8-K

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):
September 29, 2014
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:

[ ]	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))

Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On September 29, 2014, First Mid-Illinois Bancshares, Inc. (the "Company") issued a press release announcing organizational changes for the Company. A copy of the press release is attached as Exhibit 99.1 and is incorporated by reference herein.

Paul Saegesser, Chief Executive Officer of The Checkley Agency, Inc., doing business as First Mid Insurance Group (the “Insurance Group”) has announced plans to retire later this year. With the announcement of Mr. Saegesser’s retirement, Clay Dean, who has served as Senior Vice President, Business Development of First Mid-Illinois Bank & Trust, N.A. ("First Mid") from 2010-2012 and Senior Vice President, Chief Deposit Services Officer since November 2012, will assume the role of Chief Executive Officer of the Insurance Group. Prior to joining the Company, Mr. Dean served as a Vice President at New Alliance Bank in New Haven, Connecticut where he acted as the Bank’s principal business development officer. Mr. Dean will remain an Executive Committee member of First Mid and his existing employment contract will remain in effect.

The Company’s September 29, 2014 press release also announces that Amanda Lewis has been appointed Senior Vice President, Retail Banking Officer and has been appointed to the Executive Committee of First Mid. In her new role, Ms. Lewis will be responsible for the overall management of Retail Deposit Services including: training and development, credit card and merchant services sales, bank security, and developing policies, procedures and objectives. Ms. Lewis began her career with First Mid in 2001 and most recently served as Vice President, Director of Marketing.

On September 29, 2014, the Company and Ms. Lewis entered into an Executive Employment Agreement, effective September 29, 2014 and continuing for three years, until September 28, 2017, under which Ms. Lewis agrees to serve as Senior Vice President of the Company (the “Lewis Agreement”). Under the Lewis Agreement, Ms. Lewis will receive an annual base salary of $92,000 and will participate in the Company’s Incentive Compensation Plan and Deferred Compensation Plan. The Lewis Agreement also provides Ms. Lewis with severance benefits in the event of the termination of her employment under certain circumstances and contains certain confidentiality and non-competition and non-solicitation provisions. The Lewis Agreement is filed as Exhibit 10.1 and is incorporated by reference herein.

Item 9.01. Financial Statements and Exhibits

(d)  Exhibits

Exhibit 10.1 Employment Agreement between First Mid-Illinois Bancshares, Inc. and Amanda D. Lewis, effective September 29, 2014

Exhibit 99.1 Press Release, September 29, 2014

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: September 29, 2014

By:

Joseph R. Dively

Chairman and Chief Executive Officer

INDEX TO EXHIBITS

Exhibit Number	Description
10.1	Employment Agreement between First Mid-Illinois Bancshares, Inc. and Amanda D. Lewis, effective September 29, 2014
99.1	Press Release, September 29, 2014

EX-10.1

Exhibit 10.1

EMPLOYMENT AGREEMENT

This Employment Agreement (the "Agreement") is made and entered into this 29^th day of September, 2014, by and between First Mid-Illinois Bancshares, Inc. ("the Company"), a corporation with its principal place of business located in Mattoon, Illinois, and Amanda D. Lewis (“Manager”).

In consideration of the promises and mutual covenants and agreements contained herein, the parties hereto acknowledge and agree as follows:

ARTICLE ONE

TERM AND NATURE OF AGREEMENT

1.01Term of Agreement. The term of this Agreement shall commence as of September 29, 2014 and shall continue until September 28, 2017. Thereafter, unless Manager’s employment with the Company has been previously terminated, Manager shall continue her employment with the Company on an at will basis and, except as provided in Articles Five, Six and Seven, this Agreement shall terminate unless extended by mutual written agreement.

1.02     Employment. The Company agrees to employ Manager and Manager accepts such employment by the Company on the terms and conditions herein set forth. The duties of Manager shall be determined by the Company’s Chief Executive Officer and shall adhere to the policies and procedures of the Company and shall follow the supervision and direction of the Chief Executive Officer or his designee in the performance of such duties. During the term of her employment, Manager agrees to devote her full working time, attention and energies to the diligent and satisfactory performance of her duties hereunder. Manager shall not, while she is employed by the Company, engage in any activity which would (a) interfere with, or have an adverse effect on, the reputation, goodwill or any business relationship of the Company or any of its subsidiaries; (b) result in economic harm to the Company or any of its subsidiaries; or (c) result in a breach of Section Six of the Agreement.

ARTICLE TWO

COMPENSATION AND BENEFITS

While Manager is employed with the Company during the term of this Agreement, the Company shall provide Manager with the following compensation and benefits:

2.01Base Salary. The Company shall pay Manager an annual base salary of $92,000 per fiscal year, payable in accordance with the Company’s customary payroll practices for management employees. The Chief Executive Officer or his designee may review and adjust Manager's base salary from year to year; provided, however, that during the term of Manager's employment, the Company shall not decrease Manager's base salary.

2.02     Incentive Compensation Plan. Manager shall continue to participate in the First Mid-Illinois Bancshares, Inc. Incentive Compensation Plan in accordance with the terms and conditions of such Plan. Pursuant to the Plan, Manager shall have an opportunity to receive incentive compensation of up to a maximum of 25% of Manager's annual base salary. The Chief Executive Officer or his designee may review and adjust the maximum percentage from year to year, provided, however, that during the term of Manager’s employment, the Company shall not decrease this percentage. The incentive compensation payable for a particular fiscal year will be based upon the attainment of the performance goals in effect under the Plan for such year and will be paid in accordance with the terms of the Plan and at the sole discretion of the Board.

2.03    Deferred Compensation Plan. Manager shall be eligible to participate in the First Mid-Illinois Bancshares, Inc. Deferred Compensation Plan in accordance with the terms and conditions of such Plan.

2.04    Vacation. Manager shall be entitled to three (3) weeks of paid vacation each year during the term of this Agreement.

2.05    Other Benefits. Manager shall be eligible (to the extent she qualifies) to participate in any other retirement, health, accident and disability insurance, or similar employee benefit plans as may be maintained from time to time by the Company for its other management employees subject to and on a consistent basis with the terms, conditions and overall administration of such plans.

2.06    Business Expenses. Manager shall be entitled to reimbursement by the Company for all reasonable expenses actually and necessarily incurred by her on its behalf in the course of her employment hereunder and in accordance with expense reimbursement plans and policies of the Company from time to time in effect for management employees.

2.07    Withholding. All salary, incentive compensation and other benefits provided to Manager pursuant to this Agreement shall be subject to withholding for federal, state or local taxes, amounts withheld under applicable employee benefit plans, policies or programs, and any other amounts that may be required to be withheld by law, judicial order or otherwise or by agreement with, or consent of, Manager.

ARTICLE THREE

DEATH OF MANAGER

This Agreement shall terminate prior to the end of the term described in Section 1.01 upon Manager’s termination of employment with the Company due to her death. Upon Manager’s termination due to death, the Company shall pay Manager’s estate the amount of Manager’s base salary plus her accrued but unused vacation time earned through the date of such death and any incentive compensation earned for the preceding fiscal year that is not yet paid as of the date of such death.

ARTICLE FOUR

TERMINATION OF EMPLOYMENT

Manager’s employment with the Company may be terminated by Manager or by the Company at any time for any reason. Upon Manager’s termination of employment prior to the end of the term of the Agreement, the Company shall pay Manager as follows:

4.01    Termination by the Company for Other than Cause. If the Company terminates Manager’s employment for any reason other than Cause, the Company shall pay Manager the following:

(a)An amount equal to Manager’s monthly base salary in effect at the time of such termination of employment for a period of twelve (12) months thereafter. Such amount shall be paid to Manager periodically in accordance with the Company’s customary payroll practices for management employees.

(b)The base salary and accrued but unused paid vacation time earned through the date of termination and any incentive compensation earned for the preceding fiscal year that is not yet paid.

(c)Continued coverage for Manager and/or Manager’s family under the Company’s health plan pursuant to Title I, Part 6 of the Employee Retirement Income Security Act of 1974 (“COBRA”) and for such purpose the date of Manager’s termination of employment shall be considered the date of the “qualifying event” as such term is defined by COBRA. During the period beginning on the date of such termination and ending at the end of the period described in Section 4.01(a), Manager shall be charged for such coverage in the amount that she would have paid for such coverage had she remained employed by the Company, and for the duration of the COBRA period, Manager shall be charged for such coverage in accordance with the provisions of COBRA.

For purposes of this Agreement, “Cause” shall mean Manager’s (i) 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; (ii) 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; (iii) act or omission that causes a regulatory body with jurisdiction over the Company to demand, request, or recommend that Manager be suspended or removed from any position in which Manager serves with the Company; (iv) substantial nonperformance of any of her obligations under this Agreement; (v) misappropriation of or intentional material damage to the property or business of the Company or any affiliate; or (vi) breach of Article Five or Six of this Agreement.

4.02    Termination Following a Change in Control. Notwithstanding Section 4.01, if, following a Change in Control, and prior to the end of the term of this Agreement, Manager’s employment is terminated by the Company (or any successor thereto) for any reason other than Cause, or if Manager terminates her employment because of a decrease in her then current base salary or a substantial diminution in her position and responsibilities, the Company (or any successor thereto) shall pay Manager the following:

(a)    An amount equal to Manager’s monthly base salary in effect at the time of such termination for a period of twelve (12) months thereafter. Such amount shall be paid in accordance with the Company’s customary payroll practices for management employees.

(b)    An amount equal to the incentive compensation earned by or paid to Manager for the fiscal year immediately preceding the year in which Manager’s termination of employment occurs. Such amount shall be paid to Manager in a lump sum as soon as practicable after the date of her termination.

(c)    The base salary and accrued but unused paid vacation time earned through the date of termination and any incentive compensation earned for the preceding fiscal year that is not yet paid.

(d)Continued coverage for Manager and/or Manager’s family under the Company’s health plan pursuant to Title I, Part 6 of the Employee Retirement Income Security Act of 1974 (“COBRA”) and for such purpose the date of Manager’s termination of employment shall be considered the date of the “qualifying event” as such term is defined by COBRA. During the period beginning on the date of such termination and ending at the end of the period described in Section 4.02(a), Manager shall be charged for such coverage in the amount that she would have paid for such coverage had she remained employed by the Company, and for the duration of the COBRA period, Manager shall be charged for such coverage in accordance with the provisions of COBRA.

For purposes of this Agreement, “Change in Control” shall have the meaning as set forth in the First Mid-Illinois Bancshares, Inc. 2007 Stock Incentive Plan (or successor stock incentive plan maintained by the Company).

4.03    Other Termination of Employment. If, prior to the end of the term of this Agreement, the Company terminates Manager’s employment for Cause, or if Manager terminates her employment for any reason other than as described in Section 4.02 above, the Company shall pay Manager the base salary and accrued but unused paid vacation time earned through the date of such termination and any incentive compensation earned for the preceding fiscal year that is not yet paid.

4.04    Key Employee Status. If at the time of such termination of employment Manager is a “Key Employee” as defined in Section 416(i) of the Internal Revenue Code (without reference to paragraph 5 thereof), and the amounts payable to Manager pursuant to Article Four are subject to Section 409A of the Internal Revenue Code, payment of such amounts shall not commence until six months following Manager’s termination of employment, with the first payment to include the payments that otherwise would have been made during such six-month period.

ARTICLE FIVE

CONFIDENTIAL INFORMATION

5.01    Non-Disclosure of Confidential Information. During her employment with the Company, and after her termination of such employment with the Company, Manager shall not, in any form or manner, directly or indirectly, use, divulge, disclose or communicate to any person, entity, firm, corporation or any other third party, any Confidential Information, except as required in the performance of Manager’s duties hereunder, as required by law or as necessary in conjunction with legal proceedings.

5.02    Definition of Confidential Information. For the purposes of this Agreement, the term "Confidential Information" shall mean any and all information either developed by Manager during his employment with the Company and used by the Company or its affiliates or developed by or for the Company or its affiliates of which Manager gained knowledge by reason of her employment with the Company that is not readily available in or known to the general public or the industry in which the Company or any affiliate is or becomes engaged. Such Confidential Information shall include, but shall not be limited to, any technical or non-technical data, formulae, compilations, programs, devices, methods, techniques, procedures, manuals, financial data, business plans, lists of actual or potential customers, lists of employees and any information regarding the Company's or any affiliate’s products, marketing or database. The Company and Manager acknowledge and agree that such Confidential Information

is extremely valuable to the Company and may constitute trade secret information under applicable law. In the event that any part of the Confidential Information becomes generally known to the public through legitimate origins (other than by the breach of this Agreement by Manager or by other misappropriation of the Confidential Information), that part of the Confidential Information shall no longer be deemed Confidential Information for the purposes of this Agreement, but Manager shall continue to be bound by the terms of this Agreement as to all other Confidential Information.

5.03    Delivery upon Termination. Upon termination of Manager's employment with the Company for any reason, Manager shall promptly deliver to the Company all correspondence, files, manuals, letters, notes, notebooks, reports, programs, plans, proposals, financial documents, and any other documents or data concerning the Company's or any affiliate’s customers, database, business plan, marketing strategies, processes or other materials which contain Confidential Information, together with all other property of the Company or any affiliate in Manager's possession, custody or control.

ARTICLE SIX

NON-COMPETE AND NON-SOLICITATION COVENANTS

6.01    Covenant Not to Compete. During the term of this Agreement and for a period of one (1) year following the later of the termination of Manager's employment for any reason or the last day of the term of the Agreement, Manager shall not, on behalf of herself or on behalf of another person, corporation, partnership, trust or other entity, within a fifty (50) mile radius of Manager’s anywhere First Mid conducts business.

(a)    Directly or indirectly own, manage, operate, control, participate in the ownership, management, operation or control of, be connected with or have any financial interest in, or serve as an officer, employee, advisor, consultant, agent or otherwise to any person, firm, partnership, corporation, trust or other entity which owns or operates a business similar to that of the Company or its affiliates.

(b)    Solicit for sale, represent, and/or sell Competing Products to any person or entity who or which was the Company’s customer or client during the last year of Manager's employment. "Competing Products," for purposes of this Agreement, means products or services which are similar to, compete with, or can be used for the same purposes as products or services sold or offered for sale by the Company or any affiliate or which were in development by the Company or any affiliate within the last year of Manager's employment.

6.02    Covenant Not to Solicit. For a period of six (6) months following the later of the termination of Manager’s employment for any reason or the last day of the term of this Agreement, Manager shall not:

(a)    Attempt in any manner to solicit from any client or customer business of the type performed by the Company or any affiliate or persuade any client or customer of the Company or any affiliate to cease to do such business or to reduce the amount of such business which any such client or customer has customarily done or contemplates doing with the Company or any affiliate, whether or not the relationship between the Company or affiliate and such client or customer was originally established in whole or in part through Manager’s efforts.

(b)    Render any services of the type rendered by the Company or any affiliate for any client or customer of the Company.

(c)    Solicit or encourage, or assist any other person to solicit or encourage, any employees, agents or representatives of the Company or an affiliate to terminate or alter their relationship with the Company or any affiliate.

(d)    Do or cause to be done, directly or indirectly, any acts which may impair the relationship between the Company or any affiliate with their respective clients, customers or employees.

ARTICLE SEVEN

REMEDIES

Manager acknowledges that compliance with the provisions of Articles Five and Six herein is necessary to protect the business, goodwill and proprietary information of the Company and that a breach of these covenants will irreparably and continually damage the Company for which money damages may be inadequate. Consequently, Manager agrees that, in the event that she breaches or threatens to breach any of these provisions, the Company shall be entitled to both (a) a temporary, preliminary or permanent injunction in order to prevent the continuation of such harm; and (b) money damages insofar as they can be determined. In addition, the Company will cease payment of all compensation and benefits under Articles Three and Four hereof. In the event that any of the provisions, covenants, warranties or agreements in this Agreement are held to be in any respect an unreasonable restriction upon Manager or are otherwise invalid, for whatsoever cause, then the court so holding shall reduce, and is so authorized to reduce, the territory to which it pertains and/or the period of time in which it operates, or the scope of activity to which it pertains or effect any other change to the extent necessary to render any of the restrictions of this Agreement enforceable.

ARTICLE EIGHT

MISCELLANEOUS

8.01    Successors and Assignability.

(a)    No rights or obligations of the Company under this Agreement may be assigned or transferred except that the Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place.

(b)    No rights or obligations of Manager under this Agreement may be assigned or transferred by Manager other than her rights to payments or benefits hereunder which may be transferred only by will or the laws of descent and distribution.

8.02    Entire Agreement. This Agreement contains the entire agreement between the parties with respect to the subject matter hereof and may not be modified except in writing by the parties hereto. Furthermore, the parties hereto specifically agree that all prior agreements, whether written or oral, relating to Manager's employment by the Company shall be of no further force or effect from and after the date hereof.

8.03    Severability. If any phrase, clause or provision of this Agreement is deemed invalid or unenforceable, such phrase, clause or provision shall be deemed severed from this Agreement, but will not affect any other provisions of this Agreement, which shall otherwise remain in full force and effect. If any restriction or limitation in this Agreement is deemed to be unreasonable, onerous or unduly restrictive, it shall not be stricken in its entirety and held totally void and unenforceable, but shall be deemed rewritten and shall remain effective to the maximum extent permissible within reasonable bounds.

8.04    Controlling Law and Jurisdiction. This Agreement shall be governed by and interpreted and construed according to the laws of the State of Illinois. The parties hereby consent to the jurisdiction of the state and federal courts in the State of Illinois in the event that any disputes arise under this Agreement.

8.05    Notices. All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed to have been duly given (a) on the date of service if served personally on the party to whom notice is to be given; (b) on the day after delivery to an overnight courier service; (c) on the day of transmission if sent via facsimile to the facsimile number given below; or (d) on the third day after mailing, if mailed to the party to whom notice is to be given, by first class mail, registered or certified, postage prepaid and properly addressed, to the party as follows:

If to Manager:	Amanda D. Lewis
	300 W. Pleasant
	Greenup, IL 62428
If to the Company:	First Mid-Illinois Bancshares, Inc.
	1421 Charleston Avenue
	Mattoon, Illinois 61938
	Facsimile: 217-258-0485
	Attention: Chairman and Chief Executive Officer

Any party may change its address for the purpose of this Section by giving the other party written notice of its new address in the manner set forth above.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.

FIRST MID-ILLINOIS BANCSHARES, INC.

By: /s/ Joseph R. Dively

Title: Chairman and Chief Executive Officer

MANAGER:

/s/ Amanda D. Lewis

EX-99.1

Exhibit 99.1

FOR IMMEDIATE RELEASE

(Photo Attached)

September 29, 2014

Media Contact: Laurel Allenbaugh     Investor Contact: Lee Ann Perry

Executive Vice President      VP, Shareholder Services

217-258-0610     217-258-0493

lallenbaugh@firstmid.com      lperry@firstmid.com

FIRST MID-ILLINOIS BANCSHARES, INC. MAKES ORGANIZATIONAL ANNOUNCEMENT

MATTOON, IL, - Joe Dively, Chairman, President and CEO of First Mid-Illinois Bancshares, Inc., recently announced organizational changes for the company. Paul Saegesser, Chief Executive Officer for First Mid Insurance Group has announced plans to retire later this year. Dively stated, “After 38 years with the agency, we wish Paul the very best in his retirement and thank him for his years of exceptional service to the Company.”

With the announcement of Saegesser’s retirement, Clay Dean will step into the role of Chief Executive Officer of First Mid Insurance Group, and will remain an Executive Committee member of First Mid-Illinois Bank and Trust. In his new position, Clay will oversee the operational, sales, customer service, and financial functions of the agency.

Clay joined First Mid in 2010 as Senior Vice President, Business Development and later moved into the role of Senior Vice President, Chief Deposit Services Officer. Prior to joining First Mid, Clay served as a Vice President at New Alliance Bank in New Haven, Connecticut where he acted as the Bank’s principal business development officer. He previously was with Beech Hill Advisors and Merrill Lynch, both in New York. He has also managed the family office of a Forbes 400 individual client in the U.S. and abroad. Clay obtained a bachelor’s degree from the University of Illinois and a master’s degree from Yale University. Clay has been very active in the community serving on the Board of Directors for The Mattoon Public Library and as a member of The Mattoon Kiwanis Club.

As a result of Clay’s move, Mandy Lewis has been appointed Senior Vice President, Retail Banking Officer for First Mid-Illinois Bank & Trust and will serve on the Executive Committee. In her new role, Mandy will be responsible for the overall management of Retail Deposit Services including: training and development, credit card and merchant services sales, bank security, and developing policies, procedures and objectives.

Mandy began her career with First Mid in 2001 and most recently served as Vice President, Director of Marketing. Mandy holds a bachelor’s degree from Eastern Illinois University and is a graduate of the ABA Bank Marketing and Management School. In 2013, Mandy received the First Mid Chairman’s Award for Excellence, having demonstrated a high level of commitment to First Mid-Illinois Bancshares. She was also a member of the Journal-Gazette’s 2011 Class of 20 Under 40, and has been recognized by the Illinois Business Journal as a Rising Star for career accomplishments. Mandy is active in the community serving on the Board of Directors for Big Brothers Big Sisters.

Dively, commented, “I am pleased that Clay and Mandy are stepping into these new roles. With Clay’s thorough knowledge of bank products, our investment offerings and general risk management, he will be a strong leader and contributor for the First Mid Insurance Group team. And, with Mandy’s strong familiarity of the First Mid markets, our team and products, she will make a strong leader for our retail staff as we continue to build a culture of exceptional customer service.” 

About First Mid-Illinois Bancshares, Inc.:

First Mid-Illinois Bancshares, Inc., headquartered in Mattoon, Illinois, is the parent company of First Mid-Illinois Bank & Trust, N.A. (First Mid) and First Mid Insurance Group. First Mid was first chartered in 1865 and has since grown into a more than $1.5 billion community-focused organization that provides comprehensive banking, trust and wealth management services, and insurance services through a network of 37 banking centers in 25 Illinois communities. First Mid’s vision is to be the best financial institution in the region, where service is provided at a level above expectation, and to be recognized as such by customers, employees and the communities it serves. First Mid-Illinois Bancshares stock is traded on the NASDAQ under the symbol “FMBH”. More information about First Mid is available at www.firstmid.com.

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