mbfi_102307.htm
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) October 23, 2007
MB
FINANCIAL, INC.
(Exact
name of registrant as specified in its charter)
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Maryland
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0-24566-01
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36-4460265
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(State
or other jurisdiction
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(Commission
File No.)
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(IRS
Employer
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|
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jurisdiction
of
incorporation) Identification
Number)
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800
West
Madison Street, Chicago,
Illinois 60607
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(Address
of principal executive offices) (Zip
Code)
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Registrant's
telephone number, including area code: (888)
422-6562
N/A
(Former
name or former address, if changed since last report)
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:
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o
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Written
communications pursuant to Rule 425 under the Securities Act (17
CFR
230.425)
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o
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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o
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR
240.14d-2(b))
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o
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR
240.13e-4(c))
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Item
5.02 Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers
On
October 23, 2007, MB Financial, Inc. (the “Company”) and Richard M. Rieser, Jr.,
the Company’s Vice Chairman, Executive Vice President and Chief Marketing and
Legal Strategist, executed a Separation and Settlement Agreement and Mutual
Release (the “Separation Agreement”). Pursuant to the Separation
Agreement, Mr. Rieser resigned from each of his positions with the Company,
including his position as a director of the Company, effective as of the close
of business on October 23, 2007.
In
settlement of its remaining obligations to him under his employment agreement,
which otherwise would have terminated on August 25, 2011, the Company will
make
a lump sum cash payment to Mr. Rieser on April 24, 2008 (the “Payment Date”) in
the aggregate gross amount of $3,965,000. The Separation Agreement
also provides for the acceleration of vesting of 5,551 shares of restricted
stock and 5,604 restricted stock units previously awarded to Mr. Rieser pursuant
to his employment agreement, all of which were scheduled to vest on August
24,
2011, and further provides that the restricted stock units will be settled
on
the Payment Date in an equal number of unrestricted shares of Company common
stock. In addition, the Separation Agreement specifies the payout
terms of Mr. Rieser’s benefits under his Supplemental Pension Benefit Agreement,
originally entered into in October 1994, which will commence January 1, 2008,
subject to the possibility of deferral until the Payment Date if necessary
to
comply with Section 409A of the Internal Revenue Code of 1986, as amended
(“Section 409A”).
The
termination of his employment will result in the commencement of other payments
and benefits to Mr. Rieser, including (i) twelve annual payments of $80,000,
commencing November 1, 2007 (subject to the possibility of deferral until the
Payment Date if necessary to comply with Section 409A), in consideration for
a
covenant not to solicit the Company’s customers or employees for two years,
pursuant to his Agreement Regarding Post-Employment Restrictive Covenants,
originally entered into in October 1994; (ii) the distribution of his Executive
Deferred Compensation Plan account balance, at the times specified in the
Separation Agreement; and (iii) the continuation of health benefits as provided
for under his employment agreement, except that the coverage limitation
specified in the employment agreement will not apply until October 24, 2009
and
Mr. Rieser and his spouse must use best efforts to obtain Medicare and Medicare
“supplemental coverage” as soon as they are eligible to do so. The
Separation Agreement requires Mr. Rieser’s continued assistance to the Company
in connection with specified litigation, and requires the Company to provide
him
with office and secretarial support through May 31, 2008. The
Separation Agreement requires the Company to provide reasonable funding for
Mr.
Rieser to arrange a departure party for himself, and to pay fees of $25,000
to
Mr. Rieser’s legal counsel for the drafting and negotiation of the Separation
Agreement.
The
Company estimates that, as a result of Mr. Rieser’s termination of service, its
earnings for the fourth quarter of 2007 will be reduced by approximately $0.10
to $0.11 per share due to the associated expense, and that it will realize
cost
savings, net of tax, of approximately $0.03 per share for the 2008
year.
As
required by law, Mr. Rieser has seven days from the execution date of the
Separation Agreement to revoke his execution of the agreement and the
resignation of his positions with the Company.
The
above description of the Separation
Agreement is qualified in its entirety by reference to the full text of the
agreement, a copy of which is filed as Exhibit 10.1 to this report and is
incorporated herein by reference.
Forward
Looking Statements
When
used
in this Current Report and in other filings with the Securities and Exchange
Commission, in press releases or other public shareholder communications, or
in
oral statements made with the approval of an authorized executive officer,
the
words or phrases “believe,” “will,” “should,” “will likely result,” “are
expected to,” “will continue,” “is anticipated,” “estimate,” “project,” “plans,”
or similar expressions are intended to identify “forward-looking statements”
within the meaning of the Private Securities Litigation Reform Act of 1995.
You
are cautioned not to place undue reliance on any forward-looking statements,
which speak only as of the date made. These statements may relate to
the Company’s future financial performance, strategic plans or objectives,
revenues, earnings or cots savings projections, or other financial
items. By their nature, these statements are subject to numerous
uncertainties that could cause actual results to differ materially from those
anticipated in the statements.
Important
factors that could cause actual results to differ materially from the results
anticipated or projected include, but are not limited to, the following: (1)
the
possibility that the actual impact on the Company’s earnings per share for the
fourth quarter of 2007 and for 2008 will be outside the estimated ranges set
forth in this report, whether due to actual benefit amounts to be provided
to
Mr. Rieser differing from current actuarial estimates of such amounts, or
otherwise; (2) the possibility that the previously announced sale of the
Company’s Union Bank, N.A. subsidiary (“Union Bank”) will not be completed
within the expected time frame, whether due to delays in receipt of regulatory
approval for the transaction or the purchaser’s inability to obtain all of the
financing it needs to enable it to pay the purchase price; (3) the possibility
that the loss of future income from Union Bank will have a greater impact on
the
Company’s overall earnings per share than currently anticipated, whether due to
realizing less income than the Company expects to realize from the loans it
will
repurchase from Union Bank prior to closing and on its investments of the Union
Bank sale proceeds, or due to unfavorable market conditions or other factors
impeding the Company’s planned stock repurchase activity; (4) expected cost
savings and synergies from the Company’s merger and acquisition activities might
not be realized within the expected time frames; (5) the credit risks of lending
activities, including changes in the level and direction of loan delinquencies
and write-offs and changes in estimates of the adequacy of the allowance for
loan losses; (6) competitive pressures among depository institutions; (7)
interest rate movements and their impact on customer behavior and net interest
margin; (8) the impact of repricing and competitors’ pricing initiatives on loan
and deposit products; (9) the ability to adapt successfully to technological
changes to meet customers’ needs and developments in the market place; (10) the
Company’s ability to realize the residual values of our direct finance,
leveraged, and operating leases; (11) the Company’s ability to access
cost-effective funding; (12) changes in financial markets; (13) changes in
economic conditions in general and in the Chicago metropolitan area in
particular; (14) the costs, effects and outcomes of litigation; (15) new
legislation or regulatory changes, including but not limited to changes in
federal and/or state tax laws or interpretations thereof by taxing authorities;
(16) changes in accounting principles, policies or guidelines; (17) the
Company’s future acquisitions of other depository institutions or lines of
business; (18) the Company’s deposit growth and deposit mix resulting from its
new deposit gathering strategy may be less favorable than expected; and (19)
the
impact of the guidance prepared by the Office of the Comptroller of the Currency
regarding concentrations in real estate lending.
The
Company does not undertake any obligation to update any forward-looking
statement to reflect circumstances or events that occur after the date on which
the forward-looking statement is made.
Item
9.01 Financial Statements and Exhibits
(d) Exhibits
SIGNATURES
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.
MB
FINANCIAL,
INC.
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Date:
10/29/07
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By:
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/S/Jill
E. York
Jill
E. York
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Vice
President and
Chief Financial Officer
EXHIBIT
INDEX
Exhibit
No. Description
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10.1
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Separation
and Settlement Agreement and Mutual Release, dated October 23, 2007,
by
and between Richard M. Rieser, Jr. and MB Financial,
Inc.
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FINANCIAL\FIN'L
REPORTING\8-K\8KRIESERSEPARATIONAGMNT2.DOC