of Directors and would beis based annually on the achievement of earnings per share, similar to the dividend paid to the Company'sCompany’s stockholders. Under this program, the Board
- 12 -
hopes to further enhance the alignment of the staff's efforts with those of the
Company's stockholders.
Compensation of the Chief Executive Officer
Base Salary/MAD Program.Mr. Mills' 2003Mills’ 2004 base salary was set at $150,000,$100,000, representing a 50% increase33 1/3% decrease from his base salary of $100,000$150,000 for 2002.2003. The Committee determined that under the MAD program, if the level of earnings per share set by the Board was achieved, $1.43, $1.44, $1.45,$1.0533, $1.0600, $1.0666, or $1.46,$1.0733, excluding the net income of First Capital Bank, Mr. Mills'Mills’ dividend would be $80,000, $90,000, $100,000,$150,000, or $105,000,$160,000, respectively. Based on the Company'sCompany’s achievement of earnings per share of $1.45,$1.0733, excluding the contribution resulting from the First Capital acquisition, Mr. Mills received a cash dividend“dividend” of $100,000. The Committee determined that the increase
in base compensation, along with the potential under the MAD program will bring$160,000 which comprised Mr. Mills' total compensation package more in line with peer chief executive
officers.
Mills’ cash bonus for fiscal 2004.
Stock Options. The granting ofOptions. Mr. Mills was granted stock options byexercisable for 40,000 shares of the Committee is
designed to retain and motivateCompany’s Common Stock, or 13% of the management team as well as align executive
officers' financial interests with stockholder value. The number oftotal stock options granted to an executive officer and other officers is determined by the
Committee and approved by the Board. Grants of stock options are intended to
recognize different levels of contribution to the achievement of the Company's
annual corporate goals as well as different levels of responsibility and
experience. All stock options are granted with an exercise price equal to the
fair market value of Common Stock on the date of grant. There were no stock
options grantedemployees in 2003.
COMPENSATION COMMITTEE
Arthur R. Wyatt (Chairman)
V. B. Leister
Samuel P. Banks2004.
| Compensation Committee | ||
| Joseph. M. Ambrose (Chairman) | ||
| V. B. Leister, Jr. | ||
| Arthur R. Wyatt |
Notwithstanding anything to the contrary set forth in any of the Company'sCompany’s previous filings under the Securities Act of 1933 or the Exchange Act that might incorporate future filings, including this Proxy Statement, in whole or in part, the preceding report and the Performance Table included below shall not be incorporated by reference into any such filings.
COMPANY PERFORMANCE
Company Performance
The following table compares the Company'sCompany’s performance, as measured by the change in price of Common Stock plus reinvested dividends, with the CRSP Nasdaq Total Return Index- UnitedIndex-United States and the SNL-Midwestern Banks Index for the five years ended December 31, 2003.
- 13 -
FIRST BUSEY CORPORATION
STOCK PRICE PERFORMANCE
[TOTAL RETURN PERFORMANCE GRAPH]
2004.
PERIOD ENDING
---------------------------------------------------------------
INDEX 12/31/98 12/31/99 12/31/00 12/31/01 12/31/02 12/31/03
----- -------- -------- -------- -------- -------- --------
First Busey Corporation 100.00 126.68 114.38 126.41 139.55 167.91
NASDAQ - Total US* 100.00 185.95 113.19 89.65 61.67 92.90
SNL Midwest Bank Index 100.00 78.57 95.15 97.24 93.80 120.07
-13-
First Busey Corporation
Stock Price Performance
| Index | 12/31/00 | 12/31/01 | 12/31/02 | 12/31/03 | 12/31/04 | |||||||||||||||
| First Busey Corporation | 90.29 | 99.79 | 110.15 | 132.54 | 157.97 | |||||||||||||||
| NASDAQ — Total US* | 60.82 | 48.16 | 33.11 | 49.93 | 54.49 | |||||||||||||||
| SNL Midwest Bank Index | 121.10 | 123.76 | 119.39 | 152.82 | 172.44 | |||||||||||||||
The Banks in the Custom Peer Group --— SNL-Midwestern Banks Index --— represent all publicly traded banks, thrifts or financial service companies located in Iowa, Illinois, Indiana, Kansas, Kentucky, Michigan, Minnesota, Missouri, North Dakota, Nebraska, Ohio, South Dakota and Wisconsin.
- 14 -
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Compensation Committee Interlocks and Insider Participation
Mr. Ambrose, a director of the Company, is an attorneyhas been a partner with Costigan & Wollrab, P.C. since April 1, 2004. Prior to that, he was with Ambrose Law Offices, Ltd., and Mr. Ambrose has provided legal services to the Company during fiscal 2003.2004. The aggregate dollar amount of the fees paid to Costigan & Wollrab, P.C. and Ambrose Law Offices, Ltd. for such services during 2004 was $74,828.
-14-
Certain Relationships and Related Transactions
Mr. Scharlau, an officer of the 2003 fiscal yearCompany, had two family members working for the Company during 2004. Robert Scharlau, son of Mr. Scharlau, was $42,330.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONSemployed with Busey Bank Florida and was compensated in the amount of $65,088. Thomas Scharlau, brother of Mr. Scharlau, was employed with Busey Bank and was compensated in the amount of $141,056.
Mr. Knox, a director of the Company, is an attorney with Tummelson Bryan & Knox, Urbana, Illinois, and provided legal and certain consulting services to the Company during fiscal 2003.2004. The dollar amount of the fees paid to Tummelson Bryan & Knox for such services during the 20032004 fiscal year was $172,896.$80,205.
The Company'sCompany’s banking subsidiaries have, and may be expected to have in the future, banking transactions in the ordinary course of business with directors, director nominees, executive officers and holders of 5% or more of the Company'sCompany’s Common Stock, their immediate families and their affiliated companies. These transactions have been and will be on the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with unaffiliated persons. These transactions have not involved and will not involve more than the normal risk of collectibility or any other unfavorable features. At December 3l, 2003,2004, these persons and companies were indebted to the Company'sCompany’s banking subsidiaries for loans totaling approximately $4.736$1.713 million representing 3.78%1.23% of total stockholders'stockholders’ equity. In addition to these loans, the Company'sCompany’s banking subsidiaries make loans to officers of the Company'sCompany’s subsidiaries who are not executive officers of First Busey.
PROPOSAL NO.
Proposal No. 2
APPROVAL OF THE FIRST BUSEY CORPORATION 2004 STOCK OPTION PLAN
GENERAL
Change in the par value of the Company’s Capital Stock from no par
value per share to $.001 par value per share under the Company’s
Amended and Restated Articles of Incorporation
The Company previously awarded options under its 1999 Stock Option
Plan. Options covering 414,700 shares of Common Stock have been issued pursuant
to the 1999 Plan. As of February 27, 2004, 85,300 shares were reserved for
issuance pursuant to the 1999 Plan. TheCompany’s Board of Directors believes that,
becausehas unanimously adopted a resolution seeking stockholder approval to amend the par value of its capital stock from no par value per share to $.001 per value per share. The proposed amendment will not have any material effect on the Company’s business, operations, reporting requirements or stock price. Stockholders will not be required to have new stock certificates reflecting the change in the par value.
A copy of the Company's continued anticipated growth, itproposed Amended and Restated Articles of Incorporation is attached as Annex A to this Proxy Statement.
Par value is used to designate the lowest value for which a company can sell its stock, and is used in valuing the common stock on a company’s balance sheet. Historically, the concepts of par value and the stated capital of a company were to protect creditors and senior security holders by ensuring that a company received at least the par value as consideration for issuance of its shares. Over time, these concepts have lost their significance for the most part. So, while an increase in par value may at one time have been significant, that is no longer true.
The increase in the par value would have no effect on the Company’s stockholders’ equity as computed according to generally accepted accounting principles and as such equity is shown in the financial statements. The change in par value would not change the number of authorized shares of capital stock. Authorized shares will be necessaryremain at 40,000,000 for shares of common stock and 1,000,000 for
-15-
shares of preferred stock. The change in par value will also not affect outstanding stock options.
The change from a “no par value” to hire additional management personnel.a stipulated par value of $.001 per share, if approved by the stockholders, will result in a reclassification on the Company’s balance sheet, shifting amounts within the “shareholder’s equity” category between the “common stock” line item and the “surplus” line item, and thus will not affect the overall balance sheet amounts. The change also will not affect the consolidated statements of income. The change in par value will cause technical changes in the balance sheet as to the amounts shown as “common stock” and “surplus.”
In viewaddition, certain states base the amount of these personnel needs,franchise taxes and filing fees payable by a corporation on the par value of its authorized shares. Nevada recently adopted such a provision. The increase in lightpar value will decrease our franchise tax payments and our filing fees within the State of Nevada because at no par value, the State of Nevada automatically assessed the maximum franchise tax for the Company, $11,000 per year.
Vote Required
The affirmative vote of a majority of the present leveltotal number of remuneration paidshares of issued and outstanding common stock is required to management andapprove the present
level of management's equitychange in the Company,par value of the Company’s capital stock from no par value per share to $.001 par value per share.
The Company’s Board of Directors isrecommends that stockholders vote FOR the approval of the opinion that it is appropriate that stock options continue to be a major
componentAmended and Restated Articles of Incorporation, which increases the Company's management remuneration package. Accordingly, on
February 17, 2004, the Board of Directors, subject to
- 15 -
stockholder approval, adopted the First Busey Corporation 2004 Stock Option
Plan. The complete text of the 2004 Plan is attached hereto as Annex D.
TERMS OF THE PLAN
Under the 2004 Plan, options to purchase 1,000,000 shares of Common
Stock may be issued. Options available under the 1999 Stock Option Plan will be
issued prior to any issuance under the 2004 Stock Option Plan, if approved. The
2004 Plan is administered by the Executive Management Compensation and
Succession Committee, a committee consisting of at least three non-employee
directors within the meaning of Rule 16b-3 under the Exchange Act selected by
the Board of Directors. Within the applicable limits of the 2004 Plan, such
committee shall have full authority to select from among eligible individuals
those to whom options shall be granted under the 2004 Plan, the number of shares
subject to each option and the price, terms and conditions of any options to be
granted thereunder. The Board of Directors shall have full authority to amend
the 2004 Plan. No amendment to the 2004 Plan shall, without the consent of the
holder of an existing option, materially and adversely affect their rights under
such option.
Employees and directors of the Company and employees and directors of
its subsidiaries are eligible to receive options under the 2004 Plan. The
exercise price of any option must be equal to at least 100% of the fair marketpar value of the shares on the date of the grant.
No option may be exercisable for more than ten yearsCompany’s capital stock from the date of
grant.
Under the 2004 Plan, only non-qualified stock options may be granted.
For federal income tax purposes, a holder of a non-qualified stock option will
generally realize taxable income upon the exercise of an option, and at that
time the Company will then be allowed a tax deduction equalno par value per share to the excess of (a)
the aggregate market$.001 par value at the time of such exercise of shares acquired
pursuant to such exercise over (b) the aggregate option exercise price for such
shares.
Options may generally not be transferred except to the extent that
options may be exercised by an executor or administrator. Under the 2004 Plan,
options generally lapse if the optionee ceases to be an employee of the Company
or its subsidiaries. However, if the cessation of employment is due to
disability or death of the optionee, options may be exercised within 180 days of
the optionee's death or disability, provided, however, that no option may be
exercisable after its normal expiration date.
The 2004 Plan terminates on February 17, 2014. The 2004 Plan may be
altered, suspended or discontinued at any time by the Board of Directors,
provided that no such action may, without the consent of an optionee, materially
and adversely affect their rights under any outstanding options. If approval of
the stockholders is not obtained at the 2004 Annual Meeting, the 2004 Plan will
be terminated. Options are subject to adjustment to protect against dilution in
certain events, including the recapitalization or reorganization of the Company,
its merger into or consolidation with another corporation, stock splits and
stock dividends.
- 16 -
EQUITY COMPENSATION
The following table discloses the number of outstanding options,
warrants and rights granted by the Company to participants in equity
compensation plans, as well as the number of securities remaining available for
future issuance under these plans. All Company equity compensation plans have
been approved by stockholders. The table does not include shares available for
issuance under the proposed 2004 Stock Option Plan, as that plan is subject to
stockholder approval.
C. NUMBER OF
SECURITIES REMAINING
A. NUMBER OF AVAILABLE FOR FUTURE
SECURITIES TO BE ISSUED B. WEIGHTED-AVERAGE ISSUANCE UNDER EQUITY
UPON EXERCISE OF EXERCISE PRICE OF COMPENSATION PLANS
OUTSTANDING OPTIONS, OUTSTANDING OPTIONS, (EXCLUDING SECURITIES
PLAN CATEGORY WARRANTS AND RIGHTS WARRANTS AND RIGHTS REFLECTED IN COLUMN A)
- --------------------------------------------------------------------------------------------------
Equity compensation plans
approved by stockholders 401,900 $20.13 483,500
- --------------------------------------------------------------------------------------------------
OTHER BUSINESSper share.
Other Business
So far as is presently known, there is no business to be transacted at the Annual Meeting other than that referred to in the Notice of Annual Meeting of Stockholders and it is not anticipated that other matters will be brought before the Annual Meeting. If, however, other matters should properly be brought before the Annual Meeting, it is intended that the proxy holders may vote or act in accordance with the Company'sCompany’s Board of Directors'Directors’ recommendation on such matters.
STOCKHOLDER PROPOSALS
Stockholder Proposals
If a stockholder intends to present a proposal at the Company's 2005Company’s 2006 Annual Meeting and desires that the proposal be included in the Company'sCompany’s Proxy Statement and form of proxy for that meeting, the proposal must be in compliance with Rule 14a-8 under the Exchange Act and received at the Company'sCompany’s principal executive offices not later than November 20, 2004.15, 2005. As to any proposal that a stockholder intends to present to stockholders without inclusion in the Company'sCompany’s Proxy Statement for the Company's 2005Company’s 2006 Annual Meeting of Stockholders, the proxies named in management'smanagement’s proxy for that meeting will be entitled to exercise their discretionary authority on that proposal unless the Company receives notice of the matter to be - 17 -
February 3, 2005.January 30, 2006. Even if proper notice is
-16-
received on or prior to February 3, 2005,January 30, 2006, the proxies named in management'smanagement’s proxy for that meeting may nevertheless exercise their discretionary authority with respect to such matter by advising stockholders of such proposal and how they intend to exercise their discretion to vote on such matter, unless the stockholder making the proposal solicits proxies with respect to the proposal to the extent required by Rule 14a-4(c)(2) under the Exchange Act.
| By order of the Board of Directors, | ||
| Barbara J. Kuhl | ||
| President and Chief Operating Officer, | ||
| Corporate Secretary and Treasurer |
March 16, 2005
-17-
Annex A
Amended and Restated Articles of Incorporation
of
First Busey Corporation
First.The name of the corporation (hereinafter called the Corporation) is:
First Busey Corporation
Second.The address of the Corporation’s Registered Office in the State of Nevada is 3800 Howard Hughes Parkway, 7th Floor, Las Vegas, Nevada, County of Clark, 89109. The name of the Corporation’s Registered Agent at such address is Kummer, Kaempfer, Bonner and Renshaw.
Third.The nature of the business or purposes of the Corporation is as follows:
To engage in any lawful act or activity for which corporations may be organized under the Nevada Revised Statutes.
Fourth.
A. Classes and Number of Shares.The total number of shares of all classes of stock the Corporation shall have authority to issue is 41,000,000 shares. The classes and the aggregate number of shares of stock of each class which the Corporation shall have authority to issue are as follows:
1. 40,000,000 shares of Common Stock, $.001 par value per share.
2. 1,000,000 shares of Preferred Stock, $.001 par value per share.
B.Powers and Rights of Common Stock.
1. Voting Rights and Powers.With respect to all matters upon which stockholders are entitled to vote or to which stockholders are entitled to give consent, the holders of the outstanding shares of the Common Stock shall be entitled to cast thereon one (1) vote in person or by proxy for each share of the Common Stock standing in his name.
2.Dividends and Distributions.
a.Cash Dividends.When cash dividends may be declared by the Board of Directors, Barbara J. Kuhl
President and Chief Operating Officer,
Corporate Secretary and Treasurer
March 12, 2004
- 18 -
ANNEX A
FIRST BUSEY CORPORATION
EXECUTIVE MANAGEMENT COMPENSATION
AND SUCCESSION COMMITTEE CHARTER
PURPOSE
The Executive Management Compensation and Succession Committee shall
(1) dischargefor purposes of calculating the Board's responsibilities relatingcash dividend to compensationbe paid on shares of the Company's directors and executive officers, (2) approve and evaluate all
compensation of directors and executive officers, including salaries, bonuses,
and compensation plans, policies and programsCommon Stock, the amount of the Company, (3) produce an
annual reportcash dividend declared and payable on executive compensation for inclusion inshares of the Company's proxy
statementCommon Stock, determined in accordance with applicable rulesthis provision, may be rounded up to the next highest half cent or fraction thereof.
b.Other Dividends and regulationsDistributions.Each share of the Common Stock shall be equal in respect of rights to dividends (other than cash) and (4) considerdistributions, when and proposeas declared, in the form of stock or other property of the Corporation, except that in the case of dividends or other distributions payable in stock of the Corporation, including distributions pursuant
3. Other Rights.Except as otherwise required by the Nevada Revised Statutes, or as otherwise provided in the Articles of Incorporation, each share of the Common Stock shall have identical powers, preferences and rights, including rights in liquidation.
4. Issuance of the Common Stock.The Board of Directors of the Corporation may from time to time authorize by resolution the issuance of any or all of the authorized but unissued shares of the Common Stock for such purposes, in such amounts, to such persons, corporations or entities, for such consideration, all as the Board of Directors at its discretion may determine and without any vote or other action by the stockholders, except as otherwise required by law. The Board of Directors may issue shares of the Common Stock in the form of a distribution or distributions pursuant to a stock dividend or split-up of the shares of the Common Stock only to the then holders of the outstanding shares of the Common Stock.
C.Powers and Rights of Preferred Stock.
1. Shares of Preferred Stock may be issued in one or more series at such time or times and for such consideration as the Board of Directors may determine. Each such series shall be given a distinguishing designation. All shares of any one series shall have preferences, limitations and relative rights identical with those of other shares of the same series and, except to the extent otherwise provided in the description of such series, with those of other shares of Preferred Stock.
2. Authority is hereby expressly granted to the Board management succession strategies.
EXECUTIVE MANAGEMENT COMPENSATION AND SUCCESSION COMMITTEE
COMPOSITION AND MEETINGS
The Committee shall consist of no fewer than three directors, the exact
numberDirectors to be determinedfix from time to time, by resolution or resolutions providing for the establishment and/or issuance of any series of Preferred Stock, the designation of such series and the preferences, limitations and relative rights of the Board. Each
membershares of the Committee shall satisfy the independence requirements of the
listing standards of the exchange or quotation system upon which the Company's
common stock is listed and traded at any time, and applicable securities laws
and regulations. In addition, each member shall meet the definition of
"non-employee director" under Rule 16b-3 under the Securities Exchange Act of
1934, and "outside director" for purposes of Section 162(m) of the Internal
Revenue Code of 1986. The Board shall appoint the Chair and the other members of
the Committee annually, considering the recommendation of the Nominating &
Corporate Governance Committee. The members of the Committee shall serve until
their successors are appointed and qualify. The Board shall have the power at
any time to change the membership of the Committee and to fill vacancies in it,
subject to such new member, or members, satisfying the above requirements.
The Chair shall be responsible for leadership of the Committee,
including overseeing the agenda, presiding over the meetings and reporting to
the Board. If the Chair is not present at a meeting, the members of the
Committee may designate a Chair. The Committee shall meet at least twice each
year and hold such other meetings from time to time as may be called by its
Chair or any two members of the Committee. Meetings may also be held
telephonically or actions may be taken by unanimous written consent. A majority
of the members of the Committee shall constitute a quorum of the Committee. The
vote of a majority of the members of the full Committee shall be the act of the
Committee. Except as expressly provided in the Articles of Incorporation or the
Bylaws of the Company or as required by law, regulations or applicable listing
standards, the Committee shall fix its own rules of procedure. The Chair will
report the highlights of Committee meetings to the full Board at the Board's
next regular meeting.
The Committee shall have the sole authority to retain and terminate any
compensation consultant to be used to assist in the evaluation of director, CEO
or senior executive compensation and shall have sole authority to approve the
consultant's fees and other retention terms. The Committee shall also have
authority to obtain advice and assistance from internal or external legal,
accounting or other advisors.
EXECUTIVE MANAGEMENT COMPENSATION AND SUCCESSION COMMITTEE AUTHORITY,
DUTIES AND RESPONSIBILITIES
1. The Committee shall review and approve corporate goals and
objectives relevant to compensation of the CEO, evaluate the CEO's performance
in light of those goals and objectives, and set the CEO's respective
compensation level based on this evaluation.
2. In determining the long-term incentive component of
compensation for the CEO, the Committee should consider the Company's
performance and relative shareholder return, the value of similar incentive
awards to CEOs at comparable companies, and the awards given to the Company's
CEO in past years.
3. The Chair shall report the results of the annual performance
evaluation of the CEO at an executive session of non-management directors.
4. The Committee shall oversee the evaluation of the executive
officers of the Company and review and approve periodically a general
compensation program and salary structure for executive officers of the Company
that (i) supports the Company's overall business strategy and objectives; (ii)
attracts and retains key executives; (iii) links compensation with business
objectives and organizational performance; and (iv) provides competitive
compensation opportunities.
5. The Committee shall (i) make recommendations to the Board with
respect to base salary, incentive compensation and equity-based plans applicable
to executive officers; and (ii) adopt, administer, approve and ratify awards
under incentive compensation and equity-based plans applicable to executive
officers, including amendments to the awards made under any such plans, and
review and monitor awards under such plans.
6. The Committee shall assist the Board in developing and
evaluating potential candidates for executive positions,series, including the CEO,following:
a. The distinctive designation and to oversee the developmentnumber of executive succession plans.
7. The Committee shall review and approve any executive
employment agreements, severance agreements, and change in control agreements or
provisions and determine the Company's policy with respect to the application of
Internal Revenue Code Section 162(m).
8. The Committee shall annually review the Board's policy for
director compensation and benefits and recommend any proposed changes to the
Board for approval.
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9. The Committee shall prepare an annual report for the Company's
proxy statement regarding executive compensation,shares comprising such series, which number may (except as required by law and rules
of the applicable exchange.
10. The Committee shall, in the course of its review of executive
compensation, review the list of a peer group of companies to which the Company
shall compare itself for compensation purposes and make any changes in such
list.
11. The Committee shall report its actions and any recommendations
to the Board after each Committee meeting.
12. The Committee shall review and reassess the adequacy of this
Charter annually and recommend any proposed changes to the Board for approval.
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ANNEX B
FIRST BUSEY CORPORATION
NOMINATING & CORPORATE GOVERNANCE COMMITTEE CHARTER
PURPOSE
The Nominating & Corporate Governance Committee shall (1) identify
individuals qualified to become Board members, and recommend that the Board
select the director nominees for the next annual meeting of shareholders; and
(2) develop and recommend to the Board Corporate Governance Guidelines
applicable to the Company.
NOMINATING & CORPORATE GOVERNANCE COMMITTEE COMPOSITION AND MEETINGS
The Nominating & Corporate Governance Committee shall consist of no
fewer than two directors. Each member of the Nominating & Corporate Governance
Committee shall satisfy the independence requirements of The Nasdaq National
Market. The Board shall appoint the Chair and the other members of the
Nominating & Corporate Governance Committee annually. The members of the
Nominating & Corporate Governance Committee shall serve until their successors
are appointed and qualify. The Board shall have the power at any time to change
the membership of the Nominating & Corporate Governance Committee and to fill
vacancies in it, subject to such new member(s) satisfying the independence
requirements established by the Nasdaq.
The Chair shall be responsible for leadership of the Nominating &
Corporate Governance Committee, including overseeing the agenda, presiding over
the meetings and reporting to the Board. If the Chair is not present at a
meeting, the members of the Nominating & Corporate Governance Committee may
designate a Chair. The Nominating & Corporate Governance Committee shall meet at
least once each year and hold such other meetings from time to time as may be
called by its Chair, the Chief Executive Officer ("CEO") or any two members of
the Committee. Meetings may also be held telephonically or actions may be taken
by unanimous written consent. A majority of the members of the Nominating &
Corporate Governance Committee shall constitute a quorum of the Committee. The
vote of a majority of the members of the full Nominating & Corporate Governance
Committee shall be the act of the Committee. Except as expresslyotherwise provided in the
Charter or the By-laws of the Company or as required by law, regulations or
Nasdaq listing standards, the Nominating & Corporate Governance Committee shall
fix its own rules of procedure.
NOMINATING & CORPORATE GOVERNANCE COMMITTEE AUTHORITY, DUTIES AND
RESPONSIBILITIES
1. The Nominating & Corporate Governance Committee shall develop
qualification criteria for Board members, and search for, interview and screen
individuals qualified to become
Board members for recommendation to the Board and consider stockholders'
recommendations for director candidates, all in accordance with the Corporate
Governance Guidelines.
2. The Nominating & Corporate Governance Committee shall have the
sole authority to retain and terminate any search firm to be used to identify
director candidates and shall have sole authority to approve the search firm's
fees and other retention terms. The Nominating & Corporate Governance Committee
shall also have authority to obtain advice and assistance from internal or
external legal, accounting or other advisors.
3. The Nominating & Corporate Governance Committee shall
recommend to the Board the membership of the committees of the Board.
4. The Nominating & Corporate Governance Committee shall oversee
the evaluation of the performance of incumbent directors and determine whether
to recommend them for re-election to the Board.
5. The Nominating & Corporate Governance Committee shall oversee
the evaluation of the executive officers of the Company and make recommendations
to the Board as appropriate.
6. The Nominating & Corporate Governance Committee shall initiate
and oversee a periodic evaluation of (i) the quality, sufficiency and timeliness
of information furnished by management to the directors in connection with Board
and committee meetings and other activities of the directors, (ii) the
composition, organization (including its committee structure, membership and
leadership) and practices of the Board, (iii) tenure and other policies related
to the directors' service on the Board, and (iv) corporate governance matters
generally; and recommend action to the Board where appropriate.
7. The Nominating & Corporate Governance Committee shall monitor
the orientation and training needs of directors and recommend action to the
Board, individual directors and management where appropriate.
8. The Nominating & Corporate Governance Committee shall review
periodically with the Company's outside securities counsel, in light of changing
conditions, new legislation and other developments, the Company's Code of
Ethics, and make recommendations to the Board for such changes to or waivers of
the Code of Ethics as the Committee shall deem appropriate. The Nominating &
Corporate Governance Committee shall review whether the Company's Code of Ethics
has been communicated by the Company to all key employees of the Company with a
direction that all such key employees certify that they have read, understand
and are not aware of any violations of the Code of Ethics.
9. The Nominating & Corporate Governance Committee shall review
and reassess at least annually the adequacy of the Corporate Governance
Guidelines of the Company and recommend any proposed changes to the Board for
approval.
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10. The Nominating & Corporate Governance Committee shall report
its actions and any recommendations to the Board after each Committee meeting.
11. The Nominating & Corporate Governance Committee shall review
and reassess the adequacy of this Charter annually and recommend any proposed
changes to the Board for approval.
12. The Nominating & Corporate Governance Committee shall annually
review its own performance.
13. The Nominating & Corporate Governance Committee shall have the
authority to delegate any of its responsibilities to subcommittees as the
Committee may deem appropriate in its sole discretion.
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ANNEX C
FIRST BUSEY CORPORATION AMENDED AND RESTATED
AUDIT COMMITTEE CHARTER
The Audit Committee is appointed by the Board and has sole
responsibility for (1) monitoring the integrity of the financial statements of
the Company; (2) oversight of the Company's internal and external auditors; (3)
resolution of disagreements between management and the auditors regarding
financial reporting; and (4) the determination of the independence of the
external auditors.
The members of the Audit Committee shall meet the independence and
experience requirements of the Securities and Exchange Commission and the
national securities exchanges upon which the Company's common stock is listed
and trading, if any. The members of the Audit Committee shall be appointed by
the Board.
The Audit Committee shall have the authority to retain special legal,
accounting or other consultants to advise the Committee. The Audit Committee may
request any officer or employee of the Company or the Company's outside counsel
or external auditor to attend a meeting of the Committee or to meet with any
members of, or consultants to, the Committee.
The Audit Committee shall make regular reports to the Board.
The Audit Committee shall:
1. Review and reassess the adequacy of this Charter
annually and recommend any proposed changes to the Board for approval.
2. Review the annual audited financial statements with
management, including major issues regarding accounting and auditing
principles and practices as well as the adequacy of internal controls
that could significantly affect the Company's financial statements.
3. Review analyses prepared by management and the
external auditor of significant financial reporting issues and
judgments made in connection with the preparation of the Company's
financial statements.
4. Review with management and, the external auditor, the
Company's quarterly financial statements prior to the release of
quarterly earnings and subsequent filing of such release with the
Securities and Exchange Commission.
5. Meet periodically, as necessary, with management to
review the Company's major financial risk exposures and the steps
management has taken to monitor and control such exposures.
6. Review major changes to the Company's auditing and
accounting principles and practices as suggested by the external
auditor, internal auditor or management.
7. Direct the appointment of the external auditor, which
firm is ultimately accountable to the Audit Committee.
8. Review management's internal control report prior to
its inclusion in the Company's annual report, which addresses the
effectiveness of the Company's internal controls and procedures for
purposes of financial reporting.
9. Review pertinent documentation relating to
certificates of chief executive officer and chief financial officer of
the Company required under the Sarbanes-Oxley Act of 2002 and rules of
the Securities and Exchange Commission formulated thereunder, including
internal control disclosure.
10. Approve the fees to be paid to the external auditor.
11. Receive periodic reports from the external auditor
regarding the auditor's independence, discuss such reports with the
auditor, and take appropriate action to satisfy itself of the
independence of the auditor.
12. Evaluate the performance of the external auditor and,
if so determined, replace the external auditor.
13. Review the appointment and replacement of the senior
internal auditing executive.
14. Review the significant reports to management prepared
by the internal auditing department and management's responses.
15. Meet with the external auditor prior to the audit to
review the planning and staffing of the audit.
16. Obtain from the external auditor assurance that
Section 10A of the Private Securities Litigation Reform Act of 1995 has
not been implicated.
17. Obtain reports from management, the Company's senior
internal auditing executive and the external auditor that the Company's
subsidiary affiliated entities are in conformity with applicable legal
requirements and the Company's Code of Conduct.
18. Discuss with the independent auditor the matters
required to be discussed by Statement on Auditing Standards No. 61
relating to the conduct of the audit.
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19. Review with the external auditor any problems or
difficulties the auditor may have encountered and any management letter
provided by the auditor and the Company's response to that letter. Such
review should include:
(a) Any difficulties encountered in the course
of the audit work, including any restrictions on the scope of
activities or access to required information.
(b) Any changes required in the planned scope of
the internal audit.
(c) The internal audit department
responsibilities, budget and staffing.
(d) Any disagreements between management and the
external auditors, which disagreements shall be resolved by
the Audit Committee.
20. Issue the report required by the rules of the
Securities and Exchange Commission to be included in the Company's
annual proxy statement.
21. Advise the Board with respect to the Company's
policies and procedures regarding compliance with applicable laws and
regulations and with the Company's Code of Conduct.
22. Review with the Company's General Counsel legal
matters that may have a material impact on the financial statements,
the Company's compliance policies and any material reports or inquiries
received from regulators or governmental agencies.
23. Meet periodically, as necessary, with the chief
financial officer, the senior internal auditing executive and the
independent auditor in separate executive sessions.
24. Pre-approve all audit and non-audit services to be
performed by the Company's external auditors. The responsibilities of
pre-approval may be designated to one member of the Audit Committee
who, after giving such pre-approval, must report to the full Audit
Committee.
25. Review any and all reports issued by the external
auditors, with respect to the Company's financial statements and
critical accounting policies.
26. Establish reviews and adopt procedures to receive and
handle anonymous complaints about accounting, internal accounting
controls, or auditor matters.
While the Audit Committee has the responsibilities and powers set forth
in this Charter, 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 auditor.
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ANNEX D
FIRST BUSEY CORPORATION
2004 STOCK OPTION PLAN
1. Purpose of The Plan.
First Busey Corporation 2004 Stock Option Plan (herein called the
"Plan") of First Busey Corporation (herein called the "Company") and its
Subsidiaries is designed and intended (a) to encourage ownership of the
Company's Stock by employees and directors of the Company and its Subsidiaries,
and to provide additional incentive for them to promote the success of the
business of the Company, and (b) to attract personnel to enter and remain in the
employment of the Company and its Subsidiaries. It is expected that the added
interest of the participating Employees and Directors under this Plan, and their
proprietary attitude toward the Company resulting from their investment in the
Company's Stock, will promote the future growth, development and continued
success of the Company.
2. Definitions.
The following terms shall have the meanings hereinafter set forth
unless the context clearly indicates to the contrary:
(a) "Board of Directors" shall mean the Board of Directors of
First Busey Corporation.
(b) "Code" shall mean the Internal Revenue Code of 1986, as
amended.
(c) "Committee" shall mean the Compensation Committee of the Board
of Directors.
(d) "Company" shall mean First Busey Corporation.
(e) "Director" shall mean a member of the Board of Directors who
is not an Employee of the Company.
(f) "Employee" shall mean an individual who performs services for
the Company or one or more of its Subsidiaries. The term "Employee" shall also
mean an officer of the Company or one of its Subsidiaries.
(g) "Exchange Act" shall mean the Securities Exchange Act of 1934.
(h) "Option" shall mean an Option to purchase Stock granted
pursuant to the provisions of paragraph 6.
(i) "Optionee" shall mean an Employee or Director to whom an
Option has been granted pursuant to this Plan.
(j) "Stock" shall mean the Common Stock, without par value, of the
Company, or in the event that the outstanding shares of Stock are exchanged for
shares of a different stock or securities of the Company or some other
corporation, such other stock or securities.
(k) "Subsidiary" shall mean any subsidiary corporation of the
Company as defined in Section 424(f) of the Code.
(l) "Termination of Employment" shall mean the later of (i) a
severance of the employer-employee relationship with the Company or (ii) the
resignation, removal or termination of an officer or Director of the Company.
3. Stock Subject to the Plan.
One million (1,000,000) shares of Stock shall be reserved for issue
upon the exercise of Options granted under the Plan. In the event an Option is
exercised, the Company may use authorized but unissued shares or shares held in
treasury in lieu thereof. If any Option granted under the Plan shall expire or
terminate for any reason without having been exercised in full, the unpurchased
shares subject to such Option shall again be available for the purposes of the
Plan.
4. Administration of the Plan.
4.1. The Plan shall be administered by the Compensation Committee
of the Board of Directors consisting of not less than three (3) members. Each
member of such Committee shall be a non-employee director as defined in Rule
16b-3 of the Rules and Regulations of the Securities and Exchange Commission, as
amended from time to time.
4.2. The Committee shall be appointed by the Board of Directors in creating such series) be increased or decreased (but not below the number of the Company. The Board of Directors of the Company may, within the limits herein
provided,shares then outstanding) from time to time in its discretion, fix and change the number of
members of the Committee, remove members of the Committee, appoint members of
the Committee in substitution for or in addition to members previously
appointed, and fill vacancies however caused in the Committee.
4.3. The Board of Directors shall select one of the Committee
members as its chairman, and the Committee shall hold its meetings at such times
and places as it may determine. A majority of its members shall constitute a
quorum, but allby action of the CommitteeBoard of Directors;
b. The voting rights, if any, which shares of that series shall have, which may be special, conditional, limited or otherwise;
c. The rate of dividends, if any, on the shares of that series, whether dividends shall be taken by a majoritynon-cumulative, cumulative to the extent earned, partially cumulative or cumulative (and, if cumulative, from which date or dates), whether dividends shall be
A-2
payable in cash, property or rights, or in shares of its
members. Any action, decisionthe Corporation’s capital stock, and the relative rights of priority, if any, of payment of dividends on shares of that series over shares of any other series or determination reduced to writing and signed by
all membersover the Common Stock;
d. Whether the shares of that series shall be fully as effective asredeemable and, if it had been done or made by a vote
of a majority ofso, the members at the meeting duly called and held. The Committee
may appoint a secretary, and shall keep minutes of its meetings and actions, and
shall make such rules and regulations for the conduct of the business of the
Committee as it deems advisable. The secretary may be, but need not be, an
Employee of the Company or a Subsidiary. Serving as secretary of the Committee
shall not disqualify an Employee from receiving an Option under the Plan.
D-2
4.4. Subject to the express provisions of the Plan, the Committee
shall have plenary authority, in its sole discretion, to determine the
individuals to whom Options shall be granted, the number of shares subject to
each Option, the Option exercise price, the time or times at which Options shall
be granted, and the other terms and conditions of such Options. Subject toredemption, including the express provisionsdate or dates upon or after which they shall be redeemable, the event or events upon or after which they shall be redeemable, whether they shall be redeemable at the option of the Plan,Corporation, the Committeestockholder or another person, the amount per share payable in case of redemption (which amount may vary under different conditions and at different redemption dates), whether such amount shall alsobe a designated amount or an amount determined in accordance with a designated formula or by reference to extrinsic data or events and whether such amount shall be paid in cash, indebtedness, securities or other property or rights, including securities of any other corporation;
e. Whether that series shall have plenary authority,
in its discretion,a sinking fund for the redemption or purchase of shares of that series and, if so, the terms of and amounts payable into such sinking fund;
f. The rights to construe and interpretwhich the Plan, to make determinations in
administrationholders of the Plan, to make, amendshares of that series shall be entitled in the event of voluntary or involuntary dissolution or liquidation of the Corporation, and rescind rulesthe relative rights of priority, if any, of payment of shares of that series over shares of any other series or over the Common Stock in any such event;
g. Whether the shares of that series shall be convertible into or exchangeable for cash, shares of stock of any other class or any other series, indebtedness, or other property or rights, including securities of another corporation, and, regulations
regarding the Plan and its administration, to determineif so, the terms and conditions of such conversion or exchange, including the rate or rates of conversion or exchange, and whether such rate shall be a designated amount or an amount determined in accordance with a designated formula or by reference to extrinsic data or events, the date or dates upon or after which they shall be convertible or exchangeable, the duration for which they shall be convertible or exchangeable, the event or events upon or after which they shall be convertible or exchangeable, and whether they shall be convertible or exchangeable at the option of the Corporation, the stockholder or another person, and the method (if any) of adjusting the rate of conversion or exchange in the event of a stock split, stock dividend, combination of shares or similar event;
h. Whether the issuance of any additional shares of such series, or of any shares of any other series, shall be subject to restrictions as to issuance, or as to the powers, preferences or rights of any such other series; and
i. Any other preferences, privileges and powers and relative, participating, optional or other special rights and qualifications, limitations or restrictions of such series, as the Board of Directors may deem advisable and as shall not be inconsistent with the provisions of this Article and to the respective Stock Option agreements (which needfull extent now or hereafter permitted by the laws of the State of Nevada.
A-3
Fifth.The number of directors shall be fixed by, or in the manner provided in, the By-Laws.
Sixth.The Corporation shall have perpetual existence.
Seventh.The stockholders, officers or directors of the Corporation shall not be identical), and to
take whatever action is necessary to carry outpersonally liable for the purposespayment of the Plan;
provided, however,Corporation’s debts except as they may be liable by reason of their own conduct or acts.
Eighth.The Board of Directors is expressly authorized and empowered to make, alter and repeal the Committee shall take no action which will impair any
Option previously granted under the Plan or cause the Plan to not meet the
requirements of Rule 16b-3By-Laws of the Rules and Regulations of the Securities and
Exchange Commission. The Committee's actions and determinations on matters
referred to in this section shall be conclusive on all persons whomsoever. No
act or failure to act on the part of the Committee, or on the part of any member
thereof, shall result in any liability whatsoever if taken in good faith.
5. Type of Option Granted By The Plan.
The Committee shall have authority to grant Options which do not
qualify as incentive stock options as defined in Section 422 of the Code.
6. Eligibility to Receive Options Under The Plan.
6.1. Options may be granted under the Plan to any Employee or
Director of the Company or any of its Subsidiaries. An Option may be granted to
an individual upon the condition that such individual will become an Employee or
Director of the Company or any of its Subsidiaries; provided, however, that such
a conditional Option shall be deemed to be granted only on the date such
individual becomes an Employee or Director.
6.2. In making a determination as to persons to whom Options shall
be granted under the Plan, and the number of shares to be covered by such
Options, the Committee shall take into consideration the nature of the services
rendered or to be rendered by the Employee or Director, the Employee's or
Director's present and potential contributions to the success of the Company,
and such other factors as the Committee shall deem relevant in accomplishing the
purposes of the Plan. Any and all determinations made by the Committee pursuant
to this section shall be binding upon all persons whomsoever, and no Employee or
Director eligible to receive an Option under the Plan shall have any legal right
to complain as to any determination which shall be made by the Committee
hereunder with respect to such Employee or Director.
6.3. Nothing contained in the Plan shall be construed to limit the
right of the Company to grant Options otherwise than under the Plan in
connection with (a) the employment or directorship of any person, (b) the
acquisition of any corporation, firm or association, or the business or assets
thereof, including Options granted to employees thereof who become employees of
the Company or a Subsidiary, or (c) other proper corporate purposes.
D-3
7. Option Price.
7.1. The purchase price of the Stock subject to each Option granted
hereunder shall be equal to at least 100% of the fair market value of the Stock
at the time of the grant of the Option.
7.2. The Committee shall adopt criteria for the determination of
the fair market value of Stock subject to any Option granted pursuant to this
Plan; provided, however, if the Stock is quoted on the National Association of
Securities Dealers Automated Quotation System ("Nasdaq National Market") or any
national securities exchange, the fair market value shall be the closing price
on the date of such grant.
8. Term of Options.
8.1. Except as provided in paragraph 6.1, the term of each Option
granted pursuant to the Plan shall not exceed ten (10) years from the date of
granting thereof. Within such ten-year limit, Options will be exercisable only
at such time or times,Corporation, subject to the restrictions of paragraphs 10, 11 and 12,
and any other restrictions and conditions, as the Committee shall in each
instance approve, which need not be uniform for all individuals to whom Options
are granted.
8.2. Except as provided in paragraphs 11 and 12, no Option may be
exercised at any time unless the Optionee is then an Employeepower of the Company or
a Subsidiary or a Directorstockholders of the CompanyCorporation, to alter or a Subsidiary and has been so
employed or has been a Director continuously since the grantingrepeal any By-Laws of the Option.
9. Date of Grant of Option.
Corporation.
Ninth.The grant of an Option underCorporation reserves the Plan shall take place on or as of the
date the Committee grants an Employee or Director a particular Option; provided,
however, that if the resolution or other written determination of the Committee
specifies that an Option is to be granted as of and at some future date, the
date of grant shall be such future date.
10. Exercise of Option.
10.1. Except as provided in paragraphs 11 and 12, unless otherwise
provided in the terms under which the Committee granted the Option, each Option
shall be exercisable in whole (i.e. the rights for all shares subject to any one
Option must be exercised in full) onlyright at any time and from time to time on a
date specifiedto amend, alter, change or repeal any provision contained in the relevant Option AgreementArticles of Incorporation and provided in paragraph 10.2,
which shall be a date no earlier than six months after the date of grant of such
Option.
10.2. To the extent that the right to purchase shares under an
Option granted under the Plan is exercisable, in order to exercise an option,
the Optionee must provide written notice to the Company in accordance with the
rules and procedures establishedadd or insert any other provision authorized by the Committee. Such notice tolaws of the Company
shall stateState of Nevada in the number and identitymanner now or hereafter prescribed by law. All rights, preferences or privileges of Stock with respect to which the
D-4
Option is being exercised, and shall be accompanied by payment in full in cashwhatever nature conferred upon stockholders, directors or in any other persons whomsoever by and pursuant to these Articles of Incorporation in its present form and termor as the Committee shall permit.
10.3. After the exercise of an Option, the Company shall within a
reasonable time deliver to the person exercising the Option a certificate or
certificates issued in the name of the person who exercised the Option for the
appropriate number of shares. Each Optionhereafter amended are granted under the Plan shall be subject to the requirement rights now reserved in this Article.
Tenth.No director or officer shall be liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty,providedthat if at any timethis Section shall not eliminate or limit the Boardliability of Directorsa director or officer for (i) acts or omissions which involve intentional misconduct, fraud or a knowing violation of the
Company shall determine that the listing, registration or qualification of the
shares subject to such Option upon any securities exchange or under any state or
Federal law or the consent or approval of any governmental regulatory body, is
necessary or desirable, as a condition of, or in connection with, the granting
of such Option or the issue or purchase of shares thereunder, no such Option may
be exercised unless such listing, registration, qualification, consent or
approval shall have been effected or obtained free of any conditions not
acceptable to the Board of Directors.
10.4. An Optionee under an Option granted under the Plan shall have
no rights as a shareholder with respect to any shares covered by an Option until
one or more certificates for shares shall have been delivered to the Optionee
upon due exercise of an Option as above provided.
10.5. An Option granted under the Plan shall be nontransferable by
the Optionee other than by will or the laws of descent and distribution, and
shall be exercised during the Optionee's lifetime only by the Optionee, unless
the Optionee is under legal disability, in which case it may be exercised by the
Optionee's duly appointed legal representative.
11. Termination of Employment.
11.1. Except in the case of disability or death, as provided in
paragraphs 11.2 and 12, if an Optionee of an Option granted under the Plan has a
Termination of Employment with the Company or a Subsidiary, then all Options
granted to such person under the Plan shall terminate and expire as of the date
the Optionee ceases to be an Employee or a Director, unless otherwise provided
by the Committee in its sole discretion.
11.2. If an Optionee becomes permanently and totally disabled, all
Options which are not presently exercisable shall become exercisable on the date
the Optionee has a Termination of Employment because of such disability. Any
unexercised Option held by such disabled Optionee shall expire not later than
180 days after the Optionee has a Termination of Employment because of such
disability; provided, however, no Option may be exercised after the expiration
date specified for the particular Option in the Option grant.
11.3. The transfer of an Employee from one corporation to another
among the Company and its Subsidiaries, or a leave of absence (as described in
Section 1.421-7(h)(2) of the Income Tax Regulations) with the written consent of
the Company or a Subsidiary shall not be deemed a Termination of Employment for
the purposes of the Plan, and an option agreement may provide that retirement at
a time when the Optionee is eligible for an immediate retirement benefit under
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any retirement plan of the Company shall not be a Termination of Employment for
purposes of an Option.
12. Death of Optionee.
12.1. If an Optionee under the Plan dies while an Employee or
Director of the Company or a Subsidiary, all Options which are not presently
exercisable shall become exercisable on the date of the Optionee's death. The
shares which the Optionee was or becomes entitled to purchase on the date of the
Optionee's death under an Option or Options granted under the Plan may be
purchased at any time after the Optionee's death by the person or persons to
whom said rights under the Option or Options shall have passed by the Optionee's
will or by the applicable laws of descent and distribution; provided, however,
that any unexercised Option held by an Optionee who dies shall expire not later
than 180 days after the date of the Optionee's death, and that no Option may be
exercised after the expiration date specified for the particular Option in the
Option grant.
13. Effect of Merger, Change in Capitalization, Etc.
13.1. In the event of any reclassification or increase or decrease
in the number of the issued shares of Stock of the Company by reason of(ii) the payment of a Stock dividend, a split or consolidationdistributions in violation of shares, a
recapitalization, a combination or exchange of shares or any like capital
adjustment, then (a) the aggregate number and the class of shares reserved under
the Plan shall be as though the shares reserved had been outstanding prior to
any adjustment as aforesaid, and (b) as to any outstanding unexercised Options
theretofore granted under the Plan, there shall be a corresponding adjustment as
to the class and number of shares covered by each Option, and as to the purchase
price under each Option, to the end that the Optionee's proportionate interest
shall be maintained as before the occurrence of such event without change in the
total purchase price applicable to said Option.
13.2. In the event the Company shall approve a plan of
reorganization or of merger into or consolidation with any other corporation,
and appropriate provision is made for the resulting corporation's assumptionSection 78.300 of the Plan under terms wherebyNevada Revised Statutes.
Eleventh.Meetings of stockholders may be held within or without the unexercised portionState of each Option then
outstanding underNevada, as the Plan shall thereafter apply to such number and kind of
securities as would have been issuable by reason of such reorganization, merger
or consolidation to a holderBy-Laws of the number of shares which were subject to the
Option immediately prior to such reorganization, merger or consolidation,
without change in the total purchase price applicable to said Option, then such
Options shall continue under the Plan.
13.3. In the event the Company shall approve a plan of
reorganization or of merger into or consolidation with any other corporation,
and appropriate provision is not made for the assumptionCorporation may provide. The books of the Plan byCorporation may be kept outside the resulting corporationState of Nevada at such place or places as above provided in paragraph 13.2, or in the event the
Company shall approve a plan of dissolution, liquidation or sale of
substantially all of its assets, then in any event, the unexercised portion of
each Option then outstanding under the Plan shall terminate as of a date fixed
by the Committee and approvedmay be designated from time to time by the Board of Directors or in the By-Laws of the Company uponCorporation, except as otherwise required by the Nevada Revised Statutes. Election of directors need not less than thirty days'be by written noticeballot unless the By-Laws of the Corporation so provide.
Twelfth.The Corporation expressly elects not to each Optionee; provided, however, that
any such Option shall be accelerated andgoverned by Sections 78.411-78.444, inclusive, of the Nevada Revised Statutes, as the same may be exercised beforeamended or supplemented from time to time.
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Thirteenth.The Corporation shall, to the termination
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date fixed as aforesaid; provided further, however, that such termination date
shall be fixed as of a date on or before the effective date of such
reorganization, merger, consolidation, dissolution, liquidation or sale.
13.4. In the event the Company shall issue additional capital Stock
of any class for cash or other consideration, there shall be no adjustment in
the number of shares coveredfullest extent permitted by outstanding Options under the Plan, and no
adjustment in the purchase price under such Options.
14. Termination and Amendment of The Plan.
14.1. This Plan shall terminate ten years from the date the Plan was
adopted by the Board of Directors, and no Option shall be granted hereunder
after said date, but such termination shall not affect any Option theretofore
granted. The Board of DirectorsSection 78.751 of the CompanyNevada Revised Statutes, as the same may suspend, discontinuebe amended or terminate the Plan at any time, and maysupplemented from time to time, makeindemnify any and all persons whom it shall have power to indemnify under said section from and against any and all of the expenses, liabilities or other matters referred to in or covered by said Section 78.751, and the indemnification provided for herein shall not be deemed exclusive of any other rights to which those indemnified may be entitled under any By-Laws, agreement, vote of stockholders or disinterested directors or otherwise, both as to action in his or her official capacity and as to action in another capacity while holding such changes inoffice, and additionsshall continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the Plan as the Board of Directors shall deem advisable;
provided, however, that the Board of Directors may not, without approval by the
shareholdersbenefit of the Company, change any provision which otherwise requires
shareholder approval in accordance with applicable rulesheirs, executors and regulations.
14.2. Subject to other provisionsadministrators of the Plan, no termination or
amendment of the Plan may, without the consent of the Optionee under an Option
then outstanding, terminate such Option or materially and adversely affect the
rights of the Optionee thereunder.
15. Shareholder Approval.
Notwithstanding any other provision of this Plan, no Option granted
under this Plan may be exercised until this Plan is approved by vote of a majority of the total votes cast by the shareholders of the Company at the
Company's Annual Meeting to be held on April 13, 2004. In the event such
shareholder approval is not forthcoming at the Company's Annual Meeting to be
held on April 13, 2004, this Plan and any Options granted pursuant to it shall
be null and void.
16. Amendments to Code or Regulations.
Any reference in this Plan to a section of the Code or a section of the
Income Tax Regulations shall include any amendments thereto and shall include
such additional sections of the Code or Regulations into which the substance of
the cited subsections shall be incorporated.
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PROXY--FIRSTperson.
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2005 PROXY—FIRST BUSEY CORPORATION
KNOW ALL MEN BY THESE PRESENTS, THAT I, the undersigned stockholder of First Busey Corporation (the "Company"“Company”) having received notice of the Annual Meeting of Stockholders, do hereby nominate, constitute and appoint, Tom Brown and Tom Berns, my true and lawful attorney and proxy, with full power of substitution, for me and in my name, place and stead to vote all of the shares of Common Stock without par value ("(“Common Stock"Stock”) of the Company standing in my name on its books on February 27, 2004March 1, 2005 at the Annual Meeting of Stockholders of the Company, to be held at the Virginia Theatre, 203 W. Park,Champaign Country Club, 1211 S. Prospect Avenue, Champaign, Illinois, on April 13, 200426, 2005 at 7:12:00 p.m., local time, and at any postponement or adjournment thereof, with all powers the undersigned would possess if personally present, as follows:
1. [ ] FOR all nominees listed below to serve as directors of the Company
until the next Annual Meeting of Stockholders (except as marked to the
contrary below)
[ ] WITHHOLD AUTHORITY to vote for all nominees listed below
Joseph M. Ambrose David L. Ikenberry E. Phillips Knox
V. B. Leister Douglas C. Mills Joseph E. O'Brien
Arthur R. Wyatt
(INSTRUCTION: To withhold authority to vote for any individual nominee,
strike a line through that nominee's name.)
2. Approval of the First Busey Corporation 2004 Stock Option Plan
[ ] FOR [ ] AGAINST [ ] ABSTAIN
To transact such other business as may properly come before the Annual
Meeting or any postponement or adjournment thereof.
1. o FORall nominees listed below to serve as directors of the Company until the next Annual Meeting of Stockholders (except as marked to the contrary below) o WITHHOLD AUTHORITYto vote for all nominees listed below Joseph M. Ambrose David L. Ikenberry E. Phillips Knox V. B. Leister Douglas C. Mills Joseph E. O’Brien Arthur R. Wyatt (INSTRUCTION: To withhold authority to vote for any individual nominee, strike a line through that nominee’s name.) 2. Approval of the proposed Amended and Restated Articles of Incorporation of the Company, which increases the per value of the Company’s capital stock from no par value to $.001 per value. o FOR o AGAINST o ABSTAIN To transact such other business as may properly come before the Annual Meeting or any postponement or adjournment thereof.
This proxy will be voted as directed, or if no instructions are given, it will be voted "FOR"“FOR” election of all nominees as Directors of First Busey Corporation. Also, this proxy will be voted at the Annual Meeting in accordance with the Board of Directors'Directors’ recommendations on any other matters which may come before the Annual Meeting or any postponement or adjournment thereof.
This proxy is solicited on behalf of the Board of Directors and may be revoked prior to its exercise.
Your vote is important. Any previously submitted proxies will not be used at the Annual Meeting. Accordingly, even if you plan to attend the Annual Meeting, please mark, sign and date this proxy and return it in the enclosed envelope.
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Please sign your name or names exactly as
they appear on the stock certificate. Each
joint tenant must sign. When signing as
attorney, administrator, guardian, executor
or trustee or as an officer of a corporation,
please give full title. If more than one
trustee, all should sign.
| Please sign your name or names exactly as they appear on the stock certificate. Each joint tenant must sign. When signing as attorney, administrator, guardian, executor or trustee or as an officer of a corporation, please give full title. If more than one trustee, all should sign. | ||
| Number Planning to Attend Annual Shareholders Meeting on Tuesday, April 26, 2005 at 12:00 p.m. at Champaign Country Club, 1211 S. Prospect Avenue, Champaign, Illinois. |