<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant / /
Filed by a party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-12
Main Street Trust, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11
(1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
(5) Total fee paid:
------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
(3) Filing Party:
------------------------------------------------------------------------
(4) Date Filed:
------------------------------------------------------------------------
<PAGE>
MAIN STREET TRUST, INC.
May 15, 2000
Dear Fellow Shareholder:
On behalf of the board of directors and management of Main Street Trust,
Inc., I cordially invite and encourage you to attend the annual meeting of
shareholders of Main Street, to be held at 7:00 p.m. on Tuesday, June 20, 2000,
at The Forum at Carle, 611 West Park Street, Urbana, Illinois. A reception will
be held beginning at 6:00 p.m. where you can meet and talk with directors and
other members of management. The accompanying Notice of Annual Meeting of
Shareholders and Proxy Statement discuss the business to be conducted at the
meeting. At the meeting we shall report on our operations, our progress
following our March 23, 2000 merger of BankIllinois Financial Corporation and
First Decatur Bancshares, Inc. and the outlook for the year ahead. This is an
exciting time for us as Main Street now ranks as one of the largest independent
financial services companies in Illinois.
Your board of directors has nominated four persons to serve as Class I
directors. Each of the nominees are incumbent directors. The board of directors
has also approved the adoption of a stock incentive plan, which must be approved
by the shareholders to become effective. We recommend that you vote your shares
for the director nominees and in favor of the stock incentive plan.
We encourage you to attend the meeting in person. HOWEVER, WHETHER OR NOT
YOU PLAN TO ATTEND, PLEASE COMPLETE, SIGN AND DATE THE ENCLOSED PROXY AND RETURN
IT IN THE ACCOMPANYING POSTPAID RETURN ENVELOPE AS PROMPTLY AS POSSIBLE. This
will ensure that your shares are represented at the meeting.
If you have any questions concerning these matters, please do not hesitate
to contact me at (217) 351-6500. We look forward to the opportunity to visit
with you.
Sincerely,
/s/ Van A. Dukeman
Van A. Dukeman
President and Chief Executive Officer
- --------------------------------------------------------------------------------
100 West University Avenue o Champaign, IL 61820 o Phone: (217) 351-6500
<PAGE>
MAIN STREET TRUST, INC.
100 WEST UNIVERSITY AVENUE
CHAMPAIGN, ILLINOIS 61820
(217) 351-6500
NOTICE OF
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD JUNE 20, 2000
To the Shareholders of
MAIN STREET TRUST, INC.
The annual meeting of the shareholders of Main Street Trust, Inc., an
Illinois corporation, will be held at The Forum at Carle, 611 West Park Street,
in Urbana, Illinois, on Tuesday, June 20, 2000, at 7:00 p.m., local time, for
the following purposes:
1. to elect four Class I directors for a term of three years.
2. to approve the Main Street Trust, Inc. 2000 Stock Incentive Plan.
3. to transact such other business as may properly be brought before the
meeting and any adjournments or postponements of the meeting.
The board of directors has fixed the close of business on May 1, 2000, as
the record date for the determination of shareholders entitled to notice of, and
to vote at, the meeting. In the event there are not sufficient votes for a
quorum or to approve or ratify any of the foregoing proposals at the time of the
meeting, the meeting may be adjourned or postponed in order to permit further
solicitation of proxies.
By Order of the Board of Directors
/s/ Van A. Dukeman
Van A. Dukeman
President and CEO
Champaign, Illinois
May 15, 2000
<PAGE>
PROXY STATEMENT
This proxy statement is furnished in connection with the solicitation by
the board of directors of Main Street Trust, Inc. of proxies to be voted at the
annual meeting of shareholders to be held at The Forum at Carle, 611 West Park
Street, Urbana, Illinois, on Tuesday, June 20, 2000, at 7:00 p.m., local time,
and at any adjournments or postponements of the meeting.
The board of directors would like to have all shareholders represented at
the meeting. Regardless of whether you expect to be present, please sign and
mail your proxy card in the enclosed self-addressed, postage-paid envelope to:
Main Street Trust, Inc., 100 West University Avenue, Champaign, Illinois 61820,
Attention: Mr. Van A. Dukeman, President and Chief Executive Officer. You have
the power to revoke your proxy at any time before it is voted, and the giving of
a proxy will not affect your right to vote in person if you attend the meeting.
The mailing address of Main Street's principal executive offices is 100
West University Avenue, Champaign, Illinois 61820. This proxy statement and the
accompanying proxy card are being mailed to shareholders on or about May 15,
2000.
Only holders of Main Street's common stock, par value $0.01 per share, of
record at the close of business on May 1, 2000, will be entitled to vote at the
annual meeting or any adjournments or postponements of the meeting. On May 1,
2000, Main Street had 10,067,001 shares of common stock issued and outstanding.
In the election of the directors, and for all other matters to be voted upon at
the meeting, each issued and outstanding share of common stock is entitled to
one vote. All shares of common stock represented at the annual meeting by
properly executed proxies received prior to or at the meeting, and not revoked,
will be voted at the meeting in accordance with the instructions thereon. If no
instructions are indicated, properly executed proxies will be voted for the
nominees and for adoption of the proposal set forth in this proxy statement.
A majority of the shares of the common stock, present in person or
represented by proxy, shall constitute a quorum for purposes of the annual
meeting. Abstentions and broker non-votes will be counted for purposes of
determining a quorum. Directors shall be elected by a plurality of the votes
present in person or represented by proxy to vote. In all matters other than the
election of directors, the affirmative vote of the majority of shares present in
person or represented by proxy at the annual meeting and entitled to vote on the
subject matter shall be required to constitute shareholder approval. Abstentions
will be treated as votes against a proposal and broker non-votes will have no
effect on the vote.
Main Street Trust, Inc. was incorporated under the laws of the state of
Illinois in August, 1999 to be the surviving corporation of the merger by and
between BankIllinois Financial Corporation and First Decatur Bancshares, Inc.
This merger was completed on March 23, 2000. As a result of the merger
transaction, Main Street became the holding company of BankIllinois, an Illinois
state bank, the First National Bank of Decatur, a national banking organization,
and the First Trust Bank of Shelbyville, an Illinois state bank. In addition,
Main Street also is the parent company for FirsTech, Inc., a remittance
processing company.
ELECTION OF DIRECTORS
At the annual meeting of the shareholders to be held on June 20, 2000, the
shareholders will be entitled to elect four Class I directors for a term
expiring in 2003. The directors of Main Street are divided into three classes
having staggered terms of three years. Each of the nominees for election as
Class I directors are incumbent directors. Main Street has no knowledge that any
of the nominees will refuse or be unable to serve, but if any of the nominees
becomes unavailable for election, the holders of the proxies reserve the right
to substitute another person of their choice as a nominee when voting at the
meeting.
Set forth below is information, as of May 1, 2000, concerning the nominees
for election and for the other persons whose terms of office will continue after
the meeting, including age, year first elected a director of either
<PAGE>
BankIllinois Financial or First Decatur as well as each director's business
experience during the previous five years. Each nominee, if elected at the
annual meeting, will serve as a Class I director for a three year term
expiring in 2003.
The board of directors recommends a vote FOR each of the nominees.
NOMINEES
<TABLE>
<CAPTION>
POSITION WITH MAIN STREET, ITS SUBSIDIARIES
AND THE PREDECESSOR COMPANIES
NAME DIRECTOR AND OCCUPATION FOR
(AGE) SINCE(1) THE LAST FIVE YEARS
<S> <C> <C>
CLASS I
(TERM EXPIRES 2003)
Frederic L. Kenney 1996 Director of Main Street; Director of First Decatur
(Age 41) (1996-2000); Attorney for Winters, Featherstun, Gaumer,
Kenney, Postlewait and Stocks (1983-present)
Gregory B. Lykins 1994 Director, Vice Chairman of the Board of Main Street; Director
(Age 52) and Chairman of the Board of BankIllinois Financial and
BankIllinois (1998-2000); Director, Chairman of the Board and
Chief Executive Officer of BankIllinois Financial and
BankIllinois (1994-1998)
August C. Meyer, Jr. 1962 Director of Main Street; Director of BankIllinois Financial
(Age 62) (1962-2000); President, Midwest Television, Inc.
(1976-present)
Phillip C. Wise 1999 Director and Executive Vice President of Main Street;
(Age 61) Director and President of First Decatur (1999-2000); Senior
Vice President of First Decatur (1997-1999); President of
First of America Bank (1967-1997)
CONTINUING DIRECTORS
CLASS II
(TERM EXPIRES 2001)
George T. Shapland 1994 Director of Main Street; Director of BankIllinois Financial
(Age 69) (1994-2000); President, Shapland Management Co. (1990-present)
Thomas G. Sloan 1995 Director of Main Street; Director of First Decatur
(Age 51) (1995-2000); President and Chief Executive Officer of Sloan
Implement Co., Inc. (a John Deere implement dealer in
Assumption, Illinois) (1971-present)
Roy V. Van Buskirk 1991 Director of Main Street; Director of BankIllinois Financial
(Age 69) (1991-2000); Chief Executive Officer of Bacon and Van Buskirk
Glass Company, Illini Pella, Inc. and Danville Bacon and Van
Buskirk Glass Company, Inc. (1968-1997)
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
POSITION WITH MAIN STREET, ITS SUBSIDIARIES
AND THE PREDECESSOR COMPANIES
NAME DIRECTOR AND OCCUPATION FOR
(AGE) SINCE(1) THE LAST FIVE YEARS
<S> <C> <C>
H. Gale Zacheis 1990 Director of Main Street; Director of First Decatur
(Age 61) (1990-2000); practicing surgeon and physician in Decatur,
Illinois (1973-present)
CLASS III
(TERM EXPIRES 2002)
David J. Downey 1992 Director of Main Street; Director of BankIllinois Financial
(Age 58) (1992-2000); President of The Downey Group, Inc. (estate
planning, wealth transfer and executive compensation
organization) (1963-present)
Van A. Dukeman 1994 Director, President and Chief Executive Officer of Main
(Age 41) Street and BankIllinois; Director, President and Chief
Executive Officer of BankIllinois Financial and BankIllinois
(1998-2000); Director and President of BankIllinois Financial
and BankIllinois (1994-1998)
Larry D. Haab 1987 Director of Main Street; Director of First Decatur
(Age 62) (1987-2000); Director, President and Chief Executive Officer
of Illinois Power Company (a public electric and gas utility)
(1991-1998); Director of Illinova, the holding company of Illinois
Power Company; consultant to Illinova (1998-present)
John W. Luttrell 1962 Director and Chairman of the Board of Main Street; Director
(Age 68) and Chairman of the Board of First Decatur and the First
National Bank of Decatur (1999-2000); Director, President and
Chief Executive Officer of First Decatur (1994-1999);
Director, President and Chief Executive Officer of the First
National Bank of First Decatur (1967-1997)
Gene A. Salmon 1991 Director of Main Street; Director of BankIllinois Financial
(Age 55) (1991-2000); President, Cross Construction, Inc.
(1979-present)
</TABLE>
- -----------------------------
(1) Indicates the year first elected to the board of directors of BankIllinois
Financial Corporation or First Decatur Bancshares, Inc., the predecessor
companies to Main Street.
All of Main Street's directors will hold office for the terms indicated, or
until their respective successors are duly elected and qualified, and all
executive officers hold office for a term of one year. There are no arrangements
or understandings between any of the directors, executive officers or any other
person pursuant to which any of Main Street's directors or executive officers
have been selected for their respective positions. Non-employee directors of
Main Street will receive no cash compensation for their service in 2000.
Non-employee directors have received fully vested options to purchase 5,000
shares of common stock for serving on the boards of directors and committees of
Main Street and its subsidiaries. It is anticipated that options will be granted
to the directors as compensation in the future on an annual basis. Other than
Mr. Luttrell, who received fully vested
3
<PAGE>
options to purchase 5,000 shares of common stock, directors of Main Street who
are also employees were not separately compensated for service on such boards or
committees.
BOARD COMMITTEES AND MEETINGS
A total of eleven regularly scheduled and special meetings were held by the
board of directors of BankIllinois Financial during 1999, and a total of
thirteen regularly scheduled and special meetings were held by the board of
directors of First Decatur in 1999. During 1999, all directors for both
BankIllinois Financial and First Decatur attended at least 75% of the meetings
of the board and the committees on which they served. Main Street has an audit
committee and a compensation committee, which are both modeled after the
committees established by BankIllinois Financial.
Members of the Main Street audit committee for 2000 are Messrs. H. Gale
Zacheis (Chair), Gene A. Salmon, Thomas G. Sloan and Roy V. Van Buskirk, and
Messrs. Van A. Dukeman, Gregory B. Lykins and Phillip C. Wise serve EX OFFICIO..
The audit committee reports to the board of directors and has the responsibility
to review and approve internal control procedures, accounting practices and
reporting activities of the subsidiaries. The committee also has the
responsibility for establishing and maintaining communications between the board
and the independent auditors and regulatory agencies. The audit committee
reviews with the independent auditors the scope of their examinations, with
particular emphasis on the areas to which either the audit committee or the
auditors believe special attention should be directed. McGladrey & Pullen LLP
served as the independent auditor for BankIllinois Financial in 1999. The audit
committee also reviews the examination reports of regulatory agencies and
reports to the full board regarding matters discussed therein. Finally, it
oversees the establishment and maintenance of effective controls over the
business operations of the subsidiaries. The audit committee for BankIllinois
Financial met four times in 1999.
The members of the Main Street compensation committee for 2000 are Messrs.
Roy V. Van Buskirk (Chair), David J. Downey, Larry D. Haab, Frederic L. Kenney
and August C. Meyer, Jr., and Messrs. Van A. Dukeman, Gregory B. Lykins and
Phillip C. Wise serve EX OFFICIO.. The compensation committee reports to the
board of directors and has responsibility for all matters related to
compensation of executive officers of Main Street, including review and approval
of base salaries, review of salaries of executive officers compared to other
financial services holding companies in the region, fringe benefits, including
modification of the retirement plan, and incentive compensation. The
compensation committee also reviews compensation to be paid to Main Street's
directors for service on the board of directors and attendance at board and
committee meetings. The compensation committee for BankIllinois Financial met
two times in 1999.
Main Street's full board of directors will consider nominations to the
board submitted by shareholders if nominations are made in writing and otherwise
comply with Section 3.4 of Main Street's bylaws.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Directors and officers of BankIllinois Financial and First Decatur and
their respective subsidiaries were customers, of and had transactions with,
BankIllinois Financial and First Decatur during 1999. Additional transactions
may be expected to take place in the future with Main Street. All outstanding
loans, commitments to loan, transactions in repurchase agreements and
certificates of deposit and depository relationships, in the opinion of
management, were made in the ordinary course of business, on substantially the
same terms, including interest rates and collateral, as those prevailing at the
time for comparable transactions with other persons and did not involve more
than the normal risk of collectibility or present other unfavorable features.
Management believes that the terms of these services were no less favorable to
BankIllinois Financial or First Decatur than would have been obtained from
non-affiliated parties.
During 1999, BankIllinois Financial incurred approximately $64,000 in
construction costs for services provided by Cross Construction, Inc. Mr. Salmon,
a former director of BankIllinois Financial, serves as the President of Cross
Construction. In November 1999, BankIllinois entered into a lease agreement with
Midwest Television, Inc. for office space located in BankIllinois' and Main
Street's main office building located at 100
4
<PAGE>
West University Avenue, Champaign. Mr. Meyer, a director of Main Street, serves
as president of Midwest Television, Inc., and owns 100% of Midwest Television,
Inc., individually, and as trustee. Lease payments will total approximately
$82,000 annually. In addition, BankIllinois leases space from Mr. Meyer in a
building which is used for BankIllinois' campus branch banking operations, with
lease payments totaling approximately $54,000 annually. Mr. Robert M. Pancoast,
Director and President of First Trust Bank of Shelbyville, owns and operates
Shelbyville Abstract and Title Corporation, a real estate abstract and title
company located in Shelbyville, Illinois, which does real estate work for First
Bank and Trust of Shelbyville. Management believes that the terms of these
services were no less favorable to BankIllinois Financial, First Decatur or Main
Street than would have been obtained from non-affiliated parties.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth certain information regarding Main Street's
common stock beneficially owned on May 1, 2000 with respect to all persons known
to Main Street to be the beneficial owner of more than five percent of the
common stock, each director and nominee and all directors and executive officers
of Main Street as a group.
<TABLE>
<CAPTION>
NAME OF INDIVIDUAL AND AMOUNT AND NATURE OF PERCENT
NUMBER OF PERSONS IN GROUP BENEFICIAL OWNERSHIP(1) OF CLASS
- -------------------------- ----------------------- --------
<S> <C> <C>
DIRECTORS AND NOMINEES
David J. Downey(2) 327,393 3.2%
Van A. Dukeman(3) 199,006 2.0%
Larry D. Haab(4) 13,353 *
Frederic L. Kenney(5) 36,861 *
John W. Luttrell(6) 84,899 *
Gregory B. Lykins(7) 416,776 4.1%
August C. Meyer, Jr.(8) 1,653,575 16.4%
Gene A. Salmon 104,072 1.0%
George T. Shapland 325,957 3.2%
Thomas G. Sloan 35,525 *
Roy V. Van Buskirk 45,405 *
Phillip C. Wise(9) 6,197 *
H. Gale Zacheis(10) 17,939 *
NAMED EXECUTIVE OFFICERS
David B. White 23,142 *
Milton J. Brahier(11) 18,412 *
All directors and executive
officers as a group
(15 persons) 3,308,512 31.5%
</TABLE>
- ----------------------
* Less than one percent.
(1) The information contained in this column is based upon information
furnished to Main Street by the persons named above and the members of the
designated group. The nature of beneficial ownership for shares shown in
this column is sole voting and investment power, except as set forth in the
footnotes below. Pursuant to the rules of the Securities and Exchange
Commission, shares obtainable through the exercise of options which are
currently exercisable, or which will become exercisable within 60 days of
the date of the information contained in this table, are included as
beneficially owned. The number of shares obtainable through options and
included in this table are as follows: 18,240 shares for Messrs. Downey,
Meyer, Salmon, Shapland and Van Buskirk; 5,000 shares for Messrs. Haab,
Kenney, Sloan and Zacheis; 29,570 shares for Mr. Luttrell; 17,780 shares
for Mr. White; 2,457 shares for Mr. Brahier;
5
<PAGE>
and 137,239 shares for Messrs. Dukeman and Lykins. Each director and
officer has no voting and sole investment power over such shares. Inclusion
of shares shall not constitute an admission of beneficial ownership or
voting or investment power over such shares.
(2) Includes 171 shares owned by Mr. Downey's spouse over which Mr. Downey has
shared voting and sole investment power.
(3) Includes 2,100 shares owned by Mr. Dukeman's spouse over which Mr. Dukeman
has shared voting and sole investment power.
(4) Includes 2,457 shares owned by Mr. Haab's spouse over which Mr. Haab has
shared voting and sole investment power.
(5) Includes 26,494 shares owned by Mr. Kenney's spouse over which Mr. Kenney
has shared voting and sole investment power; 1,638 shares owned jointly
with Mr. Kenney's spouse over which Mr. Kenney has shared voting and sole
investment power; and 1,905 shares held by Mr. Kenney's minor children over
which Mr. Kenney has shared voting and sole investment power.
(6) Includes 6,552 shares owned by Mr. Luttrell's spouse over which Mr.
Luttrell has shared voting and sole investment power.
(7) Includes 3,819 shares owned by Mr. Lykins' spouse over which Mr. Lykins has
shared voting and sole investment power.
(8) Includes 1,373,659 shares held in certain trusts for which Mr. Meyer serves
as trustee. Mr. Meyer exercises sole voting and investment power over such
shares. Also includes 61,321 shares held by Mr. Meyer's spouse. Mr. Meyer
disclaims beneficial ownership over all such shares.
(9) Includes 2,745 shares owned by Mr. Wise's spouse over which he has shared
voting and sole investment power. Also includes 3,276 shares owned jointly
with Mr. Wise's spouse over which Mr. Wise has shared voting and sole
investment power.
(10) Includes 6,552 shares held in trust over which Mr. Zacheis has no voting
and no investment power. Also includes 982 shares held by Mr. Zacheis'
spouse over which Mr. Zacheis has shared voting and sole investment power.
(11) Includes 2,948 shares owned jointly with Mr. Brahier's spouse over which
Mr. Brahier has shared voting and sole investment power. Also includes
2,994 shares held in trust for which Mr. Brahier's spouse serves as
trustee.
AMENDED AND RESTATED SHAREHOLDERS' AGREEMENT
Certain principal shareholders of Main Street are party to an Amended and
Restated Shareholders' Agreement. These shareholders originally entered into the
Shareholders' Agreement as stockholders of BankIllinois Financial. This
Shareholder's Agreement remains in effect in regard to each party's holdings of
Main Street common stock. The agreement affects the purchase and sale of the
common stock of Main Street owned by the parties thereto. The parties to the
agreement are August C. Meyer, Jr. and certain related entities, David J.
Downey, George T. Shapland, Gregory B. Lykins and Van A. Dukeman.
The Shareholders' Agreement provides that the parties to the agreement may
not make voluntary transfers of their shares of Main Street stock except for
transfers to each other, family transfers, certain pledges and certain open
market sales. Parties to the Shareholders' Agreement are permitted to sell
shares on the open market, but only after the other parties have elected not to
exercise a right of first refusal to purchase the shares. In the event any party
to the agreement purchases shares from any third party, the purchasing
shareholder must allow the other parties the right to purchase a proportionate
amount of such shares. In addition, involuntary transfers occurring upon death
are permitted.
Each party to the Shareholders' Agreement other than August C. Meyer, Jr.
has the right to put his shares to Mr. Meyer, in which event Mr. Meyer will be
obligated to purchase all such shares subject to the rights of the other parties
to join in the purchase on a proportionate basis. If a put is exercised, and
within 18 months thereafter there is a sale of Main Street, any profits realized
on the sale of the put shares must be repaid to the party that previously
exercised the put. The Shareholders' Agreement will terminate in 2005, unless
otherwise terminated by the parties.
6
<PAGE>
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table shows the compensation earned during the three most
recently completed fiscal years by Main Street's chief executive officer and the
four other most highly compensated executive officers of BankIllinois Financial
and First Decatur on a combined basis (including those employed by their
respective subsidiaries) whose 1999 salary and bonus exceeded $100,000:
<TABLE>
<CAPTION>
=============================================================================================================================
SUMMARY COMPENSATION TABLE
- -----------------------------------------------------------------------------------------------------------------------------
LONG TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS
----------------------------------------------------------------
(a) (b) (c) (d) (e) (g) (i)
NAME AND SECURITIES ALL OTHER
PRINCIPAL POSITION YEAR SALARY($) BONUS($) OTHER($) UNDERLYING COMPENSATION
WITH MAIN STREET OPTIONS/ ($)
SARs(1)
=============================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
John W. Luttrell(2) 1997 $210,000 $ 30,000 -- -- $15,055
Chairman of the Board 1998 210,000 37,500 -- -- 11,155
1999 210,000 39,000 -- -- 11,207
- -----------------------------------------------------------------------------------------------------------------------------
Gregory B. Lykins(3) 1997 $180,000 $ 40,000 -- 3,472 $18,550
Vice Chairman of the Board 1998 134,307 50,000 $3,792 5,512 17,329
1999 102,962 100,000 -- 5,250 18,966
- -----------------------------------------------------------------------------------------------------------------------------
Van A. Dukeman(4) 1997 $127,000 $ 40,000 -- 3,472 $13,445
President and Chief 1998 151,346 60,000 $1,729 5,512 14,207
Executive Officer 1999 154,231 100,000 -- 5,250 16,825
- -----------------------------------------------------------------------------------------------------------------------------
Milton J. Brahier(5) 1997 $135,000 $ 20,000 -- -- $ 7,306
President of the First 1998 145,000 25,000 -- -- 7,763
National Bank of Decatur 1999 154,000 30,000 -- -- 7,317
- -----------------------------------------------------------------------------------------------------------------------------
David B. White(6) 1997 $ 95,000 $ 15,000 -- 3,472 $ 9,395
Executive Vice 1998 107,115 22,000 $1,625 3,307 10,639
President, Treasurer and Chief 1999 107,962 25,000 -- 3,150 12,012
Financial Officer
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
- ---------------
(1) As adjusted for stock dividends.
(2) Prior to the merger in March, 2000, Mr. Luttrell was the President and
Chief Executive Officer of First Decatur. All other compensation includes
First Decatur's contributions under its employee stock ownership plan and
amounts paid for premiums on insurance policies with respect to Mr.
Luttrell. These amounts were $10,901 and $4,154 for Mr. Luttrell in 1997,
$6,729 and $4,426 in 1998 and $6,597 and $4,610 in 1999.
(3) Prior to the merger in March, 2000, Mr. Lykins was Chairman of the Board of
BankIllinois Financial. All other compensation includes BankIllinois
Financial's contributions under its 401(K) Plan, Non-Qualified Retirement
Plan, Profit Sharing Plan and amounts paid for premiums on insurance
policies with respect to Mr. Lykins. These amounts were $3,200, $3,400,
$8,000 and $3,950 for Mr. Lykins for 1997, $1,590, $2,329, $8,800 and
$4,610 for 1998, and $800, $5,288, $8,800 and $4,078 for 1999.
(4) Prior to the merger in March, 2000, Mr. Dukeman was President and Chief
Executive Officer of BankIllinois Financial. All other compensation
includes BankIllinois Financial's contributions under its 401(K) Plan,
Non-Qualified Retirement Plan, Profit Sharing Plan
7
<PAGE>
and amounts paid for premiums on insurance policies with respect to Mr.
Dukeman. These amounts were $3,200, $1,810, $8,000 and $435 for Mr. Dukeman
for 1997, $1,787, $3,140, $8,800 and $480 for 1998, and $800, $6,826,
$8,800 and $399 for 1999.
(5) Mr.Brahier is President of the First National Bank of First Decatur. All
other compensation includes First Decatur's contributions under its
employee stock ownership plan and amounts paid for premiums on insurance
policies with respect to Mr. Brahier. These amounts were $6,495 and $627
for Mr. Brahier in 1997, $6,453 and $700 in 1998 and $6,597 and $720 in
1999.
(6) Prior to the merger in March, 2000, Mr. White was the Executive Vice
President and Chief Financial Officer of BankIllinois Financial. All other
compensation includes BankIllinois Financial's contributions under its
401(K) Plan, Non-Qualified Retirement Plan, Profit Sharing Plan and amounts
paid for premiums on insurance policies with respect to Mr. White. These
amounts were $2,200, $1,705, $5,200 and $290 for Mr. White for 1997,
$1,570, $2,072, $6,695 and $302 for 1998, and $665, $4,347, $6,685 and $315
for 1999.
STOCK OPTION INFORMATION
The following table sets forth certain information concerning the number
and value of stock options granted in the last fiscal year to the individuals
named in the Summary Compensation Table. The options granted and potential value
realized are not adjusted for the merger in March, 2000 and are as of December
31, 1999.
<TABLE>
<CAPTION>
===================================================================================================================================
OPTION GRANTS IN LAST FISCAL YEAR
- -----------------------------------------------------------------------------------------------------------------------------------
INDIVIDUAL GRANTS
- -----------------------------------------------------------------------------------------------------------------------------------
Potential realizable value
at assumed annual rates of
stock price appreciation
for option term
===================================================================================================================================
(a) (b) (c) (d) (e) (f) (g)
Options % of Total Options Exercise or Base Expiration
Name Granted Granted to Price ($/Sh)(2) Date 5%($) 10%($)
(#)(1)(2) Employees in
Fiscal Year(2)
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
John W. Luttrell -- -- -- -- -- --
- -----------------------------------------------------------------------------------------------------------------------------------
Gregory B. Lykins 5,250 10.0% $ 21.79 03/15/04 $ 31,605 $ 69,841
- -----------------------------------------------------------------------------------------------------------------------------------
Van A. Dukeman 5,250 10.0% 21.79 03/15/04 31,605 69,841
- -----------------------------------------------------------------------------------------------------------------------------------
Milton J. Brahier -- -- -- -- -- --
- -----------------------------------------------------------------------------------------------------------------------------------
David B. White 3,150 6.0% 21.79 03/15/04 18,964 41,904
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Such options vest over a three-year period. Options will vest in their
entirety upon the occurrence of a change in control. Percentages are
calculated based upon total number of employees at First Decatur for Mr.
Luttrell and BankIllinois Financial for Messrs. Lykins, Dukeman and White.
(2) As adjusted for stock dividends.
8
<PAGE>
The following table sets forth certain information concerning the
exercisable and nonexercisable stock options at December 31, 1999, held by the
individuals named in the Summary Compensation Table. The shares and values are
not adjusted for the merger in March, 2000.
<TABLE>
<CAPTION>
==================================================================================================================================
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FY-END
OPTION VALUES
- ----------------------------------------------------------------------------------------------------------------------------------
SHARES NUMBER OF SECURITIES
ACQUIRED UNDERLYING UNEXERCISED VALUE OF UNEXERCISED IN-THE-MONEY
ON VALUE OPTIONS AT FY-END OPTIONS
NAME EXERCISE REALIZED (#)(d) AT FY-END ($)(e)
(#)(a) (#)(b) ($)(c) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
John W. Luttrell --- --- 15,000 --- $ 226,200 $ ---
- ----------------------------------------------------------------------------------------------------------------------------------
Gregory B. Lykins --- --- 130,633 6,245 2,201,381 18,966
- ----------------------------------------------------------------------------------------------------------------------------------
Van A. Dukeman --- --- 130,633 6,245 2,201,381 18,966
- ----------------------------------------------------------------------------------------------------------------------------------
Milton J. Brahier --- --- 1,500 --- 22,620 ---
- ----------------------------------------------------------------------------------------------------------------------------------
David B. White 550 $ 9,640 17,106 3,823 237,148 12,152
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
EMPLOYMENT AGREEMENTS
Main Street has entered into employment agreements with certain of its
executive officers, including the executive officers named in the Summary
Compensation Table, and has agreed to an agreement in principle with John W.
Luttrell, which will be consistent with the other agreements. Each employment
agreement provides for an initial term of one year and, at the end of its
initial term as well as any subsequent term, is automatically extended for one
year until either Main Street or the employee gives written notice to the
contrary. Each agreement terminates upon the employee's death, disability,
discharge for cause or in the event of "constructive discharge" or a change of
control (as defined in the employment agreements). The employment agreements are
also terminable by the employee or Main Street upon 90 days' notice to the other
party.
The employment agreements set forth the salaries, bonuses and benefits to
be provided to the respective officer and provide for severance payments in the
event employment is terminated by Main Street without cause or in the event of a
"constructive discharge." The "severance payment" each officer would be entitled
to receive in such a case equals the sum of the applicable base salary, the
officer's most recent performance bonus and the value of contributions under
retirement and employee benefit plans that would have been made through the term
of the agreement.
In the event employment is terminated within one year of a change of
control, or at any time by Main Street or its successor for any reason other
than death or disability, the affected officer would be entitled to receive two
times the severance payment. The amounts payable upon a change of control are
subject to reduction, if necessary, to prevent certain adverse tax treatment.
The employment agreements also provide that the respective officer may not
compete within a 50-mile radius of either First National Bank of Decatur's or
BankIllinois' main office, depending on the executive officer's
9
<PAGE>
principal place of business, or against Main Street or any successor, for one
year following the termination of their employment agreement. Each employment
agreement also requires Main Street to indemnify and to advance certain legal
expenses to the covered employee to the maximum extent permitted by law.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Main Street's compensation committee will establish compensation and
benefits for the chief executive officer and will review and recommend
compensation and benefits for other officers and employees of the subsidiaries.
During 1999, no executive officer of BankIllinois Financial served as a member
of the compensation committee of another entity in which one of the executive
officers of such entity served on BankIllinois Financial's compensation
committee, the board of directors of another entity in which one of the
executive officers of such entity served on BankIllinois Financial's
compensation committee or the compensation committee of another entity in which
one of the executive officers of such entity served as a member of BankIllinois
Financial's board of directors. It is expected that this will remain the case
with Main Street's compensation committee.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
Main Street's compensation program is administered by the compensation
committee. The vice chairman and chief executive officer serve on this and all
committees ex-officio, but on none as chairman.
In determining appropriate levels of executive compensation, the committee
has at its disposal independent reference information regarding compensation
ranges and levels for executive positions in comparable companies. In
determining compensation to be paid to executive officers, primary consideration
is given to quality, long-term earnings growth accomplished by achieving both
financial and non-financial goals such as earnings per share, return on assets
and return on equity. The objectives of this philosophy are to:
- encourage consistent and competitive return to shareholders,
- reward Main Street and individual performances,
- provide financial rewards for performance by those having a
significant impact on corporate profitability, and
- provide competitive compensation in order to attract and retain key
personnel.
There are three basic components to the total compensation of all key
executives -- base salary, incentive bonus and long-term incentive compensation.
The salary component is reflective of levels of responsibility, authority and
performance, relative to similar positions in the banking industry. The
incentive portion is directly related to financial performance, as measured by
net income, return on average assets, and other financial factors. Main Street
maintains the stock incentive plan to reward senior executives of Main Street
for outstanding performance and to help Main Street attract and retain qualified
personnel in key positions. The stock option plan is further designed to give
key employees a proprietary interest in Main Street as an incentive to
contribute to the success of Main Street. Awards under the plan are determined
by the compensation committee based on each respective officer's level of
responsibility, overall performance and significance to Main Street's future
growth and profitability.
Roy V. Van Buskirk (Chair) August C. Meyer, Jr.
David J. Downey Van A. Dukeman (Ex-Officio)
Larry D. Haab Gregory B. Lykins, (Ex-Officio)
Frederic L. Kenney Phillip C. Wise (Ex-Officio)
10
<PAGE>
SHAREHOLDER RETURN PERFORMANCE PRESENTATION
The following graph shows a comparison of cumulative total returns for
BankIllinois Financial, the Nasdaq Stock Market and an index of Nasdaq bank
stocks with total assets of $500 million to $1 billion. Because the Securities
and Exchange Commission considers BankIllinois Financial as the continuing
entity for accounting purposes as a result of the merger with First Decatur into
Main Street, the following graph only presents the performance of BankIllinois
Financial's common stock.
The cumulative total shareholder return computations assume the investment
of $100 on January 25, 1996. Figures for BankIllinois Financial's common stock
represent inter-dealer quotations, without retail markups, mark downs or
commissions and do not necessarily represent actual transactions. The graph was
prepared at our request by SNL Securities L.C., Charlottesville, Virginia.
TOTAL RETURN PERFORMANCE
[EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHICS]
<TABLE>
<CAPTION>
PERIOD ENDING
----------------------------------------------------------
INDEX 01/25/96 12/31/96 12/31/97 12/31/98 12/31/99
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
BankIllinois Financial Corporation $100.00 $108.93 $135.71 $176.01 $190.56
NASDAQ - Total US* 100.00 125.20 153.39 216.30 400.94
SNL $500M-$1B Bank Index 100.00 122.93 199.82 196.47 181.87
</TABLE>
* SOURCE: CRSP, CENTER FOR RESEARCH IN SECURITY PRICES, GRADUATE SCHOOL OF
BUSINESS, THE UNIVERSITY OF CHICAGO 1999.
11
<PAGE>
PROPOSAL TO ADOPT STOCK INCENTIVE PLAN
On March 23, 2000, the board of directors adopted resolutions approving the
Main Street Trust, Inc. 2000 Stock Incentive Plan, subject to shareholder
approval, to promote equity ownership of Main Street by certain directors,
officers and employees of the Main Street and its subsidiaries, to increase
their proprietary interest in the success of Main Street, and to encourage them
to remain in the employ of Main Street. Reference is made to Exhibit A to this
proxy statement for the complete text of the Incentive Plan, which is summarized
below.
ADMINISTRATION
The incentive plan is to be administered by the board or a committee
appointed by the board, which if so appointed such committee shall be known as
the Stock Incentive Plan Administrative Committee. The board, or if applicable,
the stock incentive committee, will have the authority, to select the persons to
whom awards may be granted, to determine the terms of each award, to interpret
the provisions of the incentive plan and to make all other determinations that
it may deem necessary or advisable for the administration of the incentive plan.
The incentive plan provides for the grant of "incentive stock options," as
defined under Section 422(b) of the Internal Revenue Code of 1986, as amended,
options that do not so qualify (referred to herein as "nonstatutory options"),
restricted stock and stock appreciation rights, as determined in each individual
case by the stock incentive committee. The board of directors has reserved
2,000,0000 shares of common stock for issuance under the incentive plan. In
general, if any award (including an award granted to a non-employee director)
granted under the incentive plan expires, terminates, is forfeited or is
cancelled for any reason, the shares of common stock allocable to such award may
again be made subject to an award granted under the incentive plan.
AWARDS
Directors, officers and employees of Main Street and its subsidiaries are
eligible to receive grants under the incentive plan. Awards may be granted
subject to a vesting requirement and in any event will become fully vested upon
a merger or change of control of Main Street. The exercise price of incentive
stock options granted under the incentive plan must be at least equal to the
fair market value of the common stock subject to the option (determined as
provided in the incentive plan) on the date the option is granted. The exercise
price of nonstatutory options and stock appreciation rights will be determined
by the stock incentive committee.
An incentive stock option granted under the incentive plan to an employee
owning more than 10% of the total combined voting power of all classes of
capital stock of Main Street is subject to the further restriction that such
option must have an exercise price of at least 110% of the fair market value of
the shares of common stock issuable upon exercise of the option (determined as
of the date the option is granted) and may not have an exercise term of more
than five years. Incentive stock options are also subject to the further
restriction that the aggregate fair market value (determined as of the date of
grant) of common stock as to which any such incentive stock option first becomes
exercisable in any calendar year, is limited to $100,000. To the extent options
covering more than $100,000 worth of common stock first become exercisable in
any one calendar year, the excess will be nonstatutory options. For purposes of
determining which, if any, options have been granted in excess of the $100,000
limit, options will be considered to become exercisable in the order granted.
Each director, officer and employee eligible to participate in the
incentive plan will be notified by the stock incentive committee. To receive an
award under the incentive plan, an award agreement must be executed which
specifies the type of award to be granted, the number of shares of common stock
(if any) to which the award relates, the terms and conditions of the award and
the date granted. In the case of an award of options, the award agreement will
also specify the price at which the shares of common stock subject to the option
may be purchased, the date(s) on which the option becomes exercisable and
whether the option is an incentive stock option or a nonstatutory option.
12
<PAGE>
The full exercise price for all shares of common stock purchased upon the
exercise of options granted under the incentive plan must be paid by cash,
personal check, award surrender or common stock owned at the time of exercise.
Incentive stock options granted to employees under the incentive plan may remain
outstanding and exercisable for ten years from the date of grant or until the
expiration of ninety days (or such lesser period as the stock incentive
committee may determine) from the date on which the person to whom they were
granted ceases to be employed by Main Street. Nonstatutory options and stock
appreciation rights granted under the incentive plan remain outstanding and
exercisable for such period as the stock incentive committee may determine.
No awards have been made by the stock incentive committee pursuant to the
incentive plan at this time.
INCOME TAX
Incentive stock options granted under the incentive plan have certain
advantageous tax attributes to the recipient under the income tax laws. No
taxable income is recognized by the option holder for income tax purposes at the
time of the grant or exercise of an incentive stock option, although neither is
there any income tax deduction available to Main Street as a result of such a
grant or exercise. Any gain or loss recognized by an option holder on the later
disposition of shares of common stock acquired pursuant to the exercise of an
incentive stock option generally will be treated as capital gain or loss if such
disposition does not occur prior to the later of one year after the date of
exercise of the option, or two years after the date the option was granted.
As in the case of incentive stock options, the grant of nonstatutory stock
options, restricted stock or stock appreciation rights will not result in
taxable income for income tax purposes to the recipient of the awards, nor will
Main Street be entitled to an income tax deduction. Upon the exercise of
nonstatutory stock options or stock appreciation rights, or the lapse of
restrictions on restricted stock, the award holder will generally recognize
ordinary income for income tax purposes equal to the difference between the
exercise price and the fair market value of the shares of common stock acquired
or deemed acquired on the date of exercise, and Main Street will be entitled to
an income tax deduction in the amount of the ordinary income recognized by the
option holder. In general, any gain or loss realized by the option holder on the
subsequent disposition of such shares will be a capital gain or loss.
AMENDMENT AND TERMINATION
The incentive plan expires ten years after its adoption, unless sooner
terminated by the board of directors. The board of directors has authority to
amend the incentive plan in such manner as it deems advisable, except that the
board of directors is not permitted without shareholder approval to amend the
incentive plan in a manner which would materially increase the number of shares
with respect to which incentive stock options may be made under the incentive
plan or change the class of persons eligible to receive incentive stock option
awards under the incentive plan. The incentive plan provides for appropriate
adjustment, as determined by the stock incentive committee, in the number, kind
and price of shares subject to unexercised options and other awards, in the
event of any change in the outstanding shares of common stock by reason of a
stock split, stock dividend, combination or reclassification of shares,
recapitalization, merger or similar event.
REQUIRED AFFIRMATIVE VOTE
The affirmative vote of the holders of a majority of the shares of common
stock present in person or by proxy at the annual meeting is required to approve
the incentive plan.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR THE PROPOSED STOCK
INCENTIVE PLAN.
13
<PAGE>
GENERAL
Your proxy is solicited by the board of directors and the cost of
solicitation will be paid by Main Street. In addition to the solicitation of
proxies by use of the mails, officers, directors and regular employees of Main
Street or its subsidiary banks, acting on Main Street's behalf, may solicit
proxies by telephone, telegraph or personal interview. Main Street will, at its
expense, upon the receipt of a request from brokers and other custodians,
nominees and fiduciaries, forward proxy soliciting material to the beneficial
owners of shares held of record.
OTHER BUSINESS
It is not anticipated that any action will be asked of the shareholders
other than that set forth above, but if other matters properly are brought
before the meeting, the persons named in the proxy will vote in accordance with
their best judgment.
FAILURE TO INDICATE CHOICE
If any shareholder fails to indicate a choice in items (1) or (2) on the
proxy card, the shares of such shareholders shall be voted (FOR) in each
instance.
By order of the Board of Directors
/s/ Van A. Dukeman
Van A. Dukeman
President and Chief Executive Officer
Champaign, Illinois
May 15, 2000
ALL SHAREHOLDERS ARE URGED TO SIGN
AND MAIL THEIR PROXIES PROMPTLY
14
<PAGE>
MAIN STREET TRUST, INC.
PROXY FOR COMMON SHARES ON BEHALF OF THE BOARD OF DIRECTORS FOR
THE ANNUAL MEETING OF THE SHAREHOLDERS TO BE HELD JUNE 20, 2000
The undersigned hereby appoints Gregory B. Lykins and Van A. Dukeman, or
either of them acting in the absence of the other, with power of substitution,
attorneys and proxies, for and in the name and place of the undersigned, to vote
the number of shares of common stock that the undersigned would be entitled to
vote if then personally present at the Annual Meeting of the Shareholders of
Main Street Trust, Inc., to be held at The Forum at Carle, 611 West Park Street,
in Urbana, Illinois on Tuesday, June 20, 2000, at 7:00 p.m., local time, or any
adjournments or postponements of the meeting, upon the matters set forth in the
notice of annual meeting and proxy statement, receipt of which is hereby
acknowledged, as follows:
1. ELECTION OF DIRECTORS:
FOR all nominees listed below WITHHOLD AUTHORITY
(except as marked to the contrary to vote for all nominees
below) listed below
/ / / /
(INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE,
STRIKE A LINE THROUGH THE NOMINEE'S NAME IN THE LIST BELOW.)
CLASS I (TERM EXPIRES 2003): Frederic L. Kenney, Gregory B. Lykins, August C.
Meyer, Jr. and Phillip C. Wise
2. To approve and ratify the Main Street Trust, Inc. 2000 Stock Incentive
Plan.
/ / / / / /
For Against Abstain
3. In accordance with their discretion, upon all other matters that may
properly come before said meeting and any adjournments or postponements
thereof.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY
THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED
FOR THE NOMINEES LISTED UNDER PROPOSAL 1 AND FOR PROPOSAL 2.
Dated: , 2000
-----------------------------
Signature(s)
-----------------------------
-----------------------------------------
NOTE: PLEASE DATE PROXY AND SIGN IT EXACTLY AS NAME OR NAMES APPEAR ABOVE. ALL
JOINT OWNERS OF SHARES SHOULD SIGN. STATE FULL TITLE WHEN SIGNING AS EXECUTOR,
ADMINISTRATOR, TRUSTEE, GUARDIAN, ETC. PLEASE RETURN SIGNED PROXY IN THE
ENCLOSED ENVELOPE.
