UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported):
January 23, 2018
 
FIRST MID-ILLINOIS BANCSHARES, INC.
(Exact Name of Registrant as Specified in its Charter)
 
Delaware
0-13368
37-1103704
(State of Other Jurisdiction
(Commission File Number)
(IRS Employer
of Incorporation)
 
Identification No.)
1421 CHARLESTON AVENUE
 
MATTOON, IL
61938
(Address of Principal Executive Offices)
(Zip Code)
 
(217) 234-7454
(Registrant’s Telephone Number, including Area Code)
 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[X]
Written communications pursuant to Rule 425 under the Securities Act (17CFR 230.425)
[ ]
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17CFR 240.14a-12)
[ ]
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17CFR 240.14d-2(b))
[ ]
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17CFR 240.13e-4(c))


Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company [ ]

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]

    

Item 5.02.
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On January 23, 2018, the Compensation Committee of the Board of Directors of First Mid-Illinois Bancshares, Inc. approved the following grants:
Employee
Restricted Stock
Stock Units
Joe Dively
3,000
5,200
Mike Taylor
1,500
1,500
Eric McRae
1,500
1,500
Matt Smith
1,000
1,000
Brad Beesley
1,000
1,000
The Compensation Committee has also approved the forms of award agreements for these awards, which are attached hereto as exhibits 10.1 and 10.2.
Restricted Stock Agreement : This agreement reflects the terms and conditions applicable to the restricted stock awards. The awards vest at a rate equal to 1/3 of the shares subject to the award on each of the next three December 15 th dates following the grant.

Stock Unit/Restricted Stock Agreement : This agreement reflects the terms and conditions applicable to the stock units awards, which entitle the recipient to a restricted stock grant in the following year if a specified performance goal is met for the year in which the stock unit is granted .
Forward Looking Statements
This document may contain certain forward-looking statements about First Mid-Illinois Bancshares, Inc. (“First Mid”) and First BancTrust Corporation (“First Bank”), such as discussions of First Mid’s and First Bank’s pricing and fee trends, credit quality and outlook, liquidity, new business results, expansion plans, anticipated expenses and planned schedules. First Mid and First Bank intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1955. Forward-looking statements, which are based on certain assumptions and describe future plans, strategies and expectations of First Mid and First Bank, are identified by use of the words “believe,” “expect,” “intend,” “anticipate,” “estimate,” “project,” or similar expressions. Actual results could differ materially from the results indicated by these statements because the realization of those results is subject to many risks and uncertainties, including, among other things, the possibility that any of the anticipated benefits of the proposed transactions between First Mid and First Bank will not be realized or will not be realized within the expected time period; the risk that integration of the operations of First Bank with First Mid will be materially delayed or will be more costly or difficult than expected; the inability to complete the proposed transactions due to the failure to obtain the required stockholder approval; the failure to satisfy other conditions to completion of the proposed transactions, including receipt of required regulatory and other approvals; the failure of the proposed transactions to close for any other reason; the effect of the announcement of the transaction on customer relationships and operating results; the possibility that the transaction may be more expensive to complete than anticipated, including as a result of unexpected factors or events; changes in interest rates; general economic conditions and those in the market areas of First Mid and First Bank; legislative/regulatory changes; monetary and fiscal policies of the U.S. Government, including policies of the U.S. Treasury and the Federal Reserve Board; the quality or composition of First Mid’s and First Bank’s loan or investment portfolios and the valuation of those investment portfolios; demand for loan products; deposit flows; competition, demand for financial services in the market areas of First Mid and First Bank; and accounting principles, policies and guidelines. Additional information concerning First Mid, including additional factors and risks that could materially affect First Mid’s financial results, are included in First Mid’s filings with the Securities and Exchange Commission (the “SEC”), including its Annual Reports on Form 10-K. Forward-looking statements speak only as of the date they are made. Except as required under the federal securities laws or the rules and regulations of the SEC, we do not undertake any obligation to update or review any forward-looking information, whether as a result of new information, future events or otherwise.

    

 
Important Information about the Merger and Additional Information
First Mid filed a registration statement on Form S-4 with the SEC on January 22, 2018, in connection with the proposed transaction. The registration statement includes a proxy statement of First Bank that also constitutes a prospectus of First Mid.  Investors in First Bank are urged to read the proxy statement/prospectus, which contains important information, including detailed risk factors, and all amendments thereto when they become available. The proxy statement/prospectus and other documents which will be filed by First Mid with the SEC will be available free of charge at the SEC’s website, www.sec.gov, or by directing a request to First Mid-Illinois Bancshares, P.O. Box 499, Mattoon, IL 61938, Attention: Investor Relations; or to First BancTrust Corporation, 114 West Church Street, Champaign, IL 61824, Attention: Investor Relations. The final proxy statement/prospectus will be mailed to the stockholders of First Bank.
 
This communication shall not constitute an offer to sell or the solicitation of an offer to buy securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction.
 
Participants in the Solicitation
First Mid and First Bank, and certain of their respective directors, executive officers and other members of management and employees are participants in the solicitation of proxies in connection with the proposed transactions. Information about the directors and executive officers of First Mid is set forth in the proxy statement for its 2017 annual meeting of stockholders, which was filed with the SEC on March 14, 2017. Information about the directors and executive officers of First Bank is set forth in its proxy statement for its 2017 annual meeting of stockholders, which is available on its website, and in the proxy statement/prospectus that was filed with the SEC on January 22, 2018.   These documents can be obtained free of charge from the sources provided above.  Investors may obtain additional information regarding the interests of such participants in the proposed transactions by reading the proxy statement/prospectus for such proposed transactions, and all amendments thereto when they become available.

Item 9.01.     Financial Statements and Exhibits

(d)   Exhibits
 
Exhibit Index

Exhibit No.
Description
Form of Restricted Stock Award Agreement.*
Form of Stock Unit/Restricted Stock Award Agreement.*
* Compensation plan or arrangement.



    

SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.

FIRST MID-ILLINOIS BANCSHARES, INC.


Dated: January 29, 2018     

By: DIVELY.JPG

Joseph R. Dively
Chairman and Chief Executive Officer


    



Exhibit 10.1
FIRST MID-ILLINOIS BANCSHARES, INC. 2017 STOCK INCENTIVE PLAN
RESTRICTED STOCK AWARD AGREEMENT
Award . First Mid-Illinois Bancshares, Inc. (the “Company”) hereby grants a Restricted Stock Award (the “Award”) as of January 23, 2018 (the “Grant Date”) relating to shares of the common stock of the Company (the “Shares”) to _________________________ (the “Employee”), subject in all respects to the terms and conditions of the First Mid-Illinois Bancshares, Inc. 2017 Stock Incentive Plan (the “Plan”) and the terms and conditions set forth herein.
Acceptance By Employee . Receipt of the Award is conditioned on the Employee’s execution of this Agreement and return of an executed copy to the Company no later than February __, 2018. If the Employee fails to return this executed Agreement by the due date, the Awards shall be forfeited to the Company.
1. Grant of Restricted Stock. The Company hereby grants to the Employee an Award covering ____ Shares.

2. Restrictions/Vesting.

(a) Restrictions . Except as set forth in Section 10 of the Plan, none of the Shares subject to the Award shall be sold, assigned, pledged or otherwise transferred, voluntarily or involuntarily, by the Employee (or his estate or personal representative, as the case may be), until such restrictions lapse and the Award vests.

(b) Lapse of Restrictions . The restrictions described above shall lapse, and the Employee shall become vested in the Award, at a rate equal to 1/3 of the Shares subject to the Award on each of December 15, 2018, 2019 and 2020 (or the immediately preceding business day if the applicable December 15 is not a business day), provided that the Employee remains continuously employed through each vesting date. If the Employee’s employment terminates for any reason prior to a vesting date, the Employee shall forfeit any then unvested portion of the Award, except that if the Employee voluntarily terminates employment after attaining age 65 with 10 years of service, if the Company terminates the Employee’s employment without Cause, or if the Employee’s termination of employment is due to death or Disability, the Employee will vest in all of the then unvested Shares subject to the Award. (For this purpose, (A) “Cause” shall have the meaning set forth in Section 4(c) below and (B) “Disability” means as defined under the Company’s long-term disability plan for employees, or if there is none, a physical or mental disability that impairs the Employee’s ability to substantially perform the Employee’s current duties for a period of at least 12 consecutive months, as determined by the Committee in its sole discretion.)

(c) Director Status . In the case of an Employee who is also a director of the Company, if the Employee’s employment with the Company and all Subsidiaries terminates before the Award vests, but the Employee remains a director, the Employee’s service on the Board will be considered employment with the Company, and the Employee’s Award will continue to vest while service on the Board continues. Any subsequent termination of service on the Board will be considered termination of employment, and vesting in the Award will be determined as of the date of such termination of employment.




(d) Forfeited Shares . Shares subject to the Award that do not vest will be forfeited back to the Company.

The foregoing provisions of this Section 2(b) shall be subject to the provisions of any written employment agreement or severance agreement that has been or may be executed by the Employee and the Company, and the provisions in such employment agreement or severance agreement concerning the vesting of an Award in connection with the Employee’s termination of employment shall supersede any inconsistent or contrary provision of this Section 2.
3. Settlement of Award .

(a) Shares . Shares subject to the Award shall be held by the Company in electronic book entry form on the records of the Company’s transfer agent. If an Employee becomes vested in any portion of the Award, the Company shall distribute to the Employee, or the Employee’s personal representative, beneficiary or estate, as applicable, the number of Shares subject to such vested portion. Delivery of such Shares shall be by book-entry credit to an account in the Employee’s name established by the Company with its transfer agent, or upon written request, in electronic form to the Employee’s broker for the Employee’s account or in certificates in the name of the Employee (or in each case his personal representative, beneficiary or estate).

(b) Dividends . Upon the payment of any dividends on Shares during the period preceding the date of vesting of the Award, the Company shall credit the Employee with the dividends payable with respect to the Shares subject to the Award. Such amounts shall be paid to the Employee in cash to the extent any portion of the related Award vests. Any such dividends relating to the portion of an Award that is forfeited shall also be forfeited.

(c) Distribution . Distribution of Shares and cash in settlement of the vested portion of the Award shall be made no later than the March 15 th following the last day of the calendar year in which the Shares vest.

4. Change in Control.

(a) In the event of a Change in Control, (i) unless the Award is continued or assumed by a public company, it shall become fully vested immediately prior to the Change in Control; and (ii) if the Award is continued or assumed by a public company, and within two years following the Change in Control either the Employee’s employment is terminated without Cause or the Employee terminates his employment for Good Reason, the Award shall become fully vested.

(b) For purposes of this Agreement, (i) “Cause” means the Employee’s (A) conviction in a court of law of (or entering a plea of guilty or no contest to) any crime or offense involving fraud, dishonesty or breach of trust or involving a felony; (B) performance of any act which, if known to the customers, clients, stockholders or regulators of the company, would materially and adversely impact the business of the company; (C) act or omission that causes a regulatory body with jurisdiction over the company to demand, request, or recommend that the Employee be suspended or removed from any position in which the Employee serves with the company; (D) substantial nonperformance of any of the Employee’s obligations under any employment agreement or severance agreement between him and the company; (E) material misappropriation of or intentional material damage to the property or business of the company or any subsidiary; or (F) a breach of any confidential information or non-compete or non-solicitation agreement between the Employee and the company; and (ii) “Good Reason” means the occurrence of one of the following




events without the Employee’s written consent: (A) a material diminution in the Employee’s position, authority or responsibility; (B) a material reduction in the Employee’s total compensation (including benefits and annual and long-term incentive opportunity) from then-current levels; (C) a relocation of the Employee’s primary place of employment of at least 30 miles; or (D) the company materially breaches any employment agreement or severance agreement between the company and the Employee.

5. Withholding Taxes. Prior to any distribution to the Employee, the Employee shall pay to the Company an amount sufficient to satisfy all minimum Federal, state and local withholding tax requirements. Payment of such taxes may be made in cash or by directing the Company to withhold such number of Shares otherwise issuable in connection with the Award having a fair market value equal to the amount of tax to be withheld.

6. Rights as Stockholder. The Employee is entitled to all of the rights of a stockholder of the Company with respect to Shares subject to Award, provided that the right to receive dividends shall be as described in Section 3(b) above.

7. Committee Determinations. The Committee shall make all determinations concerning the rights to benefits under the Plan.

8. Defined Terms. Capitalized terms used in this Agreement shall be as defined in the Plan.

Dated: __________________________________
First Mid-Illinois Bancshares, Inc.


By: _____________________________________
Joseph R. Dively
Chairman and CEO
ATTEST:

The Employee acknowledges that he or she has received a copy of the Plan and Prospectus and is familiar with the terms and conditions set forth therein. The Employee agrees to accept as binding, conclusive, and final all decisions and interpretations of the Committee.
Dated: __________________________________

By: _____________________________________









Exhibit 10.2
FIRST MID-ILLINOIS BANCSHARES, INC. 2017 STOCK INCENTIVE PLAN
STOCK UNIT/RESTRICTED STOCK AWARD AGREEMENT
Award . First Mid-Illinois Bancshares, Inc. (the “Company”) hereby grants a Stock Unit/Restricted Stock Award (the “Award”) as of __________, 20__ (the “Grant Date”) relating to shares of the common stock of the Company (the “Shares”) to _________________ (the “Employee”), subject in all respects to the terms and conditions of the First Mid-Illinois Bancshares, Inc. 2017 Stock Incentive Plan (the “Plan”) and the terms and conditions set forth herein.
Target Number of Shares Subject to Stock Unit Award: ________
Performance Period: January 1, 20__ to December 31, 20__
Target Net Income for Performance Period: ________

Acceptance By Employee . Receipt of this Award is conditioned on the Employee’s execution of this Agreement and return of an executed copy to the Company no later than _________, 20__. If the Employee fails to return this executed Agreement by the due date, the Award shall be forfeited to the Company.
1. Stock Unit Award.

(a) Target Net Income . The Stock Unit Award entitles the Employee to receive a Restricted Stock Award following the end of the Performance Period. If the Company achieves the Target Net Income goal for the Performance Period, the Employee shall be granted a Restricted Stock Award covering ____ Shares. If Net Income for the Performance Period is higher than Target, the Committee in its discretion may increase the number of Shares subject to the Restricted Stock Award. If the Target Net Income goal is not achieved for the Performance Period, the Stock Unit Award will be forfeited and no Restricted Stock Award will be granted.

(b) Forfeiture of Stock Unit Award . Notwithstanding Section 1(a), and except as otherwise determined by the Committee, the Employee’s Stock Unit Award (and related dividend equivalents) shall be forfeited, and the Employee shall not be entitled to receive any Restricted Stock Award, if the Employee does not remain continuously employed by the Company or a Subsidiary from the Grant Date until the date the Committee grants the Restricted Stock Award.

2. Restricted Stock Award.

(a) Grant . The Committee shall approve the grant of the Restricted Stock Award described above at the Committee’s first meeting after the end of the Performance Period.

(b) Restrictions/Vesting .

(i) Except as set forth in Section 10 of the Plan, none of the Shares subject to the Restricted Stock Award shall be sold, assigned, pledged or otherwise transferred, voluntarily or involuntarily, by the Participant (or his estate or personal representative, as the case may be), until such restrictions lapse and the Award vests.





(ii) The restrictions described above shall lapse, and the Employee shall become vested in the Restricted Stock Award, at a rate equal to 1/3 of the Shares subject to the Award on each of December 15, 20__, 20__ and 20__ (or the immediately preceding business day if such December 15 is not a business day), provided that the Employee remains continuously employed through each vesting date. If the Employee’s employment terminates for any reason prior to a vesting date, the Employee shall forfeit any then unvested portion of the Restricted Stock Award, except that if the Employee voluntarily terminates employment after attaining age 65 with 10 years of service, if the Company terminates the Employee’s employment without Cause, or if the Employee’s termination of employment is due to death or Disability, the Employee will vest in all of the then unvested Shares subject to the Restricted Stock Award. (For this purpose, (A) “Cause” shall have the meaning set forth in Section 6(c) below and (B) “Disability” means as defined under the Company’s long-term disability plan for employees, or if there is none, a physical or mental disability that impairs the Employee’s ability to substantially perform the Employee’s current duties for a period of at least 12 consecutive months, as determined by the Committee in its sole discretion.)

(iii) In the case of an Employee who is also a director of the Company, if the Employee’s employment with the Company and all Subsidiaries terminates before the Restricted Stock Award vests, but the Employee remains a director, the Employee’s service on the Board will be considered employment with the Company, and the Employee’s Restricted Stock Award will continue to vest while his service on the Board continues. Any subsequent termination of service on the Board will be considered termination of employment, and vesting in the Restricted Stock Award will be determined as of the date of such termination of employment.

(iv) Shares subject to the Restricted Stock Award that do not vest will be forfeited back to the Company.

The foregoing provisions of this Section 2(b) shall be subject to the provisions of any written employment agreement or severance agreement that has been or may be executed by the Employee and the Company, and the provisions in such employment agreement or severance agreement concerning the vesting of a Restricted Stock Award in connection with the Employee’s termination of employment shall supersede any inconsistent or contrary provision of this Section 2.
(c) Settlement of Award .

(i) Shares subject to Restricted Stock Awards shall be held by the Company in electronic book entry form on the records of the Company’s transfer agent. If an Employee becomes vested in his Restricted Stock Award, the Company shall distribute to him, or his personal representative, beneficiary or estate, as applicable, the number of Shares subject to the Restricted Stock Award. Delivery of such Shares shall be by book-entry credit to an account in the Employee’s name established by the Company with its transfer agent, or upon written request, in electronic form to the Employee’s broker for the Employee’s account or in certificates in the name of the Employee (or in each case his personal representative, beneficiary or estate).

(ii) Upon the payment of any dividends on Shares during the Performance Period, the Company shall credit the Employee with an amount equal in value to the dividends the Employee would have received had the Employee been the actual owner of




the number of Shares subject to the Stock Unit Award on such date. The amount payable to the Employee shall be adjusted to reflect any adjustment made to the related Stock Unit Award pursuant to Section 1(a). Upon the payment of any dividends on Shares during the period preceding the date of vesting of the Restricted Stock Award, the Company shall credit the Employee with the dividends payable with respect to the Shares subject to the Award. Such amounts shall be paid to the Employee in cash to the extent any portion of the related Award vests. Any such dividends relating to the portion of an Award that is forfeited shall also be forfeited.

(iii) Distribution of Shares and cash in settlement of the vested portion of the Restricted Stock Award shall be made no later than the March 15 th following the last day of the calendar year in which the Shares vest.

(d) Withholding Taxes. Prior to any distribution of Shares or cash to the Employee, the Employee shall pay to the Company an amount sufficient to satisfy all minimum Federal, state and local withholding tax requirements. Payment of such taxes shall be made by directing the Company to withhold such number of Shares otherwise issuable in connection with the Award with a fair market value equal to the amount of tax to be withheld.

3. Rights as Stockholder. The Employee is entitled to all of the rights of a stockholder of the Company with respect to Shares subject to the Restricted Stock Award, provided that the right to receive dividends shall be as described in Section 2(c) above. The Employee shall not be entitled to any of the rights of a stockholder of the Company with respect to any Stock Unit Award.

4. Change in Control.

(a) In the event of a Change in Control, unless the Award is continued or assumed by a public company, it shall become fully vested immediately prior to the Change in Control (any Stock Unit Award shall vest at target level and entitle the Employee to the same number of vested Shares).

(b) If the Award is continued or assumed by a public company, and within two years following the Change in Control either the Employee’s employment is terminated without Cause or the Employee terminates his employment for Good Reason, the Award shall become fully vested (any Stock Unit Award shall vest at target level and entitle the Employee to the same number of vested Shares).

(c) For purposes of this Agreement, (i) “Cause” means the Employee’s (A) conviction in a court of law of (or entering a plea of guilty or no contest to) any crime or offense involving fraud, dishonesty or breach of trust or involving a felony; (B) performance of any act which, if known to the customers, clients, stockholders or regulators of the company, would materially and adversely impact the business of the company; (C) act or omission that causes a regulatory body with jurisdiction over the company to demand, request, or recommend that the Employee be suspended or removed from any position in which the Employee serves with the company; (D) substantial nonperformance of any of the Employee’s obligations under any employment agreement or severance agreement between him and the company; (E) material misappropriation of or intentional material damage to the property or business of the company or any subsidiary; or (F) a breach of any confidential information or non-compete or non-solicitation agreement between the Employee and the company; and (ii) “Good Reason” means the occurrence of one of the following events without the Employee’s written consent: (A) a material diminution in the Employee’s position, authority or responsibility; (B) a material reduction in the Employee’s total compensation (including benefits and annual and long-term incentive opportunity) from then-current levels; (C) a relocation of the Employee’s




primary place of employment of at least 30 miles; or (D) the company materially breaches any employment agreement or severance agreement between the company and the Employee.

5. Clawback or Recoupment. The Employee agrees and acknowledges that the Award and Agreement are subject to the terms of any Company clawback or recoupment policy.

6. Committee Determinations. The Committee shall make all determinations concerning the rights to benefits under the Plan.

7. Defined Terms. Capitalized terms used in this Agreement shall be as defined in the Plan.

Dated: ___________________________________
First Mid-Illinois Bancshares, Inc.


By: ______________________________________
Joseph R. Dively
President and CEO

ATTEST:

The Employee acknowledges that he or she has received a copy of the Plan and Prospectus and is familiar with the terms and conditions set forth therein. The Employee agrees to accept as binding, conclusive, and final all decisions and interpretations of the Committee.
Dated: ___________________________________
By: ______________________________________