Van Dukeman

About Van Dukeman

Van A. Dukeman (age 66) is Chairman and Chief Executive Officer of First Busey Corporation (BUSE) and Chairman of Busey Bank; he has served as CEO and director since 2007 and as Chairman since 2020, with 40+ years of banking experience including prior service as President and CEO of Main Street Trust, Inc. before its merger into BUSE in 2007 . Under his leadership, BUSE completed the M&M Bank acquisition in 2024 and closed the CrossFirst merger on March 1, 2025; 2024 net income was $113.7 million (Adj. EPS $2.08) and the value of a $100 investment from 12/31/2019 to 12/31/2024 reached $105 vs $122 for the peer group, indicating modest TSR underperformance versus peers during that window . The board maintained strong capital (CET1 14.10% at 12/31/2024) and credit quality, while advancing fee income diversification in Wealth Management and FirsTech . He also serves as a director of Busey subsidiary FirsTech .

Past Roles

External Roles

Board Governance and Dual-Role Implications

• Board service history and roles: Director since 2007; Chairman and CEO of First Busey; Chairman of Busey Bank; not an independent director due to executive status .
• Committees: All four board committees (Compensation, Audit, Nominating, Enterprise Risk) are composed solely of independent directors; CEO is not on committees .
• Lead Independent Director: Following the CrossFirst merger, Rodney K. Brenneman serves as Lead Independent Director for two years from March 1, 2025, providing independent counterbalance to combined Chair/CEO role; the board held six executive sessions without management in 2024 .
• Attendance: All incumbent directors attended at least 75% of board and committee meetings in 2024 .

Implication: The CEO-Chair dual role concentrates authority but is mitigated by a Lead Independent Director, fully independent committees, and regular executive sessions without management .

Fixed Compensation

• 2025 update: Post-merger, base salaries for NEOs (including the CEO, set solely by the Compensation Committee with consultant input) were reviewed and increased effective March 1, 2025 to align with the larger post-merger peer group; specific CEO amount not disclosed in the proxy .

Performance Compensation

Annual Cash Incentive – Structure (2024)

Annual Cash Incentive – Results (2024)

Long-Term Incentives (LTI) – 2024 Grants and Design

Vesting/Modification due to CrossFirst Merger:

• ROATCE PSUs were deemed earned based on actual performance through 12/31/2024: 2023 grant at 100% of target; 2024 grant at 75% of target; service vesting continues .
• TSR PSUs (2022–2024) were replaced/modified into “Merger PSUs” measured on relative TSR vs KBW Regional Banking Index (KRX) over 1/1/2025–12/31/2026 (0–160% payout) to mitigate merger-announcement impact and align integration incentives .
• RSUs now vest in equal annual installments over three years post-Effective Time (unless earlier by original terms) .

Equity Ownership & Alignment

Red flag: Pledging of 68,097 shares can create forced-selling risk under margin stress, though company policy restricts new pledges and requires approvals .

Employment Terms

• Pre-merger employment agreement (summary reference) included severance equal to base salary plus last bonus, with enhanced 3x multiple and benefits upon change in control, and excise tax gross-up; agreement auto-renews; non-compete (1 year) and confidentiality provisions applied .
• Dukeman Letter Agreement (effective at CrossFirst close):
  • Succession plan (Maddox to become CEO after Succession Period) does not trigger constructive discharge; Dukeman waived right to terminate within one year after change in control; through the Specified Period, his base salary, bonus, and LTI will be no less than Maddox’s .
  • Company terminated severance rights under his prior agreement in compliance with Section 409A; excise tax gross-up eliminated .
  • Retention Payment: $5,635,755 (3× base salary + most recent bonus at Effective Time), payable in lump sum on one-year anniversary of Effective Time, subject to continued employment; clawback if terminated for cause or resigns (non-constructive) in years 1–3 post-close (two-thirds repayable between years 1–2; one-third between years 2–3) .
  • If succession plan does not occur or upon termination without cause/constructive discharge: receive unpaid bonuses/LTI, a cash amount based on remaining Specified Period salary/bonus (or at least one year’s salary + bonus), benefit contributions to year-end, and one-year continued life/health/disability coverage, subject to release .
  • Equity upon qualifying termination during Specified Period: all time-based equity vests; performance-based awards waive service condition and remain eligible to vest based on performance .
  • Non-compete: until the later of one year post-termination or end of the Specified Period; non-solicit of employees for one year post-termination remains in place .
• Clawback policy: Amended in 2023 to comply with Nasdaq Listing Rule 5608; applies to restatements and specified misconduct for NEOs and covered individuals .

Change-in-control table (pre-merger as of 12/31/2024 for context): an “Involuntary Termination” in connection with CIC showed cash severance $4,112,025 and equity acceleration value $3,858,829 for the CEO; note that his severance rights were later terminated and replaced by the Retention Payment per the Dukeman Letter Agreement .

Performance & Track Record

• Strategic execution: Completed M&M Bank acquisition (closed 4/1/2024) and announced/closed CrossFirst merger (effective 3/1/2025), expanding into high-growth metros and enhancing wealth and payments capabilities .
• Financial performance (2024): Net income $113.7m (Adj. diluted EPS $2.08); strong regulatory capital (CET1 14.10%, Tier 1 14.98%, Leverage 11.06%, Total RBC 18.53%); increased wealth management revenue (12.3% YoY) and FirsTech revenue (1.3% YoY) with noninterest income at 30.0% of total revenue .
• Pay vs. performance: Value of $100 invested (12/31/2019–12/31/2024) at $105 for BUSE vs $122 for peer group; 2024 Say-on-Pay approval ~93%, indicating broad shareholder support for compensation design .

Compensation Process, Peer Group, and Say‑on‑Pay

• Committee and consultant: Independent Compensation Committee oversees CEO/NEO pay and uses Pearl Meyer as independent advisor; post-merger peer group updated to reflect larger company .
• Benchmarking peer group (pre-merger, 2024): 24 regional bank peers used to benchmark .
• Say-on-Pay: 93% approval at 2024 Annual Meeting .

Director Compensation (as Director)

• CEO receives no additional pay for board service (director cash/DSU program applies to non-employee directors only) .
• Director ownership guideline: 5× annual cash retainer ($50,000 effective March 2025 → $250,000 guideline) .

Risk Indicators and Red Flags

• Pledging: 68,097 pledged shares (potential forced-selling risk in stress scenarios); policy restricts pledging and prohibits hedging .
• Equity award modifications: TSR PSUs modified/replaced post-merger to a new benchmark (KRX) due to merger-related adverse impact; while framed as integration-aligned retention, investors should monitor for unintended easing of performance conditions .
• Dual role: CEO also Chair; mitigated by Lead Independent Director, independent committees, and regular executive sessions .
• Retention economics: Large cash retention ($5.636m) in lieu of legacy CIC severance; includes repayment provisions which partially mitigate windfall risk .

Equity Ownership & Vesting Schedules (Detail)

Investment Implications

• Alignment: CEO’s pay mix is heavily at-risk, linked to Core EPS, asset quality, non-bank revenue, and multi-year ROATCE/relative TSR; 2024 bonus paid at 136.3% of salary on above-target performance across key metrics .
• Retention and continuity: The Dukeman Letter Agreement replaces legacy CIC severance with a $5.636m retention payment and sets pay not less than the incoming CEO through the Specified Period, signaling planned, orderly succession and continuity but creating a near-term retention cash outlay; repayment terms partially protect shareholders if tenure abbreviates .
• Governance balance: Combined Chair/CEO role is balanced by a Lead Independent Director and fully independent committees; still, investors should monitor independence and board oversight during the integration of CrossFirst .
• Trading signals/overhang: The 3-year RSU vesting cadence and modified TSR PSUs create predictable vesting events through 2026–2029; the 68,097 pledged shares present incremental selling pressure risk in adverse markets .
• Performance vs peers: TSR underperformed a Midwest bank peer benchmark over 2019–2024; however, capital strength, fee income diversification, and M&A scale could improve relative performance post-integration if execution risk is well managed .