PROSPECTUS
FIRST MIDWEST BANCORP, INC.
DIVIDEND REINVESTMENT AND
STOCK PURCHASE PLAN
Purchase First Midwest Bancorp, Inc.
Common Stock without incurring any
brokerage commissions or service charges
through reinvestment of dividends
or by making optional purchases.
Dated December 15, 1995
PROSPECTUS
FIRST MIDWEST BANCORP, INC.
DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN
500,000 SHARES
COMMON STOCK (NO PAR VALUE)
The Dividend Reinvestment and Stock Purchase Plan (the "Plan") of First
Midwest Bancorp, Inc. (the "Corporation") provides each holder of shares of
the Corporation's no par value Common Stock, ("Common Stock") with a simple
and convenient method of reinvesting cash dividends and making optional
purchases, at the current market price, for additional shares of Common Stock,
without incurring any brokerage commissions, service charges or similar costs.
Any holder of record of shares of Common Stock is eligible to participate in
the Plan. Shares purchased under the Plan will be purchased directly from the
Corporation or on the open market as the Corporation shall determine.
A stockholder may participate in the Plan and obtain additional shares of
Common Stock by: (1) reinvesting dividends on all shares of Common Stock held
by the stockholder; or (2) reinvesting dividends on only a portion of the
shares of Common Stock held by the stockholder while continuing to receive
cash dividends on the remaining shares; or (3) making optional purchases of
not less than $100 nor more than $5,000 per quarter, whether or not the
stockholder's dividends are being reinvested.
This Prospectus relates to 500,000 authorized and unissued shares of the
Corporation's Common Stock registered for purchase under the Plan, of which
404,723 shares remain available for purchase as of the date of this
Prospectus. It is suggested that this Prospectus be retained for future
reference.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is December 15, 1995
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS, IN CONNECTION WITH THE OFFER
CONTAINED IN THIS PROSPECTUS, AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
CORPORATION. THIS PROSPECTUS IS NOT AN OFFER TO SELL, OR A SOLICITATION OF AN
OFFER TO BUY, IN ANY STATE IN WHICH IT IS UNLAWFUL TO MAKE SUCH AN OFFER OR
SOLICITATION. EXCEPT WHERE OTHERWISE INDICATED HEREIN, THIS PROSPECTUS SPEAKS
AS OF ITS DATE AND NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE
HEREUNDER SHALL UNDER ANY CIRCUMSTANCES CREATE AN IMPLICATION THAT THERE HAS
BEEN NO CHANGE IN THE AFFAIRS OF THE CORPORATION SINCE THE DATE HEREOF.
AVAILABLE INFORMATION
The Corporation is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission") (File Number 0-10967).
Such reports, proxy statements and other information can be inspected and
copied at the public reference facilities of the Commission, at 450 Fifth
Street, N.W., Washington, D.C. 20549 and at the Regional Offices of the
Commission at the following locations: Seven World Trade Center, Suite 1300,
New York, New York, 10048 and 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661. Copies of such material can be obtained from the Public
Reference Section of the Commission at 450 Fifth Street, N.W., Washington,
D.C. 20549, at prescribed rates.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents which have heretofore been filed by the Corporation
with the Commission are incorporated by reference in this Prospectus:
1. The Corporation's Annual Report on Form 10-K for the fiscal year ended
December 31, 1994.
2. The Corporation's Quarterly Reports on Form 10-Q for the quarters ended
March 31, 1995, June 30, 1995 and September 30, 1995.
3. The Corporation's Reports on Form 8-K filed on the following dates:
February 1, 1995, June 1, 1995, November 21, 1995 and December 1, 1995.
4. The description of the Corporation's Common Stock, no par value, and
stock purchase rights associated with the Corporation's Common Stock, as
contained in the Corporation's Registration Statement on Form 8-A, dated
February 17, 1989, as amended by subsequently filed reports on Form 10-
K.
All documents filed by the Corporation with the Commission pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this
Prospectus and prior to the termination of the offering of Common Stock
offered hereby shall be deemed to be incorporated by reference in this
Prospectus and to be made a part hereof. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein shall
be deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein (or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein)
modifies or supersedes such statement. Any statement so modified or
superseded shall not be deemed to constitute a part of this Prospectus, except
as so modified or superseded.
UPON ORAL OR WRITTEN REQUEST, THE CORPORATION WILL FURNISH WITHOUT CHARGE TO
EACH PERSON TO WHOM THIS PROSPECTUS IS DELIVERED, A COPY OF ANY AND ALL OF THE
DOCUMENTS DESCRIBE ABOVE, OTHER THAN EXHIBITS HERETO NOT INCORPORATED BY
REFERENCE INTO SUCH DOCUMENTS. SUCH REQUESTS SHOULD BE ADDRESSED TO THE AGENT
AT THE ADDRESS AND TELEPHONE NUMBER INDICATED ON PAGE 1.
CONTENTS
THE CORPORATION 1
ASSISTANCE CONCERNING THE PLAN AND PLAN AGENT 1
THE PLAN 1
Purpose 1
Advantages to the Stockholders 1
Administration 2
Eligibility 2
Participation by Stockholders 3
Reinvestment of Dividends 4
Optional Purchases 4
Purchases 5
Dividends on Shares Held in the Plan 6
Costs 6
Reports to Participants 6
Certificates for Shares Held Under the Plan 6
Complete or Partial Withdrawal from Participation in the Plan 7
Voting 8
Tax Consequences of Participation 9
Backup Withholding 10
Other Information 10
COMMON STOCK 11
COMMON STOCK PRICE AND DIVIDENDS 11
GENERAL 12
THE CORPORATION
The Corporation is a Delaware corporation that was incorporated in 1982 for
the purpose of becoming a multi-bank holding company. The subsidiaries of the
Corporation include a commercial bank that is a national banking association,
four nonbank Affiliates that offer trust, investment advisory, credit life
insurance and mortgage banking related services in the same markets served by
the bank and two inactive Illinois state-chartered banks. The Corporation is
Illinois' third largest publicly-traded bank holding company with assets of
approximately $3 billion at September 30, 1995. The Corporation's office is
located at 300 Park Boulevard, Suite 405, Itasca, Illinois, 60143 and its
telephone number is 708-875-7450.
ASSISTANCE CONCERNING THE PLAN AND PLAN AGENT
All correspondence concerning the Plan should include your account number and
be addressed to the Agent for the Plan as follows: American Stock Transfer &
Trust Company; 40 Wall Street; New York, NY 10005; telephone 800-937-5449.
THE PLAN
The Plan consists of the following numbered questions and answers.
PURPOSE
1. WHAT IS THE PURPOSE OF THE PLAN?
The purpose of the Plan is to provide the eligible stockholders of the
Corporation, as defined by Question 4, with a convenient and economical
way of investing cash dividends and optional purchase payments in shares
of Common Stock without incurring any brokerage commissions, service
charges or similar costs. The proceeds from the sale of Common Stock
pursuant to the Plan may be used for general corporate purposes,
including investments in, or extensions of credit to, the Corporation's
banking and investment management subsidiaries. Additionally, the
Corporation may also use the proceeds for acquisition of banking and
certain non-banking assets as allowed by regulation and law.
ADVANTAGES TO THE STOCKHOLDERS
2. WHAT ARE THE ADVANTAGES TO STOCKHOLDERS OF PARTICIPATING IN THE PLAN?
The advantages are as follows:
(a) The Plan provides participants with three investment options.
Each participant may:
(i) automatically reinvest dividends on all full and
fractional shares of Common Stock and may make
optional purchases of shares of Common Stock totaling
no more than $5,000 per calendar quarter, with a
minimum of $100 per payment; or
(ii) automatically reinvest dividends on any portion of
their full and fractional shares of Common Stock and
may make optional purchases of shares of Common Stock
totaling no more than $5,000 per calendar quarter with
a minimum of $100 per payment; or
(iii) only make optional purchases totaling no more than
$5,000 per calendar quarter, with a minimum of $100
per payment, of shares of Common Stock.
(b) Participants will not incur any brokerage commissions, service
charges or similar costs in connection with purchases under the
Plan.
(c) All dividends on full or fractional shares purchased with either
reinvested dividends or with optional purchases will be
automatically reinvested under the Plan.
(d) Participants' funds will be fully invested under the Plan, because
the Plan permits fractional shares, as well as full shares, to be
credited to participants' accounts.
(e) Participants will avoid the need for safekeeping of the stock
certificates for shares credited to their respective accounts
under the Plan.
(f) Periodic statements of account will provide each participant with
a convenient record of each transaction under the Plan.
ADMINISTRATION
3. WHO ADMINISTERS THE PLAN FOR PARTICIPANTS?
American Stock Transfer & Trust Company, at the direction of the
Corporation, will be the Agent for the participants in the Plan and will
administer the Plan, maintain its records, send periodic statements of
account to participants and perform other duties relating to the Plan.
The Agent also acts as dividend disbursing and transfer agent for the
Corporation.
ELIGIBILITY
4. WHO IS ELIGIBLE TO PARTICIPATE IN THE PLAN?
All Common Stock shareholders of record are eligible to participate in
the Plan. If the Common Stock is registered in a name other than that
of the stockholder (for example, in the name of a broker or other
nominee), the stockholder who wants to participate in the Plan must
either make appropriate arrangements for the nominee to participate in
the Plan, or the stockholder must become a stockholder of record by
having all or a portion of such shares transferred to the stockholder's
own name.
PARTICIPATION BY STOCKHOLDERS
5. HOW DOES AN ELIGIBLE STOCKHOLDER PARTICIPATE?
Participation in the Plan is entirely voluntary. Any eligible
stockholder may join the Plan at any time by completing an Authorization
Form and returning it to the Agent. A stockholder may obtain an
Authorization Form by writing to or calling the Agent.
If a stockholder has shares of Common Stock registered in multiple
accounts the stockholder should complete an Authorization Form for each
such account. In that case the stockholder has the election of signing
and returning any or all such Authorization Forms, specifying on each
the number of shares on which dividends should be reinvested for each
account. Those stockholders who do not elect to participate in the Plan
will continue to receive cash dividends at such times as dividends are
paid to all stockholders.
6. WHAT ARE THE OPTIONS THAT THE AUTHORIZATION FORM PROVIDES?
The Authorization Form allows each participant to decide the extent of
their participation in the Plan through any of the following three
investment options:
(a) "FULL DIVIDEND REINVESTMENT" permits a participant to reinvest
dividends on all shares of Common Stock, currently owned or
subsequently registered in the participant's name, in additional
shares of Common Stock in accordance with the Plan. This option
also permits the participant to make optional purchases of
additional shares in accordance with the Plan.
(b) "PARTIAL DIVIDEND REINVESTMENT" permits a participant to specify
the number of shares registered in the participant's name on which
the participant desires dividends to be reinvested. This option
also permits the participant to make optional purchases of
additional shares in accordance with the Plan.
(c) "OPTIONAL PURCHASES" permits a participant to make optional
purchases of additional shares of Common Stock in accordance with
the Plan, whether or not the participant's dividends are being
reinvested.
7. HOW MAY A PARTICIPANT CHANGE OPTIONS UNDER THE PLAN?
A participant may change participation in the Plan at any time by
completing a revised Authorization Form and returning it to the Agent or
by submitting a written request to the Agent.
REINVESTMENT OF DIVIDENDS
8. WHEN WILL DIVIDENDS BE REINVESTED?
Cash dividends on the Common Stock historically have been paid by the
Corporation during the months of January, April, July and October.
Shares purchased from the Corporation with reinvested dividends will be
purchased on the "Dividend Investment Date" (the same date as the
Dividend Payment Date as fixed by the Corporation's Board of Directors),
while shares purchased on the open market with reinvested dividends will
be purchased during the "Dividend Investment Period" (the period during
the five business days preceding and the five business days following
the Dividend Investment Date). No interest will be paid by the
Corporation on dividends awaiting reinvestment.
Any changes in a participant's method of participating in the dividend
reinvestment feature of the Plan will become effective as of the next
succeeding Dividend Investment Date if written notice of such intention
is received by the Agent on or before the record date for the related
dividend payment.
OPTIONAL PURCHASES
9. WHAT IS THE MINIMUM AND MAXIMUM INVESTMENT WITH OPTIONAL PURCHASES, AND
WHEN CAN THEY BE MADE?
A participant may make optional purchases totaling no more than $5,000
per calendar quarter, with a minimum of $100 per purchase. The Agent
will return optional purchase payments to the extent that the aggregate
optional purchase payments in any calendar quarter exceed $5,000 or are
less than $100. The same optional purchase payment need not be sent
each quarter, nor does the participant need to make a payment in each
quarter. There is no obligation to use, nor any penalty for not using,
the optional purchases feature of the Plan.
10. HOW DOES THE "OPTIONAL PURCHASES" INVESTMENT OPTION OPERATE?
If a participant chooses to make optional purchases, and not elect the
dividend reinvestment option, the Agent will pay cash dividends on all
shares registered in the participant's account and will apply any
optional purchase payments received from the participant to the purchase
of additional shares of Common Stock for the participant's account in
the Plan. The Agent will also reinvest all future cash dividends on
shares in the Plan purchased pursuant to the optional purchases feature
of the Plan.
An optional purchase payment may be made by a stockholder when
enrolling, whether or not the dividend reinvestment option is selected,
by enclosing a check (made payable to American Stock Transfer & Trust
Company) with the Authorization Form. Thereafter, optional purchases
may be made by submitting a check accompanied by the payment stub which
will be attached to each periodic statement sent to the participant by
the Agent. Additional stubs will be supplied to any participant upon
request of the Agent.
11. WHEN WILL OPTIONAL PURCHASE PAYMENTS RECEIVED BY THE AGENT BE INVESTED
AND CAN THEY BE RETURNED TO THE PARTICIPANT UPON REQUEST?
Optional purchase payments will be invested monthly. Shares purchased
from the Corporation will be purchased on the "Cash Investment Date" and
shares purchased on the open market will be purchased during the "Cash
Investment Period". The Cash Investment Date will be the Dividend
Investment Date in months when dividends are paid by the Corporation and
the third business day of the month in months when dividends are not
paid by the Corporation. The Cash Investment Period will be during the
five business days preceding and the five business days following the
Dividend Investment Date or the Cash Investment Date, as applicable. No
interest will be paid by the Corporation on optional purchase payments
awaiting investment.
In order to allow sufficient time for processing, optional purchase
payments must be received by the Agent no later than the day prior to
the Cash Investment Date. Additionally, optional purchase payments will
be refunded if a written request for refund in received by the Agent no
later than the third to the last business day of the month.
PURCHASES
12. HOW MANY SHARES OF COMMON STOCK WILL BE PURCHASED FOR PARTICIPANTS?
Each participant's account will be credited with the number of shares,
including fractions computed to three decimal places, equal to the total
amount to be invested from reinvested dividends and optional purchase
payments, divided by the applicable purchase price of each share (as
determined in Question 14).
13. WHAT IS THE SOURCE OF SHARES PURCHASED UNDER THE PLAN?
Shares purchased under the Plan may come from authorized shares of
Common Stock of the Corporation or from shares purchased on the open
market. The decision to issue new shares or to purchase shares on the
open market is solely that of the Corporation. Additionally, shares
purchased on the open market will be made on such terms, including price
and settlement date, as the Corporation solely deems appropriate.
14. WHAT WILL BE THE PRICE OF THE SHARES OF COMMON STOCK PURCHASED UNDER THE
PLAN?
(a) If shares are purchased from the Corporation:
(i) With reinvested dividends - Shares will be purchased
at 100% of the average of the high and low prices for
the Common Stock as reported by the NASDAQ Stock
Market for the five days on which the shares are
traded immediately preceding the applicable Dividend
Investment Date;
(ii) With optional purchase payments - Shares will be
purchased at 100% of the average of the high and low
prices for the Common Stock as reported by the NASDAQ
Stock Market for the five days on which shares are
traded immediately preceding the applicable Cash
Investment Date.
(b) If shares are purchased on the open market:
(i) With reinvested dividends - Shares will purchased at
100% of the average cost of all shares purchased
during the applicable Dividend Investment Period;
(ii) With optional purchase payments - Share will be
purchased at 100% of the average cost of all shares
purchased during the applicable Cash Investment
Period.
DIVIDENDS ON SHARES HELD IN THE PLAN
15. WHAT IS DONE WITH DIVIDENDS PAID ON SHARES HELD IN ACCOUNTS UNDER THE
PLAN?
All dividends paid on full and fractional shares held in the Plan will
be automatically reinvested in additional shares of Common Stock under
the Plan.
COSTS
16. WHAT ARE THE COSTS TO PARTICIPANTS IN CONNECTION WITH PURCHASES UNDER
THE PLAN?
Participants will not incur any brokerage commissions, service charges
or similar costs in connection with purchases under the Plan.
Additionally, costs of administration of the Plan are incurred by the
Corporation.
REPORTS TO PARTICIPANTS
17. HOW WILL PARTICIPANTS BE ADVISED OF THEIR PURCHASE OF STOCK?
As soon as practicable after each reinvestment or purchase is completed
by the Agent, each participant will receive a statement detailing their
account activity. These statements are a participant's continuing record
of the cost of purchases and should be retained for income tax purposes.
In addition, each participant will receive copies of those corporate
communications distributed to all stockholders, including quarterly
reports, annual report, notices of stockholders' meeting and proxy
statements of the Corporation.
CERTIFICATES FOR SHARES HELD UNDER THE PLAN
18. WILL STOCK CERTIFICATES BE ISSUED FOR SHARES OF COMMON STOCK PURCHASED?
Normally, certificates for shares of Common Stock purchased under the
Plan will not be issued to participants. The number of shares credited
to an account under the Plan will be shown on the participant's
statement of account. This convenience to the Plan participant protects
against loss, theft or destruction of stock certificates. However, if a
participant wishes to obtain certificates for any number of whole shares
credited to an account under the Plan, without withdrawing from the
Plan, he/she may do so by mailing a written request to the Agent.
Because the Corporation does not issue fractional shares, certificates
for fractional shares will not be issued to a participant under any
circumstances.
Shares credited to the account of a participant under the Plan may not
be pledged. A participant who wishes to pledge such shares must request
that certificates for such shares be issued in the participant's name.
19. IN WHOSE NAME WILL ACCOUNTS BE MAINTAINED AND CERTIFICATES REGISTERED
WHEN ISSUED?
Accounts for each participant will be maintained by the Agent in the
participant's name as shown on the Corporation's records (the "account
name") at the time the participant enters the Plan. When issued,
certificates for full shares will be registered in that account name.
Upon written request, certificates also may be registered and issued in
names other than the account name subject to compliance with any
applicable laws and the payment by the participant of any applicable
taxes, provided that the request bears the signature of the participant
and the signature is guaranteed by a commercial bank or trust company or
by a member of the New York Stock Exchange or other stock exchanges.
COMPLETE OR PARTIAL WITHDRAWAL FROM PARTICIPATION IN THE PLAN
20. MAY A PARTICIPANT WITHDRAW FROM THE PLAN AT ANY TIME?
The Plan is entirely voluntary and a participant may request to withdraw
from the Plan at any time. However, should the participant wish to
simply change options under the Plan, or should the participant wish to
receive certificates for all or a portion of whole shares held under the
Plan, see Questions 7 and 18, respectively.
21. HOW DOES A PARTICIPANT WITHDRAW FROM THE PLAN?
In order to withdraw from the Plan, a participant must notify the Agent,
in writing, of the request to withdraw. When a participant withdraws
from the Plan, or upon termination of the Plan by the Corporation,
certificates for full shares credited to a participant's account under
the Plan will be issued and a cash payment will be made for any
fractional shares.
If the request to withdraw is received on or after the record date for a
dividend, any cash dividend paid on the Dividend Payment Date will be
reinvested in the Common Stock and credited to the participant's account
in accordance with the participant's previous instructions under the
Plan. Thereafter, all dividends will be paid in cash to the
participant.
Any optional purchase payments sent to the Agent prior to the request to
withdraw will be invested in Common Stock unless the participant's
withdrawal letter expressly requests return of the optional purchase
payments and such letter is received no later than the third to the last
business day of the month. The request to withdraw will then be
processed as promptly as possible following such date.
22. WHEN MAY A STOCKHOLDER REJOIN THE PLAN?
Generally, an eligible stockholder may rejoin the Plan at any time.
However, the Corporation reserves the right to reject any Authorization
Form from a previous participant on grounds of excessive joining and
termination. Such reservation is only intended to minimize
administrative expense and to encourage use of the Plan as a long-term
investment service.
23. WHAT HAPPENS WHEN A PARTICIPANT SELLS OR TRANSFERS ALL OF THE SHARES
REGISTERED IN HIS OR HER NAME, OTHER THAN SHARES UNDER THE PLAN?
If a participant disposes of all shares of stock registered in his/her
name other than shares under the Plan, the Agent will, unless otherwise
instructed by the participant, continue to reinvest the dividends on the
shares still credited to the participant's account under the Plan. If a
participant, however, has only a fractional share of stock credited to
his/her account under the Plan on the record date for any cash dividend
on the Common Stock, the Corporation reserves the right not to reinvest
any additional dividends on such fractional share and pay the
participant in cash for such fractional shares and any dividend thereon.
The cash payment for the fractional share will be based upon the closing
market price of the Common Stock as reported by the NASDAQ Stock Market
for the business day prior to the date the Corporation elects to make
such cash payment to the participant.
24. WHAT HAPPENS TO A FRACTIONAL SHARE WHEN A PARTICIPANT WITHDRAWS FROM THE
PLAN?
When a participant withdraws from the Plan, a cash payment representing
any fractional share will be mailed to the participant. The cash
payment will be based upon the closing market price of the Common Stock
as reported by the NASDAQ Stock Market for the business day prior to the
date of processing of the withdrawal by the Agent.
VOTING
25. HOW WILL A PARTICIPANT'S SHARES HELD UNDER THE PLAN BE VOTED AT MEETINGS
OF STOCKHOLDERS?
Each participant will receive a single proxy card covering both: (i)
those shares of Common Stock credited to the participant's account under
the Plan, and (ii) those shares registered in the participant's name
that are not within the Plan. If the proxy card is returned properly
signed and marked for voting, all of the shares will be voted as marked.
The total number of full shares held may be voted in person at
stockholders' meetings in accordance with instructions contained in the
Corporation's Proxy Statement.
If a proxy card is returned properly signed but without indicating
instructions as to the manner in which shares are to be voted with
respect to any item, all of the participant's shares will be voted (to
the extent legally permissible) in accordance with the recommendations
of the Board of Directors of the Corporation. This procedure is
consistent with the actions taken with respect to stockholders who are
not participating in the Plan and who return properly signed proxy cards
and do not provide voting instructions. If the proxy card is not
returned, or if it is returned unsigned or improperly signed, none of
the participant's shares covered by such proxy card will be voted unless
the participant or his or her duly appointed representative votes in
person at the meeting.
TAX CONSEQUENCES OF PARTICIPATION
26. WHAT AMOUNT OF DIVIDEND INCOME WILL PARTICIPANTS IN THE PLAN REPORT ON
THEIR FEDERAL INCOME TAX RETURNS?
A Participant will, to the extent dividends are reinvested, be treated
for Federal income tax purposes as having received, on the Dividend
Payment Date, a dividend in an amount equal to the fair market value of
the shares purchased with reinvested dividends. To the extent dividends
are received in cash, such amount will be considered a dividend for
Federal income tax purposes.
27. HOW WILL THE PARTICIPANT'S TAX BASIS IN SHARES PURCHASED BE DETERMINED?
A participant who is credited with shares through the dividend
reinvestment feature of the Plan will have a basis in those shares equal
to the amount of the dividend as determined in Question 26 above. A
participant in the optional purchases feature of the Plan will have a
basis in those shares equal to the fair market value of the shares
acquired on the Cash Investment Date or during the Cash Investment
Period.
28. WHEN DOES THE HOLDING PERIOD BEGIN FOR SHARES CREDITED TO A PARTICIPANT
IN THE PLAN?
For shares credited to the participant through the dividend reinvestment
feature of the Plan, the holding period will begin on the day following
the date of distribution of the dividend. For shares credited to the
participant through the optional purchases feature of the Plan, the
holding period will begin on the day following the day such shares are
purchased.
29. WILL A PARTICIPANT REALIZE ANY TAXABLE INCOME UPON THE RECEIPT OF STOCK
CERTIFICATES REPRESENTING SHARES THAT WERE CREDITED TO THE PARTICIPANT'S
ACCOUNT?
A participant will not realize any taxable income upon the receipt of
stock certificates representing shares credited to the participant's
account. This is true whether the certificates are received upon the
participant's request, withdrawal from the Plan or termination of the
Plan.
30. WILL A PARTICIPANT REALIZE ANY TAXABLE INCOME AS A RESULT OF THE
CORPORATION'S PAYMENT OF THE AGENT'S FEES FOR ADMINISTERING THE PLAN?
A participant in the Plan will not realize any taxable income as a
result of the Corporation's payment of the Agent's fees for
administering the Plan.
BACKUP WITHHOLDING
31. WILL THE CORPORATION WITHHOLD FEDERAL INCOME TAXES IF THE PARTICIPANT
FAILS TO PROVIDE THE CORPORATION WITH A SOCIAL SECURITY OR TAX
IDENTIFICATION NUMBER?
Federal law requires that Federal income tax be withheld (commonly
called "backup withholding") from dividends payable to participants who
fail to provide the Corporation with their social security or other tax
identification number in the manner required by law or where the
Internal Revenue Service (the "IRS") notifies the Corporation that
backup withholding is required from the participant. The Corporation
cannot refund backup withholding. Participants subject to backup
withholding should contact their tax advisors or the IRS for
information.
To avoid backup withholding, a participant must provide the Agent with a
completed copy of the Corporation's substitute Form W-9 containing the
participant's social security or other tax identification number. A
participant may obtain a substitute Form W-9 by requesting one from the
Agent. Any dividend paid to such participant subsequent to the receipt
of the substitute Form W-9 will not be subject to backup withholding
unless the IRS notifies the Corporation to the contrary.
OTHER INFORMATION
32. WHAT HAPPENS IF THE CORPORATION DECLARES A STOCK DIVIDEND OR STOCK
SPLIT?
Any shares of the Corporation's Common Stock issued in connection with a
stock split or dividend distributed by the Corporation will be credited
to the participant's account. As soon as practicable after the
declaration of a stock dividend or stock split, a statement will be sent
to each participant which will indicate the number of shares of Common
Stock credited to each participant's account under the Plan as a result
of the stock dividend or stock split. A participant may receive a
certificate for such shares (other than fractional shares) at any time
by sending a written request to the Agent.
33. MAY THE PLAN BE CHANGED OR DISCONTINUED?
While the Corporation presently intends to continue the Plan
indefinitely, the Corporation reserves the right to amend, suspend,
modify or terminate the Plan at any time. Notice of any such amendment,
suspension or modification will be sent to participants. Should the
Corporation decide to terminate the Plan, it will provide participants
with at least 30 days notice of such action. The Corporation reserves
the right to impose a minimum number of shares required to participate
in the Plan.
34. WHAT IS THE RESPONSIBILITY OF THE CORPORATION AND THE AGENT UNDER THE
PLAN?
The Corporation and its Agent administering the Plan will not be liable
for any act done in good faith or for any omission to act in good faith,
including, without limitation, any claim of liability arising out of
failure to terminate a participant's account upon a participant's death
prior to receipt of notice in writing of such death.
The participant should recognize that neither the Corporation nor the
Agent can assure the participant of a profit or protect against a loss
on the shares purchased under the Plan. An investment in the
Corporation's Common Stock is, as are all equity investments, subject to
significant market fluctuations.
35. WHO INTERPRETS AND REGULATES THE PLAN?
The Corporation reserves the sole right to interpret and regulate the
Plan as may be necessary or desirable in connection with the operation
of the Plan. The Plan will be governed by the laws of the state of
Delaware.
COMMON STOCK
Holders of the Corporation's Common Stock are entitled to share, on a pro-rata
basis, in dividends payable in cash, stock or other property, where as and if
declared by the Board of Directors of the Corporation. In the event of any
liquidation, dissolution or winding-up, the holders of the Common Stock are
entitled to receive, on a share for share basis, any assets or funds of the
Corporation which are distributable to its holders of Common Stock upon such
events. Holders of the Common Stock are entitled to one vote for each share
held on all matters voted upon by stockholders. Holders of Common Stock are
not entitled to preemptive rights or to cumulative voting rights. The shares
of Common Stock issued or to be issued upon receipt of payment by the
Corporation in accordance with the terms set forth in the Plan will be validly
issued, fully paid and non-assessable.
On February 15, 1989, the Corporation's Board of Directors adopted a Rights
Agreement, and pursuant thereto, declared a distribution of one Right for each
outstanding share of the Corporation's Common Stock held of record on March 1,
1989. On November 15, 1995, the Board of Directors adopted an Amended and
Restated Rights Agreement. Each Right entitles the registered holder to
purchase from the Corporation one one-hundredth of a share of participating
preferred stock for the Exercise Price ($100), subject to adjustment. The
Rights are exercisable only upon the occurrence of certain defined events,
including, but not limited to, the acquisition by any person of 10% or more of
the Corporation's Common Stock. The Rights may be redeemed by the Board of
Directors at a redemption price of $0.01 per Right at those times specified in
the Amended and Restated Rights Agreement. The Rights expire on November 15,
2005. As a result of the Rights distribution, 200,000 of the 1,000,000 shares
of the Corporation's authorized preferred stock have been reserved for
issuance as Series A Preferred Stock.
COMMON STOCK PRICE AND DIVIDENDS
As of December 1, 1995, the closing price for the Corporation's Common Stock
by the NASDAQ Stock Market was $28.875. The Corporation's Common Stock is
traded on the NASDAQ Stock Market under the symbol of "FMBI". Quotations can
be found within the NASDAQ Stock Market listings that appear in most daily
newspapers. The Corporation has paid quarterly dividends without interruption
since its inception on April 1, 1983.
GENERAL
The Corporation's Restated Certificate of Incorporation and By-laws, pursuant
to Section 145 of the Delaware General Corporation Law, authorize (and, under
some circumstances, require) indemnification of directors and officers of the
Corporation and certain others against certain liabilities, including
liabilities arising under the Securities Act of 1933, as amended (the "Act").
In addition, the Corporation is required to provide indemnification against
certain liabilities by the terms of certain Indemnity Agreements which have
been entered into by the Corporation with its directors and certain of its
officers. Insofar as indemnification for liabilities arising under the Act
may be permitted to directors and officers of the Corporation, the Corporation
has been informed that, in the opinion of the Securities and Exchange
Commission, such indemnification is against public policy as expressed in the
Act and is therefore unenforceable.
