SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [X]
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 240.14a-11(c) or 240.14a-12
First Busey Corporation
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(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)(4) and
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pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee
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<PAGE>
FIRST BUSEY CORPORATION
201 W. MAIN, URBANA, IL 61801
217/365-4556
March 20, 2000
Dear Stockholder:
The Annual Meeting of Stockholders of First Busey Corporation will be held
on Tuesday, April 25, 2000 at THE FORUM AT CARLE, 611 West Park Street, Urbana,
Illinois. The Annual Meeting will begin at 7:00 p.m. At this Annual Meeting
you will be asked:
1. To elect 14 directors of the Company to serve until the next Annual
Meeting of Stockholders.
2. To ratify the appointment of McGladrey & Pullen, LLP as the
Company's independent auditors for the fiscal year ending December 31, 2000.
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" 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 of the Board
<PAGE>
FIRST BUSEY CORPORATION
201 W. MAIN, URBANA, IL 61801
217/365-4556
NOTICE OF 2000 ANNUAL MEETING OF STOCKHOLDERS
To Be Held April 25, 2000
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 FORUM AT CARLE, 611
W. Park Street, Urbana, Illinois, on Tuesday, April 25, 2000 at 7:00 p.m. for
the following purposes:
1. To elect 14 directors of the Company to serve until the next Annual
Meeting of Stockholders or until their successors are duly elected and
qualified.
2. To ratify the appointment of McGladrey & Pullen, LLP as the
Company's independent auditors for the fiscal year ending December 31, 2000.
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 March 3, 2000 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 of the Board of Directors,
Barbara J. Kuhl
Executive Vice President,
Corporate Secretary and Treasurer
Urbana, Illinois
March 20, 2000
- 2 -
<PAGE>
FIRST BUSEY CORPORATION
201 W. MAIN, URBANA, IL 61801
217/365-4556
PROXY STATEMENT
GENERAL
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of First Busey Corporation, also called the
Company or First Busey, for use at the Annual Meeting of Stockholders to be held
at THE FORUM AT CARLE, 611 W. Park Street, Urbana, Illinois, on Tuesday,
April 25, 2000, at 7:00 p.m., or any postponement or adjournment thereof. The
Board has fixed the close of business on March 3, 2000, 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
13,486,344 shares of Common Stock, without par value.
The Company's Form 10-K Annual Report, which includes audited financial
statements for the year ended December 31, 1999, accompanies this Proxy
Statement. The approximate date on which the Proxy Statement and the
accompanying proxy are first being sent to stockholders is March 20, 2000.
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
instructions thereon. If there are no such instructions, the shares will be
voted "FOR" (i) the election of the nominees for directors named in this Proxy
Statement and (ii) the ratification of the appointment of McGladrey & Pullen,
LLP as the Company's independent auditors for the fiscal year ending December
31, 2000. Properly executed proxies received by the Company will also be voted
at the Annual Meeting in accordance with the Board'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 14
nominees receiving the largest number of affirmative votes will be elected,
shares represented by proxies which are marked "withhold authority" or "abstain"
will have no effect on the outcome of the election. The Ratification of Auditors
Proposal requires the affirmative vote of at least a majority of the votes cast
at the Annual Meeting. Shares represented by proxies which are marked
"abstain" as to such matter will be counted as votes cast, which will have the
same effect as a negative vote on such matter.
Proxies relating to "street name" shares which are not voted by brokers on
one matter will be treated as shares present for purposes of determining the
presence of a quorum but will not be treated as votes cast as to such matter not
voted upon.
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" the Proposals. As of March 3, 2000, these
individuals beneficially owned an aggregate of 4,426,104 shares of Common Stock,
or approximately 32.72% of the Common Stock outstanding.
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.
- 3 -
<PAGE>
SOLICITATION
The cost of solicitation of proxies will be paid by the Company. 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.
ELECTION OF DIRECTORS
(PROPOSAL ONE)
The 14 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. All nominees are current members of the Company's Board.
It is intended that the proxies received in response to this solicitation
will be voted for the election of the 14 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 March 3, 2000, the
record date for the Annual Meeting. Unless otherwise noted, each nominee for
director has been employed in their principal occupation with the same
organization for at least the last 5 years.
JOSEPH M. AMBROSE
Director since: 1993
Age: 42
Mr. Ambrose has served as Executive Vice President of Anderson Financial
Network, Inc. since January 1999. Prior to that, Mr. Ambrose was a lawyer with
the firm Hinshaw & Culbertson, Bloomington, Illinois. Mr. Ambrose had been
associated with this firm since September of 1994. Mr. Ambrose previously served
as a director of Busey Bank of McLean County from 1984 to 1996.
SAMUEL P. BANKS
Director since: 1996
Age: 45
Mr. Banks is Executive Director of Cunningham Children's Home, Urbana, Illinois.
Mr. Banks has been associated with Cunningham Children's Home since 1982. Mr.
Banks has served on the Board of Directors of Busey Bank since 1994.
T. O. DAWSON
Director since: 1995
Age: 59
Mr. Dawson is a Managing Director of IRM Ltd./Acordia, Champaign, Illinois, a
firm recently established through the acquisition of Insurance Risk Managers by
Acordia, Inc. Prior to that, Mr. Dawson was a partner in the firm of Insurance
Risk Managers, Ltd., Champaign, Illinois. Mr. Dawson has served on the Board of
Directors of Busey Bank since 1988.
- 4 -
<PAGE>
VICTOR F. FELDMAN
Director since: 1996
Age: 64
Dr. Feldman is an Ophthalmologist at Christie Clinic, Champaign, Illinois. Dr.
Feldman has been associated with Christie Clinic since 1967. Dr. Feldman has
served on the Board of Directors of Busey Bank since 1985.
KENNETH M. HENDREN
Director since: 1996
Age: 53
Mr. Hendren is a self-employed farmer in LeRoy, Illinois. Mr. Hendren
previously served on the Board of Directors of Busey Bank of McLean County from
1994 to 1996.
E. PHILLIPS KNOX
Director since: 1980
Age: 53
Mr. Knox is a lawyer with the firm Tummelson Bryan & Knox, Urbana, Illinois.
Mr. Knox has served on the Board of Directors of Busey Bank since 1972.
P. DAVID KUHL
Director since: 1996
Age: 50
Mr. Kuhl is President and Chief Executive Officer of Busey Bank, a position he
assumed in June of 1991. Prior to that, Mr. Kuhl served in various management
capacities since joining Busey Bank in 1979. Mr. Kuhl has served on the Board
of Directors of Busey Bank since 1991.
V. B. LEISTER, JR.
Director since: 1996
Age: 54
Mr. Leister is President of Carter's Moving & Storage, Inc., and Vice President
& Treasurer of Carter's Furniture Inc., Urbana, Illinois. Mr. Leister has served
on the Board of Directors of Busey Bank since 1992.
DOUGLAS C. MILLS
Director since: 1980
Age: 59
Mr. Mills has served as Chairman of the Board and Chief Executive Officer of
First Busey Corporation since its incorporation and, effective December 21,
1993, he assumed the role of President. He has been associated with Busey Bank
since 1971 when he assumed the position of Chairman of the Board.
LINDA M. MILLS
Director since: 1996
Age: 59
Mrs. Mills is Chairman of the Board of Busey Travel, Champaign, Illinois. Mrs.
Mills has served on the Board of Directors of Busey Bank since 1991.
ROBERT C. PARKER
Director since: 1996
Age: 47
Dr. Parker is a Physician at Carle Clinic Association, Urbana. Dr. Parker has
been associated with Carle Clinic Association since 1982. Dr. Parker has served
on the Board of Directors of Busey Bank since 1995.
- 5 -
<PAGE>
DAVID C. THIES
Director since: 1996
Age: 44
Mr. Thies is an attorney with the law firm of Webber & Thies, P.C., Urbana,
Illinois. Mr. Thies has served on the Board of Directors of Busey Bank since
1986.
EDWIN A. SCHARLAU II
Director since: 1984
Age: 55
Mr. Scharlau is Chairman of the Board of First Busey Trust & Investment Co. and
First Busey Securities, Inc., positions he assumed in June of 1994. Mr.
Scharlau also serves as Chairman of the Board of Busey Bank, a position he has
held since July of 1991. Mr. Scharlau has been associated with Busey Bank since
1964.
ARTHUR R. WYATT
Director since: 1995
Age: 72
Mr. Wyatt is currently a Professor of Accounting at the University of Illinois.
Prior to that, he was a Partner at Arthur Andersen, LLP, Chicago, Illinois from
1966 to 1992. He also served as a member of the Financial Accounting Standards
Board from 1985 to 1987.
During 1999, the Board of Directors of First Busey held 12 meetings.
All directors attended at least 75% of the meetings of the Board and the
committees on which they served during 1999.
The Board of Directors of First Busey has established the following
committees, among others, to assist in the discharge of its responsibilities.
The Audit Committee met four times in 1999. Members of the 1999 Audit
Committee were Mr. Ambrose (chairman), Mr. Hendren, Mr. Thies, and Mr. Wyatt.
The principal functions of the Audit Committee are to review periodic internal
reports, arrange for the annual external audit of First Busey, and to make a
written report of such examination to the full Board of Directors.
The Compensation Committee met three times in 1999. Members of the 1999
Compensation Committee were Mr. Wyatt (Chairman), Mr. Knox and Dr. Feldman.
First Busey does not have a formal nominating committee. The Board of
Directors, as a whole, performs the function of nominating persons for the
Board.
During 1999, non-employee directors of First Busey received $600 for each
meeting held. Directors who are also employees of First Busey or any of its
subsidiaries receive no additional compensation for attending Board of
Directors' meetings. Certain Directors have elected to defer their directors'
fees pursuant to First Busey's Director Deferred Compensation Plan.
As an alternative to a cash payment, non-employee directors may elect to
receive options to purchase 3,000 shares of Common Stock pursuant to the First
Busey Corporation 1999 Stock Option Plan. Said options were granted on January
19, 1999 at a price of $18.25 per share, the closing price of the Common Stock
on such date. These options became exercisable on January 19, 2000 and expire
on December 15, 2003. Directors Ambrose, Banks, Dawson, Hendren, Knox, Leister,
Mills, Parker and Wyatt chose to receive stock options. During 1999,
non-employee directors could continue to defer their directors' fees pursuant to
the Director Deferred Compensation Plan. During 1999, Dr. Feldman deferred his
fees. This plan was terminated effective December 31, 1999. The accounts
containing such deferred amounts of Dr. Feldman, Mr. Leister, Mrs. Mills and Mr.
Wyatt were credited with interest at the rate of 4.541%, which was the yield on
the 5 year U. S. Treasury note as of December 31, 1998.
- 6 -
<PAGE>
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 March 3, 2000 by all directors and director
nominees, by each person who is known by First Busey 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 Securities
and Exchange 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 March 3, 2000 through the exercise of any
stock 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.
(Table on following page.)
- 7 -
<PAGE>
<TABLE>
<CAPTION>
Name and Address of Beneficial Owner Common Stock Beneficially Owned
- ---------------------------------------------- -------------------------------
Percent of
Shares Total Outstanding
--------- ------------------
<S> <C> <C>
Douglas C. Mills (1) (2) 2,614,194 19.36%
201 E. Main Street
Urbana, Illinois 61801
First Busey Trust & Investment Co. (3) 1,434,243 10.64%
102 E. Main Street
Urbana, Illinois 61801
Linda M. Mills (4) 715,200 5.30%
2123 Seaton Court
Champaign, Illinois 61821
A. Barclay Klingel, Jr. (5) 833,002 6.18%
Joseph M. Ambrose 28,510 .21%
Samuel P. Banks 5,234 .04%
T. O. Dawson 88,626 .66%
Victor F. Feldman 72,544 .54%
Kenneth M. Hendren 144,238 1.07%
E. Phillips Knox 203,900 1.51%
P. David Kuhl (6) (7) 58,749 .44%
Barbara J. Kuhl (8) 70,963 .53%
V. B. Leister, Jr. 21,248 .16%
Robert C. Parker 5,900 .04%
Edwin A. Scharlau II (9) 333,446 2.47%
David C. Thies 2,700 .02%
Arthur R. Wyatt 60,652 .45%
All directors and executive officers as a group 4,426,104 32.72%
(15 persons)
<FN>
(1) The number of shares listed does not include 715,200 shares of Common
Stock beneficially owned by Linda M. Mills, Mr. Mills' spouse. The number
of shares does include 670,002 held by the Martin A. Klingel Estate for
which Mr. Mills shares voting and dispositive powers with A. Barclay
Klingel, Jr. and 1,000,000 shares held by the Mills Investment LP for which
Mr. Mills has sole voting rights.
(2) The number of shares listed includes options to purchase 20,000 shares
of Common Stock which are currently exercisable.
(3) Bubank Co. and Urban & Co., each of which is a partnership (the
registered nominees for First Busey Trust & Investment Co.), hold these
shares in various fiduciary capacities. Of these shares, 494,969 are
beneficially owned by First Busey Corporation Profit Sharing Plan & Trust
and 939,274 are beneficially owned by First Busey Employee Stock Ownership
Plan. There are also 819,274 shares registered under these nominees for
which First Busey Trust & Investment Co. does not have sole voting or
investment power.
(4) The number of shares listed does not include 1,944,036 shares of
Common Stock beneficially owned by Douglas C. Mills, Mrs. Mills' spouse.
(5) Douglas C. Mills and A. Barclay Klingel, Jr. are co-executors of the
Martin A. Klingel Estate which holds 670,002 shares and they share voting
and dispositive power of these shares. Mr. Klingel also holds sole voting
rights to 108,000 shares as trustee for the Klingel Insurance Trust.
(6) The number of shares listed does not include 70,963 shares of common
stock beneficially owned by Barbara J. Kuhl, Mr. Kuhl's spouse.
(7) The number of shares listed includes options to purchase 10,000 shares
of Common Stock which are currently exercisable.
(8) The number of shares listed does not include 58,749 shares of common
stock beneficially owned by P. David Kuhl, Mrs. Kuhl's spouse.
(9) The number of shares listed includes options to purchase 10, 000
shares of Common Stock which are currently exercisable.
</TABLE>
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<PAGE>
Section 16(a) Beneficial Ownership Compliance. Section 16(a) of the
Securities Exchange Act of 1934, as amended, requires the Company's directors,
executive officers and holders of more than 10% of the Common Stock to file with
the Securities and Exchange 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,
1999, its executive officers, directors and holders of more than 10% of the
Common Stock complied with all Section 16(a) filing requirements except for
Directors Kuhl and Scharlau who were delinquent in the filing of one Form 4 each
during 1999. In making these statements, the Company has relied upon the written
representations of its directors and executive officers.
COMPENSATION OF EXECUTIVE OFFICERS
The following table discloses compensation received by the Company's Chief
Executive Officer and the other executive officers of the Company for the three
fiscal years ending December 31, 1999.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
ANNUAL COMPENSATION LONG TERM COMPENSATION AWARDS
--------------------- -----------------------------------
Securities
Name and Restricted Stock Underlying All Other
Principal Position Year Salary ($) Bonus ($) Awards ($)(1) Options/SARS (#) Compensation ($)(2)
- ------------------------- ---- ---------- --------- ----------------- ---------------- -------------------
<S> <C> <C> <C> <C> <C> <C>
Douglas C. Mills 1999 125,000 100,000 2,263 20,000 67,713
Chairman of the Board and 1998 155,000 48,050 3,650 4,642 99,999
Chief Executive Officer 1997 155,000 100,000 5,500 66,000 77,330
Edwin A. Scharlau II 1999 150,000 50,000 2,263 10,000 13,791
Chairman of the Board of 1998 155,000 37,200 3,650 4,700 27,477
First Busey Trust & 1997 155,000 44,950 5,500 10,000 20,144
Investment Co.
P. David Kuhl 1999 150,000 50,000 2,263 10,000 12,988
President and Chief 1998 153,000 36,720 3,650 4,700 20,730
Executive Officer of 1997 147,000 42,630 5,500 10,000 16,113
Busey
Barbara J. Kuhl 1999 75,000 45,000 2,263 -0- 9,895
Executive Vice President 1998 65,500 24,000 3,650 4,400 -
1997 65,500 25,000 5,500 4,000 -
<FN>
(1) At December 31, 1999, Mr. Mills, Mr. Scharlau, Mr. Kuhl and Mrs. Kuhl each held 100 shares of
restricted stock having a value of $2,262.50 based upon a $22.625 share closing price of Common Stock as quoted
on the Nasdaq National Market on December 31, 1999. The shares of restricted stock awarded to the executive
officers are subject to the restriction that the Company must achieve a specified net income per share for the
year ended December 31, 2000. Should the Company achieve this specified net income per share, the restriction
will lapse and the shares will be awarded to the executive officers. Dividends are paid on all shares of
restricted stock to the same extent as any other shares of the Common Stock. The restrictions for 1999 lapsed
and 100 shares were released on January 18, 2000.
(2) The amounts disclosed in this column for 1999 include:
(a) Company contributions of $9,482.89, $10,065.19, $9,462.91 and $7,550.28, under First Busey Corporation
Profit Sharing Plan & Trust, a defined contribution plan, on behalf of Mr. Mills, Mr. Scharlau, Mr. Kuhl and
Mrs. Kuhl respectively.
(b) Discretionary company contributions of $2,945.35, $3,126.21, $2,939.13 and $2,345.48, under First Busey
Corporation Employee Stock Ownership Plan, a defined contribution plan, on behalf of Mr. Mills, Mr. Scharlau,
Mr. Kuhl and Mrs. Kuhl, respectively.
(c) Compensation value of a split-dollar life insurance policy on Mr. Mills in the amount of $55,285. The
Company will be reimbursed for all premiums paid on the policy, without interest, from the proceeds of the
policy. Split-dollar life insurance policies were acquired on Mr. Scharlau and Mr. Kuhl during 1994. For 1999,
$600 and $586, respectively, represent the compensation value of these policies to Mr. Scharlau and Mr. Kuhl.
</TABLE>
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<PAGE>
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
Potential Realizable Value at
Assumed Annual Rates
of Stock Price Appreciation
Individual Grants for Option Term
------------------------------------------- ------------------------------
Number of % of
Securities Total Options
Underlying Granted to Exercise or
Options/SARs Employees in Base Price Expiration
Name Granted (#)(1) Fiscal Year ($/Share) Date 5%($) 10%($)
- -------------------- -------------- ------------- ------------ ---------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Douglas C. Mills 20,000 29.9 18.25 12/15/03 185,017 297,505
Edwin A. Scharlau II 10,000 14.9 18.25 12/15/03 92,508 148,753
P. David Kuhl 10,000 14.9 18.25 12/15/03 92,508 148,753
<FN>
(1) The options became fully exercisable on January 19, 2000. No portion is exercisable before
that date.
</TABLE>
AGGREGATED OPTIONS/SAR EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END
OPTIONS/SAR VALUES
The following table provides information on option exercises in fiscal 1999
by the named executive officers and the value of such officers' unexercised
options at December 31, 1999.
<TABLE>
<CAPTION>
Number of Securities
Underlying Unexercised Value of Unexercised In-the-
Options/SARs at Money Options/SARs at
December 31, 1999(#) December 31, 1999 ($) (1)
------------------------------------------------------------
Shares
Acquired on Value
Name Exercise (#) Realized ($) Exercisable Unexercisable Exercisable Unexercisable
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Douglas C. Mills 0 0 0 120,642 0 1,142,692
Edwin A. Scharlau II 41,000 722,753 0 47,200 0 488,500
P. David Kuhl 16,500 305,003 0 47,200 0 488,500
Barbara J. Kuhl 6,000 105,949 0 17,400 0 192,705
<FN>
(1) Based on the closing price of Common Stock as quoted on the Nasdaq National
Market on December 31, 1999 ($22.625). The numbers shown reflect the value of
options accumulated over a five-year period.
</TABLE>
REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors administers the
Company's executive compensation program. After consideration of the
Committee'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 three main components to the executive
officers' compensation package: salary, bonus and stock awards. It is 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 believes that stock ownership by its executive officers assists in aligning
the executive officers' interests with those of the Company's stockholders. In
January of 1999, the Compensation Committee recommended and the Board of
- 10 -
<PAGE>
Directors approve the Management and Associate Dividend Program, or the "MAD
program." Under the MAD program, the Board of Directors set four targeted
levels for "diluted earnings per share" for the Company for 1999. These levels
were, $.87, $.88, $.89 and $.90. Based on the level of achievement of earnings
per share, the officer or associate would receive a dividend of a predetermined
percentage of their salary. The goal of the MAD program is to heighten
awareness of the Company's earnings per share goal while emphasizing the impact
of the team concept throughout the organization. The term "dividend" was used to
indicate that this award was granted at the discretion of the Board of Directors
and would be based annually on the achievement of earnings per share, similar to
the dividend paid to the Company's stockholders. Under this program, the Board
hopes to further enhance the alignment of the staff's efforts with those of the
Company's stockholders.
In September of 1996, the Board of Directors approved the award of 400
shares of Restricted Stock to each of 41 officers, all of whom were then at the
Senior Vice President level or above. Restricted stock grantees are
collectively referred to as the "Officers." These shares carry restrictions
which are tied to the earnings per share targets for the years 1997, 1998, 1999
and 2000. Should the Company achieve the specified earnings per share target,
the restriction on 100 shares annually will lapse and the shares will be
allocated to the Officers. Based on the achievement of the 1999 earnings per
share target of $.90, 100 shares were allocated to the Officers in January of
2000.
COMPENSATION OF THE CHIEF EXECUTIVE OFFICER
Base Salary/ MAD Program. Mr. Mills' 1999 base salary was set at $125,000,
representing a decrease from his base salary of $155,000 for 1998. The
Committee determined that under the MAD program, if the level of earnings per
share set by the Board was achieved, $.87, $.88, $.89 or $.90, Mr. Mills'
dividend would be 50%, 60%, 70%, or 80%, respectively, of his salary. The
minimum earnings per share target would have awarded Mr. Mills a dividend of
$62,500 with the highest level awarding Mr. Mills a dividend of $100,000. Based
on the Company's achievement of earnings per share of $.90, Mr. Mills received a
dividend in the amount of $100,000.
Restricted Stock. During 1996, Mr. Mills was awarded 400 shares of
restricted stock tied to the performance of the Company as of December 31, 1997,
1998, 1999 and 2000. Because the earnings per share target for 1999 was
achieved, 100 shares of restricted stock were released.
Stock Options. The granting of stock options by the Committee is designed
to retain and motivate the management team as well as align executive officers'
financial interests with stockholder value. The number of 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. In January of 1999, stock options
representing 67,000 shares were granted to officers and Directors of the
Company. Mr. Mills received a stock option for 20,000 shares.
COMPENSATION COMMITTEE
Arthur R. Wyatt (Chairman)
Victor F. Feldman
E. Phillips Knox
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<PAGE>
Notwithstanding anything to the contrary set forth in any of the Company's
previous filings under the Securities Act 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
The following table compares the Company's performance, as measured by the
change in price of Common Stock plus reinvested dividends, with the CRSP Nasdaq
Total Return Index- United States and the SNL-Midwestern Banks Index for the
five years ended December 31, 1999.
<TABLE>
<CAPTION>
FIRST BUSEY CORPORATION
Stock Price Performance
Period Ending
----------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Index 12/31/94 12/31/95 12/31/96 12/31/97 12/31/98 12/31/99
- -----------------------------------------------------------------------------------
First Busey Corporation 100.00 115.23 147.16 187.15 254.35 322.22
NASDAQ - Total US 100.00 141.33 173.89 213.07 300.25 542.43
SNL Midwest Bank Index 100.00 147.77 201.03 325.95 346.70 272.40
</TABLE>
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.
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<PAGE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
None.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Busey Bank has had, and may be expected to have in the future, banking
transactions in the ordinary course of business with directors, executive
officers and holders of 5% or more of First Busey'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, 1999, these persons and companies were indebted to Busey Bank for loans
totaling approximately $5,257 million representing 6.39% of total stockholders'
equity. In addition to these loans, Busey Bank makes loans to officers of First
Busey's subsidiaries who are not executive officers of First Busey.
Mr. Knox, a director of the Company, is a lawyer with Tummelson Bryan &
Knox, Urbana, Illinois and provided legal and certain consulting services to the
Company during fiscal 1999. The dollar amount of the fees paid to Tummelson
Bryan & Knox by the Company during the 1999 fiscal year was $92,912.
RATIFICATION OF AUDITORS PROPOSAL
(PROPOSAL TWO)
The Board of Directors has appointed McGladrey & Pullen, LLP as independent
auditors for the fiscal year ending December 31, 2000. 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.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE FOR THE RATIFICATION OF
AUDITORS PROPOSAL.
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's Board of Directors' recommendation on such
matters.
STOCKHOLDER PROPOSALS
If a stockholder intends to present a proposal at the Company's 2001 Annual
Meeting of Stockholders and desires that the proposal be included in the
Company'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's principal executive offices not later than November 20, 2000. As to
any proposal that a stockholder intends to present to stockholders without
inclusion in the Company's Proxy Statement for the Company's 2001 Annual Meeting
of
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<PAGE>
Stockholders, the proxies named in management'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 proposed not later than February 2,
2001. Even if proper notice is received on or prior to February 2, 2001, the
proxies named in management'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
Executive Vice President,
Corporate Secretary and Treasurer
March 20, 2000
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