DEF 14A
1
c70354def14a.txt
DEFINITIVE PROXY STATEMENT
SCHEDULE 14A
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 Section 240.14a-12
First Busey Corporation
--------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
First Busey Corporation
--------------------------------------------------------------------------------
(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:
--------------------------------------------------------------------------------
FIRST BUSEY CORPORATION
201 W. MAIN, URBANA, IL 61801
217/365-4556
March 15, 2002
Dear Stockholder:
The Annual Meeting of Stockholders of First Busey Corporation will be
held on Monday, April 15, 2002, at the Festival Theatre of the Krannert Center
for the Performing Arts, 500 South Goodwin Avenue, 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 2003 Annual
Meeting 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, 2002.
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
FIRST BUSEY CORPORATION
201 W. MAIN, URBANA, IL 61801
217/365-4556
NOTICE OF 2002 ANNUAL MEETING OF STOCKHOLDERS
To Be Held April 15, 2002
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 Festival Theatre of
the Krannert Center for the Performing Arts, 500 South Goodwin Avenue, Urbana,
Illinois, on Monday, April 15, 2002, at 7:00 p.m. for the following purposes:
1. To elect 14 directors of the Company to serve until the 2003 Annual
Meeting 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, 2002.
3. To transact such other business as may properly come before the
Annual Meeting or any postponement or adjournment thereof.
Only stockholders of record at the close of business on February 15,
2002 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
President and Chief Operating Officer,
Corporate Secretary and Treasurer
Urbana, Illinois
March 15, 2002
-2-
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 for use at the
Annual Meeting of Stockholders. The Board has fixed the close of business on
February 15, 2002, 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 13,676,888 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, 2001, accompanies this Proxy
Statement. The approximate date on which the Proxy Statement and the
accompanying proxy are first being sent to stockholders is March 15, 2002.
VOTING
General. Shares of Common Stock represented by properly executed
proxies received by the Company will be voted at the Annual Meeting in
accordance with the instructions on the proxies. If there are no such
instructions, the shares will be voted "FOR" (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, 2002. 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 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 the 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" each of the proposals. As of February 15, 2002,
these individuals beneficially owned an aggregate of 4,618,324 shares, or
approximately 34.78% 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-
SOLICITATION
The Company will pay the cost of solicitation of proxies. In addition
to solicitation by mail, officers, directors and regular employees of the
Company may solicit proxies by telephone, telefax or in person without
additional compensation. Brokerage houses, bank nominees, fiduciaries and other
custodians will be requested to forward soliciting material to the beneficial
owners of shares held of record by them and will be reimbursed for their
reasonable expenses.
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
of Directors.
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 February 15,
2002, the record date for the Annual Meeting. Unless otherwise noted, nominees
for director have been employed in their principal occupation with the same
organization for at least the last 5 years.
JOSEPH M. AMBROSE
Director since: 1993
Age: 44
Mr. Ambrose has served as Executive Vice President of AFNI, Inc., Bloomington,
Illinois since January 1999. Prior to that, Mr. Ambrose was an attorney with the
firm Hinshaw & Culbertson, Bloomington, Illinois.
SAMUAL P. BANKS
Director since: 1996
Age: 47
Mr. Banks is President and Chief Executive Officer of Cunningham Children's
Home, Urbana, Illinois. Mr. Banks has been associated with Cunningham Children's
Home since 1982.
T. O. DAWSON
Director since: 1995
Age: 61
Mr. Dawson is a retired Senior Vice President of Acordia, Inc., Champaign,
Illinois. Prior to being named Senior Vice President of Acordia in 1999, Mr.
Dawson was a partner in the firm of Insurance Risk Managers, Ltd., Champaign,
Illinois, which was acquired by Acordia.
VICTOR F. FELDMAN
Director since: 1996
Age: 66
Dr. Feldman is an ophthalmologist at Christie Clinic, Champaign, Illinois. Dr.
Feldman had been associated with Christie Clinic since 1967.
-4-
KENNETH M. HENDREN
Director since: 1996
Age: 55
Mr. Hendren is a self-employed farmer in LeRoy, Illinois.
E. PHILLIPS KNOX
Director since: 1980
Age: 55
Mr. Knox is an attorney with the firm Tummelson Bryan & Knox, Urbana, Illinois.
BARBARA J. KUHL
Director since: 2001
Age: 51
Mrs. Kuhl has served as President and Chief Operating Officer of First Busey
Corporation since November 2000. Previously, Mrs. Kuhl served in various
management capacities since joining Busey Bank in 1974. Mrs. Kuhl is married to
P. David Kuhl, a director.
P. DAVID KUHL
Director since: 1996
Age: 52
Mr. Kuhl has served as President and Chief Executive Officer of Busey Bank since
June 1991. Previously, 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. Mr. Kuhl is married to Barbara J. Kuhl, a director.
V. B. LEISTER, JR.
Director since: 1996
Age: 56
Mr. Leister is President of Carter's Moving & Storage, Inc., and Vice President
& Treasurer of Carter's Furniture Inc., Urbana, Illinois.
DOUGLAS C. MILLS
Director since: 1980
Age: 61
Mr. Mills has served as Chairman of the Board and Chief Executive Officer of
First Busey Corporation since its incorporation. He has been associated with
Busey Bank since 1971 when he assumed the position of Chairman of the Board. Mr.
Mills is married to Linda M. Mills, a director.
LINDA M. MILLS
Director since: 1996
Age: 61
Mrs. Mills is active with various charitable organizations and previously served
as Chairman of the Board of Busey Travel, Champaign, Illinois. Mrs. Mills is
married to Douglas C. Mills, a director.
DAVID C. THIES
Director since: 1996
Age: 46
Mr. Thies is an attorney with the law firm of Webber & Thies, P.C., Urbana,
Illinois.
EDWIN A. SCHARLAU II
Director since: 1984
Age: 57
Mr. Scharlau has served as Chairman of the Board of Busey Investment Group, Inc.
since January 2001 and First Busey Securities, Inc., since June 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.
-5-
ARTHUR R. WYATT
Director since: 1995
Age: 74
Mr. Wyatt is a Professor of Accounting at the University of Illinois-Urbana and
Chairman of the Board of Inprimis, Inc., Boca Raton, Florida.
During 2001, the Board held 12 meetings. All directors attended at
least 75% of the meetings of the Board and the committees on which they served
during 2001.
The Board of Directors of the Company has established the following
committees, among others, to assist in the discharge of its responsibilities.
The Audit Committee met four times in 2001. Members of the Audit
Committee are Messrs. Ambrose (Chairman), Hendren, Thies, and Wyatt. The
function of the Audit Committee and its activities during 2001 are described in
detail under the heading Report of the Audit Committee.
The Executive Management Compensation and Succession Committee met four
times in 2001. Members of the Compensation Committee ARE Messrs. Wyatt
(Chairman), Feldman and Knox.
First Busey does not have a formal nominating committee. The Board of
Directors, as a whole, performs the function of nominating members for the
Board.
During 2001, non-employee directors of First Busey received $600 for
each meeting held. 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. Options were granted on
February 19, 2001, in accordance with the plan, to non-employee directors opting
for such alternative at a price of $17.875 per share, the closing price of the
Common Stock on such date. These options became exercisable on January 15, 2002
and expire on December 15, 2005. Directors Ambrose, Banks, Dawson, Hendren,
Knox, Leister, Mills, Parker and Wyatt chose to receive stock options. Directors
who are also employees of First Busey or any of its subsidiaries receive no
additional compensation for attending Board of Directors' meetings.
In January 2001, the Board of Directors approved the payment of a
retainer for each non-employee director. Accordingly, each non-employee director
received a cash retainer of $7,500 for the fiscal year 2001. Non-employee
directors remain eligible for fees paid in connection with Board of Directors'
meetings.
REPORT OF THE AUDIT COMMITTEE
In accordance with its written charter adopted by the Board of
Directors, the Audit Committee of the Board assists the Board in fulfilling its
responsibility for the oversight of the quality and integrity of the accounting,
auditing and financial reporting practices of the Company. During the year, the
Committee met four times and also reviewed and discussed the interim financial
information contained in each quarterly earnings announcement with management
and the independent auditors prior to public release.
In discharging its oversight responsibility as to the audit process,
the Committee obtained from the independent auditors a formal written statement
describing all relationships between the auditors and the Company that might
bear on auditors' independence consistent with Independence Standards Board
Standard No. 1, "Independence Discussions with Audit Committees," discussed with
the auditors any relationships that may impact their objectivity and
independence and satisfied itself as to the auditors' independence. The
Committee also discussed with management, the internal auditors and the
independent auditors the quality and adequacy of the Company's internal controls
and internal audit
-6-
function's organization, responsibilities, budget and staffing. The Committee
reviewed with both the independent and internal auditors their audit plans,
scope, and identification of audit risk areas.
The Committee discussed and reviewed with the independent auditors all
communications required by auditing standards, generally accepted in the United
States of America including those described in Statement on Auditing Standards
No. 61, as amended, "Communication with Audit Committees," and discussed and
reviewed the results of the independent auditors' examination of the
consolidated financial statements. The Committee also discussed the results of
the internal audit examinations.
The Committee reviewed the consolidated audited financial statements of
the Company as of and for the year ended December 31, 2001, with management and
the independent auditors. Management has the responsibility for the preparation
of the Company's consolidated financial statements and the independent auditors
have the responsibility for the audit of those statements.
Based upon the above-mentioned review and discussions with management
and the independent auditors, the Committee recommended to the Board that the
Company's audited consolidated financial statements be included in its Annual
Report on Form 10-K for the year ended December 31, 2001, for filing with the
Securities and Exchange Commission. The Committee also recommended the
reappointment, subject to stockholder approval, of the independent auditors and
the Board concurred in such recommendation.
AUDIT COMMITTEE
Joseph M. Ambrose (Chairman)
Kenneth M. Hendren
David C. Thies
Arthur R. Wyatt
COMMON STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding the
beneficial ownership of the Common Stock as of February 15, 2002 by all
directors and director nominees, by each person who is known by the Company to
be the beneficial owner of more than 5% of the outstanding Common Stock, by each
executive officer named in the Summary Compensation Table and by all directors
and executive officers as a group.
The number of shares beneficially owned by each director, director
nominee, 5% stockholder or executive officer is determined under rules of the
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 February 15, 2002 through the
exercise of any option or other right. Unless otherwise indicated, each person
has sole investment and voting power (or shares such powers with his or her
spouse) with respect to the shares set forth in the following table. In certain
instances, the number of shares listed includes, in addition to shares owned
directly, shares held by the spouse or children of the person, or by a trust of
which the person is a trustee or in which the person may have a beneficial
interest. In some cases, the person has disclaimed beneficial interest in
certain of these shares.
-7-
Name and Address of Beneficial Owner Common Stock Beneficially Owned
---------------------------------------- -------------------------------------------------------
Number of Shares Right to Percent of
Owned Acquire(1) Outstanding Shares
----- ---------- ------------------
Douglas C. Mills(2) 2,725,935 46,000 20.21%
201 E. Main Street
Urbana, Illinois 61801
Linda M. Mills(3) 720,200 9,000 5.33%
2123 Seaton Court
Champaign, Illinois 61821
A. Barclay Klingel, Jr.(4) 848,008 0 6.20%
Joseph M. Ambrose 30,410 9,000 .29%
Samuel P. Banks 5,234 9,000 .10%
T. O. Dawson 88,626 9,000 .71%
Victor F. Feldman 72,544 0 .53%
Kenneth M. Hendren 144,238 9,000 1.12%
E. Phillips Knox 200,250 9,000 1.53%
Barbara J. Kuhl(5) 89,435 11,500 .73%
P. David Kuhl(6) 88,331 25,000 .83%
V. B. Leister, Jr. 21,248 9,000 .22%
Edwin A. Scharlau II 364,156 25,000 2.84%
David C. Thies 3,950 0 .03%
Arthur R. Wyatt 63,768 9,000 .53%
All directors and executive officers as 4,618,324 179,500 34.78%
a group (14 persons)
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, 2001, its executive officers and directors
complied with all Section 16(a) filing requirements except for Director Ambrose
who was delinquent in reporting one disposition transaction. In making these
statements, the Company has relied upon the written representations of its
directors and executive officers.
----------------------
(1) Shares that can be acquired through stock options available for exercise.
(2) Includes 670,002 shares held by the Martin A. Klingel Estate for which Mr.
Mills shares voting and dispositive powers with A. Barclay Klingel, Jr.
Excludes 720,200 shares of common stock beneficially owned by Linda M.
Mills, Mr. Mills' spouse. Includes 21,242 shares of common stock owned by
Busey Mills Foundation and 1,000,000 shares of common stock owned by Mills
Investment LP.
(3) Excludes 2,725,935 shares of common stock beneficially owned by Douglas C.
Mills, Mrs. Mills' spouse. Includes 5,000 shares of common stock owned by
Mills Family Foundation and 30,000 shares of common stock owned by Mills
Family Trust.
(4) Includes 670,002 shares held by the Martin A. Klingel Estate for which Mr.
Klingel shares voting and dispositive powers with Douglas C. Mills. Also
includes 108,000 shares held in the Klingel Insurance Trust, for which Mr.
Klingel acts as sole trustee.
(5) Excludes 88,331 shares of common stock beneficially owned by P. David Kuhl,
Mrs. Kuhl's spouse.
(6) Excludes 89,435 shares of common stock beneficially owned by Barbara J.
Kuhl, Mr. Kuhl's spouse.
-8-
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 earning
at least $100,000 in 2001.
SUMMARY COMPENSATION TABLE
Restricted Stock Securities Underlying All Other
Name and Principal Positions Year Salary($) Bonus($)(1) Awards ($) Options/SARS (#) Compensation ($)(2)
---------------------------- ---- --------- ----------- ---------- ---------------- -------------------
Douglas C. Mills 2001 105,000 140,005 0 15,000 48,241
Chairman of the Board and Chief 2000 100,000 121,813 1,994 15,000 77,016
Executive Officer 1999 125,000 100,000 2,263 20,000 67,713
Edwin A. Scharlau II 2001 140,000 76,008 0 7,500 11,648
Chairman of the Board of Busey 2000 140,000 81,450 1,994 7,500 10,068
Investment Group 1999 150,000 50,000 2,263 10,000 13,791
P. David Kuhl 2001 140,000 79,991 0 7,500 11,617
President and Chief 2000 140,000 81,450 1,994 7,500 10,047
Executive Officer of Busey Bank 1999 150,000 50,000 2,263 10,000 12,988
Barbara J. Kuhl 2001 100,000 79,991 0 7,500 10,993
President, Corporate Secretary, 2000 80,000 62,875 1,994 -0- 7,512
Treasurer and Chief Operating Officer 1999 75,000 45,000 2,263 -0- 9,895
-------------------------
(1) Mr. Mills, Mr. Scharlau, Mr. Kuhl and Mrs. Kuhl received 694, 377, 396 and
396 shares of Common Stock, respectively, under the 2001 Management and
Associate Dividend Program. The shares were valued at the closing price on
November 20, 2001, the date the award was approved by the Board. The stock
values included for Mr. Mills, Mr. Scharlau, Mr. Kuhl and Mrs. Kuhl were
$14,005, $7,608, $7,991 and $7,991, respectively.
(2) The amounts disclosed in this column for 2001 include:
Company contributions of $8,387 on behalf of each individual under the
First Busey Corporation Profit Sharing Plan & Trust, a defined contribution
plan.
Discretionary company contributions of $2,606 on behalf of each individual
under the First Busey Corporation Employee Stock Ownership Plan, a defined
contribution plan.
Compensation value of split-dollar life insurance policies on Mr. Mills in
the amount of $37,248. The Company will be reimbursed for all premiums paid
on the policies, without interest, from the proceeds of the policies. Mr.
Mills currently has two $10,000,000 split-dollar life insurance policies.
The first policy was acquired in 1992 and the second policy was acquired in
2000. Split-dollar life insurance policies were acquired on Mr. Scharlau
and Mr. Kuhl in 1994. For 2001, $655 and $624, respectively, represent the
compensation value of these policies to Mr. Scharlau and Mr. Kuhl.
-9-
OPTION/SAR GRANTS IN LAST FISCAL YEAR
Potential Realizable Value at
Assumed Annual Rates of Stock Price
Individual Grants Appreciation for Option Term
----------------------------------------------------------------------------- -----------------------------------
Number of
Securities % of Total
Underlying Options Granted Exercise or
Options/SAR's to Employees in Base Price Expiration
Name Granted (#)(1) Fiscal Year ($/Share) Date 5%($) 10%($)
------------------------ -------------- --------------- ----------- ----------- -------- --------
Douglas C. Mills 15,000 24% $17.875 12/15/05 123,511 203,608
Edwin A. Scharlau II 7,500 12% $17.875 12/15/05 61,756 101,804
P. David Kuhl 7,500 12% $17.875 12/15/05 61,756 101,804
Barbara J. Kuhl 7,500 12% $17.875 12/15/05 61,756 101,804
(1) The options became exercisable on January 15, 2002.
AGGREGATED OPTIONS/SAR EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END
OPTIONS/SAR VALUES
The following table provides information on option exercises in fiscal
2001 by the named executive officers and the value of such officers' unexercised
options at December 31, 2001.
Number of Securities Underlying Value of Unexercised
Unexercised Options/SARs at In-the-Money Options/SARs at
December 31, 2001(#) December 31, 2001 ($)(1)
------------------------------------------------------------------
Shares
Acquired on Value
Name Exercise (#) Realized ($) Exercisable Unexercisable Exercisable Unexercisable
----------------------------------------------------------------------------------------------------------------------------
Douglas C. Mills 100,000 673,625 15,000 35,642 21,263 225,631
Edwin A. Scharlau II 22,500 213,750 17,500 22,200 42,931 142,769
P. David Kuhl 22,500 223,594 17,500 22,200 42,931 142,769
Barbara J. Kuhl 9,000 89,438 -0- 15,900 -0- 85,250
(1) Based on the closing price of Common Stock of $21.48 as quoted on the
Nasdaq National Market on December 31, 2001.
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, cash 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
February 2001, the Compensation
-10-
Committee recommended and the Board of Directors approved 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 2001. These levels were $1.12, $1.13, $1.14, and $1.15. 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.
Also as part of the 2001 MAD program, the Committee recommended and the Board
approve a stock award to key officers. Mr. Mills, Mr. Scharlau, Mr. Kuhl, and
Mrs. Kuhl received 694, 377, 396, and 396 shares, respectively.
COMPENSATION OF THE CHIEF EXECUTIVE OFFICER
Base Salary/MAD Program. Mr. Mills' 2001 base salary was set at
$105,000, representing a 5% increase from his base salary of $100,000 for 2000.
The Committee determined that under the MAD program, if the level of earnings
per share set by the Board was achieved, $1.12, $1.13, $1.14, or $1.15, Mr.
Mills' dividend would be 100%, 110%, 120%, or 133%, respectively, of his salary.
The minimum earnings per share target would have awarded Mr. Mills a dividend of
$105,000 with the highest level awarding Mr. Mills a dividend of $140,000. Based
on the Company's achievement of earnings per share of $1.15, Mr. Mills received
a cash dividend in the amount of $126,000 and 694 shares of stock with a market
value of $14,005 for a total MAD payment valued at $140,005.
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 interest 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. On February 20, 2001,
stock options representing 61,500 shares were granted to officers and directors
of the Company. Mr. Mills received a stock option for 15,000 shares.
COMPENSATION COMMITTEE
Arthur R. Wyatt (Chairman)
Victor F. Feldman
E. Phillips Knox
Notwithstanding anything to the contrary set forth in any of the
Company's previous filings under the Securities Act of 1933 or the Exchange Act
that might incorporate future filings, including this Proxy Statement, in whole
or in part, the preceding report and the Performance Table included below shall
not be incorporated by reference into any such filings.
COMPANY PERFORMANCE
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, 2001.
-11-
FIRST BUSEY CORPORATION
Stock Price Performance
[PERFORMANCE GRAPH]
PERIOD ENDING
-------------
INDEX 12/31/97 12/31/98 12/31/99 12/31/00 12/31/01
----- -------- -------- -------- -------- --------
First Busey Corporation 127.17 172.84 218.95 197.69 218.49
NASDAQ - Total US* 122.48 172.68 320.89 193.01 153.15
SNL Midwest Bank Index 162.14 172.46 135.50 164.09 167.69
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.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Mr. Knox, a director of the Company, is an attorney with Tummelson
Bryan & Knox, Urbana, Illinois, and provided legal and certain consulting
services to the Company during fiscal 2001. The dollar amount of the fees paid
to Tummelson Bryan & Knox by the Company during the 2001 fiscal year was
$109,991.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company's banking subsidiaries have, 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 the Company'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, 2001, these persons and companies were indebted to the Company's
banking subsidiaries for loans totaling approximately $3.596 million
representing 3.40% of total stockholders' equity. In addition to these loans,
the Company's banking subsidiaries make loans to officers of the Company's
subsidiaries who are not executive officers of First Busey.
-12-
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, 2002. 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 aggregate fees
billed for professional services rendered to the Company and related entities
for the 2001 fiscal year were:
Audit Fees $118,785
Financial Information Systems Design
and Implementation Fees $ 0
All Other Fees $ 82,530
The audit committee has determined that the provision of these services
is compatible with maintaining the principal accountant's independence.
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 2003
Annual Meeting 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 15, 2002. As to any proposal that a
stockholder intends to present to stockholders without inclusion in the
Company's Proxy Statement for the Company's 2003 Annual Meeting of 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 January 29, 2003.
Even if proper notice is received on or prior to January 29, 2003, 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
-13-
such proposal and how they intend to exercise their discretion to vote on such
matter, unless the stockholder making the proposal solicits proxies with respect
to the proposal to the extent required by Rule 14a-4(c)(2) under the Exchange
Act.
By order of the Board of Directors,
Barbara J. Kuhl
President and Chief Operating Officer,
Corporate Secretary and Treasurer
March 15, 2002
-14-
PROXY--FIRST BUSEY CORPORATION
KNOW ALL MEN BY THESE PRESENTS, THAT I, the undersigned stockholder of First
Busey Corporation (the "Company") having received notice of the Annual Meeting
of Stockholders, do hereby nominate, constitute and appoint, Tom Brown, my true
and lawful attorney and proxy, with full power of substitution, for me and in my
name, place and stead to vote all of the shares of Common Stock without par
value ("Common Stock") of the Company standing in my name on its books on
February 15, 2002 at the Annual Meeting of Stockholders of the Company, to be
held at the Krannert Center for the Performing Arts, 500 South Goodwin Avenue,
Urbana, Illinois, on April 15, 2002 at 7:00 p.m., local time, and at any
postponement or adjournment thereof, with all powers the undersigned would
possess if personally present, as follows:
1. [ ] FOR all nominees listed below to serve as directors of the Company
until the next Annual Meeting of Stockholders (except as marked to the
contrary below)
[ ] WITHHOLD AUTHORITY to vote for all nominees listed below
Joseph M. Ambrose Linda M. Mills P. David Kuhl T. O. Dawson Edwin A. Scharlau II
V. B. Leister, Jr. E. Phillips Knox Victor F. Feldman Samuel P. Banks David C. Thies
Douglas C. Mills Barbara J. Kuhl Kenneth M. Hendren Arthur R. Wyatt
(INSTRUCTION: To withhold authority to vote for any individual
nominee, strike a line through that nominee's name.)
2. [ ] FOR [ ] AGAINST [ ] ABSTAIN
Ratification of the appointment of the firm of McGladrey & Pullen, LLP as
the Company's independent auditors for the fiscal year ending December 31,
2002.
To transact such other business as may properly come before the Annual
Meeting or any postponement or adjournment thereof.
This proxy will be voted as directed, or if no instructions are given, it will
be voted "FOR" election of all nominees as Directors of First Busey Corporation
and "FOR" the ratification of McGladrey & Pullen, LLP as the Company's
independent auditors. Also, this proxy will be voted at the Annual Meeting in
accordance with the Board of Directors' recommendations on any other matters
which may come before the Annual Meeting or any postponement or adjournment
thereof.
This proxy is solicited on behalf of the Board of Directors and may be revoked
prior to its exercise.
Your vote is important. Any previously submitted proxies will not be used at the
Annual Meeting. Accordingly, even if you plan to attend the Annual Meeting,
please mark, sign and date this proxy and return it in the enclosed envelope.
------------------------------------------------
------------------------------------------------
Please sign your name or names exactly as they
appear on the stock certificate. Each joint
tenant must sign. When signing as attorney,
administrator, guardian, executor or trustee or
as an officer of a corporation, please give full
title. If more than one trustee, all should
sign.